Exhibit 10.10

 

EMPLOYEE OPTION AGREEMENT

under the

Hexcel Corporation 2003 Incentive Stock Plan

 

EMPLOYEE OPTION AGREEMENT, dated as of the Grant Date, by and between the
Optionee and Hexcel Corporation (the “Company”).

 

W I T N E S S E T H:

 

WHEREAS, the Company has adopted the Hexcel Corporation 2003 Incentive Stock
Plan (the “Plan”); and

 

WHEREAS, the Compensation Committee (the “Committee”) of the Board of Directors
of the Company (the “Board”) has determined that it is desirable and in the best
interest of the Company to grant to the Optionee a stock option as an incentive
for the Optionee to advance the interests of the Company;

 

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 IX 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 Company hereby grants to the
Optionee the right and option (the “Option”) to purchase all or any part of the
Option Shares of the Company’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 is the Fair Market Value per share of Common Stock as of the Grant Date.

 

4.             Terms 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.

 

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(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 Company and its Subsidiaries
shall not be considered a termination of employment.  Any change in employment
that does not constitute a “separation from service” within the meaning of
Section 1.409A-1(h) of the Treasury Regulations (or any successor provision)
shall not be considered a termination of employment.  Any change in employment
that does constitute a “separation from service” within the meaning of
Section 1.409A-1(h) of the Treasury Regulations (or any successor provision)
shall be considered a termination of employment.

 

If the Optionee’s employment with the Company 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. If the Optionee’s employment with the Company shall terminate other
than by reason of Retirement (as defined in the last Section hereof), Disability
(as defined in the last Section hereof), death or Cause, 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).  The Option, to the
extent not then vested, shall immediately expire upon such termination.

 

If the Optionee dies or becomes Disabled (A) while employed by the Company or
(B) within 90 days after the termination of his or her employment other than for
Cause or Retirement, the Option shall (I) become fully and immediately vested
and exercisable and (II) remain exercisable for one year from the date of death
or Disability (but not beyond the Term of the Option).

 

If the Optionee’s employment terminates by reason of Retirement, (A) the Option
shall, if not fully vested at the time of such termination, continue to vest in
accordance with Section 4(b) above, and (B) the Option shall expire upon the
earlier to occur of the five-year anniversary date of such Retirement and the
expiration of the Term. If the Optionee dies during the five-year period
immediately following the Retirement of the Optionee, the Options shall
(I) become fully and immediately vested and exercisable and (II) remain
exercisable for the remainder of the five-year period from the date of
Retirement (but not beyond the Term of the Option).

 

(ii)                                  In the event of a Change in Control (as
defined in the last Section hereof), the Option shall immediately become fully
vested and exercisable and 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 two years from the date of such termination of
employment, if, within two years after a Change in Control, (A) the Optionee’s
employment is terminated by the Company other than by reason of Retirement,
Cause, Disability or death or (B) the Optionee terminates the Optionee’s
employment for Good Reason (as defined in the last Section hereof).

 

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(d)         Forfeiture of Option on Certain Conditions.                 Optionee
hereby acknowledges that the Company has given or will give Optionee access to
certain confidential, proprietary or trade secret information, which the Company
considers extremely valuable and which provides the Company with a competitive
advantage in the markets in which the Company develops or sells its products. 
The Optionee further acknowledges that the use of such information by Optionee
other than in furtherance of Optionee’s job responsibilities with the Company
would be extremely detrimental to the Company and would cause immediate and
irreparable harm to the Company.  In exchange for access to such confidential,
proprietary or trade secret information, Optionee hereby agrees as follows:

 

(i)                                     Notwithstanding anything to the contrary
contained in this Agreement, should the Optionee breach the “Protective
Condition” (as defined in Section (ii)), then (A) the Option, to the extent not
previously exercised, shall immediately be cancelled upon such breach, (B) the
Optionee shall immediately deliver to the Company the number of Option Shares
the Optionee received during the 180-day period immediately prior to such breach
and (C) if any Option Shares were sold during the 180-day period immediately
prior to such breach, the Optionee shall immediately deliver to the Company all
proceeds of such sales. “Option Shares” shall mean shares of Common Stock the
Optionee may receive pursuant to this Agreement. The Option Shares and proceeds
to be delivered under clauses (B) and (C) may be reduced to reflect (x) the
exercise price paid by the Optionee in connection with such Option Shares and
(y) the Optionee’s liability for taxes payable on such Option Shares and
proceeds.

