EXHIBIT 10.12
AMENDMENT TO AGREEMENTS
AGREEMENT, dated as of October 11, 2000 by and between Hexcel
Corporation, a Delaware corporation (the "Company") and Xxxxx Xxxxxxx (the
"Executive").
WHEREAS, the Company maintains the Hexcel Corporation
Incentive Stock Plan (the "Plan") and the Hexcel Corporation Management Stock
Purchase Plan (the "MSPP"); and
WHEREAS, the Company has granted to the Executive (1) under
the Plan, nonqualified options ("NQOs") to acquire shares of the common stock of
the Company (the "Common Stock"), performance accelerated stock options ("PASOs"
and, together with the NQOs, the "Options") to acquire shares of Common Stock
and contractual rights representing the right to earn shares of Common Stock
under specified circumstances ("PARs") and (2) contractual rights under the MSPP
representing the right to earn shares of Common Stock under specified
circumstances ("RSUs"), in each case evidenced by written award agreements
entered into between the Company and the Executive (the "Award Agreements"); and
WHEREAS, under the Award Agreements the Executive has certain
rights upon the occurrence of a Change in Control (as defined thereby); and
WHEREAS, Ciba Specialty Chemicals Holding, Inc. ("Ciba SCH"),
Ciba Specialty Chemicals Inc. ("Ciba SCI"), Ciba Specialty Chemicals Corporation
("Ciba SCC" and together with Ciba SCH and Ciba SCI, "Ciba"), LXH, L.L.C.
("LXH") and LXH II, L.L.C. ("LXH II" and together with LXH, "the Purchasers")
have entered into a Stock Purchase Agreement dated as of October 11, 2000 (the
"Stock Purchase Agreement") pursuant to which, among other things, the
Purchasers will purchase from Ciba shares of Common Stock; and
WHEREAS, the consummation (the "Closing") of the transactions
contemplated by the Stock Purchase Agreement (the "Transactions") will
constitute a Change in Control under the Plan, the MSPP and the Award
Agreements; and
WHEREAS, the Company desires the Executive to waive certain
rights under the Plan, the MSPP and the Award Agreements and desires to provide
additional incentives to the Executive to remain employed by the Company
following the Closing.
NOW, THEREFORE, the Company and the Executive hereby agree as
follows.
1. The consummation of the Transactions shall not constitute a
Change in Control for purposes of the Plan, the MSPP or the Award Agreements,
notwithstanding anything therein to the contrary.
2. Each Award Agreement is hereby amended to incorporate a new
definition of the term Change in Control (and related definitions), in the form
annexed hereto as Exhibit A.
3. Each Award Agreement pursuant to which Options have been
granted is hereby amended to provide that each Option that is unvested at the
Closing will vest and become exercisable on the earliest to occur of (i) as to
50% of the shares subject thereto, on the 1st anniversary of the Closing and as
to the remaining 50% of the shares subject thereto, on the 2nd anniversary of
the Closing, (ii) the Executive's termination of employment due to death,
Disability (as defined in Exhibit B hereto), termination by the Company without
Cause (as defined in Exhibit B hereto) or by the Executive for Good Reason (as
defined in Exhibit B hereto) or (iii) the occurrence of a Change in Control (as
defined in Exhibit A hereto).
4. Each Award Agreement pursuant to which PARs have been
granted is hereby amended to provide that each PAR subject thereto will vest
and, without being subject to the existing limitations relating to Section
162(m) of the Internal Revenue Code of 1986, as amended, the underlying shares
will be distributed on the earliest to occur of (i) as to 50% of the shares
subject thereto, on the 1st anniversary of the Closing and as to the remaining
50% of the shares subject thereto, on the 2nd anniversary of the Closing, (ii)
the Executive's termination of employment due to death, Disability, termination
by the Company without Cause or by the Executive for Good Reason or (iii) the
occurrence of a Change in Control (as defined in Exhibit A hereto).
