EXHIBIT 10.42
SEVERANCE AND TERMINATION AGREEMENT
This Severance and Termination Agreement (the "Agreement") is made and
effective as of the 17th day of December, 2001 (the "Effective Date") between
Hexcel Corporation (the "Company"), for itself and on behalf of its direct and
indirect affiliated entities, and Xxxxxx X. Xxxxx (the "the Employee").
RECITALS
WHEREAS, the Company and its direct and indirect affiliated entities
(together, the "Consolidated Group") are engaged in the business of developing,
manufacturing and marketing carbon fibers, fabrics, composite materials and
parts therefrom for the commercial aerospace, space and defense, electronics,
recreation and industrial markets throughout the world, and hereafter may engage
in other areas of business (collectively, the "Business"); and
WHEREAS, the Company employs the Employee as its President and Chief
Operating Officer on the date hereof; and
WHEREAS, as a result of the Employee's employment with the Company, the
Employee has extensive knowledge of the Business and, in particular,
technologies, customers, markets and strategic plans relating to the Business;
and
WHEREAS, the Employee and the Company are parties to the Agreements
identified on Schedule A hereto (the "Existing Agreements"), which are
identified on Schedule A as "Employment Agreements" (the "Employment
Agreements") and as "Equity Agreements" (the "Equity Agreements"); and
WHEREAS, the Employee and the Company desire to terminate the employment
relationship on an amicable basis effective as of January 4, 2002 (the
"Termination Date) and to continue to engage the Employee as a consultant
through July 1, 2002; and
WHEREAS, the Company is willing to provide the Employee with certain
benefits in connection with the termination of the Employee's employment with
the Company; and
WHEREAS, the Employee, in consideration of receiving such employment
termination benefits from the Company, is willing to afford certain protection
to the Company in regard to the confidentiality of its information, ownership of
inventions and competitive activities, and is willing to release the Company
from claims relating to or arising out of the employment relationship.
AGREEMENT
NOW THEREFORE, in consideration of the mutual terms and conditions hereof,
and other good and valuable consideration, the receipt and sufficiency of which
are hereby
acknowledged, the Company and the Employee hereby agree as follows:
1. TERMINATION OF EMPLOYMENT
a) The Company and the Employee agree that, effective as of the Termination
Date, the Employee shall cease to be employed by the Company, and as of such
date the Employee voluntarily and amicably resigns from his employment with the
Company and from all of his officerships, directorships and other positions with
the Company and its affiliated entities, and the Company accepts such
resignations. The Employee further acknowledges that all files, records,
electronic data, documents and notes (and all copies, if any, thereof) relating
to the Consolidated Group, whether prepared by the Employee or otherwise in his
possession, custody or control, together with all office or file keys and passes
and all other property of any member of the Consolidated Group, are the
exclusive property of the Consolidated Group and shall be delivered to the
Company and not retained by the Employee following the Termination Date.
b) The Company and the Employee agree that, effective as of the Termination
Date, the Employee shall be engaged as an independent consultant to the Company
on the terms and conditions set forth on Schedule B.
2. SEVERANCE BENEFITS.
a) SEVERANCE PAYMENTS AND BENEFITS. In consideration for the obligations of
Employee contained in this Agreement, including without limitation, the Basic
Covenants (as defined in Section 3(c)) and the Release contained in
Section 4(a), the Company shall provide the Employee with certain payments and
enhancements to certain of the Existing Agreements as follows:
i) SEVERANCE PAY. The Company shall pay the Employee as severance
pay an amount equal to two million four hundred forty-six thousand dollars
($2,446,000) less required deductions and withholdings. Such severance will
be paid (A) one million nine hundred thousand dollars ($1,900,000) on the
Termination Date by wire transfer to the bank account designated, at least
5 days in advance, by the Employee and (B) the balance at ninety-one
thousand dollars ($91,000) per month on or about the first day of each
month from February 2002 through July 2002.
ii) BENEFITS. As of the Termination Date, the Employee will be
eligible to continue group health coverage (i.e. medical and dental) as
permitted under the Consolidated Omnibus Budget Reconciliation Act of 1985
("COBRA"). If Employee elects COBRA continuation coverage, the Company will
pay the premium for such coverage from the Termination Date through July 1,
2002. In addition, to the extent permitted by the insurance policies
maintained by the Company, the Employee may elect to continue to be covered
under other insured benefit plans (including vision, life and disability)
at the coverage maintained for him and his family at the Termination Date
and the Company will pay the premium for such coverage from the Termination
Date through July 1, 2002. Except as specifically provided herein, after
the Termination Date, the Employee shall not be entitled to participate in
any benefit plan of the Company (including any welfare plan).
