Document:

Exhibit 10.12

 

Fiscal 2013 Form

 

AAR CORP.

 

Performance Restricted Stock Agreement

(“Agreement”)

 

Subject to the provisions of the AAR CORP. Stock Benefit Plan and the Long-Term Incentive Plan for Fiscal 2013 (together, the “Plan”), the terms of which are hereby incorporated by reference, and in consideration of the agreements of the Grantee herein provided, AAR CORP., a Delaware corporation (“Company”), hereby grants to the Grantee a performance restricted stock award (“Award”), effective July 16, 2012 (“Date of Award”), for the number of shares of common stock (“Common Stock”) of the Company, $1.00 par value (“Award Shares”) set forth in the Company’s notification of Award grant letter to the Grantee dated                   , 2012 and incorporated herein by reference, subject to the forfeiture and nontransferability provisions hereof and the other terms and conditions set forth herein:

 

1.                                      Acceptance By Grantee.  The Award is conditioned upon the acceptance by the Grantee of the terms and conditions of the Award as set forth in this Agreement.  The Grantee must confirm acceptance of the Award and this Agreement on Smith Barney’s web site (www.benefitaccess.com).  If the Grantee does not accept the Award and this Agreement within 30 days from the date of the notification of the Award, the Award referenced herein shall expire unless the acceptance date is extended in writing signed by the Company.

 

2.                                      Performance Condition.  The Award is conditioned upon the Company meeting the cumulative net income performance goal target for the three-year performance period beginning June 1, 2011 and ending May 31, 2014, as set forth in the Long-Term Incentive Plan for Fiscal 2012.  If the Company does not meet the cumulative net income performance goal target at the threshold level set forth in the Long-Term Incentive Plan for Fiscal 2012, the Grantee shall forfeit to the Company all Award Shares.  If the Company meets the net income performance goal target at or above the threshold level but less than the target level, the Grantee shall forfeit that number of Award Shares as determined under the Long-Term Incentive Plan for Fiscal 2012.  The performance conditions also shall be met with respect to all Award Shares at the end of the performance period (regardless of whether the net income performance goal is met), if during the performance period the Company’s Common Stock satisfies the First Trigger, as defined in the Long-Term Incentive Plan for Fiscal 2012.

 

3.                                      Restrictions.  The Grantee represents that he is accepting the Award Shares without a view toward distribution of said Award Shares and that he will not sell, assign, transfer, pledge or otherwise encumber the Award Shares during the period commencing on the Date of Award and ending on the date the restrictions applicable to such Award Shares are released pursuant to paragraph 4 of this Agreement (“Restrictive Period”).

 

4.                                      Release of Restrictions. Subject to the provisions of paragraphs 2 and 5, the restrictions described in paragraph 3 above shall be released with respect to 331/3% of the Award Shares on May 31, 2015, 331/3% of the Award Shares on May 31, 2016, and 331/3% of the Award Shares on May 31, 2017, except as follows:

 

(a)                                 In General.  Subject to the provisions of paragraph 2, if the Grantee’s employment with the Company and all subsidiaries of the Company terminates prior to the last day of the Restrictive Period for any reason other than death, Disability or Retirement, the

 

 

Grantee shall forfeit to the Company all Award Shares not previously released from the restrictions of paragraph 3 hereof.

 

(b)                                 Retirement, Death or Disability.  Subject to the provisions of paragraph 2, if the Grantee’s employment with the Company and all subsidiaries of the Company terminates by reason of Retirement, Death or Disability prior to the last day of the Restrictive Period, the Restrictive Period shall terminate in accordance with the restriction release schedule set forth above in the first clause of this paragraph 4 as to all Award Shares.  For this purpose, (i) “Retirement” means the Grantee’s voluntary termination of employment, or his termination of employment by the Company or a subsidiary without Cause (as defined in the Plan), when he has (a) attained age 65 or (b) attained age 55 and his age plus the number of his consecutive years of service with the Company and subsidiaries is at least 75; and  (ii) “Disability” means the inability of the Grantee to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.

 

(c)                                  Restrictive Covenant.  If at any time prior to the Award Shares’ release from the restrictions hereunder, the Grantee, without the Company’s express written consent, directly or indirectly, alone or as a member of a partnership, group, or joint venture or as an employee, officer, director, or greater than 1% stockholder of any corporation, or in any capacity engages in any activity which is competitive with any of the businesses conducted by the Company or its affiliated companies at any time during the Grantee’s term of employment, the Grantee shall forfeit to the Company all Award Shares not previously released from the restrictions of paragraph 3 hereof.

