Document:

EX-10.2

 

Exhibit 10.2

 

    THE GOODYEAR TIRE &
    RUBBER COMPANY

 

    MANAGEMENT
    INCENTIVE PLAN

    Effective
    January 1, 2009

 

    PREAMBLE

 

    This Management Incentive Plan (the “Plan”) is adopted
    effective January 1, 2009, by the Board of Directors of The
    Goodyear Tire & Rubber Company (the
    “Company”). The purpose of the Plan is to advance the
    interests of the Company and its stockholders and assist the
    Company in motivating, attracting and retaining executive
    officers by providing incentives and financial rewards to such
    executive officers that are intended to be deductible to the
    maximum extent possible as “performance-based
    compensation” within the meaning of Section 162(m) of
    the Code.

 

    ARTICLE I

 

    Definitions

 

	 	 	 	 	 
	
 
	
    1
	
    .1
	
 
	
    “Award” means an award of incentive compensation
    pursuant to the Plan.

	
 
	
    1
	
    .2
	
 
	
    “Code” means the Internal Revenue Code of 1986, as
    amended.

	
 
	
    1
	
    .3
	
 
	
    “Committee” means the Compensation Committee of the
    Board of Directors of the Company, or a subcommittee thereof
    consisting of members appointed from time to time by the Board
    of Directors of the Company, and shall comprise not less than
    such number of directors as shall be required to permit the Plan
    to satisfy the requirements of Section 162(m) of the Code. The
    Committee administering the Plan shall be composed solely of
    “outside directors” within the meaning of Section
    162(m) of the Code.

	
 
	
    1
	
    .4
	
 
	
    “Company” means The Goodyear Tire & Rubber
    Company, an Ohio corporation.

	
 
	
    1
	
    .5
	
 
	
    “Disability” means a total and permanent disability
    that causes a Participant to be eligible to receive long term
    disability benefits from the Company’s long term disability
    plan, or any similar plan or program sponsored by a subsidiary
    of the Company.

	
 
	
    1
	
    .6
	
 
	
    “EBIT” has the meaning set forth in Section 3.1 hereof.

	
 
	
    1
	
    .7
	
 
	
    “Executive Officers” mean Board-appointed officers of
    the Company who are designated by the Board as “Section 16
    officers.”

	
 
	
    1
	
    .8
	
 
	
    “Participant” means an Executive Officer who is
    selected by the Committee to participate in the Plan.

	
 
	
    1
	
    .9
	
 
	
    “Performance Period” means the time period during
    which the achievement of the performance goals is to be measured.

	
 
	
    1
	
    .10
	
 
	
    “Plan” means this Management Incentive Plan.

	
 
	
    1
	
    .11
	
 
	
    “Retirement” means termination of employment with the
    Company or an affiliated entity when a Participant is age 55 or
    older.

 

    ARTICLE II

 

    Eligibility and
    Participation

 

	 	 	 	 	 
	
 
	
    2
	
    .1
	
 
	
    Eligibility and Participation. The Committee shall select
    Executive Officers of the Company who are eligible to receive
    Awards under the Plan, and who shall be Participants in the Plan
    during any Performance Period in which they may earn an Award.

 

    ARTICLE III

 

    Terms of
    Awards

 

	 	 	 	 	 
	
 
	
    3
	
    .1
	
 
	
    Calculation of Awards.  The Award payable under the Plan
    for a Performance Period (proportionately adjusted for any
    portion of the Performance Period that is less than a full
    calendar year) is equal to 0.75% of EBIT for the Chief Executive
    Officer for the Performance Period and 0.5% of EBIT for each of
    the other Participants for the Performance Period.

	
 
	
 
	
 
	
 
	
    “EBIT” means the Company’s net sales, less cost
    of goods sold, and selling, administrative and general expense,
    as reported in the Company’s consolidated statement of
    operations for the applicable Performance Period, prior to
    accrual of any amounts for payment under the Plan for the
    Performance Period, adjusted to eliminate the effects of charges
    for restructurings, discontinued operations, extraordinary
    items, other unusual or non-recurring items, and the cumulative
    effect of tax or accounting changes, each as defined by
    generally accepted accounting principles or identified in the
    Company’s consolidated financial statements, notes to the
    consolidated financial statements or management’s
    discussion and analysis of financial condition and results of
    operations.

    

    B-1

 

	 	 	 	 	 
	
 
	
    3
	
    .2
	
 
	
    Discretionary Adjustment.  The Committee may not increase
    the amount payable under the Plan or with respect to an Award
    pursuant to Section 3.1, but retains the discretionary authority
    to reduce the amount. The Committee may establish factors to
    take into consideration in implementing its discretion,
    including, but not limited to, corporate and/or business unit
    performance against achievement of financial goals (e.g.,
    operating income or cash flow) or non-financial goals, economic
    and relative performance considerations, and assessments of
    individual performance.

