-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FP46xmZTBrcoWGfAOj08iOwI6ZCs6pvvcL2LEbnB/5/dfkMEtKWQB5IQ57HpDyQo iC0kiCRzkz8PZxnOuxUmeA== 0000950150-01-500902.txt : 20020413 0000950150-01-500902.hdr.sgml : 20020413 ACCESSION NUMBER: 0000950150-01-500902 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20011220 EFFECTIVENESS DATE: 20011220 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LEARNINGSTAR CORP CENTRAL INDEX KEY: 0001130950 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-CATALOG & MAIL-ORDER HOUSES [5961] IRS NUMBER: 770559897 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-75602 FILM NUMBER: 1819932 BUSINESS ADDRESS: STREET 1: 2 LOWER RAGSDALE DRIVE STREET 2: SUITE 200 CITY: MONTEREY STATE: CA ZIP: 93940 BUSINESS PHONE: 8313332000 MAIL ADDRESS: STREET 1: 2 LOWER RAGSDALE DRIVE STREET 2: SUITE 200 CITY: MONTEREY STATE: CA ZIP: 93940 FORMER COMPANY: FORMER CONFORMED NAME: LEARNINGSTAR INC DATE OF NAME CHANGE: 20001229 S-8 1 a77943s-8.txt FORM S-8 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 20, 2001 Registration No. 333- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------- FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ---------- LEARNINGSTAR CORP. (Exact Name of Registrant as Specified in Its Charter) DELAWARE 77-0559897 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 2 LOWER RAGSDALE DRIVE MONTEREY, CALIFORNIA 93940 (Address of principal executive offices) (Zip Code) ---------- LEARNINGSTAR CORP. SECOND AMENDED AND RESTATED 2001 EMPLOYEE STOCK PURCHASE PLAN ---------- RONALD ELLIOTT CHIEF EXECUTIVE OFFICER LEARNINGSTAR CORP. 2 LOWER RAGSDALE DRIVE MONTEREY, CA 93940 (831) 333-2000 (Name, address, including zip code, and telephone number, including area code, of agent for service) COPY TO: JEFFREY L. KATEMAN, ESQ. LATHAM & WATKINS 633 WEST FIFTH STREET, SUITE 4000 LOS ANGELES, CALIFORNIA 90071 (213) 485-1234 ---------- CALCULATION OF REGISTRATION FEE
- ----------------------------------------------------------------------------------------------- PROPOSED AMOUNT PROPOSED MAXIMUM OF SHARES MAXIMUM AGGREGATE AMOUNT OF TITLE OF EACH CLASS OF TO BE OFFERING PRICE OFFERING REGISTRATION SECURITIES TO BE REGISTERED REGISTERED(1) PER SHARE(2) PRICE(2) FEE - ----------------------------------------------------------------------------------------------- Common Stock, $0.01 par value......... 125,000 $1.29 $161,250 $39 - -----------------------------------------------------------------------------------------------
(1) Represents 125,000 additional shares of common stock ("Common Stock") of LearningStar Corp., a Delaware corporation (the "Company") reserved for issuance under the Second Amended and Restated 2001 Employee Stock Purchase Plan (the "Plan"), by virtue of an amendment to the Plan that, among other things, increased the number of shares issuable under the Plan from 125,000 to 250,000. This registration statement shall also cover any additional shares of Common Stock which may become issuable under the Plan by reason of any stock split, stock dividend, recapitalization or other similar transaction effected without the receipt of consideration which results in an increase in the number of outstanding shares of Common Stock of the Company. Pursuant to Rule 416 under the Securities Act of 1933, as amended, this Registration Statement also covers an indeterminate number of shares of Common Stock which may be issued as a result of anti-dilution provisions contained in the Plan. (2) Estimated solely for purposes of computing the registration fee for the additional shares registered hereby pursuant to Rule 457(h)(1) of the Securities Act of 1933, as amended, based on the average of the high and low sales prices of the Company's Common Stock of $1.29 per share as reported on The Nasdaq SmallCap Market on December 17, 2001. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT INCORPORATION OF CONTENTS OF PRIOR REGISTRATION STATEMENT LearningStar Corp. (the "Registrant") files this Registration Statement pursuant to Instruction E of Form S-8 and incorporates by reference the contents of the previous Registration Statement filed by the Registrant on Form S-8 (Registration No. 333-64766). The current registration of 125,000 shares of Common Stock will increase the number of shares registered for issuance under the Registrant's Second Amended and Restated 2001 Employee Stock Purchase Plan to 250,000 shares. ITEM 8. EXHIBITS The following is a list of exhibits filed as part of this Registration Statement, which are incorporated herein: * 4.1 LearningStar Corp. Second Amended and Restated 2001 Employee Stock Purchase Plan *5.1 Opinion of Latham & Watkins *23.1 Consent of Latham & Watkins (included as part of Exhibit 5.1) *23.2 Consent of KPMG LLP *23.3 Consent of KPMG LLP *23.4 Consent of PricewaterhouseCoopers LLP *24 Power of Attorney (included on the signature pages of this registration statement)
