Exhibit 10.2

 

RESTRICTED STOCK UNIT AGREEMENT

for

Non-Employee Directors

 

RESTRICTED STOCK UNIT AGREEMENT (this “Agreement”), dated as of the Grant Date,
by and between the Grantee and Hexcel Corporation (the “Corporation”).

 

W I T N E S S E T H:

 

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

 

WHEREAS, the Board of Directors of the Corporation (the “Board”) has determined
that it is desirable and in the best interests of the Corporation to grant to
the Grantee restricted stock units (“RSUs”) as an incentive for the Grantee to
advance the interests of the Corporation.

 

NOW, THEREFORE, the parties agree as follows:

 

1.       Notice of Grant; Incorporation of Plan.  Pursuant to the Plan and
subject to the terms and conditions set forth herein and therein, the
Corporation hereby grants to the Grantee the number of RSUs indicated on the
Notice of Grant attached hereto as Annex A, which Notice of Grant is
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 Agreement, and this
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 RSUs granted herein constitute an
Award within the meaning of the Plan.

 

2.       Terms of Restricted Stock Units.  The grant of RSUs provided in
Section 1 hereof shall be subject to the following terms, conditions and
restrictions:

 

(a)       No Ownership.             The Grantee shall not possess any incidents
of ownership (including, without limitation, dividend and voting rights) in
shares of the Common Stock in respect of the RSUs until such RSUs have vested
and been distributed to the Grantee in the form of shares of Common Stock.

 

(b)       Transfer of RSUs.        Except as provided in this Section 2(b), the
RSUs and any interest therein may not be sold, assigned, transferred, pledged,
hypothecated or otherwise disposed of, except by will or the laws of descent and
distribution and subject to the conditions set forth in the Plan and this
Agreement. Any attempt to transfer RSUs in contravention of this Section is void
ab initio. RSUs shall not be subject to execution, attachment or other process.
Notwithstanding the foregoing, the

 

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Grantee shall be permitted to transfer RSUs 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 equity
owners are such family members; provided, however, that no consideration can be
paid for the transfer of the RSUs and the transferee of the RSUs must agree to
be subject to all conditions applicable to the RSUs (including all of the terms
and conditions of this Agreement) prior to transfer.

 

(c)       Vesting and Conversion of RSUs.  Subject to Sections 2(d) and 2(e),
the RSUs shall vest daily in proportion to the time elapsed between the Grant
Date and the first anniversary of the Grant Date, and shall be converted into an
equivalent number of shares of Common Stock that will be immediately distributed
to the Grantee on the first anniversary of the Grant Date; provided that if the
Grantee has delivered to the Corporation, on or prior to the Required Date, an
irrevocable written election to defer conversion of the RSUs until such time as
the Grantee separates from service with the Corporation, then the RSUs will be
converted into an equivalent number of shares of Common Stock that will be
immediately distributed to the Grantee on the date on which the Grantee
separates from service with the Corporation. Upon distribution of the shares of
Common Stock in respect of the RSUs, the Corporation shall issue to the Grantee
or the Grantee’s personal representative a stock certificate representing such
shares of Common Stock, free of any restrictions.  “Required Date” shall mean
(i) if this grant of RSUs is issued in connection with the Grantee’s initial
election to the Board of Directors, the Date of Grant; and (ii) otherwise,
December 31 of the calendar year prior to the calendar year in which the grant
occurs.

 

(d)       Separation from Service.

 

(i)        If the Grantee separates from service with the Corporation for any
reason other than death, disability or Cause, then (A) all RSUs that have vested
on or prior to the date the Grantee separated from service with the Corporation
shall be converted into an equivalent number of shares of Common Stock and
immediately distributed to the Grantee, and (B) the Grantee shall forfeit all
RSUs which have not yet become vested as of the date the Grantee separated from
service with the Corporation.

 

(ii)       In the event the Grantee dies or the Grantee separates from service
with the Corporation because of disability, all RSUs shall vest, be converted
into an equivalent number of shares of Common Stock and be immediately
distributed to the Grantee.

 

(iii)      In the event the Grantee separates from service with the Corporation
for Cause, then the Grantee shall forfeit all RSUs, whether or not vested.

 

(iv)      “Separation from service” (and variations thereof) shall, for all
purposes of this Agreement, have the meaning given in Section 1.409A-1(h) of the
Treasury Regulations (or any successor provision).

 

(e)   Change of Control.  In the event of a Change in Control (as defined below)
or of the termination of this Agreement within twelve months of a complete
liquidation or dissolution of the Corporation that is taxed under Section 331 of
the Code, all RSUs shall vest, be converted into shares of Common Stock and be
immediately distributed to the Grantee or (in the event of a

 

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complete liquidation or dissolution of the Corporation) as soon as
administratively practicable thereafter.