 

5.                                      Change in Control.  In the event of a Change in Control of the Company, whether or not such change has the prior written approval of the Continuing Directors, the Grantee shall be entitled to that number of Award Shares that would be available if the cumulative net income performance goal were met at the target level, and the Restrictive Period shall terminate as to all such Award Shares.

 

6.                                      Change in Outstanding Shares.  In the event of any change in the outstanding shares of Common Stock occurring through stock splits, stock dividends, stock consolidations, spin-offs, other distributions of assets to stockholders or assumption or conversion of outstanding Awards due to an acquisition after the Date of Award, the Award Shares shall be treated in the same manner in any such transaction as other shares of Common Stock. Any additional shares of Common Stock received by the Grantee with respect to the Award Shares in any such transaction shall be subject to the same restrictions as are then applicable to those Award Shares for which the additional shares have been issued.

 

7.                                      Rights of Grantee.  As the holder of the Award Shares, the Grantee is entitled to all of the rights of a stockholder of AAR CORP. with respect to any of the Award Shares, when issued, including, but not limited to, the right to receive dividends declared and payable since the Date of Award; provided, however, that such dividends shall be accumulated and held by the Company until the performance condition described in paragraph 2 is met, or if earlier, as described in paragraph 5, at which time such accumulated dividends shall be paid to the Grantee in cash to the extent the performance condition is met or if applicable, as described in Section 5.

 

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Any accumulated or unpaid dividends relating to Award Shares that are forfeited shall also be forfeited.

 

8.                                      Shares.  In aid of the restrictions set forth in paragraph 3, the Grantee will be required to execute a stock power in favor of the Company which will be cancelled upon release of restrictions with respect to Award Shares released.  Award Shares shall be held by the Company in electronic book entry form on the records of the Company’s Transfer Agent, together with the executed stock power, for the account of the Grantee until such restrictions are released pursuant to the terms hereof, or such Award Shares are forfeited to the Company as provided by the Plan or this Agreement.  The Grantee shall be entitled to the Award Shares as to which such restrictions have been released, and the Company agrees to issue such Award Shares in electronic form on the records of the Transfer Agent. Upon request by the Grantee, the Transfer Agent will transfer such released Award Shares in electronic form to the Grantee’s broker for the Grantee’s account or issue certificates in the name of the Grantee representing the Award Shares for which restrictions have been released.

 

9.                                      Legend.  The Company may, in its discretion, place a legend or legends on any electronic shares or certificates representing Award Shares issued to the Grantee that the Company believes is required to comply with any law or regulation.

 

10.                               Committee Powers.  The Committee may subject the Award Shares to such conditions, limitations or restrictions as the Committee determines to be necessary or desirable to comply with any law or regulation or with the requirements of any securities exchange. At any time during the Restrictive Period, the Committee may reduce or terminate the Restrictive Period otherwise applicable to all or any portion of the Award Shares.

 

11.                               Withholding Taxes.  The Grantee shall pay to the Company an amount sufficient to satisfy all minimum tax withholding requirements, including those arising under federal, state and local income tax laws, prior to the delivery of any Award Shares.  Payment of the minimum withholding requirement may be made by one or more of the following methods:  (a) in cash, (b) in cash received from a broker-dealer to whom the Grantee has submitted irrevocable instructions to deliver the amount of withholding tax to the Company from the proceeds of the sale of shares of Common Stock subject to the Award, (c) by delivery to the Company of other Common Stock owned by the Grantee that is acceptable to the Company, valued at its fair market value on the date of payment, (d) by certifying to ownership by attestation of such previously owned Common Stock, or (e) by having shares of Common Stock withheld from the Award Shares otherwise distributable to the Grantee.  Payment shall be made pursuant to the on-line procedures set forth on the AAR Stock Benefit Plan online web site through Smith Barney (www.benefitaccess.com).