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iii) EQUITY AGREEMENTS. As of the Termination Date,
(1) Each Equity Agreement pursuant to which a Performance
Accelerated Restricted Stock unit or Restricted Stock Unit has been
granted is amended to provide that such units which are not vested as
of the Termination Date 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 Termination Date.
(2) Each Equity Agreement pursuant to which a stock option has
been granted is amended to provide that (A) each such stock option
that is unvested on the Termination Date will vest and become
exerciseable on the Termination Date; (B) all stock options granted
pursuant to such Equity Agreements (other than the Special Grant as
defined on Schedule A) shall remain exerciseable, and shall not
terminate, until January 4, 2003; and (C) all stock options granted
pursuant to the Special Grant shall remain exerciseable, and shall not
terminate, until January 4, 2005.
iv) OUTPLACEMENT. Following the Termination Date, the Company shall,
at its own expense, arrange for the Employee to receive outplacement
services at a level that is consistent with past practices of the Company
for other senior executives (but in no event shall the cost thereof exceed
$20,000), provided that such outplacement services shall be provided in the
Stamford, CT area. The Employee shall not be entitled to any payment should
the Employee determine not to receive such services.
v) EXISTING AGREEMENTS. Except as expressly provided in
Section 1(a)(iii), the Equity Agreements shall remain in full force and
effect in accordance with their respective terms. Except as expressly
provided in this Agreement, each of the Employment Agreements shall be of
no further force and effect.
b) OTHER RIGHTS. The Employee hereby waives, and shall not be entitled to,
any payment to which he would be entitled under the Company's Management
Incentive Compensation Plan ("MICP") for 2001, and shall not be entitled to
participate in the MICP nor any other profit sharing program for 2002. The
Employee hereby waives, and shall not be entitled to receive any grant of any
equity incentives for 2002 or thereafter. This Agreement shall not affect the
Employee's vested rights (determined as of the Termination Date) in, or the
Employee's obligations under, any welfare benefit or pension plan (including the
Hexcel Corporation Pension Plan and the Hexcel Corporation 401(k) Plan). This
Agreement shall not affect the Employee's right to reimbursement for reasonable
business expenses incurred, or for current base salary and accrued vacation
earned, on or before the Termination Date, except that the accrued vacation
earned through the Termination Date shall be fixed at 160 hours notwithstanding
actual accruals.
c) SURVIVAL OF INDEMNIFICATION. Without limiting the generality of the
foregoing, this Agreement does not in any way affect nor release the Employee's
right to indemnification, if any, from the Consolidated Group against third
party claims as provided by law, by agreement or by each member of the
Consolidated Group's charter and by-laws; provided however, the Employee
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will fully cooperate with the Company as may be requested by the Company in
connection with any proceedings or legal actions in which the Company is or may
become involved, and will give truthful testimony and information in any such
proceedings and legal actions, but nothing in this Section shall prohibit the
Employee from responding to a valid subpoena or court order provided that the
Employee has given the Company sufficient notice of such subpoena or court order
to allow the Company an opportunity to seek a protective order or other relief
limiting or barring such disclosure.
3. CONTINUING OBLIGATIONS.
a) PROPRIETARY INFORMATION. The Employee acknowledges that the
Consolidated Group's trade secrets and confidential and proprietary information
(collectively "Proprietary Information"), including without limitation:
i) Nonpublic information concerning the Consolidated Group's:
(1) Research activities and plans;
(2) Marketing or sales plans;
(3) Pricing or pricing strategies;
(4) Manufacturing techniques;
(5) Products; and
(6) Strategic plans;
ii) Nonpublic financial information, including information
concerning revenues, profits and profit margins; and
iii) Any nonpublic "material inside information" as such phrase
is used for purposes of the Securities Exchange Act of 1934, as amended;
constitute valuable, special and unique information of the Consolidated Group.