	
 
	
    3
	
    .3
	
 
	
    Form of Payment.  Each Award under the Plan shall be paid
    in cash or its equivalent. The Committee in its discretion may
    determine that all or a portion of an Award shall be paid in
    shares of common stock, restricted stock, stock options, or
    other stock-based or stock-denominated units, which shall be
    issued pursuant to the Company’s equity compensation plans
    in existence at the time of the grant.

	
 
	
    3
	
    .4
	
 
	
    Timing of Payment.  Payment of Awards will be made as
    soon as practicable following the end of the Performance Period
    and after determination of and certification of the Award, but
    in no event more than two and a half months after the end of the
    calendar year with respect to which such Award was earned,
    unless the a Participant has, prior to the grant of an Award,
    submitted an election to defer receipt of the Award in
    accordance with a deferred compensation plan approved by the
    Committee.

	
 
	
    3
	
    .5
	
 
	
    Performance Period.  Within 90 days after the
    commencement of each fiscal year or, if earlier, by the
    expiration of 25% of a Performance Period, the Committee will
    designate one or more Performance Periods, determine the
    Participants for the Performance Periods and affirm the
    applicability of the Plan’s formula for determining the
    Award for each Participant for the Performance Periods. The time
    period during which the achievement of the performance goals is
    to be measured shall be determined by the Committee, but may be
    no longer than five years and no less than six months.

	
 
	
    3
	
    .6
	
 
	
    Certification.  Following the close of each Performance
    Period and prior to payment of any amount to any Participant
    under the Plan, the Committee will certify in writing as to the
    attainment of the performance goals and the amount of the Award.

 

    ARTICLE IV

 

    New Hires,
    Promotions and Terminations

 

	 	 	 	 	 
	
 
	
    4
	
    .1
	
 
	
    New Participants During the Performance Period. If an
    individual is newly hired or promoted during a calendar year
    into a position eligible for participation in the Plan, he or
    she shall be eligible for an Award under the Plan for the
    Performance Period, prorated for the portion of the Performance
    Period following the date of eligibility for the Plan, subject
    to Section 3.2 hereof and the other terms and conditions of
    the Plan.

	
 
	
    4
	
    .2
	
 
	
    Retirement, Disability or Death. A Participant who
    terminates employment with the Company during a Performance
    Period due to Retirement, Disability or death shall be eligible,
    unless otherwise determined by the Committee, to receive an
    Award prorated for the portion of the Performance Period prior
    to termination of employment. Awards payable in the event of
    death shall be paid to the Participant’s estate.

	
 
	
    4
	
    .3
	
 
	
    Termination of Employment. If a Participant terminates
    employment with the Company for a reason other than Retirement,
    Disability or death, unless otherwise determined by the
    Committee, no Award shall be payable with respect to the
    Performance Period in which such termination occurs.

 

    ARTICLE V

 

    Miscellaneous

 

	 	 	 	 	 
	
 
	
    5
	
    .1
	
 
	
    Withholding Taxes. The Company shall have the right to
    make payment of Awards net of any applicable federal, state,
    local or foreign taxes required to be withheld, or to require
    the Participant to pay such withholding taxes. If the
    Participant fails to make such tax payments as required, the
    Company shall, to the extent permitted by law, have the right to
    deduct any such taxes from any payment of any kind otherwise due
    to such Participant or to take such other action as may be
    necessary to satisfy such withholding obligations.

	
 
	
    5
	
    .2
	
 
	
    Nontransferability. No Award may be sold, assigned,
    transferred, pledged, hypothecated or otherwise disposed of,
    including assignment pursuant to a domestic relations order,
    during the time in which the requirement of continued employment
    or attainment of performance goals has not been achieved. Each
    Award shall be paid during the Participant’s lifetime only
    to the Participant, or, if permissible under applicable law, to
    the Participant’s legal representatives. No Award shall,
    prior to receipt thereof by the Participant, be in any manner
    liable for or subject to the debts, contracts, liabilities or
    torts of the Participant.

