AGREEMENT
Exhibit
(10)(c)(4)
This
Agreement, dated January 18, 2006, is made by and between ALLTEL Corporation,
a
Delaware corporation (as hereinafter defined, the "Corporation"), and Xxxxxxxx
Xxxxxxx (as hereinafter defined, the "Executive").
WHEREAS,
the
Corporation 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
Corporation desires to encourage the continued employment of the Executive
by
the Corporation or a Subsidiary and the continued dedication of the Executive
to
the Executive's 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, the following terms shall have the meanings
indicated below:
(A) "ALLTEL
Group" shall mean, collectively, the Corporation and each Subsidiary of the
Corporation from time to time, and a "member" of the ALLTEL Group shall mean
the
Corporation or any of such entities.
(B) "Board"
shall mean the Board of Directors of the Corporation, as constituted from time
to time.
(C) "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 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, or (iii) a breach by
the
Executive of any of the Executive's covenants set forth in Section 7. For
purposes of clause (i) and clause (ii) 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.
(D) 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) The
consummation of (A) a merger or consolidation of the Corporation, statutory
share exchange, or other similar transaction 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.
(E) "Code"
shall mean the Internal Revenue Code of 1986, as amended from time to
time.
(F) "Continuing
Directors" means directors who were directors of the Corporation at the
beginning of the 12-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.
(G) "Corporation"
shall mean ALLTEL Corporation and any successor to its business or assets,
by
operation of law or otherwise.
(H) "Date
of
Termination" shall have the meaning stated in paragraph (B) of Section 6
hereof.
(I) "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 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.
(J) "Executive"
shall mean the individual named in the first paragraph of this
Agreement.
(K) "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) 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
Corporation's requiring the Executive to be based more than 35 miles from the
location of the Executive's principal office immediately prior to the Change
in
Control, 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) if
the
Executive was based at the principal executive offices of the Corporation or
of
a Subsidiary, as the case may be, immediately prior to the Change in Control,
the Corporation's requiring the Executive to be based anywhere other than the
principal executive offices of the Corporation or 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;
(v) 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 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 the Executive for required business
travel;
(vi) 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;
(vii) 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
(viii) 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.
(L) "Notice
of Termination" shall have the meaning stated in paragraph (A) of Section 6
hereof.
(M) "Payment
Trigger" shall mean the occurrence of a Change in Control during the term of
this Agreement coincident with or followed 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.
(N)
"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.
(O) "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.
2.
Term
of Agreement.
This
Agreement shall become 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) the reassignment of
the
Executive prior to a Change in Control to any position with the Corporation
whose job grade or classification is less than 90 (or its equivalent in the
event the Corporation’s job classification system is changed after the date of
this Agreement), (iii) 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, (iv) any date the Corporation may, in its sole and
absolute discretion, designate which is on or after the third year anniversary
of the date on which notice in writing is given by ALLTEL to the Executive
in
accordance with Section 11 that this Agreement will so terminate (hereinafter,
the "Nonrenewal Date"), if, as of the Nonrenewal Date, a Change in Control
shall
not have occurred and be continuing, or (v) in the event, as of the Nonrenewal
Date, 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.
3.
General
Provisions.
(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 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. The Corporation shall
not
at any time assert that any provision of this Agreement is invalid or
unenforceable in any respect or to any extent, irrespective of the outcome
of
any action, suit, or proceeding.
(B) No
amount
or benefit shall be payable under Section 4 or Section 5 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. 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 and shall not limit, reduce or
terminate any of the Executive’s rights or benefits under this
Agreement.
(C) This
Agreement shall not be construed as creating an express or implied contract
of
employment, and, except to the extent (if any) 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 and
the
Corporation and any Subsidiary may in its sole and absolute discretion at any
time terminate the Executive's employment for any reason (but the Corporation
shall be obligated, subject to the provisions of this Agreement, to make the
payments described in Section 4 and Section 5 if a Payment Trigger occurred
during the term of this Agreement, including, without limitation, a Payment
Trigger that occurs as a result of any such termination of the Executive’s
employment). 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 the Executive's 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.
4.
Payments
Due Upon a Payment Trigger.
(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.
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 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.
(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 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 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 apprize 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
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 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.
(F) Notwithstanding
any other provision of this Section 5, to the extent that the Executive is
entitled to a tax "gross-up" payment with respect to a Payment from the
Corporation, any Subsidiary, or any affiliate of the Corporation under any
other
agreement, the foregoing provisions of this Section 5 shall not apply to that
Payment.
6.
Termination
Procedures.
(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 11 hereof. For purposes of this Agreement, a "Notice
of
Termination" shall mean a written notice that sets forth the effective date
of
termination (subject to the provisions of Section 11(B) below) and, if for
Cause, Disability, or Good Reason, the facts and circumstances providing the
basis for termination of the Executive’s employment for Cause or for Disability
or Good Reason, as the case may be.
