GOVERNANCE AGREEMENT
dated as of
December 19, 2000
among
LXH, L.L.C.,
LXH II, L.L.C.,
Hexcel Corporation
and
The Other Parties Listed
on the Signature Pages Hereto
GOVERNANCE AGREEMENT dated as of December 19, 2000, among LXH,
L.L.C., a Delaware limited liability company ("LXH"), LXH II, L.L.C., a
Delaware limited liability company ("LXH II"), HEXCEL CORPORATION, a
Delaware corporation ("Hexcel"), and the other parties listed on the
signature pages hereto (the "Limited Partnerships").
WHEREAS, LXH, LXH II, Ciba Specialty Chemicals Holding Inc., Ciba
Specialty Chemicals Inc. and Ciba Specialty Chemicals Corporation are
parties to a Stock Purchase Agreement dated as of October 11, 2000 (the
"Purchase Agreement"), and have consummated the transactions contemplated
therein (the "Transactions"), whereby the Investors (as such term is
defined below) now Beneficially Own approximately 39.3% of the Total Voting
Power of Hexcel (as such terms are defined below); and
WHEREAS the parties hereto wish to further establish the nature of
their relationship and set forth their agreement concerning the governance
of Hexcel following consummation of the Transactions as well as certain
matters relating to the Investors' ownership of Voting Securities (as such
term is defined below).
NOW, THEREFORE, in consideration of the mutual covenants and
undertakings contained herein and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties
hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINITIONS. As used in this Agreement, the following
terms shall have the following meanings:
"ADDITIONAL SHARES" means, as of any date of determination, up to
255,381 shares of Hexcel Common Stock (as equitably adjusted to reflect any
stock split, combination, reorganization, recapitalization,
reclassification or other similar event involving the Hexcel Common Stock),
in the aggregate, (i) the Beneficial Ownership of which may be acquired
inadvertently from time to time by The Xxxxxxx Xxxxx Group, Inc. or its
Affiliates acting in connection with their activities as a broker or dealer
registered under Section 15 of the Exchange Act or as an asset manager
(excluding Affiliates formed for the purpose of effecting principal
transactions) or (ii) the Beneficial Ownership of which may be acquired by
the Investors pursuant to grants of stock options or other stock-based
awards to the Investors' Directors by Hexcel pursuant to any stock option
or stock incentive plan approved by the Board of Directors of Hexcel,
including without limitation the Hexcel Incentive Stock Plan; provided,
that if and for so long as The Xxxxxxx Sachs Group, Inc. and its Affiliates
collectively Beneficially Own less than 30% of the Total Voting Power of
Hexcel, the maximum number of Additional Shares shall be 400,000 (as
equitably adjusted to reflect any stock split, combination, reorganization,
recapitalization, reclassification or other similar event involving the
Hexcel Common Stock).
An "AFFILIATE" of any Person means any other Person that directly
or indirectly, through one or more intermediaries, Controls, is Controlled
by, or is under common Control with, such first Person. "CONTROL" has the
meaning specified in Rule 12b-2 under the Exchange Act as in effect on the
date of this Agreement.
Any Person shall be deemed to "BENEFICIALLY OWN", to have
"BENEFICIAL OWNERSHIP" of, or to be "BENEFICIALLY OWNING" any securities
(which securities shall also be deemed "BENEFICIALLY OWNED" by such Person)
that such Person is deemed to "beneficially own" within the meaning of Rule
13d-3 and 13d-5 under the Exchange Act as in effect on the date of this
Agreement; provided that, except for the rights set forth in Section 3.02
hereof, any Person shall be deemed to Beneficially Own any securities that
such Person has the right to acquire, whether or not such right is
exercisable immediately.
"BOARD" means the board of directors of Hexcel.
"BROAD DISTRIBUTION" with respect to Voting Securities, means a
distribution of Voting Securities that, to the knowledge, after due
inquiry, of the Person on whose behalf such distribution is being made,
will not result in the acquisition by any other Person of Beneficial
Ownership of any such Voting Securities to the extent that, after giving
effect to such acquisition, such acquiring Person (other than any Investor
and other than any underwriter acting in such capacity in an underwritten
public offering of Hexcel Common Stock) would Beneficially Own in excess of
5% of the Total Voting Power of Hexcel.
"BUYOUT TRANSACTION" means a tender offer, merger or any similar
transaction that offers holders of Voting Securities (other than, if
applicable, the Person proposing such transaction) the opportunity to
dispose of the Voting Securities Beneficially Owned by such holders or
otherwise contemplates the acquisition by any Person or Group of Voting
Securities that would result in Beneficial Ownership by such Person or
Group of a majority of the Voting Securities outstanding, or a sale of all
or substantially all of Hexcel's assets.
"CHAIRMAN" means the Chairman of the Board and Chief Executive
Officer of Hexcel.
"CLOSING DATE" means the date of the closing of the Transactions.
"CUSTOMARY ACQUISITION/CONTROL PREMIUM" means the
aggregate realizable value for all Voting Securities (including Voting
Securities owned by the Investors), assuming a sale of Hexcel in its
entirety in a transaction or series of related transactions to a third
party or parties on an arm's length basis in a controlled auction process
designed to maximize shareholder value by attracting all possible bidders,
including the Investors and their Affiliates.
"DEBT INSTRUMENTS" shall mean (i) Hexcel's Second Amended and
Restated Credit Agreement, dated as of September 15, 1998, as amended from
time to time, or any replacement thereof and (ii) the Indenture, dated as
of January 21, 1999, relating to Hexcel's 9-3/4% Senior Subordinated Notes
Due 2009.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"GOVERNMENTAL ENTITY" means any court, administrative agency,
regulatory body, commission or other governmental authority, board, bureau
or instrumentality, domestic or foreign and any subdivision thereof.
"GROUP" has the meaning set forth in Section 13(d) of the Exchange
Act as in effect on the date of this Agreement.
"GS CAPITAL" shall mean GS Capital Partners 2000 L.P., a Delaware
limited partnership.
"HEXCEL" has the meaning set forth in the recitals to this
Agreement.
"HEXCEL COMMON STOCK" means the common stock of Hexcel, par value
$0.01 per share, and any equity securities issued or issuable in exchange
for or with respect to the Common Stock by way of a stock dividend, stock
split or combination of shares or in connection with a reclassification,
recapitalization, merger, consolidation or other reorganization.
"HEXCEL INCENTIVE STOCK PLAN" means the Hexcel Corporation
Incentive Stock Plan, as amended and restated as of February 3, 2000 and
any subsequent amendment thereto approved by the Board of Directors of
Hexcel.
"HEXCEL OPTION PERIOD" means the 6 month period following the first
anniversary of the Closing Date.
"INDEMNIFIED INDIVIDUALS" means each of the individuals who at any
time were officers and directors of Hexcel and their respective heirs and
personal and legal representatives.
