AGREEMENT
THIS AGREEMENT is made and entered into this 24th day of February,
2004, by and between BellSouth Corporation, a Georgia corporation ("Company"),
and Xxxx X. Xxxxxxx ("Executive") (each, a "Party" and, collectively, the
"Parties"):
REASONS FOR THIS AGREEMENT. Executive previously served as Company's President -
Wireless Services, having overall responsibility for Company's domestic mobile
wireless voice and data businesses. Company and SBC Communications Inc. ("SBC")
combined their respective domestic mobile wireless voice and data services
businesses in 2000 into the newly-formed entities Cingular Wireless LLC and
Cingular Wireless Management Corp. (collectively "Cingular"). In connection with
the formation of Cingular, Executive left Company's employ and joined Cingular
as its Chief Operating Officer. On December 31, 2003, Executive separated from
employment with Cingular and returned to work for Company, effective as of
January 1, 2004, as its Chief Staff Officer. In this capacity, Executive reports
to Company's Chief Executive Officer and has overall responsibility for the
following functions: Advertising and Public Relations; the Corporate Secretary,
Corporate Compliance, Audit and Real Estate; Strategic Planning and Development,
and Mergers and Acquisitions; Diversity; Intellectual Property; and Corporate
Aviation; and such different or additional responsibilities as may be assigned
to Executive by Company's Board of Directors from time to time.
In connection with Executive's return to Company, Executive and Company
entered into an agreement dated December 16, 2003, that described certain
long-term performance awards to which Executive is entitled and certain
supplemental payments to which Executive may become entitled (both, in
replacement of long-term compensation awards from Cingular that were forfeited
upon Executive's termination of employment with Cingular) as an employment
inducement, that acknowledged and confirmed certain rights and entitlements of
Executive under Company non-qualified executive benefit and compensation plans,
that coordinated transition of Executive's benefits from Cingular to Company and
that provided severance protection in the event Executive's employment is
terminated under certain circumstances. That agreement also imposed certain
reasonable restrictions on Executive's activities designed to protect Company's
legitimate business interests and Confidential Information. Executive and
Company now desire to amend and restate, and replace in its entirety, the prior
agreement with this Agreement.
Executive acknowledges that Company and Affiliated Companies have
disclosed or made available and in the future will disclose and make available
Confidential Information to Executive, which could be used by Executive to
Company's or Affiliated Companies' detriment. In addition, in connection with
his employment, Executive has developed and in the future will develop important
relationships and contacts with employees and customers valuable to Company and
Affiliated Companies.
Executive further acknowledges that the covenant not to compete and
other restrictive covenants in this Agreement are fair and reasonable, that
enforcement of the provisions of this
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Agreement will not cause him undue hardship, and that the provisions of this
Agreement are reasonably necessary and commensurate with the need to protect
Company and Affiliated Companies and their business interests and property from
irreparable harm.
AGREEMENT. In consideration of the mutual promises contained in this
Agreement including, among other things, substantial additional compensation and
benefits to Executive, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Executive and Company agree as
follows:
1. EFFECTIVE DATE. This Agreement shall be effective as of
January 1, 2004.
2. SPECIAL LONG-TERM AWARDS RELATED TO FORFEITED CINGULAR
LONG-TERM COMPENSATION. As an inducement to Executive to return to work with
Company, and in replacement of certain long-term compensation that Executive
forfeited upon termination of employment with Cingular, Company has, as of the
Effective Date (or as soon as administratively practicable thereafter), made the
following long-term grants pursuant to the terms of the Stock Plan to Executive.
(a) RESTRICTED SHARES AWARD. Company granted to Executive
an award of twenty-nine thousand three hundred (29,300) Restricted Shares (as
such term is defined in the Stock Plan) with a vesting date of December 31,
2005, and subject to additional terms and conditions identical or substantially
similar to those applicable to standard Restricted Shares awards made to
similarly situated Company executives under Company's 2003 long-term
compensation program for officers.
