8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): February 22, 2005

The Goodyear Tire & Rubber Company
__________________________________________
(Exact name of registrant as specified in its charter)

Ohio	1-1927	34-0253240
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
1144 East Market Street, Akron, Ohio		44316-0001
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 330-796-2121

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement.

On February 22, 2005, The Compensation Committee (the "Committee") of the Board of Directors of The Goodyear Tire & Rubber Company (the "Company") took the following actions with respect to the compensation of the Company’s named executive officers (as defined in Item 402(a)(3) of Regulation S-K):

1. Established salary compensation effective May 1, 2005 for the following named executive officers: Jonathan D. Rich, President, North American Tire, $445,200; C. Thomas Harvie, Senior Vice President, General Counsel and Secretary, $446,100; Richard J. Kramer, Executive Vice President and Chief Financial Officer $461,100; and Michael J. Roney, President, European Tire Union $418,100. The Committee, at its December 9, 2004 meeting, previously established the salary compensation effective May 1, 2005, for Robert J. Keegan, Chairman of the Board, Chief Executive Officer and President at $1,100,000.

2. Approved earnings before interest and taxes less finance charges ("EBIT") and operating cash fl ow as the financial performance measures under the Performance Recognition Plan for fiscal year 2005. Payment of 2005 bonuses will be made from a payment pool, the size of which will depend on the extent to which the specific financial performance targets established by the Committee are met. The target aggregate payment pool for 2005 is $26.3 million. Funding of the 2005 payment pool will be based 50% on each performance measure and could range from zero to 200% of the target amount depending on the level of operating cash flow and EBIT achieved. In addition, payouts for the named officers may be adjusted based on individual performance. At its December 9, 2004, meeting, the Committee approved target bonuses for 2005 under the Performance Recognition Plan for the named executive officers as follows: Mr. Keegan, $1,500,000; Mr. Rich, $385,000; Mr. Harvie, $290,000; Mr. Kramer, $330,000; and Mr. Roney $361,000.

3. Approved annual cash bonus awards earned during 2004 and to be paid in 2005 under t he Company’s Performance Recognition Plan for 2004. As described above with respect to fiscal year 2005, the financial performance measures applicable to the 2004 awards were earnings before interest and taxes less finance charges and operating cash flow. The bonus awards were earned based upon the achievement of specific financial targets established in February 2004, which were reviewed and approved by the Compensation Committee. As a result of the level of targets achieved, the Committee approved funding the 2004 payment pool at approximately 189%. The bonus awards for the named executive officers are: Mr. Keegan, $2,600,000; Mr. Rich, $680,000; Mr. Harvie, $560,000; Mr. Kramer, $587,704; and Mr. Roney, $570,000.

4. Approved net income and total cash flow as the financial performance measures applicable to grants made to the named executive officers under the Company’s Executive Performance Plan (the "EP Plan"). The Committee, on December 9, 2004, awarded the following grants un der the EP Plan: Mr. Keegan, 44,000 units; Mr. Rich, 11,000 units; Mr. Harvie, 8,300 units; Mr. Kramer, 10,700 units; and Mr. Roney, 10,000 units. Units will be paid in cash, with payment ranging between $0 and $200 per unit, depending upon the attainment of specific cumulative target levels of net income and cash flow over a three-year performance period ending December 31, 2007. A copy of the EP Plan Grant Agreement is attached as Exhibit 10.1 to this Report and is incorporated by reference herein.

The Company intends to provide additional information regarding the compensation awarded to the named executive officers in respect of and during the year ended December 31, 2004, in the proxy statement for the Company’s 2005 annual meeting of shareholders, which is expected to be filed with the Securities and Exchange Commission in March 2005.

Item 9.01. Financial Statements and Exhibits.

