EXHIBIT 10.1
Form of
United Parcel Service, Inc.
Incentive Compensation Plan
Long-Term Incentive Awards
Nonqualified Stock Option Award Agreement
(Not Transferable)
THIS AGREEMENT evidences the grant by UNITED PARCEL SERVICE, INC., a Delaware
corporation (the "Company") in accordance with the Company's Incentive
Compensation Plan (the "Plan"), of a nonqualified stock option ("Option") to the
employee named below ("Employee"). This Option entitles Employee to purchase
from the Company the number of shares of the Company's class A Common Stock
("Shares") set forth below upon satisfaction of the vesting requirements and
payment of the exercise price per Share ("Option Price"), in each case, as set
forth below. This Option is granted effective as of the date set forth below
("Grant Date ") and is subject to all of the terms and conditions set forth
below.
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Employee: ((Employee))
Number of Shares: ((Number))
Option Price: ((Option))
Grant Date: [insert date]
Earliest Exercise Date: [five years from grant date]
Latest Exercise Date: [ten years from grant date]
ATTEST: UNITED PARCEL SERVICE, INC.
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Secretary Chairman and Chief Executive Officer
Terms and Conditions
1. Plan. This Option is subject to all of the terms and conditions set forth
herein and in the Plan, as the same may be amended from time to time, which
is herein incorporated by reference; provided, however, that if a term of
the Plan would cause this Option to be subject to Section 409A of the Code,
such term is not incorporated by reference. Terms not defined in this
agreement are defined in the Plan. If any term or condition in this Option
is inconsistent with the Plan, the Plan shall control. By accepting this
Option, the Employee unconditionally agrees to be bound by the applicable
terms, conditions and provisions of the Plan and this Award. The grant of
an Option in any year does not entitle an individual to an Option in any
subsequent year.
2. Vesting.
a. General Rule. The Option will vest and become exercisable on the
Earliest Exercise Date; provided that you are employed by the Company
or a Subsidiary on that date.
b. Death, Disability or Retirement. If your employment terminates by
reason of your death, disability (as defined in the Plan) or retirement
(as defined in the Plan) before the Earliest Exercise Date, the Option
will immediately vest.
c. Termination for Reasons Other than Death, Disability or Retirement. You
will forfeit any right to exercise any outstanding non-vested Option if
you terminate employment before the Earliest Exercise Date other than
by reason of your death, disability or retirement. Your vested Option
(if any) must be exercised within 90 calendar days of termination and
will expire at 4:00 p.m. New York Time on the 90th calendar day
following the date your employment terminates. The forfeited Option
will not be restored even if you return to employment with the Company
or a Subsidiary before the Earliest Exercise Date.
3. Exercise. You may exercise your Option at any time (subject to the UPS
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Guidelines) between the Earliest Exercise Date and the
Latest Exercise Date (unless your Option terminates earlier as a result of
termination of employment). You may partially exercise your Option if the
number of Shares you purchase is at least 500 or, if less, all the Shares
remaining unexercised under the Option. Payment may be made in cash or in
Shares that you own (the Shares must have been held by you for over six
months and not encumbered and, if acquired by exercise of an ISO, must have
been held by you for over one year), or a combination of cash and Shares.
We will withhold shares to pay the taxes due upon the exercise of your
Option.
4. Expiration. This Option will expire immediately at 4:00 p.m. New York Time
on the Latest Exercise Date.
5. Nontransferable. This Option is not transferable except by will or the laws
of descent and distribution.
