EXHIBIT 10.13
LEGGETT & PLATT, INCORPORATED
EXECUTIVE STOCK PURCHASE PROGRAM
(Adopted on June 6, 1989 and Effective as of July 1, 1989,
Including Amendments Through October 9, 1998)
1. Establishment of Program. Pursuant to the terms of the Company's 1989
Flexible Stock Plan ("Plan"), the Flexible Stock Plan Committee ("Plan
Committee") hereby establishes the Leggett & Platt, Incorporated Executive Stock
Purchase Program ("Program"). Under the Program, certain Employees will be
granted cash awards ("Cash Awards") which will be subject to the terms and
conditions contained in this Program. Each Cash Award shall be evidenced by a
Cash Award Agreement between the Company and the Participant ("Cash Award
Agreement"). All capitalized terms used in this Program and in any Cash Award
Agreement shall, unless otherwise provided, have the same meaning as in the
Plan.
2. Administration. Under the Plan, the Plan Committee is responsible for
overall administration of the Plan. The Plan Committee has full power and
authority to:
(a) Determine the individuals to whom Benefits are granted under the
Plan and the time, type, amount, terms and conditions of all Benefits granted
under the plan;
(b) Convert, modify or accelerate any Benefit or waive any condition
applicable to a Benefit; and
(c) Delegate its authorities to any employee, employees or committee
except with respect to Benefits for persons who are subject to Section 16 of the
Securities
Exchange Act of 1934 and rules and regulations promulgated thereunder (Section
16 Persons").
Except with respect to Section 16 Persons, the Plan Committee has delegated its
authorities with respect to the Program to a Management Committee ("Management
Committee") which presently consists of Harry M. Cornell, Jr., Felix E. Wright,
Michael A. Glauber, John Hale and Ernest C. Jett. The Plan Committee shall
retain all of its authorities with respect to the participation of Section 16
Persons in the Program.
3. Eligibility. The Plan Committee shall determine which Section 16 Persons
are eligible to participate in the Program. The Management Committee shall
determine all other persons who are eligible. It is contemplated that
eligibility will generally be limited to Employees who are "highly compensated
employees" under Section 414(q) of the Code.
4. Plan Committee and Management Committee. Unless expressly otherwise
provided, in the following portions of this Program, the term "Committee" shall
mean the Plan Committee with respect to Benefits and other matters relating to
Section 16 Persons in the Program and shall mean the Management Committee with
respect to Benefits and other matters relating to all other Participants in the
Program.
5. Condition Precedent to Award. Each Cash Award is conditioned upon the
Participant's agreement to contribute an amount ("Participant's Contribution")
to the Company's 1989 Discount Stock Plan ("Discount Plan"). The maximum
Participant's Contribution shall be the greater of (a) the Participant's
contribution, if any, to the Company's Employee Stock Purchase/Stock Bonus Plan
("SP/SB Plan") for 1988 or, if the Participant participated in the Company's
special match arrangement in 1988, the
maximum amount the Participant would have been permitted to contribute to the
SP/SB Plan for 1988 if he had been a participant in the SP/SB Plan in 1988 or
(b) 5.7% of the Participant's Compensation for the Fiscal Year (as defined
below) in excess of $18,000 (which $18,000 amount may be increased by the
Committee for Fiscal Years after 1989). For purposes of the preceding sentence,
a participant's "compensation for the Fiscal Year" shall include remuneration
for such Fiscal Year which would have been received in cash but for the
Participant's election to (a) defer such remuneration in accordance with the
terms of any deferred compensation agreement between the Participant and the
Company or any deferred compensation plan or program of the Company (other than
one which meets the requirements of Section 401(a) and Section 401(k) of the
Code) which covers the Participant or (b) receive a discount stock option in
lieu of such remuneration in accordance with the terms of any stock option
agreement between the Participant and the Company or any stock option plan or
program of the Company. Any subsequent cash remuneration or non-cash benefits
derived from amounts considered as compensation by virtue of the preceding
sentence shall not be considered compensation even if includible in the
Participant's gross income or deductible by the Company as such. A discount
stock option is a stock option with an exercise price below the fair market
value of the stock on the date the option is granted. The Participant's
Contribution shall be set forth in the Cash Award Agreement and shall be made in
the number of installments, in the amounts and/or percentages, and over the time
period set forth in the Cash Award Agreement. The Participant's Contribution
shall be used to purchase Common Stock under, and in accordance with the terms
of, the Discount Plan. A Participant may cease or resume making his
Participant's Contribution and decrease or increase the amount of
his Participant's Contribution only with the consent of the Committee, or if and
to the extent permitted by guidelines adopted by the Committee.