5. Each Award Agreement pursuant to which RSUs have been
granted is hereby amended to provide that each RSU subject thereto will vest and
the underlying shares will be distributed on the earliest to occur of (i) as to
50% of the shares subject thereto, on the 1st anniversary of the Closing and as
to the remaining 50% of the shares subject thereto, on the 2nd anniversary of
the Closing, (ii) the Executive's termination of employment due to death,
Disability, termination by the Company without Cause or by the Executive for
Good Reason or (iii) the occurrence of a Change in Control (as defined in
Exhibit A hereto).
6. Except as otherwise expressly provided herein, the Award
Agreements shall remain in effect in accordance with their respective terms.
7. Effective as of the date on which the Closing occurs (the
"Closing Date"), the Company shall grant to the Executive options to acquire
13,540 shares of Common Stock. Such options shall be at an exercise price per
share equal to the greater of (a) the fair market value (as defined in the Plan)
of a share of Common Stock on the Closing Date or (b) $11, and shall otherwise
be made pursuant to the form of Stock Option Agreement annexed hereto as Exhibit
C. The Company agrees that such grant shall not be in lieu of, or otherwise be
taken into account in determining the size or terms of, the annual long term
incentive grant to the Executive for the 2001 or other fiscal year.
8. For purposes of this Agreement, notices, demands, and all
other communications provided for hereunder shall be in writing and shall be
deemed to have been duly given when hand delivered or (unless otherwise
specified) when mailed by United States certified mail, return receipt
requested, postage prepaid, addressed as follows:
To the Executive at the address shown in the personnel records
of the Company
To the Company at:
Hexcel Corporation
Two Stamford Plaza
281 Tresser Boulevard
Stamford Connecticut 06901-3238
Att'n:
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
9. The invalidity or unenforceability of any provision hereof
shall not affect the other provisions hereof, and this Agreement shall be
construed in all respects as if such invalid or unenforceable provision had been
omitted.
10. No change, modification or waiver of any provision of this
Agreement shall be valid unless the same be in writing and signed by the parties
hereto.
11. This Agreement contains the entire understanding of the
parties hereto with respect to the subject matter hereof and supersedes all
prior communications, representations and negotiations in respect thereto.
12. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Delaware, without regard
to its conflicts of law rules.
13. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original but all of which together shall
constitute one and the same instrument.
14. This agreement shall become effective upon the Closing,
and shall be null and void and of no effect if the Closing does not occur.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date and year first written above.
HEXCEL CORPORATION
By: /s/ Xxx X. Xxxxxxxx
Name: Xxx X. Xxxxxxxx
Title: Senior Vice President
/s/ Xxxxx Xxxxxxx
Xxxxx Xxxxxxx
EXHIBIT A
Affiliate of any Person shall mean 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 shall have the meaning specified
in Rule 12b-2 under the Securities Exchange Act of 1934 as in effect on the date
of this Agreement.
Beneficial Owner shall have the meaning used in Rule 13d-3 promulgated under the
Exchange Act.
Change in Control means:
(i) any Person is or becomes the Beneficial Owner, directly or indirectly, of
40% or more of either (x) the then outstanding common stock of the Company (the
"Outstanding Common Stock") or (y) the combined voting power of the then
outstanding securities entitled to vote generally in the election of directors
of the Company (the "Total Voting Power"), excluding, however, the following (1)
any acquisition by the Company or any of its Controlled Affiliates, (2) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any of its Controlled Affiliates and (3) any Person
who becomes such a Beneficial Owner in connection with a transaction described
in the exclusion within clause (iii) below; or
(ii) a change in the composition of the Board such that the individuals who, on
the date hereof, constitute the Board (such individuals shall be hereinafter
referred to as the "Incumbent Directors") cease for any reason to constitute at
least a majority of the Board; provided, however, for purposes of this
definition that any individual who becomes a director subsequent to such date
whose election, or nomination for election by the Company's stockholders, was
made or approved pursuant to the Governance Agreement or by a vote of at least a
majority of the Incumbent Directors (or directors whose election or nomination
for election was previously so approved) shall be considered a member of the
