-----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, K4QF05GccKOUe0MGZudMxZUJp9b1KGPXgG/9GoUWO/8MHnz5Ms1RCNJTJj00upID hNhlbQPqYLwesEmYpsl62g== /in/edgar/work/20000901/0000912057-00-039963/0000912057-00-039963.txt : 20000922 0000912057-00-039963.hdr.sgml : 20000922 ACCESSION NUMBER: 0000912057-00-039963 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 20000901 EFFECTIVENESS DATE: 20000901 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PEARSON PLC CENTRAL INDEX KEY: 0000938323 STANDARD INDUSTRIAL CLASSIFICATION: [0000 ] IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-45070 FILM NUMBER: 715775 BUSINESS ADDRESS: STREET 1: 3 BURLINGTON GARDENS STREET 2: BANK OF NEW YORK CITY: LONDON UK W1X 1LE STATE: X0 ZIP: 00000 BUSINESS PHONE: 4420744120 MAIL ADDRESS: STREET 1: 3 BURLINGTON GARDENS CITY: LONDON UK W1X 1LE STATE: X0 ZIP: 00000 S-8 1 s-8.txt FORM S-8 As filed with the Securities and Exchange Commission on September 1, 2000 REGISTRATION NO. 333-_____ - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------- FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------- PEARSON PLC (Exact name of Registrant as specified in its charter) ENGLAND AND WALES NOT REQUIRED (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) ------------- 3 BURLINGTON GARDENS LONDON, ENGLAND W1X 1LE 44-20-7411-2000 (Address, including zip code, of Principal Executive Offices) -------------- THE FAMILY EDUCATION COMPANY AMENDED AND RESTATED 1990 STOCK OPTION PLAN THE FAMILY EDUCATION NETWORK, INC. 2000 STOCK OPTION AND INCENTIVE PLAN PEARSON PLC WORLDWIDE SAVE FOR SHARES PLAN (Full Title of the Plan) ----------- PEARSON INC. 1330 AVENUE OF THE AMERICAS NEW YORK, NEW YORK 10019 (212) 641-2400 (Name, address, and telephone number, including area code, of agent for service) ---------- COPY TO: CHARLES E. ENGROS MORGAN, LEWIS & BOCKIUS LLP 101 PARK AVENUE NEW YORK, NEW YORK 10178 (212) 309-6000 FAX: (212) 309-6273 - ------------------------------------------------------------------------------- CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------------------------------------------- PROPOSED PROPOSED MAXIMUM MAXIMUM TITLE OF SECURITIES TO AMOUNT TO BE OFFERING AGGREGATE AMOUNT OF BE REGISTERED REGISTERED(1) PRICE PER SHARE OFFERING REGISTRATION PRICE FEE (8) - -------------------------------------------------------------------------------------------------------------------- Company's Ordinary Shares, 25p per share 512,921(2) $ 6.26(5) $ 3,210,885.46 $ 847.68 19,589(3) $ 6.81(6) $ 133,401.09 $ 35.22 1,000,000(4) $27.23(7) $27,230,000.00 $7,188.72 TOTAL 1,532,510 $8,071.62 ========= =========
(1) American Depositary Shares which may be issued with respect to Ordinary Shares will be registered under a separate Registration Statement on Form F-6. (2) The Ordinary Shares of 25p each being registered were granted to certain United States employees who were participants in The Family Education Company Amended and Restated 1990 Stock Option Plan and The Family Education Network, Inc. 2000 Stock Option Plan (collectively, the "Plans"). The Plans were assumed by Pearson Inc. pursuant to an Agreement and Plan of Merger among Pearson Inc., Quill Acquisition Corp. and The Family Education Network, Inc., dated June 28, 2000 (the "Merger Agreement"). Pursuant to the Merger Agreement, all outstanding stock options under the Plans will be converted to stock options for Pearson plc Ordinary Shares. In addition to the Ordinary Shares indicated above, pursuant to Rule 416(a) under the Securities Act of 1933, as amended, (the "Securities Act") this Registration Statement also covers an indeterminate number of Ordinary Shares which may become issuable as a result of stock splits, stock dividends, or similar transactions in accordance with the anti-dilution provisions of the Plans. (3) The Ordinary Shares of 25p each being registered hereby will be granted by Pearson plc to certain United States employees under The Family Education Network, Inc. 2000 Stock Option Plan, if certain objectives are met. (4) The Ordinary Shares of 25p each being registered hereby will be granted by Pearson plc to certain United States employees who are participants in the Pearson plc Worldwide Save for Shares Plan. (5) The average weighted exercise price of outstanding Ordinary Shares pursuant to Rule 457(h)(1). (6) The maximum offering price per share used to calculate the registration fee was estimated by determining 25% of the fair market value of Pearson plc Ordinary Shares based on the closing price of the Ordinary Shares on the London Stock Exchange on August 30,2000, pursuant to certain agreements with certain United States employees; this calculation was based upon an exchange rate of L1.00 = $1.456, the noon buying rate on August 30, 2000. (7) The maximum offering price per share used to calculate the registration fee was estimated pursuant to Rule 457, based upon an exchange rate of L1.00 = $1.456, the noon buying rate on August 30, 2000. (8) Calculated pursuant to Section 6(b) of the Securities Act as follows: proposed maximum aggregate offering price multiplied by .000264. PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS Item 1. PLAN INFORMATION.* Item 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.* * Information required by Part I to be contained in the Section 10(a) prospectus is omitted from this Registration Statement in accordance with Rule 428 under the Securities Act and the Explanatory Note to Part I of this Registration Statement on Form S-8. I-1 PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE. The following documents filed by us with the Securities and Exchange Commission (the "SEC") are incorporated by reference into this Registration Statement: (a) The description of our Ordinary Shares, par value 25p, and our American Depository Shares contained in our Registration Statement on Form F-1 (Registration No. 333-43198), including any amendment or report filed for the purpose of updating such description. (b) All other reports filed by us with the SEC pursuant to Section 13(a) or 15(d) of the Exchange Act since the end of our fiscal year ended December 31, 1999. All reports and other documents subsequently filed by us pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold shall be deemed to be incorporated by reference in this Registration Statement and to be a part hereof from the date of filing of such documents. Any statement contained herein or in a document all or a portion of which is incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Registration Statement to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement. Item 4. DESCRIPTION OF SECURITIES. Not Applicable. Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL. Not Applicable. Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Subject to applicable English law, our directors and officers will be indemnified by us and/or exempted by us from all costs, charges, losses and liabilities incurred by them in the actual or purported exercise or discharge of their powers or duties. This indemnity and exemption includes any liability incurred by them in defending any civil or criminal proceedings which relate to anything done or alleged to have been done by them as our officer or employee and in which judgment is given in their favor; or where proceedings are disposed of without any finding or admission of any material breach of duty on their part; or in which they are acquitted or in respect of which relief from liability is granted. II-1 Our directors have the power to purchase and maintain insurance for, or for the benefit of, any persons that are or were at any time a director or officer of us or any company we control or that is part of our group (a "Relevant Company") or that are or were trustees of any pension fund or employees' share scheme in which employees of any Relevant Company are interested. Such insurance may include insurance against any liability incurred by them in respect of any act or omission in the actual or purported exercise or discharge of their powers or duties in relation to any Relevant Company, or such pension fund or employees' share scheme. Item 7. EXEMPTION FROM REGISTRATION CLAIMED. Not Applicable. Item 8. EXHIBITS.
EXHIBIT DESCRIPTION 4.1 Memorandum and Articles of Association of Pearson (incorporated by reference from Exhibits 3.1 and 3.2 to Pearson's Registration Statement on Form F-1 (No. 333-43198)) 4.2 Specimen certificate for ordinary shares of Pearson plc, 25 par value (incorporated by reference from Exhibit 4.1 to Pearson's Registration Statement on Form F-1 (No. 333-43198)) 4.3 Form of Amended Deposit Agreement between Pearson plc and The Bank of New York and Form of ADR (incorporated by reference from Exhibit 4.2 to Pearson's Registration Statement on Form F-1 (No. 333-43198)) 4.4 The Family Education Company Amended and Restated 1990 Stock Option Plan 4.5 The Family Education Network, Inc. 2000 Stock Option and Incentive Plan 4.6 Pearson plc Worldwide Save for Shares Plan 5 Opinion of Freshfields Bruckhaus Deringer 23.1 Consent of PricewaterhouseCoopers 23.2 Consent of PricewaterhouseCoopers LLP 23.3 Consent of Freshfields Bruckhaus Deringer (included in Exhibit 5) 24 Powers of Attorney (included on signature page hereof)
Item 9. UNDERTAKINGS. (a) The undersigned registrant hereby undertakes: II-2 (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act; (ii) To reflect in the Prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement; PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in this Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, 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 London, on the 1st day of September, 2000. Pearson plc By: /s/ John Makinson ------------------------------- John Makinson By: /s/ Stevenson ------------------------------- Lord Stevenson Each person whose signature appears below constitutes and appoints Marjorie Scardino, John Makinson and Peter Gill 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 any and all amendments (including post-effective amendments) to this Registration Statement and any and all other documents and instruments incidental thereto, and to file the same, with all exhibits thereto, and all documents in connection therewith, with the Securities and Exchange Commission and any other regulatory authority, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done, 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 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 of 1933, this Registration Statement has been signed below by the following individuals in the capacities and on the date or dates indicated.
