<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 18, 1996
REGISTRATION NO. 33-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------------
LEAR CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 13-3386776
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
21557 TELEGRAPH ROAD 48034
SOUTHFIELD, MICHIGAN (zip code)
(Address of principal executive offices)
</TABLE>
MASLAND CORPORATION 1993 STOCK OPTION INCENTIVE PLAN
MASLAND HOLDINGS, INC. 1991 STOCK PURCHASE AND OPTION PLAN
(Full title of the Plans)
------------------------------
JAMES H. VANDENBERGHE
EXECUTIVE VICE PRESIDENT
LEAR CORPORATION
21557 TELEGRAPH ROAD
SOUTHFIELD, MICHIGAN 48034
(Name and address of agent for service)
(810) 746-1500
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
TO BE REGISTERED(1) REGISTERED(1) PER SHARE(2) OFFERING PRICE(2) REGISTRATION FEE
- -------------------------------------------------------------------------------------------------
Common Stock, $.01 par
value................ 1,442,764 shares $37.8125 $54,554,514 $18,811.90
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to Rule 416, this Registration Statement shall be deemed to cover
any additional shares of Common Stock which may be issuable pursuant to the
antidilution provisions of the Masland Corporation 1993 Stock Option
Incentive Plan and the Masland Holdings, Inc. 1991 Stock Purchase and Option
Plan.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) on the basis of the average high and low prices reported on
the New York Stock Exchange Composite Tape on June 13, 1996.
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- --------------------------------------------------------------------------------
<PAGE> 2
PART I
INFORMATION REQUIRED IN SECTION 10(A) PROSPECTUS
The document(s) containing the information specified in Part I of Form S-8
will be sent or given to participating employees as specified by Rule 428(b)(1)
of the Securities Act of 1933, as amended (the "Securities Act"). Such documents
are not being filed with or included in this Form S-8 (by incorporation by
reference or otherwise) in accordance with the rules and regulations of the
Securities and Exchange Commission (the "SEC"). These documents and the
documents incorporated by reference into this Registration Statement pursuant to
Item 3 of Part II of this Registration Statement, taken together, constitute a
prospectus that meets the requirements of Section 10(a) of the Securities Act.
I-1
<PAGE> 3
PART II
INFORMATION REQUIRED IN THIS REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
Lear Corporation (the "Registrant") hereby incorporates the following
documents herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995;
(b) The Registrant's Quarterly Report on Form 10-Q for the period
ended March 30, 1996;
(c) The Registrant's Current Report on Form 8-K filed on May 22, 1996;
(d) All other reports filed by the Registrant pursuant to Sections
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), on or after December 31, 1995; and
(e) The Registrant's Registration Statement on Form 8-A filed on April
1, 1994, as amended by Amendment No. 1 on Form 8-A/A filed on
April 5, 1994.
In addition, all documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this
Registration Statement and prior to the filing of a post-effective amendment to
this Registration Statement which indicates that all securities offered hereby
have been sold or which deregisters all such securities then remaining unsold
shall be deemed to be incorporated herein by reference and to be a part hereof
from the date of filing of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
None.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
As authorized by Section 145 of the General Corporation Law of Delaware
(the "Delaware Corporation Law"), each director and officer of the Registrant
may be indemnified by the Registrant against expenses (including attorney's
fees, judgments, fines and amounts paid in settlement) actually and reasonably
incurred in connection with the defense or settlement of any threatened, pending
or completed legal proceedings in which he is involved by reason of the fact
that he is or was a director or officer of the Registrant if he acted in good
faith and in a manner that he reasonably believed to be in or not opposed to the
best interests of the Registrant, and, with respect to any criminal action or
proceeding, if he had no reasonable cause to believe that his conduct was
unlawful. If the legal proceeding, however, is by or in the right of the
Registrant, the director or officer may not be indemnified in respect to any
claim, issue or matters as to which he shall have been adjudged to be liable for
negligence or misconduct in the performance of his duty to the Registrant unless
a court determines otherwise.
Article Five of the Restated Certificate of Incorporation of the Registrant
provides that no director of the Registrant shall be personally liable to the
Registrant or its stockholders for monetary damages for any breach of his
fiduciary duty as a director; provided, however, that such clause shall not
apply to any liability of a director (1) for any breach of his duty of loyalty
to the Registrant or its stockholders, (2) for acts or omissions
II-1
<PAGE> 4
that are not in good faith or involve intentional misconduct or a knowing
violation of the law, (3) under Section 174 of the Delaware Corporation Law, or
(4) for any transaction from which the director derived an improper personal
benefit. In addition, Article Six of the Restated Certificate of Incorporation
of the Registrant and Article VIII of the Amended and Restated By-Laws of the
Registrant provide for the indemnification of the Registrant's directors and
officers.
The Registrant maintains directors and officers liability insurance that
insures the directors and officers of the Registrant against certain
liabilities. In addition, Lehman Brothers Inc. has agreed to indemnify David P.
Spalding, James A. Stern and Alan H. Washkowitz, each being a director of the
Registrant, in connection with their service as directors of the Registrant.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
<TABLE>
<C> <S>
4.1 Masland Corporation 1993 Stock Option Incentive Plan
4.2 Masland Holdings, Inc. 1991 Stock Purchase and Option Plan
4.3 Form of Option Assumption Agreement
4.4 Form of Option Cancellation Agreement
4.5 Form of certificate for the Registrant's Common Stock, par value $.01 per share
(filed as Exhibit 4.5 to the Registrant's Registration Statement on Form S-8 (No.
33-55783) and incorporated herein by reference)
5.1 Opinion of Winston & Strawn as to the legality of the securities being registered
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Winston & Strawn (included in their opinion filed as Exhibit 5.1)
24.1 Powers of Attorney (included on the signature page hereof)
</TABLE>
II-2
<PAGE> 5
ITEM 9. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made of the securities registered hereby, a post-effective amendment to
this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration
Statement or any material change to such information in this
Registration Statement; provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) of this section do not apply if the registration statement is
on Form S-3, Form S-8 or Form F-3, and the information required to be
included in a post-effective amendment by those paragraphs is contained
in periodic reports filed with or furnished to the SEC by the Registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby further undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of the annual report of the
employee benefit plans pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the SEC such indemnification
is against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the undersigned
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Southfield, Michigan on the 17th day of June, 1996.
LEAR CORPORATION
By: /s/ KENNETH L. WAY
------------------------------------
Kenneth L. Way
Chairman of the Board and
Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Kenneth L. Way, Robert E. Rossiter and James H.
Vandenberghe and each of them (with full power to each of them to act alone),
his true and lawful attorney-in-fact and agent, with full power of substitution
and resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all said attorneys-in-fact and agents, or any of them, or their
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ---------------------------------------- ------------------------------------- -------------
<C> <S> <C>
/s/ KENNETH L. WAY Chairman of the Board and June 17, 1996
- ---------------------------------------- Chief Executive Officer
Kenneth L. Way (Principal Executive Officer)
/s/ ROBERT E. ROSSITER President, Chief Operating June 17, 1996
- ---------------------------------------- Officer and Director
Robert E. Rossiter
/s/ JAMES H. VANDENBERGHE Executive Vice President, Chief June 17, 1996
- ---------------------------------------- Financial Officer and Director
James H. Vandenberghe (Principal Financial and Principal
Accounting Officer)
/s/ LARRY W. MCCURDY Director June 17, 1996
- ----------------------------------------
Larry W. McCurdy
/s/ GIAN ANDREA BOTTA Director June 17, 1996
- ----------------------------------------
Gian Andrea Botta
/s/ ROBERT W. SHOWER Director June 17, 1996
- ----------------------------------------
Robert W. Shower
</TABLE>
II-4
<PAGE> 7
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ---------------------------------------- ------------------------------------- -------------
<C> <S> <C>
/s/ DAVID P. SPALDING Director June 17, 1996
- ----------------------------------------
David P. Spalding
/s/ JAMES A. STERN Director June 17, 1996
- ----------------------------------------
James A. Stern
/s/ ALAN WASHKOWITZ Director June 17, 1996
- ----------------------------------------
Alan Washkowitz
</TABLE>
II-5
<PAGE> 8
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ------ -------------------------------------------------------------------------- ----------
<C> <S> <C>
4.1 Masland Corporation 1993 Stock Option Incentive Plan
4.2 Masland Holdings, Inc. 1991 Stock Purchase and Option Plan
4.3 Form of Option Assumption Agreement
4.4 Form of Option Cancellation Agreement
4.5 Form of certificate for the Registrant's Common Stock, par value $.01 per
share (filed as Exhibit 4.5 to the Registrant's Registration Statement on
Form S-8 (No. 33-55783) and incorporated herein by reference)
5.1 Opinion of Winston & Strawn as to the legality of the securities being
registered
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Winston & Strawn (included in their opinion filed as Exhibit
5.1)
24.1 Powers of Attorney (included on the signature page hereof)
</TABLE>
<PAGE> 1
EXHIBIT 4.1
MASLAND CORPORATION
1993 STOCK OPTION INCENTIVE PLAN
ARTICLE 1.
