AGREEMENT
This Agreement, dated January 30, 1997 is made by and between ALLTEL
Corporation, a Delaware corporation (as hereinafter defined, the "Corporation"),
and Xxxxxxx X. Xxx (as hereinafter defined, the "Executive").
WHEREAS, the Board of Directors of the Corporation (as hereinafter
defined, the "Board") recognizes that the possibility of a Change in Control (as
hereinafter defined) of the Corporation exists and that such possibility, and
the uncertainty it may cause, may result in the departure or distraction of key
management employees of the Corporation or of a Subsidiary to the detriment of
the Corporation and its stockholders; and
WHEREAS, the Executive is a key management employee of the Corporation
or of a Subsidiary; and
WHEREAS, the Board has determined that the Corporation should encourage
the continued employment of the Executive by the Corporation or a Subsidiary and
the continued dedication of the Executive to his assigned duties without
distraction as a result of the circumstances arising from the possibility of a
Change in Control;
NOW THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Corporation and the Executive hereby agree as
follows:
1. Defined Terms. For purposes of this Agreement,
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the following terms shall have the meanings indicated below:
(A) "Board" shall mean the Board of Directors of
the Corporation, as constituted from time to time.
(B) "Cause" for termination by the Corporation of
the Executive's employment shall mean (i) the willful failure by the Executive
substantially to perform the Executive's duties with the Corporation or a
Subsidiary, other than any failure resulting from the Executive's incapacity
due to physical or mental illness or any actual or anticipated failure after
the issuance of a Notice of Termination for Good Reason by the Executive in
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accordance with paragraph (A) of Section 6, that continues for at least 30 days
after the Board delivers to the Executive a written demand for performance that
identifies specifically and in detail the manner in which the Board believes
that the Executive willfully has failed substantially to perform the Executive's
duties or (ii) the willful engaging by the Executive in misconduct that is
demonstrably and materially injurious to the Corporation or any Subsidiary,
monetarily or otherwise. For purposes of this definition, no act, or failure to
act, on the Executive's part shall be deemed "willful" unless done, or omitted
to be done, by the Executive not in good faith and without reasonable belief
that the Executive's act, or failure to act, was in the best interest of the
Corporation and its Subsidiaries:
(C) A "Change in Control" shall mean, if
subsequent to the date of this Agreement:
(i) Any "person," as defined in Section 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), other than the Corporation, any of its subsidiaries, or any
employee benefit plan maintained by the Corporation or any of its
subsidiaries, becomes the "beneficial owner" (as defined in Rule l3d-3
under the Exchange Act) of (A) l5% or more, but no greater than 50%, of
the outstanding voting capital stock of the Corporation, unless prior
thereto, the Continuing Directors approve the transaction that results
in the person becoming the beneficial owner of 15% or more, but no
greater than 50%, of the outstanding voting capital stock of the
Corporation or (B) more than 50% of the outstanding voting capital
stock of the Corporation, regardless whether the transaction or event
by which the foregoing 50% level is exceeded is approved by the
Continuing Directors;
(ii) At any time Continuing Directors no longer
constitute a majority of the directors of the Corporation; or
(iii) A record date is fixed for determining
stockholders entitled to vote upon (A) a merger or consolidation of the
Corporation, statutory share exchange, or other similar transaction
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with another corporation, partnership, or other entity or enterprise in
which either the Corporation is not the surviving or continuing
corporation or shares of common stock of the Corporation are to be
converted into or exchanged for cash, securities other than common
stock of the Corporation, or other property, (B) a sale or disposition
of all or substantially all of the assets of the Corporation, or (C)
the dissolution of the Corporation; or
(iv) The Corporation enters into an agreement with
any Person, the consummation of which would result in the occurrence
of an event described in clause (i), (ii) or (iii) above of this
paragraph (C).
(D) "Code" shall mean the Internal Revenue Code
of 1986, as amended from time to time.
