Document:

EX-10.2  Stock Option Plan

 

EXHIBIT 10.2

THE GOODYEAR TIRE & RUBBER COMPANY

STOCK OPTION PLAN

FOR

HOURLY BARGAINING UNIT EMPLOYEES AT DESIGNATED LOCATIONS

(AS AMENDED DECEMBER 4, 2001)

 

	1.	 	GENERAL PROVISIONS.

	 	(a)	 	Adoption; Effective Date. The Plan has been adopted by the Board of
Directors of The Goodyear Tire & Rubber Company on and effective as of
December 4, 2000.
	 
	 	(b)	 	Purpose. The purpose of the Plan is to grant options to purchase
shares of the Common Stock of the Company to eligible hourly employees
of the Company and designated domestic subsidiaries at Designated
Locations who are members of one or more of the local unions of the
United Steelworkers of America, thereby strengthening the common
interests of the shareholders of the Company and such employees in the
long term growth, profitability and success of the Company.
	 
	 	(c)	 	Term. The Plan shall remain in effect until September 30, 2001, unless
sooner terminated by the Board of Directors. Termination of the Plan
shall not affect stock options granted under the Plan which are then
outstanding.

	2.	 	DEFINITIONS. For the purposes of the Plan, the following terms shall have
the following meanings.

	 	(a)	 	“Active
Employee” means a full-time hourly employee of the Company or
a Designated Subsidiary who is also a member of, and/or represented
by, one or more of the Local Unions and is, on the relevant date, on
the active payroll of the Company or a Designated Subsidiary.
	 
	 	(b)	 	“Average Annual Hours
Worked” means, with respect to the period and to
the Eligible Employee in respect of which a determination thereof is
being or to be made, the average of the hours worked by such Eligible
Employee during the two years (i) ended October 31 in the three year
period ended October 31, 2000 (in the case of a determination made
pursuant to Section 5 (a) of the Plan) or (ii) ended August 31 in the
three year period ended August 31, 2001 (in the case of a
determination made pursuant to Section 5(b) of the Plan), during which
the Eligible Employee worked the most hours. In respect of each
Eligible Employee who has a continuous service date as a Bargaining
Unit Employee that is less than two years and more than six months
prior to October 31, 2000 or August 31, 2001, as the case may be, the
hours worked for the year during which his or her continuous service
date occurs shall be determined by annualizing the average hours
worked by such Eligible Employee during each full calendar month
during the period beginning on his or her continuous service date and
ending on the next following October 31 or August 31, as the case may
be. If the continuous service date of the Eligible Employee is one
year or less, but more than six (6) months, prior to October 31, 2000
or August 31, 2001, as the case may be, then the “Average Annual Hours
Worked” shall be equal to the actual hours worked in the case of a
full year or the annualized average hours worked, determined as
provided in the preceding sentence, in the case of a partial year.
	 
	 	(c)	 	“Bargaining Unit
Agreement” means any of, and “Bargaining Unit
Agreements” means and includes all of, the Company-Wide Agreement
(including the related Supplemental Agreement(s)), the Fayetteville
Agreement, the Freeport

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	Agreement, the Tyler Agreement, the Buffalo General Agreement, and the
Huntsville General Agreement, as the case may be, each as in effect on
and as of December 4, 2000.

	 	(d)	 	“Bargaining Unit
Employee” means any person who, at the relevant time,
is (i) an Employee of the Company or a Designated Domestic Subsidiary
at one of the Designated Locations and (ii) a member of, and/or
represented by, the Local Union representing Employees at such
Designated Location.
	 
	 	(e)	 	“Board of
Directors” means the Board of Directors of the Company.
	 
	 	(f)	 	“Buffalo General
Agreement” means the General Agreement, dated and
effective as of October 25, 2000, between Goodyear Dunlop Tires North
America, Ltd and Local Union No. 135 of the USWA, as in effect on and
as of December 4, 2000.
	 
	 	(g)	 	“Code” means the Internal Revenue Code of 1986, as amended and in
effect from time to time, or any successor statute thereto, together
with the published rulings, regulations and interpretations duly
promulgated thereunder.
	 
	 	(h)	 	“Common Stock” means the Common Stock, without par value, of the
Company, or any security issued by the Company in substitution or
exchange therefore or in lieu thereof.
	 
	 	(i)	 	“Company” means The Goodyear Tire & Rubber Company, an Ohio
corporation, or any successor corporation.
	 
	 	(j)	 	“Company-Wide
Agreement” means the Agreement, dated effective October
25, 2000, together with the “Supplemental Agreement” relating to a
Designated Location among the Company, the USWA and the relevant Local
Union (or Unions, as the case may be), as in effect on and as of
December 4, 2000.
	 
	 	(k)	 	“Designated
Location” means any of, and “Designated
Locations” means
two or more or all of, the tire and/or rubber products manufacturing
facilities of the Company and its Designated Subsidiaries at the
following locations: Akron (Plant 2), Ohio: Gadsden, Alabama; St.
Marys, Ohio; Lincoln, Nebraska; Topeka, Kansas; Danville, Virginia;
Marysville, Ohio; Union City, Tennessee; Sun Prairie, Wisconsin;
Fayetteville, North Carolina; Freeport, Illinois; Tyler, Texas;
Buffalo, New York; and Huntsville, Alabama.
	 
	 	(l)	 	“Designated
Subsidiary” means any of, and “Designated Subsidiaries”
means any two or more or all of, Goodyear Dunlop Tires North America,
Ltd., an Ohio limited liability company, and any successor entity, and
any other domestic corporation or other entity so designated in
writing by the Board of Directors.
	 
	 	(m)	 	“Eligible
Employee” means any person who (i) satisfies the eligibility
criteria set forth at Section 6(a) of the Plan at December 4, 2000, or
(ii) satisfies the eligibility criteria set forth at Section 6(b) of
the Plan at September 3, 2001.
	 
	 	(n)	 	“Employee” means each person who, at the relevant time, is on the
active payroll of, or on Layoff or a Leave of Absence from, an
Employer at one of the Designated Locations.
	 
	 	(o)	 	“Employer” means the Company and/or a Designated Subsidiary.
	 
	 	(p)	 	“Fair Market
Value” means, in respect of any date on or as of which a
determination thereof is being or to be made, the average of the high
and low per share sale prices of the Common Stock reported on the New
York Stock Exchange Composite Transaction tape on such date, or, if
the Common Stock was not traded

X-10.2-2

 

	 
	on such date, on the next day on which sales of the shares of the
Common Stock were reported on the New York Stock Exchange Composite
Transactions tape.

	 	(q)	 	“Fayetteville
Agreement” means the Agreement, dated and effective as
of October 25, 2000, between the Company (as the successor to the
Kelly-Springfield Tire Company) and Local Union No. 959 of the USWA,
as in effect on and as of December 4, 2000.
	 
	 	(r)	 	“Freeport
Agreement” means the Agreement, dated and effective as of
October 31, 2000, between the Company (as the successor to The
Kelly-Springfield Tire Company) and Local Union No. 745 of the USWA,
as in effect on and as of December 4, 2000.
	 
	 	(s)	 	“Grantee” means any Eligible Employee of the Company who is granted a
Stock Option under the Plan and has entered into a grant agreement in
respect of such Stock Option, which Stock Option remains outstanding.
	 
	 	(t)	 	“Huntsville General
Agreement” means the General Agreement, dated and
effective as of October 25, 2000, between Goodyear Dunlop Tires North
America, Ltd and Local Union No. 915 of the USWA, as in effect on and
as of December 4, 2000.
	 
	 	(u)	 	“Layoff” shall mean: (i) with respect to Bargaining Unit Employees
covered by the Company-Wide Agreement, a layoff with recall rights as
described at Section 1(a) of Article X of the Company-Wide Agreement
(and at any applicable section of the relevant “Supplemental
Agreement”); (ii) with respect to Bargaining Unit Employees covered by
the Fayetteville Agreement, a layoff with recall rights as described
at Section 8 of Article VII of the Fayetteville Agreement; (iii) with
respect to Bargaining Unit Employees covered by the Freeport
Agreement, a layoff with recall rights as described at Section 8 of
Article VII of the Freeport Agreement; (iv) with respect to Bargaining
Unit Employees covered by the Tyler Agreement, a layoff with recall
rights as described at Section 13 and Section 14 of Article VII of the
Tyler Agreement; (v) with respect to Bargaining Unit Employees covered
by the Buffalo General Agreement, a layoff with recall rights as
described at Sections 7.08 through 7.15, inclusive, of Article VII of
the Buffalo General Agreement; and (vi) with respect to Bargaining
Unit Employees covered by the Huntsville General Agreement, a layoff
with recall rights as described at Sections 9.09 and 9.10 of the
Huntsville Agreement.
	 
	 	(v)	 	“Leave of
Absence” shall mean: (i) with respect to Bargaining Unit
Employees covered by the Company-Wide Agreement, a leave of absence
authorized by the Employer as provided for by the provisions of
Section 1(b) of Article X of the Company-Wide Agreement (and at any
applicable section of the relevant “Supplemental Agreement”); (ii)
with respect to Bargaining Unit Employees covered by the Fayetteville
Agreement, a leave of absence authorized by the Employer as provided
for by the provisions of Section 3 of Article VII of the Fayetteville
Agreement; (iii) with respect to Bargaining Unit Employees covered by
the Freeport Agreement, a leave of absence authorized by the Employer
as provided for by the provisions of Section 4 of Article VII of the
Tyler Agreement; (v) with respect to Bargaining Unit Employees covered
by the Buffalo General Agreement, a leave of absence authorized by the
Employer as provided for by the provisions of Section 7.18 of the
Buffalo General Agreement; and (vi) with respect to Bargaining Unit
Employees covered by the Huntsville General Agreement, a leave of
absence authorized by the Employer as provided for by the provisions
of Section 9.11 of the Huntsville General Agreement.

X-10.2-3

 

	 	(w)	 	“Local Union” means any one of , and “Local Unions” means any two or
more or all of, the local unions of the United Steelworkers of
America, A.F.L-C.I.O.-C.L.C. representing certain Employees of the
Employers at the respective Designated Locations listed below:

	 	 	 	 	 
	Designated Location	 	Local Union
	
	 	

	Akron, Ohio
	 	Local 2
	
	
	
	

	Gadsden, Alabama
	 	Local 12
	
	
	
	

	Tonawonda (Buffalo), New York
	 	Local 135
	
	
	
	

	St Marys, Ohio
	 	Local 200
	
	
	
	

	Lincoln, Nebraska
	 	Local 286
	
	
	
	

	Topeka, Kansas
	 	Local 307
	
	
	
	

	Freeport, Illinois
	 	Local 745
	
	
	
	

	Tyler, Texas
	 	Local 746
	
	
	
	

	Danville, Virginia
	 	Local 831
	
	
	
	

	Marysville, Ohio
	 	Local 843
	
	
	
	

	Union City, Tennessee
	 	Local 878
	
	
	
	

	Sun Prairie, Wisconsin
	 	Local 904
	
	
	
	

	Huntsville, Alabama
	 	Local 915
	
	
	
	

	Fayetteville, North Carolina
	 	Local 959

	 	(x)	 	“P&I
Agreement” means any of the, and “P&I Agreements” means and
includes any two or more or all of, the following agreements: (i) the
Pension, Insurance and Service Award Agreement, dated effective
October 25, 2000, among the Company the USWA and Local Unions Nos. 2,
12, 200, 286, 307, 831, 843, 878 and 904 (the “Goodyear P&I
Agreement”); (ii) the Pension, Insurance and Service Award Agreement,
dated effective May 9, 1997 (as amended), between the Company (as the
successor of The Kelly-Springfield Tire Company), the USWA and Local
Union No. 959 (the “Fayetteville P&I Agreement”), (iii) the Pension,
Insurance and Service Award Agreement, dated September 7, 1997 (as
amended), between the Company, the USWA and Local Union No. 746 (the
“Tyler P&I Agreement”), (iv) the Pension, Insurance and Service Award
Agreement, dated May 9, 1997 (as amended), between the Company, the
USWA and Local Union No. 745 (the “Freeport P&I Agreement”), (v) the
Agreement on Pension, Service Award and Insurance Benefits between
Goodyear Dunlop Tires North America, Ltd. and Local Union No. 135,
dated October 27, 2000 (the “Buffalo P&I Agreement”); and (vi) the
Agreement for Pension, Service Award and Insurance Benefits between
Goodyear Dunlop Tires North America, Ltd. and Local Union No. 915,
dated October 27, 2000 (the “Huntsville P&I Agreement”).
	 
	 	(y)	 	“Plan” means The Goodyear Tire & Rubber Company Stock Option Plan for
Hourly Bargaining Unit Employees at Designated Locations.
	 
	 	(z)	 	“Retirement” shall, for the purposes of the Plan, be deemed to have
occurred with respect to any Grantee when such Grantee ceases to be an
Employee of an Employer and is entitled to receive a Normal Retirement
Pension, a Disability Retirement Pension or an Early Retirement
Pension in accordance with the applicable provisions of the P&I
Agreement that applies to such Grantee.
	 
	 	(aa)	 	“Seniority
Status” shall have the meaning specified at: (i) the first
two paragraphs of Section 1 of Article X, and at subsection (d) of
Section 1 of Article X, of the Company-Wide Agreement with respect to
Bargaining Unit Employees covered by the Company-Wide Agreement; (ii)
Article VIII of the Freeport Agreement with respect to Bargaining Unit
Employees covered by the Freeport Agreement; (iii) Article VII of the
Fayetteville Agreement with respect to Bargaining Unit Employees
covered by the Fayetteville Agreement; (iv) Article VIII of the Tyler
Agreement with respect to Bargaining Unit Employees covered by the
Tyler

X-10.2-4

 

	 
	Agreement; (v) Section 9.01 of the Huntsville General Agreement with
respect to Bargaining Unit Employees covered by the Huntsville General
Agreement; or (vi) Article VII of the Buffalo General Agreement with
respect to Bargaining Unit Employees covered by the Buffalo General
Agreement.

	 	(bb)	 	“Stock Option” means any option to purchase shares of Common Stock
granted pursuant to the provisions of the Plan, each of which shall be
a nonstatutory stock option not governed by Section 421 or 422 of the
Code.
	 
	 	(cc)	 	“Tyler Agreement” means the Agreement, dated and effective as of
October 25, 2000, between the Company and Local Union No. 746 of the
USWA, as in effect on and as of December 4, 2000.
	 
	 	(dd)	 	“USWA” means the United Steelworkers of America, A.F.L.-C.I.O.-C.L.C.

	3.	 	SHARES OF COMMON STOCK
SUBJECT TO THE PLAN.

	 	(a)	 	Number of Shares Issuable
Under the Plan. The maximum number of shares
of Common Stock which may be issued pursuant to the Plan, subject to
adjustment as provided in Section 3(b) of the Plan, shall be three
million five-hundred thousand (3,500,000). The shares of Common Stock
which may be issued under the Plan may be authorized and unissued
shares or issued shares which have been reacquired by the Company. No
fractional share of the Common Stock shall be issued under the Plan.
Any fractional share of Common Stock shall be settled in cash at the
Fair Market Value thereof on the relevant date.
	 