(b) STOCK OPTIONS AWARD. Company granted to Executive one
hundred eighty-four thousand four hundred (184,400) Non-Qualified Stock Options
(as such term is defined in the Stock Plan) at Fair Market Value (as such term
is defined in the Stock Plan) on the grant date, and subject to additional terms
and conditions identical or substantially similar to those applicable to
standard Non-Qualified Stock Options awards made to Company executives under
Company's 2003 long-term compensation program for officers.
(c) PERFORMANCE SHARES AWARDS. Company granted to
Executive: (i) seventeen thousand one hundred (17,100) Performance Shares (as
such term is defined in the Stock Plan), subject to terms and conditions
identical or substantially similar to those applicable to standard Performance
Shares awards made to Company executives under Company's 2002 long-term
compensation program for officers; and (ii) twenty-nine thousand three hundred
(29,300) Performance Shares subject to terms and conditions identical or
substantially similar to those applicable to standard Performance Shares awards
made to Company executives under Company's 2003 long-term compensation program
for officers.
Nothwithstanding anything to the contrary in the
Stock Plan or a grant agreement with respect to the awards described in
subsections (a), (b) and (c) above of this Section 2, in the event that
Executive's employment is terminated under circumstances described in Section 8
of this Agreement prior to the date(s) on which any such award otherwise vests,
each
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such award shall be immediately vested, such that (i) non-vested Non-Qualified
Stock Options immediately become exercisable and remain exercisable for their
full original term, (ii) restrictions on non-vested Restricted Shares are
removed and such shares are released to Executive, and (iii) non-vested
Performance Shares remain outstanding and pay-out in such amounts and at such
times as payments would have made had Executive's employment not terminated.
3. SUPPLEMENTAL EQUITY AWARDS RELATED TO FORFEITED CINGULAR
LONG-TERM COMPENSATION. In connection with the long-term compensation awards
from Cingular that were forfeited upon termination of Executive's Cingular
employment, in addition to the special long-term awards made to Executive under
Section 2 of this Agreement, Executive shall be entitled to awards of shares of
Company common stock, par value $1 per share ("Company common stock"), as
described below in this Section 3.
(a) As of March 1, 2005, Company shall award to
Executive:
(i) a number of shares of Company common stock
determined by dividing two hundred sixty two
thousand eight hundred seven and 93/100
dollars ($262,807.93) by the Fair Market
Value of a share of Company common stock on
such date, rounded to the next highest full
share; provided, however, that if the Fair
Market Value of a share of Company common
stock on March 1, 2005, is less than $28.24,
the numerator described above shall instead
equal the product of (A) the amount by which
such Fair Market Value exceeds $22.46,
multiplied by (B) 45,468.5l; plus
(ii) a number of shares of Company common stock
determined by dividing two hundred twenty
five thousand two hundred eighty-one and
16/100 ($225,281.16) by the Fair Market
Value of a share of Company common stock on
such date, rounded to the next highest full
share; provided, however, that if the Fair
Market Value of a share of SBC common stock
on March 1, 2005, is less than $26.19, such
payment shall instead equal the product of
(A) the amount by which such Fair Market
Value exceeds $21.38, multiplied by (B)
46,836.
(b) As of March 1, 2006, Company shall award to
Executive:
(i) a number of shares of Company common stock
determined by dividing two hundred sixty two
thousand eight hundred seven and 93/100
dollars ($262,807.93) by the Fair Market
Value of a share of Company common stock on
such date, rounded to the next highest full
share; provided, however, that if the Fair
Market Value of a share of Company common
stock on March 1, 2006, is less than $28.24,
the numerator described above shall instead
equal the
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product of (A) the amount by which such Fair
Market Value exceeds $22.46, multiplied by
(B) 45,468.5; plus
(ii) a number of shares of Company common stock
determined by dividing two hundred twenty
five thousand two hundred eighty-one and
16/100 dollars ($225,281.16) by the Fair
Market Value of a share of Company common
stock on such date, rounded to the next
highest full share; provided, however, that
if the Fair Market Value of a share of SBC
common stock on March 1, 2006, is less than
$26.19, the numerator described above shall
instead equal the product of (A) the amount
by which such Fair Market Value exceeds
$21.38, multiplied by (B) 46,836.
