Exhibit 10.1

 

 

 

 

 

 

MOOG INC.

STOCK EMPLOYEE COMPENSATION TRUST

 

Effective December 2, 2003

 

 

TABLE OF CONTENTS

   

Page

 

 

ARTICLE 1

Trust, Trustee and Trust Fund 2

 

Section 1.1. Trust 2

 

Section 1.2. Trustee 2

 

Section 1.3. Trust Fund 2

 

Section 1.4. Trust Fund Subject to Claims 2

 

Section 1.5. Definitions 2      

ARTICLE 2

Contributions and Dividends 5  

Section 2.1.

Contributions 5  

Section 2.2.

Dividends 5      

ARTICLE 3

Release and Allocation of Company Stock and Affiliate Stock 6  

Section 3.1.

Available Shares 6  

Section 3.2.

Allocations 6  

Section 3.3.

Excess Shares 6      

ARTICLE 4

Compensation, Expenses and Withholding 8  

Section 4.1.

 Compensation and Expenses 8  

Section 4.2.

Withholding of Taxes 8      

ARTICLE 5

Administration of Trust Fund 9  

Section 5.1.

Management and Control of Trust Fund 9  

Section 5.2.

Investment of Funds 9  

Section 5.3.

Trustee's Administrative Powers 9  

Section 5.4.

Voting and Tendering of Company Stock 11  

Section 5.5.

Indemnification 12  

Section 5.6.

General Duty to Communicate to Committee 13      

ARTICLE 6

Accounts and Reports of Trustee 14  

Section 6.1.

Records and Accounts of Trustee 14  

Section 6.2.

Reports of Trustee 14  

Section 6.3.

Final Report 14      

ARTICLE 7

Succession of Trustee 15  

Section 7.1.

Resignation of Trustee 15  

Section 7.2.

Removal of Trustee 15  

Section 7.3.

Appointment of Successor Trustee 15  

Section 7.4.

Succession to Trust Fund Assets 15  

Section 7.5.

Continuation of Trust 15  

Section 7.6.

Changes in Organization of Trustee 16  

Section 7.7.

Continuance of Trustee's Powers in Event of Termination of the Trust 16      

ARTICLE 8

Amendment or Termination 17  

Section 8.1.

Amendments 17  

Section 8.2.

Termination 17  

Section 8.3.

Form of Amendment or Termination 17      

ARTICLE 9

Miscellaneous 18  

Section 9.1.

Controlling Law 18  

Section 9.2.  

Committee Action 18  

Section 9.3.

Notices 18  

Section 9.4.

Severability 18  

Section 9.5.

Protection of Persons Dealing with the Trust 18  

Section 9.6.

Tax Status of Trust 19  

Section 9.7.

Participants to Have No Interest in the Company by Reason of the Trust 19  

Section 9.8.

Nonassignability 19  

Section 9.9.

Plurals 19  

Section 9.10.

Counterparts 19

MOOG INC.

STOCK EMPLOYEE COMPENSATION TRUST AGREEMENT

                THIS TRUST AGREEMENT (the "Agreement") is effective as of
December 2, 2003, between Moog Inc., a New York corporation (the "Company"), and
G. Wayne Hawk (the "Trustee") as trustee.

W I T N E S S E T H:

                WHEREAS, the Company wants to establish a trust (the "Trust")
for the purposes stated in this Agreement:

                WHEREAS, the Trustee will agree to act as trustee of the Trust,
and to hold legal title to the assets of the Trust, in trust, for the purposes
hereafter stated and in accordance with the terms this Agreement;

                WHEREAS, the Company and/or its Affiliates (as defined below)
have previously adopted the Plans (as defined below);

                WHEREAS, the Company desires to provide assurance of the
availability of the shares of its common or preferred stock or shares of its
Affiliates to satisfy certain of its obligations or those of its subsidiaries
under the Plans;

                WHEREAS, the Company wants the assets to be held in the Trust
Fund (as defined below) to be principally or exclusively securities of the
Company and/or its Affiliates and, therefore expressly waives any
diversification of investments requirement that might otherwise be necessary,
appropriate or required pursuant to applicable provisions of law; and

                WHEREAS, the Company desires to establish the Trust Fund and to
utilize the assets to be held in the Trust Fund to provide the additional
assurance of the availability of the shares of the Company's common or preferred
stock or shares of its Affiliates to satisfy certain of its obligations or those
of its subsidiaries under the Plans; and

                WHEREAS, the Trustee has been appointed as trustee and has
accepted such appointment as of the date set forth first above;

                NOW, THEREFORE, the parties hereto hereby establish the Trust
and agree that the Trust will be comprised, held and disposed of as follows:

ARTICLE 1

TRUST, TRUESTEE AND TRUST FUND

                Section 1.1.

    Trust. This Agreement and the Trust will be known as the Moog Inc. Stock
Employee Compensation Trust. The parties intend that the Trust will be an
independent legal entity with title to and power to convey all of its assets.
The parties further intend that the Trust not be subject to the Employee
Retirement Income Security Act of 1974, as amended, ("ERISA"). The assets of the
Trust will be held, invested and disposed of by the Trustee, in accordance with
the terms of the Trust. No employee benefit plan of the Company or any Affiliate
(including the Plans), or any Participant, is intended to have any claim on, or
any beneficial interest in, any assets of the Trust Fund prior to the time Trust
assets are actually distributed to any such Plan as provided in Article 3.

