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Exhibit 10.3
2005 LONG-TERM INCENTIVE PLAN
<<YEAR>> STOCK OPTION AWARD AGREEMENT
United States Cellular Corporation, a Delaware corporation (the
"Company"), hereby grants to <<NAME>> (the "Optionee"),
as of <<DATE>> (the "Option Date"), pursuant to the
provisions of the United States Cellular Corporation 2005 Long-Term
Incentive Plan, as amended (the "Plan"), a Non-Qualified Stock
Option (the "Option") to purchase from the Company <<# OF
SHARES>> shares of Stock at the price of <<STRIKE
PRICE>> per share upon and subject to the terms and
conditions set forth below. Capitalized terms not defined
herein shall have the meanings specified in the Plan.
1.
Time and Manner of Exercise of
Option
1.1.
Exercise of Option. (a) In
general . Except as otherwise provided in this Award
Agreement, the Option shall become exercisable according to the
following vesting schedule:
·
1/3 of grant vests on <<FIRST ANNIVERSARY OF
GRANT DATE>>
·
1/3 of grant vests on <<SECOND ANNIVERSARY OF
GRANT DATE>>
·
Remaining 1/3 of grant vests on <<THIRD
ANNIVERSARY OF GRANT DATE>>
Except as otherwise provided in this Award Agreement, in no
event may the Option be exercised, in whole or in part, after
<<TENTH ANNIVERSARY OF GRANT DATE>> (the "Expiration
Date").
(b)
Disability . If the Optionee’s employment by or
service with the Employers and Affiliates terminates by reason of
Disability, then the Option shall be exercisable only to the extent
it is exercisable on the effective date of the Optionee’s
termination of employment or service and after such date may be
exercised by the Optionee (or the Optionee’s Legal
Representative) for a period of 12 months after the effective date
of the Optionee’s termination of employment or service, or
until the Expiration Date, whichever period is shorter. If
the Optionee shall die within such exercise period, then the Option
shall be exercisable by the beneficiary or beneficiaries duly
designated by the Optionee to the same extent the Option was
exercisable by the Optionee on the date of the Optionee’s
death, for a period ending on the later of (i) the last day of
such exercise period and (ii) the 180 day anniversary of the
Optionee’s death.
(c)
Special Retirement . If the Optionee’s
employment by or service with the Employers and Affiliates
terminates by reason of Special Retirement (as defined below), then
the Option immediately shall become exercisable in full if
(i) the Optionee has attained age 66 as of the effective date
of the Optionee’s Special Retirement and (ii) the
effective date of the Optionee’s Special Retirement occurs on
or after January 1, <<CALENDAR YEAR COMMENCING AFTER
OPTION DATE>>. If the Optionee’s employment by or
service with the Employers and Affiliates terminates by reason of
Special Retirement and either (i) the Optionee has not
attained age 66 as of the effective date of the Optionee’s
Special Retirement or (ii) the effective date of the
Optionee’s Special Retirement occurs before January 1,
<<CALENDAR YEAR COMMENCING AFTER OPTION DATE>>, then
the Option shall be exercisable only to the extent it is
exercisable on the effective date of the Optionee’s Special
Retirement. The Option, to the extent then exercisable, may
be exercised by the Optionee (or the Optionee’s Legal
Representative) for a period of 12 months after the effective date
of the Optionee’s Special Retirement, or until the Expiration
Date, whichever period is shorter. If the Optionee shall
die
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within such exercise period, then the Option shall be
exercisable by the beneficiary or beneficiaries duly designated by
the Optionee to the same extent the Option was exercisable by the
Optionee on the date of the Optionee’s death, for a period
ending on the later of (i) the last day of such exercise
period and (ii) the 180 day anniversary of the
Optionee’s death. For purposes of this Award Agreement,
"Special Retirement" shall mean an Optionee’s termination of
employment or service with the Employers and Affiliates on or after
the later of (i) the Optionee’s attainment of age 62 and
(ii) the Optionee’s Early Retirement Date or Normal
Retirement Date, as such terms are defined in the Telephone and
Data Systems, Inc. Pension Plan.