 

(ii)                                  “Protective Condition” shall mean that
(A) the Optionee complies with all terms and provisions of any obligation of
confidentiality contained in a written agreement with the Company (or a
Subsidiary) signed by the Optionee, or otherwise imposed on Optionee by
applicable law, and (B) during the time Optionee is employed by the Company (or
a Subsidiary) and for a period of one year after the Optionee’s employment with
the Company (or a Subsidiary) terminates, the Optionee does not engage, in any
capacity, directly or indirectly, including but not limited to as employee,
agent, consultant, manager, executive, owner or stockholder (except as a passive
investor holding less than a 5% equity interest in any enterprise), in any
business enterprise then engaged in competition with the business conducted by
the Company anywhere in the world; provided, however, that the Optionee may be
employed by a competitor of the Company within such one year period so long as
the duties and responsibilities of Optionee’s position with such competitor do
not involve the same or substantially similar duties and responsibilities as
those performed by the Optionee for the Company (or a Subsidiary) in a business
segment of the new employer which competes with the business segment(s) with
which the Optionee worked or had supervisory authority over while employed by
the Company (or a Subsidiary).

 

(iii)                               In the event this clause 4(d) is
unenforceable in the jurisdiction in which the Optionee is employed on the date
hereof, it nevertheless shall be enforceable to the full extent permitted by the
laws of the jurisdiction(s) in which the Optionee engages in any activity
prohibited by this clause 4(d).

 

5.             Adjustment Upon Changes in Capitalization.

 

(a)                                  The aggregate number of Option Shares and
the Purchase Price shall be proportionately adjusted by the Committee for any
increase or decrease in the number of

 

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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 Company, 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 Company.

 

(b)                                 Any adjustment under this Section 5 in the
number of Option Shares and the Purchase Price shall be subject to Section 12
below and 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 Company 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 Company,
or by money transfers or direct account debits to an account designated by the
Company; (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 Company; or
(iv) by any combination of the methods described in (i) through (iii) above.

 

(b)                                 The Company’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, local and other withholding tax,
if any.  The Company or a Subsidiary 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, local or other 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
is void ab initio.  The Option shall not be subject to execution, attachment or
other process.  Notwithstanding the foregoing, the Optionee and, after the death
of the Optionee the estate or any estate beneficiary of 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 or other entities whose only partners or other equity
owners are such family members; provided, however, that no consideration can be
paid for the transfer of the Option and the transferee of the Option must agree
to be subject to all conditions applicable to the Option prior to its transfer.

 

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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.                                                   Issuance of Shares.  Any
shares of Common Stock to be issued to the Optionee under this Employee Option
Agreement may be issued in either certificated form, or in uncertificated form
(via the Direct Registration System or otherwise).

 

10.                                             No Right to Employment.  Nothing
contained herein shall be deemed to confer upon the Optionee any right to remain
as an employee of the Company.

 

11.                                             Section 409A

 

(a)                                  It is intended that this Employee Option
Agreement comply in all respects with the requirements of Sections
409A(a)(2) through (4) of the Code and applicable Treasury Regulations and other
generally applicable guidance issued thereunder (collectively, the “Applicable
Regulations”), and this Employee Option Agreement shall be interpreted for all
purposes in accordance with this intent.

 

(b)                                 Notwithstanding any term or provision of
this Employee Option Agreement (including any term or provision of the Plan
incorporated herein by reference), the parties hereto agree that, from time to
time, the Company may, without prior notice to or consent of the Optionee, amend
this Employee Option Agreement to the extent determined by the Company, in the
exercise of its discretion in good faith, to be necessary or advisable to
prevent the inclusion in the Optionee’s gross income pursuant to the Applicable
Regulations of any compensation intended to be deferred hereunder. The Company
shall notify the Optionee as soon as reasonably practicable of any such
amendment affecting the Optionee.

 

(c)                                  In the event that the amounts payable under
this Employee Option Agreement are subject to any taxes, penalties or interest
under the Applicable Regulations, the Optionee shall be solely liable for the
payment of any such taxes, penalties or interest.

