Contract
| Performance Share Grant Agreement | Exhibit 10.6 |
1. The Performance Share Unit Grant for the number of Units specified on the award summary
page is granted to you under, and governed by the terms and conditions of, the 2008 Performance
Plan of The Goodyear Tire & Rubber Company, adopted effective April 8, 2008 (the “Plan”), and this
Grant Agreement. As your awards are conveyed and managed online, your online acceptance
constitutes your agreement to, and acceptance of, all terms and conditions of the Plan and this
Grant Agreement. You also agree that you have read and understand the provisions of the Plan, this
Grant Agreement and Annex A. All defined terms used in this Grant Agreement have the meanings set
forth in the Plan.
2. All rights conferred upon you under the provisions of this Grant Agreement are personal to
you and no assignee, transferee or other successor in interest shall acquire any rights or
interests whatsoever under this Grant Agreement, which is made exclusively for the benefit of you
and the Company, except by will or the laws of descent and distribution.
3. As further consideration for the Units granted to you hereunder, you must remain in the
continuous employ of the Company or one or more of its Subsidiaries until December 31, 20___, the
end of the Performance Period. Any Units earned will be prorated in the event of your death,
Retirement (defined as termination of employment at any age after 30 or more years, or at age 55 or
older with at least 10 years, of continuous service with the Company and its Subsidiaries) or
Disability (defined as termination of employment while receiving benefits under a long-term
disability income plan maintained by the Company or one of its Subsidiaries) prior to completion of
the Performance Period. Any proration is based on the last day you worked. Nothing contained
herein shall restrict the right of the Company or any of its Subsidiaries to terminate your
employment at any time, with or without cause.
4. You will forfeit the right to receive any distribution or payment under this award if you
enter into a relationship either as an employee, consultant, agent or in any manner whatsoever with
an entity that sells products in competition with products sold by the Company and its Subsidiaries
within six months after the earlier of (1) the date you receive your distribution of Units earned
or (2) the date you cease to be an employee of the Company or one of its Subsidiaries.
5. The number of Units earned will be paid as follows:
(a) Each Unit earned will be valued at a dollar amount equal to the Fair
Market Value of the Common Stock on December 31, 20___(the “Unit Value”).
(b) The Company will pay to you an amount equal to 50% of the Unit Value
multiplied by the total number of Units earned in cash and an amount equal to 50% of
the total number of units earned in shares of Common Stock, less such withholding and payroll taxes as the Company
shall determine to be necessary or appropriate (withholding and payroll taxes to be
deducted from the cash portion of the payment) by March 15, 20___; provided, however,
that notwithstanding the foregoing, you may elect, by delivering a written notice of
your election to the Company not later than June 30, 20___, to defer all or a
specified whole
percentage of the aforesaid Units earned until the Optional Deferral
Date (as defined below), in which event the amount you elect to defer (which shall
be equal to the product of UE x PDE, where UE equals the number of Units earned and
PDE equals the percentage, expressed as a decimal, of the Units earned you elect to
defer) will be credited by March 15, 20___to an account maintained in the records of
the Company (the “Optional Deferred Amount”) and will be converted into Deferral
Units (as defined below). The amount of such deferral will be reduced, if
necessary, to pay such tax, payroll and other withholding obligations as the Company
shall determine to be necessary or appropriate.
(c) Notwithstanding the foregoing, the Compensation Committee of the Board of
Directors may, at its sole election, at any time and from time to time require that
the payment of the entire, or any portion of the, Unit Value of any number of the
Units earned shall be deferred until the Optional Deferral Date, or such later date
as it shall deem appropriate, in order for the Company to conform to the
requirements of Section 162(m) of the Internal Revenue Code (the “Required Deferral
Amount”). Any Required Deferral Amount so deferred will be credited to an account
maintained in the records of the Company and will be converted into Deferral Units,
the number of which shall be determined by dividing each amount so deferred by the
Fair Market Value of the Common Stock on the date of such deferral.
6. As used herein, the term: (1) “Deferral Unit” means an equivalent to a hypothetical share
of the Common Stock; (2) “Optional Deferral Date” means the first business day of the twelfth month
following the month during which you cease to be employed by the Company, or one of its
Subsidiaries, for any reason (whether Retirement, Disability, death, voluntary termination or
otherwise); (3) “Optional Deferral Unit” means each Deferral Unit resulting from any Optional
Deferred Amount, including Dividend Equivalents credited in respect thereof; and (4) “Required
Deferral Unit” means each Deferral Unit resulting from any Required Deferred Amount, including
Dividend Equivalents credited in respect thereof. All computations relating to Deferral Units,
fractions of shares of Common Stock and Dividend Equivalents will be rounded, if necessary, to the
fourth decimal place.
7. Each Deferral Unit will be credited with one Dividend Equivalent on each date on which
cash dividends are paid on shares of the Common Stock (and each fraction of a Deferral Unit shall
be credited with a like fraction of a Dividend Equivalent). Dividend Equivalents (and fractions
thereof, if any) will be automatically translated into Deferral Units by dividing the dollar amount
of such Dividend Equivalents by the Fair Market Value of the Common Stock on the date the relevant
Dividend Equivalents are accrued to your account. The number of Deferral Units (and any fractions
thereof) resulting will be credited to your account (in lieu of the dollar amount of such Dividend
Equivalent) and shall continually be denominated in Deferral Units until converted for payment as
provided in this Grant Agreement.