 

12.                               Postponement of Distribution.  Notwithstanding anything herein to the contrary, the distribution of any portion of the Award Shares shall be subject to action by the Board taken at any time in its sole discretion (a) to effect, amend or maintain any necessary registration of the Plan or the Award Shares distributable in satisfaction of this Award under the Securities Act of 1933, as amended, or the securities laws of any applicable jurisdiction, (b) to permit any action to be taken in order to (i) list such Award Shares on a stock exchange if the Common Stock is then listed on such exchange or (ii) comply with restrictions or regulations incident to the maintenance of a public market for its Shares of Common Stock, including any rules or

 

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regulations of any stock exchange on which the Award Shares are listed, or (c) to determine that such Award Shares and the Plan are exempt from such registration or that no action of the kind referred to in (b)(ii) above needs to be taken; and the Company shall not be obligated by virtue of any terms and conditions of this Award or any provision of this Agreement or the Plan to issue or release the Award Shares in violation of the Securities Act of 1933 or the law of any government having jurisdiction thereof.  Any such postponement shall not shorten the term of any restriction attached to the Award Shares and neither the Company nor its directors or officers shall have any obligation or liability to the Grantee or to any other person as to which issuance under the Award Shares was delayed.

 

13.                               Recoupment.  Notwithstanding any other provision of this Agreement, to the extent required by applicable law, including the Dodd-Frank Wall Street Reform and Consumer Protection Act, or pursuant to the Company’s policy as may be in effect, the Company shall have the right to seek recoupment of all or any portion of an Award (including by forfeiture of any outstanding Award Shares or by the Grantee’s remittance to the Company of Award Shares pursuant to which the restrictions previously lapsed or of a cash payment equal to Award Shares pursuant to which the restrictions previously lapsed).  The value with respect to which such recoupment is sought shall be determined by the Company.  The Company shall be entitled, as permitted by applicable law, to deduct the amount of such payment from any amounts the Company may owe to the Grantee.

 

14.                               Miscellaneous.

 

(a)                                 The Award and this Agreement shall be construed, administered and governed in all respects under and by the laws of the State of Illinois.

 

(b)                                 Capitalized terms used herein and not defined herein will have the meanings set forth in the Plan.

 

(c)                                  Nothing in the Award shall confer on the Grantee any right to be or to continue in the employ of the Company or any of its subsidiaries or shall interfere in any way with the right of the Company or any of its subsidiaries to terminate the employment of the Grantee at any time for any reason or no reason.

 

(d)                                 This Agreement has been examined by the parties hereto, and accordingly the rule of construction that ambiguities be construed against a party which causes a document to be drafted shall have no application in the construction or interpretation hereof.  If any part of this Agreement is held invalid for any reason, the remainder hereof shall nevertheless remain in full force and effect.

 

(e)                                  This Agreement constitutes the entire agreement between the parties concerning the subject matter hereof and any prior understanding or representation of any kind antedating this Agreement concerning such subject matter shall not be binding upon either party except to the extent incorporated herein; provided, however, that this Agreement, including paragraph 4, shall be subject to the provisions of any written employment or severance agreement that has been or may be executed by the Grantee and the Company, and the provisions in such employment or severance agreement concerning the Award shall supercede any inconsistent or contrary provision of this Agreement.  No consent, waiver, modification or

 

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amendment hereof, or additional obligation assumed by either party in connection herewith, shall be binding unless evidenced by a writing signed by both parties and referring specifically hereto.  No consent, waiver, modification or amendment with respect hereto shall be construed as applicable to any past or future events other than the one in respect of which it was specifically made.

 

(f)                                   This Agreement shall be construed consistent with the provisions of the Plan and in the event of any conflict between the terms of this Agreement and the terms of the Plan, the terms of the Plan shall control and any terms of this Agreement which conflict with Plan terms shall be void.

 

Questions concerning the provisions of this Agreement should be directed to the Company’s Corporate Secretary: 630/227-2050; fax 630/227-2059.

 

*****************

 

By accepting this Agreement, you irrevocably agree to be bound by the terms hereof.  To accept this Agreement, please follow the procedures set forth below:

 

Step 1:      View your Award Summary (confirm that the number of shares awarded matches that shown in the Award grant letter you received from the Company).

 

Step 2:      Read and review the documentation.

 

Step 3:      Confirm the review/acceptance of your Award and this Agreement.

 

Step 4:      Receive an online confirmation of your acceptance.

 

5Exhibit 10.13

 

AAR CORP.

 

NON-EMPLOYEE DIRECTOR NON-QUALIFIED STOCK OPTION AGREEMENT

(“Agreement”)

 

1.  Subject to the provisions set forth herein and the terms and conditions of the AAR CORP. Stock Benefit Plan (“Plan”), the terms of which are hereby incorporated by reference, and in consideration of the agreements of «Name» (“Grantee”) herein provided, AAR CORP., a Delaware corporation (“Company”), hereby grants to the Grantee an option entitling the Grantee to purchase from the Company common stock of the Company, par value $1.00 per share (“Common Stock”), in the number of shares at the purchase price per share, and on the schedule, set forth below (“Option”).

