Tender-Offer Statement — Third-Party Tender Offer — Schedule TO
Filing Table of Contents
Document/Exhibit Description Pages Size
1: SC TO-T Tender-Offer Statement -- Third-Party Tender Offer 6 36K
2: EX-99.(A)(1)(A) Offer to Purchase 45 244K
3: EX-99.(A)(1)(B) Letter of Transmittal 12 59K
4: EX-99.(A)(1)(C) Notice of Guaranteed Delivery 2 14K
5: EX-99.(A)(1)(D) Letter to Brokers,Dealers 3 16K
6: EX-99.(A)(1)(E) Letter to Clients 3 17K
7: EX-99.(A)(1)(F) Guidelines for Certification of Taxpayer I.D. 5± 21K
No.
8: EX-99.(A)(5)(F) Summary Advertisement as Published May 5± 25K
17,2002
9: EX-99.(A)(5)(G) Press Release Issued by Sears on May 17,2002 1 8K
10: EX-99.(D)(1) Acquisition Agreement 55 228K
11: EX-99.(D)(2) Form of Tender Agreement,Dated May 12,2002 12 43K
12: EX-99.(D)(3) Confidentiality Agreement 8 34K
13: EX-99.(D)(4) Letter Agreement,Dated May 13,2002 2 14K
EX-99.(D)(4) — Letter Agreement,Dated May 13,2002
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Exhibit (d)(4)
SEARS, ROEBUCK AND CO.
3333 BEVERLY ROAD
HOFFMAN ESTATES, IL 60179
GREG A. LEE
Senior Vice President
Human Resources
847-286-0558
Fax 847-286-3258
Mr. David F. Dyer
Lands' End, Inc.
5 Lands' End Lane
Dodgeville, WI 53595
Dear Dave,
I wanted to provide you with this Letter of Understanding regarding some of the
major terms of your employment as an officer of Sears, Roebuck and Co. Pending
approval by the Boards of Directors of both Sears, Roebuck and Co. and Land's
End, Inc., the merger will result in employment terms as contained in your
Employment Agreement. Sears, Roebuck and Co. would like to supplement these
terms with the following provisions upon the close of the merger and your
assumption of duties as President and CEO - Lands' End and Executive Vice
President/ General Manager, Customer Direct - Sears, Roebuck and Co., reporting
directly to Alan Lacy, Chairman and Chief Executive Officer of Sears, Roebuck
and Co.
Your start date in this capacity is to be determined and will commence with
the close of the merger.
.. Base salary of $600,000 per year, paid on a semi-monthly basis.
.. Participation in the Sears Annual Incentive Plan. Your annual incentive
opportunity will be based on a bonus target equal to 85% of base salary,
amounting to $510,000 on an annualized basis. Depending on performance, you
can earn up to 230% of target, or $1,173,000. The annual incentive
performance objectives for your position are to be determined.
.. 50,000 non-qualified stock options that will vest in three equal annual
installments from the date of grant.
16,666 stock options will vest one year from the date of grant
- 16,666 stock options will vest two years from the date of grant
- 16,668 stock options will vest three years from the date of grant
.. 40,000 shares of restricted stock that will vest as follows
11,000 shares will vest two years from the date of grant
29,000 shares will vest three years from the date of grant
.. 29,000-share grant under the Long-Term Performance Incentive Program
(LTPIP). The LTPIP is designed to provide a common incentive for the most
senior leadership of Sears to achieve four financial goals by the end of
2004. If all four performance goals are deemed `met' by the Compensation
Committee of the Board of Directors and Sears Total Shareholder Return as
measured in comparison to the S&P 500 is in the top quartile, you will earn
3x the number of shares in the initial grant, or 87,000 shares. Earned
awards will be distributed in two installments:
50% distributed in your choice of cash or shares of Sears stock in
February 2005
50% distributed in February 2005 as restricted shares that vest in
December 2005
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.. Sears pension will commence at your employment date. A service enhancement
to your pension benefit will be provided for future service at Sears
through the non-qualified pension plan. The service enhancement will be
accrued to you as a 2-year for 1-year of service credit for five years from
the commencement of your employment with Sears, Roebuck and Co. If you
remain an active employee at the end of this five-year period, this
enhancement will be reviewed for possible extension.
.. Your current agreement with Lands' End contains non-compete,
non-disclosure, and non-solicitation provisions that will remain in place
during the term of your agreement. At the expiration of your current
agreement, it is anticipated that you will be asked to sign an Executive
Severance / Non-Compete Agreement and a Non-Solicitation / Non-Disclosure
Agreement with Sears on a basis that would mirror those of other similarly
situated executives at Sears. In the event of a Change in Control of Sears,
Roebuck and Co. during the term of your employment or if you are terminated
without cause after the expiration of your current agreement, the terms of
your separation would mirror those of other similarly situated executives
at Sears.
.. During any salary continuation period, stock options and restricted stock
will continue to vest in accordance with applicable plan documents and
individual grant letters. Should you be involuntarily terminated for a
reason other than for Cause, including for Good Reason, before the first
anniversary of your service with Sears, the following would occur:
- The 29,000 shares of restricted stock granted to you at the time of
your hire that would not otherwise vest would fully vest at the end of
your two-year severance period.
- You would receive a cash payment within 30 days of the end of the
two-year salary continuation period equivalent in value to the product
of the 16,668 options that would not otherwise vest during the salary
continuation period times the option `spread' (the positive difference
between the fair market value on the last day of the salary
continuation period and the exercise price of the option grant).
- Per the standard terms in the LTPIP grant, your participation would be
prorated through the last active day worked.
.. All of the above terms must be approved by the Compensation Committee of
the Sears Board of Directors. All equity grants are anticipated to be
granted as of the close of the merger agreement.
.. Finally, Sears has agreed to provide an additional one week of pay in
Christmas 2002 bonus checks for every Lands' End employee not included in a
retention plan related to the merger with Sears.
David, we are excited to be working in partnership with you to make the
successful merger of Lands' End and Sears a reality.
Sincerely,
Accepted /s/ David F. Dyer Date: May 13, 2002
Dates Referenced Herein and Documents Incorporated by Reference
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