Exhibit 10.1. Form of Grant Agreement for the Executive Performance Plan of The Goodyear Tire & Rubber Company.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	The Goodyear Tire & Rubber Company
February 28, 2005	By:	C. Thomas Harvie
		Name: C. Thomas Harvie
		Title: Senior Vice President, General Counsel and Secretary

Exhibit Index

Exhibit No.	Description
10.1	Form of Executive Performance Plan Grant Agreement

EX-10.1

THE GOODYEAR TIRE & RUBBER COMPANY

GRANT AGREEMENT

EXECUTIVE PERFORMANCE PLAN UNIT GRANT

Name
Title

The Executive Performance Plan of The Goodyear Tire & Rubber Company (the “Company”) was adopted effective January 1, 2004 by the Board of Directors at their meeting on December 2, 2003 (the “Plan”). A copy of the Plan is attached. At the            meeting of the Compensation Committee of the Board of Directors (the “Committee”), you were awarded an Executive Performance Plan Unit Grant (the “Units”) as follows:

Date of Grant:

Number of Units Granted:

Performance Period:	1-1-[ ] to 12-31-[ ]
Unit Value	$0 to $200

The value of the Executive Performance Plan Units specified above (the “Unit Value”) which you will earn at the end of the three-year Performance Period specified above (the “Performance Period”) will be determined and contingent upon the extent to which Performance Goals are achieved. The Unit Value may be adjusted from $0 up to $200, depending on the level of achievement of Performance Goals. Payment of the Units will be made as provided under the General Terms and Conditions. The Performance Measures, Performance Goals and Unit Value schedule for the Performance Period for your Executive Performance Plan Unit Grant are described in Annex A.

The Goodyear Tire & Rubber Company

Grant Agreement received and agreed to:

     
Name      
Date

GRANT AGREEMENT
(Continued)

General Terms and Conditions

1. The Executive Performance Plan Unit Grant for the number of Units specified above is granted to you under, and governed by the terms and conditions of, the Plan and this Grant Agreement. Your execution and return of the enclosed copy of this Grant Agreement 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.

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. The number of Units Granted will be multiplied by the Unit Value to determine the dollar amount of the Performance Award (the “Performance Award”) to be paid after the end of the Performance Period at such time or times as the Compensation Committee, in its sole discretion, shall determine. All awards will be paid in cash.

4. 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. The number of units granted will be prorated in the event of your death or Retirement (defined as termination of employment at any age after 30 or more years of service with the Company and its subsidiaries, or at age 55 or older with at least 10 years of continuous service with the Company and its subsidiaries) prior to completion of the Performance Period. Pro-rata units are calculated by dividing the number of months worked by the number of months in the Performance Period (36) and multiplying the result by the number of Units Granted. For purposes of the pro-rata unit calculation, if any portion of a month is worked, credit will be provided for the full month. The Performance Award will be determined by multiplying the prorated number of Units Granted by the Unit Value for the Performance Period and paid after the end of the Performance Period at such time or times as the Compensation Committee, in its sole discretion, shall determine. The Performance Award will be paid in cash. 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.

Page 2 of 3

GRANT AGREEMENT
(Continued)

5. In the event your employment status changes during the Performance Period due to layoff, leave of absence or disability, the number of units granted will be prorated. Pro-rata units are calculated by dividing the number of months worked by the number of months in the Performance Period (36) and multiplying the result by the number of Units Granted. For purposes of the pro-rata unit calculation, if any portion of a month is worked, credit will be provided for the full month. The Performance Award will be determined by multiplying the prorated number of Units Granted by the Unit Value for the Performance Period and paid after the end of the Performance Period at such time or times as the Compensation Committee, in its sole discretion, shall determine. The Performance Award will be paid in cash.

6. You will be required to satisfy all federal, state and local tax and payroll withholding obligations arising in respect of any distribution of cash to you. Such withholding obligations will be deducted from your distribution.

7. Upon proper election, you may elect to defer receipt of your Performance Award in which case such amount will be credited to an account under The Goodyear Tire & Rubber Company Deferred Compensation Plan for Executives.

8. The Committee 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 Performance Award be deferred until such later date as it shall deem appropriate. Any required deferral amount will be credited to an account under The Goodyear Tire & Rubber Company Deferred Compensation Plan for Executives.

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

Page 3 of 3

PAYOUT SCALE

			Net Income (50%)
200[ ] 200[ ] 200[		] Cumulative		Unit Value
					$	200
					$	150
					$	100
					$	0-$99
			Total Cash Flow (50%)
200[ ]	200[ ]	200[ ]	Cumulative		Unit Value
					$	200
					$	150
					$	100
					$	0-$99