(c) Notwithstanding the foregoing, in the event that
Executive's employment is terminated under circumstances described in Section 8
below prior to one or both of the award dates described above, Executive's
entitlement to any such awards not previously made, and the amount of any such
payment, shall be determined as of Executive's termination of employment instead
of the date(s) specified above.
(d) The awards of Company common stock, if any, to be
made under this Section 3 shall be made in unrestricted shares, delivered to
Executive net of all applicable withholdings, as soon as practicable following
the date specified above as of which entitlement to each such award arises.
4. 2003 BONUS. Company shall pay to Executive the amount, if any,
by which (a) the standard award applicable to Executive under Cingular's
short-term bonus plan for 2003 multiplied by the greater of (i) one hundred
percent (100%) or (ii) the percentage payable under the bonus plan based on
actual performance results for the year, exceeds (b) the amount actually paid to
Executive by Cingular under its bonus plan for 2003. The payment described in
this Section 4 shall be made in a single lump sum as soon as administratively
practicable after the date on which Cingular makes payment to its officers for
2003 under its bonus plan and shall be subject to all applicable withholdings.
5. EXECUTIVE BENEFITS.
(a) All benefits of Executive accrued prior to the
Effective Date under the BellSouth Corporation Nonqualified Deferred
Compensation Plan, the BellSouth Nonqualified Deferred Income Plan, the
BellSouth Corporation Supplemental Executive Retirement Plan, the BellSouth
Split-Dollar Life Insurance Plan and the BellSouth Supplemental Life Insurance
Plan shall be and remain fully vested and nonforfeitable, and shall be
determined as if Executive upon termination of employment with Cingular had been
eligible for a service pension under the terms and conditions of the BellSouth
Personal Retirement Account Pension Plan.
(b) All benefits of Executive accrued on or after the
Effective Date under the plans referenced in Section 5(a) above and under all
other non-qualified executive compensation and benefit plans of Company
(including those adopted or amended from time to time hereafter)
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shall not be subject to the provisions of Section 5(a) above, but (to the extent
permitted by applicable law) shall be determined as if Executive's period of
employment with Cingular had been a period of employment with Company, and shall
be offset by the amount of any compensation or benefits payable to Executive
under a similar type plan of Cingular.
6. SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN. In the event that
either (i) Executive remains in the continuous employ of Company (or of a
related entity to which Executive may have been assigned by Company) through
December 31, 2008, or (ii) Executive's employment is terminated under
circumstances described in Section 8 below, Executive shall entitled to benefits
under the BellSouth Corporation Supplemental Executive Retirement Plan ("SERP")
determined by adding ten (10) years to Executive's Vesting Service Credit (as
such term is defined in SERP) as of the date Executive's employment terminates.
7. TERMINATION ALLOWANCE. In the event Executive's employment is
terminated under circumstances described in Section 8 below, Company shall pay
to Executive (or, in the event of Executive's death, to his estate) a
termination allowance. The termination allowance shall be an amount equal to the
sum of (a) two hundred percent (200%) of Executive's Base Salary in effect on
the date of Executive's termination of employment, plus (b) two hundred percent
(200%) of the standard award amount applicable to Executive under the BellSouth
Short Term Incentive Award Plan for the year in which his date of termination
occurs, less all applicable withholdings, payable in a single lump sum payment.
Payment of the termination allowance shall be made as soon as practicable
following Executive's termination of employment under circumstances entitling
him to such payment, and satisfaction of all conditions described in this
Agreement on Executive's entitlement to such payment. For purposes of this
Agreement, "Base Salary" shall refer to the gross annual base salary payable to
Executive including (i) the amounts of any before-tax contributions made by
Executive from such salary to the BellSouth Retirement Savings Plan, or any
other tax-qualified cash or deferred arrangement sponsored by Company, and (ii)
the amount of any other deferrals of such salary under any nonqualified deferred
compensation plan(s) maintained by Company.