"INDEPENDENT DIRECTOR" means a director of Hexcel who is not an
Investors' Director and who (i) is not and has never been an officer,
employee or director of any of the Investors or their Affiliates or
associates (as defined in Rule 12b-2 under the Exchange Act), in each case
other than Hexcel, and (ii) has no affiliation or compensation, consulting
or contractual relationship with any of the Investors or their Affiliates
or associates (in each case other than Hexcel) such that a reasonable
person would regard such director as likely to be unduly influenced by any
of such Persons or any of their Affiliates or associates (in each case
other than Hexcel).
"INITIAL INVESTORS' SHARES" means the 14,525,000 shares of Hexcel
Common Stock initially sold by Ciba Specialty Chemicals Inc. and Ciba
Specialty Chemicals Corporation pursuant to the Purchase Agreement (as
equitably adjusted to reflect any stock split, combination, reorganization,
recapitalization, reclassification or other similar event involving the
Initial Investors' shares).
"INVESTOR BUYOUT TRANSACTION" means a Buyout Transaction by the
Investors or their Affiliates or any other Person acting on behalf of the
Investors or their Affiliates, or any Person who is part of a Group with
the Investors, involving the acquisition of all (but not less than all)
Voting Securities held by the Other Holders, provided that all Other
Holders are entitled to receive Requisite Consideration upon consummation
of such Buyout Transaction.
"INVESTORS" means (i) LXH, (ii) LXH II, (iii) each of the Limited
Partnerships, (iv) The Xxxxxxx Xxxxx Group, Inc., or any direct or indirect
Subsidiary of The Xxxxxxx Sachs Group, Inc. formed for the purpose of
effecting principal transactions, and (v) subject to the approval of a
majority of the Independent Directors, one other Person designated within
90 days following the Closing Date by LXH or LXH II as a proposed
transferee of up to 2,200,000 shares of Hexcel Common Stock; provided, that
any of the foregoing Persons shall be an Investor only for so long as it
Beneficially Owns Voting Securities subject to the provisions of this
Agreement or is a transferee of Voting Securities pursuant to Section
4.01(a)(i); provided, further, that any such Person specified in clause
(iv) or (v) that acquires Voting Securities in accordance with this
Agreement shall execute a joinder in which it shall agree to be bound by
the provisions of this Agreement to the same extent as the Investors and
shall thereafter be deemed to be an "Investor" for all purposes of this
Agreement.
"INVESTORS' DIRECTORS" means Investors' Nominees who are elected or
appointed to serve as members of the Board in accordance with this
Agreement.
"INVESTORS' NOMINEES" means such Persons as are so designated by GS
Capital or LXH II, as such designations may change from time to time in
accordance with this Agreement, to serve as members of the Board pursuant
to Section 2.03 hereof.
"ORDINARY COURSE BROKER DEALER SHARES" means those shares of Hexcel
Common Stock which are acquired by any Person solely in connection with the
activities of a broker or dealer registered under Section 15 of the
Exchange Act (i) as a result of underwriting activities in connection with
a registration statement filed by Hexcel (including any shares acquired for
the investment account of a broker or dealer in connection with such
underwriting activities), (ii) as a result of the exercise of investment or
voting discretion authority with respect to any of such Person's customer
accounts, or (iii) in good faith in connection with a debt previously
contracted; provided, in each case, that the Person engaging in such
activities does not Beneficially Own such shares of Hexcel Common Stock.
"OTHER HOLDERS" means the holders of the Other Shares.
"OTHER SHARES" means Voting Securities not Beneficially Owned by
the Investors.
"PERSON" means any individual, Group, corporation, firm,
partnership, joint venture, trust, business association, organization,
Governmental Entity or other entity.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement dated as of the date hereof between LXH, LXH II and Hexcel.
"REQUISITE CONSIDERATION" means consideration that is (i) approved
by (x) a majority of the Independent Directors acting solely in the
interests of the Other Holders, after the receipt of an opinion of an
independent nationally recognized investment banking firm retained by them
or (y) a majority in interest of the Other Holders by means of a
Stockholder Vote solicited pursuant to a proxy statement containing the
information required by Schedule 14A under the Exchange Act (it being
understood that the Independent Directors shall, consistent with their
fiduciary duties, be free to include in such proxy statement, if
applicable, the reasons underlying any failure by them to approve a Buyout
Transaction by the requisite vote, including whether a fairness opinion was
sought by the Independent Directors and any opinions or recommendations
expressed in connection therewith) and (ii) in the opinion of an
independent nationally recognized investment banking firm (including such a
firm retained by the Investor), fair to the Other Holders from a financial
point of view. In connection with the retention of any investment banking
firm referred to herein, the Independent Directors shall instruct such
investment banking firm, unless the Independent Directors conclude, after
consultation with their outside legal and financial advisors, that such
instructions are not appropriate, to (a) value Hexcel's businesses taking
into account a premium for control and (b) assume for purposes of such
opinion that the Other Holders are entitled to their proportionate part of
a Customary Acquisition/Control Premium.
"SEC" means the Securities and Exchange Commission or any successor
Governmental Entity.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"SIGNIFICANT SUBSIDIARY" has the meaning set forth in Rule 1-02 of
Regulation S-X under the Securities Act as in effect on the date of this
Agreement.
"STANDSTILL PERIOD" means the three-year period commencing on the
Closing Date.
"STOCKHOLDER VOTE" means as to any matter to be presented to
holders of Voting Securities, a vote at a duly called and held annual or
special meeting of the holders of Voting Securities entitled to vote on
such matter.
"SUBSIDIARY" means, with respect to any Person, as of any date of
determination, any other Person as to which such Person owns, directly or
indirectly, or otherwise controls, more than 50% of the voting shares or
other similar interests.
"THIRD PARTY OFFER" means a bona fide offer to enter into a Buyout
Transaction by a Person other than the Investors or any of their
Affiliates, any other Person acting on behalf of the Investors or any of
their Affiliates, or any Person who is part of a Group with the Investors
or any of their Affiliates, that does not treat the Investors or their
Affiliates differently than the Other Holders.
"TOTAL VOTING POWER OF HEXCEL" means the total number of votes that
may be cast in the election of directors of Hexcel if all Voting Securities
outstanding or treated as outstanding pursuant to the final sentence of
this definition were present and voted at a meeting held for such purpose.
The percentage of the Total Voting Power of Hexcel Beneficially Owned by
any Person is the percentage of the Total Voting Power of Hexcel that is
represented by the total number of votes that may be cast in the election
of directors of Hexcel by Voting Securities Beneficially Owned by such
Person. In calculating such percentage, the Voting Securities Beneficially
Owned by any Person that are not outstanding but are subject to issuance
upon exercise or exchange of rights of conversion or any options, warrants
or other rights Beneficially Owned by such Person shall be deemed to be
outstanding for the purpose of computing the percentage of the Total Voting
Power represented by Voting Securities Beneficially Owned by such Person,
but shall not be deemed to be outstanding for the purpose of computing the
percentage of the Total Voting Power represented by Voting Securities
Beneficially Owned by any other Person.