	 	(b)	 	Adjustments Upon Changes in
Capital Structure. In the event of any
change in the capital structure, capitalization or Common Stock of the
Company, such as a stock dividend, stock split, recapitalization,
merger, consolidation, split-up, combination or exchange of shares or
other form of reorganization, or any other change affecting the Common
Stock, such proportionate adjustments, if any, as the Board of
Directors in its discretion may deem appropriate to reflect such
change may be made with respect to: (i) the maximum number of shares
of Common Stock which may be (1) issued pursuant to the Plan, and (2)
the subject of, or issued pursuant to, any Stock Option granted
pursuant to the Plan; (ii) the number of shares of Common Stock
subject to any outstanding Stock Option; (iii) the per share exercise
price in respect of any outstanding Stock Option; and (iv) any other
term or condition of any Stock Option affected by any such change.

	4.	 	ADMINISTRATION.

	 	(a)	 	The Committee. The Plan shall be administered by a committee (the
“Committee”) to be appointed from time to time by the Board of
Directors. The Committee shall be comprised of at least five members.
The Executive Vice President and Chief Financial Officer, the Senior
Vice President for Global Human Resources and the Senior Vice
President and General Counsel of the Company shall be permanent
members of the Committee. Members of the Committee shall serve at the
pleasure of the Board of Directors. The Board of Directors may from
time to time remove members from, or add members to, the Committee. A
majority of the members of the Committee shall constitute a quorum for
the transaction of business and the act of a majority of the members
present at any meeting at which a quorum is present shall be the act
of the Committee. Any one or more members of the Committee may
participate in a meeting by conference telephone or similar means
where all persons participating in the meeting can hear and speak to
each other, which participation shall constitute presence in person at
such meeting. Action approved in writing by a majority of the members
of the Committee then serving shall be fully

X-10.2-5

 

	 
	as effective as if the action had been taken by unanimous vote at a
meeting duly called and held. Except as may be approved by the Board
of Directors, the form of grant agreement to be used in respect of
each Stock Option granted under this Plan shall be as set forth at
Annex I (in the case of Stock Options granted on December 4, 2000) and
Annex II (in this case of Stock Options granted on September 3, 2001)
to the Plan.

	 	(b)	 	Committee Powers. The Committee shall have full power and authority to
administer the Plan in accordance with its terms. The powers of the
Committee include, but are not limited to, the power to: (i) identify
to the Board of Directors the Eligible Employees to receive Stock
Options; (ii) construe and interpret the Plan and all Stock Option
grant agreements and make any determination of fact incident to the
operation of the Plan; (iii) promulgate, amend and rescind rules and
regulations relating to the implementation, operation and
administration of the Plan; (iv) delegate to other persons the
responsibility for performing administrative or ministerial acts in
furtherance of the Plan; (v) engage the services of persons and firms
in furtherance of the Plan’s activities; and (vi) make all other
determinations and take all other actions as the Committee may deem
necessary or advisable for the administration of the Plan.
	 
	 	(c)	 	Committee’s Decisions
Final. Any determination, decision or action of
the Committee in connection with the construction, interpretation,
administration or application of the Plan, and of any Stock Option
grant agreement, shall be final, conclusive and binding upon all
Grantees, and all persons claiming through Grantees, affected thereby.

	5.	 	STOCK OPTIONS TO BE
GRANTED.

	 	 	 	 
	 	(a)	On December 4, 2000, the Company will grant Stock Options to Eligible
Employees as follows:
	 
	 		(i)	Each Eligible Employee at December 4, 2000 (as defined at Section
6(a) of the Plan) whose Average Annual Hours Worked in respect of
the three year period ended October 31, 2000 was more than 2,500
hours will be granted a Stock Option in respect of 200 shares of
Common Stock.
	 
	 		(ii)	Each Eligible Employee at December 4, 2000 (as defined at Section
6 (a) of the Plan) whose Average Annual Hours Worked in respect
of the three year period ended October 31, 2000 was 2,500 hours
or fewer, but not fewer than 1,500 hours, will be granted a Stock
Option in respect of 160 shares of Common Stock.
	 
	 		(iii)	Each Eligible Employee at December 4, 2000 (as defined at
Section 6(a) of the Plan) whose continuous service date is on or
after June 5, 2000 or whose Average Annual Hours Worked in
respect of the three year period ended October 31, 2000 was fewer
than 1,500 hours will be granted a Stock Option in respect of 120
shares of Common Stock.
	 
	 	(b)	On September 3, 2001, the Company will grant Stock Options to Eligible
Employees as follows:
	 
	 		(i)	Each Eligible Employee at September 3, 2001 (as defined at
Section 6(b) of the Plan) whose Average Hours Worked in respect
of the three year period ended August 31, 2001 was more than
2,500 hours will be granted a Stock Option in respect of 100
shares of Common Stock.

X-10.2-6

 

	 	 	 	 
	 		(ii)	Each Eligible Employee at September 3, 2001 (as defined at
Section 6(b) of the Plan) whose Average Annual Hours Worked in
respect of the three year period ending August 31, 2001 was 2,500
hours or fewer, but not fewer than 1,500 hours, will be granted a
Stock Option in respect of 80 shares of Common Stock.
	 
	 		(iii)	Each Eligible Employee at September 3, 2001 (as defined at
Section 6(b) of the Plan) whose continuous service date is on or
after March 4, 2001 or whose Average Annual Hours Worked in
respect of the three year period ending August 31, 2001 was fewer
than 1,500 hours will be granted a Stock Option in respect of 60
shares of Common Stock.

	6.	 	ELIGIBILITY REQUIREMENTS.

	 	 	 	 
	 	(a)	Each Employee of the Company or a Designated Subsidiary at December 4,
2000 who:

        	 

	 	 	 	 
	 		(i)	is a Bargaining Unit Employee; and
	 
	 		(ii)	has Seniority Status; and
	 
	 		(iii)	is an Active Employee, on Layoff or on a Leave of Absence;

	 
	shall be an “Eligible Employee” at December 4, 2000 and shall receive the
grant of a Stock Option pursuant to Section 5(a) of the Plan for that
number of shares indicated at Section 5(a) of the Plan, based on such
Eligible Employee’s Average Annual Hours Worked; provided, however, that
the Stock Option granted to any Eligible Employee shall automatically
terminate on July 5, 2001 if such Eligible Employee is not an Active
Employee (x) for a period of at least thirty (30) consecutive calendar days
during the 180-day period commencing December 5, 2000 and (y) for a period
of at least sixty (60) consecutive calendar days during the 210-day period
commencing December 5, 2000 (unless such Eligible Employee is serving as a
Local Union official during such period).

	 	(b)	 	Each Employee of the Company or a Designated Subsidiary at September
3, 2001 who:
	 

	 	(i)	 	is a Bargaining Unit Employee; and
	 
	 	(ii)	 	has Seniority Status; and
	 
	 	(iii)	 	is an Active Employee, on Layoff or on a Leave of Absence; and
	 
	 	(iv)	 	was not granted a Stock Option pursuant to Section 5(a) of the
Plan or was granted a Stock Option pursuant to Section 5(a) of
the Plan and such Stock Option was automatically terminated on
July 5, 2001 in accordance with Section 6(a) of the Plan;

	 
	shall be an “Eligible Employee” at September 3, 2001 and shall receive a
grant of a Stock Option pursuant to Section 5(b) of the Plan for that
number of shares indicated at Section 5(b) of the Plan, based on such
Eligible Employee’s Average Annual Hours worked; provided, however, that
the Stock Option granted to any Eligible Employee shall automatically
terminate on April 4, 2002 if such Eligible Employee is not an Active
Employee (x) for a period of at least thirty (30) consecutive calendar days
during the 180-day period commencing September 4, 2001 and (y) for a period
of at least sixty (60) consecutive calendar days during the 210-day period
commencing September 4, 2001 (unless such Eligible Employee is serving as a
Local Union Official during such period).

X-10.2-7

 

	7.	 	TERMS OF THE STOCK OPTIONS.
	 

	 	 	 	 
	 	(a)	Option Exercise Price. The per share exercise price of each Stock
Option granted under the Plan shall be 100% of the Fair Market Value
of a share of the Common Stock on the date of the grant of such Stock
Option.
	 
	 	(b)	Option Term. Each Stock Option granted under the Plan shall have a
term of ten years (subject to early termination in accordance with the
Plan and/or the Grant Agreement) and shall expire (unless theretofore
exercised or terminated as provided for at Section 6 or Section 8 of
the Plan or in the relevant grant agreement) on the tenth anniversary
of the date of grant of such Stock Option.
	 
	 	(c)	Conditional Vesting. Each Stock Option granted shall vest, subject to
the provisions of Section 6, Section 7(d) and Section 8 of the Plan,
in the Grantee in accordance with the following schedule:

	 	 	 	 
	 		(1)	With respect to each Stock Option granted on December 4, 2000,
when and to the extent the Stock Option becomes exercisable in
accordance with Section 7(d)(1) of the Plan, and subject to the
termination of the Stock Option pursuant to Section 6(a) of the
Plan, if the Grantee has been continuously an Employee of the
Company or a Designated Subsidiary since December 4, 2000:

 

	 	(i)	 	The Grantee shall be vested, subject to the provisions of
Sections 6(a), 7(c)(3), 7(d)(1) and 8 of the Plan, in
respect of 50% of the shares of Common Stock subject to the
option granted pursuant to such Stock Option (x) on January
4, 2001 if the Grantee is an Active Employee on January 4,
2001 and the Stock Option is not thereafter terminated in
accordance with Section 6(a) of the Plan or (y) on July 5,
2001 if the Grantee was not an Active Employee on January 4,
2001 and the Grantee has been an Active Employee for at
least sixty (60) consecutive calendar days during the
210-day period commencing December 5, 2000 (unless the
Grantee is serving as a Local Union official during such
period).

	 	(ii)	 	The Grantee shall be vested, subject to the provisions of
Sections 6(a), 7(c)(3), 7(d)(1) and 8 of the Plan and to any
prior exercises of the Stock Option, in respect of 25% of
the shares of Common Stock subject to the option granted
pursuant to such Stock Option on January 4, 2002 if the
Grantee is a Bargaining Unit Employee on January 4, 2002 and
the Grantee is vested under Section 7(c)(1)(i) of the Plan.

	 	(iii)	 	The Grantee shall be vested, subject to the provisions of
Sections 6(a), 7(c)(3), 7(d)(1) and 8 of the Plan and to any
prior exercises of the Stock Option, in respect of 25% of
the shares of Common Stock subject to the option granted
pursuant to such Stock Option on January 4, 2003 if the
Grantee is a Bargaining Unit Employee on January 4, 2003 and
the Grantee is vested under Section 7(c)(1)(i) of the Plan.

	 	 	 	 
	 		(2)	With respect to each Stock Option granted on September 3, 2001,
when and to the extent the Stock Option becomes exercisable in
accordance with Section 7(d)(2) of the Plan, and subject to the
termination of the Stock Option pursuant to Section 6(b) of the
Plan, if the Grantee has been continuously an Employee of the
Company or a Designated Subsidiary since September 3, 2001:

	 	(i)	 	The Grantee shall be vested, subject to the provisions of
Sections 6(b), 7(c)(3), 7(d)(2) and 8 of the Plan, in
respect of 50% of the shares of Common Stock subject to the
option granted pursuant to such Stock Option (x) on October
3, 2001 if the Grantee is an Active Employee on

X-10.2-8

 

	 	 	 	 
	 	 	 	October 3, 2001 and the Stock Option is not thereafter
terminated in accordance with Section 6(b) of the Plan, or
(y) on April 4, 2002 if the Grantee was not an Active
Employee on October 3, 2001 and the Grantee has been an
Active Employee for at least sixty (60) consecutive calendar
days during the 210-day period commencing September 4, 2001
(unless the Grantee is serving as a Local Union official
during such period).

	 	(ii)	 	The Grantee shall be vested, subject to the provision of
Sections 6(b), 7(c)(3), 7(d)(2) and 8 of the Plan and to any
prior exercises of the Stock Option, in respect of 50% of
the shares of Common Stock subject to the option granted
pursuant to such Stock Option (x) on October 3, 2002 if the
Grantee is a Bargaining Unit Employee on October 3, 2002 and
the Grantee is vested under Section 7(c)(2)(i) of the Plan.

	 	 	 	 
	 	 	(3)	
Upon the vesting of a Stock Option as specified in Sections
7(c)(1) and 7(c)(2) of the Plan, the Grantee of such Stock Option
shall have the right to exercise the Stock Option when and to the
extent such Stock Option becomes exercisable in accordance with
Sections 7(d)(1) and 7(d)(2), respectively, so long as the
Grantee has been continuously an Employee from the date the Stock
Option was granted through the date of the exercise of such Stock
Option. If a Grantee fails to vest in respect of any percentage
of the shares granted pursuant to Section 6 of the Plan due to a
Grantee’s failure to satisfy any of the vesting requirements of
Section 7(c)(1) or 7(c)(2) of the Plan, as the case may be, then
the Stock Option shall terminate with respect to the shares of
Common Stock subject to such Stock Option in respect of which the
vesting requirements were not satisfied; provided that, if a
Grantee shall fail to satisfy the vesting conditions specified in
Section 7(c)(1)(i) or Section 7(c)(2)(i) of the Plan, as
applicable, the Stock Option of Grantee shall automatically
terminate in its entirety on July 5, 2001 or April 4, 2002,
respectively.

	 	 	 	 
	 	(d)	Exercisability. If the Grantee of a Stock Option has been continuously
an Employee from and after the date the Stock Option was granted and
(x) if the Stock Option was not automatically terminated in accordance
with Section 6(a) or Section 6(b) of the Plan, as the case may be, and
(y) if and to the extent such Stock Option shall have vested in
accordance with Section 7(c) of the Plan, the Grantee of such Stock
Option shall be entitled to exercise, subject to the limitations set
forth at Sections 6, 7(b), 7(c)(3) and 8 of the Plan, such Stock
Option in accordance with the following schedule:

	 	 	 	 
	 	 	(1)	With resect to each Stock Option granted on December 4, 2000:

	 	 	 	 
	 	(i)	 	On and after December 4, 2001, such Stock Option will be
exercisable to the extent of the 50% of the shares of Common
Stock subject to the option granted pursuant to such Stock
Option that vest in accordance with Section 7(c)(1)(i) of
the Plan.
	
	
	
	

	 	(ii)	 	On and after December 4, 2002, such Stock Option will be
exercisable to the extent of the 25% of the shares of Common
Stock subject to the option granted pursuant to such Stock
Option that vest in accordance with Section 7(c)(1)(ii) of
the Plan.
	
	
	
	

	 	(iii)	 	On and after December 4, 2003, such Stock Option will be
exercisable to the extent of the 25% of the shares of Common
Stock subject to the option granted pursuant to such Stock
Option that vest in accordance with Section 7(c)(1)(iii) of
the Plan.

	 	 	 	 
	 		(2)	With respect to each Stock Option granted on September 3, 2001:

X-10.2-9

 

	 	(i)	 	On and after September 3, 2002, such Stock Option will be
exercisable to the extent of the 50% of the shares of Common
Stock subject to the option granted pursuant to such Stock
Option that vest in accordance with Section 7(c)(2)(i) of
the Plan.
	
	
	
	

	 	(ii)	 	On and after September 3, 2003, such Stock Option will be
exercisable to the extent of the 50% of the shares of Common
Stock subject to the option granted pursuant to such Stock
Option that vest in accordance with Section 7(c)(2)(ii) of
the Plan.

