AT&T EXCESS BENEFIT AND COMPENSATION PLAN
AT&T Corp.
and
Such of its Subsidiary Companies which are
Participating Companies
Effective October 1, 1996
AT&T EXCESS BENEFIT AND COMPENSATION PLAN
Table of Contents
1. BACKGROUND AND
PURPOSE......................................................1
2.
DEFINITIONS.................................................................3
2.1.
ADMINISTRATOR........................................................3
2.2. AFFILIATED
CORPORATION...............................................3
2.3.
AT&T.................................................................3
2.4.
BENEFICIARY..........................................................3
2.5. BENEFIT
LIMITATION...................................................3
2.6.
BOARD................................................................3
2.7.
CODE.................................................................3
2.8.
COMMITTEE............................................................3
2.9. COMPENSATION
LIMITATION..............................................4
2.10.
EBA.................................................................4
2.11.
ERISA...............................................................4
2.12. EXCESS RETIREMENT
BENEFIT...........................................4
2.13.
EXECUTIVE...........................................................4
2.14.
PARTICIPANT.........................................................4
2.15. PARTICIPATING
COMPANY...............................................4
2.16.
PLAN................................................................4
2.17.
SUBSIDIARY..........................................................4
2.18. SURVIVING
SPOUSE....................................................4
2.19. TERM OF
EMPLOYMENT..................................................5
2.20. TRANSFERRED
INDIVIDUAL..............................................5
3.
ELIGIBILITY.................................................................6
3.1.
PARTICIPATION........................................................6
3.2. SURVIVING SPOUSE
BENEFIT.............................................6
3.3. RELATIONSHIP TO OTHER
PLANS..........................................6
3.4. FORFEITURE OF
BENEFITS...............................................6
4. RETIREMENT AND DEATH
BENEFITS...............................................7
4.1. EXCESS RETIREMENT
BENEFITS...........................................7
4.2. AMOUNT OF EXCESS RETIREMENT
BENEFIT..................................7
4.3. COMMENCEMENT AND FORM OF BENEFITS PAYABLE TO PARTICIPANT
OR SURVIVING
SPOUSE..................................................8
4.4. NO SURVIVING
SPOUSE..................................................8
4.5. FUTURE BENEFIT
ADJUSTMENTS...........................................8
4.6. DETERMINATION OF
BENEFITS............................................9
4.7. SUSPENSION AND RECOMMENCEMENT OF BENEFIT
PAYMENTS....................9
4.8. MANDATORY PORTABILITY
AGREEMENT......................................9
4.9. EXCESS DEATH
BENEFIT.................................................9
5. DISPOSITION OF PARTICIPATING
COMPANY.......................................11
5.1. SALE, SPIN-OFF, OR OTHER DISPOSITION OF PARTICIPATING
COMPANY.......11
6. SOURCE OF
PAYMENT..........................................................12
6.1. SOURCE OF
PAYMENTS..................................................12
6.2. UNFUNDED
STATUS.....................................................12
6.3. FIDUCIARY
RELATIONSHIP..............................................13
7. ADMINISTRATION OF THE
PLAN.................................................14
7.1.
ADMINISTRATION......................................................14
7.2.
INDEMNIFICATION.....................................................14
7.3. CLAIMS
PROCEDURE....................................................14
7.4. NAMED
FIDUCIARIES...................................................15
7.5. ROLE OF THE
COMMITTEE...............................................15
7.6. ALLOCATION OF
RESPONSIBILITIES......................................15
7.7. MULTIPLE
CAPACITIES.................................................15
8. AMENDMENT AND
TERMINATION..................................................16
8.1. AMENDMENT AND
TERMINATION...........................................16
9. GENERAL
PROVISIONS.........................................................17
9.1. BINDING
EFFECT......................................................17
9.2. NO GUARANTEE OF
EMPLOYMENT..........................................17
9.3. TAX
WITHHOLDING.....................................................17
9.4. ASSIGNMENT OF
BENEFITS..............................................17
9.5. FACILITY OF
PAYMENT.................................................17
9.6.
SEVERABILITY........................................................18
9.7. PLAN
YEAR...........................................................18
9.8.