 

	
Number   of Shares Subject to Option:
    	
 
    	
3,500
    
	
(subject   to adjustment pursuant to the terms of this Agreement.)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Option   Price Per Share:
    	
 
    	
$«Price»
    
	
(subject   to adjustment pursuant to the terms of this Agreement.)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date   of Grant:
    	
 
    	
«Date»
    

 

Option Vesting Schedule:

 

	
Number of Shares Becoming
   Subject to Exercise
    	
 
    	
Date First
   Exercisable
    
	
 
    	
 
    	
 
    
	
First   875 shares of Grant
    	
 
    	
«IncrDate1»
    
	
Second   875 shares of Grant
    	
 
    	
«IncrDate2»
    
	
Third   875 shares of Grant
    	
 
    	
«IncrDate3»
    
	
Fourth   875 shares of Grant
    	
 
    	
«IncrDate4»
    

 

Each of the above option increments shall expire on «Expiry» (“Expiration Date” of the Option) or upon the earlier expiration of the Option as provided in this Agreement.

 

 

In the event the Grantee’s membership on the Board terminates within one year following a Change in Control whether or not such Change in Control has the prior written approval of a majority of the Continuing Directors, and notwithstanding any conditions or restrictions contained in this Agreement, the Option shall become immediately exercisable on the date of such termination with respect to all shares of Common Stock covered thereby, whether vested or not, and not previously purchased upon exercise of the Option and shall remain so exercisable until the Option expires as provided in paragraph 1 or 3 herein.

 

For purposes of this Agreement, the following terms have the meaning set forth below:

 

(a)                                 “Permitted Assignment” means an assignment in writing approved by the Company, and otherwise meeting the requirements of the Plan document, of all or any portion of this award to (i) Grantee’s spouse or lineal descendent(s), (ii) the trustee of a trust for the primary benefit of Grantee’s spouse or lineal descendent(s), (iii) a partnership of which the Grantee’s spouse or lineal descendent(s) are the only partners, or (iv) a tax exempt organization as defined in Section 501(c)(3) of the Internal Revenue Code, for which the Grantee does not receive any consideration.

 

(b)                                 “Retirement” means the voluntary termination of membership on the Board at or after age 65 with not less than five (5) consecutive years of service as a non-employee director of the Company.

 

2.                                      The exercise of the Option is conditioned upon the acceptance by the Grantee of the terms hereof as evidenced by the Grantee’s execution of this Agreement and return of an executed copy to the Secretary of the Company within thirty (30) days 

 

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from the date of the cover letter from the Secretary transmitting original copies to the Grantee for execution.

 

3.                                      (a)                                 If the Grantee’s service on the Board is terminated for any reason, other than for Retirement, death or Disability, the Option of Grantee shall terminate on the earlier to occur of (i) three months after termination of service on the Board or (ii) the date that the Option expires in accordance with its terms.

 

(b)                                 If the Grantee’s service on the Board is terminated by reason of Retirement, the Option shall remain exercisable by the retired Grantee until the Option expires by its terms and may be exercised by the retired Grantee in the same manner and to the same extent as if he had continued service on the Board during that period; provided, however, that if the Grantee dies before the Option expires, the Option shall be exercisable only by the Successor of the deceased Grantee (as defined in the Plan) to the extent that the deceased Grantee was entitled at the date of the Grantee’s death.

 

(c)                                  If (i) the Grantee’s service on the Board is terminated by reason of death or (ii) the Grantee dies within three months after the termination of his service on the Board, the Option shall expire on the earlier to occur of one year after Grantee’s death or the Expiration Date of the Option; provided, however, that during such period, the Option shall be exercisable only by the Successor of the deceased Grantee to the extent, if any, that the deceased Grantee was entitled at the date of the Grantee’s death.

 

(d)                                 If the Grantee’s service on the Board is terminated by reason of Disability, the Option shall expire on the earlier to occur of one year after termination of service on the Board or the date the Option expires in accordance with its terms, and 

 

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during said period the Option may be exercised by the disabled Grantee with respect to the same number of shares, in the same manner and to the same extent as if the Grantee had continued service on the Board during such period.