	 	(e)	 	Conditions to Exercise. At the time of each exercise of a Stock
Option: (i) the Grantee shall have been continuously an Employee from
the date such Stock Option was granted through the earlier of (A) date
of the exercise of such Stock Option, (B) the date of the Grantee’s
Retirement, or (C) the date of the Grantee’s death; (ii) the vesting
requirements of Sections 7(c) of the Plan applicable to such Stock
Option shall have been satisfied in respect of the shares of Common
Stock then being purchased pursuant to the exercise of such Stock
Option; and (iii) the Stock Option shall be exercisable as provided at
Section 7(d)(1) of the Plan or Section 7(d)(2) of the Plan, as
applicable, in respect of the shares of Common Stock then being
purchased pursuant to the exercise of such Stock Option. If any shares
of Common Stock subject to a Stock Option granted to a Grantee do not
vest in the Grantee at the time or times provided in the applicable
subsection of Section 7(c), then the Grantee shall not be entitled to
exercise the Stock Option at any time in respect of the shares of
Common Stock that did not vest in accordance with such applicable
subsection of Section 7(c) of the Plan.

	8.	 	EXERCISE FOLLOWING EMPLOYMENT.

	 	(a)	 	Retirement. If a Grantee has been continuously an Employee from the
date his or her Stock Option was granted through the date of his or
her Retirement, then following Retirement such Grantee may exercise
his or her Stock Option at any time during the remainder of the term
of the Stock Option with respect to that number of shares of Common
Stock that were vested under Section 7(c) of the Plan at the date of
the Grantee’s Retirement.
	 
	 	(b)	 	Death. If a Grantee has been continuously an Employee from the date
his or her Stock Option was granted through the earlier of the date of
his or her Retirement or the date of his or her death, then in the
event of the death of the Grantee, the legal representative of Grantee
may exercise such Stock Option with respect to that number of shares
of Common Stock that were vested under Section 7(c) of the Plan at the
date of Grantee’s death (or, if earlier, the date of the Grantee’s
Retirement) at any time up to three years after the Grantee’s date of
death, but in no event more than ten years after the date the Stock
Option was granted.
	 
	 	(c)	 	Other Termination of Employment. Except as provided in Subsections (a)
and (b) of this Section 8, no Stock Option shall be exercisable after
the Grantee ceases to be an Employee.

	9.	 	METHOD OF EXERCISE. A Stock Option may be exercised, in whole or in part,
by the Grantee (or his or her legal representative, if permitted by the
Plan) giving written notice of exercise to the Company (or to an agent of
the Company designated in writing to the Grantee), specifying the number of
shares of Common Stock to be purchased. Such notice shall be accompanied by
payment in full of the purchase price, plus any required withholding taxes,
or by documents necessary to effect the simultaneous exercise of the Stock
Option and the sale of the shares of Common Stock thereby acquired pursuant
to a brokerage or similar arrangement approved in advance by

X-10.2-10

 

	 	 	 
	 	 	the Committee and authorizing the use of the proceeds from such sale to pay
to the Company the exercise price and withholding taxes.

	10.	 	NON-TRANSFERABILITY OF STOCK OPTIONS. No Stock Option granted, and no right
or interest therein, shall be (i) assignable, alienable or transferable by
a Grantee, except by will or the laws of descent and distribution, or (ii)
subject to any obligation, or the lien or claims of any creditor, of a
Grantee, or (iii) subject to any lien, encumbrance or claim of any party
made in respect of or through any Grantee, however arising. During the
lifetime of a Grantee, the Stock Option shall be exercisable only by, and
shares of Common Stock issued upon the exercise of Stock Option will be
issued only to, the Grantee or his or her legal representative.
	 
	11.	 	AMENDMENT AND TERMINATION. The Board of Directors may at any time and from
time to time amend the Plan. The Board of Directors may at any time
terminate the Plan; provided, however, that no termination of the Plan
shall affect Stock Options outstanding on the date of such termination.
	 
	12.	 	MISCELLANEOUS.

	 	(a)	 	Withholding Taxes. All Stock Options granted under the Plan are made
subject to any and all applicable withholding for taxes of any kind.
The Company shall have the right to deduct from any delivery of shares
of Common Stock to be made under the Plan, all federal, state, city,
local or foreign taxes of any kind required by law to be withheld with
respect to such payment and to take such other actions as may be
necessary in the opinion of the Company to satisfy all obligations for
the payment of such taxes. The Company shall have the right to require
a Grantee to pay cash to satisfy withholding taxes as a condition to
the issuance of any shares of Common Stock under the Plan.
	 
	 	(b)	 	No Right to Employment. Neither the adoption of the Plan nor the grant
of any Stock Option shall confer upon any Grantee, any Employee or any
other person any right to continued employment with the Company or any
subsidiary of the Company, nor shall it interfere in any way with the
right of the Company or any subsidiary of the Company to terminate the
employment of any Grantee, any Employee or any other person at any
time, with or without cause.
	 
	 	(c)	 	Unfunded Plan. The Plan shall be unfunded. Any liability of the
Company to any person with respect to any Stock Option granted under
the Plan shall be based solely upon any contractual obligation that
may be effected pursuant to the Plan. No such obligation of the
Company shall be deemed to be secured by any pledge of, or other
encumbrance on, any property of the Company or any of its
subsidiaries.
	 
	 	(d)	 	Other Company Benefit and Compensation Programs. Any benefits received
by a Grantee under the Plan shall not be deemed a part of such
Grantee’s regular, recurring compensation and shall not be included
in, nor have any effect on, the determination of benefits under any
pension or other employee benefit plan or similar arrangement provided
by the Company or any of its subsidiaries. Payments and benefits
provided to any Employee under any other plan or agreement shall be
governed solely by the terms of such other plan or agreement.
	 
	 	(e)	 	Securities Law Restrictions. In no event shall the Company be
obligated to issue or deliver any shares of Common Stock if such
issuance or delivery shall constitute a violation of any provision of
any law or regulation of any government, any governmental agency or
authority, or any securities exchange. No shares of Common Stock shall
be issued under the Plan unless counsel for the Company shall be
satisfied that such issuance will be in compliance with all applicable
Federal and state

X-10.2-11

 

	 	 	 	 
	 	 	 	securities laws and regulations and all requirements of any securities
exchange on which shares of the Common Stock are listed.

	 	 	 	 
	 		(f)	Grant Agreements. Each Eligible Employee receiving a Stock Option
under the Plan shall enter into a grant agreement with the Company in
the form, appropriately competed, of Annex I or Annex II, as
applicable, or in such other form of grant agreement as shall be
approved by the Board of Directors.
	 
	 		(g)	Severability. In the event any provision of the Plan shall be held to
be invalid or unenforceable for any reason, such invalidity or
unenforceability shall not affect the remaining provisions of the
Plan.
	 
	 		(h)	Governing Law. The Plan shall be governed by and construed in
accordance with the laws of the State of Ohio.

     [ANNEX I AND ANNEX II ARE INTENTIONALLY OMITTED FROM THIS COPY OF THE PLAN]

X-10.2-12EX-10.3  Deferred Compensation Plan for Executives

 

EXHIBIT 10.3

 

 

 

 

THE GOODYEAR TIRE & RUBBER COMPANY

DEFERRED COMPENSATION PLAN FOR EXECUTIVES

(Amended and Restated as of January 1, 2002)

 

 

X-10.3-1

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	 	 	Page
	 	 	 	 	
	ARTICLE I — GENERAL
	
	
	
	

	Section 1.1	 	
Purpose
	 	1
	
	
	
	

	Section 1.2	 	
Intent
	 	1
	
	
	
	

	Section 1.3	 	
Effective Date
	 	1
	
	
	
	

	Section 1.4	 	
Contractual Obligation of Employer
	 	2
	 
	
ARTICLE II
	
	
	
	

	
DEFINITIONS AND USAGE
	
	
	
	

	Section 2.1	 	
Definitions
	 	2
	
	
	
	

	Section 2.2	 	
Usage
	 	10
	 
	
ARTICLE III
	
	
	
	

	ELIGIBILITY
	
	
	
	

	Section 3.1	 	
Eligibility to Defer Performance Compensation
	 	10
	
	
	
	

	Section 3.2	 	
Eligibility to Defer Salary
	 	11
	 
	
ARTICLE IV
	
	
	
	

	
COMPENSATION ELIGIBLE FOR DEFERRAL; NOTICE AND
PARTICIPATION
	
	
	
	

	Section 4.1	 	
Performance Compensation
	 	11
	
	
	
	

	Section 4.2	 	
Deferrable Salary
	 	12
	
	
	
	

	Section 4.3	 	
Participation; Notice and Agreement Procedure
	 	12
	
	
	
	

	Section 4.4	 	
Time for Filing Elections
	 	13
	 
	ARTICLE V
	
	
	
	

	MANDATORY DEFERRALS
	
	
	
	

	Section 5.1	 	
Designated Participants Subject to Mandatory
Deferrals
	 	13
	
	
	
	

	Section 5.2	 	
Period of Deferral
	 	14
	
	
	
	

	Section 5.3	 	
Election of Deferral Period
	 	14
	 
	
ARTICLE VI
	
	
	
	

	
ACCOUNTS AND REFERENCE INVESTMENT ELECTIONS
	
	
	
	

	Section 6.1	 	
Deferred Compensation
	 	14
	
	
	
	

	Section 6.2	 	
Accounts
	 	15
	
	
	
	

	Section 6.3	 	
Reference Investment Procedure
	 	15
	
	
	
	

	Section 6.4	 	
Equivalents; Reference Investment Elections
	 	16
	
	
	
	

	Section 6.5	 	
Failure to Elect Reference Investment
	 	18
	
	
	
	

	Section 6.6	 	
Adjustments to Account Balances
	 	18
	
	
	
	

	Section 6.7	 	
No Responsibility for Results of Reference
Investment Funds
	 	19

X-10.3-2

 

	 	 	 	 	 
	ARTICLE VII
	
	
	
	

	PAYMENT OF DEFERRED COMPENSATION
	
	
	
	

	Section 7.1	 	Distribution Events	 	9
	
	
	
	

	Section 7.2	 	Absence of Deferral Period Election	 	21
	
	
	
	

	Section 7.3	 	Minimum Balance	 	21
	 
	
ARTICLE VIII
	
	
	
	

	
PAYMENTS FROM THE PLAN
	
	
	
	

	Section 8.1	 	
Timing, Amount and Form of Payment
	 	22
	
	
	
	

	Section 8.2	 	
Acceleration of Payment Upon Change of Control
	 	23
	 
	
ARTICLE IX
	
	
	
	

	
SOURCE OF PAYMENTS
	
	
	
	

	Section 9.1	 	
Payments from General Funds of Employers and
Rabbi Trusts
	 	23
	
	
	
	

	Section 9.2	 	
The Trusts
	 	24
	
	
	
	

	Section 9.3	 	
Contributions and Expenses
	 	24
	
	
	
	

	Section 9.4	 	
Trustee Duties
	 	24
	
	
	
	

	Section 9.5	 	
Reversion of Trust Funds to Company or
Participating Employer
	 	24
	 
	
ARTICLE X
	
	
	
	

	
DESIGNATION OF BENEFICIARIES
	
	
	
	

	Section 10.1	 	
Designation Procedure
	 	25
	
	
	
	

	Section 10.2	 	
Payment to the Participant’s Representative
	 	26
	
	
	
	

	Section 10.3	 	
Unclaimed Benefits
	 	26
	 
	
ARTICLE XI
	
	
	
	

	
ADMINISTRATION OF PLAN
	
	
	
	

	Section 11.1	 	
Administration
	 	27
	
	
	
	

	Section 11.2	 	
Allocation of Fiduciary Responsibilities;
Composition and Powers of Committee
	 	27
	
	
	
	

	Section 11.3	 	
Indemnification
	 	29
	
	
	
	

	Section 11.4	 	
Claims Procedures
	 	29
	 
	
ARTICLE XII
	
	
	
	

	
AMENDMENT AND TERMINATION
	
	
	
	

	Section 12.1	 	
Amendment of the Plan
	 	30
	
	
	
	

	Section 12.2	 	
Termination of the Plan
	 	30

X-10.3-3

 

	 	 	 	 	 
	
ARTICLE  XIII
	
	
	
	

	
MISCELLANEOUS PROVISIONS
	Section 13.1	 	
No Assignment
	 	 	31	 
	
	
	
	

	Section 13.2	 	
Adoption of and Withdrawal from Plan by a
Participating Employer
	 	 	31	 
	
	
	
	

	Section 13.3	 	
Information Required
	 	 	31	 
	
	
	
	

	Section 13.4	 	
Elections by Eligible Employees
	 	 	31	 
	
	
	
	

	Section 13.5	 	
Notices by Committee or any Employer
	 	 	32	 
	
	
	
	

	Section 13.6	 	
No Employment Contract or Commitment
	 	 	32	 
	
	
	
	

	Section 13.7	 	
Severability
	 	 	32	 
	
	
	
	

	Section 13.8	 	
Effect of IRS Determination
	 	 	32	 
	
	
	
	

	Section 13.9	 	
Taxes and Withholding
	 	 	32	 
	
	
	
	

	Section 13.10	 	
No Rights to Assets Created
	 	 	32	 
	
	
	
	

	Section 13.11	 	
Precedent
	 	 	33	 
	
	
	
	

	Section 13.12	 	
No Guarantees
	 	 	33	 
	
	
	
	

	Section 13.13	 	
Expenses
	 	 	33	 
	
	
	
	

	Section 13.14	 	
Claims of Other Person
	 	 	33	 
	
	
	
	

	Section 13.15	 	
Captions
	 	 	33	 
	
	
	
	

	Section 13.16	 	
Choice of Law
	 	 	33	 
	
	
	
	

	Section 13.17	 	
Binding Agreement
	 	 	34	 

X-10.3-4

 

THE GOODYEAR TIRE & RUBBER COMPANY

DEFERRED COMPENSATION PLAN FOR EXECUTIVES

     THE GOODYEAR TIRE & RUBBER COMPANY, an Ohio corporation (“Goodyear” or the
“Company”) hereby amends and restates the Deferred Compensation Plan for
Executives of the

     Company (the “Plan”) as hereinafter provided.

ARTICLE I

GENERAL

     Section 1.1 Purpose. The purpose of the Plan is to promote the greater
success of Goodyear and its participating wholly-owned subsidiaries by
providing a means for a select group of management and highly compensated
employees of Goodyear and such subsidiaries (whose positions enable them to
make significant contributions to the profitability, competitiveness and growth
of the Company and its subsidiaries) to defer certain incentive and salary
compensation. In addition, compensation of executive officers of the Company
which for any reason would not be deductible by the Company for Federal Income
Tax purposes due to the limitations on deductibility set forth in Section
162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), shall be
automatically deferred for future payment under the Plan when such payments
will be deductible by the Company.

     Section 1.2. Intent. The Plan is intended to be an unfunded, non-qualified
plan primarily for the purpose of providing the opportunity to officers and a
select group of management and highly compensated employees of the Company and
participating wholly-owned subsidiaries of the Company, as described under
Sections 201(2), 301(a)(3), and 401(a)(l) of ERISA, to defer certain
compensation. The Plan is not intended to be a plan described in Section 401(a)
of the Code.