SIGNATURE TITLE DATE /s/ Stevenson Chairman September 1, 2000 - ---------------------------------- Lord Stevenson /s/ Marjorie Scardino Chief Executive Officer and September 1, 2000 - ---------------------------------- Director (principal executive Marjorie Scardino officer)
II-4
SIGNATURE TITLE DATE /s/ John Makinson Finance Director (principal September 1, 2000 - ---------------------------------- John Makinson financial officer) /s/ Peter Gill Director, Financial Operations September 1, 2000 - ---------------------------------- Peter Gill (principal accounting officer) /s/ David Bell Director September 1, 2000 - ---------------------------------- David Bell /s/ Burns Director September 1, 2000 - ---------------------------------- Lord Burns /s/ Gillian Lewis Director September 1, 2000 - ---------------------------------- Gillian Lewis /s/ Reuben Mark Director September 1, 2000 - ---------------------------------- Reuben Mark /s/ Vernon Sankey Director September 1, 2000 - ---------------------------------- Vernon Sankey /s/ Rana Talwar Director September 1, 2000 - ---------------------------------- Rana Talwar U.S. AUTHORIZED REPRESENTATIVE PEARSON INC. By: /s/ Philip Hoffman - ---------------------------------- Name: Philip Hoffman Title: President
II-5 EXHIBIT INDEX
EXHIBIT DESCRIPTION 4.1 Memorandum and Articles of Association of Pearson (incorporated by reference from Exhibits 3.1 and 3.2 to Pearson's Registration Statement on Form F-1 (No. 333-43198)) 4.2 Specimen certificate for ordinary shares of Pearson plc, 25 par value (incorporated by reference from Exhibit 4.1 to Pearson's Registration Statement on Form F-1 (No. 333-43198)) 4.3 Form of Amended Deposit Agreement between Pearson plc and The Bank of New York and Form of ADR (incorporated by reference from Exhibit 4.2 to Pearson's Registration Statement on Form F-1 (No. 333-43198)) 4.4 The Family Education Company Amended and Restated 1990 Stock Option Plan 4.5 The Family Education Network, Inc. 2000 Stock Option and Incentive Plan 4.6 Pearson plc Worldwide Save for Shares Plan 5 Opinion of Freshfields Bruckhaus Deringer 23.1 Consent of PricewaterhouseCoopers 23.2 Consent of PricewaterhouseCoopers LLP 23.3 Consent of Freshfields Bruckhaus Deringer (included in Exhibit 5) 24 Powers of Attorney (included on signature page hereof)
EX-4.4 2 ex-4_4.txt EXHIBIT 4.4 THE FAMILY EDUCATION COMPANY AMENDED AND RESTATED 1990 STOCK OPTION PLAN(1) 1. DEFINITIONS. As used in this Amended and Restated 1990 Stock Option Plan of The Family Education Company, the following terms shall have the following meanings: 1.1. BOARD means the Company's Board of Directors. 1.2. CODE means the federal Internal Revenue Code of 1986, as amended. 1.3. COMMITTEE means a committee appointed by the Board, responsible for the administration of the Plan, as provided in section 5 of the Plan. 1.4. COMPANY means The Family Education Company (formerly named Educational Publishing Group, Inc.), a Delaware corporation. 1.5. EMPLOYMENT AGREEMENT means an agreement, if any, between the Company and an Optionee, setting forth, INTER ALIA, conditions and restrictions upon the transfer of shares of Stock. 1.6. FAIR MARKET VALUE means the value of a share of Stock on any date as determined by the Board, which determination shall be final, binding and conclusive. 1.7. GRANT DATE means the date as of which an Option is granted, as determined under Section 7. 1.8. INCENTIVE OPTION means an Option which by its terms is to be treated as an "incentive stock option" within the meaning of Section 422A of the Code. 1.9. NONSTATUTORY OPTION means an Option that is not an Incentive Option. 1.10. OPTION means an option to purchase shares of Stock granted under the Plan. 1.11. OPTION AGREEMENT means an agreement between the Company and an Optionee, setting forth the terms and conditions of an Option. 1.12. OPTION PRICE means the price paid by an Optionee for a share of Stock upon exercise of an Option. 1.13. OPTIONEE means a person eligible to receive an Option, as provided in Section 6, to whom an Option shall have been granted under the Plan. 1.14. PLAN means the Amended and Restated 1990 Stock Option Plan of the - ------------------- (1) This Plan was amended effective June 28, 2000, so that all references to Stock of The Family Education Company shall be deemed to be references to Pearson plc Ordinary Shares. Company, as amended from time to time. 1.15. STOCK means Common Stock, Par Value $.0001 per share, of the Company. 1.16. STOCKHOLDERS AGREEMENT means the agreement between the Company and certain shareholders, setting forth, INTER ALIA, certain restrictions upon the transfer of shares of Stock. 1.17. TEN PERCENT OWNER means a person who owns, or is deemed within the meaning of Section 422A(b)(6) of the Code to own, stock possessing more than 10% of the total combined voting power of all classes of stock of the Company (or its parent or subsidiary corporations). Whether a person is a Ten Percent Owner shall be determined with respect to each Option based on the facts existing immediately prior to the Grant Date of such Option. 1.18. VESTING YEAR for any portion of any Incentive Option means the calendar year in which that portion of the Option first becomes exercisable. 2. PURPOSE. This Plan is intended to encourage ownership of Stock by employees and consultants of the Company and its subsidiaries and to provide additional incentives for them to promote the success of the Company's business. The Plan is intended to be an incentive stock option plan within the meaning of Section 422A of the Code but not all Options granted hereunder are required to be Incentive Options. 3. TERM OF THE PLAN. Options may be granted hereunder at any time in the period commencing on the approval of the Plan by the Board and ending June 1, 2000. 4. STOCK SUBJECT TO THE PLAN. At no time shall the number of shares of Stock then outstanding which are attributable to the exercise of Options granted under the Plan, plus the number of shares then issuable upon exercise of outstanding Options granted under the Plan, exceed 6,475,000 shares, subject, however, to the provisions of Section 17 of the Plan. Shares to be issued upon the exercise of Options granted under the Plan may be either authorized but unissued shares or shares held by the Company in its treasury. If any Option expires or terminates for any reason without having been exercised in full, the shares not purchased thereunder shall again be available for Options thereafter to be granted. 5. ADMINISTRATION. Unless the Board appoints a Committee, consisting of members of the Board (in which case the Committee shall be substituted for the Board for all purposes of this Section 5), the Plan shall be administered by the Board. Subject to the provisions of the Plan, the Board shall have complete authority, in its discretion, to make or to select the manner of making the following determinations with respect to each Option to be granted by the Company: (a) the employee or consultant to receive the Option; (b) whether the Option (if granted to an employee) will be an Incentive Option or Nonstatutory Option; (c) the time of granting the Option; 2 (d) the number of shares subject to the Option; (e) the Option Price; (f) the Option period; and (g) the Option exercise date or dates. In making such determinations, the Board may take into account the nature of the services rendered by the respective employees and consultants, their present and potential contributions to the success of the Company and its subsidiaries, and such other factors as the Board in its discretion shall deem relevant. Subject to the provisions of the Plan, the Board shall also have complete authority to interpret the Plan, to prescribe, amend and rescind rules and regulations relating to it, to determine the terms and provisions of the respective Option Agreements (which need not be identical), and to make all other determinations necessary or advisable for the administration of the Plan. The Board's determinations on the matters referred to in this Section 5 shall be conclusive. 6. ELIGIBILITY. An Option shall be granted only to an employee or consultant of one or more of the Company or any subsidiary thereof. A director of one or more of the Company and any subsidiary who is not also an employee or consultant of one or more of the Company or a subsidiary shall not be eligible to receive an Option. 7. TIME OF GRANTING OPTIONS. The granting of an Option shall take place at the time specified in the Option Agreement. Only if expressly so provided in the Option Agreement, shall the Grant Date be the date on which an Option Agreement shall have been duly executed and delivered by the Company and the Optionee. 8. OPTION PRICE. The Option Price under each Incentive Option shall be not less than 100% of the Fair Market Value of Stock on the Grant Date, or not less than 110% of the Fair Market Value of Stock on the Grant Date if the Optionee is a Ten Percent Owner. The Option Price under each Nonstatutory Option shall not be so limited solely by reason of this Section 8. 9. OPTION PERIOD. No Incentive Option may be exercised later than the tenth anniversary of the Grant Date, but in any case not later than the fifth anniversary of the Grant Date, if the Optionee is a Ten Percent Owner. The Option period under each Nonstatutory Option shall not be so limited solely by reason of this Section 9. An Option may become exercisable in such installments, cumulative or non-cumulative, as the Board may determine. In the case of an Option not otherwise immediately exercisable in full, the Board may accelerate the exercisability of such Option in whole or in part at any time, provided the acceleration of the exercisability of any Incentive Option would not cause the Option to fail to comply with the provisions of Section 422A of the Code. 10. LIMIT ON INCENTIVE OPTION CHARACTERIZATION. No Incentive Option shall be considered an Incentive Option to the extent pursuant to its terms it would permit the Optionee to purchase for the first time in any Vesting Year under that Incentive Option more than the numbers of shares of Stock calculated by dividing the current limit by the Option Price. The current limit for any Optionee for any Vesting Year shall be $100,000 minus the aggregate Fair Market Value at the date of grant of the number of shares of Stock available for purchase for the first time in the Vesting Year under other Incentive Option granted to the Optionee under the Plan 3 after December 31, 1986 and each other incentive stock option granted to the Optionee after December 31, 1986 under any other incentive stock option plan of the Company (and any parent and subsidiary corporations). 