Exhibit 10(a)82
RETENTION AGREEMENT
THIS AGREEMENT, executed on October 23, 2000, and effective
as of July 29, 2000, by and between Entergy Corporation, a
Delaware corporation (Company), and Frank F. Gallaher
(Executive").
WHEREAS, Executive is currently employed by, and serves in
the position of President, Fossil Operations and Transmission of,
Entergy Services, Inc., a System employer;
WHEREAS, Company has entered into an Agreement and Plan of
Merger, by and among Company, FPL Group, Inc., WCB Holding Corp.
(the "Merged Entity"), Ranger Acquisition Corp. and Ring
Acquisition Corp., dated as of July 30, 2000 (the "Ring-Ranger
Merger Agreement");
WHEREAS, Company wishes to encourage Executive to remain
employed by a System employer and provide services to the System;
and
WHEREAS, Executive wishes to remain in the employ of a
System employer and to provide services to the System;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, Company and Executive hereby
agree as follows:
1.Defined Terms. The definitions of capitalized terms used in
this Agreement are provided in the last Section hereof.
2.Covenants Summarized. Company and Executive covenant as
follows:
2.1 Company's Covenants. In order to induce Executive to
remain within the System, Company agrees, under the
conditions described herein, to pay Executive the payments
and benefits described herein upon the circumstances
described in Sections 3, 4 and 6 below. This Agreement
shall not be construed as creating an express or implied
contract of employment and, except as otherwise agreed in
writing between Executive and Company, Executive shall not
have any right to be retained in the employ of any System
Company.
2.2 Executive's Covenants. Executive agrees to the following:
(A) For a period of two years following the Date of
Termination, Executive shall not engage in any
employment or other activity (without the prior
written consent of Company) either in his individual
capacity or together with any other person,
corporation, governmental agency or body, or other
entity, that is (i) listed in the Standard & Poor's
Electric Index or the Dow Jones Utilities Index; or
(ii) in competition with, or similar in nature to,
any business conducted by any System Company at any
time during such period, where such competing
employer is located in, or servicing in any way
customers located in, those parishes and counties in
which any System Company services customers during
such period. In the event of any violation by
Executive of this paragraph (A) of subsection 2.2,
Executive shall repay to Company, within 5 business
days of Company's written request therefor, any
amounts previously paid to him pursuant to subsection
3.3, and Executive shall have no further entitlement
to receive any additional payments or benefits under
such subsections; provided that this subsection
2.2(A) shall not apply to Executive during any period
in which Executive is employed by TRANSCO.
(B) For a period of two years following the Date of
Termination, Executive agrees not to rake any action
or make any statement, written or oral, to any
current or former employee of any System Company, or
to any other person, which disparages any System
Company, its management, directors or shareholders,
or its practices, or which disrupts or impairs their
normal operations, including actions or statements
(i) that would harm the reputation of any System
Company with its clients, suppliers, employees or the
public; or (ii) that would interfere with existing or
prospective contractual or employment relationships
with any System Company or its clients, suppliers or
employees. In the event of any violation by Executive
of this paragraph (B) of this subsection 2.2,
Executive shall repay to Company, within 5 business
days of Company's written request therefor, any
amounts in respect of the Four-Times Severance
Payment previously paid to him pursuant to subsection
3.3, and Executive shall have no further entitlement
to receive any additional payments or benefits under
such subsection; provided that this subsection 2.2
(B) shall not apply to Executive during any period in
which Executive is employed by TRANSCO.
3.Compensation Upon Certain Events. This Section 3 sets forth the
entitlement of Executive or his beneficiary(ies) to certain
payments and benefits under specified circumstances described
in each subsection, and, with the exception of subsection 3.1,
in no event shall Executive and his beneficiary(ies) be
entitled to payments and benefits under more than one such
subsection.
3.1 Physical or Mental Illness. During any period that
Executive fails to perform Executive's full-time duties
within the System as a result of incapacity due to
physical or mental illness, his System employer shall pay
Executive's full salary to Executive at the rate in effect
at the commencement of any such period, together with all
compensation and benefits payable to Executive under the
terms of any compensation or benefit plan, program or
arrangement (other than Company's short- or long-term
disability plan, as applicable) maintained by Company
during such period, until Executive's employment is
terminated by his System employer for Disability.