     Section 1.3. Effective Date. The provisions of the Plan shall be effective
as of January 1, 2002, the date for which changes to the Plan were approved
by the Compensation Committee of the Goodyear Board of Directors and adopted by
the Goodyear Board of Directors. The rights, if any, of any Participant (as
hereinafter defined) in the Plan whose status as an employee of the Company or
any Participating Employer (as hereinafter defined) terminates for any reason
shall be determined pursuant to the Plan as in effect on the date such
Participant ceases to be an employee of the Company or any Participating
Employer, unless a subsequently adopted provision of the Plan states otherwise.

     Section 1.4. Contractual Obligation of Employer. The obligation of the
Company and Participating Employers to make payments of Deferred Compensation
(as hereinafter defined) and Mandatory Deferred Compensation (as hereinafter
defined) in accordance with the Plan are contractual, general unsecured
obligations and liabilities of the Company and, as applicable, Participating
Employers to pay for services in accordance with the terms of the Plan. It is
intended that payments of Deferred Compensation and Mandatory Deferred
Compensation under the Plan shall be paid from one or more Trusts (as
hereinafter defined) established for that purpose. If, and to the extent that,
the assets of such Trusts are not sufficient to make all payments of Deferred
Compensation and Mandatory Deferred Compensation required by the terms of the
Plan, such shortfall shall be paid by the Company and, as applicable, the
Participating Employers. All Deferred Performance Amounts (as hereinafter
defined), Deferred Salary Amounts (as hereinafter defined) and Mandatory
Deferred Amounts (as hereinafter defined) will be recorded in Accounts (as
hereinafter defined) and, ordinarily, amounts equivalent thereto will be
transferred by the Company and, as applicable, the Participating Employers to
their respective Trusts. Each Participant may elect, from alternatives
available under the Plan, to have Deferred Performance Amounts, Deferred Salary
Amounts and Mandatory Deferred Amounts, if any, adjusted by amounts equivalent
to the amounts such Deferred Amounts and Mandatory Deferred Amounts, if any,
would realize (as earnings, gains and losses, net of expens-

X-10.3-5

 

es and taxes) if
invested (for the relevant period) in one or more of the mutual funds or other
investment vehicles or reference rates designated from time to time as the
Reference Investment Funds (as hereinafter defined) available under the Plan.
No Participant or Beneficiary (as hereinafter defined) shall have any right,
title or interest whatever in or to any investment reserves, accounts, trusts
or other funds or assets that the Company or the Participating Employers may
purchase, establish, or accumulate to aid in paying Deferred Compensation and
Mandatory Deferred Compensation as and when due to the Participants under the
Plan. Nothing contained in the Plan, and no action taken pursuant to its
provisions, shall create or be construed to create a trust or a fiduciary
relationship of any kind between the Company (or a Participating Employer) and
a Participant, his or her Beneficiaries or any other person. Neither a
Participant nor his or her Beneficiaries shall acquire any right or interest
under the Plan other or greater than that of an unsecured creditor.

ARTICLE II

DEFINITIONS AND USAGE

     Section 2.1. Definitions. Wherever used in the Plan, the following words
and phrases shall have the meaning set forth below, unless the context plainly
requires a different meaning:

		
	 
	 	     “Account” means the following “Accounts” to be maintained by the Committee
for each Participant for recordkeeping, measurement and accounting purposes;
provided, that any Plan assets will not be segregated among such “Accounts” and
each Participant will have only an unsecured contractual claim against his or
her Employer for the amount of his or her “Account” balances:

     (a)  Performance Plan Account. An Account to record the amount of a
Participant’s Performance Compensation deferred pursuant to the provisions of
Article IV of the Plan in respect of a Plan Year, as from time to time adjusted
to reflect any and all Equivalents attributable to such Deferred Performance
Amount.

     (b)  Annual Salary Account. An Account to record the aggregate amount of a
Participant’s Salary deferred pursuant to the provisions of Article IV of the
Plan in respect of a Plan Year, as from time to time adjusted to reflect any
and all Equivalents attributable to such Deferred Salary Amount.

     (c)  Mandatory Deferred Account. An Account to record the amount of all of
a Participant’s Performance Compensation, Salary and other cash compensation in
respect of a Plan Year deferred pursuant to the provisions of Article V of the
Plan, as from time to time adjusted to reflect any and all Equivalents
attributable to such Mandatory Deferred Amount.

		
	 	     “Acquiring Person” means any person (any individual, firm, corporation or
other entity) who or which, together with all Affiliates and Associates, shall
be or become the beneficial owner of shares of the Common Stock of the Company.
	 
	 	     “Affiliate” and “Associate” shall have the respective meanings ascribed to
such terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended.
	 
	 	     “Aggregate Deferred Amount” means, with respect to any Participant, the
sum of all Deferred Amounts with respect to such Participant during all Plan
Years to the date (or Valuation Date) on or as of which any determination of
the amount thereof is being or to be made.
	 
	 	     “Aggregate Mandatory Amount” means, with respect to any Participant, the
sum of all Mandatory Deferred Amounts with respect to such Participant during
all Plan Years to the date (or Valuation Date) on or as of which any
determination of the amount thereof is being or to be made.

X-10.3-6

 

		
	 	     “Agreement” and "Notice and Agreement” means an instrument executed and
delivered in accordance with Section 4.3 of the Plan, whereunder an Eligible
Employee elects and agrees with his or her Employer to (i) participate in the
Plan in respect of a Plan Year by deferring Performance Compensation or
Deferrable Salary, as the case may be, in accordance with Article IV of the
Plan (a Participant must enter into a separate Agreement in respect of the
deferral of Performance Compensation and a separate Agreement in respect of the
deferral of Salary each Plan Year in order to defer Performance Compensation
and Salary), (ii) defer all or a specific amount or percentage of his or her
Performance Compensation or Deferrable Salary, and (iii) comply with and be
bound by all the terms and conditions of the Plan.
	 
	 	     “Annual Salary Rate” means, with respect to each Plan Year: (i) if the
Salary Measurement Date is January 1 of such Plan Year, the Salary payable to
an Employee during or in respect of January of the Plan Year multiplied by
twelve (12), or, (II) if the Salary Measurement Date is December 1 of the year
preceding such Plan Year, the Salary payable to an Employee during or in
respect of the month of December of the year preceding such Plan Year
multiplied by twelve (12), or (iii) if the Salary Measurement Date is an
Employment Date, the Salary payable to an Employee during or in respect of such
person’s first full month of Employment multiplied by the number of full months
remaining in such Plan Year subsequent to the Employment Date.
	 
	 	     “Beneficiary” means any person or entity (including a trust or the estate
of a Participant) designated in a written instrument executed by a Participant
and delivered to the Committee in accordance with the provisions of Section
10.1 of the Plan.
	 
	 	     “Board” means the Board of Directors of Goodyear.
	 
	 	     “Change of Control” shall mean, and shall be deemed to have occurred when
(the “Change of Control Date”), any Acquiring Person (other than the Company,
any subsidiary of the Company, any employee benefit plan of the Company or of
any subsidiary of the Company, or any person or entity organized, appointed or
established by the Company or any subsidiary of the Company for or pursuant to
the terms of any such plans), alone or together with its Affiliates and
Associates, shall become the beneficial owner of thirty-five percent (35%) or
more of the shares of the Common Stock of the Company, without par value (the
“Common Stock”) then outstanding (except pursuant to an offer for all
outstanding shares of the Common Stock at a price and upon such terms and
conditions as a majority of the Continuing Directors determine to be in the
best interests of the Company and its shareholders (other than the Acquiring
Person or any Affiliate or Associate thereof on whose behalf the offer is being
made)), and the Continuing Directors no longer constitute a majority of the
Board.
	 
	 	     “Code” means the Internal Revenue Code of 1986, as amended from time to
time, and regulations and rulings promulgated thereunder.
	 
	 	     “Committee” means the Committee established under, and operating pursuant
to the provisions of, Article XI of the Plan.
	 
	 	     “Company” means The Goodyear Tire & Rubber Company, its successors and any
corporation into which it may be merged or consolidated.
	 
	 	     “Compensation Committee” means the Compensation Committee of the Board.
	 
	 	     “Continuing Director” means any individual who is a member of the Board,
while such individual is a member of the Board, who is not an Acquiring Person,
or an Affiliate or Associate of an Acquiring Person, or a representative or
nominee of an Acquiring Person or of any such Affiliate or Associate and was a
member of the Board prior to the occurrence of the Change of Control Date, any
successor of a Continuing Director, while

X-10.3-7

 

		
	 	such successor is a member of the
Board, and who is not an Acquiring Person, or an Affiliate or Associate of an
Acquiring Person, or representative or nominee of an Acquiring Person or of any
such Affiliate or Associate, and is recommended or elected to succeed the
Continuing Director by a majority of the Continuing Directors.
	 
	 	     “Deferrable Salary” means, with respect to each Eligible Employee and with
respect to each Plan Year, such Eligible Employee’s Salary for such Plan
Year. .
	 
	 	     “Deferred Amount” means, with respect to any Participant and any Plan
Year, the sum of the Deferred Performance Amount and the Deferred Salary Amount
of such Participant during such Plan Year.
	 
	 	     “Deferred Compensation” means, with respect to any Participant, the
aggregate of all Deferred Performance Compensation and Deferred Salary of such
Participant for all Plan Years to the date (or Valuation Date) on or as of
which any determination of the amount thereof is being or to be made.
	 
	 	     “Deferred Performance Amount” means, with respect to any Participant and
any Plan Year, the amount of Performance Compensation deferred by such
Participant during such Plan Year pursuant to Article IV of the Plan.
	 
	 	     “Deferred Performance Compensation” means, with respect to any Participant
and any Plan Year, the sum of the Deferred Performance Amount in respect of
such Plan Year and all Equivalents attributable to, and credited (or charged)
to the Performance Plan Account in respect of, such Deferred Performance Amount
to the date (or Valuation Date) on or as of which any determination of the
amount thereof is being or to be made.
	 
	 	     “Deferred Salary” means, with respect to any Participant and any Plan
Year, the sum of the Deferred Salary Amount in respect of such Plan Year and
all Equivalents attributable to, and credited (or charged) to the Annual Salary
Account in respect of, such Deferred Salary Amount to the date (or Valuation
Date) on or as of which any determination of the amount thereof is being or to
be made.
	 
	 	     “Deferred Salary Amount” means, with respect to any Participant and any
Plan Year, the amount of Salary deferred by such Participant during such Plan
Year pursuant to Article IV of the Plan.
	 
	 	     “Disability” or “Disabled” means a physical or mental condition of a
Participant resulting from a bodily injury, disease, or mental disorder which
renders the Participant incapable of continuing in the Employment of any
Employer or other Affiliate of the Company and results in such Participant
receiving or being entitled to receive benefits under the Company’s Long Term
Disability Income Plan or the Retirement Plan (or, if such Participant is then
an Employee of a Participating Employer, under similar plans, if any, of such
Participating Employer).
	 
	 	     “Eligible Employee” means any Employee of an Employer who, at the time the
determination thereof is being or to be made, (i) is employed within the United
States of America, (ii) is a citizen of or resident in the United States of
America, (iii) is a participant in the Performance Plan for the then current
Plan Year, (iv) has an Annual Salary Rate of at least $170,000 per year, and
(v) is designated by the Committee as being eligible to participate in the Plan
for the Plan Year.
	 
	 	     “Employee” means any person who is a full-time salaried employee of an
Employer.
	 
	 	     “Employer” means and includes, as of the time at which a determination
thereof is being or to be made, the Company or any Participating Employer, or
their respective successors and assigns that adopt the Plan.

X-10.3-8

 

		
	 	     “Employment” means the fact that and the period during which an Employee
is regularly employed by an Employer.
	 
	 	     “Employment Date” means the date on which an Employee first earned
compensation from an Employer.
	 
	 	     “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and regulations and rulings promulgated thereunder.
	 
	 	     “Executive Officer” means and includes the Chairman of the Board and Chief
Executive Officer, any Vice Chairman of the Board, the President, any Vice
President, the Treasurer, the Comptroller or the Secretary of the Company (or
such other person as the General Counsel of the Company may designate).
	 
	 	     “Equivalent” means, as at any time as of which any determination thereof
is being or to be made, the net amount (of the earnings, gains, losses,
expenses and taxes in respect of applicable Reference Investment Funds)
attributed to any Deferred Performance Amount, Deferred Salary Amount or
Mandatory Deferred Amount, and credited (or charged) to the related Account, in
accordance with the provisions of Article VI of the Plan.
	 
	 	     “Mandatory Deferred Amount” means, with respect to any Participant and any
Plan Year, the sum of the Mandatory Deferred Performance Amount, the Mandatory
Deferred Salary Amount and the Mandatory Deferred OC Amount of such Participant
in respect of such Plan Year.
	 
	 	     “Mandatory Deferred Compensation” means, with respect to any Participant,
the aggregate of all Mandatory Deferred Performance Compensation, all Mandatory
Deferred Salary and all Mandatory Deferred Other Compensation of such
Participant for all Plan Years to the date (or Valuation Date) on or as of
which any determination of the amount thereof is being or to be made.
	 
	 	     “Mandatory Deferred OC Amount” means, with respect to any Participant and
any Plan Year, the amount of cash compensation (other than Performance
Compensation or Salary) automatically deferred in respect of such Participant
during such Plan Year pursuant to Article V of the Plan.
	 
	 	     “Mandatory Deferred Other Compensation means, with respect to any
Participant and any Plan Year, the sum of the Mandatory Deferred OC Amount in
respect of such Plan Year and any and all Equivalents attributable to, and
credited (or charged) to the Mandatory Deferred Account in respect of, such
Mandatory Deferred OC Amount to the date (or Valuation Date) on or as of which
any determination of the amount thereof is being or to be made.
	 
	 	     “Mandatory Deferred Performance Amount” means, with respect to any
Participant and any Plan Year, the amount of Performance Compensation
automatically deferred in respect of such Participant during such Plan Year
pursuant to Article V of the Plan.
	 
	 	     “Mandatory Deferred Performance Compensation” means, with respect to any
Participant and any Plan Year, the sum of the Mandatory Deferred Performance
Amount of such Participant in respect of such Plan Year and all Equivalents
attributable to, and credited (or charged) to the Mandatory Deferred Account in
respect of, such Mandatory Deferred Performance Amount to the date (or
Valuation Date) on or as of which any determination thereof is being or to be
made.
	 
	 	     “Mandatory Deferred Salary” means, with respect to any Participant and any
Plan Year, the sum of the Mandatory Deferred Salary Amount of such Participant
in

X-10.3-9

 

		
	 	respect of such Plan Year and all Equivalents attributable to, and credited
(or charged) to the Mandatory Deferred Account in respect of, such Mandatory
Deferred Salary Amount to the date (or Valuation Date) on or as of which any
determination thereof is being or to be made.
	 
	 	     “Mandatory Deferred Salary Amount” means, with respect to any Participant
and any Plan Year, the amount of Salary automatically deferred in respect of
such Participant during such Plan Year pursuant to Article V of the Plan.
	 
	 	     “Net Performance Compensation” means the amount of compensation after
withholding for taxes and other deductions that would apply to Deferred
Compensation.
	 
	 	     “Participant” means any, and includes each, (i) Eligible Employee
participating or a former Eligible Employee who continues to have deferrals
because of participation in the Plan in accordance with Articles III and IV of
the Plan, and (ii) any Executive Officer whose Performance Compensation, Salary
or other cash compensation, or any portion or portions thereof, in respect of
any Plan Year have been or are being automatically deferred in accordance with
Article V of the Plan.
	 
