Exhibit 10.3
LEAR CORPORATION
LONG-TERM STOCK INCENTIVE PLAN
2008 STOCK APPRECIATION RIGHTS (STOCK-SETTLED) TERMS AND CONDITIONS
     1. Definitions. Any term capitalized herein but not defined will have the
meaning set forth in the Plan.
     2. Term, Vesting and Exercise of the SAR.
     (a) If the Employee remains employed by the Company, the SAR will expire on
May 1, 2012. If the Employee terminates employment with the Company before
May 1, 2012, his or her right to exercise the SAR after termination of his or
her employment will be only as provided in Section 3.
(b) The SAR will vest and become exercisable as to one-half (1/2) of the Shares
to which the SAR relates on May 1, 2009 and as to one-half (1/2) of the Shares
to which the SAR relates on May 1, 2010; provided, however, that the portion of
the SAR scheduled to vest on May 1, 2010 will vest and become exercisable as to
all of the Shares to which that portion of the SAR relates on an accelerated
basis as of the date that is the later of (i) the end of the first
10-consecutive trading day period beginning after the Grant Date throughout
which the Fair Market Value of a Share has equaled or exceeded an amount
representing an increase of 100% from the Grant Price, or (ii) May 1, 2009.
Notwithstanding the foregoing, upon the Employee’s death or Disability, the SAR
will vest and become exercisable as to all of the Shares to which the SAR
relates. Notwithstanding anything contained herein to the contrary, the right of
an Employee to exercise the SAR will be forfeited if the Committee determines,
in its sole discretion, that (i) the Employee has entered into a business or
employment relationship which is detrimentally competitive with the Company or
substantially injurious to the Company’s financial interests; (ii) the Employee
has been discharged from employment with the Company or an Affiliate for Cause;
or (iii) the Employee has performed acts of willful malfeasance or gross
negligence in a matter of material importance to the Company or an Affiliate.
     (c) The SAR may be exercised by written notice to the Company indicating
the number of Shares to which the SAR relates being exercised. When the SAR is
vested and exercisable, it may be exercised in whole at any time or in part from
time to time as to any or all full Shares under the SAR. Notwithstanding the
foregoing, the SAR may not be exercised for fewer than 100 Shares at any one
time or, if fewer, all the Shares that are then subject to the SAR.
     (d) Any amount due to the Employee upon exercise of the SAR will be paid in
Shares. The number of Shares delivered to Employee upon exercise of the SAR will
be based on the amount, if any, by which the Fair Market Value of a Share on the
date of exercise exceeds the grant price (“Grant Price”) of the SAR. The
Employee will not receive a distribution of

 

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Shares if the Fair Market Value on the date of exercise does not exceed the
Grant Price. The Employee’s distribution of Shares upon exercise of the SAR will
be calculated by dividing (x) the aggregate dollar difference between the Fair
Market Value of a Share on the date of exercise and the Grant Price for all
SAR’s so exercised by (y) the Fair Market Value of a Share on the date of
exercise; provided, that the amount of Shares delivered to Employee shall be
subject to any minimum withholding as specified in clause 4 hereof.
     3. Termination of Employment. Subject to the forfeiture provisions in
clause 2(b) above, an Employee’s right to exercise the SAR after termination of
his or her employment will be only as follows:
     (a) End of Service. If the Employee experiences an End of Service Date, the
Employee will forfeit the SAR to the extent that it was not vested and
exercisable as of the End of Service Date and the Employee will have the right
for thirteen months following his or her End of Service Date (but not later than
the date on which the SAR would otherwise expire), to exercise the portion of
the SAR that was vested as of the End of Service Date. If the Employee dies
prior to the end of the thirteen-month period after the End of Service Date, his
or her estate will have the right to exercise the SAR within thirteen months
following the Employee’s End of Service Date (but not later than the date on
which the SAR would otherwise expire). The Employee’s “End of Service Date” is
the date of his or her retirement after attaining age 55 and completing ten
years of service (as defined in the Lear Corporation Pension Plan, regardless of
whether the Employee participates in such plan).
     (b) Disability or Death. If an Employee’s employment with the Company and
all Affiliates terminates due to Disability or death, the SAR will immediately
vest and become exercisable as to all Shares to which the SAR relates, and the
Employee (or in the case of death, the Employee’s estate) will have the right
for a period of thirteen months following the date of the termination (but not
later than the date on which the SAR would otherwise expire) to exercise the
SAR.
     (c) Other Termination. If an Employee’s employment with the Company and all
Affiliates terminates due to any reason other than those provided in clauses
3(a) or (b), the Employee or his or her estate (in the event of his or her death
after the Employee’s termination): (i) may, within the 60-day period following
the termination, exercise the SAR to the extent that it was vested and
exercisable on the date his or her employment terminated; and (ii) will forfeit
the SAR to the extent that it was not vested and exercisable on the date his or
her employment terminated.
     4. Medium and Time of Payment. Any withholding tax, up to the minimum
withholding requirement for supplemental wages may be paid with Shares issueable
to the Employee upon exercise under this SAR. Shares used to satisfy any minimum
required withholding tax will be valued at their Fair Market Value as of the
date of exercise.