 

(f)    Specified Employee.  Notwithstanding anything in sections 2(c), 2(d) or
6(b) to the contrary, if after the Date of Grant the Grantee subsequently
becomes an employee of the Corporation and is a “specified employee” within the
meaning of Section 409A(a)(2)(B)(i) of the Internal Revenue Code of 1986, as
amended (the “Code”) as of the date of his or her separation from service with
the Corporation, then no RSUs convertible on account of the Grantee’s separation
from service shall be converted into shares of Common Stock or distributed to
the Grantee, and no costs for which the Grantee may be entitled to reimbursement
under Section 6(b) shall be reimbursed, until the earlier of (i) the date which
is six months after the date of the Grantee’s separation from service and
(ii) the date of the Grantee’s death.

 

3.         Equitable Adjustment.            The aggregate number of shares of
Common Stock subject to the RSUs shall be proportionately adjusted 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 the 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 Agreement in the event of any other
reorganization, recapitalization, merger, consolidation, spin-off, extraordinary
dividend or other distribution or similar transaction involving the Corporation.

 

4.         Taxes.  The Grantee shall pay to the Corporation promptly upon
request any taxes the Corporation reasonably determines it is required to
withhold under applicable tax laws with respect to the RSUs.  Such payment shall
be made as provided in Section VIII(f) of the Plan.

 

5.         No Right to Continued Service as Director.  Nothing contained herein
shall be deemed to confer upon the Grantee any right to continue to serve as a
member of the Board.

 

6.         Miscellaneous

 

(a)          Governing Law/Jurisdiction.  This 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.

 

(b)         Resolution of Disputes.  Any disputes arising under or in connection
with this Agreement shall be resolved by binding arbitration before a single
arbitrator, to be held in New York in accordance with the commercial rules and
procedures of the American Arbitration Association. Judgment upon the award
rendered by the arbitrator shall be final and subject to appeal only to the
extent permitted by law. Each party shall bear such party’s own expenses
incurred in connection with any arbitration; provided, however, that the cost of
the arbitration, including without limitation, reasonable attorneys’ fees of the
Grantee, shall be borne by the Corporation in the event the Grantee is the
prevailing party in the arbitration. Anything to the contrary notwithstanding,
each party hereto has the right to proceed with a court action for injunctive
relief or relief from violations of law not

 

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within the jurisdiction of an arbitrator.  If any costs of the arbitration borne
by the Corporation in accordance herewith would constitute compensation to the
Grantee for Federal tax purposes, then the amount of any such costs reimbursed
to the Grantee in one taxable year shall not affect the amount of such costs
reimbursable to the Grantee in any other taxable year, the Grantee’s right to
reimbursement of any such costs shall not be subject to liquidation or exchange
for any other benefit, and the reimbursement of any such costs incurred by the
Grantee shall be made as soon as administratively practicable, but in any event
within ten (10) days, after the date the Grantee is determined to be the
prevailing party in the arbitration.  The Grantee shall be responsible for
submitting claims for reimbursement in a timely manner to enable payment within
the timeframe provided herein.

 

(c)          Notices.  Any notice required or permitted under this Agreement
shall be deemed given when delivered personally, or when deposited in a United
States Post Office, postage prepaid, addressed, as appropriate, to the Grantee
at the last address specified in Grantee’s records with the Corporation, or such
other address as the Grantee may designate in writing to the Corporation, or to
the Corporation, Attention:  Corporate Secretary, or such other address as the
Corporation may designate in writing to the Grantee.

 

(d)         Failure to Enforce Not a Waiver.  The failure of either party hereto
to enforce at any time any provision of this Agreement shall in no way be
construed to be a waiver of such provision or of any other provision hereof.

 

(e)          Counterparts.  This 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.

 

(f)            Modifications; Entire Agreement; Headings.  This Agreement cannot
be changed or terminated orally. This 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.

 

7.         Section 409A.

 

(a)                      It is intended that this Restricted Stock Unit
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 Restricted Stock Unit Agreement shall be interpreted for
all purposes in accordance with this intent.

 

(b)                     Notwithstanding any term or provision of this Restricted
Stock Unit Agreement (including any term or provision of the Plan incorporated
herein by reference), the parties hereto agree that, from time to time, the
Corporation may, without prior notice to or consent of the Grantee, amend this
Restricted Stock Unit Agreement to the extent determined by the Corporation, in
the exercise of its discretion in good faith, to be necessary or advisable to
prevent the inclusion in the Grantee’s gross income pursuant to the Applicable
Regulations of any

 

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compensation intended to be deferred hereunder. The Corporation shall notify the
Grantee as soon as reasonably practicable of any such amendment affecting the
Grantee.

 

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

 

(d)                     Except as otherwise specifically provided herein, the
time for distribution of the RSUs as provided in Section 2 shall not be
accelerated or delayed for any reason, unless to the extent necessary to comply
with or permitted under the Applicable Regulations.

 

8.         Definitions.               For purposes of this 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)                A director will be deemed to separate from service with the
Corporation for “Cause” if such separation is due to his fraud, dishonesty or
intentional misrepresentation in connection with his duties as a Director or his
embezzlement, misappropriation or conversion of assets or opportunities of the
Corporation or any Subsidiary.

