Exhibit 10.1
BEST BUY CO., INC.
NON-QUALIFIED STOCK OPTION AND PERFORMANCE SHARE AWARD AGREEMENT
[Award Date:
October 11, 2004]
I.
THE AWARD.
AS OF THE AWARD DATE SET FORTH IN THE AWARD
NOTIFICATION ACCOMPANYING THIS AWARD, BEST BUY CO., INC. GRANTS TO YOU (I) THE
NUMBER OF PERFORMANCE SHARES OF BEST BUY COMMON STOCK SET FORTH IN SUCH AWARD
NOTIFICATION (THE "PERFORMANCE SHARES") AND (II) AN OPTION TO PURCHASE THE
NUMBER OF SHARES OF BEST BUY COMMON STOCK SET FORTH IN SUCH AWARD NOTIFICATION
(THE "OPTION") AT THE OPTION PRICE PER SHARE SET FORTH IN SUCH AWARD
NOTIFICATION, ON THE TERMS AND CONDITIONS CONTAINED IN THIS NON-QUALIFIED STOCK
OPTION AND PERFORMANCE SHARE AWARD AGREEMENT (THIS "AGREEMENT") AND THE BEST BUY
CO., INC. 2004 OMNIBUS STOCK AND INCENTIVE PLAN (THE "PLAN").
CAPITALIZED TERMS
NOT DEFINED IN THE BODY OF THIS AGREEMENT ARE DEFINED IN THE ADDENDUM.
II.
OPTION
2.1
DURATION AND EXERCISABILITY OF OPTION.
YOU MAY NOT
EXERCISE ANY PORTION OF THE OPTION PRIOR TO ONE YEAR FROM THE AWARD DATE, AND
THE OPTION EXPIRES 10 YEARS AFTER THE AWARD DATE (THE "EXPIRATION DATE").
YOU
MAY EXERCISE THE OPTION IN CUMULATIVE INSTALLMENTS OF 25% ON AND AFTER EACH OF
THE FIRST FOUR ANNIVERSARIES OF THE AWARD DATE.
THE ENTIRE OPTION WILL VEST
EARLIER AND BECOME EXERCISABLE UPON YOUR QUALIFIED RETIREMENT, DISABILITY OR
DEATH OR IF YOUR EMPLOYMENT IS TERMINATED WITHOUT CAUSE OR YOU TERMINATE YOUR
EMPLOYMENT FOR GOOD REASON WITHIN 12 MONTHS FOLLOWING A CHANGE OF CONTROL.
THE
OPTION MAY ONLY BE EXERCISED BY YOU DURING YOUR LIFETIME, AND MAY NOT BE
ASSIGNED OR TRANSFERRED OTHER THAN BY WILL OR THE LAWS OF DESCENT AND
DISTRIBUTION.
2.2
EXERCISE AND TAX WITHHOLDING.
THE OPTION MAY BE EXERCISED
IN WHOLE OR IN PART BY NOTICE TO BEST BUY (THROUGH THE PLAN ADMINISTRATOR OR
OTHER MEANS AS SHALL BE SPECIFIED BY BEST BUY FROM TIME-TO-TIME) STATING THE
NUMBER OF SHARES TO BE PURCHASED UNDER THE OPTION AND THE METHOD OF PAYMENT.
THE NOTICE MUST BE ACCOMPANIED BY PAYMENT IN FULL OF THE EXERCISE PRICE FOR ALL
SHARES DESIGNATED IN THE NOTICE.
PAYMENT OF THE EXERCISE PRICE MAY BE MADE BY
CASH, CHECK OR DELIVERY OF PREVIOUSLY OWNED SHARES OF STOCK HAVING A FAIR MARKET
VALUE (AS DEFINED IN THE PLAN) ON THE DATE OF EXERCISE EQUAL TO THE EXERCISE
PRICE. THE OPTION WILL NOT BE ELIGIBLE FOR TREATMENT AS A QUALIFIED OR INCENTIVE
STOCK OPTION FOR FEDERAL INCOME TAX PURPOSES.
YOU ARE LIABLE FOR ANY FEDERAL
AND STATE INCOME OR OTHER TAXES APPLICABLE UPON THE GRANT OR EXERCISE OF THE
OPTION OR THE DISPOSITION OF THE UNDERLYING SHARES, AND YOU ACKNOWLEDGE THAT YOU
SHOULD CONSULT WITH YOUR OWN TAX ADVISOR REGARDING THE APPLICABLE TAX
CONSEQUENCES.
UPON EXERCISE OF THE OPTION, BEST BUY WILL WITHHOLD FROM THE
SHARES THAT WOULD OTHERWISE BE DELIVERED TO YOU A NUMBER OF SHARES HAVING A FAIR
MARKET VALUE EQUAL TO THE AMOUNT OF ALL APPLICABLE TAXES REQUIRED BY BEST BUY TO
BE WITHHELD OR COLLECTED UPON THE EXERCISE OF