"TRANSACTIONS" has the meaning set forth in the recitals to this
Agreement.
"VOTING SECURITIES" means Hexcel Common Stock and any other
securities of Hexcel or any Subsidiary of Hexcel entitled to vote generally
in the election of directors of Hexcel or such Subsidiary of Hexcel.
ARTICLE II
CORPORATE GOVERNANCE
SECTION 2.01 BOARD OF DIRECTORS. The Board shall consist of ten
members, one of whom shall be the Chairman.
SECTION 2.02 INVESTORS BOARD REPRESENTATION. (a) Subject to Section
2.05(c), for so long as the Investors Beneficially Own 20% or more of the
Total Voting Power of Hexcel, the parties hereto shall exercise all
authority under applicable law to cause any slate of directors presented to
stockholders for election to the Board to consist of such nominees that, if
elected, would result in the Board consisting of three Investors'
Directors, the Chairman and six additional Independent Directors; provided,
however, that if the Investors, directly or indirectly, during the term of
this Agreement shall have sold, transferred or otherwise disposed of, on a
cumulative basis, Beneficial Ownership of such number of shares of Hexcel
Common Stock representing 33 1/3% or more of the Initial Investors' Shares
to Persons that are not Investors, then the parties hereto shall exercise
all authority under applicable law to cause any slate of directors
presented to stockholders for election to the Board to consist of such
nominees that, if elected, would result in the Board consisting of two
Investors' Directors, the Chairman and seven additional Independent
Directors.
(b) Subject to Section 2.05(c), for so long as the Investors
Beneficially Own less than 20% but at least 15% of the Total Voting Power
of Hexcel, the parties hereto shall exercise all authority under applicable
law to cause any slate of directors presented to stockholders for election
to the Board to consist of such nominees that, if elected, would result in
the Board consisting of two Investors' Directors, the Chairman and seven
additional Independent Directors; provided, however, that if the Investors,
directly or indirectly, during the term of this Agreement shall have sold,
transferred or otherwise disposed of, on a cumulative basis, Beneficial
Ownership of such number of shares of Hexcel Common Stock representing
66 2/3% or more of the Initial Investors' Shares to Persons that are not
Investors, then the parties hereto shall exercise all authority under
applicable law to cause any slate of directors presented to stockholders
for election to the Board to consist of such nominees that, if elected,
would result in the Board consisting of one Investors' Director, the
Chairman and eight additional Independent Directors.
(c) Subject to Section 2.05(c), for so long as the Investors
Beneficially Own less than 15% but at least 10% of the Total Voting Power
of Hexcel, the parties hereto shall exercise all authority under applicable
law to cause any slate of directors presented to stockholders for election
to the Board to consist of such nominees that, if elected, would result in
the Board consisting of one Investors' Director, the Chairman and eight
additional Independent Directors.
(d) In order to determine (x) the number of Investors' Nominees to
be included in any slate of directors to be presented to stockholders for
election to the Board and (y) the percentage of the Total Voting Power of
Hexcel Beneficially Owned by the Investors for purposes of Section 2.06,
the Investors shall be deemed to Beneficially Own a percentage of the Total
Voting Power of Hexcel that is no more than (1) 39.3% of the Total Voting
Power of Hexcel less (2) the percentage of the Total Voting Power of Hexcel
represented by any Voting Securities disposed of, directly or indirectly,
by the Investors to Persons that are not Investors since the Closing Date.
(e) The Additional Shares shall not be included in any calculation
of the Investors' Beneficial Ownership of the Total Voting Power of Hexcel
under this Agreement.
SECTION 2.03 DESIGNATION OF SLATE. (a) Any Investors' Nominees that
are included in a slate of directors pursuant to Section 2.02 shall be
designated as provided in this Section 2.03, and any Independent Director
nominees who are to be included in any slate of directors pursuant to
Section 2.02 shall be designated by majority vote by the then incumbent
Independent Directors (including the Chairman if he or she is an
Independent Director). Hexcel's nominating committee, if any (or if there
is no such nominating committee, the Board or any other duly authorized
committee thereof), shall nominate each person so designated. The initial
Investors' Nominees shall be Xxxxxxx Xxxxx (appointed by GS Capital), and
Xxxxx Xxxxxxxxx (appointed by GS Capital) and Xxxxx X. Xxxxxxx (appointed
by LXH II). The initial Chairman shall be Xxxx X. Xxx. Upon consummation of
the Transactions, the number of directors constituting the entire Board
will be fixed at ten and simultaneously herewith a sufficient number of the
then serving members of the Board will resign in order to permit the
appointment of the initial Investors' Nominees to fill the vacancies
thereby created. The remaining members of the Board shall be Xxxxxx X.
Xxxxx, Xxxxxxxx X. Xxxxxx, Xxxxx Xxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxx
and H. Xxxxxx Xxxxxxx, Xx.
(b) The parties hereby agree that for so long as (i) the Investors
are permitted to designate three Investors' Directors pursuant to this
Agreement, two directors shall be designated by GS Capital and one director
shall be designated by LXH II, (ii) the Investors are permitted to
designate two Investors' Directors pursuant to this Agreement, one director
shall be designated by GS Capital and one director shall be designated by
LXH II and (iii) the Investors are permitted to designate one Investors'
Director pursuant to this Agreement, that director shall be designated by
GS Capital.
(c) If, for any reason, all of the Investors' Directors designated
by GS Capital pursuant to Section 2.02 and this Section 2.03 are not
elected to the Board by stockholders, then Hexcel shall exercise all
authority under applicable law to cause any person designated by GS Capital
to be elected to the Board, and during any such absence of membership on
the Board, Hexcel shall, after receiving notice from GS Capital as to the
identity of a representative of GS Capital, (i) permit such representative
to attend all Board meetings (other than meetings solely of the Independent
Directors) and to the extent contemplated by Section 2.04 all committees
thereof as an observer; (ii) provide such representative advance notice of
each such meeting, including such meeting's time and place, at the same
time and in the same manner as such notice is provided to the members of
the Board (or such committee thereof); (iii) provide such representative
with copies of all materials, including notices, minutes and consents,
distributed to the members of the Board (or such committee thereof) at the
same time as such materials are distributed to such Board (or such
committee thereof) and shall permit such representative to have the same
access to information concerning the business and operations of Hexcel as
such representative would have had as an Investors' Director; and (iv) on a
basis consistent with the members of the Board, permit such representative
to discuss the affairs, finances and accounts of Hexcel with, and to make
proposals and furnish advice with respect thereto, the Board, without
voting; provided, in each case, that such representative agrees in writing
to maintain the confidentiality of all materials and information provided
to him pursuant to this Section 2.03(c) and to return to Hexcel all such
materials and information at such time as such representative ceases to act
as a representative pursuant to this Section 2.03(c).
