Exhibit
10.3(a)


 


Annex I


 


HEXCEL CORPORATION

2003 INCENTIVE STOCK PLAN

As Amended and Restated December 11, 2003


 


I. 
Purpose


 


The
Hexcel Corporation 2003 Incentive Stock Plan (the “Existing Plan”) was approved
by the Board on December 12, 2002 and adopted on March 18, 2003 by
the stockholders of the Corporation as an amendment and restatement of the Old
Incentive Stock Plan and the Old Broad Based Plan (the Old Incentive Stock Plan
together with the Old Broad Based Plan to be collectively referred to as the
“Amended and Restated Plans”).  The
Existing Plan combined the Amended and Restated Plans into one plan and
increased the number of shares available under the Amended and Restated Plans.  Upon the Effective Date, each Award (as
defined in the Amended and Restated Plans) which was outstanding under either
of the Amended and Restated Plans became an Award outstanding under the
Existing Plan, and continued to be subject to the same terms and conditions to
which such Award was subject prior to the adoption of the Existing Plan.


 


This
Amended and Restated Hexcel Corporation 2003 Incentive Stock Plan (this “Plan”)
was approved by the Board on, and became effective on, December 11, 2003.


 


This Plan is
intended to attract, retain and provide incentives to Employees, officers,
Directors and consultants of the Corporation, and to thereby increase overall
stockholders’ value.  This Plan
generally provides for the granting of stock, stock options, stock appreciation
rights, restricted shares, other stock-based awards or any combination of the
foregoing to the eligible participants.


 


II.  Definitions


 


(a)                                  “Award”
includes, without limitation, stock options (including incentive stock options
within the meaning of Section 422(b) of the Code) with or without stock
appreciation rights, dividend equivalent rights, stock awards, restricted share
awards, or other awards that are valued in whole or in part by reference to, or
are otherwise based on, the Common Stock (“other Common Stock-based Awards”),
all on a stand-alone, combination or tandem basis, as described in or granted
under this Plan.


 


(b)                                 “Award
Agreement” means a written agreement setting forth the terms and conditions of
each Award made under this Plan.


 


(c)                                  “Board”
means the Board of Directors of the Corporation.


 


(d)                                 “Code”
means the Internal Revenue Code of 1986, as amended from time to time.


 


(e)                                  “Committee”
means the Compensation Committee of the Board or such other committee of the
Board as may be designated by the Board from time to time to administer this
Plan.


 

















 


(f)                                    “Common
Stock” means the $.01 par value common stock of the Corporation.


 


(g)                                 “Corporation”
means Hexcel Corporation, a Delaware corporation.


 


(h)                                 “Director”
means a member of the Board.


 


(i)                                     “Effective
Date” means March 18, 2003.


 


(j)                                     “Employee”
means an employee of the Corporation or a Subsidiary.


 


(k)                                  “Fair
Market Value” means the closing price for the Common Stock as reported in
publications of general circulation from the New York Stock Exchange
Consolidated Transactions Tape on such date, or, if there were no sales on the
valuation date, on the next preceding date on which such closing price was
recorded; provided, however, that the Committee may specify some other
definition of Fair Market Value in good faith with respect to any particular Award.


 


(l)                                     “Old
Broad Based Plan” means the Hexcel Corporation 1998 Broad Based Incentive Stock
Plan, dated as of February 5, 1998, as amended on February 3, 2000,
February 1, 2001 and January 10, 2002


 


(m)                               “Old
Incentive Stock Plan” means the Hexcel Corporation Incentive Stock Plan, dated
as of February 21, 1996, which Plan was amended and restated
January 30, 1997, further amended on December 10, 1997, further
amended on March 25, 1999, further amended on December 2, 1999, amended
and restated on February 3, 2000, amended and restated on
December 19, 2000, and further amended on January 10, 2002


 


(n)                                 “Participant”
means an Employee, officer, Director or consultant who has been granted an
Award under this Plan.


 


(o)                                 “Subsidiary”
means any corporation or other entity, whether domestic or foreign, in which
the Corporation has or obtains, directly or indirectly, a proprietary interest
of more than 50% by reason of stock ownership or otherwise.


 


III. 
Eligibility


 


Any
Employee, officer, Director or consultant of the Corporation or a Subsidiary
selected by the Committee is eligible to receive an Award pursuant to
Section VI hereof.


 


IV.  Plan Administration


 


(a)                                  Except
as otherwise determined by the Board, this Plan shall be administered by the
Committee.  The Board, or the Committee
to the extent determined by the Board, shall periodically make determinations
with respect to the participation of Employees, officers, Directors and
consultants in this Plan and, except as otherwise required by law or this Plan,
the grant terms of Awards, including vesting schedules, price, restriction or
option period, dividend rights, post-retirement and termination rights, payment
alternatives such as cash, stock, contingent awards or other means of payment
consistent with the purposes of this Plan, and


 


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such other terms and
conditions as the Board or the Committee deems appropriate which shall be
contained in an Award Agreement with respect to a Participant.


