YEAR>> RESTRICTED STOCK UNIT AWARD AGREEMENT
Exhibit 10.4
<<YEAR>> RESTRICTED STOCK UNIT AWARD AGREEMENT
United States Cellular Corporation, a Delaware corporation (the "Company"), hereby grants to
Xxxxxxx X. Xxxxxx (the "Employee") as of <<DATE>>> (the "Grant Date"), pursuant to the provisions of the United States Cellular Corporation 2013 Long-Term Incentive Plan (the "Plan"), a Restricted Stock Unit Award (the "Award") with respect to <<# OF SHARES>> shares of Common Stock, upon and subject to the restrictions, terms and conditions set forth below. Capitalized terms not defined herein shall have the meanings specified in the Plan.
1. Award Subject to Acceptance of Award Agreement
The Award shall become null and void unless the Employee accepts this Award Agreement by executing it in the space provided at the end hereof and returning it to the Company.
2. Restriction Period and Forfeiture
(a) In General. Except as otherwise provided in this Award Agreement, the Award shall become nonforfeitable and the Restriction Period with respect to the Award shall terminate on the third annual anniversary of the Grant Date (the “Three-Year Anniversary Date”), provided that the Employee remains continuously employed by the Employers and Affiliates until the Three-Year Anniversary Date. Within sixty (60) days following the Three-Year Anniversary Date, the Company shall issue to the Employee in a single payment the shares of Common Stock subject to the Award on the Three-Year Anniversary Date.
(b) Death. If the Employee separates from employment with the Employers and Affiliates prior to the Three-Year Anniversary Date by reason of death, then on the date of the Employee’s death the Award shall become nonforfeitable and the Restriction Period with respect to the Award shall terminate. Within sixty (60) days following the date of the Employee’s death, the Company shall issue to the Employee’s designated beneficiary in a single payment the shares of Common Stock subject to the Award.
(c) Disability. If the Employee separates from employment with the Employers and Affiliates prior to the Three-Year Anniversary Date by reason of Disability, then on the date of the Employee’s separation the Award shall become nonforfeitable and the Restriction Period with respect to the Award shall terminate. The Company shall issue the shares of Common Stock subject to the Award in a single payment within sixty (60) days following the date of the Employee’s separation. For purposes of this Award Agreement, “Disability” shall mean a total physical disability which, in the Committee’s judgment, prevents the Employee from performing substantially his or her employment duties and responsibilities for a continuous period of at least six months.
(d) Other Separation from Employment. If the Employee separates from employment with the Employers and Affiliates prior to the Three-Year Anniversary Date for any reason other than death or Disability (including if the Employee’s employment is separated by the Employers and Affiliates prior to the Three-Year Anniversary Date for Cause (as defined in the Letter Agreement between the Employee and the Company executed on July 25, 2013 and determined by the Company in its sole discretion)), then on the date of the Employee’s separation the Award shall be forfeited and shall be canceled by the Company.
(e) Forfeiture of Award and Award Gain upon Competition, Misappropriation, Solicitation or Disparagement. Notwithstanding any other provision herein, if the Employee engages in (i) Competition (as defined in this Section 2(e) below); (ii) Misappropriation (as defined in this Section 2(e) below); (iii) Solicitation (as defined in this Section 2(e) below) or (iv) Disparagement (as defined in this Section 2(e) below), in each case as determined by the Company in its sole discretion, then (i) on the date of such Competition, Misappropriation, Solicitation or Disparagement, the Award immediately shall be forfeited and shall be canceled by the Company and (ii) in the event that the Award became nonforfeitable within the twelve months immediately preceding such Competition, Misappropriation, Solicitation or Disparagement, the Employee shall pay the Company, within five business days of receipt by the Employee of a written demand therefore, an amount in cash determined by multiplying the number of shares of Common Stock subject to the Award (without reduction for any shares of Common Stock delivered by the Employee or withheld by the Company pursuant to Section 4.3) by the Fair Market Value of a share of Common Stock on the date that the Award became nonforfeitable. The Employee acknowledges and agrees that the Award, 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 the Employers or an Affiliate. The Employee acknowledges and agrees that this Section 2(e) is therefore fair and reasonable, and not a penalty.
The Employee may be released from the Employee’s obligations under this Section 2(e) only if and to the extent the Committee determines in its sole discretion that such release is in the best interests of the Company.