ESTABLISHMENT AND PURPOSE
1.1 Establishment and Effective Date. Masland Corporation, a Delaware
Corporation (the "Corporation"), hereby establishes a stock incentive plan to
be known as the Masland Corporation 1993 Stock Option Incentive Plan (the
"Plan"). The Plan was adopted by the Board of Directors on October 25, 1993,
was approved by the Company's stockholders on October 25, 1993, and became
effective on the later date. Upon approval by the Board of Directors of the
Corporation (the "Board"), awards may be made as provided herein, subject to
subsequent stockholder approval. In the event that such stockholder approval is
not obtained, any such awards shall be cancelled and all rights of associates
with respect to such awards shall thereupon cease.
1.2 Purpose. The Corporation desires to attract and retain the best
available executive and key management associates for itself and its
subsidiaries and to encourage the highest level of performance by such
associates in order to serve the best interests of the Corporation and its
stockholders. The Plan is expected to contribute to the attainment of these
objectives by offering eligible associates the opportunity to acquire stock
ownership interests in the Corporation, and other rights enabling them to share
in appreciation in value of the stock of the Corporation, thereby providing
them with incentives to put forth maximum efforts for the success of the
Corporation and its subsidiaries.
ARTICLE 2.
AWARDS
2.1 Form of Awards. Awards under the Plan may be granted in any one
or more of the following forms: (i) incentive stock options ("Incentive Stock
Options") meeting the requirements of Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code"); (ii) nonstatutory stock options
("Nonstatutory Stock Options") (unless otherwise indicated, references in the
Plan to Options shall include both Incentive Stock Options and Nonstatutory
Stock Options); and (iii) stock appreciation rights ("Stock Appreciation
Rights"), which may be awarded either in tandem with Options ("Tandem Stock
Appreciation Rights") or on a stand-alone basis ("Nontandem Stock Appreciation
Rights").
2.2 Maximum Shares Available. The maximum aggregate number of shares
of Common Stock available for award under the Plan is 500,000, increased by any
unused shares available for grant on the effective date of the Plan under the
Corporation's 1991 Stock Purchase and Option Plan (the "Prior Plan"), but in no
event shall the total exceed 800,000, and subject to adjustment pursuant to
Article 11. In the event that prior to the end of the period during which
Options may be granted under the Plan, any Option or any Nontandem Stock
Appreciation Right under the Plan expires unexercised or is terminated,
surrendered or cancelled (other than in connection with the exercise of a Stock
Appreciation Right) without being exercised in whole or in part for any
reason, then such
<PAGE> 2
shares or units may, at the discretion of the Committee, be made available for
subsequent awards under the Plan, upon such terms as the Committee may
determine.
ARTICLE 3.
ADMINISTRATION
3.1 Committee. The Plan shall be administered by a Compensation
Committee (the "Committee") appointed by the Board and consisting of not less
than two (2) members of the Board who are not also employees of the Corporation
or any of its subsidiaries. Except as permitted by Rule 16b-3(c)(i)(A),(B),(C)
and (D) of the Securities Exchange Act of 1934, as amended (the "1934 Act"), no
member of the Board may serve on the Committee if such member is or has been
granted stock options, stock appreciation rights or any other derivative
security of the Corporation or any of its affiliates pursuant to this Plan or
any other similar plan of the Corporation or its affiliates either while
serving on the Committee or during the one year period prior to being appointed
to the Committee, except nonqualified stock options under the Corporation's
Non-Employee Directors Stock Option Plan.
3.2 Powers of Committee. Subject to the express provisions of the
Plan, the Committee shall have the power and authority (i) to grant Options and
to determine the purchase price of the Common Stock covered by each Option, the
term of each Option, the number of shares of Common Stock to be covered by each
Option and any performance objectives or vesting standards applicable to each
Option; (ii) to designate Options as Incentive Stock Options or Nonstatutory
Stock Options and to determine which Options, if any, shall be accompanied by
Tandem Stock Appreciation Rights; (iii) to grant Tandem Stock Appreciation
Rights and Nontandem Stock Appreciation Rights and to determine the terms and
conditions of such rights; and (iv) to determine the associates to whom, and the
time or times at which, Options and Stock Appreciation Rights shall be granted.
3.3 Delegation. The Committee may delegate to one or more of its
members or to any other person or persons such ministerial duties as it may
deem advisable; provided, however, that the Committee may not delegate any of
its responsibilities hereunder if such delegation will cause the Plan to fail
to comply with the "disinterested administration" rules under Section 16 of the
1934 Act. The Committee may also employ attorneys, consultants, accountants or
other professional advisors and shall be entitled to rely upon the advice,
opinions or valuations of any such advisors.
3.4 Interpretations. The Committee shall have sole discretionary
authority to interpret the terms of the Plan, to adopt and revise rules,
regulations and policies to administer the Plan and to make any other factual
determinations which it believes to be necessary or advisable for the
administration of the Plan. All actions taken and interpretations and
determinations made by the Committee in good faith shall be final and binding
upon the Corporation, all associates who have received awards under the Plan
and all other interested persons.
3.5 Liability; Indemnification. No member of the Committee, nor any
associate to whom ministerial duties have been delegated, shall be personally
liable for any action, interpretation or determination made with respect to the
Plan or awards made thereunder, and each member of the Committee and any such
associate shall be fully indemnified and protected by the Corporation with
2
<PAGE> 3
respect to any liability he or she may incur with respect to any such action,
interpretation or determination, to the extent permitted by applicable law and
to the extent provided in the Corporation's Certificate of Incorporation and
Bylaws, as amended from time to time.
ARTICLE 4.
ELIGIBILITY
Awards shall be limited to executive and key management associates who are
regular, full-time associates of the Corporation and its present and future
subsidiaries and to a limited number of outside consultants and advisors to the
Corporation or its subsidiaries. In determining the associates to whom awards
shall be granted and the number of shares to be covered by each award, the
Committee shall take into account the nature of the services rendered by such
associates, their present and potential contributions to the success of the
Corporation and its subsidiaries and such other factors as the Committee in its
sole discretion shall deem relevant. Unless otherwise specified, references to
associates herein shall mean both employees and non-employee consultants who
have received grants under this Plan. As used in this Plan, the term
"subsidiary" shall mean any corporation which at the time qualifies as a
subsidiary of the Corporation under the definition of "subsidiary corporation"
set forth in Section 424(f) of the Code, or any similar provision hereafter
enacted.
ARTICLE 5.
STOCK OPTIONS
5.1. Grant of Options. Options may be granted under this Plan for the
purchase of shares of Common Stock. Options shall be granted in such form and
upon such terms and conditions, including the satisfaction of corporate or
individual performance objectives and other vesting standards, as the Committee
shall from time to time determine.
