TERMS AND CONDITIONS FOR
EMPLOYEES
2001 Omnibus Incentive Compensation
Plan
These Terms and Conditions, dated
, govern the grant of stock options (“Options”) under
the 2001 Omnibus Incentive Compensation Plan (the
“Plan”) to Gannett employees (the “Option
Holder”), as set forth below. Terms used herein that are
defined in the Plan shall have the meaning ascribed to them in the
Plan. If there is any inconsistency between the defined terms of
these Terms and Conditions and the terms of the Plan, the
Plan’s terms shall supersede and replace the conflicting
terms herein.
1. Grant of Options . Pursuant to
the provisions of (i) the Plan, (ii) the individual
Letter Agreements governing each grant, and (iii) these Terms
and Conditions, the Company has granted to the Option Holder the
number of options (“Options”) to purchase the number of
shares of common stock of the Company (“Common Stock”)
set forth on the applicable Letter Agreement, at the purchase price
per share stated in such Letter Agreement (“Option
Price”).
2. Exercisability . Except as
otherwise provided in Sections 14 and 15 below, the Options
shall become exercisable as specified in the relevant Letter
Agreement. The Options may be partially exercised from time to time
within such percentage limitations, but no partial exercise of the
Options will be permitted for less than ten shares of Common Stock.
In no event shall the Options be exercisable in whole or in part
after the Option Expiration Date specified in the relevant Letter
Agreement. Upon an Option Holder’s termination of employment
with the Company following the Option Holder’s
(a) death, (b) permanent disability (as determined under
the Company’s Long Term Disability Plan) or
(c) retirement at or after age 65 or early retirement at or
after age 55 in accordance with the Company’s policies (i.e.,
the Option Holder’s termination of employment occurs when the
Option holder is at least age 55 and has at least 5 years of
service), those Options awarded to the Option Holder will continue
to vest and may be exercised as described in Sections 6 and 7
below. Upon any other termination of employment, the Options will
be automatically canceled.
3. Method of Exercising Options .
The Options may be exercised from time to time by written or
electronic notice (in the form prescribed by the Company) delivered
to and received by the Company (unless the Option Holder elects to
make a “cashless exercise”), which notice shall be
signed by the Option Holder and shall state the election to
exercise the Options and the number of whole shares of Common Stock
with respect to which the Options are being exercised. Such notice
must be accompanied by a check payable to the Company, or such
other consideration allowed pursuant to the Plan, in payment of the
full Option Price for the number of shares purchased. As soon as
practicable after it receives such notice and payment, as
applicable, and following receipt from the Option Holder of payment
for any taxes which the Company is required by law to withhold by
reason of such exercise, the Company will deliver to the Option
Holder a certificate or certificates for the shares of Common Stock
so purchased. Options may also be exercised by the delivery of
shares in payment of the Option Price or pursuant to a
“cashless exercise” procedure, subject to securities
law restrictions, or by any other means the Executive Compensation
Committee of the Company (the “Committee”), in its sole
discretion, determines is consistent with the Plan’s purpose
and applicable law. The delivery of previously acquired shares may
be made by attestation. Payment of any withholding taxes due upon
exercise of Options may be made by withholding shares.
4. Reduction in Number Of Shares
Subject to Options . Upon the exercise of one or more Options,
the number of shares of Common Stock subject to the Options shall
be reduced one-for-one.
5.
Forfeiture and Cancellation of Options .
(a) Expiration of Term . On the
Expiration Date, the unexercised Options shall be canceled
automatically.
(b) Termination of Employment .
Except as provided in Sections 6, 7, 14 and 15 below, or
except as otherwise determined by the Committee in its sole
discretion, the Options shall automatically be canceled upon
termination of the Option Holder’s employment with the
Company or any of its subsidiaries for any reason, which includes
an event that results in the Option Holder’s employer ceasing
to be a subsidiary of the Company. A change in status from Employee
to Director, or from Director to Employee, shall not result in the
cancellation of the Options or have an effect on the vesting
schedule.
(c)
Forfeiture of Option Gains Because of Misconduct.
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(i) The Option Holder shall reimburse the
Company the amount of the gross option gain realized or obtained by
the Option Holder or any transferee resulting from the exercise of
any Company stock options during the twelve-month period following
the first public issuance or filing with the United States
Securities and Exchange Commission (whichever first occurred) of a
financial document as to which the Company subsequently prepared
and issued or filed a “Restatement” (as defined
below).
(ii) This reimbursement requirement shall
only apply to Option Holders who either: (a) knowingly or
negligently engaged in the misconduct referred to in paragraph
5(c)(iv), or knowingly or negligently failed to prevent such
misconduct, or (b) are subject to automatic forfeiture under
Section 304 of the Sarbanes-Oxley Act of 2002.
(iii) The gross option gain to be
reimbursed shall be measured at the date of exercise and shall be
equal to the difference between the Fair Market Value of the
purchased Common Stock on the date of exercise and the exercise
price paid by the Option Holder therefore.
(iv) For purposes of this section,
“Restatement” means an accounting restatement the
Company is required to prepare due to the material noncompliance of
the Company, as a result of misconduct, with any financial
reporting requirement under the securities laws.
6. Death of Option Holder . Except
as provided in Section 15 below, upon the death of the Option
Holder, the Options vested at the time of such death may be
exercised by the Option Holder’s estate, or by a person who
acquires the right to exercise the Options by bequest or
inheritance or by reason of the death of the Option Holder,
provided that such exercise occurs both before the Option
Expiration Date and within three years after the Option
Holder’s death. Any Options not vested as of the Option
Holder’s death will continue vesting during this
post-termination exercise period in accordance with the
Options’ original vesting schedule. Upon the expiration of
such post-termination exercise period, all unexercised vested
Options and all unvested Options will be canceled.
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7. Retirement or Disability .
Except as provided in Section 15 below, upon termination of
the Option Holder’s employment (i) by reason of
permanent disability, as determined under the Company’s Long
Term Disability Plan, or (ii) retirement at or after age 65 or
early retirement at or after age 55 in accordance with the
Company’s policies (i.e., the Option Holder’s
termination of employment occurs when the Option holder is at least
age 55 and has at least 5 ye
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