	 	     “Participating Employer” means each subsidiary of the Company which is
directly or indirectly wholly-owned by the Company and is organized and
existing under the laws of the United States of America or any state thereof
that adopts the Plan by action of its board of directors and enters into a
Trust Agreement.
	 
	 	     “Performance Plan” means the Goodyear Performance Recognition Plan for any
Performance Plan Year (payouts, if any, in respect of which would be made of
the year following the Performance Plan Year for such Performance Recognition
Plan), as approved by the Compensation Committee, or any plan designated by the
Compensation Committee as the successor to any such plan.
	 
	 	     “Performance Plan Year” means the period commencing January 1 and ending
on December 31 in respect of which there is a Performance Plan in effect, where
the payout, if any, thereunder will be made in February of the following year.
	 
	 	     “Performance Compensation” means any amount earned by and payable to an
Eligible Employee under the Performance Plan in respect of any Plan Year
thereof.
	 
	 	     “Plan Year” means each period of one year beginning January 1 and ending
December 31.
	 
	 	     “Recordkeeper” means that person or entity selected from time to time by
the Committee to establish and maintain Accounts and other records and to
perform related services in respect of the Plan and the Trusts.
	 
	 	     “Reference Investment Funds” means those mutual funds, bank common trust
funds, insurance contracts and other investment vehicles and reference rates
which, in accordance with the provisions of Article VII of the Plan, are used
as the reference for the determination and measurement of Equivalents to be
attributed to the Deferred Amounts and Mandatory Deferred Amounts, if any, of
Participants, as from time to time selected by the Compensation Committee
pursuant to the provisions of Article VII of the Plan and identified at Annex I
to the Plan.
	 
	 	     “Retirement” means, with respect to any Participant, the termination of
employment with the Company (or other Participating Employer) after either 30
years of service or 10 years of service and the attainment of age 55 or
attainment of age 65.
	 
	 	     “Retirement Plan” means the Company’s Salaried Pension Plan, as amended
and in effect from time to time.

X-10.3-10

 

		
	 	     “Salary” means the amount of base salary (as determined before any
contributions to the Savings Plan (or any similar plan of any Participating
Employer) and before any withholding for taxes, payroll taxes or charges and
deductions for benefits provided by the Company or any other Employer) paid or
payable to an Employee during the period in respect of which a determination
with respect to such base salary is being or to be made.
	 
	 	     “Salary Measurement Date” shall mean, with respect to each Plan Year: (i)
with respect to each person who is an Employee on the first day of such Plan
Year, (a) if used in determining whether an Employee is an Eligible Employee
for the purpose of deferring Performance Compensation during such Plan Year,
January 1 of such Plan Year, and (b) if used in determining whether an Employee
is an Eligible Employee for the purpose of deferring Salary during such Plan
Year, December 1 of the year preceding such Plan Year; and (ii) in respect of
each person who becomes an Employee during such Plan Year, the Employment Date
of such Employee.
	 
	 	     “Savings Plan” means the Employee Savings Plan for Salaried Employees of
the Company, as amended and in effect from time to time.
	 
	 	     “Subsidiary” means any corporation, joint venture or other entity of which
(or in which) more than 50% of the outstanding capital stock, or interest in
the profits, is owned by the Company and one or more other Subsidiaries, or by
one or more other Subsidiaries.
	 
	 	     “Trust” or “Trust Fund” means each of (i) the “Rabbi Trust” to be
established under a Trust Agreement to be entered into by the Company to
receive and invest amounts transferred to it by the Company for future payment
as Deferred Compensation and Mandatory Deferred Compensation under the Plan,
which trust’s assets will be subject to the claims of general creditors of the
Company, and (ii) each “Rabbi Trust” established under a Trust Agreement
entered into by a Participating Employer to receive and invest amounts
transferred to such “Rabbi Trust” by such Participating Employer for future
payment as Deferred Compensation under the Plan, which trust’s assets will be
subject to the claims of general creditors of the Participating Employer
establishing such “Rabbi Trust”; and “Trusts” and “Trust Funds” means all such
Trusts and Trust Funds.
	 
	 	     “Trust Agreement” means each of (i) a Rabbi Trust Agreement between the
Company and the Trustee to provide for the Trust to be established by the
Company, and (ii) a similar agreement between a Participating Employer and such
Trustee; and “Trust Agreements” means all such Trust Agreements.
	 
	 	     “Trustee” means the individual(s), corporation(s) or other entity(ies)
appointed by the Company and each of the Participating Employers, pursuant to
the Trust Agreements, to hold and manage the Trust Funds as “Rabbi Trusts”.
	 
	 	     “Valuation Date” means the close of each business day during each Plan
Year, of which the Trustee will determine the fair market value of the Trust
Fund and the Recordkeeper will determine the amount (balance) of each Account.
	 
	 	     Section 2.2. Usage. Except where otherwise indicated by the context, any
masculine terminology used herein shall also include the feminine and vice
versa, and the definition of any term herein in the singular shall also include
the plural and vice versa.

X-10.3-11

 

ARTICLE III

ELIGIBILITY

     Section 3.1. Eligibility to Defer Performance Compensation.

     (b)  Any eligible Employee may elect to defer all or certain portions of
his or her Performance Compensation in respect of each Performance Plan Year
commencing on January 1 of any year in the amount, for the deferral period and
in the manner provided in the Plan, if: (i) such Employee was an Eligible
Employee at January 1 of such Performance Plan Year, using January 1 of such
Performance Plan Year as the Salary Measurement Date; or (ii) the Employment
Date of such Employee was during the period January 2 through August 31,
inclusive, of such Performance Plan Year and on his or her Employment Date such
Employee was an Eligible Employee, determined using his or her Employment Date
as the Salary Measurement Date; provided, however, that in the event an
Eligible Employee shall terminate his or her Employment (other than by reason
of Retirement or Disability) during such Performance Plan Year (or thereafter
if prior to February 15th of the next succeeding Plan Year, such Employee shall
cease to be an Eligible Employee for the purpose of deferring, and shall not be
entitled to defer, any Performance Compensation in respect of such Performance
Plan Year.

     Section 3.2. Eligibility to Defer Salary. Any eligible Employee may elect
to defer all or certain portions of his or her Deferrable Salary in respect of
any Plan Year commencing on January 1of any year in the amount, for the
deferral period and in the manner provided for herein if: (i) such Employee was
an Eligible Employee at January 1 of such Plan Year using December 1 of the
year preceding such Plan Year as the Salary Measurement Date, or (ii) the
Employment Date of such Employee was during the period January 2 through August
31, inclusive, of such Plan Year and on his or her Employment Date such
Employee was an Eligible Employee, determined using his or her Employment Date
as the Salary Measurement Date.

ARTICLE IV

COMPENSATION ELIGIBLE FOR DEFERRAL: NOTICE AND PARTICIPATION

     Section 4.1. Performance Compensation. (a) Any Eligible Employee may elect
(within the time period specified in Section 4.4 of the Plan) to defer the
payment of all or a portion of his or her Performance Compensation in respect
of any Performance Plan Year, in which event such Deferred Performance Amount
(as adjusted by related Equivalents) shall be payable as Deferred Performance
Compensation under the Plan. An Eligible Employee may specify all or any
portion of his or her Performance Compensation in respect of a Performance Plan
Year for deferral; provided, that: (i) if expressed as a dollar amount, the
amount of Performance Compensation to be deferred shall be $3,600 or any
greater dollar amount thereof which is a multiple of $100; and (ii) if
expressed as a percentage of Performance Compensation in respect of such
Performance Plan Year, the amount of Performance Compensation to be deferred
shall be 5% or any greater whole percentage thereof. If a Participant selects a
dollar amount of Performance Compensation for deferral and the amount so
selected exceeds the amount of Performance Compensation available for deferral,
the Participant shall be deemed to have elected to defer 100% of his or her net
Performance Compensation for such Performance Plan Year.

     (b)  In the event the amount of a Participant’s Performance Compensation in
any Plan Year not deferred pursuant to the Plan is not sufficient to pay all
required withholding and payroll taxes and all deductions in respect of such
Participant’s participation in other benefit plans of his or her Employer, then
the amount of such Performance Compensation deferred in such Plan Year will be
reduced by the amount necessary to provide for the payment of such taxes and
deductions. If any election would result in the deferral of less than $3,600 of
Performance Compensation in a Plan Year, such election will be invalid and no
deferral of Performance Compensation will be made pursuant to such election.

X-10.3-12

 

     Section 4.2. Deferrable Salary. (a) Any Eligible Employee may elect
(within the time period specified in Section 4.4 of the Plan) to defer the
payment of all or a portion of his or her Deferrable Salary in respect of any
Plan Year, in which event such Deferred Salary Amount (as adjusted by related
Equivalents) shall be payable as Deferred Salary Compensation under the Plan.
An Eligible Employee may specify any portion of Deferrable Salary in respect of
a Plan Year for deferral; provided, that: (i) if expressed as a dollar amount,
the amount of Salary to be deferred shall be $3,600 or any greater amount which
is a multiple of $120, and (ii) if expressed as a percentage of Deferrable
Salary for such Plan Year, the amount of Salary to be deferred shall be 5 % of
Deferrable Salary for such Plan Year or any greater whole percentage thereof.

     (b)  In the event the amount of Deferrable Salary during any Plan Year not
deferred pursuant to the Plan is not sufficient to pay all required withholding
and payroll taxes and all deductions in respect of such Participant’s
participation in other benefit plans of his or her Employer, then the amount of
Salary deferred tinder the Plan in such Plan Year will be reduced by the amount
necessary to provide for the payment of such taxes and deductions. If any
election would result in the deferral of less than $3,600 of Deferrable Salary
during the Plan Year, such election will be invalid and no deferral of Salary
will be made pursuant to such election.

     Section 4.3. Participation: Notice and Agreement Procedure. (a) Any
Eligible Employee may become a Participant by giving timely notice of the
Performance Compensation or Deferrable Salary such Eligible Employee desires to
defer by executing and delivering to the Committee an Agreement as provided in
this Section 4.3 and in Section 4.4 of the Plan.

     (b)  Each Eligible Employee may elect to defer all or a portion (within the
limits specified at Sections 4.1 and 4.2 of this Article IV) of his or her
Performance Compensation for any Performance Plan Year or Deferrable Salary for
any Plan Year (as each is adjusted by related Equivalents) for payment as
Deferred Compensation under the Plan by executing and delivering to the
Committee (within the time limits specified in respect of elections to defer
specified at Section 4.4 of the Plan) one or more Agreements. Each Agreement
shall provide, among other things, for (i) the amount (expressed in dollars) or
portion (expressed as a percentage) of Performance Compensation or Deferrable
Salary to be deferred, (ii) the period such amount shall be deferred, and (iii)
the Reference Investment Fund or Funds with reference to which the Deferred
Amounts win be attributed Equivalents in accordance with Article VI of the
Plan, all in accordance with the Plan and the Rules of the Committee.

     (c)  Each Agreement shall be in one of the alternative forms as prescribed
by the Committee and shall be properly completed and executed by the
Participant and delivered to the Committee within the periods for the filing
thereof specified in Section 4.4 of the Plan. Any electronic election will be
deemed executed upon sending by Participant from a secure platform which
incorporates protected individual accounts.

     (d)  An Agreement shall be effective no earlier than the date on which it
is delivered to the Committee and shall continue in effect (unless sooner
terminated in accordance with the provisions of the Plan and the Agreement)
until the Deferred Performance Compensation or Deferred Salary attributable to
such Agreement has been paid in accordance with the Plan.

     Section 4.4. Time for Filing Elections. In order to be effective, any
election to defer Performance Compensation or Deferrable Salary in respect of
any Plan Year shall be made only by the filing of a duly executed and completed
Agreement with the Committee:

     (a)  With respect to Performance Compensation in respect of any Performance
Plan Year: (i) in the case of an Eligible Employee at January 1 of such
Performance Plan Year, not earlier than February 15 or later than March 30 of
such Performance Plan Year in respect of which such deferral election is being
or to be made, ; and (ii) in the case of an Eligible Employee whose Employment
Date occurs during such Performance Plan Year, not later than 30 days after

X-10.3-13

 

the
Employment Date of such Eligible Employee, but in no event shall such election
be permitted after September 30 of such Performance Plan Year.

     (b)  With respect to Deferrable Salary in respect of any Plan Year: (i) in
the case of an Eligible Employee at January 1 of such Plan Year, not earlier
than December 1 or later than December 31 of the calendar year prior to the
Plan Year in respect of which such election to defer Salary is being made; and
(ii) in the case of an Eligible Employee whose Employment Date occurs during
such Plan Year, not later than 30 days after the Employment Date of such
Eligible Employee and at least two weeks prior to the commencement of the
payroll period in respect of which Deferrable Salary will be deferred, but in
no event shall any such election be permitted after September 30 of such Plan
Year.

ARTICLE V

MANDATORY DEFERRALS

     Section 5.1. Designated Participants Subject to Mandatory Deferrals. Any
Performance Compensation, Salary or other cash compensation earned by any
Executive Officer which, if paid as and when due, would not be deductible by
the Company for Federal Income Tax purposes by reason of the limitations set
forth at, or the provisions of, Section 162(m) of the Code and the regulations
and rulings related thereto (for whatever reason such limitations are exceeded
or the compensation payable to such Executive Officer is not excluded therefrom
or the provisions thereof do not permit the deduction of such compensation)
shall automatically be deferred until such time as may be necessary in order
for the Company to assure the deductibility for Federal Income Tax purposes of
all such compensation when paid to such Executive Officer. The Company’s
determination of the deductibility by the Company of such compensation of any
Participant for Federal Income Tax purposes shall be final and binding on such
Participant. To the extent possible, if the Executive Officer whose
compensation is being or to be deferred has elected to defer Performance
Compensation or Salary in accordance with Article IV of the Plan, such amounts
will be so deferred prior to any deferral under this Article V. The Mandatory
Deferred Amount in respect of each Plan Year (as adjusted by Equivalents) shall
be payable as Mandatory Deferred Compensation.

     Section 5.2. Period of Deferral. All Mandatory Deferred Compensation in
respect of any Executive Officer shall be paid to such Executive Officer in a
lump sum on the later of: (1) the fifteenth (15th) day of the second calendar
year following the calendar year during which such person ceases to be an
Executive Officer and, if applicable, a director of the Company; or (2) such
later date as the officer shall elect in accordance with the provisions of
Section 5.3 of this Article V. The provisions of this Article V shall control
with respect to Mandatory Deferred Compensation and the deferral and
distribution elections provided for in Articles IV and VII of the Plan shall
not apply to any Mandatory Deferred Compensation.