                Section 1.2.    

Trustee. The trustee named above, and his successor or successors, is hereby
designated as the Trustee hereunder, to receive, hold, invest, administer and
distribute the Trust Fund in accordance with the Trust, the provisions of which
will govern the powers, duties and responsibilities of the Trustee.

                Section 1.3.    

Trust Fund. The assets held at any time and from time to time under the Trust
collectively are herein referred to as the "Trust Fund" and will consist of
contributions received by the Trustee, proceeds of any loans, investments and
reinvestment thereof, the earnings and income thereon, less disbursements
thereof. Except as otherwise provided herein, title to the assets of the Trust
Fund will at all times be vested in the Trustee and securities that are part of
the Trust Fund will be held in such manner that the Trustee names and the
fiduciary capacity in which the securities are held are fully disclosed, subject
to the right of the Trustee to hold title or in the name of a nominee, and the
interests of others in the Trust Fund will be only the right to have such assets
received, held, invested, administered and distributed in accordance with the
provisions of the Trust.

                Section 1.4.

    Trust Fund Subject to Claims. Notwithstanding any provision of this
Agreement to the contrary, the Trust Fund will at all times remain subject to
the claims of the Company's general creditors.

                Section 1.5.

    Definitions. In addition to the terms defined in the preceding portions of
the Trust, the following terms will have the meanings set forth below unless the
context clearly indicates otherwise:

                (a)        

Administrator. "Administrator" means the plan administrator of each Plan.

                (b)        

Affiliate. "Affiliate" means any corporation, more than 50% of the voting stock
of which is held by the Company, directly or through one or more intermediaries,
and any comparable ownership interest in an entity that is not a corporation.

                (c)        

Affiliate Stock. "Affiliate Stock" means shares of common or preferred stock
issued by any Affiliate.

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                (d)        

Board of Directors. "Board of Directors" means the board of directors of the
Company.

                (e)        

Code. "Code" means the Internal Revenue Code of 1986, as amended.

                (f)        

Committee. "Committee" means the administrative committee appointed by the Board
of Directors, which is charged with administration of the Trust. The Committee
will be comprised of the (i) Chairman of the Board of Directors, President and
Chief Executive Officer; (ii) the Executive Vice President and Chief
Administrative Officer; (iii) the Vice Chairman of the Board of Directors and
Vice President Strategy and Technology; and (iv) the Executive Vice President
and Chief Financial Officer or such other persons as the Board of Directors, in
its discretion, may from time to time appoint.

                (g)        

Company. "Company" means Moog Inc., a New York corporation, or any successor
thereto.

                (h)        

Company Stock. "Company Stock" means shares of Class A or Class B common stock,
$1.00 par value, or any other class of common or preferred shares issued by the
Company, or any successor securities thereto.

                (i)        

Extraordinary Dividend. "Extraordinary Dividend" means any dividend or other
distribution of cash or other property (other than Company Stock or Affiliate
Stock) made with respect to Company Stock or Affiliate Stock, which the
Committee declares to be other than an ordinary dividend with respect to Company
Stock or Affiliate Stock held by the Trust.

                (j)        

Fair Market Value. "Fair Market Value" means as of any date the average of the
highest and lowest reported sales prices on such date (or if such date is not a
trading day, then the most recent prior date that is a trading day) of a share
of Company Stock as reported on the composite tape, or similar reporting system,
for issues listed on the New York Stock Exchange (or, if the Company Stock is no
longer traded on the New York Stock Exchange, on such other national securities
exchange on which the Company Stock is listed or national securities or central
market system upon which transactions in Company Stock are reported, as either
may be designated by the Committee for the purposes hereof) or if sales of
Company Stock are not reported in any manner specified above, the average of the
high bid and low asked quotations on such date (or if such date is not a trading
day, then on the most recent prior date which is a trading day) in the
over-the-counter market as reported by the National Association of Securities
Dealers' Automated System or, if not so reported, by National Quotation Bureau,
Incorporated or similar organization selected by the Committee. Fair Market
Value of Affiliate Stock will mean the Company's best effort valuation of worth
of a share of Affiliate Stock.

                (k)        

Loan. "Loan" means any loan or extension of credit to the Trust from the Company
evidenced by the promissory note made by the Trustee with which the Trustee
purchases Company Stock or Affiliate Stock in an open-market transaction,
private transaction or, with the consent of the Board of Directors, from the
treasury of the Company.

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                (l)        

Participant. "Participant" means as of any date any individual who is employed
by the Company or any Affiliate of the Company as of such date and is a
participant in any of the Plans.

                (m)       

Person. "Person" means any individual, corporation, or other party that may
properly be granted trust powers under the laws of the State of New York.

                (n)        

Plan or Plans. "Plan" or "Plans" means any plan, contract, program, agreement,
or arrangement listed on Exhibit A hereto. The Committee, in its sole
discretion, may add to or delete from Exhibit A any plan, contract, program,
agreement, or arrangement for the benefit of employees or directors of the
Company or its Affiliates.

                (o)        

Suspense Account. "Suspense Account" means a separate account to be maintained
by the Trustee to hold Excess Shares pursuant to the terms of Article 3 hereof.