SECTION 2.04 COMMITTEE MEMBERSHIP. So long as the Investors shall
be entitled to designate two or more Investors' Directors for election to
the Board, each committee of the Board, including the finance, audit,
nominating, and compensation committees shall consist of at least one
Investors' Director; provided, however, that if no Investors' Director is
"independent" as defined by the listing standards of the New York Stock
Exchange, then the audit committee of the Board shall consist solely of
Independent Directors.
SECTION 2.05 RESIGNATIONS AND REPLACEMENTS. (a) If at any time a
member of the Board resigns (pursuant to this Section 2.05 or otherwise) or
is removed in accordance with applicable law or Hexcel's by-laws, a new
member shall be designated to replace such member until the next election
of directors. If consistent with Section 2.02 the replacement director is
to be an Investors' Director, the party that designated such Investors'
Director shall designate the replacement Investors' Director. If the former
member was the Chairman, the replacement Chairman shall be the replacement.
Except as set forth in paragraph (c) below, if consistent with Section
2.02, the replacement director is to be an Independent Director (other than
the Chairman), the remaining Independent Directors (including the Chairman
if he or she is an Independent Director) shall designate the replacement
Independent Director.
(b) Subject to paragraph (c) below, if at any time the number of
Investors' Nominees entitled to be nominated to the Board in accordance
with this Agreement in an election of directors presented to stockholders
would decrease, within 10 days thereafter GS Capital and the Investors
shall cause a sufficient number of Investors' Directors to resign from the
Board so that the number of Investors' Directors on the Board after such
resignation(s) equals the number of Investors' Nominees that GS Capital and
the Investors would have been entitled to designate had an election of
directors taken place at such time. GS Capital and the Investors shall also
cause a sufficient number of Investors' Directors to resign from any
relevant committees of the Board so that such committees are comprised in
the manner contemplated by Section 2.04 after giving effect to such
resignations. Any vacancies created by the resignations required by this
Section 2.05(b) shall be filled by Independent Directors.
(c) If at any time the percentage of the Total Voting Power of
Hexcel Beneficially Owned by the Investors decreases as a result of an
issuance of Voting Securities by Hexcel (other than any of the issuances
described in the last sentence of this Section 2.05(c)), the Investors may
notify Hexcel that the Investors intend to acquire a sufficient amount of
additional Voting Securities in accordance with this Agreement necessary to
maintain their then current level of Board representation within 90 days.
In such event, until the end of such period (and thereafter if the
Investors in fact restore their percentage of the Total Voting Power of
Hexcel during such period and provided that the Investors continue to
maintain the requisite level of Beneficial Ownership of Voting Securities
in accordance with Section 2.02) the Board shall continue to have the
number of Investors' Directors that corresponds to the percentage of the
Total Voting Power of Hexcel Beneficially Owned by the Investors prior to
such issuance of Voting Securities by Hexcel. Notwithstanding any provision
herein to the contrary, the provisions of this Section 2.05(c) shall not
apply to any issuance of Voting Securities (x) in connection with the
registered public offering of up to 6,900,000 shares of Hexcel Common Stock
permitted by Section 2.06(iv) of this Agreement, (y) upon conversion of any
convertible securities which are either outstanding on the date hereof or
approved by the Board or a duly authorized committee of the Board after the
date hereof in accordance with Section 2.06 hereof, or (z) pursuant to
employee or director stock option or incentive compensation or similar
plans outstanding as of the date hereof or, subsequent to the date hereof,
approved by the Board or a duly authorized committee of the Board.
SECTION 2.06 APPROVALS. The Board shall not authorize, approve or
ratify any of the following actions without the approval of a majority of
the Investors' Directors for so long as (subject to the provisions of
Section 2.02(d)) the Investors Beneficially Own 15% or more of the Total
Voting Power of Hexcel and, if the Investors' collective percentage
Beneficial Ownership of the Total Voting Power of Hexcel is reduced below
15% by an issuance of Voting Securities by Hexcel, until (x) 10 business
days after Hexcel notifies the Investors in writing of such issuance, and
(y) if the Investors shall have notified Hexcel within 10 business days
after their receipt of a written notification of such issuance that the
Investors, pursuant to the option granted to the Investors by Section 3.02
of this Agreement, intend to acquire a sufficient amount of Voting
Securities within such 90-day period referred to therein, so that the
Investors will collectively Beneficially Own at least 15% of the Total
Voting Power of Hexcel by the end of such 90-day period, subject to Section
2.05(c), during the 90-day period following an issuance of Voting
Securities by Hexcel that causes the Investors to collectively Beneficially
Own less than 15% of the Total Voting Power of Hexcel:
(i) any merger, consolidation, acquisition or other business
combination involving Hexcel or any Subsidiary of Hexcel (other
than a Buyout Transaction) if the value of the consideration to be
paid or received by Hexcel and/or its stockholders in any such
individual transaction or in such transaction when added to the
aggregate value of the consideration paid or received by Hexcel
and/or its stockholders in all other such transactions approved by
the Board during the immediately preceding 12 months exceeds the
greater of (x) $150 million or (y) 11% of Hexcel's total
consolidated assets;
(ii) any Buyout Transaction; provided, however, that the
Investors' Directors approval rights pursuant to this clause (ii)
shall apply only for the 18 month period following the Closing
Date;
(iii) any sale, transfer, assignment, conveyance, lease or
other disposition or any series of related dispositions of any
assets, business or operations of Hexcel or any of its Subsidiaries
(other than a Buyout Transaction) if the value of the assets,
business or operations so disposed during the immediately preceding
12 months exceeds the greater of (x) $150 million or (y) 11% of
Hexcel's total consolidated assets;
(iv) any issuance by Hexcel or any Significant Subsidiary of
Hexcel of equity or equity-related securities (other than (1)
pursuant to customary employee or director stock option or
incentive compensation or similar plans approved by the Board or a
duly authorized committee of the Board, (2) pursuant to
transactions solely among Hexcel and its wholly owned Subsidiaries
(including any Subsidiaries which would be wholly owned by Hexcel
but for the issuance of directors' or shareholders' qualifying
shares), (3) upon conversion of convertible securities or upon
exercise of warrants or options, which convertible securities,
warrants or options are either outstanding on the date of this
Agreement or approved by the Board or a duly authorized committee
of the Board after the date of this Agreement in accordance with
this Section 2.06, or (4) in connection with any mergers,
consolidations, acquisitions or other business combinations
involving Hexcel or any Subsidiary of Hexcel which are approved by
the Board or a duly authorized committee of the Board in accordance
with this Section 2.06 (if applicable)) for which the consideration
received by Hexcel for such transactions during the immediately
preceding 12 months exceeds the greater of (x) $150 million or (y)
11% of Hexcel's total consolidated assets; provided, however, that
during the 12 month period following the Closing Date, neither
Hexcel nor any Subsidiary of Hexcel may issue shares of Hexcel
Common Stock in a registered public offering under the Securities
Act, in a private placement or otherwise without the approval of a
majority of the Investors' Directors unless the aggregate number of
shares issued during this 12 month period does not exceed 6,900,000
and the offering price of such shares is unanimously approved by a
pricing committee of the Board, such committee consisting solely of
one Investors' Director, the Chairman and one additional
Independent Director (selected by the Independent Directors).
