LOUISIANA-PACIFIC CORPORATION
1992 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
(Restated as of May 3, 1998)
1. PURPOSE. The continued growth and success of Louisiana-Pacific
Corporation (the "Corporation") are dependent upon the efforts of members of the
Corporation's board of directors (the "Board of Directors"). Those members of
the Board of Directors who are not employees of Corporation or any of its
subsidiaries ("Non- Employee Directors") are not eligible to participate in the
stock option and other stock incentive plans maintained for employees of the
Corporation. The purpose of this 1992 Non-Employee Director Stock Option Plan
(the "Plan") is to provide an incentive to Non- Employee Directors to remain as
members of the Board of Directors and also to afford them the opportunity to
acquire, or increase, stock ownership in the Corporation in order that they may
have a direct proprietary interest in its success. Options granted under the
Plan shall be nonqualified options which are not intended to qualify as
incentive stock options under Section 422 of the Internal Revenue Code.
2. STOCK. The stock subject to options granted under the Plan shall be
shares of the Corporation's authorized but unissued, or reacquired, $1 par value
common stock ("Common Stock"). The total number of shares of Common Stock with
respect to which options may be granted shall not exceed in the aggregate
1,200,000, provided that such aggregate number of shares shall be subject to
adjustment in accordance with the provisions of paragraph 6(g). In the event
that any outstanding option under the Plan shall be canceled or terminate or
expire prior to the end of the period during which options may be granted under
the Plan, the shares of Common Stock allocable to the unexercised portion of
such option may be made the subject of additional options granted under the
Plan.
3. ADMINISTRATION. The Plan shall be administered by the Board of
Directors which shall have full power and authority, subject to the provisions
of the Plan, to adopt, amend, and rescind rules and regulations for carrying out
the Plan. The interpretation and decision of the Board of Directors with regard
to any question arising under the Plan shall be final and conclusive. No member
of the Board of Directors shall be liable for any action taken or determination
made in good faith with
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respect to the Plan or to any options granted pursuant to the Plan.
4. ELIGIBILITY. The persons eligible to receive options under the Plan
are the Non-Employee Directors of the Corporation.
5. GRANT OF OPTIONS.
(a) INITIAL GRANT. Each person who is an Non-Employee Director on June
15, 1992, automatically shall be granted, as of June 15, 1992, an option to
purchase 22,500 shares of Common Stock, subject to the terms and conditions
described in paragraph 6.
(b) NEW NON-EMPLOYEE DIRECTORS. Each person who becomes a Non-Employee
Director after June 15, 1992, automatically shall be granted, as of the date
such person becomes a Non-Employee Director, an option to purchase 22,500 shares
of Common Stock (45,000 shares after May 18, 1993), subject to the terms and
conditions described in paragraph 6.
(c) SUBSEQUENT GRANTS. Each Non-Employee Director who has been granted
an option under paragraphs 5(a) or 5(b) who remains as a Non-Employee Director
on the fifth anniversary of the date such option was granted (the "Anniversary")
automatically shall be granted, as of such Anniversary, an option to purchase
45,000 shares of Common Stock, subject to the terms and condition described in
paragraph 6.
6. TERMS AND CONDITIONS OF OPTIONS. Each option granted pursuant to the
Plan shall be subject to the following terms and conditions:
(a) PAYMENT. Upon exercise of an option, in whole or in part, the
option price for shares to which the exercise relates may be made, at the
election of the optionee, either in cash or by delivering to the Corporation
shares of Common Stock having a Fair Market Value (as defined below) equal to
the option price, or any combination of cash and Common Stock having a combined
value equal to the option price. Shares of Common Stock may not be used in
payment or partial payment unless an option is being exercised for at least
2,000 shares. Payment in shares of Common Stock shall be made by delivering to
the Corporation certificates, duly endorsed for transfer, representing shares of
Common Stock having an aggregate Fair Market Value on the date of exercise equal
to that portion of the option price which is to be paid in Common Stock. The
Fair Market Value of a share of Common Stock on the date of exercise shall be
deemed to be the closing price per share of Common Stock on the New York Stock
Exchange on
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the date of exercise or, if no sale of Common Stock shall have been made on that
Exchange on that date, on the next preceding business day on which there was a
sale of such stock on that Exchange. Whenever payment of the option price would
require delivery of a fractional share, the optionee shall deliver the next
lower whole number of shares of Common Stock and a cash payment shall be made by
the optionee for the balance of the option price.
(b) OPTION PRICE. On and after May 3, 1998, the option price per share
for each option granted under the Plan shall be 100 percent of the Fair Market
Value per share on the date the option was granted.
(c) TERM OF OPTION. Each option shall expire ten years from the date
the option is granted, unless the option is terminated earlier in accordance
with the Plan.
