EXHIBIT 10.6
May 29, 2002
Xx. Xxxxx Xxxxx
0000 Xxxxxxxx Xxxxx, Xxx. L
Kirkland, WA 98033
Dear Xxxxx:
This letter consists of an agreement to amend the terms and conditions of the
retirement provision of your original offer letter, dated May 16, 2001, which
stated that:
Upon reaching age 55, you will be granted a payment of $125,000
on an annual basis in recognition of the lost value of the retirement
program from your previous employer.
In essence, this provision will be replaced with two distinct benefits. First,
payments through age 58 will be provided in accordance with the "Special
Retirement Payments" section of this agreement. After age 58, payments will be
made in accordance with the terms of the Executive Life Program Split Dollar
Agreement.
SPECIAL RETIREMENT PAYMENTS
AT&T Wireless Services, Inc. (the "Company") will provide three annual payments
of $125,000 (gross), with the first such payment due on or around March 16,
2004. Please note that all applicable payroll taxes will be deducted from these
payments, the withholding for which will occur with the regular payroll that is
scheduled on or immediately following the target payment dates. Subsequent
payments will occur on or around March 16, 2005 and March 16, 2006.
Payments are contingent on your remaining employed by the Company in a
comparable position through March 16, 2004. Additionally, all outstanding
payments will become immediately due and payable if a termination of your
employment occurs prior to March 16, 2004 due to any of the following: your
death; your long-term disability as determined by AT&T Wireless; or a Company
initiated termination of your employment for any reason, other than Cause. For
purposes of this agreement, Cause shall have the meaning as set forth in the
Employee's offer letter. Additionally, if a Change in Control occurs before all
payments are made, the Company would fully fund any outstanding payments via an
appropriate grantor trust.
Payments under this agreement are in addition to and not in lieu of qualified or
non-qualified pension, savings or other retirement plan, program or arrangements
to which you are otherwise entitled. The payments provided under this agreement
are not included in the base for calculating benefits under any employee or
management benefit plan, program or practice.
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DEFERRAL OPTION
Should you remain employed after March 16, 2004, you may defer receipt of any or
all of the Special Retirement Payments until termination. If you choose to defer
one or more of these payments, the Company will establish a Deferred
Compensation Account ("Account") under your name. The Account will be maintained
and paid to you in accordance with the provisions set herein. The Account will
be maintained as a bookkeeping account on the records of the Company and subject
to the claims of general creditors of the Company. You will have no ownership
interest in the Account, or in any assets of the Company with respect thereto.
The Account may not be assigned, pledged or otherwise alienated by you, and any
attempt to do so, or any garnishment, execution of levy of any kind with respect
to the account will not be recognized. You will not have any right to receive
any payment with respect to the Account, except as expressly stated below.
Your irrevocable deferral election must be made on or before December 31, 2002
and you must remain employed through the applicable payment date for the
deferral to remain valid. Upon termination of your employment for any reason,
all amounts credited to the Account will be paid in one, two or three
approximately equal annual installments, as elected by you, with the initial
installment due in the first calendar quarter following the calendar quarter in
which you terminate and any subsequent installment payable on the applicable
anniversary of such due date. You will be responsible for applicable FICA,
Medicare, and income taxes.
The interest credited on the amounts in the Account will be compounded as of the
end of each calendar quarter for as long as any sums remain in the Account. The
quarterly rate of interest applied at the end of any calendar quarter will be
equal to 25% of the average 10-year Treasury Note rate for the previous quarter.
Should you die prior to the time the final installment has been paid to you, the
Company will make the remaining payments to your beneficiary (as designated via
the employee benefits program), unless you designate otherwise in writing, or to
your estate if no beneficiary has been designated.
Xxxxx, we trust this agreement will meet your expectations for providing the
bridge to the benefits available to you under the Executive Life Program Split
Dollar Agreement. If you agree, please sign below and timely apprise us of your
desire to defer the payments. We will prepare the necessary deferral documents
if you timely elect deferral.
Sincerely,
/s/ Xxxx Xxxxxx
Xxxx Xxxxxx
EVP, Human Resources
AT&T Wireless Services
Agreed:
/s/ Xxxxx Xxxxx May 29, 2002
--------------------------- Date
Xxxxx Xxxxx
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