The Employee agrees that by executing this Award Agreement the Employee authorizes the Employers and any Affiliate to deduct any amount owed by the Employee pursuant to this Section 2(e) from any amount payable by the Employers or any Affiliate to the Employee, including, without limitation, any amount payable to the Employee as salary, wages, vacation pay or bonus. The Employee further agrees to execute any documents at the time of setoff required by the Employers and any Affiliate in order to effectuate the setoff. Should the Employee fail to do so and the Employers and/or any Affiliate institute a legal action against the Employee to recover the amounts due, the Employee agrees to reimburse the Employers and/or any Affiliate for their reasonable attorneys’ fees and litigation costs incurred in recovering such amounts from the Employee. 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 Employee shall not constitute a waiver of this right of setoff with respect to any other amount payable to the Employee or any other remedy.
For
purposes of this Award Agreement, “Competition” shall mean that the Employee,
directly or indirectly, individually or in conjunction with any Person, during
the Employee’s employment with the Employers and the Affiliates and for the
twelve months after the termination of that employment for any reason, other
than on any Employer’s or Affiliate’s behalf (i) has contact with any customer
of an Employer or Affiliate or with any prospective customer which has been
contacted or solicited by or on behalf of an Employer or Affiliate for the
purpose of soliciting or selling to such customer or prospective customer the
same or a similar (such that it could substitute for) product or service
provided by an Employer or Affiliate during the Employee’s employment with the
Employers and the Affiliates; or (ii) becomes employed in the business or
engages in the business of providing wireless, telephone, broadband or
information technology products or services in any county or county contiguous
to a county in which an Employer or Affiliate provided such products or
services during the Employee’s employment with the Employers and the Affiliates
or had plans to do so within the twelve month period immediately following the
Employee’s termination of employment.
For purposes of this Award Agreement, “Misappropriation” shall mean that the
Employee (i) uses Confidential Information (as defined below) for the benefit
of anyone other the Employers or an Affiliate, as the case may be, or discloses
the Confidential Information to anyone not authorized by the Employers or an
Affiliate, as the case may be, to receive such information; (ii) upon
termination of employment, makes any summaries of, takes any notes with respect
to or memorizes any Confidential Information or takes any Confidential
Information or reproductions thereof from the facilities of the Employers or an
Affiliate or (iii) upon termination of employment or upon the request of the
Employers or an Affiliate, fails to return all Confidential Information then in
the Employee’s possession. “Confidential information” shall mean any
confidential and proprietary drawings, reports, sales and training manuals,
customer lists, computer programs and other material embodying trade secrets or
confidential technical, business or financial information of the Employers or
an Affiliate.
For purposes of this Award Agreement, “Solicitation” shall mean that the
Employee, directly or indirectly, individually or in conjunction with any
Person, during the Employee’s employment with the Employers and the Affiliates
and for the twelve months after the termination of that employment for any reason,
other than on any Employer’s or Affiliate’s behalf, solicits, induces or
encourages (or attempts to solicit, induce or encourage) any individual away
from any Employer’s or Affiliate’s employ or from the faithful discharge of
such individual’s contractual and fiduciary obligations to serve the Employers’
and Affiliates’ interests with undivided loyalty.
For purposes of this Award Agreement, “Disparagement” shall mean that the
Employee has made a statement (whether oral, written, or electronic) to any
Person other than to an officer of an Employer or an Affiliate that disparages
or demeans the Employers, any Affiliate, or any of their respective owners,
directors, officers, employees, products or services.
3. Change in Control
(a) In General. Notwithstanding any provision in the Plan or any other provision of this Award Agreement, in the event of a Change in Control, the Board (as constituted prior to such Change in Control) may in its discretion, but shall not be required to, make such adjustments to the Award as it deems appropriate, including, without limitation: (i) causing the Award to become nonforfeitable in whole or in part; and/or (ii) to the extent permitted by section 409A of the Code (if applicable thereto), causing the Restriction Period with respect to the Award to lapse in full or in part and payment of the Award, to the extent the Restriction Period has lapsed, to occur within sixty (60) days following the occurrence of the Change in Control (the “Change in Control Payment Period”); and/or (iii) substituting for some or all of the shares of Common Stock subject to the Award the number and class of shares into which each outstanding share of Common Stock shall be converted pursuant to the Change in Control, with an appropriate and equitable adjustment to the Award as determined by the Committee in accordance with Section 4.5 below and/or (iv) to the extent permitted under section 409A of the Code (if applicable thereto), requiring that the Award, in whole or in part, be surrendered to the Company by the holder thereof and be immediately canceled by the Company and providing that the holder of the Award receive, within the Change in Control Payment Period, (X) a cash payment in an amount equal to the number of shares of Common Stock then subject to the portion of the Award surrendered, to the extent the Restriction Period on the Award has lapsed or will lapse pursuant to this Section 3(a), multiplied by the Fair Market Value of a share of Common Stock as of the date of the Change in Control; (Y) shares of capital stock of the corporation resulting from or succeeding to the business of the Company pursuant to the Change in Control, or a parent corporation thereof, having a fair market value not less than the amount determined under clause (X) above; or (Z) a combination of the payment of cash pursuant to clause (X) above and the issuance of shares pursuant to clause (Y) above.
