AT&T 2004 Long Term Incentive Program
Performance Share Award Agreement
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****EMPLOYEE MUST RETURNED SIGNED AGREEMENT ON OR BEFORE [date] OR THIS AWARD
WILL BECOME NULL AND VOID****
Pursuant to the AT&T 2004 Long Term Incentive Program (the "Plan") of AT&T Corp.
("AT&T" or the "Company"), and in accordance with the terms and conditions of
the Plan, a copy of which is available to you*, and your agreement to the
further terms, conditions and restrictions set forth below, you have been
granted, as of the date of grant set forth below, a number of performance shares
("Performance Shares"), as set forth below.
The Plan is hereby incorporated by reference and made a part hereof. The grant
and this Agreement are subject to all terms and conditions of the Plan, and the
parties agree to be bound by the terms thereof. In the event of any conflict
between the provisions of this Agreement and the provisions of the Plan, the
provisions of the Plan shall control. The Committee shall have the right, in its
discretion, to alter or amend the Plan and this Agreement, from time to time,
consistent with the terms of the Plan. Capitalized terms not otherwise defined
herein shall have the same meanings as in the Plan.
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Participant
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Social Security Number
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Number of Performance Shares
Granted
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Date of Xxxxx
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Performance Period
January 1, 2005 - December 31, 2007
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Your Performance Share Award will be distributed only after
the end of the Performance Period, except in certain
circumstances as indicated in the terms and conditions set
forth in this Agreement.
o The percentage of the Performance Share Award that will
be distributed to you shall depend on the satisfaction,
at the completion of the Performance Period, of
performance criteria that have been established by the
AT&T Board of Directors ("the AT&T Board") or the
Committee.
Distribution
Period and Form
of Payout
o The determination of whether, and to what extent,
such criteria have been satisfied, and the
determination of the percentage of the Performance
Share Award to be distributed to you shall be
conclusively determined by the AT&T Board or the
Committee.
o The Performance Shares to which you become entitled
based on the satisfaction of such criteria are called
("Retained Shares"). The number of Retained Shares
will be determined as soon as practicable after the
completion of the Performance Period and shall be
distributed in Shares of AT&T common stock, except in
certain circumstances as indicated in the termination
of employment provisions set forth in this Agreement.
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This Performance Share Award Agreement (this "Agreement")
Effectiveness shall be effective only if and when AT&T receives your
of Agreement signature of acceptance of the terms of this Agreement as
required below.
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As soon as administratively practicable after the completion
of the distribution period described above (the
"Distribution Period"), (or to the extent applicable, the
completion of any elected deferral period for any
Book Entry upon Performance Share), and subject to the income tax
Completion of withholding provisions described in the Agreement, AT&T
Distribution will deliver to you or your legal representative a statement
Period reflecting ownership of the corresponding Shares in book
entry form. You are responsible for complying with any
securities and exchange control laws or any other legal
requirements applicable to you in connection with the
distribution of such Shares.
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Upon the distribution of any Retained Shares, and in
accordance with ordinary payroll practices, you will receive
Dividend a cash payment in an amount equal to all dividends payable
Equivalent on one Share (subject to any appropriate adjustment pursuant
Payments to Section 4(c) of the Plan) on all record dates within the
Performance Period with respect to which this Performance
Share Award was outstanding, multiplied by the number of
Retained Shares distributed to you upon the distribution.
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You may irrevocably elect, in accordance with policies
adopted by the Committee, to defer the distribution of all
Deferral or any portion of this Performance Share Award that you
Election otherwise would have become entitled to receive upon the
conclusion of the distribution period pursuant to the terms
of this Agreement.
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* AT&T employees should access the Corporate Forms Library in the AT&T Workforce
Services web site for these documents.
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You agree that the Company is not responsible for the tax
consequences to you of the granting or distribution of this
Performance Share Award and the distribution of Shares in
respect thereof, and that it is your responsibility to
consult with a personal tax advisor regarding all matters
with respect to the tax consequences of the granting and
vesting of the Performance Shares and the distribution of
Income Tax Shares in respect thereof. At the conclusion of the
Withholding Distribution Period, AT&T (or your local employer, as
Requirements applicable) shall determine and report to the proper taxing
(Applicable to authorities the ordinary income recognized by you based on
all Participants) the number of Retained Shares to be issued to you on such
date multiplied by the Fair Market Value on such date. AT&T
(and your local employer, as applicable) shall have the
right to deduct or cause to be deducted from, or collect or
cause to be collected with respect to, any distribution of
Shares or payment of dividend equivalent amounts, any
federal, state, or local taxes and/or social insurance
contributions required by law to be withheld or paid with
respect to such distribution and or payment, and you or your
legal representative or beneficiary hereby consent to such
deductions.
Subject to applicable securities laws, AT&T (and your local
employer, as applicable) is authorized to automatically
withhold an appropriate number of Retained Shares to satisfy
such tax and/or social insurance withholding and distribute
only the net number of Shares to you.