* Filed herewith. 2 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Monterey, State of California, on this 20th day of December, 2001. LEARNINGSTAR CORP. By: /s/ Richard Delaney --------------------------------- Richard Delaney Chief Financial Officer POWER OF ATTORNEY Each person whose signature appears below constitutes and appoints Ronald Elliott and Richard Delaney, and each of them, with full power to act without the other, such person's true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign this Registration Statement, and any and all amendments thereto (including pre- and post-effective amendments) or any registration statement for the same offering that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act, and to file the same, with exhibits and schedules thereto, and other documents in connection therewith, with the Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing necessary or desirable to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act, this Registration Statement on Form S-8 has been signed below by the following persons in their capacities and on the dates indicated.
SIGNATURE TITLE DATE --------- ----- ---- /s/ Albert Noyes Chairman of the Board December 20, 2001 - ------------------------------------- Albert Noyes Director and Chief Executive December 20, 2001 /s/ Ronald Elliott Officer (Principal Executive - ------------------------------------- Officer) Ronald Elliott Director and Chief Financial December 20, 2001 /s/ Richard Delaney Officer (Principal Accounting - ------------------------------------- Officer) Richard Delaney /s/ Louis Casagrande Director December 20, 2001 - ------------------------------------- Louis Casagrande /s/ Dean DeBiase Director December 20, 2001 - ------------------------------------- Dean DeBiase /s/ Scott Graves Director December 20, 2001 - ------------------------------------- Scott Graves
S-1
SIGNATURE TITLE DATE --------- ----- ---- /s/ Michael Kolowich Director December 20, 2001 - ------------------------------------- Michael Kolowich /s/ Robert MacDonald Director December 20, 2001 - ------------------------------------- Robert MacDonald
INDEX TO EXHIBITS
EXHIBIT PAGE ------- ---- *4.1 LearningStar Corp. Second Amended and Restated 2001 Employee Stock Purchase Plan *5.1 Opinion of Latham & Watkins *23.1 Consent of Latham & Watkins (included as part of Exhibit 5.1) *23.2 Consent of KPMG LLP *23.3 Consent of KPMG LLP *23.4 Consent of PricewaterhouseCoopers LLP *24 Power of Attorney (included on the signature pages of this registration statement)
* Filed herewith. EX-4.1 3 a77943ex4-1.txt EXHIBIT 4.1 EXHIBIT 4.1 SECOND AMENDED AND RESTATED LEARNINGSTAR CORP. 2001 EMPLOYEE STOCK PURCHASE PLAN ARTICLE 1 - PURPOSE. This 2001 Employee Stock Purchase Plan (the "Plan") is intended to encourage stock ownership by all eligible employees of LearningStar Corp., a Delaware corporation, (the "Company"), and its participating subsidiaries (as defined in Article 17) so that they may share in the growth of the Company by acquiring or increasing their proprietary interest in the Company. The Plan is designed to encourage eligible employees to remain in the employ of the Company and its participating subsidiaries. The Plan is intended to constitute an "employee stock purchase plan" within the meaning of Section 423(b) of the Internal Revenue Code of 1986, as amended (the "Code"). ARTICLE 2 - ADMINISTRATION OF THE PLAN. The Plan may be administered by a committee appointed by the Board of Directors of the Company (the "Committee"). The Committee shall consist of not less than two members of the Company's Board of Directors. The Board of Directors may from time to time remove members from, or add members to, the Committee. Vacancies on the Committee, howsoever caused, shall be filled by the Board of Directors. The Committee may select one of its members as Chairman, and shall hold meetings at such times and places as it may determine. Acts by a majority of the Committee, or acts reduced to or approved in writing by a majority of the members of the Committee, shall be the valid acts of the Committee. The interpretation and construction by the Committee of any provisions of the Plan or of any option granted under it shall be final, unless otherwise determined by the Board of Directors. The Committee may from time to time adopt such rules and regulations for carrying out the Plan as it may deem best, provided that any such rules and regulations shall be applied on a uniform basis to all employees under the Plan. No member of the Board of Directors or the Committee shall be liable for any action or determination made in good faith with respect to the Plan or any option granted under