(E) "Continuing Directors" means directors
who were directors of the Corporation at the beginning of the 24-month period
ending on the date the determination is made or whose election, or nomination
for election by the Corporation's stockholders, was approved by at least a
majority of the directors who are in office at the time of the election or
nomination and who either (i) were directors at the beginning of the period, or
(ii) were elected, or nominated for election, by at least a majority of the
directors who were in office at the time of the election or nomination and were
directors at the beginning of the period.
(F) "Corporation" shall mean ALLTEL Corporation
and any successor to its business or assets, by operation of law or otherwise.
(G) "Date of Termination" shall have the
meaning stated in paragraph (B) of Section 6 hereof.
(H) "Disability" shall be deemed the reason
for the termination by the Corporation of the Executive's employment, if, as a
result of the Executive's incapacity due to physical or mental illness, the
Executive shall have been absent from the full-time performance of the
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Executive's duties with the Corporation or a Subsidiary for a period of six
consecutive months, the Corporation shall have given the Executive a Notice of
Termination for Disability, and, within 20 business days after the Notice of
Termination is given, the Executive shall not have returned to the full-time
performance of the Executive's duties.
(I) "Executive" shall mean the individual named
in the first paragraph of this Agreement.
(J) "Good Reason" for termination by the
Executive of the Executive's employment shall mean the occurrence, without the
Executive's express written consent, of any one of the following:
(i) the assignment to the Executive of any duties
inconsistent with the Executive's status as an executive officer of the
Corporation or of a Subsidiary or a substantial adverse alteration in
the nature or status of the Executive's responsibilities from those in
effect immediately prior to the Change in Control;
(ii) a reduction by the Corporation in the
Executive's annual base salary to any amount less than the Executive's
annual base salary as in effect immediately prior to the Change in
Control;
(iii) the relocation of the principal executive
offices of the Corporation or of a Subsidiary, as the case may be, to a
location more than 35 miles from the location of such offices
immediately prior to the Change in Control or the Corporation's
requiring the Executive to be based anywhere other than the principal
executive offices of the Corporation or of a Subsidiary as the case may
be, except for required business travel to an extent substantially
consistent with the Executive's business travel obligations immediately
prior to the Change in Control;
(iv) the failure by the Corporation to pay to the
Executive any portion of the Executive's current compensation, or to
pay to the Executive any deferred compensation under any deferred
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compensation program of the Corporation, within five days after the
date the compensation is due or to pay or reimburse the Executive for
any expenses incurred by him for required business travel;
(v) the failure by the Corporation to continue in
effect any compensation plan in which the Executive participates
immediately prior to the Change in Control that is material to the
Executive's total compensation, including but not limited to, stock
option, restricted stock, stock appreciation right, incentive
compensation, bonus, and other plans, unless an equitable alternative
arrangement embodied in an ongoing substitute or alternative plan has
been made, or the failure by the Corporation to continue the
Executive's participation therein (or in a substitute or alternative
plan) on a basis not materially less favorable, both in terms of the
amount of compensation provided and the level of the Executive's
participation relative to other participants, than existed immediately
prior to the Change in Control;
(vi) the failure by the Corporation to continue to
provide the Executive with benefits substantially similar to those
enjoyed by the Executive under any of the Corporation's pension,
profit-sharing, life insurance, medical, health and accident,
disability, or other employee benefit plans in which the Executive was
participating immediately prior to the Change in Control; the failure
by the Corporation to continue to provide the Executive any material
fringe benefit or perquisite enjoyed by the Executive immediately prior
to the Change in Control; or the failure by the Corporation to provide
the Executive with the number of paid vacation days to which the
Executive is entitled in accordance with the Corporation's normal
vacation policy in effect immediately prior to the Change in Control;
or
(vii) any purported termination by the Corporation
of the Executive's employment that is not effected in accordance with a
Notice of Termination satisfying the requirements of paragraph (A) of
Section 6 hereof.