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Termination of Your termination of employment from the Company or one of
Employment and its Affiliates, will cause this Performance Share Award to
this Performance be cancelled effective upon your termination date, except as
Share Award described below:
Agreement
normal retirement a) upon termination of employment after the attainment of
age and AT&T service equal to:
Age and AT&T service of
Any age 30 years
50 25 years
55 20 years
65 10 years;
the Performance Shares shall be prorated based on the number
of full months** of employment in the Performance Period and
distributed to you as soon as practicable following the year
of your retirement. The payout level for this Award will be
determined by the level of performance criteria met from the
beginning of the applicable Performance Period through the
end of the calendar year of your retirement.
under an FMP, b) upon termination of employment, under the AT&T Force
sale, divestiture, Management Program or the AT&T E-Band and Officer
outsourcing separation plans; sale, divestiture or outsourcing of
your business unit or position from AT&T; the
Performance Shares shall be prorated based on the
number of full months** of employment in the
Performance Period and distributed to you as soon as
practicable following the year of your termination. The
payout level for this Award will be determined by the
level of performance criteria met from the beginning of
the applicable Performance Period through the end of
the calendar year of your termination.
Disability c) upon termination of employment due to disability
entitling you to Company provided long term disability
benefits under a Company provided long term disability
plan, then this Award shall be prorated based on the
number of full months** of employment in the
Performance Period and distributed to you as soon as
practicable following the year of your termination. The
payout level for this Award will be determined by the
level of performance criteria met from the beginning of
the applicable Performance Period through the end of
the calendar year of your termination.
** Terminations on or after the 16th of a month will be
treated as occurring at the end of the month of the
proration calculation; terminations prior to the 16th of a
month will be treated as occurring at the end of the
previous month for the proration calculation. Fractional
Shares will be rounded up to the nearest whole Share.
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In the case of your death, any distribution in respect of
this Performance Share Award granted hereunder shall be made
to your estate. You may, in accordance with procedures
established by the Committee, designate one or more
beneficiaries to receive all or part of any distribution to
be made hereunder in case of your death, and you may change
or revoke such designation at any time. In the event of your
Distribution death, any distribution hereunder that is subject to such a
Upon Death designation (to the extent such designation is valid and
enforceable under applicable law) shall be made to such
beneficiary or beneficiaries in accordance with this
Agreement. If there shall be any question as to the legal
right of any beneficiary to receive a distribution
hereunder, the amount in question shall be distributed to
your estate, in which event neither AT&T nor any Affiliate
shall have any further liability to anyone with respect to
such distribution.
In case of your death prior to the end of the Performance
Period, the number of Performance Shares shall be prorated,
based on the number of full months*** of employment in the
Performance Period. The prorated Performance Shares shall be
distributed in cash (valued in accordance with procedures
established by the Committee) within a reasonable time after
your death. All other Performance Shares granted hereunder
shall be cancelled.
*** The month of death will be counted as a full month,
unless this Award was previously prorated as set forth in a,
b, or c of the Termination of Employment provisions of this
Agreement. Fractional Shares will be rounded up to the
nearest whole Share.
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Transfer to or from AT&T and any Affiliate, shall not be
Transfer or considered a termination of employment for purposes of this
Leave of Agreement. Nor shall it be considered a termination of
Absence employment for purposes of this Agreement if you are placed
on a military leave or other approved leave of absence,
unless the Committee shall otherwise determine.
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This Performance Share Award shall be forfeited and
cancelled if, prior to the distribution of this Award,
without the consent of AT&T, while employed by AT&T, or
Competition after termination of such employment, you establish a
relationship with a competitor of the Company or engage in
activity which is in conflict with or adverse to the
interest of AT&T, as determined in accordance with the AT&T
Non-Competition Guideline (the "Guideline"), a copy of which
is available to you*.
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Employment Neither the Plan nor this Agreement shall be construed as
Rights giving you the right to be retained in the employ of AT&T or
any Affiliate.
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At all times during the Performance Period (or to the extent
applicable, any elected deferral period for this Performance
Transferability Share Award), such Performance Share Award shall be
nontransferable and may not be pledged, assigned or
alienated in any way.
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You hereby explicitly and unambiguously consent to the
collection, use and transfer, in electronic or other form,
of your personal data as described in this document by and
among, as applicable, your employer and AT&T and its
Subsidiaries and its Affiliates for the exclusive purpose of
implementing, administering and managing your participation
in the Plan. You understand that AT&T and your employer hold
certain personal information about you, including, but not
limited to, your name, home address and telephone number,
date of birth, social insurance number or other
identification number, salary, nationality, job title, any
shares of stock or directorships held in AT&T, details of
all Performance Shares or any other entitlement to shares of
stock awarded, canceled, distributed or outstanding in your
favor, for the purpose of implementing, administering and
Data managing the Plan ("Data"). You understand that Data may be
Privacy transferred to any third parties assisting in the
implementation, administration and management of the Plan,
that these recipients may be located in your country, or
elsewhere, and that the recipient's country may have
different data privacy laws and protections than your
country. You authorize the recipients to receive, possess,
use, retain and transfer the Data, in electronic or other
form, for the purposes of implementing, administering and
managing your participation in the Plan, including any
requisite transfer of such Data as may be required to a
broker or other third party with whom you deposit any Shares
acquired upon distribution of the Performance Share. You
understand that Data will be held only as long as is
necessary to implement, administer and manage your
participation in the Plan. You understand that you may, at
any time, view Data, request additional information about
the storage and processing of Data, require any necessary
amendments to Data or withdraw the consents herein by
contacting in writing your local human resources
representative. You understand that withdrawal of consent
may affect your ability to realize benefits from the
Performance Shares.