In recognition of this fact and in consideration of the benefits provided to the
Employee hereunder, the Employee agrees that he will not disclose any
Proprietary Information, to any person or entity, for any reason or purpose
whatsoever, nor shall the Employee make use of any Proprietary Information for
the benefit of himself or any person, firm, corporation or other entity.
Notwithstanding the above, Proprietary Information does not include information
(i) which is or becomes publicly available without violation of this Agreement,
(ii) of which the Employee, prior to disclosure by the Employee did not know and
should not have known was disclosed to the Employee by a third party in
violation of any other person's confidentiality or fiduciary obligation, and
(iii) which is disclosed in connection with any legal process, provided that the
Employee has notified the Company of such process in advance so that the Company
may object or obtain a protective order and the Employee reasonably cooperates
in the Company's attempt to eliminate or limit the scope of such disclosure.
This Section does not, however, affect the obligations of confidentiality which
the Employee otherwise may have under law or any other agreement with any member
of the Consolidated Group (including without limitation, the Confidentiality
Agreement defined on Schedule A and Section 8 of the Severance Agreement as
defined on Schedule A) provided, however, that this Agreement shall supercede
any such preexisting
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agreement with respect to the disclosure and/or use of confidential and/or
proprietary information on or after the Effective Date. Furthermore, this
Agreement does not affect the obligations of the Employee pursuant to Section 7
of the Severance Agreement.
b) NON-SOLICITATION; NON-COMPETE. Until two years following the
Termination Date, Employee shall not, without the prior written consent of the
Company, employ or solicit employment of, or suggest, encourage, or attempt to
influence the hiring or termination of any person employed on the date hereof by
any member of the Consolidated Group. Furthermore, Employee acknowledges that
the pursuit of the activities forbidden by this Section 3(b) would necessarily
involve the use or disclosure of Proprietary Information in breach of the
obligations of Section 3(a), but that proof of such breach would be extremely
difficult. To forestall such disclosure, use and breach, and in consideration of
the benefits provided Employee under Section 2, Employee agrees that until two
years after the Termination Date he will not engage, in any capacity, directly
or indirectly, including without limitation as employee, agent, consultant,
manager, executive, director, owner or stockholder (except as a passive investor
holding less than a 5% equity interest in an enterprise) in any business entity
engaged, in competition anywhere in the world with the Business conducted by the
Company or contemplated to be conducted by the Company on the Termination Date;
provided that the Employee may be employed by a competitor of the Company so
long as the Employee's duties and responsibilities do not relate directly or
indirectly to the business segment of the new employer which is actually or
potentially engaged in such prohibited competition. For purposes of this
Section 3(b) only, the Business conducted by the Company or contemplated to be
conducted by the Company is developing, manufacturing and marketing (i) carbon
fibers and composite materials (including without limitation, prepreg, adhesives
and core and panels manufactured therefrom) for the commercial aerospace, space
and defense, recreation and industrial markets, (ii) industrial and
reinforcement fabrics for commercial aerospace, space and defense, marine,
automotive and rail, printed wiring boards, architectural products, wind energy,
construction and civil engineering and ballistics, and (iii) composite parts for
commercial aerospace and space and defense markets. For purposes of giving legal
effect to the foregoing sentences, the parties acknowledge and agree that the
global nature of the business activities of the Consolidated Group as well as
the global nature of Employee's responsibilities within the Consolidated Group
require the geographic scope of this limitation to be worldwide.