(b) Definition of Change in Control. For purposes of the Plan and this Award Agreement, a "Change in Control" shall mean:
(1) the acquisition by any Person, including any "person" within the meaning of section 13(d)(3) or 14(d)(2) of the Exchange Act, of beneficial ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act, of the then outstanding securities of the Company (the “Outstanding Voting Securities”) (x) having sufficient voting power of all classes of capital stock of the Company to elect at least 50% or more of the members of the Board or (y) having 50% or more of the combined voting power of the Outstanding Voting Securities entitled to vote generally on matters (without regard to the election of directors), excluding, however, the following: (i) any acquisition directly from the Company or an Affiliate (excluding any acquisition resulting from the exercise of an exercise, conversion or exchange privilege, unless the security being so exercised, converted or exchanged was acquired directly from the Company or an Affiliate), (ii) any acquisition by the Company or an Affiliate, (iii) any acquisition by an employee benefit plan (or related trust) sponsored or maintained by the Company or an Affiliate, (iv) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (3) of this Section 3(b), or (v) any acquisition by the following Persons: (A) XxXxx X. Xxxxxxx or his spouse, (B) any child of XxXxx X. Xxxxxxx or the spouse of any such child, (C) any grandchild of XxXxx X. Xxxxxxx, including any child adopted by any child of XxXxx X. Xxxxxxx, or the spouse of any such grandchild, (D) the estate of any of the Persons described in clauses (A)-(C), (E) any trust or similar arrangement (including any acquisition on behalf of such trust or similar arrangement by the trustees or similar Persons) provided that all of the current beneficiaries of such trust or similar arrangement are Persons described in clauses (A)-(C) or their lineal descendants, or (F) the voting trust which expires on June 30, 2035, or any successor to such voting trust, including the trustees of such voting trust on behalf of such voting trust (all such Persons, collectively, the "Exempted Persons");
(2) individuals who, as of March 6, 2013, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of such Board; provided that any individual who becomes a director of the Company subsequent to March 6, 2013, and whose election or nomination for election by the Company's stockholders was approved by the vote of at least a majority of the directors then comprising the Incumbent Board, shall be deemed a member of the Incumbent Board; and provided further, that any individual who was initially elected as a director of the Company as a result of an actual or threatened solicitation by a Person other than the Board for the purpose of opposing a solicitation by any other Person with respect to the election or removal of directors, or any other actual or threatened solicitation of proxies or consents by or on behalf of any Person other than the Board shall not be deemed a member of the Incumbent Board;
(3) consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (a "Corporate Transaction"), excluding, however, a Corporate Transaction pursuant to which (i) all or substantially all of the Persons who are the beneficial owners of the Outstanding Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, (x) sufficient voting power to elect at least a majority of the members of the board of directors of the corporation resulting from the Corporate Transaction and (y) more than 50% of the combined voting power of the outstanding securities which are entitled to vote generally on matters (without regard to the election of directors) of the corporation resulting from such Corporate Transaction (including in each of clauses (x) and (y), without limitation, a corporation which as a result of such transaction owns, either directly or indirectly, the Company or all or substantially all of the Company's assets), in substantially the same proportions relative to each other as the shares of Outstanding Voting Securities are owned immediately prior to such Corporate Transaction, (ii) no Person (other than the following Persons: (v) the Company or an Affiliate, (w) any employee benefit plan (or related trust) sponsored or maintained by the Company or an Affiliate, (x) the corporation resulting from such Corporate Transaction, (y) the Exempted Persons, and (z) any Person which beneficially owned, immediately prior to such Corporate Transaction, directly or indirectly, 50% or more of the Outstanding Voting Securities) will beneficially own, directly or indirectly, 50% or more of the combined voting power of the outstanding securities of such corporation entitled to vote generally on matters (without regard to the election of directors) and (iii) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; or
(4) approval by the stockholders of the Company of a plan of complete liquidation or dissolution of the Company.