8. RELEVANT CIRCUMSTANCES. Executive's employment shall be deemed
to have been terminated under circumstances described in this Section 8 only if:
(a) Executive's employment is terminated (and Executive
is not transferred to or reemployed by an Affiliated Company) (1) by Company,
other than for Cause, or (2) by Executive for Good Reason, and Executive
executes a release satisfying the terms of Section 9(b) of this Agreement;
(b) Executive's employment is terminated by reason of
Executive's Disability, and Executive executes a release satisfying the terms of
Section 9(b) of this Agreement; or
(c) Executive's employment is terminated by reason of
Executive's death.
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9. DISCHARGE AND WAIVER.
(a) Executive fully releases and forever discharges
Company and Affiliated Companies, and any employee, officer, director,
representative, agent, successor or assign of Company and Affiliated Companies
(both in their personal and official capacities), and all persons acting by,
through and under or in concert with any of them, from any and all claims,
demands, causes of action, remedies, obligations, costs and expenses of whatever
nature, whether under the common law, state law, federal law (including but not
limited to the Age Discrimination in Employment Act of 1967) or otherwise,
through the date of this Agreement, including those arising from or in
connection with the terms and conditions of employment with Company (and
Affiliated Companies; provided, however, that this release shall not apply to
any rights Executive may have under articles, by-laws or other agreements by or
with respect to Company or its affiliates or any rights Executive may have with
respect to directors' and officers' liability insurance or other errors and
omissions insurance policies maintained by Company or any of its affiliates.
This paragraph is not intended to and shall not affect benefits to which
Executive may be entitled under any pension, savings, health, welfare, or other
benefit plan in which Executive is a participant.
(b) Furthermore, Company's obligations under this
Agreement upon termination of Executive's employment, and Executive's
entitlement to any such benefits, are expressly conditioned upon execution by
Executive, upon termination of his employment, of a release agreement
substantially in the form of the release agreement attached to this Agreement as
Exhibit "A," which is incorporated herein by this reference.
10. COVENANT NOT TO XXX. Executive covenants and agrees not to
make or file any claim, demand or cause of action or seek any remedy of whatever
nature, whether under the common law, state law, federal law or otherwise,
arising from or in connection with the matters discharged and waived in Section
9, above. Notwithstanding the foregoing, in the event Executive files a charge
or lawsuit under the Age Discrimination in Employment Act of 1967 ("ADEA") and
thereby challenges the validity of the release described in Section 9, such
charge or lawsuit will not be considered a breach of this Section 10.
11. CONFIDENTIAL INFORMATION. Executive agrees to protect
Confidential Information from misuse or unauthorized disclosure. In addition to
complying with all applicable laws governing trade secret and confidential
information disclosure, Executive will not (i) use, except in connection with
work for Company or Affiliated Companies, or threaten to use, or (ii) disclose,
communicate or give others access to (orally, in writing, electronically or
digitally) or threaten to disclose, communicate or give other access to any
Confidential Information. For purposes of this Agreement, "Confidential
Information" shall mean information, whether generated internally or externally,
whether in written, oral, digital, electronic or any other form or format,
relating to Company's or Affiliated Companies' businesses that 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
6
models), techniques, drawings, processes, employee compensation data, and
financial data (including marketing information and strategies and personnel
data). For purposes of this Agreement, Confidential Information does not include
information that is not a trade secret three (3) years after termination of
Executive's employment with Company, but shall continue to include trade secrets
as long as information remains a trade secret under applicable law. Executive
acknowledges that any use of, reliance upon, disclosure or other
misappropriation of Confidential Information inconsistent with the terms of this
Agreement (including without limitation acceptance by Executive of a position in
which the inevitability of such use, reliance, disclosure or misappropriation is
reasonably anticipated) would result in material and irreparable damage and
injury to Company or Affiliated Companies.