c) BREACH OF BASIC COVENANTS. The Employee acknowledges and agrees
that, in the event of his breach of any of the Basic Covenants, the Company
would be irreparably and immediately harmed and could not be made whole by
monetary damages. It is accordingly agreed that any member of the Consolidated
Group, in addition to any other remedy to which it may be entitled in law or
equity, shall be entitled to an injunction to prevent breaches of any Basic
Covenants and/or to compel specific performance of any Basic Covenants. In
addition, in the event of any material breach of any Basic Covenants by the
Employee and failure of the Employee to cure such material breach within 10 days
following notice to him of such breach, the Company shall have no further
obligations under this Agreement including, without limitation, any obligation
to make any payment under Sections 1(b) and 2(a)(i), (ii) and (iv) or to amend
any Equity Agreement under Section 2(a)(iii). Notwithstanding anything to the
contrary contained in this Agreement, and in addition to other remedies provided
herein or by law, in the event that the Employee is in breach of any provisions
of Sections 3 and 8 of this Agreement
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(collectively, the "Basic Covenants"), then the Company shall be entitled to
recover from the Employee the value of all of the compensation, severance and
benefits received by the Employee pursuant to Sections 1(b) and 2(a), including
without limitation any spread between exercise price and market price of
employee stock options exercised after the Termination Date, together with
reasonable attorneys fees and expenses incurred by the Company in connection
therewith.
4. RELEASE.
a) RELEASE. In consideration of the mutual covenants and agreements
contained herein, the Employee, for himself and on behalf of his heirs,
executors, administrators and representatives, hereby irrevocably and
unconditionally, knowingly and voluntarily, releases, acquits, and forever
discharges each member of the Consolidated Group and their respective
stockholders, officers, directors, employees, representatives, attorneys and
agents, and each of their respective successors and assigns (referred to
collectively as the "Releasees") from any and all claims and causes of action
whether known to the Employee or unknown, suspected or unsuspected, which exist
or may have existed or may arise in any way relating to any act or omission or
other matter occurring up to and including the Termination Date, including,
without limitation, the Employee's employment relationship with the Company,
rights or claims which did exist or which might have been asserted pursuant to
any express or implied contract of employment or any Existing Agreement (except
as otherwise provided in this Agreement), or under any tort, federal, state, or
local fair employment practice or civil rights law, any other statute, executive
order, law, ordinance, or any other duty or obligation of any kind or
description. For the avoidance of doubt and not in limitation of the foregoing,
this release includes (i) all claims which have existed from the beginning of
the world to the Termination Date and which may arise in the future out of any
and all occurrences or omissions up to and including the Termination Date, and
(ii) all claims for alleged discrimination based upon age, race, sex, religion,
national origin, citizenship, or disability, and includes any claim asserted or
unasserted, which could arise under Title VII of the Civil Rights Act of 1964,
42 U.S.C. Section 1981, 42 U.S.C. Section 1983, the Connecticut Human Rights and
Opportunities Act, the Age Discrimination in Employment Act of 1967, 29 U.S.C.
Section 621 et seq., (individually and collectively, "ADEA"), New York Fair
Employment and Housing Act, the Family and Medical Leave Act, 29 U.S.C.
Section 2601 et seq., the Employee Retirement Income Security Act of 1974, 29
U.S.C. Section 1001 et seq., the Americans With Disabilities Act of 1990, 42
U.S.C. Section 12101 et seq., the Older Workers Benefit Protection Act
(individually and collectively, "OWBPA") and any fair employment practice, equal
employment opportunity, or employee benefit statute under any federal, state, or
local law, or any judicial decision or executive order now or hereafter
recognized, as well as any unsuspected and unanticipated claims, liens, injuries
and damages as well as those that are known.
b) ALL CLAIMS RELEASED. Notwithstanding anything to the contrary
contained in this Agreement, and for the purpose of implementing a full and
complete release, the Employee understands and agrees that, except as otherwise
provided in this Agreement, this Agreement is intended to include all claims, if
any, which the Employee may have that the Employee does not now know or suspect
to exist in the Employee's favor against the Company or any Releasee, and that
this Agreement extinguishes those claims; provided, however, that the matters
released pursuant to Section 4(a) hereof shall not include any express
obligation of the
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Company pursuant to this Agreement, nor any vested rights as described in
Section 2(b) hereof nor any rights to indemnity described in Section 2(c)
hereof.
