Document:

exv10w34

 

Exhibit 10.34

LEAR CORPORATION

LONG-TERM STOCK INCENTIVE PLAN

2007 MANAGEMENT STOCK PURCHASE PLAN (NON-U.S.)

TERMS AND CONDITIONS

1. Deferral Election.

     Any Eligible Employee selected by the Committee may irrevocably elect to defer any whole
percentage up to 100% of the bonus payable to him or her under the Company’s Senior Executive
Incentive Compensation Plan or Management Incentive Compensation Plan in the first quarter of 2007
by electronically submitting an online election to that effect (a “Deferral Election”) on the
appropriate screen following these Terms and Conditions. An Eligible Employee who makes a Deferral
Election shall be a Participant.

2. Restricted Stock Units.

	 	(a)	 	In consideration for the Participant’s Deferral Election, the Participant shall
be credited as of March 15, 2007, with Restricted Stock Units at a discounted price
(the “Discount Rate”) as provided in the following table:

	 	 	 	 	 
	Total dollar amount of Participant’s Deferral Election,	 	 
	expressed as a percentage of the Participant’s base salary	 	 
	as of January 1, 2007:	 	Applicable Discount Rate:
	15% or less
	 	 	20	%
	Over 15% and up to 100%
	 	 	30	%
	Over 100%
	 	 	20	%

	 	(b)	 	The total number of Restricted Stock Units credited to a Participant under the
Plan will be determined according to the following calculation:

	 	(i)	 	the dollar amount of the Participant’s Deferral Election that
does not exceed 15% of the Participant’s base salary, divided by the product of
(A) the average closing Fair Market Value over the last five trading
days in 2006 (December 22, 26, 27, 28 and 29) (the “Average FMV”) multiplied by
(B) 80%; plus
	 
	 	(ii)	 	the dollar amount of the Participant’s Deferral Election over
15% and up to 100% of the Participant’s base salary, divided by the product of
(A) the Average FMV multiplied by (B) 70%; plus

 

 

	 	(iii)	 	the dollar amount of the Participant’s Deferral Election over
100% of the Participant’s base salary, divided by the product of (A) the
Average FMV multiplied by (B) 80%.

3. Restriction Period.

     The Restriction Period under this Agreement shall be the three-year period commencing on March
15, 2007, and ending on March 14, 2010.

4. Dividend Equivalents.

     If the Company declares a cash dividend on Shares, the Participant shall be credited with
dividend equivalents as of the payment date for the dividend equal to the amount of the cash
dividend per Share multiplied by the Restricted Stock Units credited to the Participant under
Section 2(b) as of the record date. Dividend equivalents shall be credited to a notional account
established for the Participant (the “Dividend Equivalent Account”). Interest shall be credited to
the Participant’s Dividend Equivalent Account, compounded monthly, until payment of such account to
the Participant. The rate of such interest shall be the Prime Rate of interest as reported by the
Midwest edition of The Wall Street Journal on the second business day of each calendar quarter.

5. Timing and Form of Payout.

     Except as provided in Sections 6, 7 or 8, after the end of the Restriction Period, the
Participant shall be entitled to receive a number of Shares equal to the number of Restricted Stock
Units credited to the Participant under Section 2(b) and a cash payment equal to the amount
credited to the Participant’s Dividend Equivalent Account under Section 4. Delivery of such Shares
shall be made as soon as administratively feasible after the end of the Restriction Period or such
later date as may have been elected by the Participant under Section 9. Delivery of the cash
payment of any amount credited to the Participant’s Dividend Equivalent Account shall be made on or
about the date the Restricted Stock Units are distributed to the Participant.

6. Termination of Employment Due to Death, End of Service or Disability.

	 	(a)	 	Before March 15, 2007.
	 
	 	 	 	A Participant who ceases to be an employee prior to March 15, 2007, by reason of
death, End of Service or Disability shall be terminated from the Plan, and his or
her Deferral Election shall be cancelled.
	 
	 	(b)	 	After March 14, 2007 but Before January 1, 2008.
	 