4. Additional Terms and Conditions of Award
4.1. Transferability of Award. Except pursuant to a beneficiary designation effective on the Employee's death, the Award may not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process. Upon any attempt to so sell, transfer, assign, pledge, hypothecate, encumber or otherwise dispose of the Award, the Award and all rights hereunder shall immediately become null and void.
By accepting the Award, the Employee agrees that if all beneficiaries designated on a form prescribed by the Company predecease the Employee or, in the case of corporations, partnerships, trusts or other entities which are designated beneficiaries, are terminated, dissolved, become insolvent or are adjudicated bankrupt prior to the date of the Employee’s death, or if the Employee fails to properly designate a beneficiary on a form prescribed by the Company, then the Employee hereby designates the following Persons in the order set forth herein as the Employee’s beneficiary or beneficiaries: (i) the Employee’s spouse, if living, or if none, (ii) the Employee’s then living descendants, per stirpes, or if none, (iii) the Employee’s estate.
4.2. Investment Representation. The Employee hereby represents and covenants that (a) any shares of Common Stock acquired upon the lapse of restrictions with respect to the Award will be acquired for investment and not with a view to the distribution thereof within the meaning of the Securities Act of 1933, as amended (the "Securities Act"), unless such acquisition has been registered under the Securities Act and any applicable state securities laws; (b) any subsequent sale of any such shares shall be made either pursuant to an effective registration statement under the Securities Act and any applicable state securities laws, or pursuant to an exemption from registration under the Securities Act and such state securities laws; and (c) if requested by the Company, the Employee shall submit a written statement, in a form satisfactory to the Company, to the effect that such representation is true and correct as of the date of acquisition of any shares hereunder or is true and correct as of the date of sale of any such shares, as applicable. As a condition precedent to the issuance or delivery to the Employee of any shares subject to the Award, the Employee shall comply with all regulations and requirements of any regulatory authority having control of or supervision over the issuance or delivery of the shares and, in connection therewith, shall execute any documents which the Committee shall in its sole discretion deem necessary or advisable.
4.3. Tax Withholding. The Employee timely shall pay to the Company such amount as the Company may be required, under all applicable federal, state, local or other laws or regulations, to withhold and pay over as income or other withholding taxes (the "Required Tax Payments") with respect to the Award. The Employee may elect to satisfy his or her obligation to advance the Required Tax Payments by (a) authorizing the Company to withhold whole shares of Common Stock which otherwise would be delivered to the Employee pursuant to the Award, having an aggregate Fair Market Value determined as of the date the obligation to withhold or pay taxes arises in connection with the Award or (b) delivery (either actual delivery or by attestation procedures established by the Company) to the Company of previously-owned whole shares of Common Stock, having an aggregate Fair Market Value determined as of the date the obligation to withhold or pay taxes arises in connection with the Award. Shares of Common Stock to be withheld or delivered may not have an aggregate Fair Market Value in excess of the amount determined by applying the minimum statutory withholding rate. Any fraction of a share of Common Stock which would be required to pay the Required Tax Payments shall be disregarded and the remaining amount due shall be paid in cash by the Employee.
4.4. Award Confers No Rights as a Stockholder. The Employee shall not be entitled to any privileges of ownership with respect to the shares of Common Stock subject to the Award unless and until the restrictions on the Award lapse and the Employee becomes a stockholder of record with respect to such shares.
4.5. Adjustment. In the event of any equity restructuring (within the meaning of Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation—Stock Compensation) that causes the per share value of shares of Common Stock to change, such as a stock dividend, stock split, spinoff, rights offering or recapitalization through an extraordinary dividend, the number and class of shares of Common Stock subject to the Award shall be appropriately and equitably adjusted by the Committee. In the event of any other change in corporate capitalization, including a merger, consolidation, reorganization or partial or complete liquidation of the Company, such adjustment described in the foregoing sentence may be made as determined to be appropriate and equitable by the Committee to prevent dilution or enlargement of rights of participants. In either case, such adjustment shall be final, binding and conclusive. If such adjustment would result in a fractional share being subject to the Award, the Company shall pay the holder of the Award, on the date that the shares with respect to the Award are issued, an amount in cash determined by multiplying (i) the fraction of such share (rounded to the nearest hundredth) by (ii) the Fair Market Value of a share on the date that the Restriction Period with respect to the Award terminates.
4.6. Compliance with Applicable Law. The Award is subject to the condition that if the listing, registration or qualification of the shares of Common Stock subject to the Award upon any securities exchange or under any law, the consent or approval of any governmental body or the taking of any other action is necessary or desirable as a condition of, or in connection with, the delivery of shares, such shares will not be delivered unless such listing, registration, qualification, consent, approval or other action shall have been effected or obtained, free of any conditions not acceptable to the Company. The Company agrees to use reasonable efforts to effect or obtain any such listing, registration, qualification, consent, approval or other action.