In furtherance of the provisions of this Section 4(b), the Employee hereby
expressly consents that this Agreement shall be given full force and effect
according to each and all of its express terms and provisions, including those
extending to, involving, releasing or discharging, unknown and unsuspected
claims, demands or causes of action, if any.
c) EMPLOYEE'S RESPONSIBILITIES. The Employee hereby irrevocably and
unconditionally, knowingly and voluntarily, waives and gives up any right the
Employee has, had, or might have had to commence a legal action against the
Releasees with respect to the matters released in Section 4(a), to the full
extent permitted by applicable law. The Employee represents and warrants to the
Company that prior to the Effective Date he has not filed or permitted to be
filed with any court, governmental or administrative agency, or arbitration
tribunal, any complaint, lawsuit, charge or claim against any one or more of the
Releasees in respect of any such matter. The Employee further agrees and
covenants not to (i) seek or be entitled to any recovery in any proceeding of
any nature whatsoever in connection with such matters and (ii) except as may
otherwise be agreed to in writing by the Company, seek and accept employment
with any member of the Consolidated Group after the Termination Date. Should any
such proceeding be brought against any one or more of the Releasees, the
Employee shall take all steps necessary to opt out, abandon, and disclaim
interest in such proceeding. If such proceeding is brought successfully and
thereby the Employee becomes entitled to a monetary award, the Employee agrees
that the Releasees shall be entitled to recoup either the consideration paid
under this Agreement or the proceeds received by him in such proceeding,
whichever is less. Further, to the full extent permitted by applicable law, the
Employee shall not testify, assist or participate (except in response to
subpoena or judicial order) in any lawsuit or any judicial proceeding brought
against any one or more of the Releasees in connection with such matters.
Neither the existence nor terms of this Agreement nor any claims or allegations
that were or could have been raised by the Employee as of the Effective Date,
nor the facts and circumstances underlying such claims or allegations, shall be
admissible or submitted as evidence in any litigation in any forum for any
purpose other than to determine the enforceability and/or to secure enforcement
of the terms and conditions of this Agreement. Notwithstanding anything to the
contrary in this Section 4(c) or anywhere else in this Agreement, the Employee
may bring a claim to challenge the validity of this Agreement under the ADEA
and/or the OWBPA, and the Employee shall not be required to pay the attorneys
fees or costs incurred by the Company in connection with such a claim, and shall
not be required to repay any amounts to the Company that were paid to the
Employee by the Company under this Agreement as a result of bringing such a
claim.
d) REVOCATION. The Employee acknowledges that he received a draft of
this document on December 13, 2001; that he has been offered by the Company at
least forty-five days from the date he received this Agreement within which to
consider its terms; that he has been advised by the Company that during such
period he should consult an attorney regarding the terms of this Agreement and
that if he signs before the expiration of said forty-five days he does so of his
own free will and with the full knowledge that he could have taken the full
forty-five days and that he waives, in all respects, the forty-five day waiting
period he is permitted to
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review this Agreement; and he realizes and understands that this Agreement
applies to and covers all claims, demands, and causes of action, including those
that could be asserted under ADEA against the Consolidated Group. The Employee
represents and warrants that he has, in fact, considered this Agreement and that
he knowingly and voluntarily enters into this Agreement including, but not
limited to, the releases and waivers set forth above. The terms of this
Agreement shall become effective and enforceable upon the Effective Date.
Notwithstanding the preceding sentence, the Employee shall have seven (7) days
from the Effective Date to revoke his consent to the release and waiver of his
rights under ADEA set forth in Section 4(a) herein by written notice to be
received by the Company before 5:00 P.M. New York City time on the seventh day.
If no such revocation occurs, the Employee's release and waiver of his rights
under ADEA shall become effective at such time. In the event that the Employee
revokes his release and waiver of rights under ADEA, the Company shall have no
obligation to the Employee under either Section 1(b) or 2(a), but all other
terms, provisions and agreements contained in this Agreement shall remain in
full force and effect.
5. VALIDITY; INJUNCTIVE RELIEF. Notwithstanding anything to the contrary
contained in this Agreement, the terms of this Agreement shall be regarded as
severable. If any provision of this Agreement, or the application thereof to any
circumstance, is held invalid or unenforceable for any reason whatsoever, such
provision shall be severable and shall not affect any other provision hereof or
the application thereof to any other circumstance which can be given effect
without such invalid provision or application. If any provision or term should
be interpreted to be so broad as to be unenforceable, then such terms shall be
restricted as necessary to make such term enforceable to the fullest extent
permitted by law.