HEADINGS............................................................18
9.9. GOVERNING
LAW.......................................................18
9.10. ENTIRE
PLAN........................................................18
ADMINISTRATION OF THE PLAN
AT&T EXCESS BENEFIT AND COMPENSATION PLAN
AMENDED and RESTATED effective October 1, 1996
Article
1. Background and Purpose
The AT&T Excess Benefit Plan was established to provide eligible
management and occupational employees of AT&T Corp. (formerly American Telephone
and Telegraph Company) ("AT&T") and its subsidiaries that became Participating
Companies with certain benefits which would have been payable under the AT&T
Management Pension Plan or the AT&T Pension Plan, respectively, but for the
limitations placed on benefits payable under the AT&T Management Pension Plan or
the AT&T Pension Plan by section 415 of the Internal Revenue Code of 1986, as
amended (and its predecessor, the Internal Revenue Code of 1954, as amended)
("Code"). Effective January 1, 1989, AT&T established an additional plan to
provide eligible management employees with certain benefits which would have
been payable under the AT&T Management Pension Plan but for the limitations
placed on eligible compensation by Code ss. 401(a)(17). The aforementioned plans
are intended to encompass those plans identified in AT&T's December 28, 1992
filing with the Pension and Welfare Benefits Administration ("PWBA") in response
to the PWBA's September 21, 1992 Notice (Extension of Grace Period for
Assessment of Civil Penalties for Failure to File Timely Annual Return Reports;
Top Hat Plans and Pre-Grace Period Late Filers). These plans are amended and
restated, effective January 1, 1994, and shall hereinafter be referred to
collectively as the "AT&T Excess Benefit and Compensation Plan" or "Plan."
The Plan is intended to constitute an unfunded "excess benefit plan" as
defined in section 3(36) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), to the extent it provides benefits that would be paid
under the AT&T Management Pension Plan or the AT&T Pension Plan but for the
limitations imposed by Code ss. 415, and an "unfunded plan of deferred
compensation for a select group of management or highly compensated employees"
for purposes of Title I of ERISA, to the extent it provides other benefits.
Except as expressly provided below, this amended and restated plan
document applies only to employees who terminate employment on or after October
1, 1996. For former employees who terminated employment before
October 1, 1996,
the provisions of the AT&T Excess Benefit and Compensation Plan in effect at
termination of the former employee's employment governs.
Effective October 1, 1996, Lucent Technologies Inc. established the
Lucent Technologies Inc. Excess Benefit and Compensation Plan as a successor to
the AT&T Excess Benefit and Compensation Plan, in effect as of September 30,
1996, with respect to Transferred Individuals (as defined in Article 2).
Accordingly, the AT&T Excess Benefit and Compensation Plan relinquished to the
Lucent Technologies Inc. Excess Benefit and Compensation Plan all liabilities as
of September 30, 1996 relating to Transferred Individuals, and the Lucent
Technologies Inc. Excess Benefit and Compensation Plan assumed and is solely
responsible for all such liabilities. Except to the extent required by law or
Article 5 of this Plan, the Plan shall not recognize service and compensation
before October 1, 1996 with respect to Transferred Individuals. Effective as of
the date an individual becomes a "Transition Individual" (as defined in Section
1.38(a) or (d) of the Management Interchange Agreement or Section 1.30(a) or (d)
of the Occupational Interchange Agreement), the Plan shall also assume and be
solely responsible for all liabilities relating to such Transition Individuals.
Article
2. Definitions
Unless the context clearly indicates otherwise, the following terms
have the meanings described below when used in this Plan and references to a
particular Article or Section shall mean the Article or Section so delineated in
this Plan.
2.1. Administrator
With respect to individuals covered by the AT&T Management Pension
Plan, the Pension Plan Administrator under the AT&T Management
Pension Plan and,
with respect to individuals covered by the AT&T Pension Plan,
the Pension Plan
Administrator under the AT&T Pension Plan.
2.2. Affiliated Corporation
Any corporation of which more than 50 percent of the voting stock is
owned directly or indirectly by AT&T.
2.3. AT&T
AT&T Corp. (formerly the American Telephone and
Telegraph Company), a
New York corporation, or its successor.
2.4. Beneficiary
Any person entitled to an Excess Death Benefit pursuant to Section 4.9.
2.5. Benefit Limitation
The maximum benefit payable to a Participant under the AT&T Management
Pension Plan or the AT&T Pension Plan in accordance with Code ss. 415, but after
application of the Compensation Limitation, if any, under the AT&T Management
Pension Plan or the AT&T Pension Plan.
2.6. Board
The Board of Directors of AT&T.
2.7. Code
The Internal Revenue Code of 1986, as amended from time to time. Any
reference to a particular section of the Code includes any applicable
regulations promulgated under that section.
2.8. Committee
The AT&T Employees' Benefit Committee.
2.9. Compensation Limitation
The maximum amount of annual compensation under Code ss. 401(a)(17)
that may be taken into account in any Plan Year for benefit accrual purposes
undeR the AT&T Management Pension Plan or for purposes of calculating an
Accident Death Benefit, Sickness Death Benefit or Pensioner Death Benefit under
the AT&T Management Pension Plan.
2.10. EBA
The Employee Benefits Agreement between AT&T and
Lucent Technologies
Inc. as of February 1, 1996, as amended.