	 	 	 	If the Participant ceases to be an employee after March 14, 2007, but prior to
January 1, 2008, by reason of death, End of Service or Disability, the Participant
(or in the case of the Participant’s death, the Participant’s beneficiary) shall be
entitled to receive a number of Shares equal to the number of Restricted Stock Units
credited to the Participant under Section 2(b).

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	 	(c)	 	After December 31, 2007.
	 
	 	 	 	If the Participant ceases to be an employee after December 31, 2007, but prior to
the end of the Restriction Period by reason of death, End of Service, or Disability,
the Participant (or in the case of the Participant’s death, the Participant’s
beneficiary) shall be entitled to receive a number of Shares equal to the number of
Restricted Stock Units credited to the Participant under Section 2(b) and a cash
payment equal to the Participant’s Dividend Equivalent Account under Section 4.
	 
	 	(d)	 	Beneficiary.
	 
	 	 	 	Any distribution made with respect to a Participant who has died shall be paid to
the beneficiary designated by the Participant pursuant to Article 11 of the Plan to
receive the Participant’s Shares and any cash payment under this Agreement. If the
Participant’s beneficiary predeceases the Participant or no beneficiary has been
designated, distribution of the Participant’s Shares and any cash payment shall be
made to the Participant’s surviving spouse and, if none, to the Participant’s
estate.
	 
	 	(e)	 	End of Service.
	 
	 	 	 	An employee’s “End of Service” means 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).

7. Involuntary Termination Other Than For Cause.

	 	(a)	 	Before March 15, 2007.
	 
	 	 	 	A Participant whose employment involuntarily terminates other than for Cause or for
any reason described in Section 6 prior to March 15, 2007, shall be terminated from
the Plan, and his or her Deferral Election shall be cancelled.
	 
	 	(b)	 	After March 14, 2007 but Before January 1, 2008.
	 
	 	 	 	A Participant whose employment involuntarily terminates other than for Cause or for
any reason described in Section 6 after March 14, 2007, but prior to January 1,
2008, shall be entitled to receive a number of Shares equal to the sum of (i) and
(ii):

	 	(i)	 	the number of Restricted Stock Units credited to the
Participant under Section 2(b) multiplied by a fraction, the numerator of which
is the Elapsed Months, and the denominator of which is 36; and
	 
	 	(ii)	 	the lesser of:

	 	(A)	 	the quotient of (i) the amount of bonus
deferred in the Participant’s Deferral Election multiplied by a
fraction, the numerator of which is 36 minus the Elapsed Months, and
the denominator of which is 36, divided by (ii) the Fair Market Value
of a Share on the date the Participant ceases to be an employee, or

3

 

	 	(B)	 	the number of Restricted Stock Units determined
under Section 2(b) multiplied by a fraction, the numerator of which is
36 minus the Elapsed Months, and the denominator of which is 36.

	 	(c)	 	After December 31, 2007.
	 
	 	 	 	A Participant whose employment involuntarily terminates other than for Cause or for
any reason described in Section 6 after December 31, 2007, but prior to the end of
the Restriction Period shall be entitled to receive a number of Shares equal to the
sum of (i) and (ii):

	 	(i)	 	the number of the Restricted Stock Units credited to the
Participant under Section 2(b) multiplied by a fraction, the numerator of which
is the Elapsed Months, and the denominator of which is 36, and
	 
	 	(ii)	 	the lesser of:

	 	(A)	 	the quotient of (i) the total amount deferred
in the Participant’s Deferral Election multiplied by a fraction, the
numerator of which is 36 minus the Elapsed Months, and the denominator
of which is 36, divided by (ii) the Fair Market Value of a Share on the
date the Participant ceases to be an employee, or
	 
	 	(B)	 	the number of Restricted Stock Units determined
under Section 2(b) multiplied by a fraction, the numerator of which is
36 minus the Elapsed Months, and the denominator of which is 36.

8. Termination of Employment for Any Other Reason.

	 	(a)	 	Before March 15, 2007.
	 