6. NOTICE. All notices and all other communications required or permitted
pursuant to this Agreement shall be in writing, and, except as specifically
provided herein, shall be deemed to have been duly given when personally
delivered by courier, or by fax transmission, or when received by United States
certified or registered mail, postage prepaid, addressed to the respective
addresses set forth below:
If to the Company:
Hexcel Corporation
000 Xxxxxxx Xxxxxxxxx
Two Stamford Plaza, 16th Floor
Stamford, CT 6901-3261
Attn: General Counsel
Fax: (000) 000-0000
If to the Employee:
Xxxxxx X. Xxxxx
000 Xxxxxx Xxx
Xxxxxxxx, XX 00000
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The foregoing addresses may be changed by a party giving a notice of such change
as provided in this Section 6.
7. GOVERNING LAW; JURISDICTION; ARBITRATION. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS
OF THE STATE OF CONNECTICUT WITHOUT REFERENCE TO SUCH STATE'S CONFLICT OF LAW
RULES. ALL DISPUTES CONCERNING THE APPLICATION OR ENFORCEMENT OF THE AGREEMENT,
INCLUDING ALL CLAIMS RELATING TO EMPLOYEE'S EMPLOYMENT OR TERMINATION OF
EMPLOYMENT AFTER THE COMMENCEMENT DATE, SHALL, IF NECESSARY, BE RESOLVED BY
FINAL AND BINDING ARBITRATION BEFORE A SINGLE ARBITRATOR SELECTED BY MUTUAL
AGREEMENT OR (FAILING AGREEMENT) SELECTED IN ACCORDANCE WITH THE RULES OF THE
AMERICAN ARBITRATION ASSOCIATION THEN IN EFFECT (THE "ARBITRATOR"). THE
ARBITRATION SHALL OTHERWISE BE CONDUCTED IN STAMFORD, CONNECTICUT, AND IN
ACCORDANCE WITH THE RULES OF THE AMERICAN ARBITRATION ASSOCIATION THEN IN
EFFECT. THE ARBITRATOR SHALL ISSUE A WRITTEN AWARD CONTAINING FINDINGS OF FACT
AND CONCLUSIONS OF LAW, AND IS EMPOWERED TO GRANT ANY LEGAL OR EQUITABLE RELIEF
WHICH THE COURT COULD AWARD HAD THE MATTER BEEN BROUGHT BEFORE IT.
NOTWITHSTANDING THIS AGREEMENT TO ARBITRATE, IN EXIGENT CIRCUMSTANCES, EITHER
PARTY MAY REQUEST AN APPROPRIATE COURT OF LAW FOR TEMPORARY EQUITABLE RELIEF
PENDING THE APPOINTMENT OF, AND AWARD BY, THE ARBITRATOR. ANY AWARD OF THE
ARBITRATOR MAY INCLUDE AN AWARD OF COSTS OF ARBITRATION. THE AWARD OF THE
ARBITRATOR MAY BE ENTERED IN ANY COURT HAVING JURISDICTION.
EMPLOYEE ACKNOWLEDGES AND UNDERSTANDS THAT HE IS WAIVING THE RIGHT TO
ADJUDICATE EMPLOYMENT-RELATED CLAIMS, INCLUDING EMPLOYMENT DISCRIMINATION
CLAIMS, IN A JUDICIAL FORUM AND IS OPTING INSTEAD TO ARBITRATE ALL SUCH CLAIMS.