 


(b)                                 The
Committee shall have authority to interpret and construe the provisions of this
Plan and any Award Agreement and make determinations pursuant to any Plan
provision or Award Agreement which shall be final and binding on all
persons.  No member of the Committee
shall be liable for any action or determination made in good faith, and the
members shall be entitled to indemnification and reimbursement in the manner
provided in the Corporation’s Certificate of Incorporation, as it may be
amended from time to time.


 


The Committee shall have the authority at the time of the grant of any
Award to provide for the conditions and circumstances under which such Award
shall be forfeited.  The Committee shall
have the authority to accelerate the vesting of any Award and the time at which
any Award becomes exercisable. The Committee shall have the authority to cancel
an Award (with the consent of the Participant holding such Award) on such terms
and conditions as the Committee shall determine.


 


V.  Capital Stock Subject to the Provisions of
this Plan


 


(a)                                  The
capital stock subject to the provisions of this Plan shall be shares of
authorized but unissued Common Stock and shares of Common Stock held as
treasury stock.  Subject to adjustment
in accordance with the provisions of Section XI, and subject to
Section V(c) below, the maximum number of shares of Common Stock that
shall be available for grants of Awards under this Plan shall be 14,233,848,
which, as of the Effective Date, includes (i) 8,483,918 shares of Common Stock
subject to outstanding grants of Awards under this Plan, and (ii) 5,749,930
shares of Common Stock available for future grants of Awards under this Plan.


 


(b)                                 The
grant of a restricted share Award shall be deemed to be equal to the maximum
number of shares which may be issued under the Award.  Awards payable only in cash will not reduce the number of shares
available for Awards granted under this Plan.


 


(c)                                  There
shall be carried forward and be available for Awards under this Plan, in
addition to shares available for grant under paragraph (a) of this
Section V, all of the following: 
(i) shares represented by Awards which are cancelled, forfeited,
surrendered, terminated, paid in cash or expire unexercised; and (ii) the
excess amount of variable Awards which become fixed at less than their maximum
limitations.


 


VI.  Awards Under This Plan


 


As the
Board or Committee may determine, the following types of Awards and other
Common Stock-based Awards may be granted under this Plan on a stand-alone,
combination or tandem basis:


 


(a)                                  Stock
Option.  A right to buy a
specified number of shares of Common Stock at a fixed exercise price during a
specified time, all as the Committee may determine.


 


(b)                                 Incentive
Stock Option.  An Award which
may be granted only to Employees in the form of a stock option which shall
comply with the requirements of Code Section 422 or any successor
section as it may be amended from time to time. The exercise price of any
incentive


 


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stock option shall not be
less than 100% of the Fair Market Value of the Common Stock on the date of
grant of the incentive stock option Award. 
Subject to adjustment in accordance with the provisions of
Section XI, the aggregate number of shares which may be subject to
incentive stock option Awards under this Plan shall not exceed the maximum
number of shares provided in paragraph (a) of Section V above.  To the extent that the aggregate Fair Market
Value of Common Stock with respect to which options intended to be incentive
stock options are exercisable for the first time by any individual during any
calendar year exceeds $100,000, such options shall be treated as options which
are not incentive stock options.


 


(c)                                  Stock
Option in lieu of Compensation Election. 
A right given with respect to a year to a Director, officer or key
Employee to elect to exchange annual retainers, fees or compensation for stock
options.


 


(d)                                 Stock
Appreciation Right.  A right which
may or may not be contained in the grant of a stock option or incentive stock
option to receive the excess of the Fair Market Value of a share of Common
Stock on the date the option is surrendered over the option exercise price or
other specified amount contained in the Award Agreement.


 


(e)                                  Restricted
Shares.  A transfer of Common Stock
to a Participant subject to forfeiture until such restrictions, terms and
conditions as the Committee may determine are fulfilled.


 


(f)                                    Dividend
or Equivalent.  A right to receive
dividends or their equivalent in value in Common Stock, cash or in a
combination of both with respect to any new or previously existing Award.


 


(g)                                 Stock Award.  An unrestricted transfer of ownership of
Common Stock.


 


(h)                                 Other
Stock-Based Awards.  Other
Common Stock-based Awards which are related to or serve a similar function to
those Awards set forth in this Section VI.


 


VII.  Award Agreements


 


Each
Award under this Plan shall be evidenced by an Award Agreement setting forth
the terms and conditions of the Award and executed by the Corporation and
Participant.