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(K) "Notice of Termination" shall have the
meaning stated in paragraph (A) of Section 6 hereof.
(L) "Payment Trigger" shall mean the occurrence
of a Change in Control during the term of this Agreement coincident with or
followed (i) at any time before the end of the 12th month immediately
following the month in which the Change in Control occurred, by the termination
of the Executive's employment with the Corporation or a Subsidiary for any
reason other than (A) by the Executive without Good Reason, (B) by the
Corporation as a result of the Disability of the Executive or with Cause or, (C)
as a result of the death of the Executive or (ii) in the event the Executive
remains continuously employed by the Corporation or a Subsidiary until the end
of the 12th month immediately following the month in which the Change in Control
occurred, the termination of the Executive's employment with the Corporation or
a Subsidiary, at any time during the three month period immediately following
the expiration of such 12-month period, for any reason other than (A) by the
Corporation as a result of the Disability of the Executive or (B) as a result of
the death of the Executive.
(M) "Person" shall have the meaning given in
Section 3(a)(9) of the Securities Exchange Act of 1934, as amended from time to
time, as modified and used in Sections 13(d) and 14(d) thereof; except that, a
Person shall not include (i) the Corporation or any Subsidiary, (ii) a trustee
or other fiduciary holding securities under an employee benefit plan of the
Corporation or any Subsidiary, or (iii) an underwriter temporarily holding
securities pursuant to an offering of such securities.
(N) "Subsidiary" shall mean any corporation or
other entity or enterprise, whether incorporated or unincorporated, of which
at least a majority of the securities or other interests having by their terms
ordinary voting power to elect a majority of the board of directors or others
serving similar functions with respect to such corporation or other entity or
enterprise is owned by the Corporation or other entity or enterprise of which
the Corporation directly or indirectly owns securities or other interests having
all the voting power.
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2. Term of Agreement. This Agreement shall become
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effective on the date hereof and, subject to the second sentence of this Section
2, shall continue in effect until the earliest of (i) a Date of Termination in
accordance with Section 6 or the death of the Executive shall have occurred
prior to a Change in Control, (ii) if a Payment Trigger shall have occurred
during the term of this Agreement, the performance by the Corporation of all its
obligations, and the satisfaction by the Corporation of all its obligations and
liabilities, under this Agreement, (iii) the ten year anniversary of the date of
this Agreement if, as of that ten year anniversary, a Change in Control shall
not have occurred and be continuing, or (iv) in the event, as of the ten year
anniversary of the date of this Agreement, a Change in Control shall have
occurred and be continuing, either the expiration of such period thereafter
within which a Payment Trigger does not or can not occur or the ensuing
occurrence of a Payment Trigger and the performance by the Corporation of all of
its obligations and liabilities under this Agreement. Any Change in Control
during the term of this Agreement that for any reason ceases to constitute a
Change in Control or is not followed by a Payment Trigger shall not effect a
termination or lapse of this Agreement. Any transfer of the Executive's
employment from the Corporation to a Subsidiary, from a Subsidiary to the
Corporation, or from one Subsidiary to another Subsidiary shall not constitute a
termination of the Executive's employment for purposes of this Agreement.
3. General Provisions.
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(A) The Corporation hereby represents and
warrants to the Executive as follows: The execution and delivery of this
Agreement and the performance by the Corporation of the actions contemplated
hereby have been duly authorized by all necessary corporate action on the part
of the Corporation. This Agreement is a legal, valid and legally binding
obligation of the Corporation enforceable in accordance with its terms. Neither
the execution or delivery of this Agreement nor the consummation by the
Corporation of the actions contemplated hereby (i) will violate any provision of
the certificate of incorporation or bylaws (or other charter documents) of the
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Corporation, (ii) will violate or be in conflict with any applicable law or any
judgment, decree, injunction or order of any court or governmental agency or
authority, or (iii) will violate or conflict with or constitute a default (or an
event of which, with notice or lapse of time or both, would constitute a
default) under or will result in the termination of, accelerate the performance
required by, or result in the creation of any lien, security interest, charge or
encumbrance upon any of the assets or properties of the Corporation under, any
term or provision of the certificate of incorporation or bylaws (or other
charter documents) of the Corporation or of any contract, commitment,
understanding, arrangement, agreement or restriction of any kind or character to
which the Corporation is a party or by which the Corporation or any of its
properties or assets may be bound or affected.