2.11. ERISA
The Employee Retirement Income Security Act of 1974, as amended from
time to time. Any reference to a particular section of ERISA includes any
applicable regulations promulgated under that section.
2.12. Excess Retirement Benefit
The benefit, if any, described in Article 4 which is payable to a
Participant or a Surviving Spouse under the terms of the Plan.
2.13. Executive
An individual who is considered to be within "a select group of
management or highly compensated employees" for purposes of Title I of ERISA and
whose annual compensation in any year exceeds the Compensation Limitation.
2.14. Participant
An individual and/or an Executive who has satisfied the eligibility
requirements in Section 3.1 for accrual of an Excess Retirement Benefit.
2.15. Participating Company
AT&T and any Affiliated Corporation which is a Participating Company
under the AT&T Management Pension Plan or the AT&T Pension Plan.
2.16. Plan
This AT&T Excess Benefit and Compensation Plan.
2.17. Subsidiary
Any corporation of which more than 80% of the voting stock is owned
directly or indirectly by AT&T.
2.18. Surviving Spouse
A deceased Participant's surviving spouse who is eligible to receive a
survivor annuity benefit under the AT&T Management Pension Plan or the AT&T
Pension Plan.
2.19. Term of Employment
"Term of Employment" within the meaning of the AT&T Management Pension
Plan or the AT&T Pension Plan, as applicable, for purposes of calculating the
amount of a Participant's benefit.
2.20. Transferred Individual
A "Transferred Individual" within the meaning of the EBA.
Article
3. Eligibility
3.1. Participation
(i) Each individual who becomes eligible or is eligible for a deferred
vested pension, a disability pension or a service pension, under the terms and
conditions of either the AT&T Management Pension Plan or the AT&T Pension Plan,
shall be eligible to participate in this Plan, and/or (ii) each Executive who,
in any year, has annual compensation in excess of the Compensation Limitation
and who becomes or is eligible for a deferred vested pension, a disability
pension or a service pension, under the terms and conditions of the AT&T
Management Pension Plan, shall be eligible to participate in this Plan.
3.2. Surviving Spouse Benefit
Each Surviving Spouse of a Participant shall be eligible to receive an
Excess Retirement Benefit under the Plan, if eligible as provided in Section 4.1
of the Plan.
3.3. Relationship To Other Plans
The Excess Retirement Benefit and Excess Death Benefit payable under
the Plan shall be in addition to any other benefits provided, directly or
indirectly, to a Participant, Surviving Spouse or Beneficiary by any the
Participating Company. Participation in the Plan shall not preclude or limit the
participation of the Participant in any other benefit plan sponsored by a
Participating Company for which such Participant would otherwise be eligible.
The Excess Retirement Benefit and Excess Death Benefit payable to a Participant,
Surviving Spouse or Beneficiary under this Plan shall not duplicate benefits
payable to such Participant, Surviving Spouse or Beneficiary under any other
plan or arrangement of a Participating Company or any Affiliated Corporation.
3.4. Forfeiture of Benefits
If any Participant who otherwise would be entitled to an Excess
Retirement Benefit under this Plan is discharged for cause due to conviction of
a felony related to his or her employment, the rights of such Participant to an
Excess Retirement Benefit under this Plan, including the rights of the
Participant's spouse to an Excess Retirement Benefit as a Surviving Spouse
and/or the rights of a Beneficiary to an Excess Death Benefit, shall be
forfeited.
Article
4. Retirement and Death Benefits
4.1. Excess Retirement Benefits
If the benefit payable to a Participant or a Surviving Spouse under the
AT&T Management Pension Plan or the AT&T Pension Plan is limited by reason of
the application of the Benefit Limitation and/or, for an Executive or a
Surviving Spouse of an Executive, the Compensation Limitation, an Excess
Retirement Benefit shall be paid as provided in this Article 4 to the
Participant or the Surviving Spouse.
4.2. Amount of Excess Retirement Benefit
The amount, if any, of the Excess Retirement Benefit payable monthly to
a Participant or a Surviving Spouse shall be equal to the difference between (i)
and (ii) where:
(i) is the amount of the monthly pension
benefit which would
be provided to the Participant or Surviving Spouse
under the AT&T
Management Pension Plan or the AT&T Pension Plan, without
regard to the
Benefit Limitation and/or for an Executive, or a
Surviving Spouse of an
Executive, without regard to the Compensation Limitation
under the AT&T
Management Pension Plan, based upon the AT&T Management
Pension Plan or
the AT&T Pension Plan formula, as applicable, in effect
as of the date
of termination of employment or death; and
(ii) is the amount of the monthly pension
benefit actually
payable to such Participant or Surviving Spouse
under the AT&T
Management Pension Plan or the AT&T Pension Plan.