11. EXERCISE OF OPTION. An Option may be exercised by the Optionee giving written notice, in the manner provided in Section 21, specifying the number of shares with respect to which the Option is then being exercised. The notice shall be accompanied by payment in the form of cash, or certified or bank check payable to the order of the Company in an amount equal to the option price of the shares to be purchased. Receipt by the Company of such notice and payment shall constitute the exercise of the Option. Within 30 days thereafter but subject to the remaining provisions of the Plan, the Company shall deliver or cause to be delivered to the Optionee or his agent a certificate or certificates for the number of shares then being purchased. Such shares shall be fully paid and nonassessable. 12. RESTRICTIONS ON ISSUE OF SHARES. (a) Notwithstanding any other provision of the Plan, if, at any time, in the reasonable opinion of the Company the issuance of shares of Stock covered by the exercise of any Option may constitute a violation of law, then the Company may delay such issuance and the delivery of a certificate for such shares until (i) approval shall have been obtained from such governmental agencies, other than the Securities and Exchange Commission, as may be required under any applicable law, rule, or regulation; and (ii) in the case where such issuance would constitute a violation of a law administered by or a regulation of the Securities and Exchange Commission, one of the following conditions shall have been satisfied: (1) the shares with respect to which such Option has been exercised are at the time of the issue of such shares effectively registered under the Securities Act of 1933, as amended (the "Securities Act"); or (2) a no-action letter in form and substance reasonably satisfactory to the Company with respect to the issuance of such shares shall have obtained by the Company from the Securities and Exchange Commission. The Company shall make all reasonable efforts to bring about the occurrence of said events. (b) Each certificate representing shares issued upon the exercise of an Option will bear restrictive legends which may refer to this Plan and to applicable restrictions under the Stockholders Agreement and Employment Agreement. 4 13. PURCHASE FOR INVESTMENT: SUBSEQUENT REGISTRATION. (a) Unless the shares to be issued upon exercise of an Option granted under the Plan have been effectively registered under the Securities Act, the Company shall be under no obligation to issue any shares covered by any Option unless the person who exercises such Option, in whole or in part, shall give a written representation to the Company which is satisfactory in form and substance to its counsel and upon which the Company may reasonably rely, that he or she is acquiring the shares issued pursuant to such exercise of the Option as an investment and not with a view to, or for sale in connection with, the distribution of any such shares. (b) Each share of Stock issued pursuant to the exercise of an Option granted pursuant to this Plan may bear a reference to the investment representation made in accordance with this Section 13 and to the fact that no registration statement has been filed with the Securities and Exchange Commission in respect to said Stock. (c) If the Company shall deem it necessary or desirable to register under the Securities Act or other applicable statutes any shares with respect to which an Option shall have been granted, or to qualify any such shares for exemption from the Securities Act or other applicable statutes, then the Company shall take such action at its own expense. The Company may require from each Option holder, or each holder of shares of Stock acquired pursuant to the Plan, such information in writing for use in any registration statement, prospectus, preliminary prospectus or offering circular as is reasonably necessary for such purpose and may require reasonable indemnity to the Company and its officers and directors from such holder against all losses, claims, damage and liabilities arising from such use of the information so furnished and caused by any untrue statement of any material fact therein or caused by the omission to state a material fact required to be stated therein or necessary to make the statement therein not misleading in the light of the circumstances under which they were made. (d) Whenever shares are to be issued in satisfaction of an Option granted hereunder, the Company shall have the right to require the Optionee to execute and deliver and otherwise become a party to the Stockholders Agreement in respect of such shares. 14. WITHHOLDING: NOTICE OF DISPOSITION OF STOCK PRIOR TO EXPIRATION OF SPECIFIED HOLDING PERIOD. (a) Whenever shares are to be issued in satisfaction of an Option granted hereunder, the Company shall have the right to require the Optionee to remit to the Company an amount sufficient to satisfy federal, state, local or other withholding tax requirements if and to the extent required by law (whether so required to secure for the Company an otherwise available tax deduction or otherwise) prior to the delivery of any certificate or certificates for such shares. (b) The Company may require as a condition to the issuance of shares covered 5 by any Incentive Option that the party exercising such Option give a written representation to the Company which is satisfactory in form and substance to its counsel and upon which the Company may reasonably rely, that he or she will report to the Company any disposition of such shares prior to the expiration of the holding periods specified by Section 422A(a)(1) of the Code. If and to the extent that the realization of income in such a disposition imposes upon the Company federal, state, local or other withholding tax requirements, or any such withholding is required to secure for the Company an otherwise available tax deduction, the Company shall have the right to require that the recipient remit to the Company an amount sufficient to satisfy those requirements; and the Company may require as a condition to the issuance of shares covered by an Incentive Option that the party exercising such option give a satisfactory written representation promising to make such a remittance. 15. TERMINATION OF ASSOCIATION WITH THE COMPANY. Subject to all other provisions of this Plan, the Board shall determine the period of time during which an Optionee may exercise an Option following (i) the termination of the Optionee's employment or association with the Company or (ii) the death or disability of the Optionee. Such periods shall be set forth in the agreement evidencing any Nonstatutory Option, but if not so specified and with respect to all Incentive Options, the limits set forth below shall apply: (i) An Option may be exercised to the extent exercisable as of the date of such cessation, within the period of ninety (90) days after the date the Optionee ceases to be an employed by or associated with the Company(or within such lesser period as may be specified in the option agreement); provided, however, that the option agreement may designate a longer exercise period, in which case, if the Option is an Incentive Option, then the exercise after such three-month period shall be treated as the exercise of a Nonstatutory Option. (ii) If the Optionee dies while an employee or consultant of the Company or within ninety (90) days after the Optionee ceases to be such an employee or consultant of the Company, the Option may be exercised by the person to whom it is transferred by will or the laws of descent and distribution within the period of one (1) year after the date of death (or within such lesser period as may be specified in the option agreement), to the extent exercisable as of the date of such cessation. (iii) If the Optionee becomes disabled while an employee or consultant of the Company, the Option may be exercised within the period of one (1) year after the date the Optionee's employment or association ceases because of such disability (or within such lesser period as may be specified in the option agreement), to the extent exercisable as of the date of such cessation. Military or sick leave shall not be deemed a termination of employment, PROVIDED that it does not exceed the longer of 90 days or the period during which the absent Optionee's reemployment rights, 6 if any, are guarantied by statute or by contract. Notwithstanding the foregoing provisions, no Option may be exercised after its expiration date. 16. TRANSFERABILITY OPTIONS. Options shall not be transferable, otherwise than by will or the laws of descent and distribution, and may be exercised during the life of the Optionee only by the Optionee. 17. ADJUSTMENT OF NUMBER OF OPTION SHARES. (a) In the event of any consolidation or merger of the Company with or into another company or in case of any sale or conveyance to another company or entity of the property of the Company as a whole or substantially as a whole (an "Acquisition"), the Options shall be assumed or equivalent options shall be substituted (giving proper credit to any Optionee for that portion of the Option which has otherwise vested and become exercisable prior to the Acquisition) by the surviving company or entity (the "Successor"); provided, however, that if such Options are not assumed by or substituted with equivalent options of the Successor, then all outstanding Options shall become exercisable in full immediately prior to the closing of such Acquisition. (b) In the event of any stock dividend payable in Stock, Stock split, or any split-up or contraction in the number of shares of Stock or any reclassification or change of outstanding shares of Stock after the date of the Option Agreement and prior to the exercise in full of the Option, the number of shares subject to such Option Agreement and the price to be paid for each share subject to the Option shall be proportionately adjusted. (c) Except as any otherwise be provided in the applicable option agreement and subject to paragraph 17(a), in the event of a consolidation or merger or sale of all or substantially all of the assets of the Company in which outstanding shares of Stock are exchanged for securities, cash or other property of any other corporation or business entity, the Board, or the board of directors of any corporation assuming the obligations of the Company, shall, in its discretion, take any one or more of the following actions, as to outstanding Options: (i) provide that such Options shall be assumed, or equivalent options shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof); (ii) upon written notice to the optionees, provide that any and all outstanding Options shall become exercisable in full (to the extent not otherwise so exercisable) as of a specified date or time ("Accelerated Vesting Date") prior to the consummation of such transaction, and that all unexercised Options shall terminate as of a specified date or time ("Accelerated Expiration Date") following the Accelerated Vesting Date unless exercised by the optionee prior to the Accelerated Expiration Date, provided, however, that optionees shall be given a reasonable period of time within which to exercise or provide for the exercise of outstanding Options following such written notice