(B) No amount or benefit shall be payable under
this Agreement unless there shall have occurred a Payment Trigger during the
term of this Agreement. In no event shall payments in accordance with this
Agreement be made in respect of more than one Payment Trigger.
(C) This Agreement shall not be construed as
creating an express or implied contract of employment and, except as otherwise
agreed in writing between the Executive and the Corporation, the Executive shall
not have any right to be retained in the employ of the Corporation or of a
Subsidiary. Notwithstanding the immediately preceding sentence or any other
provision of this Agreement, no purported termination of the Executive's
employment that is not effected in accordance with a Notice of Termination
satisfying paragraph (A) of Section 6 shall be effective for purposes of this
Agreement. The Executive's right, following the occurrence of a Change in
Control, to terminate his employment under this Agreement for Good Reason shall
not be affected by the Executive's Disability or incapacity. The Executive's
continued employment shall not constitute consent to, or a waiver of rights with
respect to, any act or failure to act constituting Good Reason under this
Agreement.
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4. Payments Due Upon a Payment Trigger.
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(A) The Corporation shall pay to the Executive
the payments described in this Section 4 upon the occurrence of a Payment
Trigger during the term of this Agreement.
(B) Upon the occurrence of a Payment Trigger
during the term of this Agreement, the Corporation shall pay to the Executive a
lump sum payment, in cash, equal to the product of:
(i) three multiplied by
(ii) the sum of --
(a) the higher of the Executive's annual base
salary in effect immediately prior to the occurrence of the
Change in Control or the Executive's annual base salary in
effect immediately prior to the Payment Trigger, plus
(b) the higher of the aggregate maximum amounts
payable to the Executive pursuant to all incentive
compensation plans for the fiscal year or other measuring
period commencing coincident with or most recently prior to
the date on which the Change in Control occurs or the
aggregate maximum amounts payable to the Executive pursuant to
all incentive compensation plans for the fiscal year or other
measuring period commencing coincident with or most recently
prior to the date on which the Payment Trigger occurs, in each
case, assuming that the Executive were continuously employed
by the Corporation or a Subsidiary on the terms and
conditions, including, without limitation, the terms of the
incentive plans, in effect immediately prior to the Change in
Control or Payment Trigger, whichever applies, until the last
day of that fiscal year or other measuring period.
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The amount determined under the foregoing provisions of this paragraph (B) shall
be reduced by any cash severance benefit otherwise paid to the Executive under
any applicable severance plan or other severance arrangement. For purposes of
this paragraph (B), amounts payable to the Executive pursuant to an incentive
compensation plan for the fiscal year or other measuring period commencing
coincident with or most recently prior to the date on which the Change of
Control or Payment Trigger, as applicable, occurs (the "applicable year/period")
shall not include amounts attributable to a fiscal year or other measuring
period that commenced prior to the applicable year/period and that become
payable during the applicable year/period. For purposes of this paragraph (B),
incentive compensation plans shall include, without limitation, the ALLTEL
Corporation Performance Incentive Compensation Plan as in effect from time to
time, the ALLTEL Corporation Long-Term Performance Incentive Compensation Plan
as in effect from time to time, and any incentive bonus plan or arrangement that
provides for payment of cash compensation, and shall exclude, without
limitation, the ALLTEL Corporation Executive Deferred Compensation Plan as in
effect from time to time, any plan qualified or intended to be qualified under
Section 401(a) of the Code and any plan supplementary thereto, executive fringe
benefits, and any plan or arrangement under which stock, stock options, stock
appreciation rights, restricted stock or similar options, stock, or rights are
issued.