(d) DATE OF EXERCISE. Unless an option is terminated or the time of its
exercisability is accelerated in accordance with the Plan, each option may be
exercised in whole or in part from time to time to purchase shares as follows:
Each option shall not be exercisable until the first anniversary
of the date the option was granted. On such first anniversary, the
option shall become exercisable as to 20 percent of the shares covered
by the option, and on each of the second through the fifth such
anniversaries, the option shall become exercisable as to an additional
20 percent of the shares covered by the option. However, no option
shall be exercisable in part with respect to a number of shares fewer
than 100.
(e) ACCELERATION OF EXERCISABILITY. Notwithstanding the limitations on
exercisability pursuant to paragraph 6(d), an option shall become immediately
and fully exercisable:
(i) In the event of the death of the optionee Non-Employee
Director; or
(ii) Upon the later of (A) the occurrence of a "Change in Control"
(as defined below) of the Corporation or (B) six months after the date
of grant; or
(iii) On the date an optionee Non-Employee Director retires
pursuant to Section 15 of the bylaws of
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the Corporation; provided, however, that this paragraph 6(e)(iii) shall only
apply to an additional 20 percent of the shares covered by such Non-Employee
Director's option.
For purposes of the Plan, a change of control shall be deemed to occur if (x)
any person or group, together with its affiliates and associates (other than the
Corporation or any of its subsidiaries or employee benefit plans), acquires
direct or indirect beneficial ownership of 20 percent or more of the then
outstanding shares of Common Stock or commences a tender or exchange offer for
30 percent or more of the then outstanding shares of Common Stock, or (y) the
Corporation is to be liquidated or dissolved. The terms "group," "affiliates,"
"associates" and "beneficial ownership" shall have the meanings ascribed to them
in the rules and regulations promulgated under the Exchange Act.
(f) CONTINUATION AS A DIRECTOR. Notwithstanding the option term
provided in paragraph 6(c), in the event that an optionee Non-Employee Director
ceases to be a member of the Board of Directors:
(i) By reason of death, the estate, personal representative, or
beneficiary of the Non-Employee Director shall have the right to
exercise the option at any time within 12 months from the date of death
and the option shall terminate as of the last day of such 12-month
period; or
(ii) By reason of the retirement of an optionee Non-Employee
Director pursuant to Section 15 of the bylaws of the Corporation, the
Non-Employee Director's option shall remain exercisable, to the extent
it had become exercisable on the date of said retirement, for a period
of 24 months following the date of said retirement and the option shall
terminate as of the last day of such 24-month period; or
(iii) For any other reason, the Non-Employee Director's option
shall remain exercisable, to the extent it had become exercisable on
the date the optionee ceased to be a member of the Board of Directors
(the "Termination Date"), for a period of three months following the
Termination Date and the option shall terminate as of the last day of
such three-month period.
(g) RECAPITALIZATION. In the event of any change in capitalization
which affects the Common Stock, whether by stock dividend, stock distribution,
stock split, subdivision or
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combination of shares, merger or consolidation or otherwise, such proportionate
adjustments, if any, as the Board of Directors in its good faith discretion
deems appropriate to reflect such change shall be made with respect to the total
number of shares of Common Stock in respect of which options may be granted
under the Plan, the number of shares covered by each outstanding option, and the
exercise price per share under each such option; however, any fractional shares
resulting from any such adjustment shall be eliminated.
A dissolution of the Corporation, or a merger or consolidation in which
the Corporation is not the resulting or surviving corporation (or in which the
Corporation is the resulting or surviving corporation but becomes a subsidiary
of another corporation), shall cause every option outstanding hereunder to
terminate concurrently with consummation of any such dissolution, merger or
consolidation, except that the resulting or surviving corporation (or, in the
event the Corporation is the resulting or surviving corporation but has become a
subsidiary of another corporation, such other corporation) may, in its absolute
and uncontrolled discretion, tender an option or options to purchase its shares
on terms and conditions, both as to number of shares and otherwise, which will
substantially preserve the rights and benefits of any option then outstanding
hereunder.
In the event of a change in the Corporation's presently authorized
Common Stock which is limited to a change of all its presently authorized shares
with par value into the same number of shares with a different par value or into
the same number of shares without par value, the shares resulting from any such
change shall be deemed to be Common Stock within the meaning of this Plan.
(h) TRANSFERABILITY. No option shall be assignable or transferable
other than by will or the laws of descent and distribution. During an optionee's
lifetime, only he or his guardian or legal representative may exercise any such
option or right.
(i) RIGHTS AS A STOCKHOLDER. An optionee Non-Employee Director shall
have no rights as a stockholder with respect to shares covered by the option
until the date of the issuance or transfer of the shares to him and only after
such shares are fully paid. Except as provided in paragraph 6(g), no adjustment
shall be made for dividends or other rights for which the record date is prior
to the date of such issuance or transfer.
(j) PROVISION FOR TAXES. It shall be a condition to the Corporation's
obligation to issue or reissue shares of Common Stock upon exercise of any
option that the optionee pay, or make provision satisfactory to the Corporation
for payment of, any
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federal and state income and other taxes which the Corporation is obligated to
withhold or collect with respect to the issue or reissue of such shares.