(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.
7.
Protective
Covenants By The Executive.
(A) Within
five days after the date of termination of the Executive's employment with
the
ALLTEL Group, the Executive shall deliver to the Corporation all of the ALLTEL
Group's property in the Executive's possession, custody or control, including,
without limitation, all keys and credit cards, all computers and fax machines,
and all files, documents, data and information in any medium relating in any
way
to the ALLTEL Group or its employees, suppliers, customers or
business.
(B) The
Executive acknowledges that in the course of the Executive's employment with
the
ALLTEL Group he has had and will have access to confidential information and
trade secrets proprietary to ALLTEL Group, including but not limited to,
information relating to the ALLTEL Group's products, suppliers, and customers,
the sources, nature, processes, costs and prices of the ALLTEL Group's products,
the names, addresses, contact persons, purchasing and sales histories, and
preference of the ALLTEL Group's suppliers and customers, the ALLTEL Group's
business plans and strategies, and the names and addresses of, amounts of
compensation paid to, and the trading and sales performance of the ALLTEL
Group's employees and agents (hereinafter referred to as the "Confidential
Information"). The Executive further acknowledges that the Confidential
Information is proprietary to the ALLTEL Group, that the unauthorized disclosure
of any of the Confidential Information to any person or entity could result
in
immediate and irreparable competitive injury to the ALLTEL Group, that could
not
adequately be remedied by an award of monetary damages. Accordingly, the
Executive shall not disclose at any time any Confidential Information to any
person or entity
who is not properly authorized by the Corporation to receive the information,
without
the prior written permission of the Corporation's Chief Executive
Officer.
(C) The
Executive shall not during the Executive's employment with the ALLTEL Group
and
thereafter until the expiration of 12 calendar months immediately following
the
calendar month in which occurs the Executive's termination of employment with
the ALLTEL Group knowingly employ, or knowingly assist any person or entity
other than the ALLTEL Group in employing, any employee of any member of the
ALLTEL Group. The Executive shall not during the term of the Executive's
employment with the ALLTEL Group and thereafter until the expiration of 12
calendar months immediately following the calendar month in which occurs the
Executive's termination of employment with the ALLTEL Group knowingly solicit,
or knowingly assist any person or entity to solicit, any employee of any member
of the ALLTEL Group to leave the ALLTEL Group's employment or to become employed
by any entity that is not a member of the ALLTEL Group.
(D)
The
Executive shall not at any time knowingly disseminate any information or
knowingly make any statements, whether written, oral or otherwise, that are
negative, disparaging or critical of the Corporation, any other member of the
ALLTEL Group, or any of their parents, subsidiaries, affiliates, or their
respective officers, directors, employees, shareholders, trustees,
administrators, or employee benefit plans, or the representatives, employees,
agents, predecessors, successors, heirs, or assigns of any of the foregoing
(hereinafter, the "ALLTEL Parties"), or their business or operations, or that
place any of the ALLTEL Parties in a bad light, other than any such statement
or
information that is made or disseminated by the Executive in a good faith belief
as to their truth or accuracy and is either required by law or is reasonably
necessary to the enforcement by the Executive of any right the Executive has
related to the Executive's employment with the ALLTEL Group.
(E)
Within
five days after the termination of the Executive's employment with the ALLTEL
Group, the Executive shall execute and deliver to the Chief Executive Officer
of
the Corporation such resignations as a director and officer of the Corporation
and any other members of the ALLTEL Group, in such form, as may be reasonably
requested by the Corporation's Chief Executive Officer.
(F) The
Executive shall not at any time assert that any provision of this Agreement
is
invalid or unenforceable in any respect or to any extent, irrespective of the
outcome of any action, suit or proceeding.
(G) If
a
Payment Trigger occurs during the term of this Agreement and if the Corporation
is not in breach of any of the Corporation's covenants set forth in this
Agreement, the Executive shall, until the expiration of 12 calendar months
immediately following the calendar month in which the Payment Trigger occurred,
provide such information and assistance as the Corporation may reasonably
request as necessary or appropriate to assist any ALLTEL Group member in the
arbitration or litigation or potential arbitration or litigation of any claim,
action, suit or proceeding by any person or entity other than the Executive
against any ALLTEL Group member arising from events occurring during the
Executive's employment with the ALLTEL Group, if the Corporation pays all
out-of-pocket expenses incurred by the Executive in complying with this
paragraph (G). The Executive shall not, however, be required to provide
assistance that would interfere with any activity for remuneration or profit
in
which the Executive is then actively engaged.
8.
No
Mitigation.
The
Executive shall not be 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.
9.
Disputes;
Remedies.
