Exhibit 10y-1
"FORM"
EXECUTIVE SEVERANCE AGREEMENT
THIS AGREEMENT is made and entered into as of the ____ day of
______________, 20____, by and between BellSouth Corporation, a Georgia
corporation (the "Company"), and [ NAME ] (the "Executive").
Reasons for This Agreement. The Company recognizes the valuable
services that the Executive has rendered and continues to render to the Company
and its Affiliated Companies. On behalf of itself, its Affiliated Companies and
its shareholders, the Company desires to encourage the Executive's continued
service and dedication in the performance of the Executive's duties, and
attention to the business and affairs of the Company and its Affiliated
Companies, notwithstanding the possibility, threat or occurrence of a change in
control. The Company believes that it is in the best interests of the Company
and its shareholders to minimize the distractions, risks and uncertainties for
the Executive which may be expected to arise in connection with a change in
control by providing assurances to the Executive that the Executive will not be
materially disadvantaged by a change in control.
Agreement. In consideration of the Executive's continued service to the
Company, the covenants and agreements contained in this Agreement, and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Executive and the Company agree as follows:
I. Definitions.
For purposes of this Agreement, the following terms shall have the
meanings specified below:
(a) "Affiliated Companies" shall mean all of the Company's
subsidiaries, divisions, and other affiliated companies or entities.
(b) "Cause" shall mean the Executive's willfully engaging in conduct
that is demonstrably and materially injurious to the Company. For purposes of
this subsection I(b), no act, or failure to act, on the part of the Executive
shall be deemed "willful" unless committed by the Executive in bad faith and
without reasonable belief that such action or omission was in the best interest
of the Company. Notwithstanding the foregoing, the Executive shall not be deemed
to have been terminated for Cause unless and until there shall have been
delivered to the Executive a certificate of a resolution duly adopted by the
affirmative vote of not less than seventy-five percent (75%) of the entire
membership of the Board of Directors of the Company, at a meeting of the Board
(after reasonable notice to the Executive and an opportunity for the Executive,
together with the Executive's legal counsel, to be heard before the Board),
finding that in the good faith opinion of the Board, the Executive has engaged
in the conduct set forth in this subsection I(b) and specifying the particulars
thereof in detail.
(c) "Change in Control" shall mean:
(i) any "person" (as such term is defined in the Securities
Exchange Act of 1934, as amended), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the
Company (or of another entity owned directly or indirectly by the
shareholders of the Company in substantially the same proportions as
their ownership of stock of the Company), becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding
voting securities;
(ii) during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of Directors
of the Company and any new director whose election by the Board of
Directors or nomination for election by the Company's shareholders was
approved by a vote of at least two-thirds of the directors who either
were directors at the beginning of the two year period or whose
election or nomination for election was previously so approved, cease
for any reason to constitute a majority thereof;
(iii) the consummation of a merger, plan of reorganization,
consolidation, share exchange, or other transaction, in one or a series
of related transactions, involving the Company, if immediately
following such merger, plan of reorganization, consolidation, share
exchange, or other transaction or transactions the holders of the
voting securities of the Company outstanding immediately prior thereto
hold securities representing seventy percent (70%) or less of the
combined voting power represented by the voting securities of the
Company or such surviving entity outstanding immediately after such
merger, plan of reorganization, consolidation, share exchange, or other
transaction or transactions;
(iv) the consummation of a transaction involving the sale or
other disposition by the Company or one or more of its Subsidiaries, in
one or a series of related transactions, of interests in an entity or
entities, or of assets, which for the most recent audited twelve-month
period produced total operating revenues or net income aggregating more
than thirty percent (30%) of the total operating revenues or net income
of the Company and its Subsidiaries (taken as a whole), if following
such transaction or transactions, any such entity is no longer a
Subsidiary or such assets are no longer held by a Subsidiary;
(v) the complete liquidation or dissolution of the Company or
the sale of all or substantially all of the assets of the Company; or
(vi) the consummation of any other transaction which a
majority of the Board of Directors of the Company, in its sole and
absolute discretion, shall determine constitutes a Change in Control.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(e) "Confidential Information" shall mean information, whether
generated internally or externally, relating to the Company's business or to the
Affiliated Companies' businesses which derives economic value, actual or
potential, from not being generally known to other persons and is the subject of
efforts that are reasonable under the circumstances to maintain its secrecy or
confidentiality, including, but not limited to, studies and analyses, technical
or nontechnical data, programs, patterns, compilations, devices, methods, models
(including cost and /or pricing models and operating models), techniques,
drawings, processes, employee compensation data, financial data (including
marketing information and strategies and personnel data), lists of actual or
potential customers or suppliers, and information relating to regulatory and
business policies, plans, and strategies. For purposes of this Agreement,
Confidential Information does not include information which is not a trade
secret three (3) years after termination of Executive's employment with Company.