5.2 Option Price. The option price of each Option to purchase Common
Stock shall be determined by the Committee at the time of grant, but shall not
be less than 100 percent of the fair market value of the Common Stock subject
to such Option on the date of grant. The option price so determined shall also
be applicable in connection with the exercise of any Tandem Stock Appreciation
Right granted with respect to such Option.
5.3 Term of Options. The term of each Nonstatutory Stock Option
granted under the Plan shall not exceed ten (10) years and one day from the date
of grant, subject to earlier termination as provided in Articles 9 and 10.
Except as otherwise provided in Section 6.1 with respect to ten percent (10%)
stockholders of the Corporation, the term of each Incentive Stock Option shall
not exceed ten (10) years from the date of grant, subject to earlier
termination as provided in Articles 9 and 10.
5.4 Exercise of Options. An Option may be exercised, in whole or in
part, at such time
3
<PAGE> 4
or times as the Committee shall determine. The Committee may, in its
discretion, accelerate the exercisability of any Option at any time. Options
may be exercised by an associate by giving written notice to the Committee
stating the number of shares of Common Stock with respect to which the Option
is being exercised and tendering payment therefor. Payment for the Common Stock
issuable upon exercise of the Option shall be made in full in cash or by check
or, if the Committee, in its sole discretion, permits, in shares of Common
Stock (valued at fair market value on the date of exercise). As soon as
reasonably practicable following such exercise, a certificate representing the
shares of Common Stock purchased, registered in the name of the associate,
shall be delivered to the associate. Notwithstanding the foregoing, an
associate may not exercise an Option prior to the approval of the Plan by the
Corporation's stockholders.
5.5 Cancellation of Stock Appreciation Rights. Upon exercise of all
or a portion of an Option, the related Tandem Stock Appreciation Rights shall
be cancelled with respect to an equal number of shares of Common Stock.
5.6 Restriction on Subsequent Disposition of Stock. No shares of
Common Stock issued upon exercise of an Option or Stock Appreciation Right may
be sold or otherwise disposed of within six (6) months following the date of
grant (assuming it is exercisable within such period of time) by any associate
who is or may be subject to Section 16 of the 1934 Act.
ARTICLE 6.
SPECIAL RULES APPLICABLE TO INCENTIVE STOCK OPTIONS
6.1 Ten Percent Stockholder. Notwithstanding any other provision of
this Plan to the contrary, no associate may receive an Incentive Stock Option
under the Plan if such associate, at the time the award is granted, owns (after
application of the rules contained in Section 424(d) of the Code) stock
possessing more than ten percent (10%) of the total combined voting power of
all classes of stock of the Corporation or its subsidiaries, unless (i) the
option price for such Incentive Stock Option is at least 110 percent of the
fair market value of the Common Stock subject to such Incentive Stock Option
on the date of grant and (ii) such Option is not exercisable after a date
five (5) years from the date such Incentive Stock Option is granted.
6.2 Limitation on Grants. The aggregate fair market value (determined
with respect to each Incentive Stock Option at the time such Incentive Stock
(Option is granted) of the shares of Common Stock with respect to which
Incentive Stock Options are exercisable for the first time by an associate
during any calendar year (under this Plan or any other plan of the Corporation
or a subsidiary) shall not exceed $100,000.
6.3 Limitation on Time of Grants. No grant of an Incentive Stock
Option shall be made under this Plan more than ten (10) years after the earlier
of the date of adoption of the Plan by the Board or the date the Plan is
approved by the Corporation's stockholders.
6.4 Employee Status. No grant of an Incentive Stock Option shall be
made under this Plan unless the associate is an employee of the Corporation or
one of its subsidiaries at the date of grant.
4
<PAGE> 5
ARTICLE 7.
STOCK APPRECIATION RIGHTS
7.1 Tandem Stock Appreciation Rights Generally. Tandem Stock
Appreciation Rights are attached to individual Option grants and may permit the
associate, depending upon the terms of grant, to either: (a) exercise such
Option with respect to a specified portion of the exercisable shares of Common
Stock and with respect to the remaining portion of the exercisable shares
receive a cash payment equal to the gain in fair market value of such shares
from the date of grant to the date of exercise, or (b) elect to receive a
combination of shares of Common Stock and a cash payment at the time of
exercise with the sum of the then fair market value of such shares and the cash
payment for any given grant being equal to the gain in fair market value of the
shares from the date of grant to the date of exercise.
7.2 Non-tandem Stock Appreciation Rights Generally. A Nontandem
Stock Appreciation Right relates to shares of Common Stock' of the Corporation
and generally will have the same terms and conditions as described in Section
7.1, but is independent of and unrelated to the grant of Options. The grantee
of a Nontandem Stock Appreciation Right may be entitled, depending upon the
terms of grant, to receive a payment in cash or in shares of Common Stock or in
a combination of cash and shares equal in value to the gain in the fair market
value of the Common Stock from the date of grant of such Nontandem Stock
Appreciation Right to the date of exercise with respect to the shares
represented by such Nontandem Stock Appreciation Right. However, the Committee,
in its sole discretion, may set a maximum limit on the amount of gain that may
be realized upon exercise of any such Nontandem Stock Appreciation Right, and
may specify such other terms and conditions regarding the exercise of such
Nontandem Stock Appreciation Right or the benefits to be derived therefrom.
7.3 Grants of Stock Appreciation Rights. Tandem Stock Appreciation
Rights may be awarded by the Committee in connection with any Option granted
under the Plan, either at the time the Option is granted or thereafter at any
time prior to the exercise, termination or expiration of the Option. Nontandem
Stock Appreciation Rights may also be granted by the Committee at any time. At
the time of grant of a Nontandem Stock Appreciation Right, the Committee shall
specify the number of shares of Common Stock covered by such right and the base
price of the shares of Common Stock to be used in connection with the
calculation described in Section 7.6 below. The base price of a Nontandem Stock
Appreciation Right shall be not less than 100 percent of the fair market value
of a share of Common Stock on the date of grant. Stock Appreciation Rights
shall be subject to such terms and conditions not inconsistent with the other
provisions of this Plan as the Committee shall determine.
7.4 Limitations on Exercise. A Tandem Stock Appreciation Right
shall be exercisable only to the extent that the related Option is exercisable
and shall be exercisable only for such period as the Committee may determine
(which period may expire prior to the expiration date of the related Option).
Upon the exercise of all or a portion of Tandem Stock Appreciation Rights, the
related Option shall be cancelled with respect to an equal number of shares of
Common Stock. Shares of Common Stock subject to Options, of portions thereof,
surrendered upon exercise of a Tandem Stock Appreciation Right, shall not be
available for subsequent awards under the Plan. A Nontandem
5
<PAGE> 6
Stock Appreciation Right shall be exercisable during such period as the
Committee shall determine.
7.5 Surrender or Exchange of Tandem Stock Appreciation Rights. A
Tandem Stock Appreciation Right shall entitle the associate to surrender to
the Corporation unexercised the related Option, or any portion thereof, and to
receive from the Corporation in exchange therefor that number of shares of
Common Stock having an aggregate fair market value equal to (A) the excess of
(i) the fair market value of one (1) share of Common Stock as of the date the
Tandem Stock Appreciation Right is exercised over (ii) the option price per
share specified in such Option, multiplied by (B) the number of shares of
Common Stock subject to the Option, or portion thereof, which is surrendered.
Cash shall be delivered in lieu of any fractional shares.
7.6 Exercise of Nontandem Stock Appreciation Rights. The exercise
of a Nontandem Stock Appreciation Right shall entitle the associate to receive
from the Corporation that number of shares of Common Stock having an aggregate
fair market value equal to (A) the excess of (i) the fair market value of one
(1) share of Common Stock as of the date on which the Nontandem Stock
Appreciation Right is exercised over (ii) the base price of the shares covered
by the Nontandem Stock Appreciation right, multiplied by (B) the number of
shares of Common Stock covered by the Nontandem Stock Appreciation Right, or
the portion thereof being exercised. Cash shall be delivered in lieu of any
fractional shares.