The amount of the Excess Retirement Benefit payable as a result of the
application of the Benefit Limitation under the AT&T Management Pension Plan or
the AT&T Pension Plan shall be determined or redetermined, based upon the AT&T
Management Pension Plan or the AT&T Pension Plan formula, as applicable, in
effect as of the date of termination of employment or termination of
reemployment pursuant to Section 4.7 or death, (a) as of the date when benefits
are to commence pursuant to Section 4.3 or recommence pursuant to Section 4.7;
(b) as of the effective date of any subsequent increases and/or decreases in the
Benefit Limitation, and/or (c) as of the effective date of any special increases
in the monthly benefit payable, prior to application of the Benefit Limitation,
as a result of amendments to the AT&T Management Pension Plan and/or the AT&T
Pension Plan, whichever is applicable. Further, the amount of the Excess
Retirement Benefit shall be reduced for commencement of the Excess Retirement
Benefit prior to age 55 and/or for the cost of the survivor annuity, if any, in
the same manner as is set forth in the AT&T Management Pension Plan or the AT&T
Pension Plan, as applicable.
4.3. Commencement and Form of Benefits Payable to Participant
or Surviving
Spouse
The Excess Retirement Benefit provided under this Plan payable to
either the Participant or the Surviving Spouse (a) shall commence at the same
time, (b) shall be paid for as long as (subject to Section 4.2) and (c) shall be
paid in the same benefit form as the Participant's or Surviving Spouse's
benefits are paid under the AT&T Management Pension Plan or the AT&T Pension
Plan; whichever is applicable, provided, however, that the Committee shall have
the right to approve the Participant's election of the form of the Excess
Retirement Benefit payable to the Participant.
4.4. No Surviving Spouse
If a Participant dies before the date as of which his or her benefit
commences under the AT&T Management Pension Plan or the AT&T Pension Plan, and
he or she does not have a Surviving Spouse on his or her date of death, no
Excess Retirement Benefit shall be paid after the death of the Participant with
respect to the Participant.
4.5. Future Benefit Adjustments
(a)......If a Participant has commenced receiving a service or
disability pension under the AT&T Management Pension Plan or the AT&T Pension
Plan in the form of a joint and 50 percent survivor annuity and his or her
designated annuitant subsequently predeceases him or her, the Participant's
Excess Retirement Benefit under this Plan shall be calculated in accordance with
Section 4.02 and thereafter paid, prospectively, by restoring the original cost
of the joint and 50 percent survivor annuity form of benefit under the AT&T
Management Pension Plan or the AT&T Pension Plan, whichever is applicable. Such
adjustment shall be effective as of the first day of the first month following
the death of the Participant's surviving annuitant.
(b)......In the event that, following commencement of benefits to a
Participant under the Plan, the AT&T Management Pension Plan benefit is
subsequently adjusted to include any payments considered Compensation under the
AT&T Management Pension Plan paid after commencement of the AT&T Management
Pension Plan benefit, the Excess Retirement Benefit to the Participant under
this Plan shall be recalculated as soon as practicable after the AT&T Management
Pension Plan benefit is adjusted and shall be paid retroactively to the date the
AT&T Management Pension Plan benefit commences, if the AT&T Management Pension
Plan benefit is adjusted retroactively to such date.
(c)......In the event that, following commencement of benefits to a
Participant or Surviving Spouse under the Plan, the AT&T Management Pension Plan
or AT&T Pension Plan benefit is subsequently increased as a result of a
successful claim for benefits under the AT&T Management Pension Plan or AT&T
Pension Plan, the Excess Retirement Benefit to the Participant or Surviving
Spouse under this Plan shall be recalculated as soon as practicable after the
AT&T Management Pension Plan or the AT&T Pension Plan benefit is adjusted.
4.6. Determination of Benefits
Excess Retirement Benefit payments and Excess Death Benefit payments
under this Plan shall be calculated in accordance with the rules, procedures,
and assumptions utilized under the AT&T Management Pension Plan or the AT&T
Pension Plan, whichever is applicable. Thus, whenever it is necessary to
determine whether one benefit is less than, equal to, or larger than another, or
to determine the equivalent actuarial value of any benefit, whether or not such
form of benefit is provided under this Plan, such determination shall be made,
at the Administrator's discretion, by AT&T's enrolled actuary, using mortality,
interest and other assumptions normally used at the time in determining
actuarial equivalence under the AT&T Management Pension Plan or AT&T Pension
Plan, whichever is applicable.