(d)
Retirement . If the Optionee’s employment by or
service with the Employers and Affiliates terminates by reason of
Retirement (as defined below), then the Option immediately shall
become exercisable in full if (i) the Optionee has attained
age 66 as of the effective date of the Optionee’s Retirement
and (ii) the effective date of the Optionee’s Retirement
occurs on or after January 1, <<CALENDAR YEAR COMMENCING
AFTER OPTION DATE>>. If the Optionee’s employment
by or service with the Employers and Affiliates terminates by
reason of Retirement and either (i) the Optionee has not
attained age 66 as of the effective date of the Optionee’s
Retirement or (ii) the effective date of the Optionee’s
Retirement occurs before January 1, <<CALENDAR YEAR
COMMENCING AFTER OPTION DATE>>, then the Option shall be
exercisable only to the extent it is exercisable on the effective
date of the Optionee’s Retirement. The Option, to the
extent then exercisable, may be exercised by the Optionee (or the
Optionee’s Legal Representative) for a period of 90 days
after the effective date of the Optionee’s Retirement, or
until the Expiration Date, whichever period is shorter. If
the Optionee shall die within such exercise period, then the Option
shall be exercisable by the beneficiary or beneficiaries duly
designated by the Optionee to the same extent the Option was
exercisable by the Optionee on the date of the Optionee’s
death, for a period ending on the 180 day anniversary of the
Optionee’s death. For purposes of this Award Agreement,
"Retirement" shall mean an Optionee’s termination of
employment or service with the Employers and Affiliates on or after
the Optionee’s attainment of age 65 that does not satisfy the
definition of "Special Retirement" set forth in
Section 1.1(c).
(e)
Resignation with Prior Consent of the Board . If the
Optionee’s employment by or service with the Employers and
Affiliates terminates by reason of the Optionee’s resignation
of employment or service with the prior consent of the Board (as
evidenced in the Company’s minute book), then the Option
shall be exercisable only to the extent it is exercisable on the
effective date of the Optionee’s resignation and after such
date may be exercised by the Optionee (or the Optionee’s
Legal Representative) for a period of 90 days after the effective
date of the Optionee’s resignation, or until the Expiration
Date, whichever period is shorter. If the Optionee shall die
within such exercise period, then the Option shall be exercisable
by the beneficiary or beneficiaries duly designated by the Optionee
to the same extent the Option was exercisable by the Optionee on
the date of the Optionee’s death, for a period ending on the
180 day anniversary of the Optionee’s death.
(f)
Death . If the Optionee’s employment by or
service with the Employers and Affiliates terminates by reason of
death, then the Option shall be exercisable only to the extent it
is exercisable on the date of death and after such date may be
exercised by the beneficiary or beneficiaries duly designated by
the Optionee for a period ending on the 180 day anniversary of the
Optionee’s death.
(g)
Other Termination of Employment or Service . If the
Optionee’s employment by or service with the Employers and
Affiliates terminates for any reason other than Disability, Special
Retirement, Retirement, resignation of employment or service with
the prior consent of the Board (as evidenced in the Company’s
minute book) or death, then the Option shall be exercisable only to
the extent it is exercisable on the effective date of the
Optionee’s termination of employment or service and after
such
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date may be exercised by the Optionee (or the Optionee’s
Legal Representative) for a period of 30 days after the effective
date of the Optionee’s termination of employment or service,
or until the Expiration Date, whichever period is shorter. If
the Optionee shall die within such exercise period, then the Option
shall be exercisable by the beneficiary or beneficiaries duly
designated by the Optionee to the same extent the Option was
exercisable by the Optionee on the date of the Optionee’s
death, for a period ending on the 180 day anniversary of the
Optionee’s death. Notwithstanding the first sentence of
this subsection (g), if the Optionee ceases to be employed by or to
perform services for the Employers and Affiliates on account of the
Optionee’s negligence, willful misconduct, competition with
an Employer or other Affiliate or misappropriation of confidential
information of an Employer or other Affiliate, then the Option
shall terminate on the date the Optionee’s employment or
service terminates, unless such Option terminates earlier pursuant
to Section 1.2.