and before the Accelerated Expiration Date; (iii) in the event of a merger under the terms of which holders of the Stock of the Company will receive upon consummation thereof a cash payment for each share surrendered in the merger (the "Merger Price"), terminate each outstanding Option in exchange for a payment, made or provided for by the Company, equal in amount to the product of the excess, if any, of the Merger Price over the per-share exercise of each such Option, multiplied by the 7 number of shares of Stock subject to such Option; or (iv) terminate each outstanding Option in exchange for a cash payment equal in amount to the product of the excess, if any, of the Fair Market Value of a share of Stock over the per-share exercise price of each such Option, multiplied by the number of shares subject to such Option. (d) Notwithstanding the foregoing paragraphs 17(b) and (c), (i) the foregoing actions are subject to the approval of the Board and any accounting considerations for any Acquisition which is treated as a "pooling of interests" transaction pursuant to the Accounting Principles Board (APB) Option No. 16 and successor rules and opinions, if any discretionary action by the Board would otherwise violate the accounting rules for treatment of the Acquisition as "pooling of interests", and (ii) the foregoing actions are subject to approval of the Board and considerations of tax and accounting implications if any such adjustment would cause any Incentive Option granted under the Plan to fail to qualify as an incentive stock option within the meaning of Section 422 of the Code. Upon dissolution or liquidation of the Company, the Option shall terminate, but the Optionee (if at the time in the employ or retained as a consultant of the Company or any of its subsidiaries) shall have the right, immediately prior to such dissolution or liquidation, to exercise the Option to the extent exercisable on the date of such dissolution or liquidation. No fraction of a share shall be purchasable or deliverable upon exercise, but in the event any adjustment hereunder of the number of shares covered by the Option shall cause such number to include a fraction of a share, such number of shares shall be adjusted to the nearest smaller whole number of shares. In the event of changes in the outstanding Stock by reason of any stock dividend, split-up, contraction, reclassification, or change of outstanding shares of Stock of the nature contemplated by this Section 17, the number of shares of Stock available for the purpose of the Plan as stated in Section 4 shall be correspondingly adjusted. 18. RESERVATION OF STOCK. The Company shall at all times during the term of the Option reserve or otherwise keep available such number of shares of Stock as will be sufficient to satisfy the requirements of the Plan and shall pay all fees and expenses necessarily incurred by the Company in connection therewith. 19. LIMITATION OF RIGHTS IN STOCK: NO SPECIAL EMPLOYMENT OR OTHER RIGHTS. The Optionee shall not be deemed for any purpose to be a stockholder of the Company with respect to any of the shares of Stock covered by an Option, except to the extent that the Option shall have been exercised with respect thereto and, in addition, a certificate shall have been issued therefor and delivered to the Optionee or his agent. Any Stock issued pursuant to the Option shall be subject to all restrictions upon the transfer thereof which may be now or hereafter imposed by the Certificate of Incorporation, the By-laws of the Company, the Stockholders Agreement and the Employment Agreement. Nothing contained in the Plan or in any Option shall confer upon any Optionee any right with respect to the continuation of his or her employment with, or retention as a consultant by, the Company (or any subsidiary), or interfere in any way with the right of the Company (or any subsidiary), subject to the terms of any separate employment or consulting agreement or provision of law or corporate articles or by-laws to the contrary, at any time to 8 terminate such employment or consulting agreement or to increase or decrease the compensation of the Optionee from the rate in existence at the time of the grant of an Option. 20. TERMINATION AND AMENDMENT OF THE PLAN. The Board may at any time terminate the Plan or make such modifications of the Plan as it shall deem advisable. No termination or amendment of the Plan may, without the consent of the Optionee to whom any Option shall theretofore have been granted, adversely affect the rights of such Optionee under such Option. 21. NOTICES AND OTHER COMMUNICATIONS. All notices and other communications required or permitted under the Plan shall be effective if in writing and if delivered or sent by certified or registered mail, return receipt requested (a) if to the Optionee, at his or her residence address last filed with the Company, and (b) if to the Company, at 20 Park Plaza, Suite 1215, Boston, MA 02116, Attention: President, with a copy to the Secretary of the Company, or to such other persons or addresses as the Optionee or the Company may specify by a written notice to the other from time to time. 9 EX-4.5 3 ex-4_5.txt EXHIBIT 4.5 Exhibit 4.5 THE FAMILY EDUCATION NETWORK, INC.(1) 2000 STOCK OPTION AND INCENTIVE PLAN 1. PURPOSE AND ELIGIBILITY The purpose of this 2000 Stock Option and Incentive Plan (the "PLAN") of The Family Education Network, Inc. (the "COMPANY") is to provide stock options and other equity interests in the Company (each an "AWARD") to employees, officers, directors, consultants and advisors of the Company and its Subsidiaries, all of whom are eligible to receive Awards under the Plan. Any person to whom an Award has been granted under the Plan is called a "PARTICIPANT". Additional definitions are contained in Section 8. 2. ADMINISTRATION a. ADMINISTRATION BY BOARD OF DIRECTORS. The Plan will be administered by the Board of Directors of the Company (the "BOARD"). The Board, in its sole discretion, shall have the authority to grant and amend Awards, to adopt, amend and repeal rules relating to the Plan and to interpret and correct the provisions of the Plan and any Award. All decisions by the Board shall be final and binding on all interested persons. Neither the Company nor any member of the Board shall be liable for any action or determination relating to the Plan. b. APPOINTMENT OF COMMITTEES. To the extent permitted by applicable law, the Board may delegate any or all of its powers under the Plan to one or more committees or subcommittees of the Board (a "COMMITTEE"). All references in the Plan to the "BOARD" shall mean such Committee or the Board. c. DELEGATION TO EXECUTIVE OFFICERS. To the extent permitted by applicable law, the Board may delegate to one or more executive officers of the Company the power to grant Awards and exercise such other powers under the Plan as the Board may determine, PROVIDED THAT the Board shall fix the maximum number of Awards to be granted and the maximum number of shares issuable to any one Participant pursuant to Awards granted by such executive officers. 3. STOCK AVAILABLE FOR AWARDS a. NUMBER OF SHARES. Subject to adjustment under Section 3(c), the aggregate number of shares of Common Stock of the Company (the "COMMON STOCK") that may be issued pursuant to the Plan is 2,800,000 shares. If any Award expires, or is terminated, surrendered or forfeited, in whole or in part, the unissued Common Stock covered by such Award shall again be available for the grant of Awards under the Plan. If shares of Common Stock issued pursuant to the Plan are repurchased by, or are surrendered or forfeited to, the Company at no more than cost, such shares of Common Stock shall again be available for the grant of Awards under the Plan; PROVIDED, HOWEVER, that the cumulative number of such shares that may be so reissued under the Plan will not exceed 2,800,000 shares. Shares issued under the Plan may consist in whole or in part of authorized but unissued shares or treasury shares. - ------------------- (1) This Plan was amended effective June 28, 2000, so that all references to Common Stock of The Family Education Network, Inc., shall be deemed to be references to Pearson plc Ordinary Shares. b. PER-PARTICIPANT LIMIT. Subject to adjustment under Section 3(c), no Participant may be granted Awards during any one fiscal year to purchase more than 1,000,000 shares of Common Stock. c. ADJUSTMENT TO COMMON STOCK. In the event of any stock split, stock dividend, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, combination, exchange of shares, liquidation, spin-off, split-up, or other similar change in capitalization or event, (i) the number and class of securities available for Awards under the Plan and the per-Participant share limit, (ii) the number and class of securities, vesting schedule and exercise price per share subject to each outstanding Option, (iii) the repurchase price per security subject to repurchase, and (iv) the terms of each other outstanding stock-based Award shall be adjusted by the Company (or substituted Awards may be made) to the extent the Board shall determine, in good faith, that such an adjustment (or substitution) is appropriate. If Section 7(e)(i) applies for any event, this Section 3(c) shall not be applicable. 4. STOCK OPTIONS a. GENERAL. The Board may grant options to purchase Common Stock (each, an "OPTION") and determine the number of shares of Common Stock to be covered by each Option, the exercise price of each Option and the conditions and limitations applicable to the exercise of each Option and the Common Stock issued upon the exercise of each Option, including vesting provisions, repurchase provisions and restrictions relating to applicable federal or state securities laws, as it considers advisable. b. INCENTIVE STOCK OPTIONS. An Option that the Board intends to be an "incentive stock option" as defined in Section 422 of the Code (an "INCENTIVE STOCK OPTION") shall be granted only to employees of the Company and shall be subject to and shall be construed consistently with the requirements of Section 422 of the Code. The Board and the Company shall have no liability if an Option or any part thereof that is intended to be an Incentive Stock Option does not qualify as such. An Option or any part thereof that does not qualify as an Incentive Stock Option is referred to herein as a "NONSTATUTORY STOCK OPTION". c. EXERCISE PRICE. The Board shall establish the exercise price (or determine the method by which the exercise price shall be determined) at the time each Option is granted and specify it in the applicable option agreement. d. DURATION OF OPTIONS. Each Option shall be exercisable at such times and subject to such terms and conditions as the Board may specify in the applicable option agreement. e. EXERCISE OF OPTION. Options may be exercised only by delivery to the Company of a written notice of exercise signed by the proper person together with payment in full as specified in Section 4(f) for the number of shares for which the Option is exercised. 