[SECTION 5 AMENDED 9/30/94]
6. Cash Award. Each Cash Award shall be (a) an amount (net of any "gross
up" described below) equal to 50% of the Participant's Contribution ("Basic
Award") plus (b) (subject to the provisions of paragraph 13) an additional
amount (net of any "gross up" described below) as provided hereafter. Said
additional amount ("Additional Award") shall be equal to 50% of the
Participant's Contribution if the Company meets an earnings target of a return
on adjusted average equity of 12.5%. Should the Company fail to achieve the
above-referenced earnings target but still have net earnings for the Fiscal
Year, said Additional Award shall be equal to a percentage of Participant's
Contribution that is the same percentage as is granted for such fiscal year as
an additional contribution under Section 3.02 of the Company's Restated Employee
Stock Purchase/Stock Bonus Plan.
Subject to the provisions of paragraph 13: each Basic Award shall be
payable at the times and in the amounts set forth in the applicable Cash Award
Agreement; and each Additional Award shall be payable on or about the date set
forth in the applicable Cash Award Agreement. A Cash Award may include a "gross
up" determined by the Committee which shall reimburse the Participant for some
or all of the federal and state income taxes applicable to such Cash Award. The
provisions of paragraph 7 shall be applicable only to the portion of the Basic
Award and Additional Award in excess of the gross up.
[SECTION 6 AMENDED 11/13/91]
7. Investment of Award. Each Basic Award and Additional Award shall be
contributed by the Company to the Discount Plan on behalf of the Participant and
used to purchase Common Stock for the Participant under the Discount Plan.
8. Other Conditions of Award. The grant of each Cash Award may, at the
Committee's discretion, be subject to the following additional conditions:
(a) Reinvestment of Dividends. All cash dividends on Common Stock
purchased through this Program, including shares purchased with the
Participant's Contributions, Cash Awards, interest and prior dividend
reinvestment, shall be used to purchase Common Stock to the extent permitted by
the Discount Plan. At the Participant's option, the amount of dividends to be
reinvested shall be net of federal and state income tax withholding. The amount
of such withholding shall be determined by the Committee in accordance with
procedures established by the Committee. (The Common Stock purchased with the
Participant's Contribution, the Cash Award and reinvested dividends is
collectively called the "Purchased Common Stock.")
(b) Stock Not Transferable. Except as otherwise provided in paragraph
21, Purchased Common Stock may not be transferred, pledged or otherwise disposed
of by the Participant until it is no longer subject to repurchase pursuant to
paragraph 20 and until the earlier of (i) the Participant's death, total and
permanent disability, retirement, or other termination of employment or (ii)
such time as the Committee shall determine.
[SECTION 8(b) AMENDED 9/30/94]
(c) Possession and Restriction. Until Purchased Common Stock is no
longer nontransferable, certificates for such Common Stock may be held by such
person
or entity as the Committee shall select and may be marked with such legend as
the Committee shall determine.
9. No Offering Under Discount Plan. If, at the time any amount is
required by this Program to be used to purchase Common Stock under the Discount
Plan, there is no Offering under the Discount Plan for which the Participant is
eligible or under which he may then purchase Common Stock, such amount (and any
property purchased directly or indirectly with such amount or earnings on, or
proceeds from, such amount or property) shall be invested or held as directed by
the Committee. In such case, for purposes of subparagraphs 8(b) and 8(c) above
and paragraph 10 below, such amount and property (and any property purchased
directly or indirectly with such amount or earnings on, or proceeds from, such
amount or property) shall be considered Purchased Common Stock.
10. Trust or Custodial Account. The Committee shall have the right at any
time to establish a trust, custodial account or other arrangement to hold
certificates for Purchased Common Stock which is nontransferable upon such terms
as it deems appropriate and which are not in conflict with the Plan or this
Program.
11. Adjustment. In the event of any change in the Common Stock of the
Company described in Section 3.3 of the Plan, the Committee shall have the right
to make such amendments to any Cash Award Agreement as it shall deem necessary
to carry out the purposes of this Program.
12. Authority and Further Steps. The Participant's execution of a Cash
Award Agreement shall constitute his authorization for all contributions to be
made on his behalf to the Discount Plan as described in this Program. In
addition to the Cash Award
Agreement, the Participant shall execute such additional documents and take all
steps as the Committee shall request in order to effectuate the provisions of
this Program.
13. Vesting and Termination of Employment. All shares purchased with Cash
Awards vest after a Participant has five (5) years of "Vesting Service" as
defined below. A year of Vesting Service is defined as (i) any calendar year in
which Participant completes 1,000 hours of service (any hour for which
Participant is paid by the Company, including without limitation hours paid for
vacation, illness or disability) except any year when Participant is eligible to
make contributions to this program or the Employee Stock Purchase/Stock Bonus
Plan but declined to make any such contributions; and (ii) if Participant was
employed by a company or division acquired by the Company, Participant's service
for purposes of vesting will begin on the date of the Company's acquisition.