Incumbent Board; but, provided, further, that any such individual whose initial
assumption of office occurs as a result of either an actual or threatened
election contest (as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) or other actual or threatened solicitation
of proxies or consents by or on behalf of a person or legal entity other than
the Board shall not be considered a member of the Incumbent Board; or
(iii) there is consummated a merger or consolidation of the Company or any
direct or indirect subsidiary of the Company or a sale or other disposition of
all or substantially all of the assets of the Company ("Corporate Transaction");
excluding, however, such a Corporate Transaction pursuant to which (x) all or
substantially all of the individuals and entities who are the Beneficial Owners,
respectively, of the Outstanding Common Stock and the Total Voting Power
immediately prior to such Corporate Transaction will Beneficially Own, directly
or indirectly, more than 50%, respectively, of the outstanding common stock
and the combined voting power of the outstanding common stock and the combined
voting power of the then outstanding securities entitled to vote generally in
the election of directors of the company resulting from such Corporate
Transaction (including, without limitation, a corporation which as a result of
such transaction owns the Company or all or substantially all of the Company's
assets either directly or through one or more subsidiaries) in substantially the
same proportions as their ownership immediately prior to such Corporate
Transaction of the Outstanding Common Stock and Total Voting Power, as the case
may be, and (y) immediately following which the individuals who comprise the
Board immediately prior thereto constitute at least a majority of the board of
directors of the company resulting from such Corporate Transaction (including,
without limitation, a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company's assets either directly or
through one or more subsidiaries); or
(iv) the approval by the stockholders of the Company of a complete liquidation
or dissolution of the Company.
Exchange Act shall mean the Securities Exchange Act of 1934, as amended.
Governance Agreement shall mean the Governance Agreement, dated [ ],
2000, among LXH, L.L.C., LXH II, L.L.C., Hexcel Corporation and the other
parties listed on the signature pages thereto.
Person shall have the meaning set forth in Section 3(a)(9) of the Exchange Act,
as modified and used in Sections 13(d) and 14(d) of the Exchange Act.
EXHIBIT B
"Cause" shall mean (A) the willful and continued failure by the Optionee to
substantially perform the Optionee's duties with the Corporation (other than
any such failure resulting from the Optionee's incapacity due to physical or
mental illness or any such actual or anticipated failure after the issuance of a
Notice of Termination by the Executive for Good Reason) after demand for
substantial performance is delivered to the Optionee by the Corporation, that
specifically identifies the manner in which the Corporation believes that the
Optionee has not substantially performed the Optionee's duties, or (B) the
willful engaging by the Optionee in misconduct that is demonstrably and
materially injurious to the Corporation, monetarily or otherwise including, but
not limited to conduct that violates any written noncompetition covenant between
the Optionee and the Corporation. No act, or failure to act, on the Optionee's
part shall be deemed "willful" unless done, or omitted to be done, by the
Optionee not in good faith and without reasonable belief that the Optionee's
action or omission was in the best interest of the Corporation. Notwithstanding
the foregoing, the Optionee shall not be deemed to have been terminated for
Cause without (i) reasonable notice from the Board to the Optionee setting forth
the reasons for the Corporation's intention to terminate for Cause, (ii)
delivery to the Optionee of a resolution duly adopted by the affirmative vote
two-thirds or more of the Board then in office (excluding the Optionee if he is
then a member of the Board) at a meeting of the Board called and held for such
purpose, finding that in the good faith opinion of the Board, the Optionee was
guilty of conduct herein set forth and specifying the particulars thereof in
detail, (iii) an opportunity for the Optionee, together with his counsel, to be
heard before the Board, and (iv) delivery to the Optionee of a Notice of
Termination from the Board specifying the particulars in detail.
"Disability" shall mean that, as a result of the Optionee's incapacity due to
physical or mental illness or injury, he or she shall not have performed all or
substantially all of his or her usual duties as an employee of the Corporation
for a period of more than one-hundred-fifty (150) days in any period of
one-hundred-eighty (180) consecutive days.