7.7 Settlement of Stock Appreciation Rights. As soon as is
reasonably practicable after the exercise of a Stock Appreciation Right, the
Corporation shall (i) issue, in the name of the associate, stock certificates
representing the total number of full shares of Common Stock to which the
associate is entitled pursuant to Section 7.5 or 7.6 hereof and cash in an
amount equal to the fair market value, as of the date of exercise, of any
resulting fractional shares, and (ii) if the Committee causes the Corporation
to elect to settle all or part of its obligations arising out of the exercise
of the Stock Appreciation Right in cash pursuant to Section 7.8, deliver to the
associate an amount in cash equal to the fair market value, as of the date of
exercise, of the shares of Common Stock it would otherwise be obligated to
deliver.
7.8 Cash Settlement. The Committee, in its discretion, may cause
the Corporation to settle all or any part of its obligation arising out of the
exercise of a Stock Appreciation Right by the payment of cash in lieu of all or
part of the shares of Common Stock it would otherwise be obligated to deliver
under the terms of grant in an amount equal to the fair market value of such
shares on the date of exercise.
ARTICLE 8.
NONTRANSFERABILITY OF OPTIONS AND STOCK APPRECIATION RIGHTS
No Option or Stock Appreciation Right may be transferred, assigned, pledged or
hypothecated (whether by operation of law or otherwise), except as provided by
will or the applicable laws of descent and distribution, and no Option or Stock
Appreciation Right shall be subject to execution, attachment or similar
process. Any attempted assignment, transfer, pledge, hypothecation or other
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disposition of an Option or a Stock Appreciation Right not specifically
permitted herein shall be null and void and without effect. An Option or Stock
Appreciation Right may be exercised only by an associate or his or her guardian
or legal representative during his or her lifetime, or following his or her
death pursuant to Article 10.
ARTICLE 9.
TERMINATION OF EMPLOYMENT
9.1 Exercise after Termination of Employment. In the event that the
employment of an associate to whom an Option or Stock Appreciation Right has
been granted under the Plan shall be terminated (for reasons other than death
or total disability), such Option or Stock Appreciation Right may be exercised
(to the extent that the associate was entitled to do so at the termination of
his employment) at any time within three (3) months after such termination of
employment.
9.2 Total Disability. In the event that an associate to whom an
Option or Stock Appreciation Right has been granted under the Plan shall become
totally disabled, such Option or Stock Appreciation Right may be exercised at
any time during the first nine (9) months after the associate first receives
benefits under the Corporation's Long-Term Disability Plan (the "Disability
Plan"). For purposes hereof, "total disability" shall have the definition set
forth in the Disability Plan, which definition is hereby incorporated by
reference.
9.3 Disability of or Cessation of Service by a Consultant. A
consultant shall be entitled to exercise Options or Stock Appreciation Rights
only during such time as he or she remains as an active consultant to the
Corporation or a subsidiary thereof and for a period of three (3) months
thereafter; provided, however, that a consultant shall be entitled to exercise
awards for a period of nine (9) months following the total disability of such
consultant.
ARTICLE 10.
DEATH OF ASSOCIATE
If an associate to whom an Option or Stock Appreciation Right has been
granted under the Plan shall die while employed by, or while in the active
service of, the Corporation or one of its subsidiaries or within three (3)
months after the termination of such employment or cessation of service, such
Option or Stock Appreciation Right may be exercised to the extent that the
associate was entitled to do so at the time of his or her death, by the
associate's estate or by the person who acquires the right to exercise such
Option or Stock Appreciation Right upon his or her death by bequest or
inheritance. Such exercise may occur at any time within one (1) year after the
date of the associate's death, but in no case later than the date on which the
Option or Stock Appreciation Right terminates.
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ARTICLE 11.
ADJUSTMENT UPON CHANGES IN CAPITALIZATION
Notwithstanding any other provision of the Plan, the Committee may at
any time make or provide for such adjustments to the Plan, to the number and
class of shares available thereunder or to any outstanding Options or Stock
Appreciation Rights as it shall deem appropriate to prevent dilution or
enlargement of rights, including adjustments in the event of changes in the
number of shares of outstanding Common Stock by reason of stock dividends,
split-ups, recapitalizations, mergers, consolidations, combinations or exchange
of shares, separations, reorganizations, liquidations and the like.
ARTICLE 12.
AMENDMENT AND TERMINATION
The Board may suspend, terminate, modify or amend the Plan, provided
that any amendment that would (i) materially increase the aggregate number of
shares which may be issued under the Plan; (ii) materially increase the
benefits accruing to associates under the Plan; or (iii) materially modify the
requirements as to eligibility for participation in the Plan, shall be subject
to the approval of the Corporation's stockholders, except that any such
increase or modification that may result from adjustments authorized by Article
11 does not require such approval. If the Plan is terminated, the terms of the
Plan shall, notwithstanding such termination, continue to apply to awards
granted prior to such termination. No suspension, termination, modification or
amendment of the Plan may, without the consent of the associate to whom an
award shall theretofore have been granted, adversely affect the rights of such
associate under such award, nor otherwise cause Rule 16b-3 under the 1934 Act,
or the equivalent thereof from time to time in effect, to become inapplicable.
ARTICLE 13.
WRITTEN AGREEMENT
Each award of Options or Stock Appreciation Rights shall be evidenced
by a written agreement, executed by the associate and the Corporation,
containing such restrictions, terms and conditions, if any, as the Committee
may require. In the event of any conflict between a written agreement and the
Plan, the terms of the Plan shall govern.
ARTICLE 14.
MISCELLANEOUS PROVISIONS
14.1 Fair Market Value. "Fair market value" of a share of Common
Stock for purposes of this Plan shall be the simple average of the high and low
prices at which the Common Stock traded
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on the date of grant, exercise or other transaction as quoted on the NASDAQ-NMS
or other principal exchange on which the Common Shares are listed on that date,
and if there were no sales on such date, the most recent prior date on which
there were sales.
14.2 Tax Withholding. The Corporation shall have the right to require
associates or their beneficiaries or legal representatives to remit to the
Corporation an amount sufficient to satisfy Federal, state and local
withholding tax requirements, or to deduct from all payments under this Plan
amounts sufficient to satisfy all withholding tax requirements. Whenever
payments under the Plan are to be made to an associate in cash, such payments
shall be net of any amounts sufficient to satisfy all Federal, state and local
withholding tax requirements. The Committee may, in its discretion, permit an
associate to satisfy his or her tax withholding obligation either by (i)
surrendering shares of Common Stock owned by the associate or (ii) having the
Corporation withhold from shares of Common Stock otherwise deliverable to the
associate. Shares surrendered or withheld shall be valued at their fair market
value as of the date on which income is required to be recognized for income
tax purposes. In the case of an award of Incentive Stock Options, the foregoing
right shall be deemed to be provided to the associate at the time of such award.
14.3 Compliance with Section 16(b). In the case of associates who are
or may be subject to Section 16 of the 1934 Act, it is the intent of the
Corporation that the Plan and any award granted hereunder satisfy and be
interpreted in a manner that satisfies the applicable requirements of Rule
16b-3, so that such persons will be entitled to the benefits of Rule 16b-3 or
other exemptive rules under Section 16 of the 1934 Act and will not be
subjected to liability thereunder. If any provision of the Plan or any award
would otherwise conflict with the intent expressed herein, that provision, to
the extent possible, shall be interpreted and deemed amended so as to avoid
such conflict. To the extent of any remaining irreconcilable conflict with such
intent, such provision shall be deemed void as applicable to associates who are
or may be subject to Section 16 of the 1934 Act.