it. In the event the Board of Directors fails to appoint or refrains from appointing a Committee, the Board of Directors shall have all power and authority to administer the Plan. In such event, the word "Committee" wherever used herein shall be deemed to mean the Board of Directors. ARTICLE 3 - ELIGIBLE EMPLOYEES. All employees of the Company or any of its participating subsidiaries whose customary employment with the Company is more than 20 hours per week and for more than five months in any calendar year and who have completed at least one (1) day of employment, shall be eligible to receive options under the Plan to purchase common stock of the Company, and all eligible employees shall have the same rights and privileges hereunder. Persons who are eligible employees on the first business day of any Payment Period (as defined in Article 5) shall receive their options as of such day. Persons who become eligible employees after any date on which options are granted under the Plan shall be granted options on the first day of the next succeeding Payment Period on which options are granted to eligible employees under the Plan. In no event, however, may an employee be granted an option if such employee, immediately after the option was granted, would be treated as owning stock possessing five percent or more of the total combined voting power or value of all classes of stock of the Company or of any parent corporation or subsidiary corporation, as the terms "parent corporation" and "subsidiary corporation" are defined in Section 424(e) and (f) of the Code. For purposes of determining stock ownership under this paragraph, the rules of Section 424(d) of the Code shall apply, and stock which the employee may purchase under outstanding options shall be treated as stock owned by the employee. ARTICLE 4 - STOCK SUBJECT TO THE PLAN. The stock subject to the options under the Plan shall be shares of the Company's authorized but unissued common stock, par value $.01 per share (the "Common Stock"), or shares of Common Stock reacquired by the Company, including shares purchased in the open market. The aggregate number of shares which may be issued pursuant to the Plan is 250,000, subject to adjustment as provided in Article 12. If any option granted under the Plan shall expire or terminate for any reason without having been exercised in full or shall cease for any reason to be exercisable in whole or in part, the unpurchased shares subject thereto shall again be available under the Plan. ARTICLE 5 - PAYMENT PERIOD AND STOCK OPTIONS. Payment Periods shall consist of the six-month periods commencing on March 1 and September 1 and ending on August 31 and February 28 of each calendar year. On the first business day of each Payment Period, the Company will grant to each eligible employee who is then a participant in the Plan an option to purchase on the last day of such Payment Period, at the Option Price hereinafter provided for, a maximum of 200 shares, on condition that such employee remains eligible to participate in the Plan throughout the remainder of such Payment Period. The participant shall be entitled to exercise the option so granted only to the extent of the participant's accumulated payroll deductions on the last day of such Payment Period. If the participant's accumulated payroll deductions on the last day of the Payment Period would enable the participant to purchase more than 200 shares except for the 200-share limitation, the excess of the amount of the accumulated payroll deductions over the aggregate purchase price of the 200 shares shall be promptly refunded to the participant by the Company, without interest. The Option Price per share for each Payment Period shall be the lesser of (i) 85% of the average market price of the Common Stock on the first business day of the Payment Period and (ii) 85% of the average market price of the Common Stock on the last business day of the Payment Period, in either event rounded up to the nearest cent. The foregoing limitation on the number of shares subject to option and the Option Price shall be subject to adjustment as provided in Article 12. For purposes of the Plan, the term "average market price" on any date means (i) the average (on that date) of the high and low prices of the Common Stock on the principal national securities exchange on which the Common Stock is traded, if the Common Stock is then traded on a national securities exchange; or (ii) the last reported sale price (on that date) of the Common Stock on the Nasdaq Stock Market, if the Common Stock is not then traded on a national securities exchange; or (iii) the average of the closing bid and asked prices last quoted (on that date) by an established quotation service for over-the-counter securities, if the Common Stock is not reported on the Nasdaq Stock Market; or (iv) if the Common Stock is not publicly traded, the fair market value of the Common Stock as determined by the Committee after taking into consideration all factors which it deems appropriate, including, without limitation, recent sale and offer prices of the Common Stock in private transactions negotiated at arm's length. 