SECTION 2.07 SOLICITATION AND VOTING OF SHARES. (a) Hexcel shall
use commercially reasonable efforts to solicit from the stockholders of
Hexcel eligible to vote for the election of directors proxies in favor of
the Board nominees selected in accordance with Section 2.02.
(b) In any election of directors or at any meeting of the
stockholders of Hexcel called expressly for the removal of directors, for
so long as the Board includes (and will include after any such removal) the
Investors' Directors contemplated by Section 2.02, the Investors shall be
present for purposes of establishing a quorum and shall vote all their
Voting Securities entitled to vote (1) in favor of any nominee or director
selected in accordance with Section 2.02 and (2) against the removal of any
director designated in accordance with Section 2.02. Except as provided
above and in Section 3.03, the Investors shall be free to vote in their
sole discretion all their Voting Securities entitled to vote on any other
matter submitted to or acted upon by stockholders; provided, however, that
the Investors shall vote against any amendment to Hexcel's certificate of
incorporation with respect to the directors' and officers' indemnification
provisions contained therein which would adversely affect the rights
thereunder of the Indemnified Individuals at any time prior to such vote,
except for such modifications as are required by applicable law.
SECTION 2.08 BY-LAWS; RESTRICTIONS ON COMPANY ACTION; ANTI-TAKEOVER
MEASURES. (a) Hexcel shall cause the amendment of its by-laws to reflect
the provisions of Article II of this Agreement and such other matters as
the parties may reasonably agree. The form of such amended by-laws is
attached hereto as Exhibit A. Those by-laws reflecting the provisions of
Article II of this Agreement shall not thereafter be amended during the
term of this Agreement except with the Investor's written consent. Hexcel
and the Investors shall each take or cause to be taken all lawful action
necessary to ensure at all times that Hexcel's certificate of incorporation
and by-laws are not at any time inconsistent with the provisions of this
Agreement.
(b) Except as required by applicable law, rule or regulation,
Hexcel shall not approve or recommend to its stockholders any transaction
or approve, recommend or take any other action (other than those expressly
contemplated by this Agreement and other than those that affect the
Investors and each Other Holder or each director at the same time in the
same manner) that would (1) materially adversely discriminate against the
Investors as stockholders of Hexcel or (2) restrict the right of any
Investors' Director to vote on any matter as such director believes
appropriate in light of his or her duties as a director or the manner in
which an Investors' Director may participate in his or her capacity as a
director in deliberations or discussions at meetings of the Board or any
committee thereof, except with respect to (i) entering into contractual or
other business relationships with the Investors or any of their Affiliates
(other than in their capacity as stockholders of Hexcel), (ii) disputes
with the Investors or any of their Affiliates (including disputes under
this Agreement), (iii) interpretation or enforcement of this Agreement or
any other agreement with the Investors or any of their Affiliates or (iv)
any other matter involving an actual or potential conflict of interest due
to such director's relationship with the Investors or any of their
Affiliates. Notwithstanding the foregoing, Hexcel may adopt or implement
any takeover defense measures applicable to the Investors or any of their
Affiliates, including the institution or amendment by Hexcel or any of its
Subsidiaries of any stockholders rights plan or similar plan or device, or
any change of control matters (including provisions in future agreements or
collaborations), provided, that such takeover defense measures shall not
restrict the rights of the Investors to acquire any Voting Securities
pursuant to the provisions of this Agreement.
ARTICLE III
STANDSTILL
SECTION 3.01 STANDSTILL. (a) Except as otherwise expressly provided
in this Agreement (including Section 2.05(c), this Section 3.01, Section
3.02 or Section 3.03) or as specifically approved by a majority of the
Independent Directors (so long as such approval was not obtained by the
Investors in violation of this Agreement), none of the Investors or any of
their Affiliates shall, directly or indirectly, (i) by purchase or
otherwise, Beneficially Own, acquire, agree to acquire or offer to acquire
any Voting Securities or direct or indirect rights or options to acquire
Voting Securities (including any voting trust certificates representing
such securities) other than the Initial Investors' Shares, Ordinary Course
Broker Dealer Shares and, subject to Section 4.01(d), the Additional
Shares, (ii) enter, propose to enter into, solicit or support any merger or
business combination or similar transaction involving Hexcel or any of its
Subsidiaries, or purchase, acquire, propose to purchase or acquire or
solicit or support the purchase or acquisition of any portion of the
business or assets of Hexcel or any of its Subsidiaries (except for
proposals to purchase or acquire a non-material portion of the assets of
Hexcel or any of its Subsidiaries that are not required to be publicly
disclosed), (iii) initiate or propose any securityholder proposal without
the approval of the Board granted in accordance with this Agreement or
make, or in any way participate in, any "solicitation" of "proxies" (as
such terms are used in the proxy rules promulgated by the SEC under the
Exchange Act) to vote, or seek to advise or influence any Person with
respect to the voting of, any Voting Securities or request or take any
action to obtain any list of securityholders for such purposes with respect
to any matter other than those upon which the Investors may vote in their
sole discretion pursuant to Section 2.07 (or, as to such matters, solicit
any Person in a manner that would require the filing of a proxy statement
under Regulation 14A of the Exchange Act), (iv) form, join or in any way
participate in a Group (other than a Group consisting solely of the
Investors) formed for the purpose of acquiring, holding, voting or
disposing of or taking any other action with respect to Voting Securities
that would be required under Section 13(d) of the Exchange Act to file a
Statement on Schedule 13D with respect to such Voting Securities, (v)
deposit any Voting Securities in a voting trust or enter into any voting
agreement or arrangement with respect thereto (other than this Agreement),
(vi) seek representation on the Board (other than as provided in this
Agreement), the removal of any directors from the Board or a change in the
size or composition of the Board, (vii) make any request to amend or waive
any provision of this Section 3.01, which request would require public
disclosure under applicable law, rule or regulation, (viii) disclose any
intent, purpose, plan, arrangement or proposal inconsistent with the
foregoing (including any such intent, purpose, plan, arrangement or
proposal that is conditioned on or would require the waiver, amendment,
nullification or invalidation of any of the foregoing) or take any action
that would require public disclosure of any such intent, purpose, plan,
arrangement or proposal, (ix) take any action challenging the validity or
enforceability of the foregoing or (x) assist, advise, encourage or
negotiate with any Person with respect to, or seek to do, any of the
foregoing.