4.7. Suspension and Recommencement of Benefit Payments
A Participant's employment or reemployment subsequent to retirement or
termination of employment with entitlement to an Excess Retirement Benefit under
this Plan shall result in the permanent suspension of payment of the Excess
Retirement Benefit to the Participant for the period of such employment or
reemployment to the extent and in a manner consistent with the terms and
conditions applicable to the suspension of benefit payments under the AT&T
Management Pension Plan or the AT&T Pension Plan, whichever is applicable. A
Participant's Excess Retirement Benefit shall recommence simultaneously with the
recommencement of his or her benefits under the AT&T Management Pension Plan or
the AT&T Pension Plan. The amount of the Participant's Excess Retirement Benefit
upon recommencement shall be adjusted to reflect adjustments, if any, in the
amount of the Participant's pension benefit under the AT&T Management Pension
Plan or the AT&T Pension Plan resulting from the period of reemployment,
pursuant to Section 4.2. Following recommencement of payment under this Plan,
the Participant (or Surviving Spouse) shall not be eligible to receive any
Excess Retirement Benefit payments that would otherwise have been payable but
for the suspension.
4.8. Mandatory Portability Agreement
A Participant (a) who is employed by an "Interchange Company", as that
term is defined under the Mandatory Portability Agreement ("MPA"), subsequent to
retirement or termination of employment from AT&T, its subsidiaries or any
Affiliated Company, (b) who is covered under the terms and conditions of the
MPA, and (c) for whom assets and liabilities are transferred from the AT&T
Management Pension Plan or the AT&T Pension Plan, shall forfeit his rights to an
Excess Retirement Benefit under this Plan, including the rights of the
Participant's spouse to an Excess Retirement Benefit as a Surviving Spouse and
the rights of Beneficiary to an Excess Death Benefit.
4.9. Excess Death Benefit
(a)......If the actual Accident Death Benefit, Sickness Death Benefit
or Pensioner Death Benefit ("Death Benefit") payable to any person as a result
of the death of a Participant under the terms of the AT&T Management Pension
Plan is reduced or limited by reason of the Compensation Limitation, an Excess
Death Benefit shall be paid as provided in this Section 4.9 to the beneficiary
otherwise entitled to receive the Death Benefit under the terms and conditions
of the AT&T Management Pension Plan.
(b)......The amount, if any, of the Excess Death Benefit payable shall
be equal to the difference between (i) and (ii) where:
(i) is the amount of the Death Benefit which
would be provided
to the beneficiary under the AT&T Management Pension
Plan without
regard to the Compensation Limitation under the AT&T
Management Pension
Plan in effect as of the date of death; and
(ii) is the amount of the Death Benefit actually payable to
such beneficiary under the AT&T Management Pension Plan.
(c)......The Excess Death Benefit provided under this Plan (i) shall
commence at the same time, (ii) shall be paid for as long as, and (iii) shall be
paid in the same benefit form as the Committee or its delegate has determined
with respect to the Death Benefit payable under the AT&T Management Pension
Plan.
Article
5. Disposition of Participating Company
5.1. Sale, Spin-Off, or Other Disposition of Participating
Company
(a)......Subject to Sections 4.8 and 9.1, in the event AT&T sells,
spins off, or otherwise disposes of a Subsidiary or an Affiliated Corporation,
or disposes of all or substantially all of the assets of a Subsidiary or an
Affiliated Corporation such that one or more Participants terminate employment
for the purpose of accepting employment with the purchaser of such stock or
assets, any person employed by such Subsidiary or Affiliated Corporation who
ceases to be an employee as a result of the sale, spin-off, or disposition shall
be deemed to have terminated his or her employment with a Participating Company
and be eligible for an Excess Retirement Benefit commencing at the same time as
his or her benefit, if any, commences under the AT&T Management Pension Plan or
the AT&T Pension Plan. Further, if the Participant dies after termination of
employment as described in this Section 5.1, his or her Surviving Spouse may be
entitled to an Excess Retirement Benefit, if eligible as provided in Section
4.1, and/or his or her Beneficiary may be entitled to an Excess Death Benefit,
if eligible as provided in Section 4.9.
(b)......Notwithstanding the foregoing provisions of this Section 5.1,
and subject to Section 9.1, if, as part of the sale, spin-off, or other
disposition of the stock or assets of a Subsidiary or Affiliated Corporation,
the Subsidiary or Affiliated Corporation, its successor owner, or any other
party agrees in writing to assume the liability for the payment of the Excess
Retirement Benefit and/or the Excess Death Benefit to which the Participant,
Surviving Spouse and/or Beneficiary would have been entitled under the Plan but
for such sale, spin-off, or other disposition, then the entitlement of the
Participant or his or her Surviving Spouse to an Excess Retirement Benefit
and/or any Beneficiary to an Excess Death Benefit under this Plan shall
terminate. Any subsequent entitlement of the former Participant or his or her
Surviving Spouse or Beneficiary to the Excess Retirement Benefit and/or the
Excess Death Benefit shall be the sole responsibility of the assuming party.