                (p)        

Target Value. "Target Value" means with respect to each calendar quarter in each
Trust Year the total of the amounts the Committee, in its discretion, designate
to the Trustee that will be transferred to each of the Plans.

                (q)        

Trust Year. "Trust Year" means each 52/53-week period ending on the last
Saturday in September. Notwithstanding the foregoing, the first Trust Year will
be the period commencing on the effective date of the Trust and ending on
September 27, 2004.

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ARTICLE 2

CONTRIBUTIONS AND DIVIDENDS

                Section 2.1.    

Contributions. The Company hereby contributes to the Trust Fund and the Trustee
agrees to hold in Trust the property listed in Exhibit B hereto, which will
become the initial principal of the Trust Fund. The Trustee, at such times as he
will determine in his sole discretion, will use the initial principal of the
Trust to purchase shares of Company Stock or, what is or will be after such
purchase, Affiliate Stock through open-market purchases, private transactions,
or, with the Committee's consent, purchases from the treasury of the Company.
The Company, in its sole discretion, may at any time, or from time to time, make
additional deposits of cash or other property in trust with the Trustee to
become part of the principal to be held, administered and disposed of by the
Trustee as provided in the Trust. Additionally, for each calendar quarter in
each Trust Year, (i) the Company and its Affiliates may contribute to the Trust
in cash such amount that, together with dividends, as provided in Section 2.2,
and any other earnings of the Trust, will enable the Trustee to make all
payments of principal and interest due under a Loan on a timely basis, in which
case, unless otherwise expressly provided herein, the Trustee will apply all
such contributions, dividends and earnings to the payment of principal and
interest due under a Loan, or (ii) if, at the end of any calendar quarter in
each Trust Year, any such contribution has not been made in cash, such
contribution will be deemed to have been made in the form of forgiveness of
principal and interest on a Loan from the Company to the Trustee to the extent
of the Company's failure to make contributions made under clause (i) above. All
contributions made under the Trust will be delivered to the Trustee. The Trustee
will be accountable for all contributions received by him, but will have no duty
to require any contributions to be made to him.

                Section 2.2.    

Dividends. Except as otherwise provided herein, dividends paid in cash on
Company Stock or Affiliate Stock held by the Trust, including Company Stock or
Affiliate Stock held in the Suspense Account, will be applied, immediately upon
receipt thereof by the Trustee, to pay interest and to repay or pre-pay
scheduled principal due under a Loan, which application will be in the order
such principal payments are due. Extraordinary Dividends will not be used to pay
interest on or principal of a Loan, but will be invested in additional Company
Stock or Affiliate Stock, at such times as the Trustee, in his sole discretion,
determines. Dividends that are not in cash or in Company Stock or Affiliate
Stock (including Extraordinary Dividends, or portions thereof) will be reduced
to cash by the Trustee and reinvested in Company Stock or Affiliate Stock, at
such times as the Trustee, in his sole discretion, determines. Investments in
Company Stock or Affiliate Stock may be made through open-market purchases,
private transactions, or, with the Committee's consent, purchases from the
treasury of the Company.

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ARTICLE 3

RELEASE AND ALLOCATION OF COMPANY STOCK AND AFFILIATE STOCK

                Section 3.1.   

Available Shares. Subject to the other provisions of this Article, upon the
payment or forgiveness in any calendar quarter in any Trust Year of any
principal on a Loan (a "Principal Payment"), the following number of shares of
Company Stock or Affiliate Stock acquired with the proceeds of the Loan will
become available for allocation ("Available Shares"): the number of shares so
acquired with the proceeds of the Loan and held in the Trust immediately before
such payment or forgiveness (excluding Company Stock or Affiliate Stock held in
the Suspense Account), multiplied by a fraction the numerator of which is the
amount of the Principal Payment and the denominator of which is the sum of such
Principal Payment and the remaining principal of such Loan outstanding after
such Principal Payment. No fractional shares of Company Stock or Affiliate Stock
will become Available Shares. If the preceding computation results in fractional
shares, the number of Available Shares will be computed by rounding down to the
next whole number. Further, the following will become Available Shares for a
calendar quarter: (i) shares of Company Stock or Affiliate Stock held as part of
the Trust Fund not acquired with the proceeds of a Loan and not held in the
Suspense Account, (ii) shares of Company Stock or Affiliate Stock not encumbered
as collateral with respect to a Loan, as the Committee may designate from time
to time to be released from the Suspense Account, and (iii) shares of Company
Stock or Affiliate Stock as the Committee may designate from time to time to be
released from encumbrance as collateral with respect to a Loan. The Committee
will inform the Trustee of the number of shares of Company Stock that will
become Available Shares from time to time, and the Trustee will be permitted to
rely on the directions provided by the Committee.

                Section 3.2.    

Allocations. Subject to the provisions of Section 3.3, Available Shares will be
distributed by the Trustee to the Plans listed in Exhibit A as the Trustee is
directed by the Committee in its discretion. Such transfers will be made at such
time as the Committee, in its sole discretion, determines. Further, the
Committee, in its discretion, may determine that distributions to Plans will be
made in cash, or property other than Company Stock or Affiliate Stock. In such
case, the Committee will direct the Trustee to sell Available Shares, in an
open-market or private transaction, in the amount required to be distributed to
a Plan and to distribute the proceeds to such Plan. The Committee will inform
the Trustee of the number of shares of Company Stock, Affiliate Stock or the
amount of cash that will be transferred to a plan from time to time, and the
Trustee is permitted to rely on the directions provided by the Committee.