(f) "Disability" shall mean an illness, injury or other incapacity
which qualifies the Executive for long-term disability benefits under the
principal management long-term disability plan of the Executive's employer.
(g) "Excise Tax" shall have the meaning ascribed to such term in
subsection VII(a) of this Agreement.
(h) "Good Reason" shall mean the occurrence after a Change in Control,
without the Executive's express written consent, of any of the following
circumstances:
(i) the assignment to the Executive of duties inconsistent
with the Executive's status or responsibilities as in effect
immediately prior to a Change in Control, including imposition of
business travel obligations which differ materially from business
travel obligations immediately prior to the Change in Control;
(ii) diminution in the status or responsibilities of the
Executive's position from that which existed immediately prior to the
Change in Control, whether by reason of the Company ceasing to be a
public company, becoming a subsidiary of a successor public company, or
otherwise;
(iii) a reduction in the Executive's annual base salary as in
effect immediately before the Change in Control or the failure to pay a
bonus award to which the Executive is otherwise entitled under any of
the short-term or long-term incentive plans in which the Executive
participates (or any successor incentive compensation plans) at the
time such awards are usually paid;
(iv) a change in the principal place of the Executive's
employment, as in effect immediately prior to the Change in Control, to
a location more than thirty-five (35) miles distant from the location
of such principal place at such time;
(v) the failure by the Company to continue in effect any
bonus, incentive compensation, or stock option plan in which the
Executive participates immediately prior to the Change in Control,
unless an equivalent alternative compensation arrangement (embodied in
an ongoing substitute or alternative plan) has been provided to the
Executive, or the failure by the Company to continue the Executive's
participation in any such bonus, incentive compensation or stock option
plan on substantially the same basis, both in terms of the amount of
benefits provided and the level of the Executive's participation
relative to other participants, as existed immediately prior to the
time of the Change in Control;
(vi) (A) except as required by law, the failure by the Company
to continue to provide to the Executive benefits substantially
equivalent, in the aggregate, to those enjoyed by the Executive under
the qualified and nonqualified employee pension and welfare benefit
plans of the Company, including, without limitation, any pension, life
insurance, medical, dental, health and accident, disability, retirement
or savings plans in which the Executive was eligible to participate
immediately prior to the Change in Control; (B) the taking of any
action by the Company which would directly or indirectly materially
reduce or deprive the Executive of the perquisites enjoyed by the
Executive immediately prior to the Change in Control (including
Company-paid and/or reimbursed club memberships, financial counseling
fees and the like); or (C) the failure by the Company or a successor to
provide the Executive with the number of paid vacation days (and the
policies and practices for taking such days) as was provided under the
Company's vacation policy or practice as was in effect immediately
prior to the Change in Control;
(vii) the failure of the Company or any successor to obtain a
satisfactory written agreement from any successor to assume and agree
to perform this Agreement, as contemplated in subsection IX(a); or
(viii) any purported termination of the Executive's employment
that is not effected pursuant to a Notice of Termination satisfying the
requirements of subsection II(b). For purposes of this Agreement, no
such purported termination shall be effective except as constituting
Good Reason.
The Executive's continued employment shall not constitute consent to,
or a waiver of rights with respect to, any circumstances constituting Good
Reason hereunder.
(i) "Gross-Up Payment" shall have the meaning ascribed to such term in
subsection VII(a) of this Agreement.
(j) "Notice of Termination" shall have the meaning ascribed to such
term in subsection II(b) of this Agreement.