8. NONDISCLOSURE; NONDISPARAGEMENT. The Employee hereby covenants and
agrees that (i) after the Effective Date, he will not (except as to his personal
representatives or as otherwise required by law) disclose the existence of this
Agreement or the terms and conditions hereof to any other person or entity, and
(ii) he will not make, or cause to be made, any statement, observation, opinion,
or communication (whether oral or written) that disparages the Consolidated
Group, any member thereof, or any of their respective past or present officers,
directors, shareholders or employees, whether concerning his separation from
employment or otherwise or that accuses or implies that any such entity or
person engaged in any wrongful or improper conduct, whether or not related to
the Employee's employment with the Company or the termination of such
employment. Nothing herein shall prevent the Employee from disclosing to a
prospective or existing employer the existence of the limitations imposed on the
Employee by Section 3 hereof. Furthermore, the Company hereby covenants and
agrees that none of the officers of the Company will make, or cause to be made,
any statement, observation, opinion or communication (whether oral or written)
that disparages the Employee, whether
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concerning his separation from employment or otherwise or that accuses or
implies that the Employee engaged in any wrongful or improper conduct, whether
or not related to the Employee's employment with the Company or the termination
of such employment.
9. ENTIRE AGREEMENT. This Agreement (including the Schedules) sets forth
the entire understanding of the parties hereto in respect of the subject matter
hereof and, except as specifically provided herein, supersedes all prior
agreements, promises, covenants, arrangements, communications, representations
or warranties, whether oral or written, by any officer, employee or
representative of any party hereto or its agent or representative; and, except
as specifically provided herein, any prior agreement of the parties hereto in
respect of the subject matter hereof is hereby terminated and cancelled except
as specifically provided herein. No terms, conditions, amendments or
modifications hereto shall be binding unless made in writing and signed by the
parties hereto.
10. NO WAIVER. The failure of the Company or the Employee to insist upon
strict adherence to any term of this Agreement on any occasion shall not be
considered a waiver thereof or deprive that party of the right thereafter to
insist upon strict adherence to that term or any other term of this Agreement.
11. WITHHOLDING BY COMPANY. All payments in cash or by delivery of shares
of stock payable to the Employee pursuant to this Agreement shall be made net of
all applicable withholding and payroll taxes under federal, state and local
laws.
12. TRANSACTIONS IN COMPANY SECURITIES. The Employee covenants and agrees
to comply with all applicable securities laws and all of the Company's policies,
including the Insider Information and Trading Policy, with respect to any
transaction involving any securities of the Company after the date hereof.
13. NON-ADMISSION OF LIABILITY. This Agreement shall not be construed in
any way as an admission by the Company that it has acted wrongfully with respect
to the Employee or any other person.
IN WITNESS WHEREOF, the Company and the Employee have executed this
Agreement as of the date first written above.
HEXCEL CORPORATION
By: /s/ Xxx X. Xxxxxxxx /s/ Xxxxxx X. Xxxxx
------------------------ ---------------------------
Name: Xxx X. Xxxxxxxx Xxxxxx X. Xxxxx
Title: Senior Vice President, Secretary
and General Counsel
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SCHEDULE A
EXISTING AGREEMENTS
EMPLOYMENT AGREEMENTS
a) Employee Confidentiality Agreement dated July 15, 1998 (the "Confidentiality
Agreement")
b) Executive Deferred Compensation and Consulting Agreement dated July 15, 1996
c) Executive Severance Agreement dated February 3, 1999 (the "Severance
Agreement")*
d) Supplemental Executive Retirement Agreement dated May 10, 2000, as amended
by First Amendment to Supplemental Executive Retirement Agreement dated
July, 2001*
EQUITY AGREEMENTS
a) Non-Qualified Option Agreement dated July 15, 1998*
b) 1998 Performance Accelerated Restricted Stock Unit Agreement dated July 15,
1998*
c) Performance Accelerated Stock Option Agreement dated July 15, 1998*
d) Reload Option Agreement dated July 30, 1998*
e) Non-Qualified Option Agreement dated October 13, 1998*
f) 1998 Performance Accelerated Restricted Stock Unit Agreement dated October
13, 1998*
g) Exchange Performance Accelerated Stock Option Agreement dated October 30,
1998*
h) Non-Qualified Option Agreement dated February 3, 1999*
i) 1999 Performance Accelerated Restricted Stock Unit Agreement dated February
3, 1999*
j) Grant of Restricted Stock Units Under the Hexcel Corporation Management
Stock Purchase Plan dated February 3, 1999*
k) Performance Accelerated Restricted Stock Unit Agreement dated December 2,
1999* (2 grants)
l) Employee Option Agreement dated December 2, 1999* (2 grants)
m) Performance Accelerated Restricted Stock Unit Agreement dated December 20,
2000
n) Employee Option Agreement dated December 20, 2000 (50,395 shares @ $11.00)
(the "Special Grant")
o) Employee Option Agreement dated December 20, 2000
p) Grant of Restricted Stock Units under the Hexcel Corporation Management
Stock Purchase Plan, dated February 1, 2001
*As amended by Amendment to Agreements dated October 11, 2000, which Amendment
is as amended by Amendment to Amendment to Agreements dated November 21, 2000
SCHEDULE B
CONSULTING TERMS AND CONDITIONS
(a) CONSULTANT. During the term below, Xxxxxx X. Xxxxx (the "Consultant") shall
be an independent consultant to (and not an employee of) the Consolidated
Group on the terms below.
