AMENDMENT TO EMPLOYEE BENEFITS AGREEMENT
Exhibit 10.7
WHEREAS, Alltel Corporation (“Alltel”) and Alltel Holding Corp. (“Spinco”) entered into
an Employee Benefits Agreement, dated as of December 8, 2005 (the “Agreement”);
WHEREAS, Alltel and Spinco desire to make certain changes to the Agreement regarding the
transfer of obligations and liabilities regarding executive benefits; and
NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained
in the Agreement and this Amendment, and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
| 1. | Sections 7.01 and 7.02 of the Agreement are amended to insert the phrase “and Spinco Employees” immediately after the term “Spinco Individuals” in each place that it appears. | ||
| 2. | Section 7.03 of the Agreement is amended to provide as follows: |
7.03 Restricted Stock. Each Alltel Restricted Share award outstanding under the 1998
Equity Incentive Plan or the 2001 Equity Incentive Plan and held by a Spinco Individual or Spinco
Employee as of the Distribution Date (a “Specified Award”) shall not be forfeited on the
Distribution Date and shall become fully vested on August 3, 2006. In determining a Spinco
Individual’s or Spinco Employee’s rights with respect to a Specified Award, employment after the
Distribution Date with Spinco, a successor in interest to Spinco or any of their Subsidiaries (as
defined in the Merger Agreement) shall be treated as employment with Alltel. Each share of Spinco
common stock that is distributed with respect to a Specified Award (and each share of Company
common stock into which such Spinco common stock is converted) shall be restricted and conditioned
to the same extent and for the same period as the Specified Award is restricted and conditioned
(taking into account the full vesting and deemed Alltel employment provided for in two preceding
sentences). In the event of a forfeiture of any of the foregoing restricted shares, such
restricted shares shall be forfeited to the issuer of the shares. Spinco shall take all steps that
are necessary to ensure that the restrictions and conditions contemplated by this Section 7.03 are
applied to the Company common stock referenced above.
| 3. | Section 8.01 of the Agreement is amended to provide as follows: | ||
| 8.01 | Establishment of Mirror Benefit Restoration Plan. |
(a) Establishment. Prior to the Distribution Date, Spinco shall
establish, or cause to be established, a plan for Spinco Employees and Spinco
Individuals, the provisions of which shall be substantially identical to the
provisions of the Benefit Restoration Plan (the “Spinco Restoration
Plan”).
(b) Transfer of Obligations/Liabilities. Effective as of the date
of establishment of the Spinco Restoration Plan, the obligations and liabilities
with respect to Spinco Employees and Spinco Individuals under the Benefit
Restoration Plan shall be transferred to and assumed by the Spinco Restoration
Plan.
(c) Transfer of Cash. On July 18, 2006, Alltel shall transfer cash
to the general funds of Windstream Corporation as successor to Spinco in an
amount sufficient to provide for the payment of the obligations and liabilities
with respect to Spinco Individuals (except the individual employed by Alltel as
of December 8, 2005) under the Benefit Restoration Plan that are transferred to
and assumed by the Spinco Restoration Plan (assuming for purposes of calculating
this amount only, that all benefits shall be payable in a single lump sum on May
31, 2006 and that, for the single lump sum with respect to the retirement
benefits provided in Article V of the Benefit Restoration Plan, the lump sum is
calculated as of January 1, 2006 (if not in pay status, based on such
individual’s benefit payable as of his normal retirement date (as defined in the
Benefit Restoration Plan)) using a 5.8% interest rate and the FAS No. 87
actuarial methods and assumptions included in Schedule IV, reduced by any
payments made between January 1, 2006 and the Distribution Date).
| 4. | Section 8.03 of the Agreement is amended to provide as follows: | ||
| 8.03 | Executive Deferred Compensation Plan. |
(a) Establishment. Prior to the Distribution Date, Spinco shall
establish, or cause to be established, a plan for Spinco Employees and Spinco
Individuals, the provisions of which shall be substantially identical to the
provisions of the Executive Deferred Compensation Plan, including the provisions
of the Executive Deferred Compensation Plan that are known as the Executive
Deferred Compensation Sub-Plan (the “Spinco Executive Plan”).
(b) Transfer of Obligations/Liabilities. Effective as of the date
of establishment of the Spinco Executive Plan, the obligations and liabilities
with respect to Spinco Employees and Spinco Individuals under the Executive
Deferred Compensation Plan shall be transferred to and assumed by the Spinco
Executive Plan.
(c) Transfer of Cash. On July 18, 2006, Alltel shall transfer cash
to the general funds of Windstream Corporation as successor to Spinco in an
amount sufficient to provide for the payment of the obligations and liabilities
with respect to Spinco Employees and Spinco Individuals under the Executive
Deferred Compensation Plan that are transferred to and assumed by the Spinco
Executive Plan (assuming for purposes of calculating this amount only, that all
benefits shall be payable in a single lump sum on the Distribution Date).
| 5. | Section 8.04 of the Agreement is amended to provide as follows: | ||
| 8.04 | 1998 Management Deferred Compensation Plan. |
(a) Establishment. Prior to the Distribution Date, Spinco shall
establish, or cause to be established, a plan for Spinco Employees and Spinco
Individuals,
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the provisions of which shall be substantially identical to the provisions of
the 1998 Management Deferred Compensation Plan, including the provisions of the
1998 Management Deferred Compensation Plan that are known as the 1998 Management
Deferred Compensation Sub-Plan (the “Spinco 1998 Management Plan”).
(b) Transfer of Obligations/Liabilities. Effective as of the date
of establishment of the Spinco 1998 Management Plan, the obligations and
liabilities with respect to Spinco Employees and Spinco Individuals under the
1998 Management Deferred Compensation Plan shall be transferred to and assumed
by the Spinco 1998 Management Plan.
(c) Transfer of Cash. Alltel shall transfer cash to the general
funds of Windstream Corporation as successor to Spinco on July 18, 2006 in an
amount sufficient to provide for the payment of the obligations and liabilities
with respect to Spinco Employees and Spinco Individuals under the 1998
Management Deferred Compensation Plan that are transferred to and assumed by the
Spinco 1998 Management Plan (assuming for purposes of calculating this amount
only, that all benefits shall be payable in a single lump sum on the
Distribution Date).
IN WITNESS WHEREOF, the parties have caused this Amendment to Employee Benefits Agreement to
be duly executed as of this 17th day of July, 2006.
| ALLTEL CORPORATION |
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| By: | /s/ Xxxxxxx X. Xxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxx | |||
| Title: | Executive Vice President and General Counsel | |||
| ALLTEL HOLDING CORP. |
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| By: | /s/ Xxxx X. Xxxxxxxx | |||
| Name: | Xxxx X. Xxxxxxxx | |||
| Title: | Executive Vice President and General Counsel | |||