(k) "Payments" shall have the meaning ascribed to such term in
subsection VII(a) of this Agreement.
(l) "Potential Change in Control" shall mean:
(i) the Company (or an Affiliated Company) enters into an
agreement, the consummation of which would result in the occurrence of
a Change in Control;
(ii) an individual or entity, or a group or groups of
individuals or entities, acquires rights, whether pursuant to an
agreement with the Company (or an Affiliated Company) or otherwise, the
exercise of which would result in the occurrence of a Change in
Control;
(iii) an individual or entity (including the Company), or a
group or groups of individuals or entities, publicly announces an
intention to take or to consider taking action(s) which, if taken,
would result in the occurrence of a Change in Control; or
(iv) the Board of Directors of the Company adopts a resolution
to the effect that, for purposes of this Agreement, a Potential Change
in Control has occurred.
(m) "Retirement" shall mean the Executive's voluntary termination of
employment with the Company, other than for Good Reason, and in accordance with
the Company's retirement policy generally applicable to its employees or in
accordance with any outstanding or contemporaneous retirement arrangement
established with respect to the Executive.
(n) "Subsidiary" shall mean any corporation of which fifty percent
(50%) or more of the total combined voting power of all classes of stock is
owned directly or indirectly by the Company and any joint venture, partnership
or limited liability company (or other similar entity) of which fifty percent
(50%) or more of the capital or profits interest is owned directly or indirectly
by the Company.
(o) "Tax Counsel" shall have the meaning ascribed to such term in
subsection VII(b) of this Agreement.
(p) "Termination" shall have the meaning ascribed to such term in
subsection II(a) of this Agreement.
(q) "Termination Date" shall mean:
(i) if the Executive's employment is terminated for
Disability, thirty (30) days after Notice of Termination is given
(provided that the Executive shall not have returned to the full-time
performance of his duties during such thirty (30) day period); and
(ii) if the Executive's employment is terminated for Cause or
Good Reason or for any reason other than death or Disability, the date
specified in the Notice of Termination (which in the case of a
termination for Cause shall not be less than thirty (30) days and in
the case of a termination for Good Reason shall not be less than thirty
(30) days nor more than sixty (60) days, respectively, from the date
such Notice of Termination is given).
(r) "Tier I Officer" shall mean the chief executive officer of the
Company, the Company's senior strategic planning officer, the Company's senior
mergers and acquisitions officer, the chief financial officer of the Company,
the chief legal officer of the Company, and any other officer of the Company or
of a Subsidiary, elected by the Company's Board of Directors, who is assigned to
the Company's officer compensation Band A (or successor compensation level) or
any higher officer compensation band or level.
(s) "Tier II Officer" shall mean any officer of the Company or of a
Subsidiary, elected by the Company's Board of Directors, who is assigned to the
Company's officer compensation Band B (or successor compensation level), or who
is otherwise identified by Company's Board of Directors (or a Committee thereof)
as a Tier II Officer, and who is not described in subsection I(r).
(t) "Tier IIA Officer" shall mean any officer of the Company or of a
Subsidiary, elected by the Company's Board of Directors, who is assigned to the
Company's officer compensation Band BB (or successor compensation level) and who
is not described in subsection I (r).
II. Termination of Employment Following Change in Control.
(a) Entitlement to Benefits. If at the time a Change in Control occurs
the Executive is either a Tier I Officer or a Tier II Officer or a Tier IIA
Officer, the Executive shall be entitled to the benefits provided in Section III
hereof upon the subsequent termination of his employment with the Company (or
its successor) within two (2) years after the occurrence of the Change in
Control, unless such termination is (i) a result of the Executive's death or
Retirement, (ii) for Cause, (iii) a result of the Executive's Disability, or
(iv) by the Executive other than for Good Reason. Such termination of the
Executive's employment which is not as a result of the Executive's death,
Retirement or Disability and (x) if by the Company, is not for Cause, or (y) if
by the Executive, is for Good Reason, shall be referred to hereinafter as a
"Termination."