Upon the assumption of the liability for the payment of an Excess Retirement
Benefit and Excess Death Benefit by Lucent Technologies Inc. pursuant to Section
6.1 of the EBA, the entitlement of a Transferred Individual (as defined in the
EBA), and/or his or her Surviving Spouse or Beneficiary, to an Excess Retirement
Benefit and/or an Excess Death Benefit under this Plan shall terminate. Upon the
assumption of the liability for the payment of an Excess Retirement Benefit and
Excess Death Benefit by Lucent Technologies Inc. pursuant to Section 7.1 of the
Management Interchange Agreement or Section 3.1 of the Occupational Interchange
Agreement, both dated as of April 8, 1996, between AT&T and Lucent Technologies
Inc., the entitlement of a Transition Individual (as defined in Section 1.38(b)
or (c) of the Management Interchange Agreement or Section 1.30(b) or (c) of the
Occupational Interchange Agreement), and/or his or her Surviving Spouse or
Beneficiary, to an Excess Retirement Benefit and/or an Excess Death Benefit
under this Plan shall terminate.
Article
6. Source of Payment
6.1. Source of Payments
Benefits arising under this Plan and all costs, charges, and expenses
relating thereto will be payable from the Company's general assets. The Company
may, however, establish a trust to pay such benefits and related expenses,
provided such trust does not cause the Plan to be "funded" within the meaning of
ERISA. To the extent trust assets are available, they may be used to pay
benefits arising under this Plan and all costs, charges, and expenses relating
thereto. To the extent that the funds held in the trust, if any, are
insufficient to pay such benefits, costs, charges and expenses, the Company
shall pay such benefits, costs, charges, and expenses from its general assets.
In addition, the Company may, in its sole discretion, purchase and distribute
one or more commercial annuity contracts, or cause the trustee of the trust to
purchase and distribute one or more commercial annuity contracts, to make
benefit payments required under this Plan, to any Senior Manager, as defined in
the AT&T Non-Qualified Pension Plan, or the Surviving Spouse of any Senior
Manager, provided, however, that the purchase and distribution of any such
annuity contracts shall be no sooner than the expiration of any forfeiture
provisions applicable to the Senior Manager under the AT&T Non-Competition
Guidelines. Such annuity contracts may be purchased from a commercial insurer
acceptable to the Executive Vice President - Human Resources. Further, the
Executive Vice President - Human Resources, may determine, in his sole
discretion, to pay additional sums to any Senior Manager, from the Company's
general assets or from the trust, if any, to reimburse the Senior Manager for
additional federal and state income taxes estimated to be incurred by reason of
the distribution of any such annuity contracts. The Executive Vice President
Human Resources shall establish a methodology or methodologies for determining
the amount of such additional sums. The methodology or methodologies selected
shall be those that the Executive Vice President - Human Resources determines,
in his sole discretion, to be the most effective and administratively feasible
for the purpose of producing after tax periodic benefit payments that
approximate the after tax periodic benefit payments that would have been
received by Senior Managers in the absence of the distribution of the annuity
contract.
6.2. Unfunded Status
The Plan at all times shall be entirely unfunded for purposes of the
Code and ERISA and no provision shall at any time be made with respect to
segregating any assets of a Participating Company for payment of any benefits
hereunder. Funds that may be invested through a trust described in Section 6.1
shall continue for all purposes to be part of the general assets of the
Participating Company which invested the funds. The Plan constitutes a mere
promise by AT&T and the Participating Companies to make Excess Retirement
Benefit payments and Excess Death Benefit payments, if any, in the future. No
Participant, Surviving Spouse or any other person shall have any interest in any
particular assets of a Participating Company by reason of the right to receive a
benefit under the Plan and to the extent the Participant, Surviving Spouse or
any other person acquires a right to receive benefits under this Plan, such
right shall be no greater than the right of any unsecured general creditor of a
Participating Company.
6.3. Fiduciary Relationship
Nothing contained in the Plan, and no action taken pursuant to the
provisions of the Plan, shall create or be construed to create a trust or a
fiduciary relationship between or among AT&T, any other Participating Company,
the Board, the Administrator, the Committee, any Participant, any Surviving
Spouse, or any other person, except as provided in Section 7.4.
Article
7. Administration of the Plan
7.1. Administration
AT&T shall be the "plan administrator" of the Plan as that term is
defined in ERISA.
7.2. Indemnification
Neither the Administrator, any member of the Board or of the Committee,
nor each other officer to whom any duty or power relating to the administration
or interpretation of the Plan may be allocated or delegated, shall be personally
liable by reason of any contract or other instrument executed by such individual
or on his or her behalf in his or her capacity as the Administrator or as a
member of the Board or of the Committee, nor for any mistake of judgment made in
good faith, and AT&T shall indemnify and hold harmless the Administrator, each
member of the Board, each member of the Committee, and each other employee or
officer to whom any duty or power relating to the administration or
interpretation of the Plan may be allocated or delegated, against any cost or
expense (including attorneys' fees) or liability (including any sum paid in
settlement of a claim) arising out of any act or omission to act in connection
with the Plan unless arising out of such person's own fraud or bad faith.
