AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT
This Amendment ("Amendment") dated as of September 30, 1999 is between
BE Aerospace, Inc., a Delaware corporation (the "Company") and Thomas P.
McCaffrey (the "Executive"). The parties agree as follows:
1. REFERENCE TO AGREEMENT: DEFINITIONS. Reference is made to an Employment
Agreement dated as of May 29, 1998, as amended by Amendment No. 1 dated as of
November 12, 1998, between the Company and the Executive (the "Agreement").
Terms defined in the Agreement and not otherwise defined herein are used herein
with the meanings so defined.
2. AMENDMENTS TO AGREEMENt. The Agreement is amended as follows, effective
as of the date first written above:
2.1 AMENDMENT TO SECTION 2. Section 2 is hereby amended to read as follows:
"3. TERM. Executive shall provide to the Company services hereunder during
the term of this Agreement which, unless otherwise terminated pursuant to the
provisions of Article 5 hereof, shall be the period ending on the later of (i)
May 28, 2003, or, (ii) three (3) years from any date as of which the term is
being determined (the "Employment Term"). The date on which the Employment Term
ends, including any extensions thereof, is sometimes hereinafter referred to as
the "Expiration Date"."
2.2 AMENDMENT TO SECTION 5(C).Clause (ii) of Section 5(c) is hereby amended
to read as follows:
"(ii) until the Expiration Date, (a) pay to Executive or in
the event of Executive's subsequent death, such person as Executive shall have
designated in a notice filed with the Company, or, if no such person shall have
been designated, to Executive's estate, the highest annual Salary paid to the
Executive prior to the Termination Date, (b) continue to provide Executive with
the medical, dental, disability and life insurance coverage, in the same amounts
and upon the same terms and conditions provided pursuant to Section 4(d) hereof
immediately prior to the Termination Date, and (c) continue to provide the
Executive with the automobile allowance provided pursuant to Section 4(e) hereof
immediately prior to the Termination Date.
2.3 Amendment to Sections 5(e) and 5(f). Sections 5(e) and 5(f) of the
Agreement are hereby amended in their entirety to read as follows:
"5(e) Change of Control.
(i) If a "Change of Control" of the Company occurs during the
Employment Term, and the Executive's employment with the Company is terminated
for any reason (other than by reason of the Executive's death pursuant to
Section 5(b) or incapacity pursuant to Section 5(c) after the Change of Control,
then the Company or its successors in interest shall:
(a) Within thirty (30) days after the Termination Date, pay to the
Executive, (or in the event of Executive's subsequent death, such person as
Executive shall have designated in a notice filed with the Company, or, if no
such person shall have been designated, the Executive's estate) a lump sum
payment equal to the sum of: (1) the unpaid Salary payable to the Executive
through the Expiration Date, (2) the unpaid amount of any bonuses declared to
be payable to the Executive for any fiscal periods of the Company ending prior
to the Termination Date, (3) two (2) times the Salary, determined at the highest
rate that was in effect at any time from the 180 day period preceding the Change
of Control until the Termination Date (the "Highest Salary"), (4) an amount
equal to the aggregate amount of Salary, determined based upon the Highest
Salary, that would have been payable for the period from the Termination Date
through the Expiration Date, and (5) by the amount equal to (x) one-half of the
Executive's Highest Salary multiplied (y) by the number of months from May 1,
1993 to the Termination Date divided by twelve (12), which lump sum shall not be
prorated and shall be paid in addition to the Severance Pay payable pursuant to
Section 5(f), hereof.
(b) until the Expiration Date, provide Executive with continued life
insurance and disability and medical and dental insurance coverage in the same
amounts and upon the same terms and conditions as in effect on his Termination
Date, or if greater, as those provided immediately prior to the Change of
Control, and (d) continue to provide Executive with the automobile allowance
provided pursuant to Section 4(e) hereof as of the Termination Date, or if
greater, as provided immediately prior to the Change in Control;
(c) provide that any stock options granted Executive that would not vest on
or prior to the effective date of the Change of Control shall be exercisable
immediately upon the execution of any agreement that would constitute a Change
in Control (regardless of whether such agreement is consummated), and such stock
options shall continue to be exercisable until the later of their expiration
date or the date on which shares of the Company are no longer traded as such;
and
(d) pay Executive the amount of any Gross-Up Payment payable by the Company
to the Executive under Section 5(h) hereof.
(ii) For purposes of this provision, "Change of Control" means:
(a) the entering into of any agreement relating to a transaction or series
of related transactions involving the ownership of the Company that requires a
shareholder vote for the consummation of such transaction;
(b) Individuals who, as of September 30, 1999 (the "Effective Date")
constitute the Board of Directors of the Company (the "Incumbent Board") cease
for any reason to constitute at least a majority of the Board of Directors of
the Company, provided that any person becoming a director subsequent to the
Effective Date whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board (other than an election or nomination of an
individual whose initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the directors of the
Company, as such terms are used in Rule 14a-11 of Regulation 14A promulgated
under the Securities Exchange Act) shall be, for purposes of this Agreement,
considered as though such person were a member of the Incumbent Board;
(c) the acquisition (other than from the Company) by any person, entity or
"group", within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act, of 25% or more of either the then outstanding shares of the
Company's Common Stock or the combined voting power of the Company's then
outstanding voting securities entitled to vote generally in the election of
directors (hereinafter referred to as the ownership of a "Controlling Interest")
excluding, for this purpose, any acquisitions by (1) the Company or its
subsidiaries, (2) any person, entity or "group" that as of the Effective Date
owns beneficial ownership (within the meaning of Rule 13d-3 promulgated under
the Securities Exchange Act) of a Controlling Interest or (3) any employee
benefit plan of the Company or its subsidiaries; or
(d) The sale or other disposition by the Company of 25% or more of the
value of its assets to any person or entity that is not controlled by the
Company.
(iii) The obligations of the Company pursuant to this Section 5(e) shall
survive any termination of this Agreement or the Executive's employment or any
resignation of such employment by the Executive pursuant to this Section 5(e).
(f) Severance Pay. If the Executive's employment hereunder is terminated
for any reason, other than the Executive's death pursuant to Section 5(b)
hereof, or the Executive's incapacity pursuant to Section 5(c) hereof, then
within thirty (30) days after the Executive's Termination Date, the Company
shall pay to the Executive (or in the event of the Executive's subsequent death,
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 Executive's
estate) a lump sum amount equal to the Executive's annual Salary in effect as of
the Termination Date, which lump sum shall not be pro-rated. The obligations of
the Company pursuant to this Section 5(f) shall survive any termination of this
Agreement or the Executive's employment as aforesaid, and shall be in addition
to any amounts payable to the Executive pursuant to Section 5(e) hereof in the
event of a Change of Control of the Company."
3. Miscellaneous. Except as amended by this Amendment, all terms and
conditions of the Agreement shall remain in full force and effect. This
Amendment may be executed in any number of counterparts which together shall
constitute one instrument, shall be governed by and construed in accordance with
the laws (other than the conflict of laws rules) of the State of Florida and
shall bind and inure to the benefit of the parties hereto and their respective
successors, assigns and heirs.
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands, as of
the date first written above.
Thomas P. McCaffrey
BE AEROSPACE, INC.