 

12.                                 Modifications; Extensions.

 

(a)                                  Notwithstanding any term or provision of
this Employee Option Agreement (including any term or provision of the Plan
incorporated herein by reference), (i) no Modification shall be made in respect
to the Option if such Modification would result in the Option constituting a
deferral of compensation, and (ii) no Extension shall be made in respect to the
Option if such Extension would result in the Option having an additional
deferral feature from the Grant Date, in each case within the meaning of
applicable Treasury Regulations under Code section 409A.

 

(b)                                 Subject to subsection (d) below, a
“Modification” for purposes of subsection (a) means any change in the terms of
the Option that may provide the Optionee with a direct or indirect reduction in
the Purchase Price of the Option, regardless of whether the Optionee in fact
benefits from the change in terms.

 

(c)                                  Subject to subsection (d) below, an
“Extension” for purposes of subsection (a) means either (i) the provision to the
Optionee of an additional period of

 

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time within which to exercise the Option beyond the time originally prescribed,
or (ii) the conversion or exchange of the Option for a legally binding right to
compensation in a future taxable year, or (iii) the addition of any feature for
the deferral of compensation to the terms of the Option, or (iv) any renewal of
the Option that has the effect of (i) through (iii) above.

 

(d)                                 Notwithstanding subsections (b) and
(c) above, it shall not be a Modification or an Extension, respectively, to
change the terms of an Option in any of the ways or for any of the purposes
provided in applicable Treasury Regulations or other guidance under Section 409A
of the Code as not resulting in a Modification or Extension for purposes of that
section.  In particular, it shall not be an Extension to extend the exercise
period of the Option to a date no later than the earlier of (i) the latest date
upon which the Option could have expired by its original terms under any
circumstances or (ii) the 10th anniversary of the Grant Date.

 

13.           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.

 

14.           Resolution of Disputes.  Any disputes arising under or in
connection with this Employee Option Agreement shall be resolved by binding
arbitration before three arbitrators constituting an Employment Dispute
Tribunal, to be held in Connecticut 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. 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.

 

15.           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 Company, or to the Company, Attention:  Corporate Secretary, or
such other address as the Company may designate in writing to the Optionee.

 

16.           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.

 

17.           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.

 

18.           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.

 

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19.           Definitions.  For purposes of this Employee Option Agreement:

 

(I)                                    “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
Exchange Act;

 

(II)                                “Beneficial Owner” (and variants thereof)
shall have the meaning given in Rule 13d-3 promulgated under the Exchange Act
and, only to the extent such meaning is more restrictive than the meaning given
in Rule 13d-3, the meaning determined in accordance with Section 318(a) of the
Code;

 

(III)                            “Cause” shall have the meaning ascribed to such
term in the Executive Severance Agreement;

 

(IV)                            “Change in Control” shall have the meaning
ascribed to such term in the Executive Severance Agreement;

 

(V)                                “Disability” (or becoming “Disabled”) shall
have the meaning ascribed to such term in the Executive Severance Agreement;

 

(VI)                            “Executive Severance Agreement” shall mean the
Employment Agreement, Employment and Severance Agreement, or Executive Severance
Agreement, as applicable, between the Company and the Optionee, as amended from
time to time;

 

(VII)                        “Good Reason” shall have the meaning ascribed to
such term in the Executive Severance Agreement;

 

(VIII)      “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, only to the extent such meaning is more restrictive than the meaning
given in Section 3(a)(9) of the Exchange Act (as modified as above), the meaning
determined in accordance with Sections 1.409A-3(i)(5)(v)(B), (vi)(D) or
(vii)(C) of the Treasury Regulations (or any successor provisions), as
applicable; and

 

(IX)    “Retirement” shall mean termination of the Optionee’s employment, other
than by reason of death or Cause, either (A) at or after age 65 or (B) at or
after age 55 after five (5) years of employment by the Company (or a Subsidiary
thereof).

 

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Annex A

 

NOTICE OF GRANT

EMPLOYEE STOCK OPTION

HEXCEL CORPORATION 2003 INCENTIVE STOCK PLAN

 

The following employee of Hexcel Corporation, a Delaware corporation 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

 

 

 

 

 

Foreign Sub Plan, if applicable

 

 

 

 

 

Grant Date

 

February 1, 2010

 

 

 

Purchase Price

 

$10.90

 

 

 

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:

 

 

 

Ira J. Krakower

 

 

Sr. Vice President

 

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