(k) OPTION AGREEMENT. Each option shall be evidenced by an option
agreement substantially in the form attached to the Plan as Appendix A.
7. EFFECTIVE DATE AND TERM OF PLAN. Options shall be granted pursuant
to the Plan from time to time beginning June 15, 1992, the date of adoption of
the Plan by the Board of Directors. The Plan shall continue in effect until
options have been granted covering all available shares of Common Stock as
specified in paragraph 2 or until the Plan is terminated by the Board of
Directors, whichever is earlier, except as provided below.
The Plan shall be subject to approval by the affirmative vote of the
holders of at least a majority of the securities of the Corporation present, or
represented by proxy, and entitled to vote at a meeting (to be duly held in
accordance with the applicable laws of the state of Delaware) for which proxies
are solicited substantially in accordance with rules and regulations, if any, as
are then in effect under Section 14(a) of the Exchange Act, which approval must
occur within twelve months after said date of adoption of the Plan by the Board
of Directors. Options granted pursuant to the Plan prior to such approval shall
be subject to such approval.
8. AMENDMENT OR TERMINATION. The Board of Directors may alter, amend,
suspend or terminate the Plan at any time. However, the Plan shall not be
amended more often than once every six months other than amendments to comport
with changes in income tax laws or the requirements of Rule 16b-3 under the
Exchange Act. Amendments to the Plan shall be subject to stockholder approval to
the extent required to comply with any exemption to the short swing profit
provisions of Section 16(b) of the Exchange Act pursuant to rules and
regulations promulgated thereunder or with the rules and regulations of any
securities exchange on which the Common Stock is listed. Expiration or
termination of the Plan shall not affect outstanding options except as provided
in paragraph 7. The Board of Directors may also modify the terms and conditions
of any outstanding option, subject to the consent of the optionee and consistent
with the provisions of the Plan.
9. APPLICATION OF PROCEEDS. The proceeds received by the Corporation
from the sale of Common Stock pursuant to options shall be available for general
corporate purposes.
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10. NO OBLIGATION TO EXERCISE OPTION. The granting of an option shall
impose no obligation upon the optionee to exercise the same, in whole or in
part.
11. RESTRICTIONS ON EXERCISE. Any provision of the Plan to the contrary
notwithstanding, no option granted pursuant to the Plan shall be exercisable at
any time, in whole or in part, (i)prior to the shares of Common Stock subject to
the option being authorized for listing on the New York Stock Exchange, or
(ii)if issuance and delivery of the shares of Common Stock subject to the option
would be in violation of any applicable laws or regulations.
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LOUISIANA-PACIFIC CORPORATION
1992 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
OPTION AGREEMENT
Date of Option Grant: --------------, 199-
Louisiana-Pacific Corporation
a Delaware corporation
111 S.W. Fifth Avenue
Portland, OR 97204 ("Corporation")
- ------------------------
- ------------------------
- ------------------------
- ------------------------ ("Optionee")
Corporation maintains the Louisiana-Pacific Corporation 1992
Non-Employee Director Stock Option Plan (the "Plan"). A copy of the Plan is
attached hereto as Exhibit A and is incorporated by reference in this Agreement.
Capitalized terms not otherwise defined in this Agreement have the meanings
given them in the Plan.
The Plan is administered by the Board for the benefit of Non-Employee
Directors of Corporation.
The parties agree as follows:
1. GRANT OF OPTION.
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Subject to the terms and conditions of this Agreement and the Plan,
Corporation grants, as of the date of option grant set forth above, to the
Optionee a stock option (the "Option") to purchase 45,000 shares of
Corporation's Common Stock at $------- per share.
2. TERMS OF OPTION.
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The option shall be subject to all the terms and conditions set forth
in the Plan.
3. CONDITIONS PRECEDENT.
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The Option is subject to stockholder approval pursuant to paragraph 7
of the Plan. Corporation will use its best efforts to obtain approval of the
Plan and the Option by any state or federal agency or authority that Corporation
determines has jurisdiction. If Corporation determines that any required
approval cannot be obtained, the Option shall terminate on notice to the
Optionee to that effect.
-1-
4. SUCCESSORSHIP.
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Subject to restrictions on transferability set forth in the Plan, this
Agreement shall be binding upon and benefit the parties, their successors and
assigns.
5. NOTICES.
-------
Any notices under the Option shall be in writing and shall be effective
when actually delivered personally or through Corporation interoffice mail
service, or, if mailed, when deposited as registered or certified mail directed
to the address of Corporation's records or to such other address as a party may
certify by notice to the other party. Notices to Corporation shall be sent to
the Treasurer of Corporation at Corporation's address set forth above, or at
such other address as Corporation, by written notice to Optionee, may designate
from time to time.
CORPORATION: LOUISIANA-PACIFIC CORPORATION
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Vice President, Treasurer
and Chief Financial Officer
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Secretary
OPTIONEE:
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