12. LIMITATION ON COMPETITION. In consideration of the additional
payments, benefits and other rights that are being provided to Executive under
this Agreement, while employed by Company or an Affiliated Company, and during
the one (1) year after any termination of his employment, Executive agrees not
to provide any "Services" (as defined in the third paragraph of this Section 12
to any Person that competes directly with Company or Affiliated Companies,
whether Executive provides the Services as an employee, consultant, independent
contractor, advisor or director. After the termination of Executive's
employment, the foregoing covenant shall restrict Executive's actions only with
respect to competition in the Territory.
For purposes of this Agreement, the term "Territory" shall mean the
geographical territory consisting of those counties and parishes in the states
of Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina,
South Carolina and Tennessee listed on Exhibit "B" attached hereto and
incorporated by reference herein, which the Parties acknowledge represents
geographical territories in which Executive, as of the Effective Date, has
responsibility for providing Services to Company and Affiliated Companies. The
Parties also acknowledge that the entire Territory consists of geographical
territories in which Company and Affiliated Companies, directly or indirectly,
are conducting business on the Effective Date. In an effort to impose reasonable
limitations on the scope of the Territory, Company has not required that
Executive comply with the covenant in this Section 12 in all geographical areas
where the Company and Affiliated Companies are licensed to conduct business and
are conducting business, even though the Parties acknowledge that Executive is
performing Services throughout that entire area. Executive agrees that because
of the widespread nature of Company's business and the fact that, as one of the
most senior executives in the Company Executive's employment responsibilities
extend to all areas where Company and Affiliated Companies operate, Executive's
engaging in competitive activity anywhere in the Territory would irreparably
injure Company or Affiliated Companies and that, therefore, a more limited
geographic restriction is neither feasible nor appropriate.
For purposes of this Agreement, the term "Services" shall mean services
which Executive as of the Effective Date is responsible for providing to Company
and Affiliated Companies, which Executive acknowledges consists of providing
management, administrative and advisory services related to business planning
and operations with respect to the communications services business, consisting
of wireline (local exchange, exchange access and intraLATA toll)
7
telecommunications services, systems and products, wireless (cellular, personal
communications service, and mobile data) communications services, systems and
products, electronic commerce or communications (internet and web based
applications), data transmission and networking, entertainment services, systems
and products, paging services, systems and products, and telecommunications
directory advertising and publishing.
Executive represents and warrants that Executive's education, training
and experience are such that this Section 12 will not jeopardize or
significantly interfere with Executive's ability to secure other gainful
employment.
13. LIMITATION ON SOLICITATION OF COMPANY PERSONNEL. In
consideration of the additional payments, benefits and other rights that are
being provided to Executive under this Agreement, while employed by Company or
an Affiliated Company and during a period of two (2) years after any termination
of his employment, Executive will not, directly or indirectly, induce or solicit
any employee or other personnel, director, advisor or independent contractor of
Company or any Affiliated Company to sever his or its relationship with Company
or the Affiliated Company, or recruit or attempt to recruit such parties to
enter into a substantially similar relationship with another business; provided,
however, that after termination of Executive's employment this restriction shall
apply only to parties with whom Executive had material contact within two (2)
years prior to the termination of his employment. However, Executive may hire or
otherwise engage on behalf of himself or on behalf of any company or entity any
party who terminated his or its relationship with the Company or an Affiliated
Company without any inducement or attempted inducement or solicitation by
Executive.
14. LIMITATION ON SOLICITATION OF CUSTOMERS. In consideration of
the additional payments, benefits and other rights that are being provided to
Executive under this Agreement, during the period of eighteen (18) months after
any termination of his employment, Executive will not solicit or induce,
directly or indirectly, any Customers for the purpose of providing products or
services within the Territory that Company or Affiliated Companies provide. For
purposes of this Agreement, "Customers" shall mean actual (or actively and
directly sought prospective) customers, suppliers, and retailers of Company or
Affiliated Companies in the Territory (1) with whom Executive dealt, directly or
indirectly, on behalf of Company or Affiliated Companies, or (2) whose dealings
with Company or Affiliated Companies were coordinated or supervised by
Executive.