                Section 3.3.    

Excess Shares.

                (a)    

To the extent that the Fair Market Value of the shares of the Company Stock or
Affiliate Stock that become Available Shares in a calendar quarter of a Trust
Year exceeds the Target Value for that calendar quarter, Available Shares with a
Fair Market Value equal to such excess will be "Excess Shares." For purposes of
this Section, the Fair Market Value of shares of Company Stock or Affiliate
Stock that become Available Shares will be determined as of the respective dates
shares became Available Shares pursuant to Section 3.1.

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                (b)    

As used herein, the term "Shortfall Amount" means the amount by which the Fair
Market Value of shares of Company Stock or Affiliate Stock that became Available
Shares in any calendar quarter of a Trust Year (determined as of the respective
dates that such shares become Available Shares) is less than the Target Value
for such calendar quarter. If there is a Shortfall Amount in any prior calendar
quarter of any Trust Year, Excess Shares will be allocated pursuant to Section
3.2 until the aggregate Fair Market Value of Excess Shares (determined as of the
respective dates of allocation) which has been allocated under this Subsection
for all prior calendar quarters of all Trust Years equals the total of the
Shortfall Amounts for all prior calendar quarters of all Trust Years.

                (c)    

If any Excess Shares remain after the application of Section 3.3(b), such Excess
Shares will be held in a Suspense Account. If there is a Shortfall Amount in any
later calendar quarter of any Trust Year, Excess Shares will be removed from
such Suspense Account and allocated pursuant to Section 3.2 until the Fair
Market Value of Excess Shares so allocated (determined as of the respective
dates of allocation) equals such Shortfall Amount.

                (d)    

If any Excess Shares remain in the Suspense Account at the termination of the
Trust, such Excess Shares will be transferred to the Company to be held in its
treasury.

                (e)    

The Committee will inform the Trustee of the number of shares of Company Stock
or Affiliate Stock that are Excess Shares from time to time, and direct the
Trustee as to the proper application of such Excess Shares to the reduction of
Shortfall Amounts and to placement of such Excess Shares in a Suspense Account.
The Trustee is permitted to rely on the directions provided to him by the
Committee.

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ARTICLE 4

COMPENSATION, EXPENSES AND WITHHOLDING

                Section 4.1.    

Compensation and Expenses. The Trustee is entitled to such reasonable
compensation for his services as may be agreed upon from time to time by the
Company, and the Trustee is to be reimbursed for his reasonable legal,
accounting, broker, custodial and appraisal fees, expenses and other charges
reasonably incurred in connection with the administration, management,
investment and distribution of the Trust Fund. Such amounts will be paid, and
such reimbursement will be made, by the Company. If not paid within 60 days from
the date the Company is notified of such fees and expenses, such amounts may be
charged against the Trust Fund.

                Section 4.2.    

Withholding of Taxes. While it is anticipated that the Company will make
provision for complying with all applicable Federal, state or local withholding
requirements, the Trustee may withhold, require withholding, or otherwise
satisfy his withholding obligation, on any distribution that it is directed to
make, such amount as it may reasonably estimate to be necessary to comply with
applicable federal, state and local withholding requirements. Upon settlement of
a tax withholding liability, the Trustee will distribute the balance of such
amount, if any. Prior to making any distribution hereunder, the Trustee may
require such release or documents from any taxing authority, or may require such
indemnity, as the Trustee will reasonably deem necessary for his protection.

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ARTICLE 5

ADMINISTRATION OF TRUST FUND

                Section 5.1.    

Management and Control of Trust Fund. Subject to the terms of this Agreement,
the Trustee has exclusive authority, discretion and responsibility to manage and
control the assets of the Trust Fund.

                Section 5.2.    

Investment of Funds. Except as otherwise provided in Section 2.2 or in this
Section, the Trustee will invest and reinvest the Trust Fund exclusively in
Company Stock or Affiliate Stock, including any accretions thereto resulting
from the proceeds of a tender offer, recapitalization or similar transaction
that, if not in Company Stock or Affiliate Stock, will be reduced to cash as
soon as practicable. Except in a transaction that is part of a tender offer for
Company Stock, the Trustee may sell, through open-market sale or private
transactions, Available Shares at such time and at such prices only as the
Committee may direct. All proceeds of those sales will be invested as later
provided in this Section 5.2 until such time as the Trustee purchases additional
shares of Company Stock or Affiliate Stock or the proceeds may be used by the
Trustee to pay compensation, fees, expenses or taxes as provided in Article 4.
The Trustee may invest the Trust Fund in Company Stock or Affiliate Stock
without regard to any law or rule of court concerning diversification, risk or
nonproductivity, the applicability of which are hereby fully waived by the
Company. The Trustee may invest any portion of the Trust Fund temporarily
pending investment in Company Stock or Affiliate Stock, distribution or payment
of expenses in (i) investments in United States government obligations with
maturities of less than one year, (ii) interest-bearing accounts including but
not limited to certificates of deposit, time deposits, saving accounts and money
market accounts with maturities of less than one year in any bank, including the
Trustee's, which accounts are insured by the Federal Deposit Insurance
Corporation or other similar federal agency, (iii) obligations issued or
guaranteed by any agency or instrumentality of the United States with maturities
of less than one year, (iv) short-term discount obligations of the Federal
National Mortgage Association or (v) short-term investments of a type then in
use by the Company with respect to its own funds. Absent direction from the
Committee, the Trustee will invest any portion of the Trust Fund temporarily
pending investment in Company Stock or Affiliate Stock, in a short term
government securities mutual fund. At the direction of the Committee, the
Trustee may transfer to the Company shares of Company Stock in exchange for
Affiliate Stock or cash or may transfer to the Company Affiliate Stock in
exchange for Company Stock or cash.