7.3. Claims Procedure
(a)......All claims for benefit payments under the Plan shall be
submitted in writing by the Participant, Surviving Spouse, Beneficiaries, or any
individual duly authorized by them ("Claimant" for purposes of Section 7.3), to
the Administrator. The Administrator shall notify the Claimant in writing within
90 days after receipt as to whether the claim has been granted or denied. This
period may be extended for up to an additional 90 days in unusual cases provided
that written notice of the extension is furnished to the Claimant prior to the
commencement of the extension. In the event the claim is denied, such notice
shall (i) set forth the specific reasons for denial, (ii) make reference to the
pertinent Plan provisions on which the denial is based, (iii) describe any
additional material or information necessary before the Claimant's request may
be acted upon, and (iv) explain the procedure for appealing the adverse
determination.
(b)......Any Claimant whose claim for benefits has been denied, in
whole or in part, may, within 60 days of receipt of any adverse benefit
determination, appeal such denial to the Committee. All appeals shall be in the
form of a written statement and shall (i) set forth all of the reasons in
support of favorable action on the appeal, (ii) identify those provisions of the
Plan upon which the Claimant is relying, and (iii) include copies of any other
documents or materials which may support favorable consideration of the claim.
The Committee shall decide the issues presented within 60 days after receipt of
such request, but this period may be extended for up to an additional 60 days in
unusual cases provided that written notice of the extension is furnished to the
Claimant prior to the commencement of the extension. The decision of the
Committee shall be set forth in writing, include specific reasons for the
decision, refer to pertinent Plan provisions on which the decision is based, and
shall be final and binding on all persons affected thereby.
Any Claimant whose claim for benefits has been denied shall have such
further rights of review as are provided in ERISA ss. 503, and the Committee anD
Administrator shall retain such right, authority, and discretion as is provided
in or not expressly limited by ERISA ss. 503.
(c)......The Committee shall serve as the final review committee, under
the Plan and ERISA, for the review of all appeals by Claimants whose initial
claims for benefits have been denied, in whole or in part, by the Administrator.
The Committee shall have the authority to determine conclusively for all parties
any and all questions arising from administration of the Plan, and shall have
sole and complete discretionary authority and control to manage the operation
and administration of the Plan, including, but not limited to, authorizing
disbursements according to the Plan, the determination of all questions relating
to eligibility for participation and benefits, interpretation of all Plan
provisions, determination of the amount and kind of benefits payable to any
Participant, Surviving Spouse or Beneficiary, and the construction of disputed
and doubtful terms. Such decisions by the Committee shall be conclusive and
binding on all parties and not subject to further review.
7.4. Named Fiduciaries
AT&T, the Committee, the Pension Plan Administrator(s) and each
Participating Company is each a named fiduciary as that term is used in ERISA
with respect to the particular duties and responsibilities herein provided to be
allocated to each of them.
7.5. Role of the Committee
(a)......The Committee shall have the specific powers elsewhere herein
granted to it and shall have such other powers as may be necessary in order to
enable it to administer the Plan, except for powers herein granted or provided
to be granted to others.
(b)......The procedures for the adoption of by-laws and rules of
procedure and for the employment of a secretary and assistants shall be the same
as are set forth in AT&T Management Pension Plan or the AT&T Pension Plan.
7.6. Allocation of Responsibilities
AT&T may allocate responsibilities for the operation and administration
of the Plan consistent with the Plan's terms, including allocation of
responsibilities to the Committee and the other Participating
Companies. AT&T
and other named fiduciaries may designate in writing other persons to carry out
their respective responsibilities under the Plan, and may employ persons to
advise them with regard to any such responsibilities.
7.7. Multiple Capacities
Any person or group of persons may serve in more than one fiduciary
capacity with respect to the Plan.
Article
8. Amendment and Termination
8.1. Amendment and Termination
Pursuant to ERISA ss. 402(b)(3), the Board or its delegate (acting
pursuant to the Board's delegations of authority then in effect) may from time
to time amend, suspend, or terminate the Plan at any time. Plan amendments may
include, but are not limited to, elimination or reduction in the level or type
of benefits provided prospectively to any class or classes of Participants (and
Surviving Spouses and Beneficiaries). Any and all Plan amendments may be made
without the consent of any Participant, Surviving Spouse or Beneficiary.
Notwithstanding the foregoing, no such amendment, suspension, or termination
shall retroactively impair or otherwise adversely affect the rights of any
Participant, Surviving Spouse, or other person to benefits under the Plan, the
AT&T Management Pension Plan or the AT&T Pension Plan which have arisen prior to
the date of such action.