If, within two (2) years after the occurrence of a Change in Control,
such Executive's employment shall be terminated for Cause or by the Executive
for other than Good Reason, the Company shall pay the Executive his full base
salary through the Termination Date at the rate in effect at the time Notice of
Termination is given and shall pay any amounts to be paid to the Executive
pursuant to any other compensation plans, programs or employment agreements then
in effect, and the Company shall have no further obligations to the Executive
under this Agreement.
(b) Notice of Termination. Any termination of the Executive's
employment, within two (2) years after the occurrence of a Change in Control, by
the Company or by the Executive, shall be communicated by written Notice of
Termination to the other party hereto. For purposes of this Agreement, a "Notice
of Termination" shall mean a notice which shall indicate the specific provision
of this Agreement relied upon and shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated.
(c) Potential Change in Control. If, after a Potential Change in
Control has occurred, the Executive's employment with the Company or a
Subsidiary employing the Executive is terminated under circumstances which would
constitute a Termination if a Change in Control had occurred, and such
termination was at the request of a party who has taken steps to effect a Change
in Control or who is otherwise involved in the Potential Change in Control, or
was otherwise caused by the Potential Change in Control, then for all purposes
of this Agreement, (i) a Change in Control shall be deemed to have occurred at
the time such Potential Change in Control occurred, and (ii) such termination
shall be deemed to have been a Termination (if such termination would have
constituted a Termination had it followed an actual Change in Control).
Notwithstanding the foregoing, the two (2) year period described in the first
sentence of subsection II(a) of the Agreement shall not commence upon any such
deemed Change in Control.
III. Compensation Upon Termination of Employment Following Change in
Control.
Upon a Termination of the Executive's employment, the Executive shall
be entitled to the following benefits:
(a) Severance Payment. The Company shall pay to the Executive as a
severance allowance, no later than the seventh (7th) day following the
Termination Date, a lump sum cash payment equal to the applicable percentage of
the sum of (1) the Executive's Base Salary in effect immediately before the
Change in Control plus (2) the amount of the standard award applicable to the
Executive under the BellSouth Corporation Officer Short Term Incentive Award
Plan, or successor short term incentive plan ("STIP"), for the Award Year in
which the Change in Control occurs. The "applicable percentage" as used in the
preceding sentence shall be (i) 300%, if immediately before the Change in
Control the Executive was a Tier I Officer, (ii) 200%, if immediately before the
Change in Control the Executive was a Tier II Officer and (iii)
250%, if immediately before the Change in Control the Executive was a Tier IIA
Officer.
For purposes of this Section III, (A) the term "Base Salary"
shall refer to the gross annual base salary payable to the Executive including
the amount of any before-tax and after-tax contributions made by the Executive
from such salary to or under any Code Section 125 plan, to or under any Code
Section 401(k) plan, such as the BellSouth Retirement Savings Plan or other
plan(s) sponsored by the Company or an Affiliated Company, or a successor to any
such plan, and the amount of any other deferrals of such salary under any
nonqualified deferred compensation plans or arrangements maintained by the
Company or an Affiliated Company, and (B) the terms "Standard Award" and "Award
Year" shall have the meanings ascribed to such terms under STIP, or comparable
terms used in any successor plan.
(b) Short Term Award. The Company shall pay the Executive, no later
than the seventh (7th) day following the Termination Date, a lump sum cash
payment equal to the amount of the Standard Award applicable to the Executive
under STIP for the Award Year in which the Termination occurs, multiplied by the
greater of (i) one hundred percent (100%), or (ii) the percentage which would be
payable under STIP based on actual performance results as of the most recently
completed calendar quarter, in either case pro rated to the Termination Date.
Such amount shall offset (dollar for dollar) any obligation the Company or any
Affiliated Company may have under STIP to the Executive, but the Executive shall
in no event be required to repay any such amount should, for example, it exceed
the amount to which the Executive would otherwise have become entitled under
STIP.
