EXHIBIT 10.1

 

STOCK OPTION AWARD

 

[NAME]

 

Congratulations!

 

On [date], Leggett & Platt, Incorporated (the “Company”) awarded you Stock
Options under the Company’s 1989 Flexible Stock Plan. You were granted an option
to buy              shares of the Company’s Common Stock at the price of [$] per
share.

 

The option will expire ten (10) years from the date of grant, will be subject to
the Terms and Conditions – Non-Qualified Stock Option Award attached and will
become exercisable as follows:

 

     May Be Purchased

--------------------------------------------------------------------------------

# of Shares

--------------------------------------------------------------------------------

   Not Before

--------------------------------------------------------------------------------

  Not After

--------------------------------------------------------------------------------

[33%]

   [1 year, 6 months from grant date]   [expiration date]

[33%]

   [2 years, 6 months from grant date]   [expiration date]

[34%]

   [3 years, 6 months from grant date]   [expiration date]

 

By signing below, you agree to abide by the attached Terms and Conditions —
Non-Qualified Stock Option Award. Before you exercise the Options, you must sign
and return one original of this page to:

 

Compensation Section

Human Resources Department

Leggett & Platt, Incorporated

#1 Leggett Road

Carthage, MO 64836.

 

The Company’s most recent Summary of the 1989 Flexible Stock Plan – Options is
also attached. The Annual Report to Shareholders is not included in this folder
but is available upon request to the Corporate Human Resources Department.

 

Designation of Beneficiary (optional): I designate the following person as my
beneficiary of this Stock Option Award.   

Name of Beneficiary

 

Accepted and Agreed:  

Signature of Participant

 

1

--------------------------------------------------------------------------------

TERMS AND CONDITIONS

OF

NON-QUALIFIED STOCK OPTION AWARD

 

DEFINITIONS

 

Committee    A Committee of non-employee directors (or their designees) who
administer the Stock Option Plan Exercise Price    The price per share as shown
on the Option Award times the number of shares to be exercised Expiration Date
   The last date on which shares may be purchased as shown on the Option Award
Fair Market Value    The number of shares of the Company’s common stock
delivered by Participant times the closing price of such stock on the trading
day immediately preceding the Option exercise date Option    The Non-Qualified
Stock Option Award and these Terms and Conditions Option Shares    The number of
shares of L&P Stock set out on the Option Award that may be purchased under the
Option Stock Option Plan    The Leggett & Platt, Incorporated 1989 Flexible
Stock Plan, as amended

 

1. Exercise of Option

 

The Option may be exercised in whole or in part. To exercise the Option, you
must deliver a signed exercise notice to the Company, a sample of which is
attached as Exhibit A. You should contact the Human Resources
Department-Compensation Section at (417) 358-8131 for assistance in exercising
the Option.

 

2. Payment of Exercise Price

 

Payment of the Exercise Price for Option Shares will be made to the Company
either:

 

  (a) in cash (cashier’s check, bank draft, or money order); or

 

  (b) by delivering L&P Stock owned by you (and held for at least six months)
having a Fair Market Value equal to the Exercise Price; or

 

  (c) by any combination of cash and L&P Stock.

 

The Exercise Price also may, with the consent of the Committee, be paid in whole
or in part in other property.

 

2

--------------------------------------------------------------------------------

3. Termination of Employment; Nonassignability

 

3.1 Termination of Employment. If your employment is terminated by reason of
discharge or voluntary quit, you may exercise the Option within 3 months after
such termination, but (i) only to the extent the Option was exercisable on the
termination date, and (ii) not later than the Expiration Date. However, if
employment is terminated “for cause,” your full interest in the Option will
terminate on such termination date and all rights to the Option will cease. “For
cause” means termination for any of the following reasons: (i) conviction of a
crime involving the theft or willful destruction of money or other property of
the Company or conviction of any crime involving moral turpitude or fraud; (ii)
continued and repeated violations of specific directions of the Company; or
(iii) dishonesty, willful gross neglect or willful gross misconduct in the
performance of duties.

 

3.2 Retirement. If your employment is terminated due to Retirement (as defined
below), your rights under the Option will continue to vest and become
exercisable until 3 months after the Retirement date (but not later than the
Expiration Date). You may exercise the Option within 1 year after the Retirement
date, but (i) only to the extent the Option was exercisable on the Retirement
date or becomes exercisable within 3 months after Retirement, and (ii) not later
than the Expiration Date. “Retirement” means you voluntarily quit (i) on or
after age 65, or (ii) on or after age 55 if you have at least 15 years of
service with the Company or any company or division acquired by the Company.

 

3.3 Disability. If your employment is terminated due to Disability (as defined
below), you may exercise the Option within 1 year after such termination, but
(i) only to the extent the Option was exercisable on the termination date, and
(ii) not later than the Expiration Date. “Disability” means the inability to
substantially perform your duties and responsibilities by reason of any accident
or illness that can be expected to result in death or to last for a continuous
period of not less than 1 year.

 

3.4 Death. If you die within the 3-month period referred to in Section 3.1 or
the 1-year periods referred to in Sections 3.2 and 3.3, or while employed by the
Company or a Subsidiary, the beneficiary designated pursuant to Section 3.6 may
exercise the Option within 1 year after your death, but (i) only to the extent
the Option was exercisable on the date of death, and (ii) no later than the
Expiration Date. If you have no designated beneficiary, the right to exercise
will extend to the personal representative of your estate or the person to whom
the Option has been transferred by will or the laws of descent and distribution.