(C) Notwithstanding any provision of any
incentive compensation plan, including, without limitation, any provision of any
incentive plan requiring continued employment after the completed fiscal year or
other measuring period, the Corporation shall pay to the Executive a lump sum
amount, in cash, equal to the amount of any incentive compensation that has been
allocated or awarded to the Executive for a completed fiscal year or other
measuring period preceding the occurrence of a Payment Trigger under any
incentive compensation plan but has not yet been paid to the Executive.
(D) The payments provided for in paragraphs (B)
and (C) of this Section 4 shall be made not later than the fifth day following
the occurrence of a Payment Trigger, unless the amounts of such payments cannot
be finally determined on or before that day, in which case, the Corporation
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shall pay to the Executive on that day an estimate, as reasonably determined in
good faith by the Corporation, of the minimum amount of the payments to which
the Executive is clearly entitled and shall pay the remainder of the payments
(together with interest at the rate provided in Section 1274(b)(2)(B) of the
Code) as soon as the amount thereof can be determined but in no event later
than the thirtieth day after the occurrence of a Payment Trigger. In the event
the amount of the estimated payments exceeds the amount subsequently determined
to have been due, the excess shall constitute a loan by the Corporation to the
Executive, payable on the fifth business day after demand by the Corporation
(together with interest at the rate provided in Section l274(b)(2)(B) of the
Code). At the time that payments are made under this Section 4, the Corporation
shall provide the Executive with a written statement setting forth the manner
in which the payments were calculated and the basis for the calculations
including, without limitation, any opinions or other advice the Corporation has
received from outside counsel, auditors or consultants (and any opinions or
advice that are in writing shall be attached to the statement).
5. Gross-Up Payments.
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(A) This Section 5 shall apply if a Payment
Trigger shall have occurred during the term of this Agreement.
(B) In the event it shall be determined that any
payment or distribution by the Corporation or other amount with respect to
the Corporation to or for the benefit of the Executive, whether paid or payable
or distributed or distributable pursuant to the terms of this Agreement or
otherwise, but determined without regard to any additional payments required
under this Section 5 (a "Payment"), is (or will be) subject to the excise tax
imposed by Section 4999 of the Code or any interest or penalties are (or will
be) incurred by the Executive with respect to the excise tax imposed by Section
4999 of the Code with respect to the Corporation (the excise tax, together with
any interest and penalties, are hereinafter collectively referred to as the
"Excise Tax"), the Executive shall be entitled to receive an additional cash
payment (a "Gross-Up Payment") from the Corporation in an amount equal to the
sum of the Excise Tax and an amount sufficient to pay the cumulative Excise Tax
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and all cumulative income taxes (including any interest and penalties imposed
with respect to such taxes) relating to the Gross-Up Payment so that the net
amount retained by the Executive is equal to all payments received pursuant to
the terms of this Agreement or otherwise less income taxes (but not reduced by
the Excise Tax).