	 	 	 	A Participant whose employment terminates for any reason other than those described
in Sections 6 and 7 prior to March 15, 2007, shall be terminated from the Plan, and
his or her Deferral Election shall be cancelled.
	 
	 	(b)	 	After March 14, 2007 But Before January 1, 2008.
	 
	 	 	 	A Participant whose employment terminates for any reason other than those described
in Sections 6 and 7 after March 14, 2007, but prior to January 1, 2008, shall be
entitled to receive a number of Shares equal to:

	 	(i)	 	the lesser of:

	 	(A)	 	the amount of bonus deferred in the
Participant’s Deferral Election divided by the Fair Market Value of a
Share on the date the Participant ceases to be an employee, or
	 
	 	(B)	 	the number of Restricted Stock Units credited
to the Participant under Section 2(b).

4

 

	 	(c)	 	After December 31, 2007.
	 
	 	 	 	A Participant whose employment terminates for any reason other than those described
in Sections 6 and 7 after December 31, 2007, but prior to the end of the Restriction
Period shall be entitled to receive a number of Shares equal to the lesser of: the
total amount deferred in the Participant’s Deferral Election divided by the Fair
Market Value of a Share on the date the Participant ceases to be an employee; or
(ii) the number of Restricted Stock Units credited to the Participant under Section
2(b).

9. Election to Defer Beyond Restriction Period.

     The Participant may elect to defer delivery of any or all Shares due to him or her hereunder
to a date after the Restriction Period expires by properly filing with the Committee a timely
irrevocable deferral election. In his or her election to defer, the Participant may choose between
deferral to a particular calendar year, deferral until termination of employment, or deferral until
the year following his or her termination of employment, but in no event may the Participant defer
delivery of a Share more than ten years beyond the expiration of the Restriction Period under
Section 3. If a Participant terminates employment with the Company and all Affiliates for any
reason other than End of Service (i) after the Restriction Period expires and (ii) before the
calendar year specified in a deferral election, then he or she will be deemed to have elected to
defer delivery to the calendar year following his or her termination of employment. In addition,
if the Participant dies while employed with the Company or any Affiliate, any Shares remaining to
be paid in respect of this Agreement will be paid to his or her beneficiary designated under the
Plan as soon as practicable, regardless of any outstanding election to defer. Shares whose receipt
is deferred under this Section 9 will be delivered on or about March 15 of the year to which they
were deferred.

10. Assignment and Transfers.

     The rights and interests of the Participant hereunder may not be assigned, encumbered or
transferred except, in the event of the death of the Participant, by will or the laws of descent
and distribution.

11. Withholding Tax.

     The Company and any Affiliate shall have the right to retain Shares that are distributable to
the Participant hereunder to the extent necessary to satisfy any withholding taxes, whether
federal, state or local, triggered by the distribution of Shares under this Agreement.

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12. No Limitation on Rights of the Company.

     The grant hereunder shall 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.

13. Plan, Terms and Conditions, and Deferral Election Not a Contract of Employment.

     Neither the Plan, the Terms and Conditions, nor the Deferral Election is a contract of
employment, and no terms of employment of the Participant shall be affected in any way by the Plan,
the Terms and Conditions, the Deferral Election or related instruments, except as specifically
provided therein. Neither the establishment of the Plan, the Terms and Conditions, nor the
Deferral Election shall be construed as conferring any legal rights upon the Participant for a
continuation of employment, nor shall they interfere with the right of the Company or any Affiliate
to discharge the Participant and to treat the Participant without regard to the effect that such
treatment might have upon the Participant as a Participant.

14. Participant to Not Have Rights as a Stockholder.

     The Participant shall not have rights as a stockholder with respect to any Shares subject to
the Deferral Election prior to the date on which he or she is recorded as the holder of such Shares
on the records of the Company.

