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Exhibit 10(iii)(A) 4
LUCENT TECHNOLOGIES INC. 1996 LONG TERM INCENTIVE PROGRAM ("PLAN")
NONSTATUTORY STOCK OPTION AGREEMENT
NAME SOCIAL SECURITY NO. GRANT DATE EXPIRATION DATE
((FIRST_NAME)) ((LAST_NAME)) ((SSN)) ((GRANT_DATE)) ((EXPIRE_DATE))
Capitalized terms not otherwise defined herein shall have the same meanings as
in the Plan.
You have been granted, as of the Grant Date set forth above, an option (the
"Option") under the Plan to purchase from Lucent Technologies Inc. ("Lucent")
((GRANT)) common shares, par value $.01, of Lucent ("Shares") at the price of
((PRICE)) per Share, subject to the terms and conditions of the Plan and this
agreement.
1. EXERCISABILITY OF OPTION. This Option may be exercised at any time prior to
its Expiration Date or cancellation as follows:
(a) 1/4th of the shares covered by this Option shall become exercisable on
the first anniversary of the Grant Date. 1/48th of the shares covered by this
Option shall become exercisable each month thereafter. The number of shares that
becomes exercisable on any date will be rounded down to the next lowest whole
number, and any fraction of a share shall be added to the portion of the Option
becoming exercisable the following month.
(b) Upon the termination of your employment by reason of Retirement, any
portion of this Option which is then exercisable will remain exercisable until
the Expiration Date and any portion of this Option which is not then exercisable
will be canceled.
(c) Upon the termination of your employment by reason of death or
Disability, any portion of this Option which is not then exercisable will become
exercisable and, along with any portion of this Option which is then
exercisable, will remain exercisable until the Expiration Date.
(d) Upon the termination of your employment for Cause, this Option will be
canceled.
(e) Upon the termination of your employment as a result of a Company
Action, any portion of this Option that is then exercisable shall remain
exercisable until the earlier of the ninetieth day from the date of termination
or the Expiration Date, and the Company Action Vesting Portion shall not be
forfeited and canceled and shall become immediately exercisable until the
earlier of the ninetieth day after termination of employment or the original
Expiration Date. "Company Action Vesting Portion" is determined as of the date
of termination of employment and shall be the portion of the Option computed as
follows (but not less than zero):
Company Action Vesting Portion = N x M/D - E
where:
N = the number of shares originally subject to the Option,
M = the number of complete months elapsed since the Grant Date,
D = the number of complete months between the Grant Date and
the date on which the Option was originally scheduled to
become completely exercisable, and
E = the number of Shares covered by the Option for which the
Option has already become exercisable (regardless of whether
the Option has been exercised with respect to such Shares).
If your employment terminates under circumstances constituting both a
Company Action and Retirement, the Company Action Vesting Portion shall become
exercisable on the termination date and, together with any portion of the Option
which was already exercisable, shall remain exercisable until the Expiration
Date.
(f) Upon the termination of your employment for any reason other than
Retirement, death or Disability Cause or Company Action, any portion of this
Option which is then exercisable will remain exercisable until the earlier of
the ninetieth day after termination of employment or the original Expiration
Date and any portion of this Option which is not then exercisable will be
canceled.
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(g) It will not be considered a termination of your employment if you (i)
transfer to or from Lucent and any Affiliate or (ii) are placed on an approved
leave of absence. Unless otherwise determined by the Committee, it will be
considered a termination of employment if your employer ceases to be Lucent or
an Affiliate.
2. DEFINITIONS.
(a) RETIREMENT. "Retirement" means termination of employment with Lucent or
any of its Affiliates under any of the following circumstances or entitlements:
(i) Service Pension under the Lucent Retirement Income Plan as
defined in such plan;
(ii) Minimum Retirement Benefit under the Lucent Supplemental
Pension Plan as defined in such plan;
(iii) Similar pension under any plan of Lucent that is a
successor to or offered in substitution for one or more of
the foregoing plans;
(iv) Pension of a type similar to those described in (i) through
(iii) under any plan of an Affiliate that adopts reasonable
standards and criteria for benefit entitlement; or
(v) You are at least age 50 with a minimum of 15 years service
or your age and years of service at the time of termination
add up to at least 75.
(b) DISABILITY. "Disability" means termination of employment under
circumstances entitling you to any of the following benefits:
(i) Disability Pension under the Lucent Retirement Income Plan;
(ii) Disability Benefit under the Long Term Disability Plan for
Management Employees of Lucent;
(iii) Similar disability benefits under any plan of Lucent that
is a successor to or offered in substitution for one or
more of the foregoing plans; or
(iv) Disability benefits of a type similar to those described in
(i) through (iii) under any plan of an Affiliate that
adopts reasonable standards and criteria for benefit
entitlement.