     Section 5.3. Election of Deferral Period. Any Executive Officer shall have
the right to select any of the following payment date or dates if such
Executive Officer makes an election within twenty (20) days following his or
her receipt of notice from the Committee that all or a portion of his or her
Performance Compensation, Salary or other cash compensation in respect of any
Plan Year, or any combination thereof, has been or will be deferred:

		
	 	     (a) A lump sum payment of all Mandatory Deferred Compensation on the
fifteenth (15th) day of the third, fourth or fifth calendar year following the
calendar year during which such person ceased to be an Executive Officer and,
if applicable, a director of the Company; or

		
	 	     (b) A series of no less than five nor more than 15 annual installments
commencing on the fifteenth (15th) day of the second calendar year following
the calendar year during which such person ceases to be an Executive Officer
and, if applicable, a director of the Company, each installment to equal the
Mandatory Deferred Compensation of

X-10.3-14

 

		
	 	such Executive Officer then remaining in his
or her Mandatory Deferred Account, determined using the then most recent
Valuation Date, divided by the number of installments then remaining to be made
(including the installment to be paid on such distribution date).

ARTICLE VI

ACCOUNTS AND REFERENCE INVESTMENT ELECTIONS

     Section 6.1. Deferred Compensation. A Participant’s Deferred Compensation
shall be equal to the total amount of all Deferred Amounts of such Participant,
plus all Equivalents attributable to each Deferred Performance Amount and each
Deferred Salary Amount of such Participant, and credited (or charged) to, each
of the Performance Plan Accounts and Annual Salary Accounts of such Participant
pursuant to this Article VI. A Participant’s Mandatory Deferred Compensation
shall be equal to the total amount of all Mandatory Deferred Amounts and
Equivalents attributable to the Mandatory Deferred Amounts of such Participant
and credited (or charged) to such Participant’s Mandatory Deferred Accounts
pursuant to this Article VI.

     Section 6.2. Accounts. The Company and each Participating Employer shall
establish and maintain, or cause to be established and maintained, pursuant to
the terms of the Plan Accounts for each Participant, consisting of Performance
Plan Accounts, each of which will be credited with the Deferred Performance
Amount of such Participant in a Plan Year, Annual Salary Accounts, each of
which will be credited with the Deferred Salary Amount of such Participant
during such Plan Year, and Mandatory Deferred Accounts, which will be credited
with all Mandatory Deferred Amounts of such Participant during a Plan Year, in
each case to be adjusted by Equivalents attributable thereto in accordance with
this Article VI. In respect of each Participant, a separate Performance Plan
Account shall be established and maintained in respect of each Plan Year, the
balance of which at any Valuation Date represents the amount of such
Participant’s Deferred Performance Compensation for such Plan Year. In respect
of each Participant, a separate Annual Salary Account shall be established and
maintained in respect of each Plan Year, the balance of which at any Valuation
Date represents the amount of such Participant’s Deferred Salary Compensation
for such Plan Year. A separate Mandatory Deferred Account shall be established
for each Plan Year the Participant has a Mandatory Deferred Amount, the balance
of which as of any Valuation Date represents the then current amount of such
Participant’s Mandatory Deferred Compensation for such Plan Year. All amounts
(of Equivalents) credited (or charged) to an Account shall be credited (or
charged) solely for purposes of measurement, accounting, computation and
recordkeeping. The obligation of an Employer to pay the amount in its Accounts
is its general, unsecured contractual obligation and any assets maintained by
such Employer to satisfy such claims shall be subject to the claims of such
Employer’s general creditors.

     Section 6.3. Reference Investment Procedure. At the time a Participant
makes his or her election to defer Performance Compensation or Salary in
respect of any Plan Year, such Participant may express his or her choice of
Reference Investment Fund or Funds and the allocation of his or her Performance
Plan Account and Annual Salary Account among one or more such Reference
Investment Funds. Similarly, within twenty (20) days after receipt of notice
that a Mandatory Deferred Account in respect of a Plan Year will be
established, such Participant may express his or her choice of Reference
Investment Fund or Funds. The Compensation Committee shall have absolute
discretion in the selection of Reference Investment Funds available and may,
from time to time, change the available Reference Investment Funds as it deems
appropriate. Any such change of Reference Investment Funds shall be
communicated to Participants in accordance with procedures adopted by the
Committee.

     Section 6.4. Equivalents: Reference Investment Elections. (a) In
accordance with elections made by Participants in accordance with Section 6.3
and this Section 6.4, each Deferred Performance Amount, Deferred Salary Amount
and Mandatory Deferred Amount will be credit-

X-10.3-15

 

ed with earnings and gains and
charged with losses, expenses and taxes in amounts equal to the amount such
Deferred Performance Amount, Deferred Salary Amount or Mandatory Deferred
Amount would have been credited, net of all losses, expenses and taxes, or
charged (where such losses, expenses and taxes exceeded earnings and gains) if
such Deferred Performance Amount, Deferred Salary Amount or Mandatory Deferred
Amount had been invested during the relevant period in one or more of the
Reference Investment Funds in accordance with such election (such amounts being
herein referred to as “Equivalents”). On a Valuation Date an Account will be
credited with all such earnings and gains, net of all losses, expenses and
taxes, or charged for any losses, expenses and taxes to the extent such amounts
exceed earnings and gains, such Deferred Performance Amount, Deferred Salary
Amount or Mandatory Deferred Amount would have accrued if such amounts been
invested in the Reference Investment Funds selected from time to time by such
Participant (or, if applicable, in accordance with Section 6.5 of the Plan).
Equivalents in respect of any Deferred Performance Amount, Deferred Salary
Amount or Mandatory Deferred Amount (or portion thereof) shall be equal to the
amount of increase or decrease, as the case may be, net of all expenses and
taxes which would have been incurred, in the value of suc1~ Deferred Amount had
such Deferred Amount been invested in the applicable Reference Investment Fund
or Funds (in accordance with the Participant’s elections as from time to time
in effect or, if applicable, in accordance with Section 6.5 of the Plan) from
the date deferred through the applicable Valuation Date.

     (b)  Reference Investment Funds Available. The Company and the Recordkeeper
will maintain records in respect of the Accounts of each Participant which
measure in accordance with the elections made by such Participant in respect of
his or her Deferred Amounts and, if applicable, Mandatory Deferred Amounts the
earnings, gains and losses attributable to such Deferred Amounts as though
invested in one or more of the Reference Investment Funds within the categories
described below, as specifically selected by the Compensation Committee and
identified at Annex I to the Plan:

		
	 	     (1) Reference Money Market Fund. The reference investment shall be a
mutual fund or bank common trust fund which invests in various short-term U.S.
Government securities and/or similar instruments, including Treasury Bills,
certificates of deposit and other high quality instruments.

		
	 	     (2) Reference Equity Index Fund. The reference investment shall be a
mutual fund or bank common trust fund which invests in common stocks of
companies comprising the S&P 500 Index on a weighted basis substantially
similar to the weighting of the S&P 500 Index.

		
	 	     (3) Reference Bond Fund. The reference investment shall be a mutual fund
or bank common trust fund which invests in a diversified portfolio of
government and high quality corporate bonds (generally A rated or higher) with
average maturities of up to 5 years.

		
	 	     (4) Reference Balanced Fund. The reference investment shall be a mutual
fund or bank common trust fund which invests primarily in S&P 500 equities and
government and corporate bonds.

		
	 	     (5) Reference Growth Fund. The reference investment shall be a mutual fund
which focuses on growth equities.

     (c)  Changes in Reference Investment Funds Available. The Reference
Investment Funds available to Participants may be changed at any time and from
time to time by the Compensation Committee. The Committee will give timely
notice of any such change to each Participant. A Participant must change his or
her election before implementation of such change if such change eliminates the
availability of a Reference Investment Fund which was being used to measure
Equivalents to be credited (or charged) to any Account of such Participant.

X-10.3-16

 

     (d)  Plan Investment Elections. Participants shall make their reference
investment elections using the following procedures:

		
	 	     (1) Initial Election for Deferred Amounts. At the time any election to
defer Performance Compensation or Salary is made a Participant can elect to
have the Deferred Performance Amount or the Deferred Salary Amount, as the case
may be, accrue Equivalents related to one or more of the Reference Investment
Funds in five percent (5%) increments; provided, that the Participant must
complete his or her investment election no later than the deadline established
by the Committee.

		
	 	     (2) Initial Election for Mandatory Deferred Amounts. Within twenty (20)
days after a Participant receives notice that a Mandatory Deferred Account in
respect of a Plan Year will be established and a portion of such Participant’s
Performance Compensation, Salary or other cash compensation will be deferred,
such Participant can elect to have the Mandatory Deferred Amount accrue
Equivalents related to one or more of the Reference Investment Funds in whole
percentage increments; provided, that the Participant must complete his or her
investment election no later than the deadline established by the Committee.

		
	 	     (3) Change in Investment Election. Effective for the close of any business
day, a Participant may change his or her investment election for all of his
existing Accounts in whole percent increments. Such election will affect all
Deferred Amounts and Mandatory Deferred Amounts and the balance of all existing
Accounts, but shall not affect any Accounts thereafter established in respect
of future deferrals. To effect a change, the Participant must complete his
investment election under guidelines established by the Committee.

     (e)  Allocation of Reinvestments of Reference Investment Fund
Distributions. All Equivalents (earnings, gains and losses net after expenses
and taxes) attributable to any Account as measured in respect of any Reference
Investment Funds will be deemed to include any distributions by such Reference
Investment Fund, which distributions shall be deemed to be reinvested in the
same Reference Investment Fund after deducting any expenses and taxes
attributable to such reinvestment.

     (f)  Special Election Rules. The Committee may permit variations in the
administration of the Plan as it considers proper, under regulations adopted by
the Committee and published to Participants.

     Section 6.5. Failure to Elect Reference Investments. Any portion of an
Account of a Participant with respect to which such Participant has not
indicated to the Committee a Reference Investment Fund (whether due to the
failure of the Participant to timely complete and file his or her election or
otherwise) shall be deemed to accrue Equivalents as though such portion of the
Account were invested in the Reference Money Market Fund, or in such other
investment or reference rate as the Compensation Committee may select.

     Section 6.6. Adjustments to Account Balances.

     (a)  Regular Valuation Dates. As of each Valuation Date, the Company and
the Recordkeeper will determine the fair market value of each Account of each
Participant. On each Valuation Date, each Account will be adjusted to reflect
the following events in order since the preceding Valuation:

		
	 	     (1) The increase or decrease in the amount of Equivalents (the pro rata
share of the net earnings, gains and losses, net of expenses and taxes of the
Reference Investment Fund or Funds in which the Account is deemed to be
invested);

		
	 	     (2) Deferred Amounts in a new Account and Mandatory Deferred Amounts in
respect of a Mandatory Deferred Account;

X-10.3-17

 

		
	 	     (3) Distributions, if any, from the Account; and

		
	 	     (4) Changes in Reference Investment Fund or Funds under Section 6.4(d)(2)
of the Plan.

     (b)  Valuations Binding. In determining the value of each Account of each
Participant, the Committee will exercise its best judgment as to the value of
such Account. All determinations of value of Accounts shall be binding upon
Participants and their Beneficiaries.

     (c)  Allocation Date. All allocations of Equivalents will be considered to
have been made as of the Valuation Date, regardless of when allocations are
actually made.

     (d)  Statements of Account Balances. As soon as practicable after the end
of each Plan Year, the Committee will provide to each Participant, or his or
her Beneficiary, a statement showing with respect to each Account of such
Participant: (1) the balance of such Account on January 1 of such Plan Year,
(2) all Equivalents attributable to such Account during such Plan Year, (3) all
distributions from such Account during such Plan Year and (4) the balance of
such Account on December 31 of such Plan Year. During each Plan Year, the
Committee may provide statements quarterly setting forth the balance of each
Account of a Participant as at the end of a quarter and such other information
in respect thereof as the Committee shall deem appropriate. If a Participant
has Accounts with more than one Employer, the reports and records relating to
such Accounts will be reported to the Participant without indicating which
Employer established the Account, unless such Employer is bankrupt or
insolvent.

     (e)  Correction of Mistakes. In the event the Committee discovers that a
mistake has been made in an allocation to or distribution from any Account, or
any other mistake which affects an Account, it will correct the mistake as soon
as practicable. If an overpayment has been made, the Committee will seek cash
reimbursement. If an underpayment has been made, the amount of the underpayment
will be paid pursuant to Article XIII unless the committee determines the
amount to be minimal, in which case it will be paid as a lump sum payment.

     Section 6.7. No Responsibility for Results of Reference Investment Funds.
The Company shall not, and the Participating Employers, the Board of Directors,
the Compensation Committee and the Committee shall not, have any responsibility
or liability in the event any Reference Investment Fund selected by any
Participant shall result in any reduction in any Deferred Amount or Mandatory
Deferred Amount or reduce from one Valuation Date to the next Valuation Date
the amount of such Participant’s Deferred Compensation or Mandatory Deferred
Compensation, or both, or fail to result in any increase of Deferred
Compensation or Mandatory Deferred Compensation.

ARTICLE VII

PAYMENT OF DEFERRED COMPENSATION

     Section 7.1. Distributions Events. Deferred Compensation under the Plan
shall be payable as follows:

     (a)  Termination for Other than Retirement. Disability or Death. In the
event that a Participant’s Employment with the Company on any Participating
Employer shall be terminated by reason of voluntary termination, layoff due to
job elimination or job relocation, involuntary termination for any reason or
any other termination for any other reason other than his or her death,
Disability or Retirement, the entire amount of his or her Deferred Compensation
shall be paid within sixty (60) days after such termination of Employment;
provided, however, that if a Participant is an employee of any Subsidiary of
the Company, such Participant shall not be deemed to have terminated his or her
employment with the Company for the purpose of this Section 7.1, although such
Participant shall no longer be an Eligible Employee if such Subsidiary is not a
Participating Employer.

X-10.3-18

 

     (b)  Death of Participant. In the event of a Participant’s death (whether
before or after his or her Retirement or Disability), the entire amount of his
or her Deferred Compensation shall be paid to his or her Beneficiaries in a
lump sum within sixty (60) days after the date of such Participant’s death.

     (c)  Termination of Employment by Retirement or Disability. In the event a
Participant shall terminate after meeting the requirements for Retirement or
qualifies for Disability benefits under the Retirement Plan (or similar plan of
a Participating Employer) or the Company’s Long Term Disability Income Plan,
the distribution of his or her Deferred Compensation shall be made in
accordance with the election of such Participant made in accordance with
subsection (d) or subsection (e) of this Section 7.1, or, if no election has
been made by such Participant, in accordance with Section 7.2 of the Plan.

     (d)  In accordance with Elections. A Participant may, at the time he or she
notifies the Committee of his or her election to have all or a portion of his
or her Deferrable Salary or Performance Compensation in respect of any Plan
Year payable as Deferred Compensation under the Plan, specify the payment of
such Deferred Compensation only in the following forms thereof:

		
	 	     (i) In a lump sum on the 15th of January following the second anniversary
of the date such election of the Deferred Salary Amount or Deferred
Performance Amount was made.

		
	 	     (ii) In a lump sum on the fifteenth (15th) day of January of the year
following the year of such Participant’s Retirement or Disability; or

		
	 	     (iii) In annual installments over a period of not less than five (5) or
more than fifteen (15) years, commencing in each case on the 15th day of
January of the year following the date of such Participant’s Retirement or
Disability, each installment to equal the aggregate amount of all Deferred
Compensation of such Participant then remaining in his or her Account or
Accounts subject to such election, determined as at the Valuation Date
immediately prior to such distribution date, divided by the number of
installments then remaining to be made (including the installment to be paid on
such distribution date).