2 f. PAYMENT UPON EXERCISE. Common Stock purchased upon the exercise of an Option shall be paid for by one or any combination of the following forms of payment: (i) by check payable to the order of the Company; (ii) except as otherwise explicitly provided in the applicable option agreement, and only if the Common Stock is then publicly traded, delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price, or delivery by the Participant to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price; or (iii) to the extent explicitly provided in the applicable option agreement, by (x) delivery of shares of Common Stock owned by the Participant valued at fair market value (as determined by the Board or as determined pursuant to the applicable option agreement), (y) delivery of a promissory note of the Participant to the Company (and delivery to the Company by the Participant of a check in an amount equal to the par value of the shares purchased), or (z) payment of such other lawful consideration as the Board may determine. 5. RESTRICTED STOCK. a. GRANTS. The Board may grant Awards entitling recipients to acquire shares of Common Stock, subject to (i) delivery to the Company by the Participant of a check in an amount at least equal to the par value of the shares purchased, and (ii) the right of the Company to repurchase all or part of such shares at their issue price or other stated or formula price from the Participant in the event that conditions specified by the Board in the applicable Award are not satisfied prior to the end of the applicable restriction period or periods established by the Board for such Award (each, a "RESTRICTED STOCK AWARD"). b. TERMS AND CONDITIONS. The Board shall determine the terms and conditions of any such Restricted Stock Award. Any stock certificates issued in respect of a Restricted Stock Award shall be registered in the name of the Participant and, unless otherwise determined by the Board, deposited by the Participant, together with a stock power endorsed in blank, with the Company (or its designee). After the expiration of the applicable restriction periods, the Company (or such designee) shall deliver the certificates no longer subject to such restrictions to the Participant or, if the Participant has died, to the beneficiary designated by a Participant, in a manner determined by the Board, to receive amounts due or exercise rights of the Participant in the event of the Participant's death (the "DESIGNATED BENEFICIARY"). In the absence of an effective designation by a Participant, Designated Beneficiary shall mean the Participant's estate. 6. OTHER STOCK-BASED AWARDS The Board shall have the right to grant other Awards based upon the Common Stock having such terms and conditions as the Board may determine, including, without limitation, the 3 grant of shares based upon certain conditions, the grant of securities convertible into Common Stock and the grant of stock appreciation rights, phantom stock awards or stock units. 7. GENERAL PROVISIONS APPLICABLE TO AWARDS a. TRANSFERABILITY OF AWARDS. Except as the Board may otherwise determine or provide in an Award, Awards shall not be sold, assigned, transferred, pledged or otherwise encumbered by the person to whom they are granted, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the life of the Participant, shall be exercisable only by the Participant. References to a Participant, to the extent relevant in the context, shall include references to authorized transferees. b. DOCUMENTATION. Each Award under the Plan shall be evidenced by a written instrument in such form as the Board shall determine or as executed by an officer of the Company pursuant to authority delegated by the Board. Each Award may contain terms and conditions in addition to those set forth in the Plan PROVIDED THAT such terms and conditions do not contravene the provisions of the Plan. c. BOARD DISCRETION. The terms of each type of Award need not be identical, and the Board need not treat Participants uniformly. d. TERMINATION OF STATUS. The Board shall determine the effect on an Award of the disability, death, retirement, authorized leave of absence or other change in the employment or other status of a Participant and the extent to which, and the period during which, the Participant, or the Participant's legal representative, conservator, guardian or Designated Beneficiary, may exercise rights under the Award. e. ACQUISITION OF THE COMPANY (i) CONSEQUENCES OF AN ACQUISITION. (A) ACQUISITION AND TREATMENT OF OPTIONS AND AWARDS. Unless otherwise expressly provided in the applicable Award, upon the occurrence of an Acquisition, the Board or the board of directors of the surviving or acquiring entity (as used in this Section 7(e)(i)(A), also the "BOARD"), shall, as to outstanding Awards (on the same basis or on different bases, as the Board shall specify), make appropriate provision for the continuation of such Awards by the Company or the assumption of such Awards by the surviving or acquiring entity and by substituting on an equitable basis for the shares then subject to such Awards either (a) the consideration payable with respect to the outstanding shares of Common Stock in connection with the Acquisition, (b) shares of stock of the surviving or acquiring corporation or (c) such other securities as the Board deems appropriate, the fair market value of which (as determined by the Board in its sole discretion) shall not materially differ from the fair market value of the shares of Common Stock subject to such Awards immediately preceding the Acquisition. In addition to or in lieu of the foregoing, with respect to outstanding Options, the Board may, upon written notice to the affected optionees, provide that one or more Options then 4 outstanding shall become immediately exercisable in full and that such Options must be exercised within a specified number of days of the date of such notice, at the end of which period such Options shall terminate; or provide that one or more Options then outstanding shall become immediately exercisable in full and shall be terminated in exchange for a cash payment equal to the excess of the fair market value (as determined by the Board in its sole discretion) for the shares subject to such Options over the exercise price thereof. (B) ACCELERATION UPON ACQUISITION. Subject to the terms herein, each employee or officer of the Company who holds an Option or Award granted under this Plan and who is employed by the Company at the effective time of the Acquisition (an "ELIGIBLE PARTICIPANT") and each other person or entity who holds an Option or Award shall maintain the same vesting schedule with respect to such Option or Award, as set forth in the applicable stock option agreement or other agreement with respect to such Option or Award. Notwithstanding anything to the contrary herein, each Outstanding Option and Award held by an Eligible Participant immediately prior to the effective time of the Acquisition shall vest in accordance with the vesting schedule set forth in the applicable stock option agreement or other agreement with respect to such Option or Award calculated as if (i) the Vesting Start Date was one (1) year prior to the actual Vesting Start Date set forth in such agreement if the Eligible Participant does not have and is not offered a Comparable Position (as defined herein) with the ultimate surviving or acquiring entity (the "Survivor") upon the closing of such Acquisition, or if such Comparable Position is terminated by the Survivor without cause (as defined in the applicable Option Agreement) within one (1) year thereafter, and such Eligible Participant had been employed by the Company for greater than six months but less than one year as of the effective time of the Acquisition; or (ii) the Vesting Start Date was two (2) years prior to the actual Vesting Start Date set forth in such agreement if the Eligible Participant does not have and is not offered a Comparable Position (as defined herein) with the Survivor upon the closing of such Acquisition, or if such Comparable Position is terminated by the Survivor without cause (as defined in the applicable Option Agreement) within one (1) year thereafter, and if such Eligible Participant had been employed by the Company for one year or more as of the effective time of the Acquisition. For purposes of this Agreement, "COMPARABLE POSITION" shall mean a position with the Survivor or any subsidiary of the Survivor of at least substantially similar compensation, with duties and reporting responsibilities not materially diminished in nature or status from the position held with the Company by such Eligible Participant immediately prior to the Acquisition, and which position shall be located within a reasonable proximity (not to exceed 45 miles) of the working location from which the Eligible Participant was based immediately prior to the time of the Acquisition. Any determination by the Board in good faith as to whether or not a position is a Comparable Position was terminated without cause, shall be dispositive and final. (C) ACQUISITION DEFINED. An "ACQUISITION" shall mean: (x) any merger or consolidation after which the voting securities of the Company outstanding immediately prior thereto represent (either by remaining outstanding or by being converted into voting securities of the Survivor) less than 50% of the combined voting power of the voting securities of the Survivor outstanding immediately after such event; or (y) any sale of all or substantially all of the assets or capital stock of the Company (other than in a spin-off, migratory merger or similar 5 transaction) or (z) any other acquisition of the business of the Company, as determined by the Board. (ii) ASSUMPTION OF OPTIONS UPON CERTAIN EVENTS. In connection with a merger or consolidation of an entity with the Company or the acquisition by the Company of property or stock of an entity, the Board may grant Awards under the Plan in substitution for stock and stock-based awards issued by such entity or an affiliate thereof. The substitute Awards shall be granted on such terms and conditions as the Board considers appropriate in the circumstances. (iii) POOLING-OF-INTERESTS ACCOUNTING. If the Company proposes to engage in an Acquisition intended to be accounted for as a pooling-of-interests, and in the event that the provisions of this Plan or of any Award hereunder, or any actions of the Board taken in connection with such Acquisition, are determined by the Company's or the acquiring company's independent public accountants to cause such Acquisition to fail to be accounted for as a pooling-of-interests, then such provisions or actions shall be amended or rescinded by the Board, without the consent of any Participant, to be consistent with pooling-of-interests accounting treatment for such Acquisition. (iv) PARACHUTE AWARDS. Notwithstanding the provisions of Section 7(e)(i)(A), if, in connection with an