(c) Vesting of Executive Benefits. All benefits of the Executive under
nonqualified deferred compensation plans and agreements (including without
limitation the BellSouth Corporation Deferred Compensation Plan, the BellSouth
Corporation Deferred Income Plan, the BellSouth Corporation Compensation
Deferral Plan, and the successors(s) to any such plan(s)), nonqualified
supplemental retirement and excess benefit plans (including without limitation
the BellSouth Corporation Supplemental Executive Retirement Plan and the
nonqualified excess benefit plan described in the BellSouth Personal Retirement
Account Pension Plan, and the successor(s) to any such plan(s)), and life
insurance plans or arrangements available only to executives or senior
management (including without limitation the BellSouth Corporation Executive
Life Insurance Plan and the BellSouth Corporation Senior Manager Life Insurance
Plan, and the successor(s) to any such plan(s)), in which the Executive is a
participant or to which the Executive is a party, shall be immediately vested
and all benefits and rights earned or accrued under such plans and agreements
through the Termination Date shall thereafter be nonforfeitable. Without
limiting the generality of the foregoing, all such benefits shall no longer be
subject to any reduction or forfeiture under, for example, any requirement,
provision or restriction in any plan or agreement regarding competition with
BellSouth or any Affiliated Company, recalculation of benefits as a result of
changes in the law (or interpretations thereof), or the continued performance of
services to the Company or Affiliated Companies. If the Executive is described
in Section 4.4 (a)(i)(B)(4) of the BellSouth Corporation Supplemental Executive
Retirement Plan, which provides service
credit under that plan for service with a former affiliate of the Company, or
comparable provision of any successor plan, the Executive's benefit under such
plan shall be calculated as if his credit for service with a former affiliate
has been fully earned under such provision prior to the Termination.
(d) Outplacement Services. The Company shall make available to the
Executive, at the Company's expense, outplacement services, the scope and
provider of which shall be selected by the Executive. The maximum amount for
which the Company shall be responsible under this subsection III (d) shall be
(i) $30,000, if immediately before the Change in Control the Executive was a
Tier I Officer, (ii) $20,000, if immediately before the Change in Control the
Executive was a Tier II Officer, and (iii) $25,000, if immediately before the
Change in Control the Executive was a Tier IIA Officer.
(e) No Mitigation. The Executive shall not be required to mitigate the
amount of any payment provided for in this Section III, nor shall the amount of
any payment or benefit provided for in this Section III be reduced by any
compensation earned by the Executive as the result of employment by another
employer or by retirement or other benefits received after the Termination Date
or otherwise. The Company's obligation to make payments provided for in this
Agreement and otherwise to perform its obligations hereunder shall not be
affected by any set-off, counterclaim, recoupment, defense or other claim, right
or action which the Company or any Affiliated Company may have against the
Executive or other parties.
IV. BellSouth Corporation Stock Plans.
Upon a Change in Control, all nonqualified stock options, incentive
stock options, and stock appreciation rights previously granted to the Executive
under the BellSouth Corporation Stock Option Plan and the BellSouth Corporation
Stock Plan, and any successor plan(s), which are not already vested, shall be
vested and immediately exercisable (subject to the otherwise applicable terms of
such plans and related option agreements). Also, upon a Change in Control, all
performance shares granted under the BellSouth Corporation Stock Plan, and any
successor plan(s), shall be subject to such terms and conditions as are set
forth in such plan and grant agreements with Executive with respect to the
performance shares.
V. Legal Fees and Expenses.
The Company shall pay to the Executive all legal fees and expenses as
and when incurred by the Executive in contesting or disputing any termination or
in seeking to obtain or enforce any right or benefit provided by this Agreement,
regardless of the outcome, unless in the case of a legal action brought by or in
the name of the Executive, a final determination is made by a court of competent
jurisdiction that such action was not brought by the Executive in good faith.
VI. Interest.
If the Company fails to make, or cause to be made, any payment provided
for herein by the date on which the payment is due, the Company shall make such
payment together with interest thereon. The interest shall accrue and be
compounded monthly. The interest rate shall be a per annum rate equal to 120
percent of the prime rate as reported by The Wall Street Journal for the first
business day of each month, effective for the ensuing month. The interest rate
shall be adjusted at the beginning of each month.