 

(e)                                  If at any time prior to expiration of this Option, the Grantee, without the Company’s express written consent, directly or indirectly, alone or as a member of a partnership, group or joint stock venture or as an employee, officer, director, or stockholder of any corporation, or in any capacity engages in any activity which is competitive with any of the businesses conducted by the Company or its Affiliated Companies from time to time or at any time during the Grantee’s term of employment, the Grantee shall forfeit and return all Award Shares not previously released from the restrictions of Section 1 hereof.

 

4.                                      Written notice of an election to exercise any portion of the Option, specifying the portion thereof being exercised and the exercise date, shall be given by the Grantee, or the Grantee’s personal representative in the event of the Grantee’s death or disability necessitating a Court approved personal representative, by delivering such notice to the Secretary of the Company, accompanying such notice with (i) payment in full of the purchase price of any shares to be purchased, which may be made in cash, or in the form of a certified check or a cashier’s check issued by a federally insured bank or federally insured savings and loan association, in all cases made payable to AAR CORP., and as set forth in the Plan, or by surrendering a number of shares of Common Stock of the Company with a Fair Market Value (as defined in the Plan) on the date of exercise equal to the purchase price, or by directing the Company to withhold such number of shares otherwise issuable upon exercise of such Option having an aggregate Fair Market 

 

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Value on the date of exercise equal to the purchase price, or by any combination of the above, and (ii) payment of an amount sufficient to satisfy any applicable withholding requirements as provided for in Section 13 below.  Any exercise of the Option shall be effective as of the later of the dates specified in such notice and the date the notice and accompanying payment are actually received by the Secretary of the Company.

 

5.                                      Any exercise of an Option shall be subject to action by the Board taken at any time in its sole discretion (i) to effect, amend or maintain any necessary registration of the Plan or the shares of Common Stock issuable upon exercise of the Option under the Securities Act of 1933, as amended, or the securities laws of any applicable jurisdiction, (ii) to permit any action to be taken in order to (A) list such shares on a stock exchange if the shares are then listed on such exchange or (B) comply with restrictions or regulations incident to the maintenance of a public market for its shares of Common Stock, including any rules or regulations of any stock exchange on which such shares are listed, or (iii) to determine that such shares and the Plan are exempt from such registration or that no action of the kind referred to in (ii)(B) above needs to be taken; and the Company shall not be obligated by virtue of any terms and conditions of the Option, or any provision of this Agreement or the Plan, to recognize an exercise of the Option or to sell or issue shares of Common Stock in violation of the Securities Act of 1933 or the law of any government having jurisdiction thereof.  Any such postponement shall not extend the Expiration Date of the Option, and neither the Company nor its directors or officers shall have any obligation or liability to the Grantee or to any other person with respect to any shares as to which the Option shall lapse because of such postponement.  If deemed necessary by the Committee, the Grantee may be required to represent at the time of 

 

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each exercise of the Option that the shares purchased are being acquired for investment and not with a view to distribution; and the Company may place a legend on the related stock certificate to indicate that the stock may not be sold or otherwise disposed of except in accordance with the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, including, but not limited to Rule 144.

 

6.                                      Notwithstanding any provision of this Agreement to the contrary, the Company shall not be obliged to issue or transfer any of its Common Stock to Grantee upon exercise of the Option, if the Committee or the Board of Directors of the Company determines that the issuance or transfer of such Common Stock, or payment of such amount of cash, would be in violation of any covenant in any of the Company’s loan agreements or other contracts.

 

7.                                      Any increase or decrease in the number of outstanding shares of Common Stock of the Company occurring through stock splits, stock dividends, stock consolidations, spin offs, other distributions of assets to shareholders or assumption or conversion of outstanding Options due to an acquisition after the Date of Grant of the Option shall be reflected proportionately in the number of shares of Common Stock subject to the Option; and a proportionate reduction or increase, as applicable, shall be made in the Option Price Per Share hereunder.  Any fractional shares resulting from such adjustment shall be eliminated.  If changes in capitalization other than those considered above shall occur, the Board of Directors of the Company shall make such adjustment in the number or class of shares purchasable upon exercise of the Option and in the Option Price Per Share as the Board in its discretion may consider appropriate, and all such adjustments shall be conclusive upon all persons.

 

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8.                                      The Option may be exercised only by the Grantee during the Grantee’s lifetime and may not be transferred other than by a Permitted Assignment, will or the applicable laws of descent or distribution.  The Option shall not otherwise be transferred, assigned, pledged or hypothecated for any purpose whatsoever and is not subject, in whole or in part, to execution, attachment, or similar process.  Any attempted assignment, transfer, pledge or hypothecation or other disposition of the Option, other than in accordance with the terms set forth herein, shall be void and of no effect.