 

No transfer of the Option, other than by filing a written designation of
beneficiary as provided in Section 3.6, will bind the Company unless the Company
has been furnished with written notice of the transfer and a copy of the will
and/or such other evidence as the Committee may require to establish the
validity of the transfer. No transfer will be effective unless the transferee
accepts the terms and conditions of the Option.

 

3.5 Leave of Absence. In determining whether your employment has been terminated
for purposes of exercising the Option, the employment relationship will be
treated as continuing intact while you are on military, sick leave or other bona
fide leave of absence if (i) the Company does not terminate the employment
relationship or (ii) your right to re-employment is guaranteed by statute or by
contract.

 

3

--------------------------------------------------------------------------------

3.6 Non-Transferability of Rights; Designation of Beneficiaries. You may not
transfer the Option except by will or the laws of descent and distribution or as
provided in this Section. During your lifetime, only you may exercise the
Option.

 

You may file with the Company a written designation of a beneficiary or
beneficiaries to exercise the Option in the event of your death. You may revoke
or change a beneficiary designation. Any such beneficiary designation will be
controlling over any other disposition; provided, however, that if the Committee
is in doubt as to the right of any such beneficiary to exercise the Option, the
Committee may determine to recognize only an exercise by the personal
representative of your estate.

 

4. Withholding

 

When you exercise the Option, the Company may withhold from the Option Shares
any amount required to satisfy applicable tax laws (at the Company’s required
withholding rate). Alternatively, you may elect to pay the taxes due in cash or
L&P Stock.

 

5. Noncompetition

 

For two years after you exercise any portion of this Option, you will not
directly or indirectly (i) engage in any Competitive Activity, (ii) solicit
orders from or seek or propose to do business with any customer of the Company
or its subsidiaries or affiliates (collectively, the “Companies”) relating to
any Competitive Activity, or (iii) influence or attempt to influence any
employee, representative or advisor of the Companies to terminate their
employment or relationship with the Companies. “Competitive Activity” means any
manufacture, sale, distribution, engineering, design, promotion or other
activity that competes with any business of the Companies in which you were
involved as an employee, consultant or agent.

 

If you violate the preceding paragraph, then you will pay to the Company any
Option Gain you realized from exercising all or any portion of this Option.
“Option Gain” is equal to (i) the number of shares purchased under the Option
times the closing price of L&P Stock on the trading day immediately preceding
the date the Option is exercised, minus (ii) the Exercise Price, and minus (iii)
any non-refundable taxes paid by you as a result of such exercise.

 

If any restriction in this section is deemed unenforceable, then you and the
Company contemplate that the appropriate court will reduce the scope or other
provisions and enforce the restrictions set out in this section in their reduced
form. The covenants in this Section are in addition to any similar covenants
under any other agreement between the Company and you.

 

6. Stock Option Plan Controls

 

The Option is subject to the Stock Option Plan, which is incorporated by
reference. In the event of any conflict, the Stock Option Plan will control over
the Option. All capitalized terms have the meanings given them in the Stock
Option Plan unless otherwise defined herein or unless the context clearly
indicates otherwise. Upon request, a copy of the Stock Option Plan will be
furnished to you.

 

4

--------------------------------------------------------------------------------

7. Non-Qualified Stock Option

 

The Option is not designed to be an “Incentive Stock Option” under Section 422
of the Internal Revenue Code. The Option is a non-qualified option.

 

8. Other

 

In the event of a Change of Control of the Company, all shares granted under the
Option Award will immediately become exercisable.

 

The Committee may in its discretion accelerate the time at which all or any part
of the Option becomes exercisable.

 

In the absence of any specific agreement to the contrary, the grant of the
Option to you will not affect any right of the Company or its Subsidiaries to
terminate your employment or your right to resign from employment.

 

The Option will be governed by the laws of Missouri, excluding any conflicts or
choice of law rule or principle that might otherwise refer construction or
interpretation of the Option to the substantive law of another jurisdiction.

 

5

--------------------------------------------------------------------------------

EXHIBIT A

 

NOTICE OF EXERCISE

 

To:    Human Resources Dept. – Compensation Section    VIA FACSIMILE     
Leggett & Platt, Incorporated    (417) 358-5840

 

No. 1 Leggett Road

Carthage, Missouri 64836

 

I hereby exercise my option to purchase                      shares of Leggett &
Platt, Incorporated (the “Company”) common stock in accordance with my Option
Award dated                     .

 

The Exercise Price is $                     (number of shares being purchased X
the price per share as shown on the Option Award). In payment of the Exercise
Price I have enclosed the following (check appropriate box(es)):

 

  ¨ a cashier’s check, bank draft or money order made payable to Leggett &
Platt, Incorporated for $_________.

 

  ¨ ________ shares of the Company’s common stock having a Fair Market Value of
$__________. “Fair Market Value” means the number of shares delivered in payment
of the Exercise Price times the closing price of the Company’s common stock on
the trading day immediately preceding the Option exercise date.

 

I represent to the Company that (i) I own the enclosed shares free and clear of
all liens and encumbrances, (ii) I have held the shares for at least six (6)
months, and (iii) I have the right to transfer the shares to the Company.

 

I understand the Company will withhold from the Option Shares any amount
required to satisfy applicable tax laws (at the Company’s required tax
withholding rate) unless I have previously notified the Company of my desire to
pay the tax withholding in cash.

 

  Signature

Print Name: _______________________________

Date: ______________________________________

 

NOTE: To properly transfer the shares you should (i) complete the back of the
certificate showing Leggett & Platt, Incorporated as the assignee, (ii) sign and
date the certificate, and (iii) have your signature guaranteed by a bank or
trust company or a member firm of a major stock exchange.

 

6