2 For purposes of the Plan, the term "business day" means a day on which there is trading on the Nasdaq Stock Market or the aforementioned national securities exchange, whichever is applicable pursuant to the preceding paragraph; and if neither is applicable, a day that is not a Saturday, Sunday or legal holiday in the State of Delaware. No employee shall be granted an option which permits the employee's right to purchase stock under the Plan, and under all other Section 423(b) employee stock purchase plans of the Company and any parent or subsidiary corporations, to accrue at a rate which exceeds $25,000 of fair market value of such stock (determined on the date or dates that options on such stock were granted) for each calendar year in which such option is outstanding at any time. The purpose of the limitation in the preceding sentence is to comply with Section 423(b)(8) of the Code. If the participant's accumulated payroll deductions on the last day of the Payment Period would otherwise enable the participant to purchase Common Stock in excess of the Section 423(b)(8) limitation described in this paragraph, the excess of the amount of the accumulated payroll deductions over the aggregate purchase price of the shares actually purchased shall be promptly refunded to the participant by the Company, without interest. ARTICLE 6 - EXERCISE OF OPTION. Each eligible employee who continues to be a participant in the Plan on the last day of a Payment Period shall be deemed to have exercised his or her option on such date and shall be deemed to have purchased from the Company such number of full shares of Common Stock reserved for the purpose of the Plan as the participant's accumulated payroll deductions on such date will pay for at the Option Price, subject to the 200-share limit of the option and the Section 423(b)(8) limitation described in Article 5. If the individual is not a participant on the last day of a Payment Period, then he or she shall not be entitled to exercise his or her option. Only full shares of Common Stock may be purchased under the Plan. Unused payroll deductions remaining in a participant's account at the end of a Payment Period by reason of the inability to purchase a fractional share shall be carried forward to the next Payment Period. ARTICLE 7 - AUTHORIZATION FOR ENTERING THE PLAN. An employee may elect to enter the Plan by filling out, signing and delivering to the Company an authorization: A. Stating the dollar amount to be deducted regularly from the employee's pay; B. Authorizing the purchase of stock for the employee in each Payment Period in accordance with the terms of the Plan; and C. Specifying the exact name or names in which stock purchased for the employee is to be issued as provided under Article 11 hereof. Such authorization must be received by the Company at least ten days before the first day of the next succeeding Payment Period and shall take effect only if the employee is an eligible employee on the first business day of such Payment Period. Unless a participant files a new authorization or withdraws from the Plan, the deductions and purchases under the authorization the participant has on file under the Plan will continue from one Payment Period to succeeding Payment Periods as long as the Plan remains in effect. 3 The Company will accumulate and hold for each participant's account the amounts deducted from his or her pay. No interest will be paid on these amounts. ARTICLE 8 - MAXIMUM AMOUNT OF PAYROLL DEDUCTIONS. An employee may elect payroll deductions in an amount equal to not less than $200 and not more than $5,000 per annum; provided that the annual amounts elected by the employee must be made in $50 increments. ARTICLE 9 - CHANGE IN PAYROLL DEDUCTIONS. Deductions may not be increased or decreased during a Payment Period. However, a participant may withdraw in full from the Plan. ARTICLE 10 - WITHDRAWAL FROM THE PLAN. A participant may withdraw from the Plan (in whole but not in part) at any time prior to the last day of a Payment Period by delivering a withdrawal notice to the Company. To re-enter the Plan, an employee who has previously withdrawn must file a new authorization at least ten days before the first day of the next Payment Period in which he or she wishes to participate. The employee's re-entry into the Plan becomes effective at the beginning of such Payment Period, provided that he or she is an eligible employee on the first business