AMENDED AND RESTATED EMPLOYMENT AGREEMENT by BE AEROSPACE INC

Exhibit 10.3

 

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this "Agreement") is made as of the 4th day of May, 2012, by and between BE Aerospace, Inc., a Delaware corporation (the "Company"), and Richard M. Sharpe (the "Executive").

RECITALS

WHEREAS, the Executive is employed by the Company subject to that certain Employment Agreement between the Company and the Executive dated May 4, 2009 (the "Prior Agreement");

WHEREAS, the Company and the Executive wish to amend and restate the Prior Agreement in favor of this Agreement;

WHEREAS, the Company wishes to make secure for itself the experience, abilities and services of the Executive and to prevent the loss of such experience, services and abilities;

WHEREAS, concurrently with the execution of this Agreement, the Executive and the Company are entering into the 2012 Proprietary Rights Agreement, which is attached hereto as Exhibit A;

WHEREAS, by virtue of the Executive's position with the Company, the Executive has regular access to and use of the Company's confidential information and trade secrets, and the Company has a legitimate interest in protecting its confidential information and trade secrets by prohibiting the Executive from assisting, whether directly or indirectly, a competitor or competing with the Company for a reasonable period after the termination of the Executive's employment; and

WHEREAS, the Executive has successfully completed drug/substance abuse testing, and the Company has received the results of such testing.

NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto, each intending to be legally bound, do hereby agree as follows:

1.    Employment.  The Company shall employ the Executive, and the Executive shall perform services for and continue in the employment of the Company, for an initial period of two (2) years commencing on May 4, 2012, and ending on May 4, 2014, whereupon the Executive's employment hereunder shall automatically be extended for additional two (2) year periods on and after May 4, 2014, until either the Company or the Executive gives the other party at least thirty (30) days' written notice prior to the then applicable Expiration Date (as defined below) of its or his desire to terminate this Agreement, unless the Executive's employment is terminated earlier pursuant to this Agreement.  For purposes of this Agreement: (a) the term "Employment Period" means the initial two (2) year period and all extensions thereof, if any; and (b) the term "Expiration Date" means May 4 of any even calendar year on or after 2014.

 

2.    Position and Duties.  The Executive shall serve the Company in the capacity of Vice President and General Manager for the Consumables Management Segment of the Company and shall:  (i) be accountable to the President and Chief Operating Officer of the Company; and (ii) have such other powers, duties and responsibilities, consistent with this capacity, as may from time to time be prescribed by the President and Chief Operating Officer of the Company.  The Executive shall perform and discharge, faithfully, diligently and to the best of his ability, such powers, duties and responsibilities.  The Executive shall devote all of his working time and efforts to the business and affairs of the Company.

3.    Compensation.

(a)    Salary.  During the Employment Period, the Executive shall receive a salary (the "Salary") payable at the rate of $416,000.00 per annum.  Such rate may be adjusted from time to time by the President and Chief Operating Officer of the Company; provided, however, that it shall at no time be adjusted below the Salary then in effect.  The Salary shall be payable biweekly or in accordance with the Company's current payroll practices, less all required deductions.  The Salary shall be pro-rated for any period of service less than a full year.

(b)    Incentive Bonus.  During the Employment Period, the Executive may receive a performance bonus of up to ninety (90%) percent of the Salary, as determined by the Compensation Committee of the Company in its sole discretion. The incentive bonus shall be paid in accordance with Company policy, but in no event later than March 15th of the year following the year in which it is earned.

(c)    Expenses.  During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by him on behalf of the Company in accordance with the Company's policies and procedures in effect from time to time.

(d)    Benefits.  During the Employment Period, the Executive shall be entitled to participate in or receive benefits under any life or disability insurance, health, pension, retirement, accident, and other employee benefit plans, programs and arrangements made generally available by the Company to its executives, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements in effect from time to time.  In accordance with the Company's policies in effect from time to time applicable to the Executive, the Executive shall also be entitled to paid vacation in any fiscal year during the Employment Period as well as all paid holidays given by the Company to its employees.

(e)    Automobile.  During the Employment Period, the Executive shall receive an automobile allowance (the "Automobile Allowance")  of $1,100 per month, less applicable taxes, payable in accordance with Company policy, but in no event later than March 15th of the year following the year in which the Automobile Allowance accrued.

 

(f)    Equity Awards.

 

(i)      During the Employment Period, the Executive shall be eligible to participate in the Company's equity incentive plan as determined by the Compensation Committee in its sole discretion.  The timing of the grant, form and amount of the equity awards shall be determined by the Compensation Committee in its sole discretion. The equity awards shall be granted pursuant to and subject to the terms of the Company's 2005 Long-Term Incentive Plan (or any successor plan) and an award agreement to be entered into between the Company and the Executive.