Article
9. General Provisions
9.1. Binding Effect
The Plan shall be binding upon and inure to the benefit of each
Participating Company and its successors and assigns, and to each Participant,
his or her successors, designees, Beneficiaries, designated annuitants, and
estate. The Plan shall also be binding upon any successor corporation or
organization succeeding to substantially all of the assets and business of AT&T.
Nothing in the Plan shall preclude AT&T from merging or consolidating into or
with, or transferring all or substantially all of its assets to, another
corporation which assumes the Plan and all obligations of AT&T hereunder. AT&T
agrees that it will make appropriate provision for the preservation of the
rights of Participants, Surviving Spouses and Beneficiaries under the Plan in
any agreement or plan or reorganization into which it may enter to effect any
merger, consolidation, reorganization, or transfer of assets. Upon such a
merger, consolidation, reorganization, or transfer of assets, the term
"Participating Company" shall refer to such other corporation and the Plan shall
continue in full force and effect.
9.2. No Guarantee of Employment
Neither the Plan nor any action taken hereunder shall be construed as
(i) a contract of employment or deemed to give any Participant the right to be
retained in the employment of a Participating Company, the right to any level of
compensation, or the right to future participation in the Plan; or (ii)
affecting the right of a Participating Company to discharge or dismiss any
Participant at any time.
9.3. Tax Withholding
AT&T or a Participating Company, as applicable, shall withhold all
federal, state, local, or other taxes required by law to be withheld from Excess
Retirement Benefit payments under the Plan. AT&T shall also withhold all FICA
taxes required by law to be withheld on an Executive's Excess Retirement
Benefits under the Plan.
9.4. Assignment of Benefits
No Excess Retirement Benefit or Excess Death Benefit under this Plan or
any right or interest in such Excess Retirement Benefit or Excess Death Benefit
shall be assignable or subject in any manner to anticipation, alienation, sale,
transfer, claims of creditors, garnishment, pledge, execution, attachment or
encumbrance of any kind, including, but not limited to, pursuant to any domestic
relations order (within the meaning of ERISA ss.
206(d)(3) and Code ss.
414(p)(1)(B)) or judgment or claims for alimony, support, separate maintenance,
and claims in bankruptcy proceedings, and any such attempted disposition shall
be null and void.
9.5. Facility of Payment
If the Administrator shall find that any person to whom any amount is
or was payable under the Plan is unable to care for his or her affairs because
of illness or accident, then any payment, or any part thereof, due to such
person (unless a prior claim therefor has been made by a duly appointed legal
representative), may, if the Administrator so directs AT&T, be paid to the same
person or institution that the benefit with respect to such person is paid or to
be paid under the AT&T Management Pension Plan or AT&T Pension Plan, if
applicable, or the Participant's lawful spouse, a child, a relative, an
institution maintaining or having custody of such person, or any other person
deemed by the Administrator to be a proper recipient on behalf of such person
otherwise entitled to payment. Any such payment shall be in complete discharge
of the liability of AT&T, the Board, the Committee, the Administrator, and the
Participating Company therefor. If any payment to which a Participant, Surviving
Spouse or Beneficiary is entitled under this Plan is unclaimed or otherwise not
subject to payment to the person or persons so entitled, such amounts
representing such payment or payments shall be forfeited after a period of two
years from the date the first such payment was payable and shall not escheat to
any state or revert to any party; provided, however, that any such payment or
payments shall be restored if any person otherwise entitled to such payment or
payments makes a valid claim.
9.6. Severability
If any section, clause, phrase, provision, or portion of this Plan or
the application thereof to any person or circumstance shall be invalid or
unenforceable under any applicable law, such event shall not affect or render
invalid or unenforceable the remainder of this Plan and shall not affect the
application of any section, clause, provision, or portion hereof to other
persons or circumstances.
9.7. Plan Year
For purposes of administering the Plan, each plan year shall begin on
January 1 and end on December 31.
9.8. Headings
The captions preceding the sections and articles hereof have been
inserted solely as a matter of convenience and shall not in any manner define or
limit the scope or intent of any provisions of the Plan.
9.9. Governing Law
The Plan shall be governed by the laws of the State of New Jersey
(other than its conflict of laws provisions) from time to time in effect, except
to the extent such laws are preempted by the laws of the United States of
America.
9.10. Entire Plan
This written Plan document is the final and exclusive statement of the
terms of this Plan, and any claim of right or entitlement under the Plan shall
be determined in accordance with its provisions pursuant to the procedures
described in Article 7. Unless otherwise authorized by the Board or its
delegate, no amendment or modification to this Plan shall be effective until
reduced to writing and adopted pursuant to Section 8.1.