                Section 5.3.    

Trustee's Administrative Powers. Except as otherwise provided herein, and
subject to the Trustee's duties hereunder, the Trustee has the following powers
and rights, in addition to those provided elsewhere in this Agreement and by
law:

                (a)    

to retain any asset of the Trust Fund for the purposes set forth herein;

                (b)    

subject to Section 2.2, Section 5.2, Section 5.4 and Article 3, to sell any
Trust Fund assets at public or private sale;

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                (c)    

upon direction from the Committee, to borrow from the Company to acquire Company
Stock or Affiliate Stock as authorized by this Agreement, to enter into loan
agreements upon such terms (including reasonable interest and security for the
loan and rights to renegotiate and prepay such loan) as may be determined by the
Committee; provided, however, that any collateral given by the Trustee for a
Loan will be limited to cash contributed by the Company to the Trust and
dividends paid on Company Stock or Affiliate Stock held in the Trust Fund and
Company Stock or Affiliate Stock acquired with the proceeds of a Loan;

                (d)    

with the consent of the Committee, to settle, submit to arbitration, compromise,
contest, prosecute or abandon claims and demands in favor of or against the
Trust Fund;

                (e)    

subject to Section 5.4, to vote or to give any consent with respect to any
securities, including any Company Stock or Affiliate Stock, held by the Trust
either in person or by proxy for any purpose;

                (f)    

to exercise any of the powers and rights of an individual owner with respect to
any asset of the Trust Fund and to perform any and all other acts that in his
judgment are necessary or appropriate for the proper administration of the Trust
Fund, even though such powers, rights and acts are not specifically enumerated
in the Trust;

                (g)    

to employ such accountants, actuaries, investment bankers, appraisers, other
advisors and agents as may be reasonably necessary in collecting, managing,
administering, investing, valuing and distributing the Trust's assets and
borrowings of the Trustee made in accordance with Section 5.3(c); and to pay
their reasonable fees and expenses, which will be deemed to be expenses of the
Trust and for which the Trustee will be reimbursed in accordance with Section
4.1;

                (h)    

to cause any asset of the Trust Fund to be issued, held or registered in the
Trustee's individual name or in the name of his nominee, or in such form that
title will pass by delivery, provided that the records of the Trustee will
indicate the true ownership of such asset;

                (i)    

to utilize another entity as custodian to hold, but not invest or otherwise
manage or control, some or all of the assets of the Trust Fund; and

                (j)    

to consult with legal counsel (who may, or may not, also be counsel for the
Trustee or the Company generally) with respect to any of his duties or
obligations hereunder; and to pay the reasonable fees and expenses of such
counsel, which will be deemed to be expenses of the Trust and for which the
Trustee will be reimbursed in accordance with Section 4.1.

Notwithstanding the foregoing, neither the Trust nor the Trustee will have any
power to, and will not engage in any activity that could give the Trust the
objective of carrying on a business and dividing the gains therefrom, within the
meaning of Section 301.7701-2 of the Procedure and Administrative Regulations
promulgated pursuant to the Code.

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                Section 5.4.

    Voting and Tendering of Company Stock.

                (a)    

Except as provided in Subsections (c) and (d), the Trustee, in his sole
discretion, will vote or abstain from voting, all shares of Company Stock or
Affiliate Stock held by the Trust on each matter brought before an annual or
special stockholders meeting or on each matter with respect to which any written
consent of stockholders is to be executed. In exercising those rights, the
Trustee agrees to consider, in connection with those decisions, not only the
direct financial impact on the Trust Fund, but also the potential effects,
direct or indirect, on Participants and the Company's current and former
employees and the communities in which the current and former employees are
located. In connection with his deliberations, the Trustee may, to the extent
possible, obtain information as to how shares of Company Stock or Affiliate
Stock currently held by the Plans will be voted. Further, the Trustee may
consult with the Board of Directors and the Committee to obtain their assessment
of the effects exercising such rights will have on the Company. The Trustee will
not be held to be in breach of any fiduciary duty for any consideration given to
the preceding factors, or such other factors as the Trustee in his reasonable
judgment determines should be considered.

                (b)    

The Trustee may rely on a certificate of the trustee of each of the Plans as to
the manner and proportions in which voting rights with respect to shares of
Company Stock or Affiliate Stock are to be exercised or not exercised by the
trustee of that Plan, and such certificate will constitute full protection to
the Trustee for any action taken or omitted to be taken by him in good faith in
reliance thereon.