 

9.                                      Neither the Grantee nor any other person entitled to exercise the Option under the terms hereof shall be, or have any of the rights or privileges of, a stockholder of the Company in respect of any of the shares of Common Stock issuable on exercise of the Option, unless and until such shares shall have been actually issued.

 

10.                               In the event the Option shall be exercised in part, the Company may require that this Agreement be delivered by the Grantee to the Company for the purpose of making appropriate notation thereon, or of otherwise reflecting, in such manner as the Company shall determine, such partial exercise.  In the event the Option shall be exercised in whole, this Agreement shall be surrendered to the Company for cancellation. In the event that a change in the number or designation of the Common Stock shall be made, the Company may require the Grantee to surrender this Agreement to the Company for the purpose of making appropriate notation thereon, or of otherwise reflecting, such change in the number or designation of the Common Stock.

 

11.                               When the Option expires as herein provided, such expiration shall occur at the Company’s close of business on the date of expiration.

 

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12.                               Nothing in the Option shall constitute or be evidence of any agreement or understanding, express or implied, that the Company shall retain a director for any period of time, or at any particular rate of compensation.  The execution of this agreement by the Grantee conclusively evidences the Grantee’s intent to continue to serve as a director of the Company for the remainder of the Grantee’s term during which the Option was granted.

 

13.                               Upon any exercise of the Option, the Grantee shall remit to the Company an amount necessary to satisfy applicable withholding requirements including those arising under state and federal income tax laws.  If the Grantee does not remit such amount, the Company may withhold all or a portion of any compensation then or in the future owed to the Grantee as necessary to satisfy such requirements.

 

The Grantee may satisfy the income tax withholding obligation in connection with such Option in whole or in part by (i) directing the Company to withhold a portion of the shares otherwise distributable to the Grantee or (ii) transferring to the Company shares of Common Stock of the Company previously acquired by the Grantee having a Fair Market Value (as defined in the Plan) on the date such shares are transferred to the Company equal to the amount of such withholding or lesser portion thereof as may be desired by the Grantee.  A Grantee’s election pursuant to the preceding sentence must be made on or prior to the date as of which income is realized by the Grantee in connection with such Option and must be irrevocable.  In lieu of a separate election on each Taxable Date (as defined in the Plan), the Grantee may file a blanket election with the Committee which shall govern all future Taxable Dates until revoked by the Grantee.

 

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14.                               The Option shall be exercised in accordance with such administrative regulations as the Committee shall from time to time adopt.

 

15.                               The Option, and this Agreement, shall be construed, administered and governed in all respects under and by the laws of the State of Illinois.

 

16.                               This Agreement has been examined by the parties hereto, and accordingly the rule of construction that ambiguities be construed against a party which causes a document to be drafted shall have no application in the construction or interpretation hereof.  If any part of this Agreement is held invalid for any reason, the remainder hereof shall nevertheless remain in full force and effect.

 

17.                               This Agreement constitutes the entire agreement between the parties concerning the subject matter hereof and any prior understanding or representation of any kind antedating this Agreement concerning such subject matter shall not be binding upon either party except to the extent incorporated herein.  No consent, waiver, modification or amendment hereof, or additional obligation assumed by either party in connection herewith, shall be binding unless evidenced by a writing signed by both parties and referring specifically hereto.  No consent, waiver, modification or amendment with respect hereto shall be construed as applicable to any past or future events other than the one in respect of which it was specifically made.

 

18.                               This Agreement shall be construed consistent with the provisions of the Plan and in the event of any conflict between the terms of this Agreement and the terms of the Plan, the terms of the Plan shall control.

 

19.                               Capitalized terms used herein and not defined herein will have the meaning set forth in the Plan.

 

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IN WITNESS WHEREOF, this Agreement has been executed for the Company by its duly authorized officer on the 23rd day of August, 2004.

 

	
 
    	
AAR   CORP.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
Howard   A. Pulsifer
    
	
 
    	
Title:
    	
Vice   President and Secretary
    

 

The undersigned hereby accepts the foregoing Option and the terms and conditions thereof on this          day of                               , 2004.

 

	
 
    	
 
    
	
 
    	
Director
    
	
 
    	
Name:
    	
    «Name»
    

 

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