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Exhibit 10.1
CORPORATE
OFFICER
TELEPHONE AND DATA SYSTEMS,
INC.
2004 LONG-TERM INCENTIVE PLAN
<<YEAR>> STOCK OPTION AWARD AGREEMENT
Telephone and Data Systems, Inc., a Delaware
corporation (the "Company"), hereby grants to
<<NAME>> (the "Optionee"), as of
<<DATE>> (the "Option Date"), pursuant to the
provisions of the Telephone and Data Systems, Inc. 2004
Long-Term Incentive Plan (As Amended and Restated) (the "Plan"), a
Non-Qualified Stock Option (the "Option") to purchase from the
Company <<NUMBER>> shares of Special Common
Stock at the price of $ <<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 (i) on the first annual
anniversary of the Option Date with respect to one-third of the
number of shares of Special Common Stock subject to the Option on
the Option Date; (ii) on the second annual anniversary of the
Option Date with respect to an additional one-third of the number
of shares of Special Common Stock subject to the Option on the
Option Date; and (iii) on the third annual anniversary of the
Option Date with respect to the remaining one-third of the number
of shares of Special Common Stock subject to the Option on the
Option Date. Except as otherwise provided in this Award
Agreement in connection with the Optionee’s death, in no
event may the Option be exercised, in whole or in part, after
<<TENTH ANNIVERSARY OF OPTION DATE>> (the
"Expiration Date").
(b) Disability . If the Optionee ceases to be
employed by or of service to the Employers and Affiliates by reason
of Disability, 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, 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
ceases to be employed by or of service to the Employers and
Affiliates by reason of Special Retirement (as defined below), 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 ceases to be employed by
or of service to the Employers and Affiliates 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>> , 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
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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 within
such exercise period, 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 ceases to be
employed by or of service to the Employers and Affiliates by reason
of Retirement (as defined below), 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
ceases to be employed by or of service to the Employers and
Affiliates 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>> ,
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
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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, 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 ceases to be employed by or of service to
the Employers and Affiliates by reason of the Optionee’s
resignation of employment or service at any age with the prior
consent of the board of directors of such Optionee’s Employer
(as evidenced in the Employer’s minute book), 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 such effective
date or until the Expiration Date, whichever period is
shorter. If the Optionee shall die within such exercise
period, 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 ceases to be
employed by or of service to the Employers and Affiliates by reason
of death, the Option shall be exercisable only to the extent it is
exercisable on the date of death, and may be exercised by the
beneficiary or beneficiaries duly designated by the Optionee for a
period ending on the 180 day anniversary
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of the Optionee’s death.
(g) Other Termination of Employment or Service
. If the Optionee ceases to be employed by or of service to
the Employers and Affiliates for any reason other than Disability,
Special Retirement, Retirement, resignation of employment or
service with the prior consent of the board of directors of the
Optionee’s Employer (as evidenced in the Employer’s
minute book) or death, 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 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, the Option shall be
exercisable only to the extent it is exercisable on the date of
death and 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. Notwithstanding
any provision in this Award Agreement to the contrary, if the
Optionee ceases to be employed by or of service to 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, the Option shall terminate on the date the
Optionee’s employment or service with the Employers and
Affiliates 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
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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
. Notwithstanding any other provision herein, the Option
granted pursuant to this Award Agreement shall not be exercisable
on or after any date on which 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 Company in its sole discretion. 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.
In the event of such competition or misappropriation, the Optionee
shall pay the Company, within five business days of receipt by the
Optionee of a written demand therefor, 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
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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 is therefore fair and reasonable, and not a
penalty.
For purposes of the preceding paragraph, 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 with 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,
telephone or broadband 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 with an Employer or other
Affiliate in any manner or otherwise engages in the business of an
Employer or other Affiliate.
The Optionee shall be treated as misappropriating confidential
information of an Employer or other Affiliate if the Optionee
(i) uses confidenti
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