Exhibit 10.1

 

TRW AUTOMOTIVE HOLDINGS CORP.

 

CHIEF EXECUTIVE OFFICER
LONG-TERM CASH INCENTIVE AWARD AGREEMENT

 

THIS AGREEMENT is made effective as of                               ,
20         (the “Grant Date”), between TRW Automotive Holdings Corp. (the
“Company”) and                              (the “Participant”).

 

R E C I T A L S:

 

WHEREAS, the Committee has determined that the Participant be granted the  Cash
Award provided for herein pursuant to the terms set forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth,
the parties agree as follows:

 

1.                                      Definitions.  Whenever the following
terms are used in this Agreement, they shall have the meanings set forth below.

 

(a)                                 “409A Change of Control” means a Change of
Control that constitutes a change in ownership or effective control within the
meaning of Section 409A(a)(2)(A)(v) of the Code.

 

(b)                                 “Act” means the Securities Exchange Act of
1934, as amended, or any successor statute thereto and the rules and regulations
promulgated thereunder.

 

(c)                                  “Affiliate” means, with respect to any
Person, any other Person directly or indirectly controlling, controlled by or
under common control with such Person or any other Person designated by the
Committee in which any Person has an interest.

 

(d)                                 “Board” means the Board of Directors of the
Company.

 

(e)                                  “Cash Award” means the long-term cash
incentive award granted pursuant to Section 2 of this Agreement, representing a
contingent right to receive cash payments subject to the vesting and payment
terms set forth herein.

 

(f)                                   “Cause” means “Cause” as defined in the
Employment Agreement.

 

(g)                                  “Change of Control” means,

 

(i)                                     the sale or disposition, in one or a
series of related transactions, of all or substantially all of the assets of the
Company to any Person or Group other than the Permitted Holders,

 

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(ii)                                  any Person or Group, other than the
Permitted Holders, is or becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Act), directly or indirectly, of more than 30%
of the total voting power of the voting stock of the Company (or any entity
which controls the Company) within a 12 month period, including by way of
merger, consolidation, tender or exchange offer, or otherwise,

 

(iii)                               a reorganization, recapitalization, merger
or consolidation (a “Corporate Transaction”) involving the Company, unless
securities representing 70% or more of the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors of the Company or the corporation resulting from such Corporate
Transaction (or the parent of such corporation) are held subsequent to such
transaction by the Person or Persons who were the “beneficial owners” of the
outstanding voting securities entitled to vote generally in the election of
directors of the Company immediately prior to such Corporate Transaction, in
substantially the same proportions as their ownership immediately prior to such
Corporate Transaction, or

 

(iv)                              during any 12-month period, individuals who at
the beginning of such period constituted the Board (together with any new
directors whose election by such Board or whose nomination for election by the
stockholders of the Company was approved by a vote of a majority of the
directors of the Company, then still in office, who were either directors at the
beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
Board then in office.

 

(h)                                 “Code” means the Internal Revenue Code of
1986, as amended, or any successor thereto and the regulations and guidance
promulgated thereunder.

 

(i)                                     “Committee” means the Compensation
Committee of the Board (or a subcommittee thereof), or such other committee of
the Board (including, without limitation, the full Board) to which the Board has
delegated power to act under or pursuant to the provisions of this Agreement.

 

(j)                                    “Disability” means, “disability” as
defined in the Employment Agreement or, if not defined therein, “disability” of
the Participant shall have the meaning ascribed to such term in the Company’s
long-term disability plan or policy, as in effect from time to time.

 

(k)                                 “Employment Agreement” means the written
employment agreement between the Company or any of its Subsidiaries and the
Participant (as the same may be amended, modified or supplemented in accordance
with the terms thereof).

 

(l)                                     “Good Reason” means “Good Reason” as
defined in the Employment Agreement.

 

(m)                             “Group” means “group,” as such term is used for
purposes of Section 13(d) or 14(d) of the Act.

 

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(n)                                 “Permitted Holders” means any and all of an
employee benefit plan (or trust forming a part thereof) maintained by (A) the
Company or (B) any corporation or other Person of which a majority of its voting
power of its voting equity securities or equity interest is owned, directly or
indirectly, by the Company.

 

(o)                                 “Person” means any individual, company,
government or political subdivision, agency or instrumentality of a government,
as the term “person” is used for purposes of Section 13(d) or 14(d) of the Act.