14.4 Compliance with Securities Act of 1933. Each Option or Stock
Appreciation Right granted under the Plan shall be subject to the further
condition that if, at any time, in the opinion of counsel for the Corporation,
the registration, listing or qualification of the shares covered by such Option
or Stock Appreciation Right under the Securities Act of 1933, as amended (the
"1933 Act"), upon any securities exchange or under any state law, or the
consent or approval of any governmental regulatory body or the updating,
amendment or revision of any registration statement, listing application, or
similar document, is required as a condition of, or in connection with, the
purchase of shares under such Option or the exercise of rights under such Stock
Appreciation Right, no such Option or Stock Appreciation Right may be exercised
unless and until such registration, listing, qualification, consent, approval,
updating, amendment or revision shall have been effected or obtained free of
any conditions not acceptable to the Committee; provided, however, that subject
to Sections 9 and 10 hereof, if the right to exercise any Option or Stock
Appreciation Right is suspended for any of the foregoing reasons, the
termination date for exercising such Option or Stock Appreciation Right is
extended for the length of time of the suspension or thirty (30) days after the
date on which the associate holding such Option or Stock Appreciation Right is
notified that such suspension of the right to exercise such Option or Stock
Appreciation Right has ended. The Board or the Committee may, as a condition to
the exercise by an associate of an Option, require that the associate agree in
writing that he or she will not dispose of the shares of Common Stock to be
acquired upon such exercise in a transaction which, in the opinion of counsel
for the Corporation, would violate the 1933
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<PAGE> 10
Act and the rules and regulations promulgated thereunder. The Board or the
Committee shall have the authority to require additional agreements or impose
additional conditions which it reasonably believes are necessary to assure
compliance with Federal and state securities and other laws.
14.5 Successors. The obligations of the Corporation under the Plan
shall be binding upon any successor corporation or organization resulting from
the merger, consolidation or other reorganization of the Corporation, or upon
any successor corporation or organization succeeding to substantially all of
the assets and business of the Corporation. In the event of any of the
foregoing, the Committee may, at its discretion, prior to the consummation of
the transaction, cancel, offer to purchase, exchange, adjust or modify any
outstanding awards, at such time and in such manner as the Committee deems
appropriate and in accordance with applicable law.
14.6 General Creditor Status. Associates shall have no right, title
or interest whatsoever in or to any investments which the Corporation may make
to aid it in meeting its obligations under the Plan. Nothing contained in the
Plan, and no action taken pursuant to its provisions, shall create or be
construed to create a trust of any kind, or a fiduciary relationship between
the Corporation and any associate or beneficiary or legal representatives of
such associate. To the extent that any person acquires a right to receive
payments from the Corporation under the Plan, such right shall be no greater
than the right of an unsecured general creditor of the Corporation. All
payments to be made hereunder shall be paid from the general funds of the
Corporation and no special or separate fund shall be established and no
segregation of assets shall be made to assure payment of such amounts except as
expressly set forth in the Plan.
14.7 Rights as a Stockholder. No associate shall have any right as
a stockholder with respect to any shares subject to an Option or Stock
Appreciation Right until the date of the issuance of a stock certificate to him
or her for such shares of Common Stock. No adjustment shall be made for
dividends (whether ordinary or extraordinary, or whether in cash, securities or
other property) or distributions of other rights for which the record date is
prior to the date such stock certificates are issued, except as otherwise
provided herein.
14.8 No Right to Employment. Nothing in the Plan or in any written
agreement entered into pursuant to Article 13, nor the grant of any award,
shall confer upon any associate any right to continue in the employ of the
Corporation or a subsidiary or to be entitled to any remuneration or benefits
not set forth in the Plan or such written agreement or interfere with or limit
the right of the Corporation or a subsidiary to modify the terms of or
terminate such associate's employment at any time.
14.9 Other Plans. Effective upon the adoption of the Plan by the
Corporation's stockholders, no further awards shall be made under the Prior
Plan. Thereafter, all awards made under the Prior Plan prior to adoption of
this Plan by the stockholders shall continue in accordance with the terms of
the Prior Plan.
14.10 Application of Funds. The proceeds received by the Corporation
from the sale of Common Stock pursuant to Options granted under the Plan shall
be used for general corporate purposes.
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14.11 Notices. Notices required or permitted to be made under the
Plan shall be sufficiently made if sent by registered or certified mail, return
receipt requested, addressed (a) to the associate at the associate's address as
set forth in the books and records of the Corporation or its subsidiaries, or
(b) to the Corporation or the Committee at the principal office of the
Corporation.
14.12 Severability. In the event that any provision of the Plan
shall be held illegal or invalid for any reason, such illegality or invalidity
shall not affect the remaining parts of the Plan, and the Plan shall be
construed and enforced as if the illegal or invalid provision had not been
included.v
14.13 Governing Law. To the extent not preempted by Federal law, the
Plan, and all agreements hereunder, shall be construed in accordance with and
governed by the laws of the State of Delaware.
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EXHIBIT 4.2
MASLAND HOLDINGS, INC.
1991 STOCK PURCHASE AND OPTION PLAN
1. PURPOSE OF PLAN. This 1991 Stock Purchase and Option Plan (the
"Plan") of Masland Holdings, Inc. (the "Company") is designed to provide
incentives to such present and future employees, directors, consultants or
advisers of the Company or its subsidiaries ("Participants"), as may be
selected in the sole discretion of the Company's board of directors, through
the grant of Options by the Company to Participants or through the sale of
Common Stock to Participants.
2. DEFINITIONS. Certain terms used in this Plan have the meanings
set forth below:
"Board" means the Company's board of directors.
"Code" means the Internal Revenue Code of 1986, as it may be amended
from time to time.
"Class P Common" means the company's Class P Common Stock, par value
$.01 per share.
"Common" means the Company's Common Stock, par value $.01 per share.
"Common Stock" means the Class P Common and the Common.
"Fair market value" of a share of Common Stock means (a) the mean
between the highest and lowest reported sale prices of a share of Common Stock
on the New York Stock Exchange -- Composite Transactions Table (or, if not so
reported, on any domestic stock exchanges on which the Common Stock is then
listed); or (b) if the Common Stock is not listed on any domestic stock
exchange, the mean between the closing high bid and low asked prices of a share
of Common Stock as reported by the National Association of Securities Dealers
Automated Quotation System (or, if not so reported, by the system then regarded
as the most reliable source of such quotations); or (c) if the Common Stock is
listed on a domestic stock exchange or quoted in the domestic over-the-counter
market, but there are not reported sales or quotations, as the case may be, on
the given date, the value determined pursuant to (a) or (b) above using the
reported sale prices or quotations on the last previous date on which so
reported; or (d) if none of the foregoing clauses apply, the fair value of a
share of Common Stock as determined in good faith by the Board.
<PAGE> 2
"Option" means any option enabling the holder thereof to purchase any
class of Common Stock from the Company granted by the Board pursuant to the
provisions of this Plan. Options to be granted under this Plan may be incentive
stock options within the meaning of Section 422 of the Code ("Incentive Stock
Options") or in such other form, consistent with this Plan, as the Board may
determine.
"Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if, at the time the
option is granted, each of the corporations other than the last corporation in
the chain owns stock possessing 50 percent or more of the total combined voting
power of all classes of stock in one of the other corporations in such chain.
3. GRANT OF OPTIONS. The Board shall have the right and power to
grant to any Participant Options at any time prior to the termination of this
Plan in such quantity, at such price, on such terms and subject to such
conditions that are consistent with this Plan and established by the Board.
Options granted under this Plan shall be subject to such terms and conditions
and evidenced by agreements as shall be determined from time to time by the
Board.
4. SALE OF COMMON STOCK. The Board shall have the power and
authority to sell to any Participant any class or classes of Common Stock at
any time prior to the termination of this Plan in such quantity, at such price,
on such terms and subject to such conditions that are consistent with this Plan
and established by the Board. Common Stock sold under this Plan shall be
subject to such terms and evidenced by agreements as shall be determined from
time to time by the Board.
5. ADMINISTRATION OF THE PLAN. The Board shall have the power and
authority to prescribe, amend and rescind rules and procedures governing the
administration of this Plan, including, but not limited to the full power and
authority (i) to interpret the terms of this Plan, the terms of any Options
granted under this Plan, and the rules and procedures established by the Board
governing any such Options and (ii) to determine the rights of any person under
this Plan, or the meaning of requirements imposed by the terms of this Plan or
any rule or procedure established by the Board. Each action of the Board which
shall be binding on all persons.