15. Notice.

     Any notice or other communication required or permitted hereunder shall be in writing and
shall be delivered personally, or sent by certified, registered or express mail, postage prepaid.
Any such notice shall 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,
Southfield, Michigan, 48034, Attention: General Counsel and, in the case of the Participant, to his
or her address set forth in the Deferral Election or, in each case, to such other address as may be
designated in a notice given in accordance with this Section.

16. Governing Law.

     This Agreement shall 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.

17. Plan Document Controls.

     Any term capitalized herein but not defined shall have the meaning set forth in the Lear
Corporation Long-Term Stock Incentive Plan (the “Plan”). Participants may obtain a copy of the
Plan document upon request. These Terms and Conditions are intended to generally summarize the
provisions of the MSPP. They do not alter the terms of the Plan document. The rights herein
granted are in all respects subject to the provisions set forth in the Plan to the same extent and
with the same effect as if set forth fully herein. In the event that the terms set forth herein
conflict with the terms of the Plan document, the Plan document shall control.

6exv10w40

 

Exhibit 10.40

LEAR CORPORATION

LONG-TERM STOCK INCENTIVE PLAN

2006 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) One-half of the Restricted Stock Units will vest on the second anniversary of the Grant
Date, and the remaining half will vest on the fourth anniversary of the Grant Date.
Notwithstanding anything contained herein to the contrary, the right of an Employee to receive
Shares underlying a Restricted Stock Unit will be forfeited if the Committee determines, in its
sole discretion, that (i) the Employee has entered into a business or employment relationship that
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.

          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, an Employee’s right to receive the Shares underlying his or her Restricted Stock Units 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 be entitled to receive the Shares underlying any Restricted Stock Units that have then vested.
In addition, the Employee will be entitled to receive the Shares underlying the number of
Restricted Stock Units, if any, that have not yet vested but would have vested under Section 2 if
the Employee’s End of Service Date had been 24 months following his actual End of Service Date.
The Employee will forfeit the right to receive Shares underlying any Restricted Stock Units that
have not yet vested or would not have vested in the next 24 months as described in the preceding
sentence. 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 Employee or the Employee’s beneficiary under
the Plan will be entitled to receive the Shares underlying all of the Restricted Stock Units,
including both those that have already vested and those that have not yet vested under Section 2
above.

          (c) Other Termination of Employment. If an Employee’s employment with the Company and
all Affiliates terminates due to any reason other than those provided in clauses 4(a) or (b), the
Employee or his or her estate (in the event of his or her death after termination) will forfeit the
right to receive Shares underlying any Restricted Stock Units that have not yet vested, but will be
entitled to receive Shares underlying any Restricted Stock Units that, at that time, will have
become vested.

          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 or at the later date elected by the Employee under Section
6. 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. Election to Defer. The Employee may elect to defer delivery of any or all Shares
due to him or her under the Award described in this document (and any balance in his Account under
clause 3(b)) to a date beyond their vesting date, by making a timely deferral

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election. In his or her election to defer, the Employee may choose between deferral to a
particular calendar year, or to the year following his or her termination of employment, but in no
event may the Employee defer delivery of a Share more than ten years beyond the date the Restricted
Stock Unit underlying it is due to vest under Section 2 above. If an Employee’s employment
terminates for any reason other than an End of Service Date before the calendar year specified in a
deferral election, he or she will be deemed to have elected to defer delivery to the calendar year
following his or her termination of employment. In addition, if the Employee dies while employed
with the Company or any Affiliate, any Shares remaining to be paid in respect of this Award will be
paid to his or her beneficiary designated under the Plan as soon as practicable, regardless of any
outstanding election to defer. Shares whose receipt is deferred under this Section 6 will be
delivered on or about March 15 of the year to which they were deferred. An election to defer will
be considered timely only if it is filed at least one year and one day in advance of the date the
Restricted Stock Units subject to the deferral will vest and the Employee remains employed by the
Company or an Affiliate for such period of a year and one day. Notwithstanding anything in this
Section 6 to the contrary, an election to defer hereunder shall comply with the requirements of
Section 409A of the Code or it will not be a valid election.

          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.

-4-

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