day of the Payment Period. ARTICLE 11 - ISSUANCE OF STOCK. Certificates for stock issued to participants shall be delivered as soon as practicable after each Payment Period by the Company's transfer agent. Stock purchased under the Plan shall be issued only in the name of the participant, or if the participant's authorization so specifies, in the name of the participant and another person of legal age as joint tenants with rights of survivorship. ARTICLE 12 - ADJUSTMENTS. Upon the happening of any of the following described events, a participant's rights under options granted under the Plan shall be adjusted as hereinafter provided: A. In the event that the shares of Common Stock shall be subdivided or combined into a greater or smaller number of shares or if, upon a reorganization, split-up, liquidation, recapitalization or the like of the Company, the shares of Common Stock shall be exchanged for other securities of the Company, each participant shall be entitled, subject to the conditions herein stated, to purchase such number of shares of Common Stock or amount of other securities of the Company as were exchangeable for the number of shares of Common Stock that such participant would have been entitled to purchase except for such action, and appropriate adjustments shall be made in the purchase price per share to reflect such subdivision, combination or exchange; and B. In the event the Company shall issue any of its shares as a stock dividend upon or with respect to the shares of stock of the class which shall at the time be subject to option hereunder, each participant upon exercising such an option shall be entitled to receive (for the purchase price paid upon such exercise) the shares as to which the participant is exercising his or her option and, in 4 addition thereto (at no additional cost), such number of shares of the class or classes in which such stock dividend or dividends were declared or paid, and such amount of cash in lieu of fractional shares, as is equal to the number of shares thereof and the amount of cash in lieu of fractional shares, respectively, which the participant would have received if the participant had been the holder of the shares as to which the participant is exercising his or her option at all times between the date of the granting of such option and the date of its exercise. Upon the happening of any of the foregoing events, the class and aggregate number of shares set forth in Article 4 hereof which are subject to options which have been or may be granted under the Plan and the limitations set forth in the second paragraph of Article 5 shall also be appropriately adjusted to reflect the events specified in paragraphs A and B above. Notwithstanding the foregoing, any adjustments made pursuant to paragraphs A or B shall be made only after the Committee, based on advice of counsel for the Company, determines whether such adjustments would constitute a "modification" (as that term is defined in Section 424 of the Code). If the Committee determines that such adjustments would constitute a modification, it may refrain from making such adjustments. If the Company is to be consolidated with or acquired by another entity in a merger, a sale of all or substantially all of the Company's assets or otherwise (an "Acquisition"), the Committee or the board of directors of any entity assuming the obligations of the Company hereunder (the "Successor Board") shall, with respect to options then outstanding under the Plan, either (i) make appropriate provision for the continuation of such options by arranging for the substitution on an equitable basis for the shares then subject to such options either (a) the consideration payable with respect to the outstanding shares of the Common Stock in connection with the Acquisition, (b) shares of stock of the successor corporation, or a parent or subsidiary of such corporation, or (c) such other securities as the Successor Board deems appropriate, the fair market value of which shall not materially exceed the fair market value of the shares of Common Stock subject to such options immediately preceding the Acquisition; or (ii) terminate each participant's options in exchange for a cash payment equal to the excess of (a) the fair market value on the date of the Acquisition, of the number of shares of Common Stock that the participant's accumulated payroll deductions as of the date of the Acquisition could purchase, at an option price determined with reference only to the first business day of the applicable Payment Period and subject to the 200-share limit, Code Section 423(b)(8) and fractional-share limitations on the amount of stock a participant would be entitled to purchase, over (b) the result of multiplying such number of shares by such option price. The Committee or Successor