Exhibit 10.37(b)
EMPLOYEE OPTION AGREEMENT
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:
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WHEREAS, the Corporation has adopted the Hexcel Corporation Incentive Stock Plan
(the "Plan"); and
WHEREAS, the Corporation and the Optionee have entered into an employment
agreement dated as of July 30, 2001 (the "Employment Agreement"); and
WHEREAS, the 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 defined in such Notice of
Grant shall have the meanings ascribed to them in the Notice of Grant and
capitalized terms used herein (and in the Notice of Grant) and defined in the
Plan shall have the meanings ascribed to them in the Plan. Sections II, IV, and
IX (other than Section IX(b)) - XIV of the Plan are incorporated by reference
and made a part of this Employee Option Agreement, and this Employee Option
Agreement shall be subject to the terms of such Sections of the Plan, as such
Sections of 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) as
if the Option granted herein constituted an Award within the meaning of the
Plan. Notwithstanding the foregoing, this Option is not granted under the Plan.
2. GRANT OF OPTION. 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, 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.
(i) Subject to Sections 4(b)(ii) and 4(c) below, the
Option shall vest and become exercisable in full on
the day immediately preceding the tenth anniversary
of the Grant Date.
(ii) If the Fair Market Value of a share of Common Stock
equals or exceeds $15.75 for 30 consecutive days on
which the Common Stock is traded on the New York
Stock Exchange, then the Option shall vest and become
exercisable with respect to one third (1/3) of the
Option Shares on the day immediately following the
last of such 30 days. If the Fair Market Value of a
share of Common Stock equals or exceeds $21 for 30
consecutive days on which the Common Stock is traded
on the New York Stock Exchange, then the Option shall
vest and become exercisable with respect to two
thirds (2/3) of the Option Shares, including any
portion of the Option that became exercisable
pursuant to the first sentence of this Section
4(b)(ii), on the day immediately following the last
of such 30 days. If the Fair Market Value of a share
of Common Stock equals or exceeds $26.25 for 30
consecutive days on which the Common Stock is traded
on the New York Stock Exchange, then the Option shall
vest and become exercisable in its entirety on the
day immediately following the last of such 30 days.
If the Common Stock is at any time principally traded
on a national securities exchange or national market
system other than the New York Stock Exchange, the
provisions of this Section 4(b)(ii) shall apply
instead to the exchange or system on which the Common
Stock is principally traded.
(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
its Subsidiaries shall not be considered a
termination of employment. If the Optionee's
employment with the Corporation is terminated for
Cause (as defined in the Employment Agreement), the
Option, whether or not then vested, shall be
automatically terminated as of the date of such
termination of
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employment. If the Optionee terminates his employment
with the Corporation other than for Good Reason (as
defined in the Employment Agreement), the Option (to
the extent then vested) may be exercised at any time
within (A) ninety (90) days after such termination if
such termination occurs prior to the fifth
anniversary of the Grant Date or (B) three (3) years
after such termination if such termination occurs on
or after the fifth anniversary of the Grant Date
(but, in either case, not beyond the Term of the
Option). The Option, to the extent not then vested,
shall immediately expire upon such termination of
employment. Except as provided in Section 4(c)(ii)
below, if the Optionee's employment with the
Corporation is terminated for any reason other than
(A) by the Company for Cause or (B) by the Optionee
other than for Good Reason, the Option (to the extent
then vested) may be exercised at any time within one
(1) year after such termination (but not beyond the
Term of the Option). The Option, to the extent not
then vested, shall immediately expire upon such
termination of employment.
(ii) In the event of a Change in Control (as defined in
the Employment Agreement), the Option shall
immediately become fully vested and exercisable and
remain exercisable for its originally scheduled term,
provided that if the Optionee's employment is
terminated, the post-termination periods of
exercisability set forth in Section 4(c)(i) hereof
shall apply, except that the post-termination period
of exercisability shall be extended and the Option
shall remain exercisable for a period of three (3)
years from the date of such termination of
employment, if, within two (2) years after a Change
in Control, (A) the Optionee's employment is
terminated by the Company other than by reason of
Cause, Disability (as defined in the Employment
Agreement) or death or (B) the Optionee terminates
the Optionee's employment for Good Reason.
