AT&T Executive Retention Agreement Term Sheet for Frank Ianna

Contract Categories: Human Resources › Retention Agreements
Summary

This agreement between AT&T and executive Frank Ianna outlines compensation and retention terms effective December 1, 2000. It specifies base salary, annual bonus, long-term incentive grants, special retention awards, deferral accounts, and equity grants. Vesting of awards and payments is generally contingent on continued employment, with provisions for accelerated vesting in cases of death, disability, company-initiated termination without cause, or resignation for good reason. The agreement also details tax treatment and payout timing for certain benefits. The terms are designed to incentivize Mr. Ianna to remain with AT&T through at least December 31, 2002.

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EX-10.III.A.40 16 e84804exv10wiiiwaw40.txt FORM OF RETENTION AGREEMENT . . . EXHIBIT 10(iii)(a)40 [AT&T LOGO] EXECUTIVE TERM SHEET EXECUTIVE: FRANK IANNA
- -------------------------------------------------------------------------------------------------------------------- New Assignment Terms - -------------------------------------------------------------------------------------------------------------------- Effective Date December 1, 2000 - -------------------------------------------------------------------------------------------------------------------- Base Salary: $700,000 - -------------------------------------------------------------------------------------------------------------------- Annual Bonus 2001 (Target %): $700,000 (100%) - -------------------------------------------------------------------------------------------------------------------- LTIP (Target) Annual Value:-2001 $8,000,000 LTI Grant Value for 2001; 2002 LTI Grant Value will be no less than $8,000,000 - -------------------------------------------------------------------------------------------------------------------- Special Retention: Special Retention Restricted Share Grant with value of $4,200,000, granted 1/2/01, vesting on 12/31/2002, based on continued employment. Prior to 12/31/2002, vests in event of death, disability, Company initiated termination for other than Cause, or Good Reason - -------------------------------------------------------------------------------------------------------------------- Special Deferral Account 1 Initial amount of $828,000 credited on 11/1/97; interest at 30 Year Treasury Bond (established 11/1/97) Rate. Current terms provide vesting as follows: - Leaves after 6 year anniversary (11/1/2003) - Death or LTD prior to 11/1/03 - Company-initiated termination prior to 11/1/03 - His election to leave prior to 11/1/03 for "Good Reason" - Loses if leaves for any reason other than those cited above New terms: - Vests at later of signing of this term sheet or February 1, 2001 (FICA/Medicare taxes due upon vesting; calculated as 1.45% of account balance on vesting date (e.g., based on 12/31/2000 balance of $995,721.64, tax would be $14,437.96;) - Other terms and conditions with respect to termination prior to vesting continue to apply, i.e., account fully vests upon death, disability, Company-initiated termination for other than Cause, self-initiated termination for Good Reason; account balance is forfeited for other terminations prior to vesting - -------------------------------------------------------------------------------------------------------------------- Special Deferral $1,000,000 deposited in special deferral account (SDA) effective - --------------------------------------------------------------------------------------------------------------------
Rev. 03/26/03 AT&T PROPRIETARY (RESTRICTED) USE PURSUANT TO COMPANY INSTRUCTIONS Acknowledged and Agreed _______________________ ________ Frank Ianna Date [AT&T LOGO] EXECUTIVE TERM SHEET EXECUTIVE: FRANK IANNA - -------------------------------------------------------------------------------------------------------------------- Account 2 upon signing of term sheet retroactive to 1/1/2001, annual interest at 30 year T Bill plus 2%, compounded quarterly; vests 1/2 on 12/31/2001, 1/2on 12/31/2002, contingent upon continued Company employment. Vested amount payable as lump sum in calendar quarter following termination. Prior to 12/31/2002, in event of Company initiated termination for other than Cause, Good Reason termination or death or disability, SDA fully vests and is payable as lump sum in calendar quarter following termination. Executive will sign a deferral agreement detailing terms and conditions. - -------------------------------------------------------------------------------------------------------------------- Special