6. LIMITATION ON THE AGGREGATE NUMBER OF SHARES. The number of
shares of Common Stock with respect to which Options may be granted under this
Plan (and which may be issued upon the exercise or payment thereof) shall not
exceed, in the aggregate, 100,000 shares of Class P Common and 1,500,000 shares
of Common (as
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such numbers are equitably adjusted pursuant to paragraph 10 hereof). If any
Options expire unexercised or unpaid or are canceled, terminated or forfeited
in any manner without the issuance of Common Stock or payment thereunder, the
shares with respect to which such Options were granted shall again be available
under this Plan. Similarly, if any shares of Common Stock issued hereunder upon
exercise of Options are repurchased hereunder, such shares shall again be
available under this Plan for reissuance as Options. Shares of Common Stock to
be issued upon exercise of the Options or shares of Common Stock to be sold
directly hereunder may be either authorized and unissued shares, treasury
shares, or a combination thereof, as the Board shall determine.
7. INCENTIVE STOCK OPTIONS. All Incentive Stock Options (i) shall
have an exercise price per share of Common Stock of not less than 100% of the
fair market value of such share on the date of grant, (ii) shall not be
exercisable more than ten years after the date of grant, (iii) shall not be
transferable other than by will or under the laws of descent and distribution
and, during the lifetime of the Participant to whom such Incentive Stock
Options were granted, may be exercised only by such Participant (or his
guardian or legal representative), and (iv) shall be exercisable only during
the Participant's employment by the Company or a Subsidiary, provided, however,
that the Board may, in its discretion, provide at the time that an Incentive
Stock Option is granted that such Incentive Stock Option may be exercised for a
period ending upon either (x) the termination of this Plan in the event of the
Participant's death while an employee of the Company or a Subsidiary, or (y)
the date which is three months after termination of the Participant's
employment for any other reason. The Board's discretion to extend the period
during which an Incentive Stock Option is exercisable shall only apply to the
extent that (i) the Participant was entitled to exercise such option on the
date of termination, and (ii) such option would not have expired had the
Participant continued to be employed by the Company or a Subsidiary.
8. LISTING, REGISTRATION AND COMPLIANCE WITH LAWS AND
REGULATIONS. Each Option shall be subject to the requirement that if at any
time the Board shall determine, in its discretion, that the listing,
registration or qualification of the shares subject to the Option upon any
securities exchange or under any state or federal securities or other law or
regulation, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition to or in connection with the granting of
such Option or the issue or purchase of shares thereunder, no such Option may
be exercised or paid in Common Stock in whole or in part unless such listing,
registration, qualification, consent or approval (a "Required Listing") shall
have been effected or obtained, and the holder of the Option will supply the
Company with
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such certificates, representations and information as the Company shall request
which are reasonably necessary or desirable in order for the Company to obtain
such Required Listing, and shall otherwise cooperate with the Company in
obtaining such Required Listing. In the case of officers and other persons
subject to Section 16(b) of the Securities Exchange Act of 1934, as amended,
the Board may at any time impose any limitations upon the exercise of an Option
which, in the Board's discretion, are necessary or desirable in order to comply
with Section 16(b) and the rules and regulations thereunder. If the Company, as
part of an offering of securities or otherwise, finds it desirable because of
federal or state regulatory requirements to reduce the period during which any
Options may be exercised, the Board may, in its discretion and without the
consent of the holders of any such Options, so reduce such period on not less
than 15 days' written notice to the holders thereof.
9. CASH PAYMENTS UPON EXERCISE. Options which are not Incentive
Stock Options may, in the Board's discretion, provide that the holder thereof,
as soon as practicable after the exercise of the Options will receive, in lieu
of any issuance of Common Stock, a cash payment in such amount as the Board may
determine, but not more than the excess of the fair market value of a share of
Common Stock (on the date the holder recognizes taxable income) over the
Option's exercise price multiplied by the number of shares as to which the
Option is exercised.
10. ADJUSTMENT FOR CHANGE IN COMMON STOCK. In the event of a
reorganization, recapitalization, stock split, stock dividend, combination of
shares, merger, consolidation or other change in the Common Stock, the Board
shall make appropriate changes in the number and type of shares authorized by
this Plan, the number and type of shares covered by outstanding Options and the
prices specified therein.
11. TAXES. The Company shall be entitled, if necessary or
desirable, to withhold (or secure payment from the Plan participant in lieu of
withholding) the amount of any withholding or other tax due from the Company
with respect to any amount payable and/or shares issuable under this Plan, and
the Company may defer such payment or issuance unless indemnified to
its satisfaction.
12. TERMINATION AND AMENDMENT. The Board at any time may suspend
or terminate this Plan and make such additions or amendments as it deems
advisable under this Plan, except that they may not, without further approval
by the Company's stockholders, (a) increase the maximum number of shares as to
which Options may be granted under this Plan, except pursuant to paragraph 10
above or (b) extend the term of this Plan; provided that, subject to
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paragraph 8 hereof, the Board may not change any of the terms of a written
agreement with respect to an Option between the Company and the holder of such
Option without the approval of the holder of such Option. No Options shall be
granted or shares of Common Stock issued hereunder after August 2, 2001.
* * * * *
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EXHIBIT 4.3
FORM OF
OPTION ASSUMPTION AGREEMENT
THIS OPTION ASSUMPTION AGREEMENT (this "Agreement") is made as
of ____________, 1996 by and between Lear Corporation ("Lear") and the optionee
(the "Optionee") whose name is set forth on the signature page hereto.
WHEREAS, Lear, Masland Corporation ("Masland") and PA
Acquisition ("PA") have entered into an Agreement and Plan of Merger (the
"Merger Agreement") dated May 23, 1996 whereby, among other things, Lear and PA
have offered to purchase all of the outstanding shares of Masland's Common
Stock, par value $.01 per share (the "Masland Shares") at a price of $26.00 per
share (as such price may be increased pursuant to the Merger Agreement (the
"Offer Price")); and
WHEREAS, in connection with the transactions contemplated
under the Merger Agreement, Lear has agreed to assume Masland's obligations
under the Masland Holdings, Inc. 1991 Stock Purchase and Option Plan (the "1991
Plan") and the Masland Corporation 1993 Stock Option Incentive Plan (the "1993
Plan") (collectively, the "Stock Option Plans") upon consummation of the merger
of PA into Masland in accordance with the terms of the Merger Agreement (the
"Merger"); and
WHEREAS, in connection with Lear's assumption of Masland's
obligations under the 1991 Plan, Lear has agreed, if the Optionee so desires
with respect to his options under that plan, to assume upon consummation of the
Merger, Masland's obligations under each stock option agreement entered into
between Masland and the Optionee under the 1991 Plan, it being understood that
each grant by Masland to the Optionee of the right to purchase Masland Shares
has been evidenced by a stock option agreement between Masland and the Optionee
(an "1991 Option Agreement"); and
WHEREAS, the Optionee desires to convert the right to
purchase the number of Masland Shares set forth on the signature page hereto
under the caption "Number of Shares Converted" into the right to purchase
shares of Lear's Common Stock, $.01 par value per share ("Lear Shares") as set
forth in this Agreement; and
WHEREAS, in connection with Lear's assumption of Masland's
obligations under the 1993 Plan, Lear has agreed to assume, upon consummation
of the Merger, Masland's obligations under each stock option agreement entered
into between Masland and the Optionee under the 1993 Plan, it being understood
that each grant by Masland to the Optionee of the right to purchase Masland
Shares has been evidenced by a stock option agreement between Masland and the
Optionee (a "1993 Option Agreement").