(b) Nothing in this Section 3.01 shall (i) prohibit or restrict the
Investors from responding to any inquiries from any shareholders of Hexcel
as to the Investors' intention with respect to the voting of any Voting
Securities Beneficially Owned by the Investors so long as such response is
consistent with the terms of this Agreement; (ii) restrict the right of
each Investors' Director on the Board or any committee thereof to vote on
any matter as such individual believes appropriate in light of his or her
duties as a director or committee member or the manner in which an
Investors' Director may participate in his or her capacity as a director in
deliberations or discussions at meetings of the Board or as a member of any
committee thereof; (iii) prohibit the Investors from Beneficially Owning
Voting Securities issued as dividends or distributions in respect of, or
issued upon conversion, exchange or exercise of, securities which the
Investors are permitted to Beneficially Own under this Agreement; (iv)
prohibit any officer, director, employee or agent of the Investors from
purchasing or otherwise acquiring Voting Securities so long as he or she is
not a member of a Group that includes the Investors or is not otherwise
acting on behalf of the Investors; (v) prohibit the Investors from
disclosing in accordance with their obligations (if any) under the federal
securities laws or other applicable law their desire (if any) that Hexcel
become the subject of a Buyout Transaction; or (vi) restrict the ability of
Xxxxxxx, Xxxxx & Co. and its Affiliates who are not Investors, solely as
agent, to engage in brokerage, investment advisory, anti-raid advisory,
merger advisory, financing, asset management, trading, arbitrage and other
similar activities, in each case on behalf of clients, provided in the case
of this clause (vi) that (A) no Person engaged in such activities shall be
acting, directly or indirectly, at the direction of any other Person at
Xxxxxxx, Sachs & Co. or any of its Affiliates which either is formed for
the purpose of effecting principal transactions or has access to
confidential information of Hexcel, and (B) appropriate protective
arrangements prohibiting disclosure of confidential information are put in
place between the Investors and the Persons who are engaging in such
activities.
(c) After the Standstill Period, nothing in this Section 3.01 shall
prohibit or restrict the Investors from proposing, participating in,
supporting or causing the consummation of a Third Party Offer or an
Investor Buyout Transaction, subject to Section 3.03.
(d) Notwithstanding anything to the contrary set forth in this
Section 3.01, if, at any time following the consummation of a bankruptcy
proceeding involving Hexcel, any Person (other than Hexcel) is permitted by
law or the bankruptcy court in which the proceeding is pending to propose a
plan of reorganization for Hexcel, the Investors shall be permitted to
propose a plan of reorganization for Hexcel; provided, that no plan of
reorganization shall be proposed by the Investors prior to the expiration
or termination of the exclusivity period for Hexcel's filing of a plan of
reorganization, as such exclusivity period may be extended from time to
time (it being understood and agreed that the Investors shall not object to
any extension of Hexcel's exclusivity period and shall not initiate or
otherwise support any proceeding to terminate or shorten the length of
Hexcel's exclusivity period).
SECTION 3.02 INVESTORS RIGHT TO MAINTAIN POSITION. Hexcel hereby
grants to the Investors the following irrevocable option:
If, at any time after the Closing Date for so long as the Investors
shall be entitled to designate one or more Investors' Nominees for election
to the Board, Hexcel shall issue for cash any additional Voting Securities
(except for any issuances described in the following sentence), then Hexcel
shall notify the Investors of such issuance and the price and terms
thereof, and the Investors shall have the option, for a period of 45 days
after receipt of such notice, to purchase from Hexcel an Amount (as defined
below) of such Voting Securities for the same consideration per security
and on the same terms as were applicable to such issuance by Hexcel. The
foregoing option shall not apply to any issuance of Voting Securities (x)
in connection with the registered public offering of up to 6,900,000 shares
of Hexcel Common Stock permitted by Section 2.06(iv) of this Agreement, (y)
upon conversion of any convertible securities which are either outstanding
as of the date hereof or approved by the Board or a duly authorized
committee of the Board after the date of this Agreement in accordance with
Section 2.06, or (z) pursuant to employee or director stock option or
incentive compensation or similar plans outstanding as of the date hereof
or, subsequent to the date hereof, approved by the Board or a duly
authorized committee of the Board. An "Amount" shall mean such number of
securities that would allow the Investors to Beneficially Own the same
percentage of the Total Voting Power of Hexcel as the Investors
Beneficially Owned immediately prior to such issuance.
SECTION 3.03 THIRD PARTY OFFERS; INVESTOR BUYOUT TRANSACTIONS.
(a) In the event that Hexcel becomes the subject of (i) a Third
Party Offer or (ii) an Investor Buyout Transaction that is made during the
term of this Agreement and such Third Party Offer or Investor Buyout
Transaction is approved by (x) a majority of the Board and (y) a majority
of the Independent Directors acting solely in the interest of the Other
Holders, the Investors may act at their sole discretion with respect to
such Third Party Offer or Investor Buyout Transaction.
(b) In the event that Hexcel becomes the subject of a Third Party
Offer that is made prior to the third anniversary of the Closing Date and
such Third Party Offer is approved by a majority of the Board but not by a
majority of the Independent Directors acting solely in the interests of the
Other Holders, none of the Investors nor any of their Affiliates (other
than with respect to Ordinary Course Broker Dealer Shares and Additional
Shares) may support such Third Party Offer, vote in favor of such Third
Party Offer or tender or sell their Voting Securities to the Person making
such Third Party Offer.
(c) In the event that Hexcel becomes the subject of a Third Party
Offer or Investor Buyout Transaction that is made after the third
anniversary of the Closing and such Third Party Offer or Investor Buyout
Transaction is approved by a majority of the Board but not by a majority of
the Independent Directors acting solely in the interests of the Other
Holders, the Investors and each of their Affiliates (other than with
respect to Ordinary Course Broker Dealer Shares and Additional Shares) must
vote all of their Voting Securities against such Third Party Offer or
Investor Buyout Transaction in proportion to the votes cast against such
Third Party Offer or Investor Buyout Transaction with respect to Other
Shares and may not tender or sell their Voting Securities to the Person
making such Third Party Offer or Investor Buyout Transaction in a
proportion greater than the tenders or sales made by the Other Holders to
the Person making such Third Party Offer or Investor Buyout Transaction; it
being understood that the Investors may enter into agreements to tender or
sell Voting Securities to any such Person conditioned upon final
determination of the number of Voting Securities permitted to be so
tendered or sold under this Section 3.03 and Section 3.01.
ARTICLE IV
TRANSFER RESTRICTIONS
SECTION 4.01 RESTRICTIONS. (a) Other than sales, transfers, or
other dispositions to the Investors and other than sales, transfers or
other dispositions of the Additional Shares by the Persons holding such
Additional Shares, none of the Investors or their Affiliates, directly or
indirectly, may sell, transfer or otherwise dispose of Beneficial Ownership
of Voting Securities for a period of one year after the Closing Date.