     (e)  Extension of Deferral Period. If the deferral period for any Deferred
Amount specified by a Participant in an effective Agreement (or in any
subsequent election form pursuant to this subsection (e)) is two years (as
provided in clause (i) of subsection (d) of this Section 7.1), such Participant
may extend the deferral of such Deferred Amount at his or her election to any
date permitted by Section 7.1(d) if, and only if, such election is made at
least twelve (12) months prior to the expiration of the deferral period
provided under such Agreement (or subsequent election form) and in the calendar
year prior to the calendar year during which such Deferred Compensation would
have been paid but for this clause.

     Section 7.2 Elections of Deferral Period and Payment Forms. With respect
to any Deferred Amount of an active Employee, the period of deferral and form
of distribution will be paid in accordance with the elections in Section 7.1
except as otherwise determined under this Section 7.2 as follows:

     (a)  Absence of Deferral Period Election. With respect to any Deferred
Amount of a Participant for which no effective election as to time of payment
has been filed with the Committee, such related Deferred Compensation will be
paid in a lump sum on the earlier of (a) the second (2nd) anniversary of (i)
the date such Deferred Performance Amount would have been paid (but for such
deferral election) or (ii) the fifteenth (15th) day of January of the year
following the Plan Year during which such Deferred Salary Amount would have
been paid (but for such deferral election), or (b) the fifteenth (15th) day of
the year following the year of such Participant’s Retirement or Disability.

X-10.3-19

 

     (b)  An employee may change an election made under 7.1(d)(ii) or (iii) for
his form of distribution if the election is at least 12 months before
retirement. Such extension or change in the election will not be valid until
the 12 months have expired. If a distribution would have otherwise been made
under this Article VII pursuant to the last election applicable to such
deferred Compensation before the expiration of the 12 months, then the prior
election will control the time and form of distribution.

     (c)  Notwithstanding the other provisions of this Section 7.2, employees or
retirees may elect to have any or all of their Deferred Compensation paid out
as soon as administratively possible in a lump sum payment made at 90% of their
Deferred Compensation payable under the other provisions of this Section 7.2.

     Section 7.3. Minimum Balance. Notwithstanding the foregoing, in the event
that an Participant’s Employment is terminated for any reason and the aggregate
undistributed amount of all of his or her Deferred Compensation is $50,000 or
less, as at the Valuation Date immediately prior to such termination of
Employment, the entire amount of all of his or her Accounts shall be paid in a
lump sum within sixty (60) days after his or her termination of Employment.

ARTICLE VIII

PAYMENTS FROM THE PLAN

     Section 8.1. Timing Amount and Form of Payment. Each payment of a
Participant’s Deferred Compensation, and, if applicable, Mandatory Deferred
Compensation, to such Participant will be subject to the following rules and
any other rules adopted from time to time by the Committee and uniformly
applied:

     (a)  Timing of Payment. The Committee will cause the Company (or other
Employer, as applicable) to pay, or cause to be paid, the Deferred Compensation
of a Participant to such Participant or his or her Beneficiaries at the time or
times specified in Article VII of the Plan and in the Agreement or other
payment election form submitted to the Committee in accordance with the terms
of the Plan. The Committee will cause the Company (or other Employer, as
applicable) to pay, or cause to be paid, Mandatory Deferred Compensation of a
Participant to such Participant or his or her Beneficiaries at the time or
times specified at Article V of the Plan and in any payment election form
submitted to the Committee in accordance with the terms of the Plan.

     (b)  Amount of Payment. Each amount of Deferred Compensation, and, if
applicable, Mandatory Deferred Compensation, to be paid to a Participant will
be determined as of the Valuation Date on or next preceding the date such
payment is due to such Participant.

     (c)  Medium of Payment. Each Participant or his or her Beneficiaries will
receive all payments of such Participant’s Deferred Compensation and Mandatory
Deferred Compensation in cash.

     Section 8.2. Acceleration of Payment upon Change of Control. In the event
a Change of Control occurs, the entire amount of Deferred Compensation and
Mandatory Deferred Compensation of each Participant shall be immediately paid
to such Participant (or, if applicable, his or her Beneficiaries) and no
additional deferrals of Performance Compensation, Salary or other cash
compensation will be made under the Plan (notwithstanding any outstanding
election for such deferrals) and the Plan shall automatically terminate
effective as of the Change of Control Date.

ARTICLE IX

SOURCE OF PAYMENTS

     Section 9.1. Payments from General Funds of Employers and Rabbi Trusts.
All payments of Deferred Compensation and Mandatory Deferred Compensation under
and in accor-

X-10.3-20

 

dance with the Plan shall be paid in cash from the general funds of
the applicable Employer and there shall be no requirement that any special or
separate trust, fund or account shall be established in the name of any
Participant or Beneficiary or other segregation of assets made to assure such
payments; provided, however, that each of the Company and the Participating
Employers intends to establish a Trust and may establish a bookkeeping reserve
to meet its obligations under the Plan. To the extent that any Participant,
Beneficiary or other person has a right to receive payments of Deferred
Compensation or Mandatory Deferred Compensation from the Company or a
Participating Employer under the Plan, such right shall be no greater than the
right of any unsecured general creditor of the Company or such Participating
Employer.

     Section 9.2. The Trusts. (a) A Trust to be known as the Rabbi Trust for
the Deferred Compensation Plan for Executives of the Company (the “Company
Trust”) will be established pursuant to a Trust Agreement between the Company
and the Trustee and is intended to be maintained as a “grantor trust” under
section 671 of the Code. The assets of the Company Trust will be held, invested
and disposed of by the Trustee in accordance with the terms of the Company
Trust, for the exclusive purpose of paying Deferred Compensation and Mandatory
Deferred Compensation to Participants or their Beneficiaries as and when due
under the Plan. The assets of the Company Trust shall at all times be subject
to the claims of the Company’s general creditors in the event of the Company’s
insolvency or bankruptcy.

     (b)  Each Participating Employer shall prior to permitting any Eligible
Employee to participate in the Plan, enter into and maintain a Trust for the
Deferred Compensation Plan for Executives of the Company for Participants who
are Employees of such Participating Employer (each an “Employer Trust”), which
shall be established pursuant to a Trust Agreement between such Participating
Employer and the Trustee and shall be intended to be maintained as a “grantor
trust” under 671 of the Code. The assets of each Employer Trust will be held,
invested and disposed of by the Trustee in accordance with the terms of the
Employer Trust for the exclusive purpose of paying Deferred Compensation to
Participants Employed by such Participating Employer or their Beneficiaries as
and when due under the Plan. The Assets of each Employer Trust shall at all
times be subject to the claims of the general creditors of the Participating
Employer that established such trust in the event of such Participating
Employer’s insolvency or bankruptcy.

     (c)  The Company Trust and each Participating Employer Trust (herein
collectively referred to as the “Trusts”) shall each contain substantially the
same provisions and have the same Trustee and shall, to the extent practicable,
be administered and invested jointly, except that the assets shall be separate
and subject only to the general creditors of the Employer which is the grantor
of the applicable Trust.

     Section 9.3. Contributions and Expenses. The Company and Participating
Employers may, from time to time, make contributions to their respective Trusts
in accordance with the applicable Trust Agreement and the Plan. Deferred
Compensation and Mandatory Deferred Compensation payable under the Plan and
expenses chargeable to the Participants in accordance with the Plan are
intended first to be paid from the applicable Trusts. To the extent the funds
in such Trusts are not sufficient (or are not paid by the Trustee), all
Deferred Compensation and Mandatory Deferred Compensation shall be paid by the
Company or the applicable Participating Employer.

     Section 9.4. Trustee Duties. The powers, duties and responsibilities of
the Trustee shall be as set forth in the Trust Agreements and nothing contained
in the Plan, either expressly or by implication, shall impose any additional
powers, duties or responsibilities upon the Trustee. The Trustee shall make
investments in the Trusts as directed by the Committee, consistent with the
provisions of the Plan and the Trust Agreements. The Trustee may hold cash and
other liquid investments in such amounts as the Committee may deem appropriate.

X-10.3-21

 

     Section 9.5. Reversion of Trust Funds to Company or Participating
Employer. (a) The Company shall have no beneficial interest in the Company
Trust and no part of the Company Trust shall revert or be repaid to the
Company, except as expressly provided in the Plan or the Trust Agreement which
establishes the Company Trust.

     (b)  No Participating Employer shall have a beneficial interest in such
Employer’s Employer Trust and no part of such Employer Trust shall revert or be
repaid to such Participating Employer, except as expressly provided in the Plan
or the Trust Agreement which establishes such Employer Trust.

ARTICLE X

DESIGNATION OF BENEFICIARIES

     Section 10.1. Designation Procedure. Each Participant may designate one
beneficiary or several beneficiaries (such beneficiary or beneficiaries of a
Participant herein referred to as the Participant’s “Beneficiaries”) to receive
any balance, or portion thereof, of his or her Accounts which may be payable
under the Plan upon his or her death. To be effective, each designation must be
in writing on a form provided by the Committee and must be signed and filed by
the Committee prior to the Participant’s death. Each Participant may name one
or more primary Beneficiaries and one or more contingent Beneficiaries;
provided that if a Participant names more than one Beneficiary, the Participant
shall designate the percentage payable to each. A Participant may from time to
time revoke or change his or her Beneficiaries designation without the consent
of any Beneficiary by filing a new designation with the Committee, and each
change will revoke all prior designations of Beneficiaries. The last. such
designation of Beneficiaries received by the Committee shall be controlling;
provided, however, that no designation, or change or revocation thereof, shall
be effective unless received by the Committee prior to the Participant’s death,
and in no event shall it be effective as of a date prior to such receipt.

     (b)  Absence of Designation. If no designation of Beneficiaries is in
effect at the time of a Participant’s death, if no designated Beneficiary
survives the Participant, or if the Participant’s designation of Beneficiaries
conflicts with law, then the Participant’s estate shall be the Beneficiary
entitled to receive all Deferred Compensation and, if applicable, Mandatory
Deferred Compensation then unpaid. The Committee may direct the Company or any
Participating Employer to retain such unpaid Deferred Compensation and, if
applicable, Mandatory Deferred Compensation, without liability for any interest
thereon or other earnings or gains thereon, until the rights thereto are
determined, or the Committee may direct the Company or Participating Subsidiary
to pay such unpaid Deferred Compensation and, if applicable, Mandatory Deferred
Compensation, into any court of appropriate jurisdiction, and such payment
shall completely discharge all liability of the Company and, if applicable, any
Participating Employer for unpaid Deferred Compensation and, if applicable,
Mandatory Deferred Compensation.

     (c)  Payment to Minor or Incompetent Beneficiaries. In the event a deceased
Participant’s Beneficiary is a minor, is legally incompetent, or cannot be
located after reasonable effort, the Committee will make payment to the
court-appointed guardian or representative of such Beneficiary, or to a trust
established for the benefit of such Beneficiary, as applicable.

     (d)  Judicial Determination. In the event the Committee for any reason
considers it improper to direct any payment as specified in this Section 10.1,
it may have a court of competent jurisdiction determine to whom payments should
be made, in which event all expenses incurred in obtaining such determination
may be deducted from the unpaid Deferred Compensation and, if applicable,
Mandatory Deferred Compensation or charged to the payee. Any such payment shall
constitute a complete discharge of all liability of the Employers to such
Participant under the Plan.

X-10.3-22

 

     Section 10.2. Payment to Participant’s Representative. If a Participant is
incompetent to handle his or her affairs as of any date designated by such
Participant as a date on which a payment of all or a portion of such
Participant’s Deferred Compensation or Mandatory Deferred Compensation, or
both, is to be made, the Committee will make any payments due to such
Participant to his or her court-appointed personal representative or, if none
is appointed, the Committee may in its discretion make payments to his or her
spouse, a child, a parent, or a brother or sister, or any other person deemed
by the Committee to have incurred expenses for the care or maintenance of such
Participant, in such manner and proportions as the Committee may determine;
provided that the Committee may request a court of competent jurisdiction to
determine the payee, in which event all expenses incurred in obtaining the
determination may be deducted from the unpaid Deferred Compensation and, if
applicable, Mandatory Deferred Compensation or charged to the payee. Any such
payment shall constitute a complete discharge of all liability of the Employers
to such Participant under the Plan.

     Section 10.3. Unclaimed Benefits. In the event the Committee cannot
locate, with reasonable effort, any person entitled to receive a Participant’s
unpaid balance of Deferred Compensation and, if applicable, Mandatory Deferred
Compensation, the obligation of the Employer to make any payment of such
Participant’s Deferred Compensation and, if applicable, Mandatory Deferred
Compensation, will be canceled on the fifth anniversary after the first day on
which a payment of such Deferred Compensation was due to be paid, but will be
reinstated within sixty (60) days after the Participant or a Beneficiary is
located.

ARTICLE XII

ADMINISTRATION OF PLAN

     Section 11.1. Administration. The Plan shall be administered by the
Committee, as appointed by the Compensation Committee. Determinations by the
Committee as to any questions arising under the Plan shall be final, conclusive
and binding upon all persons including Participants, Beneficiaries, the Company
and Participating Employers. A member of the Committee who is also a
Participant must abstain from voting on any matter relating to his or her
participation in the Plan or to his or her Deferred Compensation or Mandatory
Deferred Compensation.

     Section 11.2. Allocation of Fiduciary Responsibilities: Composition and
Powers of Committee. The fiduciaries will have the powers and duties described
below, and may delegate their duties to the extent permitted under ERISA:

		
	 	     (a) Company. The Company, through the Compensation Committee, will be
responsible for appointing and removing Committee members, approving the
adoption of the Plan by each new Participating Employer and designating
Eligible Employees.

		
	 	     (b) The Committee.

		
	 	     (1) Appointment and Termination of Office. The Committee will consist of
not less than three (3) or more than five (5) individuals who will be appointed
by and serve at the pleasure of the Compensation Committee. The Compensation
Committee will have the right to remove any member of the Committee at any
time. A member of the Committee may resign at any time by written resignation
to the Committee and the Compensation Committee. The Compensation Committee
will appoint a successor to fill any vacancy in the Committee’s membership.

		
	 	     (2) Organization of Committee. The Committee will elect a Chairman from
among its members, and will appoint a Secretary who may or may not be a
Committee member. The Committee may appoint or retain such agents (including
legal counsel and accountants) who may or may not be Committee members, as it
considers necessary for the effective performance of its duties in
administering the

X-10.3-23

 

		
	 	Plan, and may delegate to such agents such ministerial powers
and duties as it considers expedient or appropriate. The Committee may fix the
compensation of the agents within the limits set by the Compensation Committee.
Committee members who are employed by the Company or a Participating Employer
shall serve as such without additional compensation.

     (3)  Committee Meetings. The Committee will hold meetings at least
annually. A majority of the members then in office will constitute a quorum.
All actions of the Committee may be taken with or without a meeting. Each
action of the Committee taken at a meeting shall be taken on a majority vote of
all members of the Committee then in office. Any action taken without a meeting
shall be in writing and signed by a majority of the members of the Committee
then in office. The Committee may establish such other rules and procedures for
taking action with or without a meeting as it shall deem appropriate.

     (4)  Powers of the Committee. The Committee will have primary
responsibility for administering the Plan, and all powers necessary to enable
it to properly perform its duties, including but not limited to the following
powers and duties:

		
	 	     (A) Rules. The Committee may adopt rules, regulations and procedures as it
deems necessary for the performance of its duties under the Plan, except to the
extent that such rules, regulations and procedures conflict with the express
provisions of the Plan or written policies or directives of the Compensation
Committee.