(C) Subject to the provisions of paragraph (D)
of this Section 5, all determinations required to be made under this Section 5,
including 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 the
determination, shall be made by a nationally recognized certified public
accounting firm designated by the Executive (the "Accounting Firm") which shall
provide detailed supporting calculations both to the Corporation and the
Executive within 30 days after the receipt of notice from the Executive that
there has been a Payment, or such earlier time as is requested by the
Corporation. In the event that at any time relevant to this Agreement the
Accounting Firm is serving as accountant or auditor for the individual, entity
or group or Person effecting the Change in Control, the Executive shall appoint
another nationally recognized certified public accounting firm to make the
determinations required hereunder (which accounting firm shall then be referred
to as the Accounting Firm hereunder). All fees and expenses of the Accounting
Firm shall be borne solely by the Corporation. Any Gross-Up Payment, as
determined in accordance with this Section 5, shall be paid by the Corporation
to the Executive within five days after the receipt of the Accounting Firm's
determination. If the Accounting Firm determines that no Excise Tax is payable
by the Executive, it shall so indicate to the Executive in writing. Any
determination by the Accounting Firm shall be binding upon the Corporation and
the Executive. As a result of uncertainty in the application of Section 4999 of
the Code at the time of the initial determination by the Accounting Firm, it is
possible that Gross-Up Payments that the Corporation should have made will not
have been made (an "Underpayment"), consistent with the calculations required to
be made hereunder. In the event the Corporation exhausts its remedies in
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accordance with paragraph (D) of this Section 5 and the Executive thereafter is
required to make a payment of any Excise Tax, the Accounting Firm shall
determine the amount of Underpayment that has occurred and the Underpayment
shall be promptly paid by the Corporation to or for the benefit of the
Executive.
(D) The Executive shall notify the Corporation in
writing of any claim by the Internal Revenue Service that, if successful, would
require a Gross-Up Payment (that has not already been paid by the Corporation).
The notification shall be given as soon as practicable but no later than ten
business days after the Executive is informed in writing of the claim and shall
apprise the Corporation of the nature of the claim and the date on which the
claim is requested to be paid. The Executive shall not pay the claim prior to
the expiration of the 30-day period following the date on which the Executive
gives notice to the Corporation or any shorter period ending on the date that
any payment of taxes with respect to the claim is due. If the Corporation
notifies the Executive in writing prior to the expiration of the 30-day period
that it desires to contest the claim, the Executive shall:
(i) give the Corporation any information
reasonably requested by the Corporation relating to the claim;
(ii) take any action in connection with contesting
the claim as the Corporation shall reasonably request in writing from
time to time, including, without limitation, accepting legal
representation with respect to the claim by an attorney reasonably
selected by the Corporation;
(iii) cooperate with the Corporation in good faith
in order effectively to contest the claim; and
(iv) permit the Corporation to participate in any
proceedings relating to the claim.
The Corporation shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with the contest and
shall indemnify and hold the Executive harmless, on an after-tax basis, for any
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Excise Tax or income tax (including interest and penalties with respect thereto)
imposed as a result of the representation and payment of costs and expenses.
Without limitation of the foregoing provisions of this Section 5, the
Corporation shall control all proceedings taken in connection with the contest
and, at its sole option, may pursue or forego any and all administrative
appeals, proceedings, hearings, and conferences with the taxing authority in
respect of the claim and may, at its sole option, either direct the Executive to
pay the tax claimed and xxx for a refund or contest the claim in any permissible
manner, and the Executive agrees to prosecute the contest to a determination
before any administrative tribunal, in a court of initial jurisdiction and in
one or more appellate courts, as the Corporation shall determine. If the
Corporation directs the Executive to pay the claim and xxx for a refund, the
Corporation shall advance the amount of the payment to the Executive, on an
interest-free basis, and shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax (including interest or
penalties with respect thereto) imposed with respect to the advance or with
respect to any imputed income with respect to the advance; and any extension of
the statute of limitations relating to payment of taxes for the taxable year of
the Executive with respect to which the contested amount is claimed to be due
shall be limited solely to the contested amount. The Corporation's control of
the contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.
(E) If, after the receipt by the Executive of an
amount advanced by the Corporation pursuant to paragraph (D) of this Section 5,
the Executive becomes entitled to receive any refund with respect to the claim,
the Executive shall, subject to the Corporation's compliance with the
requirements of paragraph (D) of this Section 5, promptly pay to the Corporation
the amount of the refund (together with any interest paid or credited thereon
after taxes applicable thereto). If, after the receipt by the Executive of an
amount advanced by the Corporation pursuant to paragraph (D) of this Section 5,
a determination is made that the Executive shall not be entitled to any refund
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with respect to the claim and the Corporation does not notify the Executive in
writing of its intent to contest the denial of refund prior to the expiration of
30 days after the determination, then the advance shall be forgiven and shall
not be required to be repaid and the amount of the advance shall offset, to the
extent thereof, the amount of Gross-Up Payment required to be paid.