8. If you have duly elected to receive payment of all or a specified percentage of your
Deferral Units on the Optional Deferral Date (or if payment of any of the Deferral Units has been
deferred until the Optional Deferral Date pursuant to the conversion thereof into Required Deferral
Units), you may elect, at the time and in the manner specified below, to receive such Deferral
Units in lieu of a lump sum on the fifth business day following the Optional Deferral Date, (1) in
a series of not less than five (5) or more than ten (10) annual installments commencing on the
fifth business day following the Optional Deferral Date, or (2) a specified percentage of your
Deferral Units on the fifth business day following the Optional Deferral Date and the balance of
your Deferral Units in installments as specified in clause (1) of this sentence.
9. On the Optional Deferral Date (to the extent you have not elected to receive payment in
installments), the whole Deferral Units then in your account (which have not been designated for
payment in installments) will be converted at your election (which election shall be made in
writing on or before the last day of the seventh month prior to the month during which the Optional
Deferral Date occurs), into (1) a like number of shares of Common Stock, or (2) a dollar amount
determined by multiplying the number of whole Deferral Units credited to your account by the Fair
Market Value of the Common Stock on the Optional Deferral Date, or (3) a combination of shares of
Common Stock and cash in accordance with your election (which shall be expressed as a percentage of
the Deferral Units to be paid in shares of Common Stock). In accordance with your election, within
five business days following the Optional Deferral Date you will be paid (a) such number of shares
of Common Stock, (b) such amount of cash, or (c) the elected combination of shares of Common Stock
and cash, the amounts of which shall be determined in accordance with the preceding sentence.
If you did not make an election as to the form of payment on or before the required date, you will
receive payment in shares of Common Stock. Any fraction of a Deferral Unit will be paid to you on
the relevant date in cash, the amount of which shall be calculated in the manner specified above.
10. If you desire to receive payment of your Deferral Units or a portion thereof in annual
installments, you may elect (by delivering to the Company a written notice of your election, which
shall specify the number of annual installments, not later
June 30, 20___ to receive all, or a
specified whole percentage of, the Deferral Units in your account (which would otherwise be
scheduled for distribution on the Optional Deferral Date) in not less than five (5) or more than
ten (10) annual installments, payable commencing on the fifth business day following the Optional
Deferral Date and thereafter on the fifth business day following each anniversary thereof until
paid in full. You may also elect (in writing on or before the last day of the seventh month prior
to the month during which the Optional Deferral Date occurs) to receive payment in shares of Common
Stock, cash or any combination of Common Stock and cash (expressed as a percentage of the Deferral
Units to be paid in shares of Common Stock. Each installment shall be in an amount equal to the
total number of Deferral Units credited to your account on the Optional Deferral Date, or on the
anniversary thereof which is the fifth business day prior to the date such installment is due and
payable, as the case may be, divided by the number of annual installments remaining (including the
annual installment then being calculated for payment) to be paid. In respect of each installment,
the number of Deferral Units payable shall, in accordance with your election, be converted into (1)
a like number of shares of Common Stock, (2) a dollar amount determined by multiplying the number
of whole Deferral Units credited to your account by the Fair Market Value of the Common Stock on
the relevant anniversary of the Optional Deferral Date (or the Optional Deferral Date in the case
of the first installment), or
(3) the elected combination of shares of Common Stock and cash, the
amounts of which shall be determined in the manner specified above. Any fraction of Deferral Unit
will be paid to you on the relevant date in cash, the amount of which shall be calculated in the
manner specified above.
11. You will be required to satisfy all Federal, state and local tax and payroll withholding
obligations, and any other withholding obligations, arising in respect of any distribution of
shares of Common Stock or cash to you. To the extent there is sufficient cash available, such
withholding obligations will be deducted from your distribution. To the extent the amount of cash
to be distributed is not sufficient to satisfy all withholding obligations, you may elect in
writing on or before the last day of the seventh month prior to the month during which the Optional
Deferral Date occurs to pay such withholding obligations as a condition of your receipt of any
distribution of shares of Common Stock or to have the number of shares of Common Stock reduced by
the number of shares equivalent to the required tax withholding obligation based on the Fair Market
Value of the Common Stock on the relevant anniversary of the Optional Deferral Date if payment is
in installments or on the Optional Deferral Date in the case of the first installment or payment in
the form of a lump sum.
12. In the event of your death at any time prior to the Optional Deferral Date, your account
balance will be paid in cash in a lump sum on the fifth business day following the Optional
Deferral Date. In the event of your death at any time following the Optional Deferral Date and
prior to the distribution of your account, the entire balance of your account shall be paid in cash
on the anniversary of the Optional Deferral Date next following your date of death.
13. Any notice to you under this Grant Agreement shall be sufficient if in writing and if
delivered to you or mailed to you at the address on record in the Executive Compensation
Department. Any notice to the Company under this Grant Agreement shall be sufficient if in writing
and if delivered to the Executive Compensation Department of the Company in Akron, Ohio, or mailed
by registered mail directed to the Company for the attention of the Executive Compensation
Department at 0000 Xxxx Xxxxxx Xxxxxx, Xxxxx, Xxxx 00000-0000. Either you or the Company may, by
written notice, change the address. This Grant Agreement shall be construed and shall take effect
in accordance with the laws of the State of Ohio.