4.7. Delivery of Shares. On the date of payment of the Award, the Company shall deliver or cause to be delivered to the Employee the shares of Common Stock subject to the Award. The Company may require that the shares of Common Stock delivered pursuant to the Award bear a legend indicating that the sale, transfer or other disposition thereof by the Employee is prohibited except in compliance with the Securities Act of 1933, as amended, and the rules and regulations thereunder. The holder of the Award shall pay all original issue or transfer taxes and all fees and expenses incident to such delivery, unless the Company in its discretion elects to make such payment.
4.8. Award Confers No Rights to Continued Employment or Service. In no event shall the granting of the Award or the acceptance of this Award Agreement and the Award by the Employee give or be deemed to give the Employee any right to continued employment by or service with the Company or any of its subsidiaries or affiliates.
4.9. Decisions of Committee. The Committee shall have the right to resolve all questions which may arise in connection with the Award. Any interpretation, determination or other action made or taken by the Committee regarding the Plan or this Award Agreement shall be final, binding and conclusive.
4.10. Company to Reserve Shares. The Company shall at all times prior to the cancellation of the Award reserve and keep available, either in its treasury or out of its authorized but unissued shares of Common Stock, the full number of shares subject to the Award from time to time.
4.11. Award Agreement Subject to the Plan. This Award Agreement is subject to the provisions of the Plan, as it may be amended from time to time, and shall be interpreted in accordance therewith. The Employee hereby acknowledges receipt of a copy of the Plan.
4.12. Award Subject to Clawback. The Award and any shares of Common Stock delivered pursuant to the Award are subject to forfeiture, recovery by the Company or other action pursuant to any clawback or recoupment policy which the Company may adopt from time to time, including without limitation any such policy which the Company may be required to adopt under the Xxxx-Xxxxx Xxxx Street Reform and Consumer Protection Act and implementing rules and regulations thereunder, or as otherwise required by law.
5. Miscellaneous Provisions
5.1. Successors. This Award Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any Person or Persons who shall, upon the death of the Employee, acquire any rights hereunder.
5.2. Notices. All notices, requests or other communications provided for in this Award Agreement shall be made in writing either (a) by actual delivery to the party entitled thereto, (b) by mailing in the United States mails to the last known address of the party entitled thereto, via certified or registered mail, postage prepaid and return receipt requested, (c) by electronic mail, utilizing notice of undelivered electronic mail features or (d) by telecopy with confirmation of receipt. The notice, request or other communication shall be deemed to be received (a) in case of delivery, on the date of its actual receipt by the party entitled thereto, (b) in case of mailing by certified or registered mail, five days following the date of such mailing, (c) in case of electronic mail, on the date of mailing but only if a notice of undelivered electronic mail is not received or (d) in case of telecopy, on the date of confirmation of receipt.
5.3. Governing Law. The Award, this Award Agreement and all determinations made and actions taken pursuant thereto, to the extent otherwise not governed by the Code or the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to principles of conflicts of laws.
5.4. Compliance with Section 409A of the Code. It is intended that this Award Agreement and the Plan be exempt from the requirements of section 409A of the Code to the maximum extent possible. To the extent section 409A of the Code applies to this Award Agreement and the Plan, it is intended that this Award Agreement and the Plan comply with the requirements of section 409A of the Code to the maximum extent possible. This Award Agreement and the Plan shall be administered and interpreted in a manner consistent with this intent. In the event that this Award Agreement or the Plan does not comply with section 409A of the Code (to the extent applicable thereto), the Company shall have the authority to amend the terms of this Award Agreement or the Plan (which amendment may be retroactive to the extent permitted by section 409A of the Code and may be made by the Company without the consent of the Employee) to avoid taxes and other penalties under section 409A of the Code, to the extent possible. Notwithstanding the foregoing, no particular tax result for the Employee with respect to any income recognized by the Employee in connection with this Award Agreement is guaranteed, and the Employee solely shall be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Employee under section 409A of the Code in connection with this Award Agreement.
5.5. Counterparts. This Award Agreement may be executed in two counterparts each of which shall be deemed an original and both of which together shall constitute one and the same instrument.
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UNITED STATES CELLULAR CORPORATION |
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By: |
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XxXxx X. Xxxxxxx, Xx. |
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Chairman |
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Accepted this ___ day of |
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___________, 20__. |
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Xxxxxxx X. Xxxxxx |
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