VII. Gross-Up For Excise Taxes.
(a) Gross-Up Payments. In the event that any payment or the value of
any benefit received or to be received by the Executive in connection with the
Executive's Termination or contingent upon a Change in Control, whether received
or to be received pursuant to the terms of this Agreement or of any other plan,
arrangement or agreement (the "Payments"), would be subject to the excise tax
imposed by Code Section 4999 or any comparable federal, state or local excise
tax (such excise taxes, together with any interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), as determined as
provided below, the Company shall pay to or for the benefit of the Executive an
additional amount (the "Gross-Up Payment") such that the net amount retained by
the Executive, after deduction of the Excise Tax on the Payments and any
federal, state and local income tax and Excise Tax upon the payment provided for
by this Section VII, and any interest, penalties or additions to tax payable by
the Executive with respect thereto, shall be equal to the total value of the
Payments. The intent of the parties is that the Company shall be solely
responsible for and shall pay any Excise Tax on any Payments and the Gross-Up
Payment and any income and employment taxes (including, without limitation,
penalties and interest) imposed on any Gross-Up Payments as well as any loss of
deduction caused by the Gross-Up Payment.
(b) Determinations Regarding Gross-Up Payments. All determinations
required to be made under this Section VII, including without limitation whether
and when a Gross-Up Payment is required and the amount of such Gross-Up Payment
and the assumptions to be utilized in arriving at such determinations, shall be
made by tax counsel selected by the Company and reasonably acceptable to the
Executive ("Tax Counsel"). The Company shall instruct the Tax Counsel to timely
provide the data required by this Section VII to the Executive. All fees and
expenses of the Tax Counsel shall be paid solely by the Company. Any Excise Tax
as determined pursuant to this subsection VII(b) shall be paid by the Company to
the Internal Revenue Service or other appropriate taxing authority on the
Executive's behalf promptly after receipt of the Tax Counsel's determination. If
the Tax Counsel determines that there is substantial authority, within the
meaning of Section 6662 of the Code (or appropriate authority under any
successor provisions), that no Excise Tax is payable by the Executive, the Tax
Counsel shall furnish the Executive with a written opinion that failure to
disclose or report the Excise Tax on the Executive's federal income tax return
will not constitute a
substantial understatement of tax or be reasonably likely to result in the
imposition of a negligence or similar penalty. Any determination by the Tax
Counsel shall be binding upon the Company, absent manifest error.
(c) Overpayments, Underpayments. As a result of the uncertainty in the
application of Section 4999 of the Code, at the time of the initial
determination by the Tax Counsel hereunder it is possible that Gross-Up Payments
not made by the Company should have been made ("underpayments"), or that
Gross-Up Payments will have been made by the Company which should not have been
made ("overpayments"). In either such event, the Tax Counsel shall determine the
amount of the underpayment or overpayment that has occurred. In the case of an
underpayment, the amount of such underpayment shall be promptly paid by the
Company to or for the benefit of the Executive. In the case of an overpayment,
the Executive shall, at the direction and expense of the Company, take such
steps as are reasonably necessary (including the filing of returns and claims
for refund), follow reasonable instructions from, and procedures established by,
the Company, and otherwise reasonably cooperate with the Company to correct such
overpayment; provided, however, that (i) the Executive shall not in any event be
obligated to return to the Company an amount greater than the net after-tax
portion of the overpayment that he has retained or has recovered as a refund
from the applicable taxing authorities and (ii) this provision shall be
interpreted in a manner consistent with the intent of this Section VII, which is
to make the Executive whole, on an after-tax basis, from the application of the
Excise Tax, it being understood that the correction of an overpayment may result
in the Executive repaying to the Company an amount which is less than the
overpayment.
VIII. Confidential Information.
Executive agrees to protect all Confidential Information. Executive
will not use, except in connection with work for Company or Affiliated
Companies, threaten to use, disclose or threaten to disclose, give or threaten
to give to others any Confidential Information.
IX. Successors; Enforcement; Dispute Resolution.
(a) Obligations of Successors. The Company will require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business and/or assets of the Company to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company is required to perform it. Failure of the
Company to obtain such assumption and agreement prior to the effectiveness of
any such succession shall be a breach of this Agreement and shall entitle the
Executive to compensation from the Company in the same amount and on the same
terms as the Executive would be entitled hereunder if the Executive had
terminated employment for Good Reason following a Change in Control of the
Company, except that for purposes of implementing the foregoing, the date on
which any such succession becomes effective shall be deemed the Termination
Date. As used in this Agreement, the "Company" shall mean the Company as
hereinabove defined
and any successor to its business and/or assets as aforesaid which assumes and
agrees to perform this Agreement by operation of law, or otherwise.