(b) DUTIES. Duties shall be as assigned by the Chief Executive Officer of the
Company. Consultant has no obligation to provide services on more than 30
working days, reasonable prior notice to Consultant required.
(c) TERM. January 4, 2002 through July 1, 2002.
(d) COMPENSATION. $60,000, payable $10,000 per month on or about the first day
of each month from February 2002 through July 2002. Consultant shall not
accrue any vacation or sick pay, nor be entitled to any other compensation
or benefits in consideration for these services.
(e) EXPENSES; SERVICES. Reasonable business expenses approved in advance shall
be reimbursed pursuant to normal Hexcel policy. The Company will not provide
the Consultant with services, support, space or materials.
(f) INSURANCE. Consultant will carry insurance of the type and amount normally
carried by independent consultants providing similar services to the Company
and shall provide evidence of such insurance on request.
(g) HEXCEL PROPERTY AND PROPRIETARY INFORMATION. The second sentence of
Section 1(a) shall apply to Consolidated Group items developed or otherwise
obtained by Consultant during the term. Section 3(a) shall apply to restrict
disclosure or use of Proprietary Information developed, obtained or received
by Consultant during the term.
(h) OWNERSHIP OF INTELLECTUAL PROPERTY. All trade secrets, know-how,
confidential information, inventions (whether patentable or not),
copyrights, tradenames, information, ideas, devices, improvements, advice or
data and all other results (whether or not evidenced in documentary form,
and including notes, memoranda, reports and findings) created or developed
by Consultant, in whole or in part, arising out of, or related to the duties
performed during the term (collectively "Intellectual Property"), shall be
deemed the sole and exclusive property of the Company created or developed
for and on behalf of the Company in exchange for reasonable compensation
and, where applicable, "works for hire". Consultant assigns to the Company
all right, title and interest in the Intellectual Property, if any.
Consultant shall promptly execute and deliver all documents and do such
other acts as the Company may reasonably request, at the Company's expense,
to transfer to, and to vest and evidence the vesting in, the Company of all
right, title and interest in and to the Intellectual Property.
(i) CONSULTANT UNDERSTANDS AND AGREES THAT THIS SCHEDULE B PROVIDES FOR THE
ENTIRE COMPENSATION TO BE PAID TO CONSULTANT RESULTING FROM THE DUTIES TO BE
PERFORMED BY CONSULTANT ON BEHALF OF THE COMPANY, THAT THE COMPANY'S
LIABILITY FOR COMPENSATION IS LIMITED TO PAYMENT OF THE COMPENSATION
PROVIDED IN THIS SCHEDULE B, AND THAT UNDER NO CIRCUMSTANCES WILL CONSULTANT
BE ELIGIBLE FOR ANY BENEFITS OR RIGHTS UNDER ANY EMPLOYEE BENEFIT PLAN OF
THE COMPANY WITH RESPECT TO THE PERFORMANCE OF HIS CONSULTING DUTIES, EVEN
IF A GOVERNMENT AGENCY OR TAXING AUTHORITY RECHARACTERIZES THE RELATIONSHIP
BETWEEN THE PARTIES AS AN EMPLOYMENT RELATIONSHIP. Consultant agrees to pay
applicable taxes (including self-employment and other similar taxes) which
may arise as a result of the consulting duties.