    B-2

 

	 	 	 	 	 
	
 
	
    5
	
    .3
	
 
	
    Administration. The Committee shall administer the Plan,
    interpret the terms of the Plan, amend and rescind rules
    relating to the Plan, and determine the rights and obligations
    of Participants under the Plan. The Committee may delegate any
    of its authority as it solely determines, consistent with
    applicable law and the rules and regulations of the New York
    Stock Exchange. In administering the Plan, the Committee may at
    its option employ compensation consultants, accountants and
    counsel and other persons to assist or render advice to the
    Committee, all at the expense of the Company. All decisions of
    the Committee shall be final and binding upon all parties
    including the Company, its stockholders, and the Participants.
    The provisions of this Plan are intended to ensure that all
    Awards granted hereunder qualify for the exemption from the
    limitation on deductibility imposed by Section 162(m) of
    the Code that is set forth in Section 162(m)(4)(C) of the
    Code, and this Plan shall be interpreted and operated consistent
    with that intention.

	
 
	
    5
	
    .4
	
 
	
    Severability. If any provisions of the Plan or any Award
    is or becomes or is deemed to be invalid, illegal or
    unenforceable in any jurisdiction or would disqualify the Plan
    or any Award under any law deemed applicable by the Committee,
    such provision shall be construed or deemed amended to conform
    to applicable laws, or if it cannot be so construed or deemed
    amended without, in the determination of the Committee,
    materially altering the purpose or intent of the Plan or the
    Award, such provision will be stricken as to such jurisdiction,
    and the remainder of the Plan or Award shall remain in full
    force and effect.

	
 
	
    5
	
    .5
	
 
	
    No Fund Created. Neither the Plan nor any Award
    shall create or be construed to create a trust or separate fund
    of any kind or a fiduciary relationship between the Company and
    a Participant or any other person. To the extent that any person
    acquires a right to receive payments from the Company pursuant
    to an Award, such right shall be no greater than the right of
    any unsecured general creditor of the Company.

	
 
	
    5
	
    .6
	
 
	
    Employment at Will. Neither the adoption of the Plan,
    eligibility of any person to participate, nor payment of an
    Award to a Participant shall be construed to confer upon any
    person a right to be continued in the employ of the Company. The
    Company expressly reserves the right to discharge any
    Participant whenever in the sole discretion of the Company its
    interest may so require.

	
 
	
    5
	
    .7
	
 
	
    Amendment or Termination of the Plan. The Board of
    Directors of the Company reserves the right to amend or
    terminate the Plan at any time with respect to future Awards to
    Participants. Amendments to the Plan will require stockholder
    approval to the extent required to comply with applicable law,
    including the exemption under Section 162(m) of the Code.

	
 
	
    5
	
    .8
	
 
	
    Non-Exclusivity of Plan. Neither the adoption of the Plan
    by the Board of Directors nor the submission of the Plan to
    stockholders of the Company for approval shall be construed as
    creating any limitations on the power of the Board of Directors
    or the Committee to adopt such other incentive arrangements as
    either may deem desirable, including, without limitation, cash
    or equity-based compensation arrangements, either tied to
    performance or otherwise.

	
 
	
    5
	
    .9
	
 
	
    Governing Law. The Plan and any agreements hereunder
    shall be interpreted in accordance with the laws of the State of
    Ohio, without reference to principles of conflict of laws that
    might result in the application of the laws of another
    jurisdiction, and applicable federal law.

    B-3EX-10.3

 

			
	Non-Qualified Stock Option Grant Agreement
	 	Exhibit 10.3

PART I — NON-QUALIFIED STOCK OPTIONS

1. These Non-Qualified Stock Options for the number of shares of Common Stock indicated on the
grant summary page (the “Non-Qualified Stock Options”) are granted to you under and are governed by
the terms and conditions of the 2008 Performance Plan of The Goodyear Tire & Rubber Company,
adopted effective April 8, 2008 (the “Plan”), and this Grant Agreement. As your stock options are
conveyed and managed online, your online acceptance constitutes your agreement to and acceptance of
all terms and conditions of the Plan and this Grant Agreement. You also agree that you have read
and understand the Plan and this Grant Agreement. All defined terms used in this Grant Agreement
have the meanings set forth in the Plan.

2. You may exercise the Non-Qualified Stock Options granted pursuant to this Grant Agreement
through (1) a cash payment in the amount of the full option exercise price of the shares being
purchased (including a simultaneous exercise and sale of the shares of Common Stock thereby
acquired and use of the proceeds from such sale to pay the exercise price, to the extent permitted
by law) (a “cash exercise”), (2) a payment in full shares of Common Stock having a Fair Market
Value on the date of exercise equal to the full option exercise price of the shares of Common Stock
being purchased (a “share swap exercise”), or (3) a combination of the cash exercise and share swap
exercise methods. Any exercise of these Non-Qualified Stock Options shall be by written notice
stating the number of shares of Common Stock to be purchased and the exercise method, accompanied
with the payment, or proper proof of ownership if the share swap exercise method is used. You
shall be required to meet the tax withholding obligations arising from any exercise of
Non-Qualified Stock Options.