15. INTERPRETATION; SEVERABILITY OF INVALID PROVISIONS. Executive
acknowledges and agrees that the limitations described in this Agreement,
including specifically the limitations upon his activities, are reasonable in
scope, are necessary for the protection of Company's and Affiliated Companies'
business, and form an essential part of the consideration for which this
Agreement has been entered into. It is the intention of the Parties that the
provisions of this Agreement be enforced to the fullest extent permissible under
applicable laws and public policies. Nonetheless, the rights and restrictions
contained in this Agreement may be exercised and shall be applicable and binding
only to the extent they do not violate any applicable laws and are intended to
be limited to the extent necessary so that they will not render this Agreement
illegal,
8
invalid or unenforceable. If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, the remaining provisions shall remain in full
force and effect. The provisions of this Agreement do not in any way limit or
abridge Company's or Affiliated Companies' rights under the laws of unfair
competition, trade secret, copyright, patent, trademark or any other applicable
law(s), all of which are in addition to and cumulative of Company's or
Affiliated Companies' rights under this Agreement. Executive agrees that the
existence of any claim by Executive against Company or any Affiliated Company,
whether predicated on this Agreement or otherwise, shall not constitute a
defense to enforcement by Company or any Affiliated Company of any or all of
such provisions or covenants.
16. RELIEF.
(a) The Parties acknowledge that a breach or threatened
breach by Executive of any of the terms of this Agreement would result in
material and irreparable damage and injury to Company or Affiliated Companies,
and that it would be difficult or impossible to establish the full monetary
value of such damage. Therefore, Company and Affiliated Companies shall be
entitled to injunctive relief in the event of Executive's breach or threatened
breach of any of the terms contained in this Agreement. In the event of any
breach or threatened breach of this Agreement by Executive, if Company or any
Affiliated Company should employ attorneys or incur other expenses for the
successful enforcement of any obligation or agreement of Executive contained
herein, Executive agrees that, on demand and to the extent permitted by law,
Executive shall reimburse Company or the Affiliated Company for its reasonable
attorneys' fees and such other reasonable expenses so incurred.
(b) In the event that Executive fails to comply with the
terms of Section 11, Section 12, Section 13 or Section 14 of this Agreement,
then, in addition to all other rights and remedies available to Company and
Affiliated Companies under this Agreement or at law or in equity:
(i) all amounts otherwise payable by Company or
an Affiliated Company to (or on behalf of)
Executive pursuant to the terms of this
Agreement for periods subsequent to the date
of such failure shall be forfeited and
Company and Affiliated Companies shall cease
to be under any further obligation to
Executive with respect to the compensation
and benefits described in this Agreement;
(ii) Executive shall refund to Company promptly
any and all amounts previously paid to or on
behalf of Executive pursuant to the terms of
this Agreement for periods subsequent to the
occurrence of such failure; and
(iii) Executive shall promptly return to Company
all shares of Company's common stock
delivered to Executive pursuant to the
Restricted Shares award described in Section
2(a) of this Agreement plus, if any of such
shares shall have been
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previously disposed of, a cash amount equal
to the proceeds from such disposition (or
the fair market value of such shares on the
date of such disposition, if disposed of for
less than fair market value).
17. ARBITRATION. Except for the right to seek temporary restraint
or interim injunctive relief from a court of competent jurisdiction (as provided
in Section 16), any dispute, controversy or claim arising out of or relating to
this Agreement, or the breach, termination or invalidity of any provision hereof
(collectively, a "Claim") shall be settled by arbitration pursuant to the
National Rules for the Resolution of Commercial Disputes of the American
Arbitration Association. Any such arbitration shall be conducted by one
arbitrator, with experience in the matters covered by this Agreement, mutually
acceptable to the Parties. If the Parties are unable to agree on the arbitrator
within thirty (30) days of one party giving the other party written notice of
intent to arbitrate a Claim, the American Arbitration Association shall appoint
an arbitrator with such qualifications to conduct such arbitration. The decision
of the arbitrator in any such arbitration shall be conclusive and binding on the
Parties. Any such arbitration shall be conducted in Atlanta, Georgia.