                (c)    

Voting of Company Stock on Significant Transactions. The Trustee will follow the
directions of participants in the Moog Inc. Savings and Stock Ownership Plan
(the "SSOP") as to the manner in which shares of Company Stock held by the Trust
are to be voted on each matter involving corporate merger, consolidation, sale
of all or substantially all of the Company's assets, recapitalization,
reclassification, liquidation, dissolution or similar matter ("Significant
Transactions") or the manner in which any consent is to be executed, in each
case as provided below. The Trustee will on each Significant Transaction vote
the number of shares (including fractional shares) of Company Stock held by the
Trust as follows:  The Trustee shall assign to each SSOP Participant a number of
shares (the "SSOP Participant Directed Amount") equal to the product of (x) the
total number of shares of Company Stock held in the Trust Fund, and (y) a
fraction, the numerator of which is the number of shares of Company Stock
allocated in the SSOP to such SSOP Participant, and the denominator of which is
the total number of shares of Company Stock allocated to all SSOP Participants.
Each share assigned to each SSOP Participant in accordance with the previous
sentence shall be voted in accordance with such participant's instructions to
the trustee of the SSOP. The Trustee may rely on a certificate of the trustee of
the SSOP as to the manner and proportions in which voting rights with respect to
shares of Company Stock are to be exercised or not exercised, and such
certificate will constitute full protection to the Trustee for any action taken
or omitted to be taken by him in good faith in reliance thereon. Any shares of
Company Stock which remain undirected pursuant to the foregoing provisions shall
be voted for, against or to abstain or withhold, as the case may be, in the same
proportions as the shares of Company Stock for which the Trustee is directed as
provided above.

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                (d)    

Tender or Exchange of Company Stock. The Trustee shall tender or exchange or not
tender or exchange the SSOP Participant Directed Amount for each SSOP
Participant in accordance with such participant's instructions to the trustee of
the SSOP. The Trustee may rely on a certificate of the trustee of the SSOP as to
the proportions of shares of Company Stock that are to be tendered or exchanged
or not tendered or exchanged by the trustee of the SSOP, and such certificate
will constitute full protection to the Trustee for any action taken or omitted
to be taken by him in good faith in reliance thereon. If the Trustee does not
receive from one or more SSOP Participants timely instruction as to the manner
in which to respond to such a tender or exchange offer, the Trustee shall not
tender or exchange any shares of Company Stock with respect to which such SSOP
Participants have the right of direction, and the Trustee will have
no discretion in such matter.  

                (e)    

In the event that the SSOP, for any reason, ceases to exist, or the Committee
determines in good faith that it is no longer an appropriate plan for the
purpose of this Section 5.4, the Committee will, for purposes of this Section
5.4, substitute for that plan another employee benefit plan of the Company or
its Affiliates covering a broad cross section of individuals employed by the
Company and its Affiliates and exclude from participation therein, in
substantially the same manner as provided for in this Section 5.4 with respect
to the SSOP, of persons who are directors of the Company.  

                Section 5.5.

    Indemnification.

                (a)    

To the extent lawfully allowable, the Company will and hereby does indemnify and
hold harmless the Trustee from and against any claims, demands, actions,
administrative or other proceedings, causes of action, liability, loss, costs,
damage or expense (including reasonable attorneys' fees and disbursements)
including any liability alleged to have resulted from a violation of the
Securities Act of 1933, that may be asserted against it, in any way arising out
of or incurred as a result of his action or failure to act in connection with
the operation and administration of the Trust; provided that such
indemnification will not apply to the extent that the Trustee has acted in
willful or grossly negligent violation of applicable law or his duties under
this Trust or in bad faith. The Trustee will be under no liability to any person
for any loss of any kind which may result by reason of any action taken by it in
accordance with any direction of the Committee or pursuant to Section 5.4. The
Trustee will be fully protected in acting upon any instrument, certificate, or
paper delivered by the Committee, Board of Directors or any trustee of a Plan
and believed in good faith by the Trustee to be genuine and to be signed or
presented by the proper person or persons, and the Trustee will be under no duty
to make any investigation or inquiry as to any statement contained in any such
writing, but may accept the same as conclusive evidence of the truth and
accuracy of the statements therein contained.

                (b)    

The Company may, but will not be required to, maintain liability insurance to
insure its obligations hereunder. If any payments made by the Company to the
Trust pursuant to this indemnity are covered by insurance, the Company or the
Trust (as applicable) will be subrogated to the rights of the indemnified party
against the insurance company.

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                (c)    

Prior to the time the Company determines whether the Trustee will or will not be
indemnified pursuant to this Section, the Company will advance to the Trustee
any cost or expenses incurred by the Trustee in connection with the defense of
any such claims, demands, actions, administrative or other proceedings or other
causes of action.

                Section 5.6.

    General Duty to Communicate to Committee. The Trustee will promptly notify
the Committee of all communications with or from any government agency or with
respect to any legal proceeding with regard to the Trust and with or from any
participant concerning his entitlement under the Trust.

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ARTICLE 6

ACCOUNTS AND REPORTS OF TRUSTEE

                Section 6.1.

    Records and Accounts of Trustee. The Trustee will maintain accurate and
detailed records and accounts of all transactions of the Trust, which will be
available at all reasonable times for inspection or audit by any person
designated by the Company and which will be retained as required by applicable
law.

                Section 6.2.    