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Upon a Change in Control (as defined in Section 2(e) of the
Plan), this Performance Share Award will be prorated for the
Change in number of full months within the Performance Period prior to
Control the Change in Control and distributed based upon the level
of performance achieved within such Performance Period in
accordance with Section 11(d) of the Plan.
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* AT&T employees should access the Corporate Forms Library in the AT&T Workforce
Services web site for these documents.
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You shall not have the right to vote the Shares underlying
the Performance Shares or, except as set forth above with
respect to dividend equivalents, any other rights as a
holder of Shares until such time as the Performance Shares
shall have been delivered to you.
Anything in this Agreement to the contrary notwithstanding,
if, at any time specified herein for the issuance of Shares
to you, any law, regulation or requirement of any
governmental authority having jurisdiction shall require
either the Company or you to take any action in connection
with the Shares then to be issued, the issuance of such
Shares shall be deferred until such action shall have been
taken.
Any dispute or disagreement which shall arise under, or as a
result of, or pursuant to, this Agreement shall be
determined by the Committee in its absolute and uncontrolled
discretion, and any such determination or any other
determination by the Committee under or pursuant to this
Agreement and any interpretation by the Committee of the
terms of this Agreement shall be final, binding and
conclusive on all persons affected thereby.
This Agreement may be amended by the AT&T Board of Directors
or the Committee provided that no such amendment shall
impair your rights hereunder without your consent.
Notwithstanding any other provision to the contrary herein,
the AT&T Board, if it determines in its sole discretion that
it is necessary or desirable under the circumstances, may
authorize the proration or early distribution (or a
combination thereof) of the Performance Shares in the case
of termination of the Plan.
The validity, construction and effect of this Agreement
shall be determined in accordance with the laws of the State
of New York and applicable Federal law.
Notwithstanding any other provisions contained in this
Agreement, the following provisions shall apply to any
Participant who is a "covered employee" within the meaning
Other of Section 162(m) of the Code (i.e., the CEO and four most
Corporate highly compensated officers of the Company, other than the
Provisions CEO, as of the end of the Performance Period):
(a) The Awards to all such Participants who are
"covered employees" shall be Other Stock Unit Awards having
a total value as of the end of the Period equal to 0.13% of
the "Net Cash Provided by Operating Activities," as publicly
disclosed in the Company's consolidated financial statements
for each year in the Performance Period, adjusted by the
percentage change in the Fair Market Value of a Share from
the first trading day to the last trading day in the
Performance Period, and the value of the Award to each
Participant with respect to such Performance Period, as of
the end of the Performance Period, shall be such total value
divided by the number of Participants who are "covered
employees" as of the end of such Performance Period, subject
to adjustment as described in (b) below. "Fair Market Value"
of a Share on the applicable trading day shall be the
average of high and low per Share sale prices on the New
York Stock Exchange on such day. Prior to the payment of any
Award to a "covered employee" with respect to a Performance
Period, the Committee shall certify the amounts under this
paragraph (a) with respect to such Performance Period.
(b) The Committee, in its sole discretion, shall have
the authority to set the actual Other Stock Unit Award to
any Participant at any amount lower than the amount
described in paragraph (a) above, based on factors,
including but not limited to the financial and other
criteria of the Company established by the Committee, and
individual merit. The Other Stock Unit Award to any
Participant may have a value less than (including no award),
but never more than, the value determined under (a) above.
(c) The value of the actual Other Stock Unit Award
payable to any Participant shall be distributed in cash
and/or Shares as determined by the Committee.
Notwithstanding any other provisions contained in this
Agreement, the Committee, at the time of the distribution
may elect in its sole discretion to substitute a cash
payment in lieu of all or any portion of the Shares.
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Please indicate your acceptance of the terms of this Performance Share Award
Agreement and acknowledge that you have reviewed copies of the Plan and the
Guideline summary, in each case as currently in effect and available to you*, by
signing at the place provided and returning original of this Performance Share
Award Agreement. IF YOU FAIL TO SIGN AND RETURN THIS DOCUMENT, ACCEPTING THE
TERMS OF THIS AWARD AGREEMENT FOR ANY REASON WHATSOEVER ON OR BEFORE [date], YOU
WILL BE DEEMED TO HAVE REJECTED YOUR PERFORMANCE SHARE AWARD AND YOUR AWARD WILL
BE NULL AND VOID.
ACCEPTED AND AGREED:
/s/ Xxxxxx Xxxxxxxx-Xxxx
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Xxxxxx Xxxxxxxx-Xxxx
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AT&T Corp. Employee Signature
* AT&T employees should access the Corporate Forms Library in the AT&T Workforce
Services web site for these documents.