 

(ii)     Notwithstanding any provision in the applicable award documents, and as additional consideration for the Executive's restrictive covenants for the benefit of the Company set forth in Section 5 of this Agreement, the Executive's time-vested equity awards shall, subject to applicable law, accelerate and become immediately vested and unrestricted and, as applicable, become immediately exercisable and remain exercisable through the remainder of their term following the occurrence of any of the following events (the "Accelerated Restricted Stock"): (A) the termination of the Executive's employment without Cause pursuant to Section 4(e); (B) the Executive's termination due to Incapacity pursuant to Section 4(c); (C) the Executive's death; or (D) upon a Change of Control (as defined in Section 4(f)).  Nothing in this Section 3(f)(ii) shall alter the terms of any equity awards subject to performance-based vesting.

4.    Termination and Compensation Thereon.

(a)    Termination Date.  Subject to the terms and conditions of this Agreement, the Executive's employment pursuant to this Agreement may be terminated either by the Executive or the Company at any time and for any reason.  The term "Termination Date" means: (i) if the Executive's employment is terminated by his death, the date of his death; or (ii) if the Executive's employment is terminated for any other reason, the date on which the Executive incurs a Separation from Service (as defined in Section 16(c), below).

(b)    Death.  The Executive's employment hereunder shall terminate upon his death.  In such event, the Company shall, within thirty (30) days following the date of death, pay to such person as the Executive shall have designated in a notice filed with the Company, or, if no such person shall have been designated, to his estate, a lump sum amount equal to the Salary (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.

(c)    Incapacity.  If, in the reasonable judgment of the President and Chief Operating Officer, as a result of the Executive's incapacity due to physical or mental illness, the Executive shall have been absent from his full-time duties as described hereunder for the entire period of six (6) consecutive months ("Incapacity"), the Executive's employment shall terminate at the end of the six (6)-month period.  In such event, upon the Termination Date, the Company shall pay to the Executive a lump sum payment equal to the Salary and Automobile Allowance (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.  The lump sum payment shall be made within sixty (60) days following the Termination Date, provided that prior to the payment date the Executive or his designated appointee signs a waiver and release of claims agreement in the form provided by the Company in its discretion and such waiver and release becomes effective and irrevocable in its entirety prior to such date.  If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant to Sections 4(c) and 4(g).  To the extent not already paid, the Company's obligation to pay the Executive his Salary and benefits shall be reduced if the Executive subsequently takes other employment to the extent of the Executive's salary and benefits from such subsequent employment.  Any dispute between the President and Chief Operating Officer and the Executive with respect to the Executive's Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the President and Chief Operating Officer and the Executive, whose decision shall be binding on all parties.

 

(d)    Termination by the Company for Cause; Resignation by the Executive.

(i)    If the Executive's employment is terminated by the Company for Cause or the Executive resigns his employment for any reason (other than pursuant to Section 4(f)), the Company shall have no further obligations to the Executive hereunder after the Termination Date, except for unpaid Salary and benefits accrued through the Termination Date.

 

(ii)    For purposes of this Agreement, "Cause" means the Executive's:  (A) failure, refusal or neglect to perform and discharge his powers, duties, obligations or responsibilities as an employee of the Company; (B) violation of Company policies; (C) breach of the terms of this Agreement or the 2012 Proprietary Rights Agreement; (D) breach of any fiduciary duties or duties of loyalty the Executive may have because of any position the Executive holds with the Company or any subsidiary or affiliate thereof; (E) conviction of, or plea of nolo contendere to, a felony or any other crime involving the Executive's personal dishonesty or moral turpitude or that could reflect negatively upon the Company or any of its subsidiaries or affiliates; (F) indictment by a grand jury for acts detrimental to the Company's best interests; or (G) engagement in willful misconduct (including any willful violation of federal securities laws), negligence, act of dishonesty, violence or threat of violence, in each case that would reasonably be expected to result in injury to the Company or any of its subsidiaries or affiliates.

(e)    Termination Without Cause.  The Company may terminate the Executive's employment hereunder at any time without Cause.  In such event, the Company shall pay to the Executive a lump sum payment equal to: (i) the Salary payable during the period from the Termination Date through the Expiration Date at the rate in effect on the Termination Date; and (ii) one (1) times the Salary in effect as of the Termination Date ((i) and (ii), collectively, the "Severance Payment").  The