(c) CAUSE. "Cause" means:
(i) violation of Lucent's code of conduct, Business Guideposts;
(ii) conviction of (including a plea of guilty or nolo
contendere) of a felony or any crime of theft, dishonesty
or moral turpitude, or
(iii) gross omission or gross dereliction of any statutory or
common law duty of loyalty to Lucent.
3. EXERCISE PROCEDURE. This Option shall be exercised by delivering a notice to
Lucent using the method prescribed by Lucent for this purpose. The Option or any
portion thereof may be exercised only upon payment of the exercise price thereof
in full, and in accordance with procedures established by the Committee. Payment
shall be made in cash or in Shares or a combination of cash and Shares such that
the total of the cash plus the Fair Market Value, as determined in accordance
with procedures established by the Committee, of the Shares on the date of
exercise at least equals the aggregate exercise price of the Shares as to which
the Option is being exercised; provided, however, that any Shares surrendered as
payment must have been owned by you at least six months prior to the date of
exercise. Exercise of the Option shall take effect on the date the notice of
exercise is actually received in accordance with procedures specified by Lucent.
4. ISSUANCE OF LUCENT SHARES. Following exercise of any portion of this Option,
Lucent will issue the number of Shares purchased under this Option. Neither you
nor anyone else shall be, or have any of the rights and privileges of, a
shareholder of Lucent in respect of any Shares purchasable upon the exercise of
this Option, in whole or in part, unless and until such Shares shall have been
issued.
5. TRANSFERABILITY. (a) This Option is not transferable by you otherwise than by
will or the laws of descent and distribution, and during your lifetime the
Option may be exercised only by you or your guardian or legal representative.
(b) You may, in accordance with procedures established by the Committee,
designate one or more beneficiaries to receive all or part of the Option in case
of your death, and you may change or revoke such designation at any time. Such
designation shall not be effective unless and until the Senior Vice
President-Human Resources or the Vice President of Compensation, Benefits and
Health Services shall determine, on advice of counsel, that exercise of the
Option by your beneficiary(ies) does not require any registration,
qualification, consent or approval of any securities exchange or governmental or
regulatory agency or authority. In the event of your death, any portion of this
Option that is subject to such a designation (to the extent such designation is
valid, effective and enforceable under this Agreement and applicable law) shall
be distributed to such beneficiary or beneficiaries in accordance with this
Agreement. Any other portion of this Option shall be distributable to your
estate. If there shall be any question as to
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the legal right of any beneficiary to receive a distribution hereunder, or to
the extent your designation is not effective, such portion may be exercised by
your estate, in which event neither Lucent nor any Affiliate shall have any
further liability to anyone with respect to such Option.
6. NO RIGHT OF EMPLOYMENT. Neither the Plan nor this Agreement shall be
construed as giving you the right to be retained in the employ of Lucent or any
Affiliate.
7. REGULATORY APPROVALS. If the Senior Vice President-Human Resources or the
Vice President of Compensation, Benefits and Health Services of the Company, or
their successor, determines, on advice of counsel, that the listing,
registration or qualification of Shares upon any securities exchange or under
any law, or the consent or approval of any governmental or regulatory agency or
authority, is necessary or desirable as a condition of, or in connection with,
the exercise of the Option, no portion of the Option may be exercised until or
unless such listing, registration, qualification, consent or approval shall have
been effected or obtained. The foregoing shall not be construed as requiring any
such listing, registration, qualification, consent or approval.
8. DETERMINATIONS OF THE COMMITTEE. Any determinations or decisions made or
actions taken arising out of or in connection with the interpretation and
administration of this Agreement and the Plan by the Committee shall be final
and conclusive.
9. AMENDMENTS. This Agreement may be amended by the Committee provided that no
such amendment shall impair your rights hereunder without your consent.
10. TAXES. Lucent may withhold or require payment of taxes or social insurance
payments due upon the exercise of this Option. Payments may be paid in cash or a
combination of cash and shares if permitted by the Administrator.
11. GOVERNING LAW. The validity, construction and effect of this Agreement shall
be determined in accordance with the laws of the State of Delaware without
giving effect to principles of conflicts of laws.
12. VALUE OF OPTION. Lucent makes no representation as to the value of this
Option or whether you will be able to realize any profit out of it.
13. BLACK OUT PERIODS. In connection with significant corporate transactions or
developments such as spin-offs or stock splits, Lucent reserves the right to
designate periods during which you may not exercise this Option.
Please indicate your acceptance of terms 1-13, and acknowledge that you have
received a copy of the Plan as currently in effect, by signing at the place
provided and returning the original of this Agreement.
ACCEPTED AND AGREED: LUCENT TECHNOLOGIES INC.
SIGNATURE BY
VICE PRESIDENT