		
	 	     (B) Interpretation. The Committee will have the power to interpret the
Plan and to decide all questions arising under the Plan; provided, however,
that the Compensation Committee shall also have the power and authority to
interpret the Plan and interpretations, rules and regulations adopted by the
Compensation Committee shall control.

		
	 	     (C) Individual Accounts. The Committee, or the Recordkeeper acting for it,
will maintain individual Accounts for each Participant and will allocate
Equivalents in respect of Deferred Amounts to the proper Accounts.

		
	 	     (D) Participant Data. The Committee will request from the Company and the
Participating Employers complete information regarding the Deferred Amounts and
Mandatory Deferred Amounts of each Participant and such other information as it
considers necessary from time to time, and will treat Employer records as
conclusive with respect to such information.

		
	 	     (E) Payments. The Committee will direct the payment of Account balances
from the Trust (or from the Company or the Participating Employer, as the case
may be), and will specify the Participant (or Beneficiary or Beneficiaries) to
be paid and the amount, the time and the conditions, if any, of each payment.

		
	 	     (F) Disclosure. The Committee will prepare and distribute, or cause to be
prepaid and distributed, to the Participants copies of the Plan, notices and
other information about the Plan in such manner as it deems appropriate and in
compliance with applicable law.

		
	 	     (G) Agreements and Other Forms. The Committee will provide forms of
Agreements for use by Eligible Employees to elect to participate in the Plan
and other forms for use by Participants in respect of their participation in
the Plan.

X-10.3-24

 

		
	 	     (H) Financial Information. The Committee will periodically prepare, or
cause to be prepared, reports of the Plan’s operation and will submit a copy of
each report to the Compensation Committee and cause a copy to be maintained in
the office of the Secretary of the Company and each Participating Employer.

		
	 	     (I) Reporting and Tax Returns. The Committee will cause to be filed all
reports and tax returns required under ERISA and the Code.

     Section 11.3. Indemnification. The Company and each of the Participating
Employers will indemnify and hold harmless the Committee and each member, and
each person to whom the Committee has delegated responsibility under this
Article XI (each an “Other Person”), from and against any and all losses,
costs, liabilities or expenses that may be imposed upon or incurred by them in
connection with or resulting from any claim, action, suit, or proceeding to
which any member of the Committee or such Other Person is or may be a party or
may be involved by reason of any action taken or failure to act under the Plan,
or for any other reason, and from and against any and all amounts paid by the
members of the Committee (or any of them) or such Other Person or Persons in
settlement (if with the Company’s approval) of, or paid by them in satisfaction
of a judgment in, any such action, suit or proceeding and from and against any
other joint or several liability for their acts and omissions and for the acts
and omissions of their duly appointed agents in the administration of the Plan,
except for their own willful breach of fiduciary duty or willful misconduct.

     Section 11.4. Claims Procedures. (a) Application for Payment of Deferred
Compensation or Mandatory Deferred Compensation. The Committee will, if
possible, furnish to each Participant timely information concerning
distributions of Deferred Compensation or Mandatory Deferred Compensation due
under the Plan to such Participant at least one year prior to the anticipated
date of such distribution. The Committee may require any Participant,
Beneficiary or other person claiming the right to receive payments of Deferred
Compensation or Mandatory Deferred Compensation under the Plan to submit a
written application, together with such information as the Committee considers
necessary to process the claim.

     (b)  Action on Application. Within ninety (90) days after receipt of an
application and all necessary information, the Committee will furnish the
claimant a written notice of its decision. If the Committee denies the claim in
whole or in part, the notice will set forth (1) specific reason for the denial,
with specific reference to Plan provisions upon which the denial is based; (2)
a description of any additional information or material necessary to process
the application with an explanation why such material or information is
necessary; and (3) an explanation of the claim review procedure under the Plan.

     (c)  Claim Review. Any Participant, Beneficiary or other claimant who does
not agree with the decision rendered on the application may request that the
Committee review the decision. Each request for review must be made in a
writing addressed to and filed with the Committee within sixty (60) days after
the claimant receives the decision, or if the application has neither been
approved nor denied within the 90-day period specified in subsection (b), then
the request must be made within 60 days after expiration of the 90-day period.
Concurrently with filing the request for review the claimant may submit in
writing to the Committee a statement of the issues raised by his appeal and
supporting arguments and comments. Where the Committee believes that the issues
raised by the claimant’s appeal may be more efficiently or fairly processed by
taking testimony of the claimant or others, it will set the matter for oral
hearing and give the claimant reasonable notice of the time and place. The
Committee will proceed promptly to resolve all issues raised by the claimant’s
appeal and will render a written decision on the merits within 60 days
following the claimant’s request for review. Any determination by the Committee
after completion of the review process set forth herein shall be binding upon
the Company and the claimant.

X-10.3-25

 

ARTICLE XII

AMENDMENT AND TERMINATION

     Section 12.1. Amendment of the Plan. The Plan may be amended, modified or
suspended by the Company pursuant to action taken by the Board of Directors or
by the Compensation Committee; provided, however, that no such action shall
have the effect of reducing or eliminating any Account balance as at the
effective date of any such amendment, modification or suspension or otherwise
impairing or adversely affecting the rights of any Participant or Beneficiary
to payment of Deferred Compensation or Mandatory Deferred Compensation under
the Plan which had accrued prior to the date of such action. In the event of
any amendment to, or modification or suspension of, the Plan, the Company will
promptly notify each Participant of such amendment, modification or suspension
of the Plan. Any such amendment shall be made by, and any such modification or
suspension shall be evidenced by, written instrument executed by the Company.

     Section 12.2. Termination of the Plan. Although the Company expects the
Plan to be continued indefinitely, the Company reserves the absolute right to
terminate the Plan at any time by action taken by the Board of Directors or the
Compensation Committee. In the event of any termination of the Plan, the
Company will promptly notify each Participant of such termination of the Plan
and will cause all Deferred Compensation and Mandatory Deferred Compensation to
be paid to the Participants or their Beneficiaries on or before (or as soon as
practicable following) the effective date of such termination of the Plan.

ARTICLE XIII

MISCELLANEOUS PROVISIONS

     Section 13.1. No Assignment. The right of any Participant or any of his or
her Beneficiaries to receive Deferred Compensation and, if applicable,
Mandatory Deferred Compensation under the Plan shall not be assigned,
anticipated, transferred, pledged or encumbered, either voluntarily or by
operation of law, nor shall any amount of a Participant’s Deferred Compensation
or Mandatory Deferred Compensation be subject to the claim or legal process of
any creditor of such Participant, or subject to seizure for payment of any
debts or judgments, except as provided in Article X of the Plan with respect to
designation of Beneficiaries and except as may otherwise be required by law. If
any Participant shall, or shall attempt to, assign, transfer, pledge or
encumber any amount payable under the Plan, or if by reason of such
Participant’s bankruptcy or other event happening at any time any such payment
would be made subject to his or her debts or liabilities or would otherwise
devolve upon anyone else and not be enjoyed by him or her or his or her
Beneficiary, the Compensation Committee may, in its sole discretion, terminate
such Participant’s right to any such payment of Deferred Compensation, and, if
applicable, Mandatory Deferred Compensation and direct that the same be held
and applied to or for the benefit of such Participant or his or her spouse,
children or other dependents, or any of them, in such manner as the
Compensation Committee may deem appropriate.

     Section 13.2. Adoption of and Withdrawal from Plan by a Participating
Employer. (a) Any domestic wholly-owned subsidiary of the Company which at the
time is not a Participating Employer, may, with the consent of the Committee,
adopt the Plan and become a Participating Employer by causing an appropriate
written instrument evidencing such adoption to be executed pursuant to the
authority of its board of directors and filed with the Company and by executing
a Trust Agreement in form and substance satisfactory to the Committee.

     (b)  Any Participating Employer may, by action of its board of directors,
withdraw from the Plan, such withdrawal to be effective upon notice in writing
to the Committee, and shall thereupon cease to be an Employer for all purposes
of the Plan. A Participating Employer shall be deemed automatically to withdraw
from the Plan in the event it shall cease to be a wholly owned subsidiary of
the Company. The withdrawal of a Participating Employer shall be treated as a
termination of the Plan with respect to such Employer and with respect to
Participants

X-10.3-26

 

who at the time are employed by such Employer, except that any
Participant employed by the withdrawing Employer who is transferred to or
continues in Employment with any other Employer shall remain unaffected by such
withdrawal and such Participant shall continue as a Participant under the Plan.

     Section 13.3. Information Required. Each Participant shall provide the
Committee with such pertinent information concerning himself or herself and his
or her Beneficiaries relating to Plan participation by the Participant as the
Committee may specify, and no Participant or Beneficiary or other person shall
have any rights in or be entitled to any payments of Deferred Compensation
under the Plan unless such information is provided to the Committee.

     Section 13.4. Elections by Eligible Employees. AM elections, designations,
requests, notices, instructions and other communications from an Eligible
Employee, Participant, Beneficiary or other person to the Committee required or
permitted under the Plan shall be in such form as is prescribed from time to
time by the Committee, shall be mailed by first-class mail, transmitted by
facsimile or delivered to such location as shall be specified by the Committee
and shall be deemed to have been given and delivered only upon actual receipt
thereof by the Committee at such specified location.

     Section 13.5. Notices by Committee or any Employer. All notices,
statements, reports and other communications from the Committee or any Employer
to any Eligible Employee, Participant, Beneficiary or other person required or
permitted under the Plan shall be deemed to have been duly given when delivered
to, or when mailed first-class mail, postage prepaid and addressed to, such
Eligible Employee, Participant, Beneficiary or other person at his or her
address last appearing on the records of the Company or the applicable
Participating Employer or when hand delivered to such person.

     Section 13.6. No Employment Contract or Commitment. The Plan is not, and
shall not be deemed to constitute, a contract of employment between the
Company, or any other Employer or other Subsidiary or Affiliate of the Company,
and a Participant. Neither the Plan nor any action taken hereunder by the
Company or any Participating Employer shall constitute a commitment or
agreement to continue the Employment of any Participant or shall be held or
construed to confer on a Participant any right to continued Employment with the
Company or any Participating Employer or any other Subsidiary or Affiliate of
the Company, or as a commitment to continue the rate of compensation of any
Participant, or as affecting the right of the Company or any Participating
Employer to terminate the Employment of any Participant, Eligible Employee or
any other employee at any time, with or without cause.

     Section 13.7. Severability. In the event any provision of the Plan shall
be held invalid or illegal for any reason, any illegality or invalidity shall
not affect the remaining parts of the Plan and the Plan shall be construed and
enforced as if the illegal or invalid provision had been omitted, and the
Company shall have the privilege and opportunity to correct and remedy
questions of illegality or invalidity by amendment as provided in the Plan.

     Section 13.8. Effect of IRS Determination. If any Deferred Amount is found
in a “determination” (within the meaning of Section 1313(a) of the Code) to
have been includible in gross income by a Participant prior to the payment
thereof as provided under the Plan, such Deferred Amount (as adjusted by
Equivalents to the applicable Valuation Date) shall be immediately paid to such
Participant notwithstanding such Participant’s election or any other provision
of the Plan.

     Section 13.9. Taxes and Withholding. All payments of Deferred Compensation
and Mandatory Deferred Compensation in accordance with the Plan shall be
subject to such withholding for taxes and deductions for payroll and other
taxes (federal, state or local) as may be due thereon and the determination by
the Committee as to the amounts withheld from such payments shall be binding
upon each Participant and his or her Beneficiaries.

X-10.3-27

 

     Section 13.10. No Rights to Assets Created. The obligations of the Company or
any Participating Employer to make payments of Deferred Compensation and
Mandatory Deferred Compensation under the Plan shall constitute a liability of
the Company or a Participating Employer, as the case may be, to the Participant
and his or her Beneficiaries. Such payments of Deferred Compensation and
Mandatory Deferred Compensation shall be made from the general funds of the
Company or the Participating Employer, as the case may be, or from the Trusts.
Neither the Company nor any Participating Employer shall be required to
establish or maintain the Trusts or any special or separate fund or trust or
otherwise to segregate assets to assure that such payments shall be made, and
neither a Participant nor his or her Beneficiaries shall have any interest in
any particular asset of the Company or any Participating Employer or in the
Trusts or any other trust by reason of the Company’s (or a Participating
Employer’s) obligations hereunder. Nothing contained in the Plan shall create
or be construed as creating a trust of any kind or any other fiduciary
relationship between the Company or any Participating Employer and a
Participant or his or her Beneficiaries.

     Section 13.11. Precedent. Except as otherwise specifically provided, no
action taken in accordance with the Plan by the Employers or the Committee
shall be construed or relied upon as a precedent for similar action under
similar circumstances.

     Section 13.12. No Guarantees. No employer guarantees that any Reference
Investment Fund will not result in a reduction of, or loss to, any Deferred
Amount, Mandatory Deferred Amount, Deferred Compensation or Mandatory Deferred
Compensation or any Account. Neither the Company, nor any Participating
Employer nor the Trustee guarantees the amount or payment of any Deferred
Compensation, Mandatory Deferred Compensation or other amount payable to any
Participant under the Plan.

     Section 13.13. Expenses. The expenses of administration of the Plan,
including the payment of the fees of the Trustee and the Recordkeeper, shall be
paid by the Company.

     Section 13.14. Claims of Other Persons. The provisions of the Plan shall
in no event be construed as giving any person, firm or corporation any legal or
equitable right as against the Company or any Participating Employer or their
respective officers, directors or employees, except as expressly provided for
in the Plan.

     Section 13.15. Captions. The captions preceding the Articles, Sections and
subsections hereof have been inserted solely as a matter of convenience and in
no way define or limit the scope or intent of any provisions thereof.

     Section 13.16. Validity of the Plan. The validity of the Plan shall be
determined, and the Plan shall be governed by and construed and interpreted, in
accordance with the laws of the State of Ohio.

     Section 13.17. Plan Binding on Parties. The Plan shall be binding upon the
Employees, all Participants and Beneficiaries, and, as the case may be, the
heirs, executors, administrators, successors and assigns of each of them.
Obligations incurred by the Company or any Participating Employer shall be
binding upon the Company or such Participating Employer, as the case may be,
and shall inure to the benefit of the Participants or their Beneficiaries.

X-10.3-28

 

* * *

Executed at Akron, Ohio, this 20th day of December, 2002.

	 	 	 	 	 
	 	 	 	 	The Goodyear Tire & Rubber Company
	 
	 	 	
By:
	 	/s/ Donald D. Harper

Vice President
	 
	ATTEST:	 	 	 	 
	 
	/s/ Bertram Bell

	 	 	 	 

X-10.3-29

 

ANNEX I

TO

THE GOODYEAR TIRE & RUBBER COMPANY

DEFERRED COMPENSATION PLAN FOR EXECUTIVES

The Reference Investment Funds are as follows:

	1.	 	Money Market Fund. The Benchmark Fixed Income — Government Select Portfolio.
	 
	2.	 	Bond Fund. The Benchmark Short-Intermediate Bond Portfolio.
	 
	3.	 	Equity Index Fund. The Benchmark Equity Index Portfolio.
	 
	4.	 	Balanced Fund. The Benchmark Balance Portfolio.
	 
	5.	 	Growth Fund. The American Century Ultra Investment Fund.

X-10.3-30

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