 

(p)                                 “Retirement” means the termination of the
Participant’s employment with the Company and its Subsidiaries (i) at age 60 or
older with 10 years of service, or (ii) at age 65 or older, in either case
provided that the Participant’s employment with the Company and its Subsidiaries
continues for at least six months after the Grant Date.

 

(q)                                 “Service Recipient” means the Company or any
Affiliate of the Company that satisfies the definition of “service recipient”
within the meaning of Treasury Regulation Section 1.409A-1 (or any successor
regulation), with respect to which the person is a “service provider” within the
meaning of such Treasury Regulation Section 1.409A-1 (or any successor
regulation).

 

(r)                                    “Subsidiary” means a subsidiary
corporation, as defined in Section 424(f) of the Code.

 

2.                                      Grant of Cash Award.  The Company hereby
grants to the Participant a Cash Award in the amount of $                    ,
subject to the terms and conditions of this Agreement.

 

3.                                      Vesting and Payment of the Cash Award.

 

(a)                                 In General.  Subject to Sections 3(b),
3(c) and 3(d), the Cash Award shall vest in three installments commencing on the
first anniversary of the Grant Date and continuing on each of the second and
third anniversaries of the Grant Date.  Each installment shall be equal to
one-third of the Cash Award amount specified in Section 2.  Once vested, the
amount of the vested installment shall be payable to the Participant by the
Company as soon as administratively practicable but not later than 30 days after
the applicable vesting date.

 

(b)                                 Termination of Employment.  If the
Participant ceases to be employed by the Company or one of the Company’s
Subsidiaries for any reason, any unvested installment(s) of the Cash Award shall
be immediately and automatically canceled by the Company without any payment or
other consideration and without notice or any other action by the Company;
provided, however, that if (i) the Participant’s employment is terminated due to
death or Disability, the Cash Award installment that is scheduled to vest on the
next anniversary of the Grant Date following such termination pursuant to
Section 3(a) shall vest and become payable as if the Participant remained
employed through such date, but no further Cash Award installment shall vest or
become payable on any anniversary of the Grant Date thereafter, or (ii) the
Participant’s employment is terminated by the Company or one of the Company’s
Subsidiaries without Cause or by the Participant for Good Reason or upon
Retirement by the

 

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Participant, the Cash Award installments shall continue to vest and become
payable according to the schedule set forth in Section 3(a), subject to any
required distribution as may be required under Section 7 of this Agreement.

 

(c)                                  409A Change of Control.  Notwithstanding
the foregoing, if from the date of a 409A Change of Control until the second
anniversary of the 409A Change of Control the Participant’s employment is
terminated (i) due to death or Disability, or (ii) by the Company or one of the
Company’s Subsidiaries without Cause or by the Participant for Good Reason or
Retirement, then a portion of the Cash Award, to the extent not previously
vested, canceled or forfeited in accordance with this Section 3, equal to:

 

(i)                     the installment that would be distributable under
Section 3(b)(i) in the case of a termination due to death or Disability, or

 

(ii)                  the installments that would be distributable under
Section 3(b)(ii) in the case of a termination without Cause, for Good Reason or
due to Retirement,

 

shall immediately vest and become payable as soon as administratively
practicable but not later than 30 days after the vesting date, in full
satisfaction of the Participant’s rights under this Agreement and subject to any
required delay in distribution as may be required under Section 7 of this
Agreement.

 

(d)                                 Cancellation of Cash Award.  Upon the
payment of any installment of the Cash Award in accordance with this Section 3,
a portion of the Cash Award equal to the amount of the installment paid to the
Participant shall be canceled.

 

4.                                      No Right to Continued Employment.  This
Agreement shall not be construed as giving the Participant the right to be
retained in the employ of, or in any consulting relationship to, the Company or
any of its Subsidiaries.  Further, the Company or its Subsidiary may at any time
dismiss the Participant or discontinue any consulting relationship, free from
any liability or any claim under this Agreement, except as otherwise expressly
provided herein.

 

5.                                      Transferability.  Unless otherwise
determined by the Committee, a Cash Award may not be assigned, alienated,
pledged, attached, sold or otherwise transferred or encumbered by the
Participant otherwise than by will or by the laws of descent and distribution,
and any such purported assignment, alienation, pledge, attachment, sale,
transfer or encumbrance shall be void and unenforceable against the Company or
any Affiliate; provided that the designation of a beneficiary shall not
constitute an assignment, alienation, pledge, attachment, sale, transfer or
encumbrance.