The Parties indicate their acceptance of the foregoing arbitration
requirement by initialing below:
/s/ RDS /s/ MLF
-------------- -----------
Company Executive
18. AGREEMENT BINDING. This Agreement shall be binding upon and
inure to the benefit of Company and Affiliated Companies, and their successors,
assignees, and designees, and Executive and Executive's heirs, executors,
administrators, personal representatives and assigns.
19. ENTIRE AGREEMENT; PREVIOUS AGREEMENT. This Agreement and all
exhibits to this Agreement (which are incorporated into the Agreement by
reference) contain the entire agreement between the Parties and no statements,
promises or inducements made by either Party, or agent of either Party, which
are not contained in this Agreement shall be valid or binding; provided,
however, that the matters dealt with herein supersede the terms of Company
benefit plans and agreements between the Parties entered into pursuant to such
plans only to the extent the provisions of such plans and related agreements are
inconsistent with this Agreement and other provisions of such plans and related
agreements not inconsistent with this Agreement are not affected. This Agreement
may not be enlarged, modified or altered except in writing signed by the
Parties.
20. NONWAIVER. The failure of Company or any Affiliated Companies
to insist upon strict performance of the terms of this Agreement, or to exercise
any option herein, shall not be construed as a waiver or a relinquishment for
the future of such term or option, but rather the same shall continue in full
force and effect.
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21. NOTICES. All notices, requests, demands and other
communications required or permitted by this Agreement or by any statute
relating to this Agreement shall be in writing and shall be deemed to have been
duly given if delivered or mailed, first-class, certified mail, postage prepaid,
addressed to Company or Executive at the address reflected a Exhibit "C"
attached hereto and incorporated herein by this reference.
22. NONDUPLICATION. Notwithstanding any other provisions of this
Agreement, if Executive becomes entitled to benefits under Article III of the
CIC Agreement, the severance benefits described in Article III(a) of the CIC
Agreement shall be in lieu of any termination allowance to which Executive is
otherwise entitled under Section 7 of this Agreement. Except as otherwise
specifically provided in this Section 22, both this Agreement and the CIC
Agreement shall continue in full force and effect, and Article X(e) of the CIC
Agreement shall be interpreted consistently herewith.
23. NONDISCLOSURE. Executive shall not disclose the existence or
terms of this Agreement to any third party (excluding Executive's spouse and
children), except to receive advice of legal counsel, financial advisors or tax
advisors (who shall also be required to maintain its confidentiality) or to
comply with any statutory or common law duty; provided that these restrictions
on disclosure shall not apply to the extent that the existence of this Agreement
are disclosed by Company or any Affiliated Company as part of its periodic
public filings and disclosures or otherwise.
24. EMPLOYMENT RIGHTS. Company and Executive mutually acknowledge
and agree that this Agreement is not intended to and shall not bind either party
to an employment relationship of any fixed or minimum duration such that, in the
absence of an express written agreement to the contrary, Executive's employment
is "at will" and either party shall have the right to terminate the employment
relationship for any reason and at any time. Furthermore, Executive shall be
subject to the same general terms and conditions of employment as other Company
employees.
25. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall constitute an original and all of which, when
taken together, shall constitute one agreement.
26. GOVERNING LAW. This Agreement shall be construed under and
governed by the laws of the State of Georgia. Executive has been advised to
consult with an attorney, acknowledges having had ample opportunity to do so and
fully understands the binding effect of this Agreement. In this regard,
Executive acknowledges that a copy of this Agreement was provided to Executive
for review and consideration for up to twenty-two (22) days. Further, Executive
understands that this Agreement may be revoked by Executive within seven (7)
days from the date of execution of this Agreement. Executive further
acknowledges that he is a sophisticated businessperson and that given his
opportunity to review, negotiate and reject this Agreement, has bargaining power
equal to that of the Company. Therefore, the provisions of this Agreement shall
not be construed against Company.
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27. DEFINITIONS. For purposes of this Agreement, the following
terms shall have the meaning specified below:
(a) "AFFILIATED COMPANIES" - shall mean those
subsidiaries and affiliates of Company listed on Exhibit "D" attached hereto and
incorporated herein by this reference and any direct successors to those
companies through acquisition or merger or by way of name change.