"Good Reason" for termination by the Optionee of the Optionee's employment shall
mean:
(a) A diminution in the Optionee's position, duties, responsibilities
or authority (except during periods when the Executive is unable to
perform all or substantially all of his duties on account of illness
(either physical or mental) or other incapacity;
(b) A reduction in the Optionee's annual rate of base salary as in
effect on the date hereof or as the same may be increased from time to
time;
(c) Failure by the Corporation to continue in effect any compensation
plan in which the Optionee participates which is material to the
Optionee's total compensation, unless an equitable arrangement
(embodied in an ongoing substitute plan) has been made with respect to
such plan, or failure by the Corporation to continue the Optionee's
participation therein (or in such substitute plan) on a basis not
materially less favorable to the Optionee;
(d) Failure by the Corporation to continue to provide the Optionee with
benefits substantially similar to those enjoyed by the Optionee under
any of the Corporation's pension, savings, life insurance, medical,
health and accident, or disability plans in which the Optionee was
participating (except for across-the-board changes similarly affecting
all senior executives of the Corporation and all senior executives of
any Person in control of the Corporation), or failure by the
Corporation to continue to provide the Optionee with the number of paid
vacation days per year equal to the greater 4 weeks and (b) the number
to which the Optionee is entitled in accordance with the Corporation's
vacation policy;
(e) Failure to provide facilities or services which are suitable to the
Optionee 's position;
(f) Failure of any successor (whether direct or indirect, by purchase
of stock or assets, merger, consolidation or otherwise) to the
Corporation to assume the Corporation's obligations hereunder or
failure by the Corporation to remain liable to the Optionee hereunder
after such assumption;
(g) Any termination by the Corporation of the Optionee's employment
which is not effected pursuant to a Notice of Termination satisfying
the requirements of a Notice of Termination contained in this
Agreement;
(h) The relocation of the Optionee's principal place of employment to a
location more than fifty (50) miles from the Optionee's principal place
of employment as of the date hereof; or
(i) Failure to pay the Optionee any portion of current or deferred
compensation within seven (7) days of the date such compensation is
due.
The Optionee's continued employment shall not constitute consent to, or waiver
of rights with respect to, any circumstance constituting Good Reason hereunder;
provided, however, that the Optionee shall be deemed to have waived his rights
pursuant to circumstances constituting Good Reason hereunder if he shall not
have provided the Corporation a Notice of Termination within ninety (90) days
following his knowledge of the occurrence of circumstances constituting Good
Reason.
"Notice of Termination" shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Optionee's employment under the provision so indicated.
EXHIBIT C
EMPLOYEE OPTION AGREEMENT
(October , 2000)
EMPLOYEE OPTION AGREEMENT, dated as of the Grant Date, by and between the
Optionee and Hexcel Corporation (the "Corporation").
W I T N E S S E T H:
WHEREAS, the Corporation has adopted the Hexcel Corporation Incentive Stock
Plan (the "Plan"); and
WHEREAS, the Executive Compensation Committee (the "Committee") of the
Board of Directors of the Corporation (the "Board") has determined that it is
desirable and in the best interest of the Corporation to grant to the Optionee a
stock option as an incentive for the Optionee to advance the interests of the
Corporation;
NOW, THEREFORE, the parties agree as follows:
1. Notice of Grant; Incorporation of Plan. A Notice of Grant is attached
hereto as Annex A and incorporated by reference herein. Unless otherwise
provided herein, capitalized terms used herein and set forth in such Notice
of Grant shall have the meanings ascribed to them in the Notice of Grant
and capitalized terms used herein and set forth in the Plan shall have the
meanings ascribed to them in the Plan. The Plan is incorporated by
reference and made a part of this Employee Option Agreement, and this
Employee Option Agreement shall be subject to the terms of the Plan, as the
Plan may be amended from time to time, provided that any such amendment of
the Plan must be made in accordance with Section X of the Plan. The Option
granted herein constitutes an Award within the meaning of the Plan.
2. Grant of Option. Pursuant to the Plan and subject to the terms and
conditions set forth herein and therein, the Corporation hereby grants to
the Optionee the right and option (the "Option") to purchase all or any
part of the Option Shares of the Corporation's common stock, $.01 par value
per share (the "Common Stock"), which Option is not intended to qualify as
an incentive stock option, as defined in Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code").