Acquisition described therein, a tax under Section 4999 of the Code would be imposed on the Participant (after taking into account the exceptions set forth in Sections 280G(b)(4) and 280G(b)(5) of the Code), then the number of Awards which shall become exercisable, realizable or vested as provided in such section shall be reduced (or delayed), to the minimum extent necessary, so that no such tax would be imposed on the Participant (the Awards not becoming so accelerated, realizable or vested, the "PARACHUTE AWARDS"); PROVIDED, HOWEVER, that if the,"AGGREGATE PRESENT VALUE" of the Parachute Awards would exceed the tax that, but for this sentence, would be imposed on the Participant under Section 4999 of the Code in connection with the Acquisition, then the Awards shall become immediately exercisable, realizable and vested without regard to the provisions of this sentence. For purposes of the preceding sentence, the "AGGREGATE PRESENT VALUE" of an Award shall be calculated on an after-tax basis (other than taxes imposed by Section 4999 of the Code) and shall be based on economic principles rather than the principles set forth under Section 280G of the Code and the regulations promulgated thereunder. All determinations required to be made under this Section 7(e)(iv) shall be made by the Board. f. WITHHOLDING. Each Participant shall pay to the Company, or make provisions satisfactory to the Company for payment of, any taxes required by law to be withheld in connection with Awards to such Participant no later than the date of the event creating the tax liability. The Board may allow Participants to satisfy such tax obligations in whole or in part by transferring shares of Common Stock, including shares retained from the Award creating the tax obligation, valued at their fair market value (as determined by the Board or as determined pursuant to the applicable option agreement). The Company may, to the extent permitted by law, deduct any such tax obligations from any payment of any kind otherwise due to a Participant. 6 g. AMENDMENT OF AWARDS. The Board may amend, modify or terminate any outstanding Award including, but not limited to, substituting therefor another Award of the same or a different type, changing the date of exercise or realization, and converting an Incentive Stock Option to a Nonstatutory Stock Option, PROVIDED THAT, except as otherwise provided in Section 7(e)(iii), the Participant's consent to such action shall be required unless the Board determines that the action, taking into account any related action, would not materially and adversely affect the Participant. h. CONDITIONS ON DELIVERY OF STOCK. The Company will not be obligated to deliver any shares of Common Stock pursuant to the Plan or to remove restrictions from shares previously delivered under the Plan until (i) all conditions of the Award have been met or removed to the satisfaction of the Company, (ii) in the opinion of the Company's counsel, all other legal matters in connection with the issuance and delivery of such shares have been satisfied, including any applicable securities laws and any applicable stock exchange or stock market rules and regulations, and (iii) the Participant has executed and delivered to the Company such representations or agreements as the Company may consider appropriate to satisfy the requirements of any applicable laws, rules or regulations. i. ACCELERATION. The Board may at any time provide that any Options shall become immediately exercisable in full or in part, that any Restricted Stock Awards shall be free of some or all restrictions, or that any other stock-based Awards may become exercisable in full or in part or free of some or all restrictions or conditions, or otherwise realizable in full or in part, as the case may be, despite the fact that the foregoing actions may (i) cause the application of Sections 280G and 4999 of the Code if a change in control of the Company occurs, or (ii) disqualify all or part of the Option as an Inventive Stock Option. 8. MISCELLANEOUS a. DEFINITIONS. (i) "COMPANY," for purposes of eligibility under the Plan, shall include any present or future subsidiary corporations of The Family Education Network, Inc., as defined in Section 424(f) of the Code (a "SUBSIDIARY"), and any present or future parent corporation of The Family Education Network, Inc., as defined in Section 424(e) of the Code. For purposes of Awards other than Incentive Stock Options, the term "COMPANY" shall include any other business venture in which the Company has a direct or indirect significant interest, as determined by the Board in its sole discretion. (ii) "CODE" means the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder. (iii) "EMPLOYEE" for purposes of eligibility under the Plan (but not for purposes of Section 4(b)) shall include a person to whom an offer of employment has been extended by the Company. 7 b. NO RIGHT TO EMPLOYMENT OR OTHER STATUS. No person shall have any claim or right to be granted an Award, and the grant of an Award shall not be construed as giving a Participant the right to continued employment or any other relationship with the Company. The Company expressly reserves the right at any time to dismiss or otherwise terminate its relationship with a Participant free from any liability or claim under the Plan. c. NO RIGHTS AS STOCKHOLDER. Subject to the provisions of the applicable Award, no Participant or Designated Beneficiary shall have any rights as a stockholder with respect to any shares of Common Stock to be distributed with respect to an Award until becoming the record holder thereof. d. EFFECTIVE DATE AND TERM OF PLAN. The Plan shall become effective on the date on which it is adopted by the Board. No Awards shall be granted under the Plan after the completion of ten years from the date on which the Plan was adopted by the Board, but Awards previously granted may extend beyond that date. e. AMENDMENT OF PLAN. The Board may amend, suspend or terminate the Plan or any portion thereof at any time. f. GOVERNING LAW. The provisions of the Plan and all Awards made hereunder shall be governed by and interpreted in accordance with the laws of Massachusetts, without regard to any applicable conflicts of law. Adopted by the Board of Directors on 1/19/00 ---------------------------- Approved by the stockholders on 2/17/00 ---------------------------- 8 EX-4.6 4 a2024798zex-4_6.txt EXHIBIT 4.6 Exhibit 4.6 PEARSON PLC WORLDWIDE SAVE FOR SHARES PLAN 1. PURPOSE The Pearson plc. Worldwide Save for Shares Plan ("the Plan") is intended to provide an opportunity to participate in the ownership of shares of the common stock of Pearson plc ("the Parent Company") for eligible employees of Pearson Inc. ("the Company") and such other companies ("Participating Companies") as the Committee (as defined below) shall from time to time designate; provided that each such company shall qualify as a "parent corporation" or "subsidiary corporation", as defined in Section 424(e) and (f) of the Internal Revenue Code of 1986, as amended ("the Code"), on the first day of the relevant Award Period as defined in Section 4. Because the Shares (as defined below) are not registered in the USA there shall be no sale of Shares to employees under this Plan and the savings accumulated by relevant employees pursuant to the Plan shall not be used to acquire any such Shares. 2. ADMINISTRATION The Plan shall be administered by a committee ("the Committee") appointed by the Board of Directors of the Company ("the Board"). The Committee shall have full authority to administer the Plan, including authority to interpret and construe any provision of the Plan and to adopt such rules and regulations for administering the Plan as it may deem necessary. The Committee may delegate part or all of its obligations and authority hereunder to one or more employees or directors of the Company or the Parent Company or a subsidiary corporation, in which case the term "Committee" shall relate to such delegate. Decisions of the Committee shall be final and binding on all parties who have an interest in the Plan. 3. EFFECTIVE DATE AND TERM OF PLAN The Plan shall come into effect on 1 January 1998 and, unless cancelled or discontinued earlier pursuant to Sections 10 or 12 , as appropriate, shall have a life of 10 years. 4. AWARD PERIODS The Plan shall have one or more Award Periods each of which shall commence with the granting of an Award (as defined in Section 7 below). The first day and the length of any such Award Period shall be determined by the Committee, provided that no such period shall exceed 27 months. The Committee shall designate the final day of each Award Period so as to facilitate administration of the Plan. Award Periods need not be of the same length and may run successively or concurrently, either in whole or in part. 5. ELIGIBILITY AND PARTICIPATION Each employee of the Company or any of the Participating Companies shall be eligible to participate in the Plan in respect of an Award Period except (i) employees who are included in a unit covered by a collective bargaining agreement between the Company or any of the Participating Companies and the employee representatives under which benefits were the subject of good faith bargaining, unless the terms of such bargaining agreement otherwise provides, (ii) employees who have not completed an introductory period of service of six months (or such other minimum period of service as may be specified by the Committee) as of the first day of that Award Period (such service meaning, for these purposes, service with the Company, a Participating Company or an acquired employer), (iii) any one or more category of employees excluded in the sole discretion of the Committee who are members of that classification of employees described in Code Section 423(b)(4), (iv) at the discretion of the Committee, any employee who is not compensated on a salaried or full-commission basis and (v) such other class 2 of employees as the Committee may specify. All eligible employees may become participants with respect to an Award Period by executing such instruments or taking such other action, if any, as the Committee may from time to time specify. 