During the period commencing one year from the Closing Date, the Investors,
directly or indirectly, may sell, transfer or otherwise dispose of
Beneficial Ownership of Voting Securities (i) to another Investor (provided
that such Investor is a signatory to this Agreement or has executed, at the
time of such sale, transfer or other disposition, a joinder in which it
shall agree to be bound by the provisions of this Agreement to the same
extent as the Investors signatory hereto), (ii) in accordance with Rule 144
under the Securities Act (including the volume and manner-of-sale
limitations of Rule 144 regardless of whether such limitations are
applicable) and otherwise subject to compliance with the Securities Act,
(iii) in a registered public offering or a non-registered offering subject
to an applicable exemption from the registration requirements of the
Securities Act in a manner calculated to achieve a Broad Distribution, (iv)
in a Third Party Offer if and to the extent permitted under Section 3.03 or
(v) which are Additional Shares.
(b) If, during the Hexcel Option Period, any of the Investors
proposes to sell, transfer or otherwise dispose of Beneficial Ownership of
any Voting Securities in accordance with this Section 4.01 (other than
transfers (i) to another Investor, (ii) in accordance with Rule 144 under
the Securities Act (including the volume and manner-of-sale limitations of
Rule 144 regardless of whether such limitations are applicable), (iii) in a
manner calculated to achieve a Broad Distribution or in a Third Party Offer
if and to the extent otherwise permitted pursuant to the provisions of this
Agreement or (iv) of Additional Shares), the applicable Investor shall
notify Hexcel of such proposed transfer and the price thereof, and Hexcel
shall have the option for a period of 90 days after receipt of such notice,
to purchase or cause its designee to purchase from such party all of such
Voting Securities. If Hexcel or its designee does not exercise its option
prior to the expiration of such 90 day period or if the offer does not
result in a purchase by Hexcel or its designee, then the applicable
Investor shall have 90 days from the earlier of receipt of a notice from
Hexcel, on behalf of itself and any designee, stating its intention not to
exercise its option pursuant to this Section 4.01, or the expiration of the
90 days from the receipt by Hexcel of the original notice, to consummate
the proposed transaction with any other Person solely at a price that is no
less than the price as stated in its notice to Hexcel pursuant to this
Section 4.01, subject to the terms of this Agreement. Upon any downward
change in the price per security of the proposed transfer subsequent to the
receipt by Hexcel of the original notice, the applicable Investor shall
notify Hexcel of such change and Hexcel shall have the option for a period
of 90 days after receipt of such notice, to purchase or cause its designee
to purchase from such Investor such Voting Securities for the same
consideration per security and on the same terms as are stated in such
notice. The closing of any purchase of Voting Securities by Hexcel or its
designee pursuant to this Section 4.01(b) shall take place as soon as
practicable following the delivery by Hexcel of written notice to the
applicable Investor of its intent to exercise the option pursuant to this
Section 4.01(b) or, if later, the expiration of any prohibition referred to
in the proviso to the first sentence of this Section 4.01(b), or at such
other time and place as the parties to the transaction may agree. At such
closing, the applicable Investor shall deliver certificates representing
the Voting Securities to be transferred, duly endorsed for transfer and
accompanied by all requisite stock transfer taxes, if any, and such Voting
Securities shall be free and clear of any liens, claims or encumbrances
(other than restrictions imposed pursuant to applicable federal and state
securities laws) and the applicable Investor shall so represent and warrant
that it is the record and beneficial owner of such Voting Securities.
(c) If Hexcel or its designee does not exercise its option in
accordance with this Section 4.01 or if the offer does not result in a
purchase by Hexcel or its designee, or if any of the Investors proposes to
sell, transfer or otherwise dispose of Beneficial Ownership of any Voting
Securities after the Hexcel Option Period (other than transfers to another
Investor), then, prior to any such transfer, the applicable Investor shall
cause any proposed transferee of Beneficial Ownership of Voting Securities,
that together with their Affiliates, to their knowledge after due inquiry,
would Beneficially Own more than 5% of the then outstanding Voting
Securities upon consummation of the proposed transfer, to agree in writing
with Hexcel, for a period of three years from the consummation of the
proposed transfer, to be bound by provisions substantially equivalent to,
or more favorable to Hexcel than, those contained in (i) Section 2.07(b),
and (ii) Section 3.01(a) of this Agreement, to the same extent that the
Investors would be bound if they Beneficially Owned the Voting Securities
Beneficially Owned by such transferee.
(d) Notwithstanding anything to the contrary in this Agreement,
none of the Investors or their Affiliates may, directly or indirectly,
acquire, sell, transfer or otherwise dispose of Beneficial Ownership of
Voting Securities if such acquisition, sale, transfer or other disposition
would result in a default or acceleration of amounts outstanding under the
Debt Instruments, unless prior to the consummation of such acquisition,
sale, transfer or other disposition, any required consents under the Debt
Instruments to effect such acquisition, sale, transfer or disposition shall
have been obtained.
SECTION 4.02 LEGENDS. (a) Except as set forth in paragraph (b)
below, during the term of this Agreement all certificates representing
Voting Securities Beneficially Owned by the Investors shall bear an
appropriate restrictive legend indicating that such Voting Securities are
subject to restrictions pursuant to this Agreement and that such Voting
Securities were not issued pursuant to a public offering registered
pursuant to the Securities Act.
(b) Upon any transfer or proposed transfer of Beneficial Ownership
by the Investors of any Voting Securities to any Person other than the
Investors that is permitted pursuant to this Agreement, Hexcel shall, upon
receipt of timely notice and such certificates, opinions and other
documentation as shall be reasonably requested by Hexcel, cause
certificates representing such transferred Voting Securities to be issued
not later than the time needed to effect such transfer (x) without any
restrictive legend if upon consummation of such transfer such Voting
Securities are no longer "restricted securities" as defined in Rule 144
under the Securities Act or (y) without any reference to this Agreement
(except with respect to the limitations contained in Section 4.01(c), if
applicable).
SECTION 4.03 EFFECT. Any purported transfer of Voting Securities
that is inconsistent with the provisions of this Article IV shall be null
and void and of no force or effect.
SECTION 4.04 CONTROL OF THE INVESTORS. Each of the Investors (other
than the Investor identified in clause (v) of the definition of the term
"Investors") represents and warrants to Hexcel, for so long as each such
Investor holds Voting Securities pursuant to this Agreement, that it is
Controlled, directly or indirectly, by The Xxxxxxx Xxxxx Group, Inc., and
covenants that during the term of this Agreement, such Investor shall not,
without the prior written consent of Hexcel, take or permit any action
which would result in the direct or indirect transfer of Control of such
Investor from The Xxxxxxx Sachs Group, Inc. to any other Person. On the
date hereof, the Limited Partnerships own all of the membership interests
of LXH and LXH II.
ARTICLE V
TERMINATION
SECTION 5.01 TERM. (a) This Agreement shall automatically terminate
upon the earlier of:
(i) the tenth anniversary of the Closing Date; or
(ii) the occurrence of any event in accordance with this
Agreement which causes the percentage of the Total Voting Power of
Hexcel Beneficially Owned by the Investors to be either (x) less
than 10% or (y) 90% or more.
