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EXHIBIT 10.b
MASCO CORPORATION
EXECUTIVE STOCK PURCHASE PROGRAM
1. Purpose. The purpose of the Masco Corporation Executive Stock Purchase
Program (the "Plan") is to facilitate the immediate purchase, by key
employees and the Directors of and certain consultants to Masco Corporation
("Masco") and its subsidiaries (collectively, the "Company"), of Masco's
Common Stock (the "Common Stock"). The purchases facilitated by the Plan
are intended to achieve the following:
a. Increasing the ownership of Common Stock among key management of the
Company;
b. More closely aligning financial rewards to key management with any
financial rewards realized by all other holders of Common Stock; and
c. Increasing the motivation of key management to manage the Company as
owners.
2. Eligibility. To be eligible to participate in this Plan, in addition to the
Directors of the Company, an employee of or consultant to the Company shall
be designated as an "Eligible Participant" by the Compensation Committee of
the Board of Directors of Masco (the "Committee") prior to the date on
which Stock is to be purchased under this Plan (the "Purchase Date").
3. Participation. To become a Plan participant (a "Participant"), an Eligible
Participant shall satisfy the following requirements:
a. Submit a completed, signed and irrevocable agreement to purchase Stock
on the Purchase Date;
b. Complete and sign all necessary agreements and other documents relating
to the ESP Loan described in Section 5 hereof; and
c. Satisfy all other terms and conditions of participation specified in
this Plan.
The agreements and other documents specified in subsection 3(a), (b) and
(c) hereof shall be in such forms and shall be submitted at such times and
to such Eligible Participants as specified by the Committee or its
designee(s). No Eligible Participant shall be required to participate in
this Plan.
4. Responsibilities of the Committee. The Committee or its designee(s) shall
have the following responsibilities under this Plan:
a. Adoption, alteration, waiver and repeal of such administrative rules,
guidelines, practices and provisions of or governing this Plan as the
Committee shall, from time to time, deem advisable; interpretation of
the terms and provisions of this Plan (and any agreements relating
hereto); and supervision of the administration of this Plan;
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b. Selection of Eligible Participants;
c. Designation of Purchase Date;
d. Designation of minimum and maximum purchases under this Plan, either by
number of shares of Stock or by purchase price;
e. Determining whether any restricted share grant shall be made to a
Participant in conjunction with a purchase of shares of Stock under the
Plan; and
f. Negotiation of terms and conditions of the guaranty described in
Section 9 hereof and the Participant's reimbursement agreement with the
Company and promissory note to the Bank referred to herein.
5. Payment of Purchase Price. The purchase price for each share of Stock under
this Plan shall be determined by the Committee based on the reported
trading price of the Common Stock immediately prior to the Purchase Date or
on such formula as the Committee shall determine fairly reflects the fair
market value of the Common Stock at the time of purchase. Each Participant
shall deliver to the Company in cash one hundred percent (100%) of the
purchase price of the shares of Stock which such Participant has elected to
purchase under this Plan (the "Purchased Shares"). The payment must be made
at the time, place and manner specified by the Committee or its
designee(s).
Each Participant shall obtain an unsecured loan through a bank or banks
(the "Bank") to fund the purchase of the Purchased Shares -- the "ESP
Loan". Each Participant shall sign a letter of direction which shall direct
all ESP Loan proceeds to be paid directly to Masco in payment for the
Purchased Shares. Each Participant is responsible for satisfying all of the
lending requirements specified by the Bank to qualify for his or her ESP
Loan. Each Participant shall be fully obligated to repay to the Bank all
principal, interest and any early payment fees on the ESP Loan when due and
payable.
6. Registration of Shares. The Purchased Shares shall be registered in the
name of the Participant or the Participant's grantor trust.
7. Stockholder Rights. Subject to such rules as the Committee shall prescribe,
each Participant shall have all of the rights of a stockholder with respect
to the Purchased Shares, including the right to vote the shares and the
right to receive all dividends paid on the Purchased Shares.
8. Sale of Purchased Shares. Each Participant shall be permitted to sell all
or any portion of the Purchased Shares at any time subject to adherence to
standard Company policy regarding employee and Director sales of stock.
9. Loan Guarantees. The Company shall guarantee repayment to the Bank of one
hundred percent (100%) of all principal, interest, early payment fees and
other obligations of each Participant under such Participant's ESP Loan
described in Section 5 hereof. The terms and conditions of the guaranty are
as agreed by Masco and the Bank. Each Participant shall be
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fully obligated to repay the Bank all principal, interest and other amounts
due in connection with such Participant's ESP Loan when due and payable.
The Company may take all actions relating to the Participant and his or her
assets which the Committee deems reasonable and necessary to obtain full
reimbursement for amounts the Company pays to the Bank under its guaranty
related to the Participant's ESP Loan.
10. Waiver and Amendment. The Committee may waive, amend, alter or discontinue
all or any provision of this Plan, but no waiver, amendment, alteration or
discontinuation shall be made which would impair the right of a Participant
without his or her consent.
11. This Plan is established under the Company's 1991 Long Term Stock Incentive
Plan.