Reports of Trustee. The Trustee will deliver to the Committee a report for the
period ending on the last day of each Trust Year, and for each month, a
duplicate copy of the custodian's report listing all securities and other
property acquired or disposed of and all receipts, disbursements and other
transactions effected by the Trust after the date of the custodian's last
account, and further listing all cash, securities, and other property held by
the Trust, together with the Fair Market Value thereof, as of the end of such
period. In addition to the foregoing, the report will contain information
regarding the Trust Fund's assets and transactions that the Committee, in its
discretion, may reasonably request.

                Section 6.3.    

Final Report. In the event of the resignation or removal of a Trustee hereunder,
the Committee may request and the Trustee will with reasonable promptness
submit, for the period ending on the effective date of such resignation or
removal, a report similar in form and purpose to that described in Section 6.2.

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ARTICLE 7

SUCCESSION OF TRUSTEE

                Section 7.1.

    Resignation of Trustee. The Trustee or any successor thereto may resign as
Trustee hereunder at any time upon delivering a written notice of such
resignation, to take effect 30 days after the delivery thereof to the Board of
Directors, unless the Board of Directors accepts shorter notice; provided,
however, that such resignation will not be effective until a successor Trustee
has assumed the office of Trustee hereunder. In addition, any individual serving
as a Trustee will be deemed to have resigned upon his or her death or if there
is filed with the Committee a certification in writing from any attending
physician of such individual Trustee that he or she is no longer able to make
decisions with respect to financial matters. In such case, the Board of
Directors may immediately appoint a successor Trustee pursuant to Section 7.3.

                Section 7.2.

    Removal of Trustee. The Trustee or any successor thereof may be removed by
the Board of Directors delivering to that Trustee, and to the Committee, an
instrument approved by the Board of Directors removing that Trustee. A removal
will take effect at the date specified in such instrument, which will not be
less than 30 days after delivery of the instrument, unless the Trustee accepts
shorter notice; provided, however, that no such removal will be effective until
a successor Trustee has assumed the office of Trustee hereunder.

                Section 7.3.    

Appointment of Successor Trustee. Whenever the Trustee or any successor thereto
resigns or is removed or a vacancy in the position otherwise occurs, the Board
of Directors will use its best efforts to appoint one or more Persons as
successor Trustee as soon as practicable after receipt of a notice described in
Section 7.1, or the delivery to the Trustee of a notice described in Section
7.2, as the case may be, but in no event more than 30 days after receipt or
delivery, as the case may be, of such notice. A successor Trustee's appointment
will not become effective until the successor accepts the appointment by
delivering its acceptance in writing to the company. If a successor is not
appointed within the 30-day period, the Trustee, at the Company's expense, may
petition a court of competent jurisdiction for appointment of a successor. In
any event, the Company or any of its Affiliates may not be appointed as a
successor Trustee.

                Section 7.4.    

Succession to Trust Fund Assets. The title to all property held hereunder will
vest in any successor Trustee acting pursuant to the provisions hereof without
the execution or filing of any further instrument, but a resigning or removed
Trustee will execute all instruments and do all acts necessary to vest title in
the successor Trustee. Each successor Trustee will have, exercise and enjoy all
of the powers, both discretionary and ministerial, herein conferred upon its
predecessors. A successor Trustee will not be obliged to examine or review the
accounts, records, or acts of, or property delivered by, any previous Trustee
and will not be responsible for any action or any failure to act on the part of
any previous Trustee.

                Section 7.5.

    Continuation of Trust. In no event will the legal disability, resignation or
removal of a Trustee terminate the Trust, but the Board of Directors will
forthwith appoint a successor Trustee in accordance with Section 7.3 to carry
out the terms of the Trust.

-15-

                Section 7.6.

    Changes in Organization of Trustee. In the event that any corporate Trustee
serving hereunder will be converted into, will merge or consolidate with, or
will sell or transfer substantially all of its assets and business to, another
corporation, state or federal, the corporation resulting from such conversion,
merger or consolidation, or the corporation to which such sale or transfer will
be made, will thereafter become and be the Trustee under the Trust with the same
effect as though originally so named but only if such corporation is qualified
to be a successor Trustee hereunder.

                Section 7.7.

    Continuance of Trustee's Powers in Event of Termination of the Trust. In the
event of the termination of the Trust, as provided herein, the Trustee will
dispose of the Trust Fund in accordance with the provisions hereof. Until the
final distribution of the Trust Fund, the Trustee will continue to have all
powers provided hereunder as necessary or expedient for the orderly liquidation
and distribution of the Trust Fund.

-16-

ARTICLE 8

AMENDMENT OR TERMINATION

                Section 8.1.    

Amendments. Except as otherwise provided herein, the Board of Directors may
amend the Trust at any time and from time to time in any manner that it deems
desirable, provided however, no amendment may change the duties of the Trustee
without the Trustee's consent, which consent will not be unreasonably withheld.

                Notwithstanding the foregoing, the Board of Directors will
retain the power under all circumstances to amend the Trust to add employee
benefit plans to, or delete plans from, Exhibit A and to clarify any ambiguities
or similar issues of interpretation in this Agreement.

                Section 8.2.    

Termination. Subject to this Section, the Trust will terminate on the earlier of
(a) the date the Trust no longer holds any assets, or (b) the date specified in
a written notice of termination given by the Board of Directors to the Trustee.