 

(IV)                “Change in Control” shall mean any of the following events:

 

(i)         any Person is or becomes the Beneficial Owner, directly or
indirectly, of more than 50% of either (A) the combined fair market value of the
then outstanding stock of the Corporation (the “Total Fair Market Value”) or
(B) the combined voting power of the then outstanding securities entitled to
vote generally in the election of directors of the Corporation (the “Total
Voting Power”); excluding, however, the following: (a) any acquisition by the
Corporation or any of its Controlled Affiliates, (b) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the
Corporation or any of its Controlled Affiliates, (c) any Person who becomes such
a Beneficial Owner in connection with a transaction described in the exclusion
within paragraph (iv) below and (d) any acquisition of additional stock or
securities by a Person who owns more than 50% of the Total Fair Market Value or
Total Voting Power of the Corporation immediately prior to such acquisition; or

 

(ii)        any Person is or becomes the Beneficial Owner, directly or
Indirectly, of securities of the Corporation that, together with any securities

 

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acquired directly or indirectly by such Person within the immediately preceding
twelve-consecutive month period, represent 40% or more of the Total Voting Power
of the Corporation; excluding, however, any acquisition described in subclauses
(a) through (d) of subsection (i) above; or

 

(iii)      a change in the composition of the Board such that the individuals
who, as of the effective date of this Agreement, constitute the Board (such
individuals shall be hereinafter referred to as the “Incumbent Directors”) cease
for any reason to constitute at least a majority of the Board; provided,
however, for purposes of this definition, that any individual who becomes a
director subsequent to such effective date, whose election, or nomination for
election by the Corporation’s stockholders, was made or approved by a vote of at
least a majority of the Incumbent Directors (or directors whose election or
nomination for election was previously so approved) shall be considered an
Incumbent Director; but, provided, further, that any such individual whose
initial assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of Regulation
14A promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a person or legal entity
other than the Board shall not be considered an Incumbent Director; provided
finally, however, that, as of any time, any member of the Board who has been a
director for at least twelve consecutive months immediately prior to such time
shall be considered an Incumbent Director for purposes of this definition, other
than for the purpose of the first proviso of this definition; or

 

(iv)      there is consummated a merger or consolidation of the Corporation or
any direct or indirect Subsidiary of the Corporation or a sale or other
disposition of all or substantially all of the assets of the Corporation
(“Corporate Transaction”); excluding, however, such a Corporate Transaction
(A) pursuant to which all or substantially all of the individuals and entities
who are the Beneficial Owners, respectively, of the outstanding Common Stock of
the Corporation and Total Voting Power immediately prior to such Corporate
Transaction will Beneficially Own, directly or indirectly, more than 50%,
respectively, of the outstanding common stock and the combined voting power of
the  then outstanding common stock and the combined voting power of the then
outstanding securities entitled to vote generally in the election of directors
of the company resulting from such Corporate Transaction (including, without
limitation, a company which as a result of such transaction owns the Corporation
or all or substantially all of the Corporation’s assets either directly or
through one or more subsidiaries) in substantially the same proportions as their
ownership immediately prior to such Corporate Transaction of the Outstanding
Common Stock and Total Voting Power, as the case may be, and (B) immediately
following which the individuals who comprise the Board immediately prior thereto
constitute at least a majority of the board of directors of the company
resulting from such Corporate Transaction (including, without limitation, a
company which as a result of such

 

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transaction owns the Corporation or all or substantially all of the
Corporation’s assets either directly or through one or more subsidiaries);

 

provided, however, that notwithstanding anything to the contrary in subsections
(i) through (iv) above, an event which does not constitute a change in the
ownership of the Corporation, a change in the effective control of the
Corporation, or a change in the ownership of a substantial portion of the assets
of the Corporation, each as defined in Section 1.409A-3(i)(5) of the Treasury
Regulations (or any successor provision), shall not be considered a Change in
Control for purposes of this Agreement.

 

(V)                    “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.

 

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ANNEX A

 

NOTICE OF GRANT

RESTRICTED STOCK UNIT AGREEMENT

HEXCEL CORPORATION 2003 INCENTIVE STOCK PLAN

 

The following member of the Board of Directors of Hexcel Corporation, a Delaware
corporation (“Hexcel”), has been granted Restricted Stock Units in accordance
with the terms of this Notice of Grant and the Restricted Stock Unit Agreement
to which this Notice of Grant is attached.

 

The terms below shall have the meanings ascribed to them below when used in the
Restricted Stock Unit Agreement.

 

Grantee

 

Address of Grantee

 

Grant Date

 

Aggregate Number of RSUs Granted

 

IN WITNESS WHEREOF, the parties hereby agree to the terms of this Notice of
Grant and the Restricted Stock Unit Agreement to which this Notice of Grant is
attached and execute this Notice of Grant and Restricted Stock Unit Agreement as
of the Grant Date.

 

 

 

 

 

 

 

 

HEXCEL CORPORATION

Grantee

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

Ira J. Krakower

 

 

Senior Vice President

 

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