6. STOCK (a) The stock subject to the Plan shall be shares of the common stock of the Parent Company ("Shares") which are authorised but unissued or which have been acquired by open market purchase. The aggregate amount of stock which may be issued or transferred pursuant to the Plan shall not exceed 5,000,000 Shares (subject to any adjustment as provided in Section 9 ). (b) Notwithstanding the provisions of Section 6(a) above, if Shares are to be issued pursuant to the Plan then the maximum number of Shares over which Awards may be granted on any date ("the Award Limit"), when added to the number of Shares issued or placed under an Award which may lead to an issue of Shares, within the ten years preceding that date under the Plan or any other share incentive or option plan approved by the Parent Company, shall not exceed ten per cent of the issued ordinary share capital of the Parent Company on such date. 7. AWARDS Awards shall be granted in such form and subject to such terms as the Committee may from time to time approve, provided that such Awards shall conform to the following terms and conditions: (a) AWARD CONCEPT. Each Award granted under the Plan shall be in the form of a stock appreciation right over Shares ("the Award"). The Award will be based upon a monthly savings agreement (as described in Section 8) under which an eligible employee (as described in Section 5) agrees to save a monthly sum on an after-tax basis. The formula for determining the number of Shares subject to an Award shall be as follows: 3 N = MS * 26 / NSP * (ESP-NSP) / ESP Where: N is the number of Shares subject to the Award rounded down to a whole number of Shares MS is the monthly level of savings of the relevant employee NSP is the Net Share Price, being the Fair Market Value of a Share at the time of the invitation to participate less a discount of 15% ESP is the Ending Share Price, being the Fair Market Value of a Share at the end of an Award Period. The number of Shares to be taken into account for the purposes of the Award Limit shall be calculated as follows in respect of each participant and aggregated appropriately: N = MS * 26 / NSP (b) FAIR MARKET VALUE. For the purposes of the Plan the fair market value of the Shares on any day shall be the middle market quotation for a Share on the London Stock Exchange Limited (as derived from the Daily Official List for the previous trading day). (c) PAYMENT. The maximum MS (excluding interest) which may be taken into account under the Plan may not exceed a percentage specified by the Committee (not to exceed 15 percent) of a participant's Compensation calculated as of a day (determined by the Committee) for each Award Period, or if less, the $US equivalent, at a rate of exchange to be specified by the Parent Company at its discretion, of the monthly limit set out for the time being in paragraph 24(2)(a) of Schedule 9 to the United Kingdom Income and Corporation Taxes Act 1988 (currently L250). For the purposes of this Plan, "Compensation" shall mean the base compensation (plus, for sales representatives, sales-related fees and sales commissions) paid to a participant by the Company or a 4 Participating Company (exclusive of any bonuses, pay at premium rates (holiday, overtime or other), gifts, cost of group life insurance, imputed cost of use of employer property, reimbursement of moving expenses, deferred compensation, other amounts which are not included in the participant's income for federal income tax purposes, and any compensation received prior to becoming a participant in the Plan.) Compensation shall include any amounts deferred under a salary reduction agreement or any plan maintained by a Participating Company pursuant to Section 401(k) or Section 125 of the Code. (c) NUMBER OF SHARES. On the first day of any Award Period, a participant shall be granted an Award to receive a number of Shares determined by the Committee pursuant to Section 7(a). If the Award Limit for which Awards are to be granted on any date in accordance with the terms of the Plan exceeds the number of Shares then remaining available under the Plan (after deduction of the number of Shares which have been issued pursuant to Awards or are then subject to Awards), the Committee shall make a pro rata allocation to participants of the Shares remaining available in as near as uniform a manner as shall be practicable and as it shall deem equitable. The Committee shall give written notice of such allocation to each participant affected thereby. (d) TERMINATION OF EMPLOYMENT. If, prior to the end of an Award Period, a participant ceases to be employed by the Company or a Participating Company for any reason, including death or retirement, the participant's Award shall terminate, and any amounts collected from the participant, together with interest thereon, shall be paid to the participant or the participant's personal representatives and no further amounts will be collected from the participant during the Award Period. (e) TERMINATION OF AWARD. A participant may, during an Award Period, terminate his or her Award, by giving written notice, in such manner and at such times as the Committee may specify. If an Award is terminated, any amounts collected from the participant, together with interest thereon, shall be paid to the participant as soon as practicable following 5 receipt of such notice, no further amounts will be collected from the participant during the Award Period and the Award shall thereupon terminate. (f) CHANGES IN STATUS. The Committee may determine on a uniform basis with respect to any Award Period whether a participant who is on a leave of absence or on salary continuation or who experiences a significant reduction in pay beyond the participant's control or converts from a salaried to an hourly position will be deemed to have terminated service for purposes of Section 7(d) or under what circumstances such a participant may continue his or her Award in effect during such Award Period. (g) VESTING OF SHARES. Shares subject to an Award shall vest automatically on the last day of the Award Period, unless the Award has been previously terminated pursuant to Section 7(d), 7(e) or 8(d). . Subject to Section 7(l), such Shares shall be issued or transferred to the relevant participant as soon as practicable after they have vested. The balance in the participant's account (including interest) shall be promptly paid to the participant. (h) ASSIGNABILITY. Awards under the Plan shall not be assignable or transferable by the participant and shall be exercisable only by the participant. (i) RIGHTS AS A SHAREHOLDER. A participant shall have no rights as a shareholder with respect to Shares subject to any Award until the Shares vest pursuant to Section 7(g) above. No adjustments will be made for dividends or other rights for which the record date is prior to the date of delivery. (j) 5% SHAREHOLDERS. No Award shall be granted to an employee if immediately after such grant the employee would own (within the meaning of Section 424(d) of the Code) or hold, outstanding Awards over stock possessing 5 percent or more of the total combined voting power or value of all classes of stock of the Parent Company or any of its subsidiary corporations. 6 (k) WITHHOLDING. The Company and any Participating Companies will be entitled to withhold, and the participant will be obliged to pay, any amount of tax or social security contributions or other regulatory payments payable by or on behalf of such participant in connection with the vesting of Shares. The Committee may establish appropriate procedures to provide for any such payment. (l) Upon vesting in accordance with Section 7 (g), Shares issued to a participant pursuant to the Plan shall be held in escrow on behalf of such participant by a custodian in the United Kingdom (the "Custodian"), selected by the Committee, in accordance with applicable provisions of English law and such other terms and conditions which the Committee (and the Custodian) may from time to time specify. Each participant shall receive a statement from the Custodian with regard to shares held on such participant's behalf and each participant shall receive the benefit of any dividends on Shares held by the Custodian for their account. A participant may effect the sale of Shares held on behalf of such participant by the Custodian by instructing the Custodian to sell all or a portion of his or her holdings on the London Stock Exchange. The Custodian will sell such Shares only in accordance with resale provisions of Rule 904 of Regulation S under the Securities Act of 1933. Net proceeds from such a sale of Shares shall be delivered to the relevant participant in $US. Participants may not sell Shares issued pursuant to the Plan by any means other than through the Custodian, nor shall a participant (nor shall his estate or other legal successor) be entitled to withdraw Shares from the Custodian or otherwise receive a stock certificate for Shares so long as the participant is a U. S. Person for purposes of the Securities Act of 1933. 8. MONTHLY SAVINGS AGREEMENTS (a) ELECTION. An eligible employee may elect the monthly amount which he wishes to save, provided that such amount must be not less than the US Dollar equivalent of L5 nor more than the US Dollar equivalent of L250. The Parent Company shall decide upon the appropriate rate of exchange to use in calculating the US Dollar equivalents and shall notify the Company and Participating Companies accordingly. The maximum limit of 7 the US Dollar equivalent of L250 applies to a participant's aggregate monthly contributions in respect of all savings agreements under this Plan. (b) PERSONAL PROPERTY. The relevant monthly sum shall be deducted from an employee's pay by payroll deduction and will be deposited in an interest-bearing account with a US Bank. The savings agreement is personal to the relevant employee and the savings and any interest arising under it are the property of the employee concerned. (c) NO PAYMENT. No amount shall be payable by a participant in respect of the receipt of an Award of Shares. No amounts saved shall be used to purchase Shares and amounts saved shall not be affected by changes in the market value of Shares. (d) MISSED CONTRIBUTIONS. If a participant misses any monthly contributions under the Savings Contract, then unless the participant is on unpaid medical leave or on unpaid leave under the Family Medical Leave Act the Award will terminate with the same consequences as set out in Rule 7(e) (Termination of Award). If a participant is on unpaid medical leave or on unpaid leave under the Family Medical Leave Act and misses up to six monthly contributions under the Savings Contract, the number of Shares due to the participant will be reduced by multiplying the number of Shares calculated in Rule 7(a) by the fraction n/24, where n is equal to the number of monthly contributions made in the Award Period. If more than six contributions are missed, however, the Award will terminate with the same consequences as set out in Rule 7(e) (Termination of Award). 8 (e) LEAVE OF ABSENCE. If a participant is on paid leave or other absence from work in which regular pay is continued then there will be continuing payroll deductions for the purposes of the Plan unless the participant elects to terminate the Award in accordance with the provisions of Rule 7 (e)(Termination of Award). 9. CAPITAL ADJUSTMENTS If any change is made in the Shares subject to the Plan, or subject to any Award granted under the Plan (through merger, consolidation, reorganisation, stock dividend, split-up, combination of Shares, exchange of Shares, change in corporate structure or otherwise), appropriate adjustments shall be made as determined by the Parent Company in its absolute discretion as to the maximum number of Shares subject to the Plan, and the number of Shares and price per Share subject to outstanding Awards. 