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     5. Transferability of SAR and Shares Acquired Upon Exercise of SAR. This
SAR is transferable only by will or the laws of descent and distribution, or
pursuant to a domestic relations order (as defined in Code Section 414(p)). The
SAR will be exercisable during the Employee’s lifetime only by the Employee or
by his or her guardian or legal representative. The Committee may, in its
discretion, require a guardian or legal representative to supply it with
evidence the Committee deems necessary to establish the authority of the
guardian or legal representative to exercise the SAR on behalf of the Employee.
Except as limited by applicable securities laws and the provisions of Section 6
hereof, Shares acquired upon exercise of this SAR will be freely transferable.
     6. Securities Law Requirements.
     (a) If required by the Company, the notice of exercise of the SAR must be
accompanied by the Employee’s written representation: (i) that the stock being
acquired is purchased for investment and not for resale or with a view to its
distribution; (ii) acknowledging that the stock has not been registered under
the Securities Act of 1933, as amended (the “1933 Act”); and (iii) agreeing that
the stock may not be sold or transferred unless either there is an effective
Registration Statement for it under the 1933 Act, or in the opinion of counsel
for the Company, the sale or transfer will not violate the 1933 Act. This SAR
will not be exercisable in whole or in part, nor will the Company be obligated
to sell or issue any Shares subject to the SAR, if exercise and sale (or
issuance) may, in the opinion of counsel for the Company, violate the 1933 Act
(or other federal or state statutes having similar requirements), as it may be
in effect at that time, or cause the Company to violate the terms of Section 4.1
of the Plan.
     (b) The SAR is subject to the further requirement that, if at any time the
Committee determines in its discretion that the registration, listing or
qualification of the Shares subject to the SAR under any federal securities law,
securities exchange requirements or under any other applicable law, or the
consent or approval of any governmental regulatory body, is necessary as a
condition of, or in connection with, the granting of the SAR or the issuance of
Shares under it, the SAR may not be exercised in whole or in part, unless the
necessary registration, listing, qualification, consent or approval has been
effected or obtained free of any conditions not acceptable to the Committee.
     (c) No person who acquires Shares pursuant to this SAR 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
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 SAR 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 SAR 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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     7. No Obligation to Exercise SAR. The granting of the SAR imposes no
obligation upon the Employee (or upon a transferee of an Employee) to exercise
the SAR.
     8. No Limitation on Rights of the Company. The grant of the SAR 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.
     9. Plan and SAR Not a Contract of Employment. Neither the Plan nor this SAR
is a contract of employment, and no terms of employment of the Employee will be
affected in any way by the Plan, this SAR or related instruments except as
specifically provided therein. Neither the establishment of the Plan nor this
SAR 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.
     10. Employee to Have No Rights as a Stockholder. The Employee will have no
rights as a stockholder with respect to any Shares subject to the SAR prior to
the date on which he or she is recorded as the holder of those Shares on the
records of the Company.
     11. No Deferral Rights. Notwithstanding anything in Article 12 of the Plan
to the contrary, there shall be no deferral of payment, delivery or receipt of
any amounts hereunder.
     12. 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.
     13. Governing Law. This document and the SAR will be construed and enforced
in accordance with, and governed by, the laws of the State of Delaware,
determined without regard to its conflict of law rules.
     14. Plan Document Controls. The rights granted under this SAR 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 herein. If the terms of
this document or the SAR conflict with the terms of the Plan document, the Plan
document will control.

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