6. Termination Procedures.
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(A) During the term of this Agreement, any
purported termination of the Executive's employment (other than by reason of
death) shall be communicated by written Notice of Termination from one party
hereto to the other party hereto in accordance with Section 10 hereof. For
purposes of this Agreement, a "Notice of Termination" shall mean a written
notice that indicates the specific termination provision in this Agreement
relied upon, and, if applicable, the notice 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. Further, a Notice of
Termination for Cause shall include a copy of a resolution duly adopted by the
affirmative vote of not less than a majority of the entire membership of the
Board at a meeting of the Board that was called and held for the purpose of
considering the termination finding that, in the informed, reasonable, good
faith judgment of the Board, the Executive was guilty of conduct set forth in
the definition of Cause in Section 1(B), and specifying the particulars thereof
in detail.
(B) "Date of Termination" with respect to any
purported termination of the Executive's employment during the term of this
Agreement (other than by reason of death) shall mean (i) if the Executive's
employment is terminated for Disability, 20 business days after Notice of
Termination is given (provided that the Executive shall not have returned to the
full-time performance of the Executive's duties during that 20 business day
period) and (ii) if the Executive's employment is terminated for any other
reason, the date specified in the Notice of Termination, which, in the case of a
termination by the Corporation, shall not be less than ten business days except
in the case of a termination for Cause, and, in the case of a termination by the
Executive, shall not be less than ten business days nor more than 20 business
days, respectively, after the date such Notice of Termination is given.
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7. No Mitigation. The Executive shall not be
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required to seek other employment or to attempt in any way to reduce any amounts
payable to the Executive by the Corporation pursuant to this Agreement. Further,
the amount of any payment or benefit provided for in this Agreement shall not be
reduced by any compensation earned by the Executive as the result of employment
by another employer, by retirement benefits, by offset against any amount
claimed to be owed by the Executive to the Corporation or a Subsidiary, or
otherwise.
8. Disputes.
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(A) If a dispute or controversy arises out of or
in connection with this Agreement, the parties shall first attempt in good
faith to settle the dispute or controversy by mediation under the Commercial
Mediation Rules of the American Arbitration Association before resorting to
arbitration or litigation. Thereafter, any remaining unresolved dispute or
controversy arising out of or in connection with this Agreement shall, upon a
written notice from the Executive to the Corporation either before suit
thereupon is filed or within 20 business days thereafter, be settled exclusively
by arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Association in a city located within the continental United
States designated by the Executive. Judgment may be entered on the arbitrator's
award in any court having jurisdiction. The Executive shall, however, be
entitled to seek specific performance of the Corporation's obligations hereunder
during the pendency of any dispute or controversy arising under or in connection
with this Agreement.
(B) Any legal action concerning this Agreement,
other than a mediation or an arbitration described in paragraph (A) of this
Section 8, whether instituted by the Corporation or the Executive, shall be
brought and resolved only in a state court of competent jurisdiction located
in the territory that encompasses the city, county, or parish in which the
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Executive's principal residence is located at the time such action is commenced.
The Corporation hereby irrevocably consents and submits to and shall take any
action necessary to subject itself to the personal jurisdiction of that court
and hereby irrevocably agrees that all claims in respect of the action shall be
instituted, heard, and determined in that court. The Corporation agrees that
such court is a convenient forum, and hereby irrevocably waives, to the fullest
extent it may effectively do so, the defense of an inconvenient forum to the
maintenance of the action. Any final judgment in the action may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law.