10. AMENDMENTS The Board or Committee may from time to time alter, amend, suspend or discontinue the Plan at any time provided, however, that no such action may, without the approval of shareholders of the Company, (i) increase the number of Shares subject to the Plan under the provisions of Section 6(a) (unless necessary to effect the adjustments required under Section 9), or (ii) make any other change with respect to which the Board or Committee determines that shareholder approval is required by applicable law or regulatory standards. Subject to Section 12 and 14, no such alterations or amendments may be made which would adversely affect existing Awards granted under the Plan. 11. NO EMPLOYMENT OBLIGATION Nothing contained in the Plan (or in any Award granted pursuant to the Plan) shall confer upon any employee any right to continue in the employ of the Company or any Participating Company or constitute any contract or agreement of employment or interfere in any way with the right of 9 the Company or any Participating Company to reduce such employee's compensation from the rate in existence at the time of the granting of an Award or to terminate such employee's employment at any time, with or without cause. 12. CANCELLATION AND SUBSTITUTION OF AWARDS IF SHARES ARE REGISTERED In the event that the Shares are registered with the Securities and Exchange Commission such that the grant of an option and sale of Shares would be lawful then the Committee shall have the right to shorten the length of the Award Period in respect of any existing Awards. Shares subject to such Awards shall subsequently vest on the last day of such Award Period in accordance with Section 7(g). 13. REGULATORY APPROVALS The implementation of the Plan, the granting of any Award under the Plan and the issuance of Shares pursuant to any such Award shall be subject to the Company's, and where necessary, the Parent Company's, procurement of all approvals and permits required by regulatory authorities having jurisdiction over the Plan, the Awards granted under it or the Shares issued pursuant to it. 14. RESTRICTIONS ON AWARDS AND ACQUIRED SHARES No Awards shall be granted under the Plan, and no Shares shall be issued and delivered upon the vesting of Awards granted under the Plan, unless and until any applicable Federal or state registration, listing and qualification requirements and any other requirements of law or of any regulatory agencies having jurisdiction shall have been fully complied with (or exceptions from the foregoing are available) and each Award granted shall specifically be conditioned upon compliance with this sentence. The Committee, in its discretion, may, as a condition to the grant of an Award or the vesting of any Award granted under the Plan, require the holder of such Award to make such representations and warranties as are deemed appropriate by the Company. Stock certificates representing Shares that have not been registered under the Securities Act of 10 1933 and were acquired upon the vesting of Awards shall bear substantially the following legend or such other legend which may be required by the Committee: "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE PLEDGED, HYPOTHECATED, SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION OF COUNSEL TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OR SOLD OUTSIDE OF THE UNITED STATES IN COMPLIANCE WITH REGULATION S OF SUCH ACT." The Committee may impose such other terms, conditions and restrictions upon any Award, including any Award previously granted, that the Committee concludes, in its discretion, are necessary or desirable to ensure compliance with any applicable law, regulation or rule. 15. GOVERNING LAW To the extent not otherwise governed by federal law, the Plan and its implementation shall be governed by and construed in accordance with the laws of the State of New York. 11 EX-5 5 a2024798zex-5.txt EXHIBIT 5 Exhibit 5 [LETTERHEAD OF FRESHFIELDS BRUCKHAUS DERINGER] The Directors Pearson plc 3 Burlington Garden London WIX ILE 1 September 2000 Dear Sirs REGISTRATION STATEMENT ON FORM S-8 This opinion is given in connection with the registration under the United States Securities Act of 1933, as amended (the ACT), of 1,532,510 ordinary shares of 25p each (the SHARES) in the capital of Pearson plc, a company registered in England and Wales, (the COMPANY) to be issued pursuant to the Plans as defined below and as a consequence of Company obligations resulting from a merger agreement dated 28 June 2000. We understand that a registration statement on Form S-8 (the REGISTRATION STATEMENT) is being filed under the Act with respect to the Shares. We are acting as English legal advisors to the Company for the purposes of giving this opinion. In so acting, we have examined: (i) the Registration Statement to be filed under the Act; (ii) a copy of the rules of following plans (the PLANS): (a) The Family Education Company Amended and Restated 1990 Stock Option Plan; (b) The Family Education Network, Inc. 2000 Stock Option and Incentive Plan; (c) Pearson plc Worldwide Save for Shares Plan; Page 2 of 3 (iii) a copy of the Company's Certificate of Incorporation dated 12 August 1897, a copy of the Certificate of Incorporation on Re-registration as a public limited company dated 26 June 1981 and a copy of the Certificate of Incorporation on Change of Name dated 1 June 1984; (iv) copies of the Memorandum and Articles of Association of the Company in force as at 3 August 2000 (the MEMORANDUM and the ARTICLES respectively); and (v) such other documents as we deem necessary to form this opinion and relied upon the statements as to factual matters contained in or made pursuant to each of the above mentioned documents. Where relevant facts material to this opinion were not independently established, we have relied upon statements of officers of the Company. In considering the above documents and in rendering this opinion we have with your consent and without any further enquiry assumed: (i) the Shares will be issued and paid for in accordance with the terms of the Plans, the memorandum and articles of association of the company in force at the relevant time and the relevant provisions of the United Kingdom Companies Act of 1985, as amended; (ii) the genuineness of all signatures on, and the authenticity and completeness of, all documents submitted to us whether as originals or copies; (iii) the conformity to originals of all documents supplied to us as photocopies or facsimile copies; (iv) that the Certificate of Incorporation on Re-registration as a public limited company dated 26 June 1981 and the Certificate of Incorporation on Change of Name dated 1 June 1984 and the Memorandum and the Articles have not been amended and are currently in force; (v) that each of the Shareholder Meetings and each additional general meeting of the shareholders of the Company at which resolutions were passed in connection with the allotment and issue of Ordinary Shares and the establishment of the Plans was validly convened and constituted; that the resolutions referred to in the minutes of such meetings were duly passed and have not been amended, modified or revoked and are in full force and effect, and that such minutes are a true and correct record of the proceedings described therein; (vi) that each of the meetings and each additional general meeting at which resolutions were passed in connection with the establishment and administration of the Plans was validly convened and constituted; that any necessary shareholder or stockholder or other authorities were duly obtained; that the resolutions referred to in the minutes of such Page 3 of 3 meetings were duly passed and have not been amended, modified or revoked and are in full force and effect, and that such minutes are a true and correct record of the proceedings described therein; (vii) full compliance by the Company with the provisions of the Plans; and (viii) the plans have not been amended or altered. Based on relying solely upon the foregoing, we confirm that, in our opinion, the Shares, or any portion thereof, when issued by the Company pursuant to the Plans after the Registration Statement has become effective under the Act, will be validly issued, fully paid and non-assessable. For the purposes of this opinion, we have assumed that the term "non-assessable" in relation to the Shares means under English law that holders of such Shares, in respect of which all amounts due on such Shares as to the nominal amount and any premium thereon have been fully paid, will be under no obligation to contribute to the liabilities of the Company solely in their capacity as holders of such Shares. This opinion is limited to English law as currently applied by the English courts and is given on the basis that it will be governed by and construed in accordance with current English law. Accordingly, we express no opinion with regard to any system of law other than the law of England as currently applied by the English courts. This opinion is given to you solely for your benefit and for the purposes of the Registration Statement to be filed under the Act. It is not to be transmitted to any other person nor is it to be relied upon by any other person or for any purposes or quoted or referred to in any public document without our prior written consent, except that we consent to the filing of this opinion as an Exhibit to the Registration Statement. In giving this consent, we do not thereby admit that we come within the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Securities and Exchange Commission promulgated thereunder. Yours faithfully /s/ Freshfields Bruckhaus Deringer EX-23.1 6 a2024798zex-23_1.txt EXHIBIT 23.1 Exhibit 23.1 [PRICEWATERHOUSECOOPERS LETTERHEAD] CONSENT OF INDEPENDENT ACCOUNTS We hereby consent to the incorporation by reference in this Registration Statement on Form S-8 of our report dated March 6, 2000 except for the information presented in Notes 31 and 34, for which the date is May 12, 2000 relating to the consolidated financial statements for the year ended December 31, 1999 which appears in Pearson plc's Form F-1, Registration Statement (No. 333-43198) dated August 7, 2000. /s/ PricewaterhouseCoopers - -------------------------- PricewaterhouseCoopers September 1, 2000 EX-23.2 7 a2024798zex-23_2.txt EXHIBIT 23.2 Exhibit 23.2 [PRICEWATERHOUSECOOPERS LETTERHEAD] CONSENT OF INDEPENDENT ACCOUNTS We hereby consent to the incorporation by reference in this Registration Statement on Form S-8 of Pearson plc of our report dated June 17, 1998 relating to the carve-out financial statements of Simon & Schuster (Excluding Consumer), which appears in Pearson plc's Form F-1, Registration Statement (No. 333-43198). /s/ PricewaterhouseCoopers LLP - ------------------------------ PricewaterhouseCoopers LLP New York, New York August 31, 2000 -----END PRIVACY-ENHANCED MESSAGE-----