EXHIBIT 10.4
LEAR CORPORATION
LONG-TERM STOCK INCENTIVE PLAN
SUPPLEMENTAL RESTRICTED STOCK UNIT TERMS AND CONDITIONS
1. Definitions. Any term capitalized herein but not defined will
have the meaning set forth in the Plan.
2. Grant and Vesting of Restricted Stock Units.
(a) As of the Grant Date specified in the letter that accompanies
this document, the Employee will be credited with the number of Restricted Stock
Units set forth in the letter that accompanies this document. Each Restricted
Stock Unit is a notional amount that represents one unvested share of Common
Stock, $0.01 par value, of the Company (the "Common Stock"). Each Restricted
Stock Unit constitutes the right, subject to the terms and conditions of the
Plan and this document, to distribution of a Share if and when the Restricted
Stock Unit vests. If the Employee's employment with the Company and all of its
Affiliates terminates before the date that all of the Restricted Stock Units
vest, his or her right to receive the Shares underlying unvested Restricted
Stock Units will be only as provided in Section 4.
(b) Subject to Section 4, the Restricted Stock Units will vest on
the first anniversary of the Grant Date.
3. Rights as a Stockholder.
(a) Unless and until a Restricted Stock Unit has vested and the
Share underlying it has been distributed to the Employee, the Employee will not
be entitled to vote that Share.
(b) If the Company declares a cash dividend on its common stock,
then, on the payment date of the dividend, the Employee will be credited with
dividend equivalents equal to the amount of cash dividend per share multiplied
by the number of Restricted Stock Units credited to the Employee through the
record date. The dollar amount credited to an Employee under the preceding
sentence will be credited to an account ("Account") established for the Employee
for bookkeeping purposes only on the books of the Company. The amounts credited
to the Account will be credited as of the last day of each month with interest,
compounded monthly, until the amount credited to the Account is paid to the
Employee. The rate of interest credited under the previous sentence will be the
prime rate of interest as reported by the Midwest edition of the Wall Street
Journal for the second business day of each quarter on an annual basis. The
balance in the Account will be subject to the same terms regarding vesting and
forfeiture as the Employee's Restricted Stock Units awarded under the
accompanying letter and this document, and will be paid in cash in a single sum
at the time that the Shares associated with the Employee's Restricted Stock
Units are delivered (or forfeited at the time that the Employee's Restricted
Stock Units are forfeited).
4. Termination of Employment. Subject to the forfeiture provisions
of clause 2(b) above, if an Employee's employment with the Company shall
terminate for any reason, the Employee (or his or her beneficiary under the
Plan) will be entitled to receive the Shares underlying one-twelfth of the
Restricted Stock Units for every completed month between the Grant Date and the
date of termination.
5. Timing and Form of Payment. Except as provided in this Section or
in clause 2(b) or Section 4, once a Restricted Stock Unit vests, the Employee
will be entitled to receive a Share in its place. Delivery of the Share will be
made as soon as administratively feasible after its associated Restricted Stock
Unit vests. Shares will be credited to an account established for the benefit of
the Employee with the Company's administrative agent. The Employee will have
full legal and beneficial ownership with respect to the Shares at that time.
6. [reserved]
7. Assignment and Transfers. The Employee may not assign, encumber
or transfer any of his or her rights and interests under the Award described in
this document, except, in the event of his or her death, by will or the laws of
descent and distribution.
8. Withholding Tax. The Company and any Affiliate will have the
right to retain Shares or cash that are distributable to the Employee hereunder
to the extent necessary to satisfy any withholding taxes, whether federal or
state, triggered by the distribution of Shares or cash pursuant to the Award
reflected in this document.
9. Securities Law Requirements.
(a) The Restricted Stock Units are subject to the further
requirement that, if at any time the Committee determines in its discretion that
the listing or qualification of the Shares subject to the Restricted Stock Units
under any securities exchange requirements or under any applicable law, or the
consent or approval of any governmental regulatory body, is necessary as a
condition of, or in connection with, the issuance of Shares under it, then
Shares will not be issued under the Restricted Stock Units, unless the necessary
listing, qualification, consent or approval has been effected or obtained free
of any conditions not acceptable to the Committee.
(b) No person who acquires Shares pursuant to the Award reflected in
this document may, during any period of time that person is an affiliate of the
Company (within the meaning of the rules and regulations of the Securities and
Exchange Commission under the Securities Act of 1933 (the "1933 Act")) sell the
Shares, unless the offer and sale is made pursuant to (i) an effective
registration statement under the 1933 Act, which is current and includes the
Shares to be sold, or (ii) an appropriate exemption from the registration
requirements of the 1933 Act, such as that set forth in Rule 144 promulgated
under the 1933 Act. With respect to individuals subject to Section 16 of the
Exchange Act, transactions under this Award are intended to comply with all
applicable conditions of Rule 16b-3, or its successors under the Exchange Act.
To the extent any provision of the Award or action by the Committee fails to so
comply, the Committee may determine, to the extent permitted by law, that the
provision or action will be null and void.
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10. No Limitation on Rights of the Company. The grant of the Award
described in this document will not in any way affect the right or power of the
Company to make adjustments, reclassification or changes in its capital or
business structure, or to merge, consolidate, dissolve, liquidate, sell or
transfer all or any part of its business or assets.
11. Plan, Restricted Stock Units and Award Not a Contract of
Employment. Neither the Plan, the Restricted Stock Units nor any other right or
interest that is part of the Award reflected in this document is a contract of
employment, and no terms of employment of the Employee will be affected in any
way by the Plan, the Restricted Stock Units, the Award, this document or related
instruments, except as specifically provided therein. Neither the establishment
of the Plan nor the Award will be construed as conferring any legal rights upon
the Employee for a continuation of employment, nor will it interfere with the
right of the Company or any Affiliate to discharge the Employee and to treat him
or her without regard to the effect that treatment might have upon him or her as
an Employee.
12. Employee to Have No Rights as a Stockholder. Except as provided
in Section 3 above, the Employee will have no rights as a stockholder with
respect to any Shares subject to the Restricted Stock Units prior to the date on
which he or she is recorded as the holder of those Shares on the records of the
Company.
13. Notice. Any notice or other communication required or permitted
hereunder must be in writing and must be delivered personally, or sent by
certified, registered or express mail, postage prepaid. Any such notice will be
deemed given when so delivered personally or, if mailed, three days after the
date of deposit in the United States mail, in the case of the Company to 21557
Telegraph Road, P. O. Box 5008, Southfield, Michigan, 48086-5008, Attention:
General Counsel and, in the case of the Employee, to the last known address of
the Employee in the Company's records.
14. Governing Law. This document and the Award will be construed and
enforced in accordance with, and governed by, the laws of the State of Michigan,
determined without regard to its conflict of law rules.
15. Plan Document Controls. The rights granted under this Restricted
Stock Unit document are in all respects subject to the provisions of the Plan to
the same extent and with the same effect as if they were set forth fully
therein. If the terms of this document or the Award conflict with the terms of
the Plan document, the Plan document will control.
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