(b) If any party to this Agreement is in breach of or violates any
material obligation under this Agreement and fails to cure such breach or
violation within 60 days after delivery of written notice from the other
party specifying such breach or violation and requesting its cure, such
other party may terminate its obligations under this Agreement by written
notice to the other parties hereto.
ARTICLE VI
MISCELLANEOUS
SECTION 6.01 NOTICES. All notices, requests and other
communications hereunder shall be in writing (including fax) and shall be
sent, delivered or mailed, addressed, or faxed:
(a) if to Hexcel, to:
Hexcel Corporation
0 Xxxxxxxx Xxxxx
000 Xxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
(T) (000) 000-0000
(F) (000) 000-0000
Attention: Xxx X. Xxxxxxxx, Esq.
with a copy to:
Xxxxxx X. Coco, Esq.
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
0 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(T) (000) 000-0000
(F) (000) 000-0000
(b) if to the Investors, to:
c/o Goldman Sachs Capital Partners 2000, L.P.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(T) (000) 000-0000
(F) (000) 000-0000
Attention: Xx. Xxxxxxx Xxxxx
with a copy to:
Xxxxxx X. Xxxxxxxxx, Esq.
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
(T) (000) 000-0000
(F) (000) 000-0000
Each such notice, request or other communication shall be given (i) by hand
delivery, (ii) by nationally recognized courier service or (iii) by fax,
receipt confirmed. Each such notice, request or communication shall be
effective (A) if delivered by hand or by nationally recognized courier
service, when delivered at the address specified in this Section 6.01 (or
in accordance with the latest unrevoked written direction from such party)
and (B) if given by fax, when such fax is transmitted to the fax number
specified in this Section 6.01 (or in accordance with the latest unrevoked
written direction from such party), and the appropriate confirmation is
received.
SECTION 6.02 INTERPRETATION. The headings contained in this
Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement. Whenever the words
"included", "includes" or "including" are used in this Agreement, they
shall be deemed to be followed by the words "without limitation".
SECTION 6.03 SEVERABILITY. The provisions of this Agreement shall
be deemed severable and the invalidity or unenforceability of any provision
shall not affect the validity or enforceability of the other provisions
hereof. If any provision of this Agreement, or the application thereof to
any person or entity or any circumstance, is found to be invalid or
unenforceable in any jurisdiction, (a) a suitable and equitable provision
shall be substituted therefor in order to carry out, so far as may be valid
and enforceable, the intent and purpose of such invalid or unenforceable
provision and (b) the remainder of this Agreement and the application of
such provision to other Persons or circumstances shall not be affected by
such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision,
or the application thereof, in any other jurisdiction.
SECTION 6.04 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original and all of
which shall, taken together, be considered one and the same agreement, it
being understood that both parties need not sign the same counterpart.
SECTION 6.05 ENTIRE AGREEMENT; NO THIRD PARTY BENEFICIARIES. This
Agreement, together with the Agreement, dated as of October 11, 2000, among
Hexcel, LXH and LXH II, and the Registration Rights Agreement (a)
constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to
the subject matter hereof and (b) is not intended to confer upon any
Person, other than the parties hereto and, solely with respect to the
proviso in Section 2.07(b), the Indemnified Individuals, any rights or
remedies hereunder.
SECTION 6.06 FURTHER ASSURANCES. Each party shall execute, deliver,
acknowledge and file such other documents and take such further actions as
may be reasonably requested from time to time by the other party hereto to
give effect to and carry out the transactions contemplated herein.
SECTION 6.07 GOVERNING LAW; EQUITABLE REMEDIES. This Agreement
shall be governed by and construed in accordance with the laws of the State
of Delaware, regardless of the laws that might otherwise govern under
applicable principles of conflicts of law. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms
or were otherwise breached. It is accordingly agreed that the parties
hereto shall be entitled to equitable relief, including in the form of
injunctions, in order to enforce specifically the provisions of this
Agreement, in addition to any other remedy to which they are entitled at
law or in equity.
SECTION 6.08 CONSENT TO JURISDICTION. Each party hereto irrevocably
submits to the exclusive jurisdiction of the United States District Court
for the Southern District of New York located in the borough of Manhattan
in the City of New York, or if such court does not have jurisdiction, the
Supreme Court of the State of New York, New York County, for the purposes
of any suit, action or other proceeding arising out of this Agreement or
any transaction contemplated hereby. Each party hereto further agrees that
service of any process, summons, notice or document by U.S. registered mail
to such party's respective address set forth in Section 6.01 shall be
effective service of process for any action, suit or proceeding in New York
with respect to any matters to which it has submitted to jurisdiction as
set forth above in the immediately preceding sentence. Each party hereto
irrevocably and unconditionally waives any objection to the laying of venue
of any action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby in (a) the United States District Court
for the Southern District of New York or (b) the Supreme Court of the State
of New York, New York County, and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been
brought in an inconvenient forum.
SECTION 6.09 AMENDMENTS; WAIVERS. (a) No provision of this
Agreement may be amended or waived unless such amendment or waiver is in
writing and signed, in the case of an amendment, by the parties hereto, or
in the case of a waiver, by the party against whom the waiver is to be
effective; provided that no such amendment or waiver by Hexcel shall be
effective without the approval of a majority of the Independent Directors.
Notwithstanding any provision herein to the contrary, if a majority of the
Independent Directors determine in good faith to do so, such Independent
Directors may seek to enforce, in the name and on behalf of Hexcel, the
terms of this Agreement against the Investors.
(b) No failure or delay by any party in exercising any right, power
or privilege hereunder shall operate as waiver thereof nor shall any single
or partial exercise thereof preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
SECTION 6.10 ASSIGNMENT. Neither this Agreement nor any of the
rights or obligations hereunder shall be assigned by any of the parties
hereto without the prior written consent of the other parties. Subject to
the preceding sentence, this Agreement will be binding upon, inure to the
benefit of and be enforceable by the parties and their respective
successors and assigns.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed and delivered, all as of the date first set forth above.
GS CAPITAL PARTNERS 2000 L.P.
By: /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GS CAPITAL PARTNERS 2000 OFFSHORE, L.P.
By: /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GS CAPITAL PARTNERS 2000 EMPLOYEE FUND, L.P.
By: /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GS CAPITAL PARTNERS 2000 GMBH & CO.
BETEILIGUNGS KG
By: /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: Managing Director
STONE STREET FUND 2000, L.P.
By: /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
LXH, L.L.C.
By: GS Capital Partners 2000, L.P.,
its managing member
By: GS Advisors 2000, L.L.C.,
its general partner
By: /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
LXH II, L.L.C.
By: GS Capital Partners 2000 Offshore, L.P.,
its managing member
By: GS Advisors 2000, L.L.C.,
its general partner
By: /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
HEXCEL CORPORATION
By: /s/ Xxx Xxxxxxxx
-------------------------
Name: Xxx X. Xxxxxxxx
Title: Senior Vice President