(b) Enforceable by Beneficiaries. This Agreement shall inure to the
benefit of and be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees (the "Beneficiaries"). In the event of the death of the
Executive while any amount would still be payable hereunder if such death had
not occurred, all such amounts, unless otherwise provided herein, shall be paid
in accordance with the terms of this Agreement to the Executive's Beneficiaries.
(c) Governing Law. Except as otherwise expressly provided herein, this
Agreement and the rights and obligations hereunder shall be construed and
enforced in accordance with the laws of the State of Georgia.
(d) Dispute Resolution. The parties agree to attempt in good faith to
resolve any controversy or claim arising out of or relating to this Agreement by
mediation in accordance with the Center for Public Resources Model Procedure for
Mediation of Business Disputes. If the matter has not been resolved pursuant to
the aforesaid mediation procedure within 60 days of the commencement of such
procedure (which period may be extended by mutual agreement), or if either party
will not participate in a mediation, the controversy shall be settled by
arbitration in accordance with the Center for Public Resources Rules for
Non-Administered Arbitration of Business Disputes, by a sole arbitrator. The
arbitration shall be governed by the United States Arbitration Act, 9 U.S.C.
Sections 1-16, and judgment upon the award rendered by the arbitrator may be
entered by any court having jurisdiction thereof. The place of arbitration shall
be Atlanta, Georgia, unless otherwise agreed upon. The arbitrator is not
empowered to award punitive or other damages that are in excess of actual,
contractual damages.
X. General Provisions.
(a) Term of Agreement. This Agreement shall become effective on the
date hereof and shall continue in effect until the earliest of (a) January 1,
2006, if no Change in Control or Potential Change in Control has occurred before
that date or, if as of such date a Potential Change in Control shall have
occurred, the earliest date thereafter on which the threat of such Potential
Change in Control becoming a Change in Control is eliminated; (b) the
termination of the Executive's employment with the Company for any reason prior
to a Potential Change in Control; (c) the termination of the Executive's
employment with the Company, other than as described in subsection II(c), prior
to a Change in Control; (d) the Company's termination of the Executive's
employment for Cause, or the Executive's resignation for other than Good Reason,
following a Change in Control. Notwithstanding the foregoing, commencing on
January 1, 2006 (or such later expiration date prescribed by clause (a) of the
preceding sentence), and on the third anniversary of such date, and successive
third anniversaries thereafter, the expiration date prescribed by clause (a) of
the preceding sentence shall automatically be extended for an additional three
(3) years unless, not later than one hundred eighty (180) days prior to the
date on which this Agreement would otherwise automatically be extended, one of
the parties hereto shall have given notice to the other party that it (or he or
she) does not wish to extend the term of this Agreement. Notwithstanding
anything to the contrary in this Agreement, this Agreement shall in no event
terminate before both the Company and the Executive have fulfilled, or have had
satisfied, all of their rights, obligations and liabilities under this
Agreement.
(b) Amendment. No amendment or modification to this Agreement shall be
effective unless in writing and signed by both the Company and the Executive.
(c) Disposition of Employer. In the event the Executive is employed by
a Subsidiary, the terms of this Agreement shall expire if such Subsidiary is
sold or otherwise disposed of prior to a Change in Control (and in a transaction
which is not a Change in Control) unless the Executive continues in employment
with the Company or a Subsidiary after such sale or other disposition. If the
Company or Subsidiary employing the Executive is sold or disposed of following a
Change in Control, this Agreement shall continue through its original term or
any extended term then in effect.
(d) Withholding. All payments made hereunder shall be reduced by any
applicable federal, state, or local withholding or other taxes or charges as may
be required by applicable law.