<PAGE> 2
NOW, THEREFORE, the parties agree as follows:
1. Consummation of Merger. The obligations of Lear
under this Agreement are conditioned upon the consummation of the Merger. Upon
the consummation of the Merger, this Agreement shall entitle the Optionee to
purchase Lear Shares, subject to the terms and conditions of this Agreement,
the Stock Option Plans, the 1991 Option Agreements and the 1993 Option
Agreements. In the event that the Merger is not consummated, neither Lear nor
the Optionee shall have any rights, obligations or remedies under this
Agreement.
2. Conversion. Upon consummation of the Merger, each
right of the Optionee to purchase that number of Masland Option Shares set
forth on the signature page hereto under the caption "Number of Shares
Converted" ("Converted Shares") and identified to an assumed Option Agreement
by grant date shall respectively be converted into the right to purchase (a
"Lear Option") that number of Lear Shares determined in accordance with Section
4 below at a price per Lear Share determined in accordance with Section 3
below. Upon the effectiveness of this Agreement, the Optionee shall have no
right to receive those Converted Shares set forth on the signature page hereto
under any Option Agreement, and shall, with respect to those Converted Shares
set forth on the signature page hereto, have the right to receive only those
number of Lear Shares determined in accordance with Section 4 below at a price
per Lear Share determined in accordance with Section 3 below.
3. Exercise Price of Lear Shares Under the Lear Options.
As determined separately with respect to each Lear Option, the exercise price of
Lear Shares shall be the product of (i) the average closing price of Lear Shares
as reported on the New York Stock Exchange for the period of the 20 consecutive
business days ending on June 26, 1996 (the "Lear Market Price") multiplied by
(ii) the quotient of (a) the qreater of (x) the exercise price of the Masland
Option Shares and (y) $8.00 divided by (b) the Offer Price.
Notwithstanding the foregoing, the exercise price per Lear
Share determined in accordance with this Section 3 shall be rounded to the
nearest whole cent.
4. Number of Lear Shares Issuable Under the Lear Option.
As determined separately with respect to each Lear Option, the number of Lear
Shares an Optionee shall have the right to receive shall equal the quotient of
(i) the product of (a) the number of Masland Option Shares multiplied by (b)
the exercise price of the Masland Option Shares, divided by (ii) the difference
of (x) the Lear Market Price minus (y) the Exercise Price determined in Section
3.
Notwithstanding the foregoing, the number of Lear Shares to be
received by the Optionee in accordance with this Section 4 shall be rounded to
the nearest whole Lear Share.
5. Vesting and Exercise. Each Lear Option received by
the Optionee pursuant to this Agreement shall vest and become exercisable in
accordance with the terms of the respective assumed Option Agreement.
Notwithstanding the foregoing, in the case of an Optionee whose employment is
terminated without cause within one year of the consummation of the Merger, the
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<PAGE> 3
Lear Options shall remain exercisable for the two year period following the
Optionee's termination of employment.
6. Ratification. This Agreement is limited as specified
herein. Except as expressly set forth in this Agreement, the Stock Option
Plans, each 1991 Option Agreement and each 1993 Option Agreement is hereby
ratified and confirmed in all respects.
7. General Provisions.
(a) Severability. Whenever possible, each provision of
this Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or enforceability will
not affect any other provision or any other jurisdiction, but this Agreement
will be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
(b) Complete Agreement. This Agreement, those documents
expressly referred to herein and other documents of even date herewith embody
the complete agreement and understanding among the parties and supersede and
preempt any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof
in any way.
(c) Counterparts. This Agreement may be executed in
separate counterparts, each of which is deemed to be an original and all of
which taken together constitute one and the same agreement.
(d) Successors and Assigns. Except as otherwise provided
herein, this Agreement shall bind and inure to the benefit of and be
enforceable by the Optionee, Lear and their respective successors and assigns;
provided that the rights and obligations of the Optionee under this Agreement
shall not be assignable without the prior written consent of Lear.
(e) Choice of Law. The corporate law of Delaware will
govern all questions concerning the relative rights of Masland and the
Optionee. All other questions concerning the construction, validity and
interpretation of this Agreement will be governed by and construed in
accordance with the internal laws of Michigan, without giving effect to any
choice of law or conflict of law provision or rule (whether of Michigan or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than Michigan.
(f) Remedies. Each of the parties to this Agreement will
be entitled to enforce its rights under this Agreement specifically, to recover
damages and costs (including attorneys' fees) caused by any breach of any
provision of this Agreement and to exercise all other rights existing in its
favor. The parties hereto agree and acknowledge that money damages may not be
an adequate remedy for any breach of the provisions of this Agreement and that
any party may in its sole
3
<PAGE> 4
discretion apply to any court of law or equity of competent jurisdiction
(without posting any bond or other security) for specific performance and/or
other injunctive relief in order to enforce or prevent any violations of the
provisions of this Agreement.
(g) Amendment and Waiver. The provisions of this
Agreement may be amended and/or waived only with the written consent of Lear.
(h) Headings. Section and subsection headings are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purposes or be given substantive effect.
[signature page follows]
4
<PAGE> 5
IN WITNESS WHEREOF, the parties hereto have executed this
Option Assumption Agreement on the date first written above.
LEAR CORPORATION
By: _______________________________
Its: _______________________________
OPTIONEE:
_____________________________________
[Optionee]
The number of Masland Option Shares granted to the Optionee
pursuant to 1991 Option Agreements and/or 1993 Option Agreements to be
converted:
<TABLE>
<CAPTION>
1991 Plan
---------
Number of Shares Number of Shares
Grant Date Exercise Price Granted Converted
---------- -------------- --------------------- --------------------
<S> <C> <C> <C>
_________ ____________ [__________] __________
_________ ____________ [__________] __________
_________ ____________ [__________] __________
_________ ____________ [__________] __________
_________ ____________ [__________] __________
_________ ____________ [__________] __________
</TABLE>
<TABLE>
<CAPTION>
1993 Plan
---------
Number of Shares Number of Shares
Grant Date Exercise Price Granted Converted
---------- -------------- --------------------- --------------------
<S> <C> <C> <C>
_________ ____________ [__________] __________
_________ ____________ [__________] __________
_________ ____________ [__________] __________
_________ ____________ [__________] __________
_________ ____________ [__________] __________
_________ ____________ [__________] __________
</TABLE>
5
<PAGE> 1
EXHIBIT 4.4
FORM OF
OPTION CANCELLATION AGREEMENT
THIS OPTION CANCELLATION AGREEMENT (this "Agreement") is made
as of ___________, 1996 by and between Masland Corporation ("Masland") and the
optionee (the "Optionee") whose name is set forth on the signature page hereto.
WHEREAS, pursuant to the Agreement and Plan of Merger (the
"Merger Agreement") dated May 23, 1996 by and among Masland, Lear Corporation
("Lear"), and PA Acquisition Corp.("PA"), Lear and PA have agreed to purchase
all of the shares of Masland's Common Stock, par value $.01 per share (the
"Shares") at a price of $26.00 per share in cash (as such price may be
increased pursuant to the Merger Agreement (the "Offer Price")); and
WHEREAS, in connection with the transactions contemplated
under the Merger Agreement, the Optionee desires to cancel the Optionee's
rights under options ("Options") granted pursuant to the Masland Holdings, Inc.
1991 Stock Purchase and Option Plan (the "1991 Plan") to purchase the number of
Shares set forth on the signature page hereto under the caption "Number of
Option Shares to be Cancelled" (the "Cancelled Option Shares"); and
WHEREAS, in connection with such cancellations, Masland shall
pay to the Optionee an amount equal to the number of Cancelled Option Shares
under each Option multiplied by the excess of (a) the Offer Price over (b) the
exercise price under the Option (the "Cancellation Payment").
NOW, THEREFORE, the parties agree as follows:
1. Cancellation. The Optionee hereby agrees to cancel
and surrender all of the Optionee's rights under each Option solely to the
extent of the Cancelled Option Shares effective on the date of the consummation
of the Merger, and Masland hereby agrees to pay to the Optionee on the date of
the consummation of the Merger, or as soon as practicable thereafter, the
Cancellation Payment. Notwithstanding the foregoing, Masland shall be entitled
to withhold from the Optionee's Cancellation Payment the amount of any
withholding or other tax due in connection with such cancellation. In the
event that the Merger is not consummated, neither Masland nor the Optionee
shall have any rights, obligations or remedies under this Agreement.