Board shall determine the adjustments to be made under this Article 12, and its determination shall be conclusive. ARTICLE 13 - NO TRANSFER OR ASSIGNMENT OF EMPLOYEE'S RIGHTS. An option granted under the Plan may not be transferred or assigned and may be exercised only by the participant. ARTICLE 14 - TERMINATION OF EMPLOYEE'S RIGHTS. Whenever a participant ceases to be an eligible employee because of retirement, voluntary or involuntary termination, resignation, layoff, discharge, death or for any other reason, his or her rights under the Plan shall immediately terminate, and the Company shall promptly refund, without interest, the entire balance of his or her payroll deduction account under the Plan. Notwithstanding the foregoing, eligible employment shall be treated as continuing intact while a participant is on military leave, sick leave or other bona fide leave of absence, for up to 90 days, or for so long as the participant's right to re-employment is guaranteed either by statute or by contract, if longer than 90 days. 5 If a participant's payroll deductions are interrupted by any legal process, a withdrawal notice will be considered as having been received from the participant on the day the interruption occurs. ARTICLE 15 - TERMINATION AND AMENDMENTS TO PLAN. Unless terminated sooner as provided below, the Plan shall terminate on April 30, 2011. The Plan may be terminated at any time by the Company's Board of Directors but such termination shall not affect options then outstanding under the Plan. It will terminate in any case when all or substantially all of the unissued shares of stock reserved for the purposes of the Plan have been purchased. If at any time shares of stock reserved for the purpose of the Plan remain available for purchase but not in sufficient number to satisfy all then unfilled purchase requirements, the available shares shall be apportioned among participants in proportion to the amount of payroll deductions accumulated on behalf of each participant that would otherwise be used to purchase stock, and the Plan shall terminate. Upon such termination or any other termination of the Plan, all payroll deductions not used to purchase stock will be refunded, without interest. The Committee or the Company's Board of Directors may at any time wholly or partially amend, alter or suspend the Plan. However, without approval of the Company's shareholders given within twelve (12) months before or after the action by the Board, no action of the Committee or the Company's Board of Directors may, except as provided in paragraph 12, increase the limits imposed in paragraph 4 on the maximum number of shares which may be issued under the Plan or extend the term of the Plan under paragraph 15. The Company's Board of Directors shall obtain shareholder approval of any Plan amendment to the extent necessary and desirable to comply with applicable tax laws. No amendment, alteration, suspension or termination of the Plan shall impair the rights of any participant, unless mutually agreed otherwise between the participant and the Company, which agreement must be in writing and signed by the participant and the Company. Termination of the Plan shall not affect the Committee's ability to exercise the powers granted to it hereunder with respect to options granted or awarded under the Plan prior to the date of such termination. ARTICLE 16 - LIMITS ON SALE OF STOCK PURCHASED UNDER THE PLAN. The Plan is intended to provide shares of Common Stock for investment and not for resale. The Company does not, however, intend to restrict or influence any employee in the conduct of his or her own affairs. An employee may, therefore, sell stock purchased under the Plan at any time the employee chooses, subject to compliance with any applicable federal or state securities laws and subject to any restrictions imposed under Article 21 to ensure that tax withholding obligations are satisfied. THE EMPLOYEE ASSUMES THE RISK OF ANY MARKET FLUCTUATIONS IN THE PRICE OF THE STOCK. ARTICLE 17 - PARTICIPATING SUBSIDIARIES. The term "participating subsidiary" shall mean any present or future subsidiary of the Company, as that term is defined in Section 424(f) of the Code, which is designated from time to time by the Board of Directors to participate in the Plan. The Board of Directors shall have the power to make such designation before or after the Plan is approved by the stockholders. 