(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. Notwithstanding the foregoing provisions of this paragraph (A):
(i) The
Executive shall 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; and
(ii) The
Corporation shall be entitled to seek the injunctive relief described in
paragraph (E) of this Section 9 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 9, 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 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, all reasonable costs
and expenses, including reasonable attorney's fees and disbursements, of 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. The
Corporation shall pay prejudgment interest on any money judgment obtained by
the
Executive as a result of any such proceeding, calculated at the rate provided
in
Section 1274(b)(2)(B) of the Code. Notwithstanding the foregoing provisions
of
this paragraph (C):
(i) If
the
Executive instituted the legal proceeding and the judge, arbitrator, or other
individual presiding over the proceeding affirmatively finds that the Executive
instituted the proceeding in bad faith, no reimbursement pursuant to this
paragraph (C) shall be due to the Executive, the Executive shall repay the
Corporation for any amounts previously paid by it pursuant to this paragraph
(C), and the Executive shall pay all reasonable costs and expenses, including
reasonable attorney's fees and disbursements, of the Corporation in connection
with the proceeding;
(ii) With
respect to any dispute in which the Executive challenges the validity or
enforceability of any provision of this Agreement in any respect or to any
extent, no reimbursement or no further reimbursement pursuant to this paragraph
(C) shall be due to the Executive, and the Executive shall repay the Corporation
for any amounts previously paid by it pursuant to this paragraph (C); and
(iii) With
respect to any dispute or controversy regarding the provisions of Section 7,
other than a dispute to which the immediately preceding clause (ii) applies,
if
the Executive does not prevail (after exhaustion of all available remedies),
no
further reimbursement pursuant to this paragraph (C) shall be due to the
Executive, and the Executive shall repay the Corporation for any amounts
previously paid by it pursuant to this paragraph (C) in respect of such dispute.
(D) The
Executive acknowledges and agrees that the Executive's sole and exclusive remedy
with respect to any and all claims arising under this Agreement or for breach
hereof by the Corporation shall be the right to receive such amounts as are
provided for under Section 4, Section 5, and paragraph (C) of this Section
9, to
which the Executive is otherwise entitled pursuant to the terms and conditions
of this Agreement.
(E) The
Executive acknowledges and agrees that each and every covenant contained in
Section 7 (hereinafter, the "Protective Covenants ") is reasonable and is
necessary to protect the trade secrets, confidential information, and other
business interests of the ALLTEL Group and that the Executive's compliance
with
each of the Protective Covenants is necessary to protect the ALLTEL Group from
unfair injury. The Executive acknowledges that the Protective Covenants are
a
principal inducement for the willingness of the Corporation to enter into this
Agreement and make the payments and provide the benefits to the Executive under
this Agreement and that the Corporation and the Executive intend the Protective
Covenants to be binding upon and enforceable against the Executive in accordance
with their terms, notwithstanding any common or statutory law to the contrary.
Notwithstanding any other provision of this Agreement, the obligations of the
Corporation under this Agreement are conditioned upon compliance by the
Executive with each of the Protective Covenants, and failure by the Executive
to
comply, in all material respects, with the Protective Covenants shall entitle
the Corporation to all rights and remedies available at law or in equity. The
Executive acknowledges that a breach, in any material respect, of the Protective
Covenants could result in irreparable and continuing harm and damage to the
ALLTEL Group for which there may be no adequate remedy at law. In the event
of a
breach, in any material respects, of any of the Protective Covenants, each
and
every member of the ALLTEL
Group
shall be entitled to injunctive relief in addition to any other remedy or relief
to which any of them may be entitled.
10.
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 the Executive's
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 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
10 shall continue to apply to each subsequent employer of the 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 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.
11.
Notices.
For the
purpose of this Agreement, 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:
To
the
Corporation:
ALLTEL
Corporation
Xxx
Xxxxxx Xxxxx
Xxxxxx
Xxxx, Xxxxxxxx 00000
Attention:
Corporate Secretary
To
the
Executive:
0000
Xxxxxxxxxx Xxxxx, Xxx. 0000
Xxxxxx
Xxxx, XX 00000
12.
Miscellaneous.
No
provision of this Agreement 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.
13.
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.
14.
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.
IN
WITNESS WHEREOF,
the
parties have signed this Agreement as of the date set forth above.
| ALLTEL CORPORATION | |
|
Attest:
|
|
| /s/ X.X. Xxxxxx, Xx. | By: /s/ Xxxxx X. Xxxx |
| Name: X.X. Xxxxxx, Xx. | Name: Xxxxx X. Xxxx |
| Title: Executive Vice-President - Human Resources | Title: President and Chief Executive Officer |
|
Witness:
|
|
| /s/ Xxxxxx Xxxx | /s/ Xxxxxxxx Xxxxxxx |
| Xxxxxxxx Xxxxxxx |