(C) The Corporation shall pay all costs and
expenses, including attorneys' fees and disbursements, of the Corporation and,
at least monthly, the Executive in connection with any legal proceeding
(including arbitration), whether or not instituted by the Corporation or the
Executive, relating to the interpretation or enforcement of any provision of
this Agreement, provided that if the Executive instituted the proceeding and the
judge, arbitrator, or other individual presiding over the proceeding
affirmatively finds that the Executive instituted the proceeding in bad faith,
the Executive shall pay all costs and expenses, including attorney's fees and
disbursements, of Executive and the Corporation. The Corporation shall pay
prejudgment interest on any money judgment obtained by Executive as a result of
such proceeding, calculated at the rate provided in Section 1274(b)(2)(B) of the
Code.
9. Successors; Binding Agreement.
-----------------------------
(A) In addition to any obligations imposed by law
upon any successor to the Corporation, the Corporation shall require any
successor (whether direct or indirect, by purchase, merger, consolidation, or
otherwise) to all or substantially all of the business or assets of the
Corporation expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Corporation would be required to perform
it if no such succession had taken place. Failure of the Corporation to obtain
the assumption and agreement prior to the effectiveness of any succession shall
be a breach of this Agreement and shall entitle the Executive to compensation
from the Corporation in the same amount and on the same terms as the Executive
would be entitled to hereunder if the Executive were to terminate his employment
for Good Reason immediately after a Change in Control and during the term of
this Agreement, except that, for purposes of implementing the foregoing, the
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date on which any succession becomes effective shall be deemed the Payment
Trigger occasioned by the foregoing deemed termination of employment for Good
Reason immediately following a Change in Control. The provisions of this Section
9 shall continue to apply to each subsequent employer of Executive bound by this
Agreement in the event of any merger, consolidation, or transfer of all or
substantially all of the business or assets of that subsequent employer.
(B) 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. If the Executive shall die while any amount would be payable to the
Executive hereunder (other than amounts which, by their terms, terminate upon
the death of the Executive) if the Executive had continued to live, the amount,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to the executors, personal representatives, or administrators of
the Executive's estate.
10. Notices. For the purpose of this Agreement,
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notices and all other communications provided for in the Agreement shall be in
writing and shall be deemed to have been duly given when delivered or mailed by
United States registered mail, return receipt requested, postage prepaid,
addressed to the respective addresses set forth below, or to such other address
as either party may have furnished to the other in writing in accordance
herewith, except that notice of change of address shall be effective only upon
actual receipt:
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To the Corporation:
ALLTEL Corporation
Xxx Xxxxxx Xxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Chairman of the Board
To the Executive:
Xxxxxxx X. Xxx
0000 Xxxxxx Xxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
11. Miscellaneous. No provision of this Agreement
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may be modified, waived, or discharged unless such waiver, modification, or
discharge is agreed to in writing and signed by the Executive and an officer of
the Corporation specifically designated by the Board. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly set
forth in this Agreement. The validity, interpretation, construction, and
performance of this Agreement shall be governed by the laws of the State of
Delaware. All references to sections of the Exchange Act or the Code shall be
deemed also to refer to any successor provisions to such sections. Any payments
provided for hereunder shall be paid net of any applicable withholding required
under federal, state, or local law and any additional withholding to which the
Executive has agreed.
12. Validity. The invalidity or unenforceability
--------
of any provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in
full force and effect.
13. Counterparts. This Agreement may be executed
------------
in several counterparts, each of which shall be deemed to be an original but all
of which together will constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have signed this
Agreement as of the date set forth above.
ALLTEL CORPORATION
Attest:
/s/ Xxxxx X. Xxxx By/s/ Xxx X. Xxxx
----------------------------- ------------------------
Name: Xxxxx X. Xxxx Name: Xxx X. Xxxx
Title: Executive Vice President Title: Chairman and CEO
Witness:
Xxxx X. Xxxxxxxx /s/Xxxxxxx X. Xxx
----------------------------- -----------------------
Xxxx X. Xxxxxxxx Xxxxxxx X. Xxx
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