6 ARTICLE 18 - OPTIONEES NOT STOCKHOLDERS. Neither the granting of an option to an employee nor the deductions from his or her pay shall constitute such employee as a stockholder of the shares covered by an option until such shares have been actually purchased by the employee. ARTICLE 19 - APPLICATION OF FUNDS. The proceeds received by the Company from the sale of Common Stock pursuant to options granted under the Plan will be used for general corporate purposes. ARTICLE 20 - NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION. By electing to participate in the Plan, each participant agrees to notify the Company in writing immediately after the participant transfers Common Stock acquired under the Plan, if such transfer occurs within two years after the first business day of the Payment Period in which such Common Stock was acquired. Each participant further agrees to provide any information about such a transfer as may be requested by the Company or any subsidiary corporation in order to assist it in complying with the tax laws. Such dispositions generally are treated as "disqualifying dispositions" under Sections 421 and 424 of the Code, which have certain tax consequences to participants and to the Company and its participating subsidiaries. ARTICLE 21 - WITHHOLDING OF ADDITIONAL INCOME TAXES. By electing to participate in the Plan, each participant acknowledges that the Company and its participating subsidiaries are required to withhold taxes with respect to the amounts deducted from the participant's compensation and accumulated for the benefit of the participant under the Plan, and each participant agrees that the Company and its participating subsidiaries may deduct additional amounts from the participant's compensation, when amounts are added to the participant's account, used to purchase Common Stock or refunded, in order to satisfy such withholding obligations. Each participant further acknowledges that when Common Stock is purchased under the Plan the Company and its participating subsidiaries may be required to withhold taxes with respect to all or a portion of the difference between the fair market value of the Common Stock purchased and its purchase price, and each participant agrees that such taxes may be withheld from compensation otherwise payable to such participant. It is intended that tax withholding will be accomplished in such a manner that the full amount of payroll deductions elected by the participant under Article 7 will be used to purchase Common Stock. However, if amounts sufficient to satisfy applicable tax withholding obligations have not been withheld from compensation otherwise payable to any participant, then, notwithstanding any other provision of the Plan, the Company may withhold such taxes from the participant's accumulated payroll deductions and apply the net amount to the purchase of Common Stock, unless the participant pays to the Company, prior to the exercise date, an amount sufficient to satisfy such withholding obligations. Each participant further acknowledges that the Company and its participating subsidiaries may be required to withhold taxes in connection with the disposition of stock acquired under the Plan and agrees that the Company or any participating subsidiary may take whatever action it considers appropriate to satisfy such withholding requirements, including deducting from compensation otherwise payable to such participant an amount sufficient to satisfy such withholding requirements or conditioning any disposition of Common Stock by the participant upon the payment to the Company or such subsidiary of an amount sufficient to satisfy such withholding requirements. Notwithstanding any other provision of the Plan, the number of shares of Common Stock which may be withheld upon the exercise or vesting of any right under the Plan, or which may be repurchased from the Participant within six months after such shares were acquired by the participant from the Company, in order to satisfy the participant's federal and state income and payroll 7 tax liabilities with respect to the exercise or vesting of the right shall be limited to the number of shares which have a fair market value equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for federal and state income tax income and payroll tax purposes that are applicable to such supplemental taxable income. ARTICLE 22 - GOVERNMENTAL REGULATIONS. The Company's obligation to sell and deliver shares of Common Stock under the Plan is subject to the approval of any governmental authority required in connection with the authorization, issuance or sale of such shares. Government regulations may impose reporting or other obligations on the Company with respect to the Plan. For example, the Company may be required to identify shares of Common Stock issued under the Plan on its stock ownership records and send tax information statements to employees and former employees who transfer title to such shares. ARTICLE 23 - GOVERNING LAW. The validity and construction of the Plan shall be governed by the laws of Delaware, without giving effect to the principles of conflicts of law thereof. 