 

6.                                      Withholding.  The Company or its
Affiliate shall have the right to withhold from any payment due or transfer made
with respect to the Cash Award or any other compensatory amounts due to the
Participant, any applicable withholding taxes in respect of the Cash Award
and/or any installment thereof and to take such action as may be necessary at
the option of the Company to satisfy all obligations for the payment of such
taxes.

 

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7.                                      Section 409A of the Code. 
Notwithstanding other provisions of this Agreement, this Cash Award shall not be
granted, deferred, accelerated, extended, paid out or modified in a manner that
would result in the imposition of an additional tax under Section 409A of the
Code upon a Participant.  In the event that it is reasonably determined by the
Committee that, as a result of Section 409A of the Code, payments in respect of
the Cash Award granted under this Agreement may not be made at the time
contemplated by the terms of this Agreement without causing the Participant to
be subject to taxation under Section 409A of the Code, the Company will make
such payment on the first day that would not result in the Participant incurring
any tax liability under Section 409A of the Code.  References under this
Agreement to the Participant’s termination of employment shall be deemed to
refer to the date upon which the Participant has experienced a “separation from
service” within the meaning of Section 409A of the Code.  Notwithstanding
anything herein to the contrary, (a) if at the time of the Participant’s
separation from service with any Service Recipient the Participant is a
“specified employee” as defined in Section 409A of the Code, and the deferral of
the commencement of any payments or benefits otherwise payable hereunder as a
result of such separation from service is necessary in order to prevent the
imposition of any accelerated or additional tax under Section 409A of the Code,
then the Company will defer the commencement of the payment of any such payments
or benefits hereunder (without any reduction in such payments or benefits
ultimately paid or provided to the Participant) to the minimum extent necessary
to satisfy Section 409A of the Code until the date that is six months and one
day following the Participant’s separation from service with all Service
Recipients (or the earliest date as is permitted under Section 409A of the
Code), if such payment or benefit is payable upon a termination of employment
and (b) if any other payments of money or other benefits due to the Participant
hereunder would cause the application of an accelerated or additional tax under
Section 409A of the Code, such payments or other benefits shall be deferred, if
deferral will make such payment or other benefits compliant under Section 409A
of the Code, or otherwise such payment or other benefits shall be restructured,
to the minimum extent necessary, in a manner, reasonably determined by the
Committee, that does not cause such an accelerated or additional tax or result
in an additional cost to the Company (without any reduction in such payments or
benefits ultimately paid or provided to the Participant).

 

The Company shall use commercially reasonable efforts to implement the
provisions of this Section 7 in good faith; provided that neither the Company,
the Board, the Committee nor any of the Company’s employees, directors or
representatives shall have any liability to Participants with respect to this
Section 7.

 

8.                                      Notices.  Any notice under this
Agreement shall be addressed to the Company in care of its General Counsel at
the principal executive office of the Company and to the Participant at the
address appearing in the personnel records of the Company for the Participant or
to either party at such other address as either party hereto may hereafter
designate in writing to the other.  Any such notice shall be deemed effective
upon delivery to the addressee.

 

9.                                      Governing Law.  This Agreement shall be
governed by and construed in accordance with the laws of the State of Delaware,
without regard to conflicts of laws.

 

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10.                               Counterparts.  This Agreement may be executed
in any number of counterparts, each of which when so executed shall be deemed to
be an original and all of which taken together shall constitute one and the same
agreement.  Any counterpart or other signature hereupon delivered by facsimile
or electronic image scan shall be deemed for all purposes as constituting good
and valid execution and delivery of this Agreement by such party.

 

11.                               Electronic Delivery.    The Company may, in
its sole discretion, decide to deliver any documents related to the Cash Award
granted under this Agreement or future awards that may be granted by the Company
by electronic means or to request the Participant consent to this Agreement by
electronic means. The Participant hereby consents to receive award documents by
electronic delivery and, if requested, to agree to the terms of this Agreement
through an on-line or electronic system established and maintained by the
Company or another third party designated by the Company.

 

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IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the date first above written.

 

 

 

TRW AUTOMOTIVE HOLDINGS CORP.

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

Its:

 

 

 

 

 

 

 

 

 

Participant

 

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