In the event of termination of the Participant's employment, for any
reason, prior to the withholding and contribution to the Discount Plan of the
Participant's Contribution, the last installment of any Basic Award which is
payable shall be the installment payable on or immediately prior to the date of
the final Participant's Contribution. In the event of termination of the
Participant's employment, for any reason, prior to December 31 of any year, any
Additional Award for that year which has not been paid will be forfeited unless
(a) such termination (i) was because of permanent and total disability or death
or (ii) occurred on or after the Participant attained 60 years of age or
attained 55 years of age and had at least five years of Vesting Service or (b)
the Cash Award Agreement provides otherwise.
[SECTION 13 AMENDED 10/9/98]
14. Participation in Discount Plan. This Program shall not be deemed to be
an amendment to the Discount Plan nor shall it affect the terms and conditions
of the Discount Plan which are applicable to the Participant's participation in
the Discount Plan. This Program relates solely to the terms and conditions of a
Cash Award granted under the Plan.
15. Assignment. Unless otherwise provided in the Cash Award Agreement, no
Cash Award shall be assignable by the Participant. Subject to the foregoing,
this Program and the Cash Award Agreement shall be binding up and inure to the
benefit of the Company, the Participant and their respective successors,
assigns, heirs and personal representatives.
16. Amendment. The Plan Committee may amend this Program at any time.
However, without the Participant's written consent, no such amendment made
pursuant to this paragraph 16 shall advisedly affect the terms and conditions of
a Cash Award that has previously been granted.
17. No Amendment of Plan. This Program shall not be deemed to be an
amendment of the Plan.
18. Future Grants. Nothing contained in this Program or any Cash Award
Agreement or other document shall require the grant of additional Cash Awards or
any other Benefit under the Plan or prohibit any other Benefit which is granted
from being a different Benefit or from being granted on different and/or
additional terms and conditions than those in this Program.
19. No Employment Contract. This Program shall not confer upon the
Participant any right of continued employment nor shall it interfere in any way
with the right of the Employer to terminate the Participant's employment at any
time.
20. Option to Repurchase. The Company shall have an option to buy all of a
Participant's Purchased Common Stock (and any property considered Purchased
Common Stock under paragraph 9) that has been purchased with a Cash Award. The
option price shall be $1, and the option must be exercised within 90 days
following the Participant's termination of employment. The above option applies
only to a Participant (a) who is under age 60 when his employment terminates,
(b) who has less than five years of Vesting Service when his employment
terminates and (c) whose employment is terminated for a reason other than
permanent and total disability or death. For purposes of determining a
Participant's length of employment, employment with an Employer prior to the
time that it became an Employer shall be disregarded. The foregoing provisions
of this paragraph 20 may be modified by the Cash Award Agreement.
Notwithstanding the foregoing, in the case of any Participant who is a Section
16 Person, the decision as to whether to exercise the option granted by this
paragraph 20 shall be made solely by the Plan Committee.
[SECTION 20 AMENDED 10/9/98]
21. Permissible Transfer of Stock. Notwithstanding the provisions of
paragraph 8(b), a Participant may transfer Purchased Common Stock which is no
longer subject to the repurchase option under paragraph 20 to a trust
established by the Participant as grantor if the following conditions are
satisfied:
(a) Terms of Trust. The trust must contain the following provisions:
(i) the Participant must have the right to amend the trust, in
whole or in part;
(ii) the Participant must have the right to revoke the trust, in
whole or in part; and
(iii) during the Participant's lifetime, the income and principal
of the trust may not be distributed or used for the benefit of
any person or entity other than the Participant.
(b) Agreement. The Participant and/or the trustee of the trust must
execute an agreement or agreements which contain such warranties, terms and
conditions as the Committee shall require. In the event that Purchased Common
Stock is transferred to a trust, in accordance with the provisions described
above, it shall remain subject to the terms and conditions of the program but
any reversion of ownership of the Purchased Common Stock from the trust to the
Participant, by full or partial revocation of the trust, distribution of the
Purchased Common Stock, or otherwise, shall not be considered a transfer under
the Program. In addition, in the event of any such transfer, the term
Participant shall, to the extent necessary to carry out the terms of the
Program, mean the trustee of any such trust and/or the trust itself.
[SECTION 21 ADDED 9/30/94]
22. Transfer of Stock Pursuant to Court Order. Notwithstanding the
provisions of paragraph 8(b), a Participant's Purchased Common Stock which is no
longer subject to the repurchase option under paragraph 20 (the "Vested
Purchased Common Stock") may be transferred pursuant to a Qualified Domestic
Relations Order (as defined below) to another person (the "Alternate Payee"). A
Qualified Domestic
Relations Order is a judgment, decree or order (including approval of a property
settlement agreement) made pursuant to a State domestic relations law (including
a community property law) which provides for the transfer of a Participant's
Vested Purchased Common Stock to the Alternate Payee, contains all information
necessary to permit such transfer, and does not impose a condition on the plan
which would conflict with any Plan provision. Upon the transfer of any Vested
Purchased Common Stock to an Alternate Payee pursuant to a Qualified Domestic
Relations Order, such stock shall no longer be subject to the terms and
conditions of the Plan.
[SECTION 22 ADDED 8/13/97]