                Upon termination of the Trust, the Trustee will sell all or a
portion of the assets of the Trust Fund as directed by the Committee. The
proceeds of such sale or the assets then remaining in the Trust Fund will then
be distributed by the Committee to the Plans, used towards repayment of any
Loan, or returned to the Company as directed by the Committee in its discretion.
After distribution of all assets held in the Trust Fund as directed by the
Committee, the Company will be deemed to have forgiven all amounts then
outstanding under any Loan, including accrued and unpaid interest.

                Section 8.3.

    Form of Amendment or Termination. Any amendment or termination of the Trust
will be evidenced by an instrument in writing signed by an authorized officer of
the Company, certifying that said amendment or termination has been authorized
and directed by the Company or the Board of Directors, as applicable, and, in
the case of any amendment, will be consented to by signature of the Trustee or
its authorized officer, as the case may be, if required by Section 8.1.

-17-

ARTICLE 9

MISCELLANEOUS

                Section 9.1.

    Controlling Law. The laws of the State of New York will be the controlling
law in all matters relating to the Trust, without regard to conflicts of law.

                Section 9.2.

    Committee Action. Any action required or permitted to be taken by the
Committee may be taken on behalf of the Committee by any individual so
authorized. The Company will furnish to the Trustee the name and specimen
signature of each member of the Committee upon whose statement of a decision or
direction the Trustee is authorized to rely. Until notified of a change in the
identity of such person or persons, the Trustee will act upon the assumption
that there has been no change.

                Section 9.3.

    Notices. All notices, requests, or other communications required or
permitted to be delivered hereunder will be in writing, delivered by registered
or certified mail, return receipt requested, telecopier or hand delivery as
follows:

                    To the Company:                            Moog Inc.
                                                                           
Jamison Road
                                                                            East
Aurora, New York 14052
                    Attention:                                        Joe C.
Green, Executive Vice President and
                                                                                   
Chief Administrative Officer

                    With a copy to:                               John B.
Drenning, Esq.
                                                                           
Hodgson Russ LLP
                                                                            One
M&T Plaza, Suite 2000
                                                                           
Buffalo, NY 14203

                    To the Trustee:                                G. Wayne Hawk
                                                                            1634
Hubbard Road
                                                                            East
Aurora, NY 14052

Any party hereto may from time to time, by written notice given as aforesaid,
designate any other address to which notices, requests or other communications
addressed to it will be sent.

                Section 9.4.    

Severability. If any provision of the Trust will be held illegal, invalid or
unenforceable for any reason, such provision will not affect the remaining parts
hereof, but the Trust will be construed and enforced as if said provision and
never been inserted herein.

                Section 9.5.

    Protection of Persons Dealing with the Trust. No person dealing with the
Trustee will be required or entitled to monitor the application of any money
paid or property delivered to the Trustee, or determine whether or not the
Trustee is acting pursuant to authorities granted to it hereunder or to
authorizations or directions herein required.

-18-

                Section 9.6.

    Tax Status of Trust. It is intended that the Company, as grantor hereunder,
be treated as the owner of the entire Trust and the Trust Fund within the
meaning of subpart E part 1, subchapter K, chapter 1, subtitle A of the Code.
Until advised otherwise, the Trustee in preparing any tax reports or returns may
presume that this is the proper tax status of the Trust.

                Section 9.7.    

Participants to Have No Interest in the Company by Reason of the Trust. Neither
the creation of the Trust nor anything contained in the Trust will be construed
as giving any person, including any individual employed by the Company or any
Affiliate of the Company, any equity or interest in the assets, business or
affairs of the Company.

                Section 9.8.    

Nonassignability. No right or interest of any person to receive distributions
from the Trust will be assignable or transferable, in whole or in part, either
directly or by operation of law or otherwise, including, but not by way of
limitation, execution, levy, garnishment, attachment, pledge, or bankruptcy, but
excluding death or mental incompetency, and no right or interest of any person
to receive distributions from the trust will be subject to any obligation or
liability of such person, including claims for alimony or the support of any
spouse or child.

                Section 9.9.

    Plurals. Whenever the context requires or permits, the singular form will
include the plural form and will be interchangeable.

                Section 9.10.

    Counterparts. This Agreement may be executed in any number of counterparts,
each of which will be considered an original.

                The Company, by its authorized officer, and the Trustee have
caused this Agreement to be signed as of the day, month and year first above
written.

  Moog Inc.               By:     Title:         Trustee           G. Wayne Hawk

-19-

EXHIBIT A

Plans

1. Employee welfare benefit plans (as defined in Section 3(1) of ERISA)
sponsored or maintained by the Company or its Affiliates.     2. Moog Inc.
Savings and Stock Ownership Plan     3. Moog Inc. 1998 Stock Option Plan     4.
Moog Inc. Supplemental Retirement Plan     5. Moog Inc. Deferred Compensation
Plan for Directors and Officers     6. Moog Inc. Management Profit Sharing Plan
    7. Moog Inc. Employee Profit Sharing Plan     8. Moog Inc. Employees'
Retirement Plan    

9.

Moog Inc. Extended Vacation Plan

-20-

EXHIBIT B

INITIAL CONTRIBUTION TO TRUST FUND

$