(h)
Expiration of Option During Blackout Period . If the
Option shall expire under any of subsections (a) through
(g) of this Section 1.1 during a period when the Optionee
and family members or other persons living in the household of such
persons are prohibited from trading in securities of the Company
pursuant to the Telephone and Data Systems, Inc. Policy
Regarding Insider Trading and Confidentiality (or any successor
policy thereto) (a "Blackout Period"), the period during which the
Option is exercisable shall be extended to the date that is 30 days
after the date of the termination of the Blackout Period.
(i)
Expiration of Option During Suspension Period . If the
Option shall expire under any of subsections (a) through
(g) of this Section 1.1 during a period when the exercise
of the Option would violate applicable securities laws (a
"Suspension Period"), the period during which the Option is
exercisable shall be extended to the date that is 30 days after the
date of the termination of the Suspension Period.
1.2.
Termination of Option and Forfeiture of Option
Gain Upon Competition or Misappropriation of Confidential
Information . (a) Notwithstanding any other
provision herein, if the Optionee enters into competition with an
Employer or other Affiliate or misappropriates confidential
information of an Employer or other Affiliate, as determined by the
Committee or the Company in its sole discretion, then (i) as
of the date of such competition or misappropriation, the Option
granted pursuant to this Award Agreement automatically shall
terminate and thereby be forfeited to the extent it has not been
exercised and (ii) the Optionee shall pay the Company, within
five business days of receipt by the Optionee of a written demand
therefore, an amount in cash determined by multiplying the number
of shares of Stock purchased pursuant to each exercise of the
Option within the six months immediately preceding such competition
or misappropriation (without reduction for any shares of Stock
delivered by the Optionee or withheld by the Company pursuant to
Section 1.3 or Section 2.4) by the difference between
(i) the Fair Market Value of a share of Stock on the date of
such exercise and (ii) the purchase price per share of Stock
set forth in the first paragraph of this Award Agreement. The
Optionee acknowledges and agrees that the Option, by encouraging
stock ownership and thereby increasing an employee’s
proprietary interest in the Company’s success, is intended as
an incentive to participating employees to remain in the employ of
an Employer or other Affiliate. The Optionee acknowledges and
agrees that this Section 1.2(a) is therefore fair and
reasonable, and not a penalty.
(b)
The Optionee may be released from the Optionee’s obligations
under this Section 1.2 only if and to the extent the Committee
determines in its sole discretion that such release is in the best
interests of the Company.
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(c)
The Optionee agrees that by executing this Award Agreement the
Optionee authorizes the Employers and any Affiliate to deduct any
amount owed by the Optionee pursuant to
Section 1.2(a) from any amount payable by the Employers
or any Affiliate to the Optionee, including, without limitation,
any amount payable to the Optionee as salary, wages, vacation pay
or bonus. This right of setoff shall not be an exclusive
remedy and an Employer’s or an Affiliate’s election not
to exercise this right of setoff with respect to any amount payable
to the Optionee shall not constitute a waiver of this right of
setoff with respect to any other amount payable to the Optionee or
any other remedy. For purposes of Section 1.2(a), the
Optionee shall be treated as entering into competition with an
Employer or other Affiliate if the Optionee (i) directly or
indirectly, individually or in conjunction with any person, firm or
corporation, has contact with any customer of an Employer or other
Affiliate or any prospective customer which has been contacted or
solicited by or on behalf of an Employer or other Affiliate for the
purpose of soliciting or selling to such customer or prospective
customer any product or service, except to the extent such contact
is made on behalf of an Employer or other Affiliate;
(ii) directly or indirectly, individually or in conjunction
with any person, firm or corporation, becomes employed in the
business or engages in the business of providing wireless products
or services in any geographic territory in which an Employer or
other Affiliate offers such products or services or has plans to do
so within the next twelve months or (iii) otherwise competes
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