3. Purchase Price. The purchase price per share of the Option Shares shall be
the Purchase Price.
4. Term of Option.
(a) Expiration Date; Term. Subject to Section 4(c) below, the Option shall
expire on, and shall no longer be exercisable following, the tenth
anniversary of the Grant Date. The ten-year period from the Grant Date
to its tenth anniversary shall constitute the "Term" of the Option.
(b) Vesting Period; Exercisability. Subject to Section 4(c) below, the
Option shall vest and become exercisable at the rate of 33-1/3% of the
Option Shares on each of the first three anniversaries of the Grant
Date.
(c) Termination of Employment; Change in Control.
(i) For purposes of the grant hereunder, any transfer of employment
by the Optionee among the Corporation and the Subsidiaries shall
not be considered a termination of employment. Except as set
forth below in this Section 4(c)(i), if the Optionee's employment
with the Corporation shall terminate for any reason, (a) the
Option (to the extent then vested) may be exercised at any time
within ninety (90) days after such termination (but not beyond
the Term of the Option) and (b) the Option, to the extent not
then vested, shall immediately expire upon such termination.
Notwithstanding the foregoing, (a) if the Optionee's employment
with the Corporation is terminated for Cause (as defined in the
last Section hereof), the Option, whether or not then vested,
shall be automatically terminated as of the date of such
termination of employment and (b) if the Optionee dies or is
disabled (A) while employed by the Corporation or (B) within 90
days after the termination of his or her employment (other than a
termination described in clause (a) of this sentence), the Option
may be exercised at any time within 365 days after the Optionee's
death or disability (but not beyond the Term of the Option).
(ii) If the Optionee's employment terminates by reason of death,
Disability, the termination of the Optionee's employment by the
Company other than for Cause, or the termination of the
Optionee's employment by the Optionee for Good Reason, the Option
shall become fully and immediately vested and exercisable. In the
event of a Change in Control (as defined in the last Section
hereof), the Option shall immediately become fully vested and
exercisable.
5. Adjustment Upon Changes in Capitalization.
(a) The aggregate number of Option Shares and the Purchase Price shall be
appropriately adjusted by the Committee for any increase or decrease
in the number of issued shares of Common Stock resulting from a
subdivision or consolidation of shares or other capital adjustment, or
the payment of a stock dividend or other increase or decrease in such
shares, effected without receipt of consideration by the Corporation,
or other change in corporate or capital structure. The Committee shall
also make the foregoing changes and any other changes, including
changes in the classes of securities available, to the extent
reasonably necessary or desirable to preserve the intended benefits
under this Employee Option Agreement in the event of any other
reorganization, recapitalization, merger, consolidation, spin-off,
extraordinary dividend or other distribution or similar transaction
involving the Corporation.
(b) Any adjustment under this Section 5 in the number of Option Shares and
the Purchase Price shall apply to only the unexercised portion of the
Option. If fractions of a share would result from any such adjustment,
the adjustment shall be rounded down to the nearest whole number of
shares.
6. Method of Exercising Option and Withholding.
(a) The Option shall be exercised by the delivery by the Optionee to the
Corporation at its principal office (or at such other address as may
be established by the Committee) of written notice of the number of
Option Shares with respect to which the Option is exercised,
accompanied by payment in full of the aggregate Purchase Price for
such Option Shares. Payment for such Option Shares shall be made (i)
in U.S. dollars by personal check, bank draft or money order payable
to the order of the Corporation, or by money transfers or direct
account debits to an account designated by the Corporation; (ii)
through the delivery of shares of Common Stock with a Fair Market
Value equal to the total payment due from the Optionee; (iii) pursuant
to a "cashless exercise" program if such a program is established by
the Corporation; or (iv) by any combination of the methods described
in (i) through (iii) above.
(b) The Corporation's obligation to deliver shares of Common Stock upon
the exercise of the Option shall be subject to the payment by the
Optionee of applicable federal, state and local withholding tax, if
any. The Corporation shall, to the extent permitted by law, have the
right to deduct from any payment of any kind otherwise due to the
Optionee any federal, state or local taxes required to be withheld
with respect to such payment.
