JCPenney 2015 Annual Report Download - page 145

Expiration Date
Unless the right to purchase shares of Common Stock under this Non-
Qualified Stock Option expires sooner, as described in the Post-
Separation Exercise Period table, below, this Non-Qualified Stock
Option shall expire and all rights to purchase shares of Common
Stock hereunder shall cease on the tenth anniversary of the Date of
Grant
Exercise of Non-Qualified Stock Options and Issuance of Shares
of Common Stock
Exercise. Your Non-Qualified Stock Option may be exercised only by
delivery to the Company, or its designee, of notice, in such form as
shall be permitted by the Company or its designee, stating the number
of shares of Common Stock being purchased, the method of payment,
and such other matters as may be considered appropriate by the
Company in connection with the issuance of shares of Non-Qualified
Stock Option upon exercise of your Non-Qualified Stock Option,
together with payment in full of the Exercise Price for the number of
shares of Common Stock being purchased. The effective date of
exercise of a Non-Qualified Stock Option (which in no event, may be
beyond the expiration date of the Non-Qualified Stock Option) shall be
(i) in connection with a sell order for the underlying stock that is a
“Sell-to-Cover Order,” a “Same-Day-Sale Exercise Order,” a Limit
Order, a “Good-till” Cancelled Order or the like, the date on which such
sell order is actually executed, or (ii) in connection with an “Exercise
and Hold” (cash exercise) transaction, the date the requisite funds are
received by the Company at its home office in Plano, Texas or such
other location as the Company may designate, or by a third party duly
designated by the Company at the offices of such third party, in the
manner determined by the Chief Executive Officer or the Chief Talent
Officer, or their respective successors by title or office; provided,
however, that if the date of exercise, as otherwise determined above
is not a Trading Date, the date of exercise shall be deemed to be the
next Trading Date. Further, an exercise instruction received after the
close of the NYSE on a particular day it shall be deemed received as
of the opening of the next Trading Date
Payment. Payment equal to the aggregate Exercise Price for the
shares subject to your Non-Qualified Stock Option and for which
notice of exercise has been provided by You to the Company, along
with any applicable withholding taxes as described herein, shall be
tendered in full, with the notice of exercise, in cash (by check) or by (i)
the actual or constructive transfer to the Company of non-forfeitable,
non-restricted shares of Common Stock that have been owned by You
for more than six months prior to the date of exercise; (ii) using the
net proceeds (after paying all selling fees) from the sale of some (the
“Sell-to-Cover Exercise Method”) or all (the “Same-Day-Sale Exercise
Method”), of the shares of Common Stock received on the exercise of
the Non-Qualified Stock Option, or from any arrangement pursuant to
which You irrevocably instructs a broker-dealer to sell a sufficient
portion of such shares to pay the Exercise Price, along with any
applicable withholding taxes described herein, and related fees
thereon and deliver the sale proceeds directly to the Company; (iii)
through a “margin” commitment whereby You elect to exercise the
Non-Qualified Stock Option and to pledge the shares of Common
Stock so purchased to the NASD Dealer in a margin account as
security for a loan from the NASD Dealer in the amount of the
Exercise Price, and whereby the NASD Dealer commits upon receipt
of such shares of Common Stock to forward the Exercise Price
directly to the Company; (iv) by surrender for cancellation of shares of
Common Stock at the Fair Market Value per share at the time of
exercise under a “net exercise” arrangement; provided, however, that
use of a “net exercise” arrangement cannot result in the Non-Qualified
Stock Option being settled either in whole or in part for cash payable
to the Associate Participant; (v) in accordance with such other
procedures or in such other forms as the Company shall from time to
time determine; or (vi) any combination of the above, each as may
from time to time be permitted by the Company in its sole discretion.
In connection with the Sell-to-Cover Exercise Method or the Same-
Day-Sale Exercise Method the value of the shares of Common Stock
used in payment of the Exercise Price shall be the price at which the
Common Stock was sold by the broker-dealer functioning under the