RETENTION AWARD
AGREEMENT
This Retention
Award Agreement (this “Agreement”), is entered into and
made effective as of February 26, 2009 (the “Effective
Date”), by and between TRW Automotive Inc., a Delaware
corporation (the “Company”), and _________ (the
“Executive”). This Award is granted by the Compensation
Committee of the Company’s Board of Directors (the
“Committee”).
(a) “
Act ” means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder, or
any successor statute thereto.
(b) “
Affiliate ” shall mean, 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.
(c) “
Award ” shall mean the retention award granted
pursuant to this Agreement.
(d) “
Cause ” shall have the meaning given to such term in
the Closing Date Employment Agreement or, if not defined therein or
if there is no such agreement, “Cause” means
(i) such Executive’s continued failure substantially to
perform such Executive’s duties (other than as a result of
total or partial incapacity due to physical or mental illness) for
a period of 10 days following written notice by the Company or
any of its Subsidiaries or Affiliates to the Executive of such
failure, (ii) dishonesty in the performance of the
Executive’s duties, (iii) such Executive’s
conviction of, or plea of nolo contendere to, a crime constituting
(A) a felony under the laws of the United States or any state
thereof or (B) a misdemeanor involving moral turpitude,
(iv) such Executive’s willful malfeasance or willful
misconduct in connection with such Executive’s duties or any
act or omission which is injurious to the financial condition or
business reputation of the Company or any of its Subsidiaries or
Affiliates or (v) such Executive’s breach of any
non-competition, non-solicitation or confidentiality provisions to
which the Executive is subject.
(e) “
Change in Control ” shall mean (A) the sale or
disposition, in one or a series of related transactions, of all or
substantially all of the assets of Holdings or the Company to any
“person” or “group” (as such terms are
defined in Sections 13(d)(3) and 14(d)(2) of the Act) other
than Automotive Investors L.L.C. (“AI”) or any of its
Affiliates, (B) any person or group, other than AI or any of
its Affiliates, is or becomes the “beneficial owner”
(as defined in Rules 13d-3 and 13d-5 under the Act), directly
or indirectly, of more than 50% of the total voting power of the
voting stock of Holdings or the Company , including by way of
merger, consolidation or otherwise and AI or any of its Affiliates
cease to control the Board of Directors
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of Holdings
(the “Holdings Board”) or the Board of Directors of the
Company, (C) any “person” or “group”
(as defined above) other than AI or its Affiliates acquires (or has
acquired during the 12-month period ending on the date of the most
recent acquisition of such person or group) ownership of stock of
Holdings or the Company possessing 30 percent or more of the
total voting power of the stock of Holdings or the Company , as
applicable, or (D) a majority of the members of the Holdings
Board is replaced during any 12-month period by directors whose
appointment or election is not endorsed by a majority of the
members of the Holdings Board, as it was constituted at the
beginning of such 12-month period.
(f) “
Closing Date ” shall mean February 28,
2003.
(g) “
Closing Date Employment Agreement ” shall mean a
written employment agreement between the Company or any of its
Subsidiaries and the Executive which is or was entered into as of
or after the Closing Date (as the same may be amended, modified or
supplemented in accordance with the terms thereof).
(h) “
Code ” shall mean the Internal Revenue Code of 1986,
as amended, or any successor thereto.
(i) “
Disability ” shall have the meaning given such term in
the Closing Date Employment Agreement or, if not defined therein or
if there shall be no such agreement, “disability” of
the Executive shall have the meaning ascribed to such term in the
long-term disability plan or policy maintained by the Company or
one or more members of the Company’s controlled group of
corporations (as defined in Section 1563 of the Code), as in
effect from time to time.
(j) “
Good Reason ” shall have the meaning given to such
term in the Closing Date Employment Agreement.
(k) “
Holdings ” shall mean TRW Automotive Holdings Corp., a
Delaware corporation.
(l) “
NYSE ” shall mean the New York Stock
Exchange.
(m) “
Person ” shall mean any individual, firm, corporation,
partnership, limited liability company, trust, incorporated or
unincorporated association, joint venture, joint stock company,
governmental body or other entity of any kind.
(n) “
Shares ” shall mean shares of the common stock, par
value $0.01 per share, of Holdings.
(o) “
Subsidiary ” shall mean a subsidiary corporation, as
defined in Section 424(f) of the Code.
(p) “
Termination of Employment ” shall mean a separation
from service from the Company and all of its controlled group
members (as defined by Section 1563 of the Code).
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Section 2. Grant of Retention Award. The Company hereby
grants to the Executive an Award of $
, which is subject to the terms and conditions stated in this
Agreement.
Section 3. Vesting Requirements. Except as otherwise
provided in Section 4, the Award shall vest in two
installments (“Tranche A” and “Tranche B”,
respectively), each of which shall be equal to 50% of the Award
amount, as follows:
(a) Tranche
A shall vest on the 18-month anniversary of the Effective Date,
provided the Executive remains continuously employed by the Company
or one of its Subsidiaries or Affiliates through that date;
and
(b) Tranche
B shall vest on the 36-month anniversary of the Effective Date (the
“36-month Vesting Date”), provided:
(i) the
Executive remains continuously employed by the Company or one of
its Subsidiaries or Affiliates through that date; and
(ii) the
closing price of the Shares on the NYSE on any day during the six
months immediately preceding the 36-month Vesting Date is greater
than $10.00 (If at any time the Shares are no longer listed or
traded on the NYSE, the foregoing price shall be calculated in such
manner as may be determined by the Committee in its sole but
reasonable discretion from time to time).
Subject
to Section 4, once the requirements of Section 3 have
been satisfied with respect to either Tranche A or Tranche B, that
tranche shall become vested and shall thereafter be payable in
accordance with Section 5.
Section 4. Effects of Certain Events.
(a)
Death . In the event of the Executive’s death prior to
satisfying the
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