7. Transfer. The Option is not transferable otherwise than by will or the laws
of descent and distribution, and the Option may be exercised during the
Optionee's lifetime only by the Optionee. Any attempt to transfer the
Option in contravention of this Section 7 is void ab initio. The Option
shall not be subject to execution, attachment or other process.
8. No Rights in Option Shares. The Optionee shall have none of the rights of a
stockholder with respect to the Option Shares unless and until shares of
Common Stock are issued upon exercise of the Option.
9. No Right to Employment. Nothing contained herein shall be deemed to confer
upon the Optionee any right to remain as an employee of the Corporation.
10. Governing Law/Jurisdiction. This Employee Option Agreement shall be
governed by and construed in accordance with the laws of the State of
Delaware without reference to principles of conflict of laws.
11. Resolution of Disputes. Any disputes arising under or in connection with
this Employee Option Agreement shall be resolved by binding arbitration
before a single arbitrator, to be held in New York in accordance with the
commercial rules and procedures of the American Arbitration Association.
Judgment upon the award rendered by the arbitrator shall be final and
subject to appeal only to the extent permitted by law. Each party shall
bear such party's own expenses incurred in connection with any arbitration;
provided, however, that the cost of the arbitration, including without
limitation, reasonable attorneys' fees of the Optionee, shall be borne by
the Corporation in the event the Optionee is the prevailing party in the
arbitration. Anything to the contrary notwithstanding, each party hereto
has the right to proceed with a court action for injunctive relief or
relief from violations of law not within the jurisdiction of an arbitrator.
12. Notices. Any notice required or permitted under this Employee Option
Agreement shall be deemed given when delivered personally, or when
deposited in a United States Post Office, postage prepaid, addressed, as
appropriate, to the Optionee at the last address specified in Optionee's
employment records, or such other address as the Optionee may designate in
writing to the Corporation, or to the Corporation, Attention: Corporate
Secretary, or such other address as the Corporation may designate in
writing to the Optionee.
13. Failure To Enforce Not a Waiver. The failure of either party hereto to
enforce at any time any provision of this Employee Option Agreement shall
in no way be construed to be a waiver of such provision or of any other
provision hereof.
14. Counterparts. This Employee Option Agreement may be executed in two or more
counterparts, each of which shall be an original but all of which together
shall represent one and the same agreement.
15. Miscellaneous. This Employee Option Agreement cannot be changed or
terminated orally. This Employee Option Agreement and the Plan contain the
entire agreement between the parties relating to the subject matter hereof.
The section headings herein are intended for reference only and shall not
affect the interpretation hereof.
16. Definitions. For purposes of this Employee Option Agreement:
(I) the term "Affiliate" of any Person shall mean 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. The term "Control" shall have the meaning specified in
Rule 12b-2 under the Securities Exchange Act of 1934 as in effect on
the date of this Agreement;
(II) the term "Beneficial Owner" shall have the meaning used in Rule
13d-3 promulgated under the Exchange Act;
(III) the term "Cause" shall mean (A) the willful and continued
failure by the Optionee to substantially perform the Optionee's duties
with the Corporation (other than any such failure resulting from the
Optionee's incapacity due to physical or mental illness or any such
actual or anticipated failure after the issuance of a Notice of
Termination by the Executive for Good Reason) after demand for
substantial performance is delivered to the Optionee by the
Corporation, that specifically identifies the manner in which the
Corporation believes that the Optionee has not substantially performed
the Optionee's duties, or (B) the willful engaging by the Optionee in
misconduct that is demonstrably and materially injurious to the
Corporation, monetarily or otherwise including, but not limited to
conduct that violates any written noncompetition covenant between the
Optionee and the Corporation. No act, or failure to act, on the
Optionee's part shall be deemed "willful" unless done, or omitted to
be done, by the Optionee not in good faith and without reasonable
belief that the Optionee's action or omission was in the best interest
of the Corporation. Notwithstanding the foregoing, the Optionee shall
not be deemed to have been terminated for Cause without (i) reasonable
notice from the Board to the Optionee setting forth the reasons for
the Corporation's intention to terminate for Cause, (ii) delivery to
the Optionee of a resolution duly adopted by the affirmative vote
two-thirds or more of the Board then in office (excluding the Optionee
if he is then a member of the Board) at a meeting of the Board called
and held for such purpose, finding that in the good faith opinion of
the Board, the Optionee was guilty of conduct herein set forth and
specifying the particulars thereof in detail, (iii) an opportunity for
the Optionee, together with his counsel, to be heard before the Board,
and (iv) delivery to the Optionee of a Notice of Termination from the
Board specifying the particulars in detail.