(b) "BASE SALARY" - shall have the meaning ascribed to
such term in Section 7 of this Agreement.
(c) "CAUSE" - shall mean Executive's (i) engaging in an
act (or acts) of willful dishonesty involving Company or Affiliated Companies or
their business(es) that is demonstrably injurious to Company or Affiliated
Companies; (ii) refusal or willful failure to follow reasonable instructions of
Company's Chief Executive Officer or Board of Directors; or (iii) conviction of
a crime classified as a felony.
(d) "CIC AGREEMENT" - shall mean the Executive Severance
Agreement to be entered into by and between Executive and Company effective as
of the Effective Date (in substantially the form attached hereto as Exhibit
"E"), providing certain benefits in the event of a change in corporate control
of Company, as amended from time to time.
(e) "CONFIDENTIAL INFORMATION" - shall have the meaning
ascribed to such term in Section 11 of this Agreement.
(f) "CUSTOMERS" - shall have the meaning ascribed to such
term in Section 14 of this Agreement.
(g) "DISABILITY" - shall mean an illness, injury or other
incapacity which qualifies Executive for long-term disability benefits under the
principal management long-term disability plan of Company.
(h) "EFFECTIVE DATE" - shall have the meaning ascribed to
such term in Section 1 of this Agreement.
(i) "FAIR MARKET VALUE" - shall mean for any day, the
average of the high and low daily sale prices of a share of Company or SBC (as
the case may be) common stock on the New York Stock Exchange for that day or, if
there are no sales on such day, for the most recent prior day on which a share
of Company or SBC (as the case may be) common stock was sold; provided, however,
that such price(s) shall be adjusted as appropriate in order to prevent dilution
or enlargement of Executive's entitlements as a result of a corporate
transaction or transactions (including without limitation recapitalizations,
forward or reverse splits, reorganizations, mergers, consolidations, spin-offs,
dividends or other distributions, repurchases or share exchanges) involving
Company or SBC (as the case may be).
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(j) "GOOD REASON" - shall mean the occurrence, without
Executive's express written consent, of any of the following circumstances: (i)
diminution in the status or responsibilities of Executive's position, involving
assignment of Executive to a lower compensation band, from those which existed
immediately prior to such diminution; (ii) a reduction in Executive's Base
Salary as in effect immediately prior to such reduction or the failure to pay a
bonus award to which Executive is otherwise entitled under any of the short term
or long term incentive plans in which Executive is otherwise entitled under any
of the short term or long term incentive plans in which Executive participates
(or any successor incentive compensation plans) at the time such awards are
usually paid; (iii) Executive becoming entitled to types or amounts of other
compensation and benefits which are materially less (or materially less
valuable) than the types or amounts of such compensation and benefits provided
to other similarly situated officers; or (iv) a change in the principal place of
Executive's employment requiring relocation outside the Atlanta, Georgia
metropolitan area.
(k) "PERSON" - shall mean any individual, corporation,
limited liability entity, bank, partnership, joint venture, association, joint
stock company, trust, unincorporated organization, governmental or other legal
or business entity.
(l) "SERP" - shall have the meaning ascribed to such term
in Section 6 of this Agreement.
(m) "SERVICES" - shall have the meaning ascribed to such
term in Section 12 of this Agreement.
(n) "STOCK PLAN" - shall mean the Amended and Restated
BellSouth Corporation Stock Plan, Effective April 24, 1995, As Amended.
(o) "TERRITORY" - shall have the meaning ascribed to such
term in Section 12 of this Agreement.
IN WITNESS WHEREOF, Company has caused this Agreement to be executed by
its duly authorized representative, and Executive has executed this Agreement,
as of the date written above.
EXECUTIVE: BELLSOUTH CORPORATION:
Xxxx X. Xxxxxxx By: /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------- ------------------------------------
XXXX X. XXXXXXX Title: VP - Human Resources
---------------------------------
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