2. Optionee's Representation and Warranties. As a
material inducement to Masland to enter into this Agreement and make the
Cancellation Payment, the Optionee hereby represents and warrants to the
Company that: (a) other than pursuant to Options and options granted
under the Masland Corporation 1993 Stock Option Incentive Plan, the
<PAGE> 2
Optionee has no right, title or interest in any stock or securities convertible
or exchangeable for any shares of Masland's capital stock and the Optionee does
not have any right, title or interest in any rights or options to subscribe for
or to purchase Masland's capital stock or any stock or securities convertible
into or exchangeable for Masland's capital stock; (b) to the best of the
knowledge of the Optionee, all of the Options are duly authorized and validly
issued; and (c) the Optionee has good, marketable and unencumbered title to the
Options, free and clear of all pledges, security interests, liens, claims,
encumbrances, agreements, rights of first refusal, and options of any kind
whatsoever.
(b) Authorization; No Breach. This Agreement has been
duly executed and delivered by the Optionee. This Agreement constitutes a
valid and binding obligation of the Optionee, enforceable in accordance with
its terms. The execution and delivery by the Optionee of this Agreement and
compliance with the terms hereof by the Optionee, do not and shall not (i)
conflict with or result in a breach of the terms, conditions or provisions of,
(ii) constitute a default under, (iii) result in a violation of, or (iv)
require any authorization, consent, approval, exemption or other action by or
notice to any court or administrative or governmental body pursuant to, any
law, statute, rule or regulation to which the Optionee is subject, or any
agreement, instrument, order, judgment or decree to which the Optionee is a
party or by which it is bound.
3. Indemnification. The Optionee shall indemnify,
defend and hold harmless from and against any and all claims, losses,
liabilities, costs, expenses, obligations and damages incurred or paid by
Masland that would not have been sustained, incurred or paid if all of the
representations and warranties set forth in Section 2 hereof had been true and
correct.
4. Release. Each of Masland and the Optionee does
hereby forever release, discharge and acquit the other party from all claims,
demands, obligations and liabilities, whensoever arising out of, connected with
or relating to the Cancelled Option Shares and the cancellation thereof (except
pursuant to Section 3 hereof).
5. General Provisions.
(a) Severability. Whenever possible, each provision of
this Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability will
not affect any other provision or any other jurisdiction, but this Agreement
will be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
(b) Complete Agreement. This Agreement, those documents
expressly referred to herein and other documents of even date herewith embody
the complete agreement and understanding among the parties and supersede and
preempt any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof
in any way.
2
<PAGE> 3
(c) Counterparts. This Agreement may be executed in
separate counterparts, each of which is deemed to be an original and all of
which taken together constitute one and the same agreement.
(d) Successors and Assigns. Except as otherwise provided
herein, this Agreement shall bind and inure to the benefit of and be
enforceable by the Optionee, Masland and their respective successors and
assigns; provided that the rights and obligations of the Optionee under this
Agreement shall not be assignable without the prior written consent of Masland.
(e) Choice of Law. The corporate law of Delaware will
govern all questions concerning the relative rights of Masland and the
Optionee. All other questions concerning the construction, validity and
interpretation of this Agreement will be governed by and construed in
accordance with the internal laws of Michigan, without giving effect to any
choice of law or conflict of law provision or rule (whether of Michigan or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than Michigan.
(f) Remedies. Each of the parties to this Agreement will
be entitled to enforce its rights under this Agreement specifically, to recover
damages and costs (including attorneys' fees) caused by any breach of any
provision of this Agreement and to exercise all other rights existing in its
favor. The parties hereto agree and acknowledge that money damages may not be
an adequate remedy for any breach of the provisions of this Agreement and that
any party may in its sole discretion apply to any court of law or equity of
competent jurisdiction (without posting any bond or other security) for
specific performance and/or other injunctive relief in order to enforce or
prevent any violations of the provisions of this Agreement.
(g) Amendment and Waiver. The provisions of this
Agreement may be amended and/or waived only with the written consent of
Masland.
(h) Headings. Section and subsection headings are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purposes or be given substantive effect.
[signature page follows]
3
<PAGE> 4
IN WITNESS WHEREOF, the parties hereto have executed this Option
Cancellation Agreement on the date first written above.
MASLAND CORPORATION
By: _________________________________
Its: _________________________________
OPTIONEE:
__________________________________________
[Optionee]
With respect to options granted under the 1991 Plan and held by the Optionee,
the grant date, exercise price and number of Shares subject to the option, and
the number of Shares elected to be cancelled:
<TABLE>
<CAPTION>
Number of Option Number of Option
Grant Date Exercise Price Shares Granted Shares to be Cancelled
---------- -------------- ------------------ ----------------------
<S> <C> <C> <C>
_________ ____________ [___________] ___________________
_________ ____________ [___________] ___________________
_________ ____________ [___________] ___________________
</TABLE>
4
<PAGE> 1
EXHIBIT 5.1
[Letterhead of Winston & Strawn]
June 18, 1996
Lear Corporation
21557 Telegraph Road
Southfield, MI 48034
Re: Registration Statement on Form S-8 of Lear
Corporation (the "Registration Statement")
Ladies and Gentlemen:
We have acted as special counsel for Lear Corporation, a
Delaware corporation (the "Company"), in connection with the registration on
Form S-8 of up to 1,442,764 shares (the "Shares") of the Company's Common Stock,
par value $.01 per share ("Common Stock"), issuable upon exercise of certain
stock options that may be assumed pursuant to the Masland Corporation 1993 Stock
Option Incentive Plan and the Masland Holdings, Inc. 1991 Stock Purchase and
Option Plan (collectively, the "Masland Stock Option Plans") after the Masland
Stock Option Plans are assumed by the Company.
This opinion is delivered in accordance with the requirements
of Item 601(b)(5) of Regulation S-K.
In connection with this opinion, we have examined and are
familiar with originals or copies, certified or otherwise identified to our
satisfaction, of (i) the Registration Statement, as filed with the Securities
and Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Act"); (ii) the Restated Certificate of Incorporation of the
Company, as currently in effect; (iii) the Amended and Restated By-Laws of the
Company, as currently in effect; and (iv) resolutions of the Board of Directors
of the Company relating to, among other things, the issuance of the Common Stock
and the filing of the Registration Statement. We have also examined such other
documents as we have deemed necessary or appropriate as a basis for the opinion
set forth below.
In our examination, we have assumed the legal capacity of all
natural persons, the genuineness of all signatures, the authenticity of all
documents submitted to us as certified or photostatic copies, and the
<PAGE> 2
Lear Corporation
June 17, 1996
Page 2
authenticity of the originals of such latter documents. We have also assumed
that the Company's Board of Directors, or a duly authorized committee thereof,
will have approved the assumption or issuance of each option to receive Common
Stock prior to the assumption or issuance thereof. As to any facts material to
this opinion which we did not independently establish or verify, we have relied
upon oral or written statements and representations of officers and other
representatives of the Company and others.
Based upon and subject to the foregoing, we are of the opinion
that all Shares issued pursuant to the Masland Stock Option Plans will be, upon
payment of the specified exercise price therefor, legally issued, fully paid
and nonassessable shares of Common Stock of the Company.
We hereby consent to the filing of this opinion with the
Commission as an exhibit to the Registration Statement. In giving such
consent, we do not concede that we are experts within the meaning of the Act or
the rules and regulations thereunder or that this consent is required by
Section 7 of the Act.
Very truly yours,
/s/ WINSTON & STRAWN
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated February 6, 1996
included in Lear Corporation's (formerly known as Lear Seating Corporation)
Form 10-K for the year ended December 31, 1995, and to all references to our
firm included in this registration statement.
/s/ Arthur Andersen LLP
Detroit, Michigan
June 11, 1996