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.
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(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. Except as provided in this Section 7, 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 shall be
void AB INITIO. The Option shall not be subject to execution, attachment or
other process. Notwithstanding the foregoing, the Optionee shall be permitted to
transfer the Option to members of his or her immediate family (I.E., children,
grandchildren or spouse), trusts for the benefit of such family members, and
partnerships whose only partners are such family members; provided, however,
that no consideration can be paid for the transfer of the Option and the
transferee of the Option shall be subject to all conditions applicable to the
Option prior to its transfer.
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.
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9. NO RIGHT TO EMPLOYMENT. Nothing contained herein shall be deemed to
confer upon the Optionee any right of continued employment for any period by 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 in
accordance with the provisions of Section 17 of the Employment Agreement,
including the provisions for advancement of legal fees of the Optionee.
12. NOTICES. Any notice required or permitted under this Employee Option
Agreement shall be given as provided in Section 13 of the Employment Agreement.
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 may be amended, modified
or changed only by a written instrument executed by the Optionee and the
Corporation. No provision of this Employee Option Agreement may be waived except
by a writing executed and delivered by the party sought to be charged. Any such
written waiver will be effective only with respect to the event or circumstance
described therein and not with respect to any other event or circumstance,
unless such waiver expressly provides to the contrary. This Employee Option
Agreement, including the provisions of the Plan incorporated herein by
reference, and the Employment Agreement 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. ADDITIONAL COVENANTS.
(a) The Corporation shall at all times reserve, out of its
authorized and unissued shares, a number of shares sufficient
to provide for the exercise in full of the Option. All shares
issued upon exercise of the Option shall be duly authorized
and, when issued upon such exercise, shall be (i) validly
issued, fully paid and non-assessable, (ii) registered for
purchase by the Optionee from the Corporation under Federal
and state securities laws and shall remain registered until
the Option has been exercised in full or been terminated and
(iii) listed, or otherwise qualified, for trading in the
United States on each national securities exchange or national
securities market system on which the Common Stock is listed
or qualified.
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(b) The Corporation represents and warrants that (i) it is fully
authorized by its Board or the Committee (and by any person or
body whose action is required) to enter into this Employee
Option Agreement and to perform its obligations under it, (ii)
the execution, delivery and performance of this Employee
Option Agreement by the Corporation does not violate any
applicable law, regulation, order, judgment or decree or any
agreement, plan or corporate governance document of the
Corporation or any agreement among holders of its shares and
(iii) upon execution and delivery of this Employee Option
Agreement by the Corporation and the Optionee, this Employee
Option Agreement shall be the valid and binding obligation of
the Corporation, enforceable in accordance with its terms,
except to the extent enforceability may be limited by
applicable bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally or by the
inapplicability of equitable remedies in certain
circumstances.
(c) This Stock Option Agreement shall inure to the benefit of and
be binding upon the Corporation and its successors. It shall
not be assignable except in connection with the sale or other
disposition of all or substantially all of the assets or
business of the Corporation, whether by merger, consolidation
or otherwise.
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ANNEX A
NOTICE OF GRANT
EMPLOYEE STOCK OPTION
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 Xxxxx X. Xxxxxx
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Address of Optionee c/o Hexcel Corporation
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Employee Number
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Employee ID Number
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Foreign Sub Plan, if applicable
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Grant Date July 30, 2001
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Purchase Price the greater of (1) $10.50 and (2) the Fair
Market Value of a share of Common
Stock on the Grant Date
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Aggregate Number of Shares 275,000
Granted (the "Option Shares")
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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.
/s/ Xxxxx X. Xxxxxx HEXCEL CORPORATION
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Xxxxx X. Xxxxxx
By: /s/ Xxx X. Xxxxxxxx
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Xxx X. Xxxxxxxx
Xx. Vice President
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