(IV) the term "Change in Control" shall mean any of the following
events:
(1) any Person is or becomes the Beneficial Owner, directly or
indirectly, of 40% or more of either (x) the then outstanding
common stock of the Company (the "Outstanding Common Stock") or
(y) the combined voting power of the then outstanding securities
entitled to vote generally in the election of directors of the
Company (the "Total Voting Power"), excluding, however, the
following (1) any acquisition by the Company or any of its
Controlled Affiliates, (2) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the
Company or any of its Controlled Affiliates and (3) any Person
who becomes such a Beneficial Owner in connection with a
transaction described in the exception within clause (3) below;
or
(2) a change in the composition of the Board such that the
individuals who, on the date hereof, constitute the Board (such
individuals shall be hereinafter referred to as the "Incumbent
Directors") cease for any reason to constitute at least a
majority of the Board; provided, however, for purposes of this
definition that any individual who becomes a director
subsequent to such date whose election, or nomination for
election by the Company's stockholders, was made or approved
pursuant to the Governance Agreement or by a vote of at least a
majority of the Incumbent Directors (or directors whose election
or nomination for election was previously so approved) shall be
considered a member of the Incumbent Board; but, provided,
further, that any such individual whose initial assumption of
office occurs as a result of either an actual or threatened
election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies or consents by or on
be half of a person or legal entity other than the Board shall
not be considered a member of the Incumbent Board; or
(3) there is consummated a merger or consolidation of the Company or
any direct or indirect subsidiary of the Company or a sale or
other disposition of all or substantially all of the assets of
the Company ("Corporate Transaction"); excluding, however, such a
Corporate Transaction pursuant to which (x) all or substantially
all of the individuals and entities who are the Beneficial
Owners, respectively, of the Outstanding Common Stock and the
Total Voting Power immediately prior to such Corporate
Transaction will Beneficially Own, directly or indirectly, more
than 50%, respectively, of the outstanding common stock and the
combined voting power of the outstanding common stock and the
combined voting power of the then outstanding securities entitled
to vote generally in the election of directors of the company
resulting from such Corporate Transaction (including, without
limitation, a corporation which as a result of such transaction
owns the Company or all or substantially all of the Company's
assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership immediately
prior to such Corporate Transaction of the Outstanding Common
Stock and Total Voting Power, as the case may be, and (y)
immediately following which the individuals who comprise the
Board immediately prior thereto constitute at least a majority of
the board of directors of the company resulting from such
Corporate Transaction (including, without limitation, a
corporation which as a result of such transaction owns the
Company or all or substantially all of the Company's assets
either directly or through one or more subsidiaries); or
(4) the approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.