(e) Nonduplication. If an Executive who becomes entitled to the
benefits described in Section III shall also be entitled to severance pay or
enhanced benefits, or both, under the terms of a contract or arrangement (other
than a benefit plan or arrangement generally applicable to executives),
including without limitation agreements entered into by the Executive and the
Company or a Participating Company in connection with executive succession
planning, the Executive shall be entitled to the benefits under Section III only
if the Executive waives and relinquishes all rights to all such payments and
benefits under such other contract or arrangement.
(f) Notices. All notices provided for in this Agreement shall be in
writing. Notices to the Company shall be deemed given when personally delivered
or sent by certified or registered mail or overnight delivery service to Room
19A01, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
Corporate Secretary. Notices to the Executive shall be deemed given when
personally delivered or sent by certified or registered mail or overnight
delivery service to the last address for the Executive shown on the records of
the Company. Either the Company or the Executive may, by notice to the other,
designate an address other than the foregoing for the receipt of subsequent
notices.
(g) Waivers. No waiver of any provision of this Agreement shall be
valid unless approved in writing by the party giving such waiver. No waiver of a
breach under any provision of this Agreement shall be deemed to be a waiver of
such provision or any other provision of this Agreement or any subsequent
breach. No failure on the part of either the Company or the Executive to
exercise, and no delay in exercising, any right or
remedy conferred by law or this Agreement shall operate as a waiver of such
right or remedy, and no exercise or waiver, in whole or in part, of any right or
remedy conferred by law or herein shall operate as a waiver of any other right
or remedy.
(h) Severability. If any provision of this Agreement shall be held
unlawful or otherwise invalid or unenforceable in whole or in part, such
unlawfulness, invalidity or unenforceability shall not affect any other
provision of this Agreement or part thereof, each of which shall remain in full
force and effect. If the making of any payment or the provision of any other
benefit required under this Agreement shall be held unlawful or otherwise
invalid or unenforceable, such unlawfulness, invalidity or unenforceability
shall not prevent any other payment or benefit from being made or provided under
this Agreement, and if the making of any payment in full or the provision of any
other benefit required under this Agreement in full would be unlawful or
otherwise invalid or unenforceable, then such unlawfulness, invalidity or
unenforceability shall not prevent such payment or benefit from being made or
provided in part, to the extent that it would not be unlawful, invalid or
unenforceable, and the maximum payment or benefit that would not be unlawful,
invalid or unenforceable shall be made or provided under this Agreement.
(i) Agents. The Company may make arrangements to cause any agent or
other party, including an Affiliated Company, to make any payment or to provide
any benefit that the Company is required to make or to provide hereunder;
provided, that no such arrangement shall relieve or discharge the Company of its
obligations hereunder except to the extent that such payments or benefits are
actually made or provided.
(j) Headings. The headings of the various sections and subsections of
this Agreement are solely for convenience and shall not be relied upon in
construing the provisions of the Agreement. Any reference to a section or
subsection shall refer to a section or subsection of the Agreement unless
specified otherwise.
(k) Gender and Number. Any use of gender in this Agreement will be
deemed to include all genders when appropriate, and use of the singular number
will be deemed to include the plural when appropriate, and vice versa in each
instance.
(l) Entire Agreement. This Agreement contains the entire agreement
between the parties and no statements, promises or inducements made by any party
hereto, or agents of either party, which are not contained in this Agreement
shall be valid or binding; provided, however, that except as expressly provided
herein the matters dealt with herein supersede previous written agreements
between the parties on the same subject matters only to the extent such previous
provisions are inconsistent with this Agreement and other provisions in written
agreements between the parties not inconsistent with this Agreement are not
affected.
(m) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute a single instrument.
(n) Employment. Except in the event of a Change in Control and,
thereafter, only as specifically set forth in this Agreement, nothing in this
Agreement shall be construed to (i) limit in any way the right of the Company or
a Subsidiary to terminate the Executive's employment at any time for any reason
or for no reason; or (ii) be evidence of any agreement or understanding,
expressed or implied, that the Company or a Subsidiary will employ the Executive
in any particular position, on any particular terms or at any particular rate
remuneration.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
EXECUTIVE: BELLSOUTH CORPORATION
_____________________________ By: _______________________________
[NAME] Title: Vice President - Human Resources