 


VIII.  Other Terms and Conditions


 


(a)                                  Assignability.  Unless provided to the contrary in any
Award, no Award shall be assignable or transferable except by will, by the laws
of descent and distribution and during the lifetime of a Participant, the Award
shall be exercisable only by such Participant. 
No Award granted under this Plan shall be subject to execution,
attachment or process.


 


(b)                                 Termination
of Employment or Other Relationship.  The Committee shall determine the disposition of the grant of
each Award in the event of the retirement, disability, death or other
termination of a Participant’s employment or other relationship with the
Corporation or a Subsidiary.


 


(c)                                  Rights as a
Stockholder.  A Participant
shall have no rights as a stockholder with respect to shares covered by an
Award until the date the Participant is the holder of record.  No


 


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adjustment will be made
for dividends or other rights for which the record date is prior to such date.


 


(d)                                 No Obligation
to Exercise.  The grant of an
Award shall impose no obligation upon the Participant to exercise the Award.


 


(e)                                  Payments by
Participants.  The Committee
may determine that Awards for which a payment is due from a Participant may be
payable:  (i) in U.S. dollars by
personal check, bank draft or money order payable to the order of the
Corporation, by money transfers or direct account debits; (ii) through the
delivery or deemed delivery based on attestation to the ownership of shares of
Common Stock with a Fair Market Value equal to the total payment due from the
Participant; (iii) pursuant to a “cashless exercise” program if established by
the Corporation; (iv) by a combination of the methods described in (i) through
(iii) above; or (v) by such other methods as the Committee may deem
appropriate.


 


(f)                                    Withholding.  Except as otherwise provided by the
Committee, (i) the deduction of withholding and any other taxes required by law
will be made from all amounts paid in cash and (ii) in the case of payments of
Awards in shares of Common Stock, the Participant shall be required to pay the
amount of any taxes required to be withheld prior to receipt of such stock, or
alternatively, a number of shares the Fair Market Value of which equals the
amount required to be withheld may be deducted from the payment.


 


(g)                                 Maximum
Awards.  The maximum number of
shares of Common Stock that may be issued to any single Participant pursuant to
options under this Plan is equal to the maximum number of shares provided for
in paragraph (a) of Section V.


 


IX.  Termination, Modification and Amendments


 


(a)                                  The
Committee may at any time terminate this Plan or from time to time make such
modifications or amendments of this Plan as it may deem advisable; provided,
however, that no amendments to this Plan which require stockholder approval
under applicable law, rule or regulation shall become effective unless the same
shall be approved by the requisite vote of the Corporation’s stockholders.


 


(b)                                 No
termination, modification or amendment of this Plan may adversely affect the
rights conferred by an Award without the consent of the recipient thereof.


 


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X.  Recapitalization


 


The
aggregate number of shares of Common Stock as to which Awards may be granted to
Participants, the number of shares thereof covered by each outstanding Award,
and the per share price thereof set forth in each outstanding Award, shall all
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 receipt of consideration
by the Corporation, or other change in corporate or capital structure;
provided, however, that any fractional shares resulting from any such
adjustment shall be eliminated.  The
Committee shall also make the foregoing changes and any other changes,
including changes in the classes of securities or other consideration
available, to the extent it is deemed necessary or desirable to preserve the
intended benefits of this Plan for the Corporation and the Participants in the
event of any other reorganization, recapitalization, merger, consolidation,
spin-off, extraordinary dividend or other distribution or similar transaction.


 


XI.  No Right to Employment


 


No
person shall have any claim or right to be granted an Award, and the grant of
an Award shall not be construed as giving a Participant the right to be
retained in the employ of, or in any other relationship with, the Corporation
or a Subsidiary. Further, the Corporation and each Subsidiary expressly reserve
the right at any time to dismiss a Participant free from any liability, or any
claim under this Plan, except as provided herein or in any Award Agreement
issued hereunder or in any other agreement applicable between a Participant and
the Corporation or a Subsidiary.


 


XII.  Governing Law


 


To the
extent that federal laws do not otherwise control, this Plan shall be construed
in accordance with and governed by the laws of the State of Delaware.


 


XIII.  Savings Clause


 


This
Plan is intended to comply in all aspects with applicable laws and
regulations.  In case any one more of
the provisions of this Plan shall be held invalid, illegal or unenforceable in
any respect under applicable law and regulation, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby and the invalid, illegal or unenforceable provision shall be
deemed null and void; however, to the extent permissible by law, any provision
which could be deemed null and void shall first be construed, interpreted or
revised retroactively to permit this Plan to be construed in compliance with
all applicable laws so as to foster the intent of this Plan.


 


XIV.  Effective Date and Term


 


This
Plan shall be effective as of the Effective Date.


 


This Plan shall terminate on the tenth anniversary
date of the Effective Date.  No Awards
shall be granted after the termination of this Plan.


 


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