(V) the term "Disability (or becoming Disabled)" shall mean that, as a
result of the Optionee's incapacity due to physical or mental illness
or injury, he or she shall not have performed all or substantially all
of his or her usual duties as an employee of the Corporation for a
period of more than one-hundred-fifty (150) days in any period of
one-hundred-eighty (180) consecutive days;
(VI) the term "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended from time to time;
(VII) the term "Good Reason" for termination by the Optionee of the
Optionee's employment shall mean:
(1) A diminution in the Optionee's position, duties, responsibilities
or authority (except during periods when the Executive is unable
to perform all or substantially all of his duties on account of
illness (either physical or mental) or other incapacity;
(2) A reduction in the Optionee's annual rate of base salary as in
effect on the date hereof or as the same may be increased from
time to time;
(3) Failure by the Corporation to continue in effect any compensation
plan in which the Optionee participates which is material to the
Optionee's total compensation, unless an equitable arrangement
(embodied in an ongoing substitute plan) has been made with
respect to such plan, or failure by the Corporation to continue
the Optionee's participation therein (or in such substitute plan)
on a basis not materially less favorable to the Optionee;
(4) Failure by the Corporation to continue to provide the Optionee
with benefits substantially similar to those enjoyed by the
Optionee under any of the Corporation's pension, savings, life
insurance, medical, health and accident, or disability plans in
which the Optionee was participating (except for across-the-board
changes similarly affecting all senior executives of the
Corporation and all senior executives of any Person in control of
the Corporation), or failure by the Corporation to continue to
provide the Optionee with the number of paid vacation days per
year equal to the greater 4 weeks and (b) the number to which the
Optionee is entitled in accordance with the Corporation's
vacation policy;
(5) Failure to provide facilities or services which are suitable to
the Optionee's position;
(6) Failure of any successor (whether direct or indirect, by purchase
of stock or assets, merger, consolidation or otherwise) to the
Corporation to assume the Corporation's obligations hereunder or
failure by the Corporation to remain liable to the Optionee
hereunder after such assumption;
(7) Any termination by the Corporation of the Optionee's employment
which is not effected pursuant to a Notice of Termination
satisfying the requirements of a Notice of Termination contained
in this Agreement;
(8) the relocation of the Optionee's principal place of employment to
a location more than fifty (50) miles from the Optionee's
principal place of employment as of the date hereof; or
(9) Failure to pay the Optionee any portion of current or deferred
compensation within seven (7) days of the date such compensation
is due.
The Optionee's continued employment shall not constitute consent to, or
waiver of rights with respect to, any circumstance constituting Good
Reason hereunder; provided, however, that the Optionee shall be deemed
to have waived his rights pursuant to circumstances constituting Good
Reason hereunder if he shall not have provided the Corporation a Notice
of Termination within ninety (90) days following his knowledge of the
occurrence of circumstances constituting Good Reason;
(VIII) the term "Governance Agreement" shall mean the Governance
Agreement, dated [ ], 2000, among LXH, L.L.C., LXH II, L.L.C., Hexcel
Corporation and the other parties listed on the signature pages
thereto;
(IX) the term "Person" shall have the meaning given in Section 3(a)(9)
of the Exchange Act, as modified and used in Sections 13(d) and 14(d)
of the Exchange Act; and
(X) the term "Notice of Termination" shall mean a notice which shall
indicate the specific termination provision in this Agreement relied
upon and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the
Optionee's employment under the provision so indicated.
Annex A
NOTICE OF GRANT
EMPLOYEE STOCK OPTION
HEXCEL CORPORATION INCENTIVE STOCK PLAN
The following employee of Hexcel Corporation, a Delaware corporation
("Hexcel") or a Subsidiary, has been granted an option to purchase shares of the
Common Stock of Hexcel, $.01 par value, in accordance with the terms of this
Notice of Grant and the Employee Option Agreement to which this Notice of Grant
is attached.
The following is a summary of the principal terms of the option which
has been granted. The terms below shall have the meanings ascribed to them below
when used in the Employee Option Agreement.
Optionee
-------------------------------------- ----------------------------------------
Address of Optionee
-------------------------------------- ----------------------------------------
Employee Number
-------------------------------------- ----------------------------------------
Employee ID Number
-------------------------------------- ----------------------------------------
Foreign Sub Plan, if applicable
-------------------------------------- ----------------------------------------
Grant Date
-------------------------------------- ----------------------------------------
Purchase Price
-------------------------------------- ----------------------------------------
Aggregate Number of Shares
Granted (the "Option Shares")
-------------------------------------- ----------------------------------------
IN WITNESS WHEREOF, the parties hereby agree to the terms of this
Notice of Grant and the Employee Option Agreement to which this Notice of Grant
is attached and execute this Notice of Grant and Employee Option Agreement as of
the Grant Date.
HEXCEL CORPORATION
Optionee
By:
Xxx X. Xxxxxxxx
Senior Vice President