3. As further consideration for the Non-Qualified Stock Options granted to you hereunder, you must
remain in the continuous employ of the Company or one or more of its Subsidiaries from the Date of
Grant to the date or dates the Non-Qualified Stock Options become exercisable as set forth on the
grant summary page of this Grant Agreement before you will be entitled to exercise the
Non-Qualified Stock Options granted. The Non-Qualified Stock Options you have been granted shall
not in any event be exercisable after your termination of employment except as provided in
paragraph 4 below for Retirement (defined as termination of employment at any age after 30 or more
years, or at age 55 or older with at least 10 years, of continuous service with the Company and its
Subsidiaries), death, or Disability (defined as termination of employment while receiving benefits
under a long-term disability income plan maintained by the Company or one of its Subsidiaries).

II — GENERAL PROVISIONS

4. The Non-Qualified Stock Options terminate automatically and shall not be exercisable by you
from and after the date on which you cease to be an employee of the Company or one of its
Subsidiaries for any reason other than your death, Retirement or Disability. In the event of your
death, Retirement or Disability while an employee of the Company or one of its Subsidiaries (and
having been an employee continuously since the Date of Grant) during the exercise period on any
date which is more than six (6) months after the Date of Grant of the Non-Qualified Stock Options
specified on the grant summary page of this Grant Agreement, the Non-Qualified Stock Options shall
become immediately exercisable and, except as provided below in the event of your death while an
employee, shall be exercisable by you for the lesser of (a) the remainder of the term of the
Non-Qualified Stock Option grant or (b) five years. In the event of your death while an employee,
the Non-Qualified Stock Options may be exercised up to three years after date of death by the
person or persons to whom your rights in the options passed by your will or according to the laws
of descent and distribution. Nothing contained herein shall restrict the right of the Company or
any of its Subsidiaries to terminate your employment at any time, with or without cause.

 

 

			
	Non-Qualified Stock Option Grant Agreement
	 	 

PART II — GENERAL PROVISIONS (Cont’d)

5. The Non-Qualified Stock Options shall not in any event be exercisable after the expiration of
ten years from the Date of Grant specified on the grant summary page of this Grant Agreement and,
to the extent not exercised, shall automatically terminate at the end of such ten-year period.

6. Certificates, or other evidence of beneficial ownership, for the shares of Common Stock
purchased will be deliverable to you or your agent, duly accredited to the satisfaction of the
Company, at the principal office of the Company in Akron, Ohio, or at such other place acceptable
to the Company as may be designated by you.

7. In the event you retire or otherwise terminate your employment with the Company or a Subsidiary
and within 18 months after such termination date you accept employment with a competitor of, or
otherwise engage in competition with, the Company, the Committee, in its sole discretion, may
require you to return, or (if not received) to forfeit, to the Company the economic value of the
Non-Qualified Stock Options granted hereunder which you have realized or obtained by your exercise
at any time on or after the date which is six months prior to the date of your termination of
employment with the Company. Additionally, if you have retired from the Company, all Non-Qualified
Stock Options granted to you hereunder which you have not exercised prior to your competitive
engagement shall be automatically cancelled.

8. Each Non-Qualified Stock Option granted is not transferable by you otherwise than by will or
the laws of descent and distribution, and is exercisable during your lifetime only by you.

9. All rights conferred upon you under the provisions of this Grant Agreement are personal and,
except under the provisions of paragraph 8 of this Grant Agreement, no assignee, transferee or
other successor in interest shall acquire any rights or interests whatsoever under this Grant
Agreement, which is made exclusively for the benefit of you and the Company.

10. Any notice to you under this Grant Agreement shall be sufficient if in writing and if
delivered to you or mailed to you at the address on record in the Executive Compensation
Department. Any notice to the Company under this Grant Agreement shall be sufficient if in writing
and if delivered to the Executive Compensation Department of the Company in Akron, Ohio, or mailed
by registered mail directed to the Company for the attention of the Executive Compensation
Department at 1144 East Market Street, Akron, Ohio 44316-0001. Either you or the Company may, by
written notice, change the address. This Grant Agreement shall be construed and shall take effect
in accordance with the laws of the State of Ohio.

11. Each Non-Qualified Stock Option may be exercised only at the times and to the extent, and is
subject to all of the terms and conditions, set forth in this Grant Agreement, and in the Plan,
including any rule or regulation adopted by the Committee.

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