Cash Payment One-time cash lump sum payment of $300,000 fully grossed up for taxes such that net amount is $300,000. Payable within 30 days of signing term sheet. (Gross up is calculated assuming total tax rate of 46.09%: Federal: 39.6%; Federal itemized deduction limitation adjustment: 1.19%; New Jersey tax adjusted for federal deductibility: 3.85%; Medicare:1.45%); Gross payment would be $556,483. - -------------------------------------------------------------------------------------------------------------------- - - Special Equity Grants Current terms (Chairman's award in 2000 -- - Options vest 50% on 1/31/2001 and 50% on 98,000 options and 1/31/2002 contingent upon continued Company employment; 10,700 RSUs) - RSUs vest 1/31/2003 contingent upon continued Company employment; - Options (vested and unvested) and RSUs forfeited upon termination unless termination as a result of death, disability, or Company-initiated termination for other than Cause New terms : - RSUs vest as currently provided, on 1/31/2003 contingent upon continued Company employment; - Options vest as currently provided--50% on 1/31/2001 and 50% on 1/31/2002 contingent upon continued Company employment; - Options (vested and unvested) and RSUs are subject to accelerated vesting in event of death, disability, Company initiated termination for other than Cause, or Good Reason termination. - If options are vested at termination, as described above, they are exercisable for the remainder of the term - -------------------------------------------------------------------------------------------------------------------- CRSP (Special retention equity Current terms grant in 1999-- - Options vest 1/3 on each of following dates: 1/29/2002, - --------------------------------------------------------------------------------------------------------------------
Rev. 11/2000 PAGE 2 AT&T PROPRIETARY (RESTRICTED) USE PURSUANT TO COMPANY INSTRUCTIONS Acknowledged and Agreed _______________________ _______ Frank Ianna Date [AT&T LOGO] EXECUTIVE TERM SHEET EXECUTIVE: FRANK IANNA - -------------------------------------------------------------------------------------------------------------------- 325,500 options 1/29/2003, 1/29/2004 contingent upon continued Company employment, and 65,100 RSUs) - Options (vested and unvested) forfeited if termination is prior to 65 (unless death, disability, or Committee approved retirement prior to 65); - RSUs vest at age 65; prorated for death, disability and Committee approved retirement less than age 65 New Terms: - Unvested options and RSUs vest 12/31/2002 contingent upon continued Company employment - Options exercisable for remainder of term for termination on or after 12/31/2002; - Vesting will accelerate (i.e., 100% vesting for options and RSUs) upon death, disability, Committee approved retirement prior to 65, Company-initiated termination for other than Cause, or Good Reason termination - -------------------------------------------------------------------------------------------------------------------- Other Stock Options which are Assuming retirement on or after 12/31/2002: outstanding as of 12/31/2000 - All other stock options not referenced above, which are outstanding as of 12/31/2000 (including the AWE and AWE retention grants granted in 2000), to the extent not otherwise vested by virtue of their terms and conditions, will vest upon such retirement. - At such retirement all outstanding unexercised vested options (including the AWE and AWE retention grants granted in 2000) will be exercisable for the remainder of the term. - -------------------------------------------------------------------------------------------------------------------- Restricted Stock Units Granted - RSUs vest upon retirement assuming retirement is on or after as Part of 2001 Annual Long 12/31/2002 Term Award - -------------------------------------------------------------------------------------------------------------------- Definitions "Good Reason" termination and "Cause" shall have the same meanings as in the SOSP and 11/1/97 Special Deferral Agreement. - --------------------------------------------------------------------------------------------------------------------
Rev. 11/2000 PAGE 3 AT&T PROPRIETARY (RESTRICTED) USE PURSUANT TO COMPANY INSTRUCTIONS Acknowledged and Agreed ________________________ _____ Frank Ianna Date [AT&T LOGO] EXECUTIVE TERM SHEET EXECUTIVE: FRANK IANNA * Rev. 11/2000 PAGE 4 AT&T PROPRIETARY (RESTRICTED) USE PURSUANT TO COMPANY INSTRUCTIONS Acknowledged and Agreed ________________________ ______ Frank Ianna Date