8 EX-5.1 4 a77943ex5-1.txt EXHIBIT 5.1 EXHIBIT 5.1 [LETTERHEAD OF LATHAM & WATKINS] December 20, 2001 LearningStar Corp. 2 Lower Ragsdale Drive Monterey, California 93940 Re: LearningStar Corp. 125,000 shares of common stock, par value $0.01 per share Ladies and Gentlemen: In connection with the registration under the Securities Act of 1933, as amended (the "Act"), of an additional 125,000 shares (the "Shares") of common stock, par value $0.01 per share, of LearningStar Corp. (the "Company") issuable under the Company's Second Amended and Restated 2001 Employee Stock Purchase Plan (the "Plan"), by the Company on a Registration Statement on Form S-8 filed with the Securities and Exchange Commission (the "Commission") on December 20, 2001 (the "Registration Statement"), you have requested our opinion with respect to the matters set forth below. In our capacity as your special counsel in connection with such registration, we are familiar with the proceedings taken and proposed to be taken by the Company in connection with the authorization, issuance and sale of the Shares. In addition, we have made such legal and factual examinations and inquiries, including an examination of originals or copies certified or otherwise identified to our satisfaction of such documents, corporate records and instruments, as we have deemed necessary or appropriate for purposes of this opinion. In our examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, and the conformity to authentic original documents of all documents submitted to us as copies. We are opining herein as to the effect on the subject transaction only of the General Corporation Law of the State of Delaware, and we express no opinion with respect to the applicability thereto, or the effect thereon, of any other laws. Subject to the foregoing, it is our opinion that the Shares to be issued under the Plan have been duly authorized, and upon the issuance and delivery of the Shares in the manner contemplated by the Plan, and assuming the Company completes all actions and proceedings required on its part to be taken prior to the issuance and delivery of the Shares pursuant to the terms of the Plan, including, without limitation, collection of required payment for the Shares, the Shares will be validly issued, fully paid and nonassessable. This opinion is rendered only to you and is solely for your benefit in connection with the transactions covered hereby. This opinion may not be relied upon by you for any other purpose, or furnished to, quoted to or relied upon by any other person, firm or corporation for any purpose, without our prior written consent. We consent to your filing this opinion as an exhibit to the registration statement. Very truly yours, /S/ Latham & Watkins EX-23.2 5 a77943ex23-2.txt EXHIBIT 23.2 Exhibit 23.2 CONSENT OF KPMG LLP Management Committee Earlychildhood LLC We consent to incorporation by reference in this registration statement on Form S-8 of LearningStar Corp. Second Amended and Restated 2001 Employee Stock Purchase Plan of our reports dated February 16, 2001, except for Notes 2(o) and 22 which are as of March 14, 2001, with respect to the consolidated balance sheets of Earlychildhood LLC and subsidiary as of December 31, 1999 and 2000, and the related statements of operations, members' equity and cash flows for the nine months ended December 31, 1998 and each of the years ended December 31, 1999 and 2000, which reports appear in the Post-effective Amendment no. 1 to the Form S-4 registration statement of LearningStar Corp. dated March 15, 2001. /s/ KPMG LLP San Francisco, California December 20, 2001 4 EX-23.3 6 a77943ex23-3.txt EXHIBIT 23.3 Exhibit 23.3 CONSENT OF KPMG LLP The Board of Directors Educational Products, Inc. We consent to incorporation by reference in this registration statement on Form S-8 of LearningStar Corp. Second Amended and Restated 2001 Employee Stock Purchase Plan of our reports dated December 3, 1999, with respect to the balance sheets of Educational Products, Inc. as of March 31, 1999 and May 5, 1999, and the related statements of operations, stockholders' equity and cash flows for the year ended March 31, 1999 and the 35-day period ended May 5, 1999, which reports appear in the Post-effective Amendment no. 1 to the Form S-4 registration statement of LearningStar Corp. dated March 15, 2001. /s/ KPMG LLP San Francisco, California December 20, 2001 EX-23.4 7 a77943ex23-4.txt EXHIBIT 23.4 Exhibit 23.4 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in this Registration Statement on Form S-8 of LearningStar Corp. of our report dated February 2, 2001, relating to the financial statements of SmarterKids.com, Inc., which appears in the Registration Statement on Form S-4 (No. 333-53454). /s/ PricewaterhouseCoopers LLP Boston, Massachusetts December 20, 2001 -----END PRIVACY-ENHANCED MESSAGE-----