3.2 Termination of Employment by Company For Cause, or by
Executive Without Good Reason, at Any Time. If Company
should terminate Executive's employment with the System
for Cause at any time or if Executive should
terminate his System employment without Good Reason
at any time, Executive shall be entitled only to
Executive's Accrued Obligations and Normal Post-Termination
Compensation and Benefits.
3.3 Qualifying Termination. If Executive's employment is
terminated due to a Qualifying Termination, then Executive
shall be entitled to (a) either the Service Bridge or
Normal Post-Termination Compensation and Benefits and (b)
receive Executive's Accrued Obligations, Supplemental
Retirement Benefit (in accordance with Executive's
election), EAIP Bonus Award, Four-Times Severance Payment,
Maximum LTIP Award and Other EOP Awards. However, as a
condition of receipt of the Four-Times Severance Payment,
the Chief Executive Officer of Company may require
Executive to remain employed for a period of time not to
extend beyond the Closing, such employment to be on
substantially the same terms and conditions as in effect
on the date of execution of this Agreement. In the event
Executive is entitled to the Service Bridge, Normal Post-
Termination Compensation and Benefits shall be due at the
conclusion of the Service Bridge.
3.4 Termination On Account of Death or Disability. If
Executive's employment should terminate on account of
death or Disability prior to the earlier of termination of
the Merger Agreement or the second anniversary of Closing,
Executive or his personal or legal representatives,
executors, administrators, successors, heirs,
distributees, devisees and legatees (in the event of
death) shall receive Executive's Accrued Obligations, EAIP
Bonus Award, Normal Post-Termination Compensation and
Benefits, Four-Times Severance Payment, Supplemental
Retirement Benefit (in accordance with the election of
Executive or his beneficiary, if applicable), Maximum LTIP
Award and Other EOP Awards. The benefits provided under
this subsection shall be reduced by the benefits provided
to Executive prior to his death or Disability under any
other subsection of this Agreement, with the exception of
subsection 3.1.
4.Gross-Up Payment.
4.1 Regardless of whether Executive becomes entitled to any
payments or benefits under this Agreement, if any of the
payments or benefits received or to be received by
Executive (whether pursuant to the terms of this Agreement
or any other plan, arrangement or agreement with any
System Company) (all such payments and benefits, excluding
the Gross-Up Payment, being hereinafter referred to as the
"Total Payments") will be subject to the Excise Tax,
Company shall pay to Executive an additional amount (the
"Gross-Up Payment") such that the net amount retained by
Executive, after deduction of any Excise Tax on the Total
Payments and any federal, state and local income and
employment taxes and Excise Tax upon the Gross-Up Payment,
shall be equal to the Total Payments.
4.2 For purposes of determining whether any of the Total
Payments will be subject to the Excise Tax and the amount
of such Excise Tax, (i) all of the Total Payments shall be
treated as "parachute payments" (within the meaning of
section 280G(b) (2) of the Code) unless, in the opinion of
tax counsel ("Tax Counsel") reasonably acceptable to
Executive and selected by the accounting firm which was,
immediately prior to the Closing, Company's independent
auditor (the "Auditor"), such payments or benefits (in
whole or in part) do not constitute parachute payments,
including by reason of section 280G(b) (4) (A) of the
Code, (ii) all "excess parachute payments" within the
meaning of section 280G(b) (1) of the Code shall be
treated as subject to the Excise Tax unless, in the
opinion of Tax Counsel, such excess parachute payments (in
whole or in part) represent reasonable compensation for
services actually rendered (within the meaning of section
280G(b) (4) (B) of the Code) in excess of the Base Amount
allocable to such reasonable compensation, or are
otherwise not subject to the Excise Tax, and (iii) the
value of any non-cash benefits or any deferred payment or
benefit shall be determined by the Auditor in accordance
with the principles of sections 280G(d) (3) and (4) of the
Code. For purposes of determining the amount of the Gross-
Up Payment, Executive shall be deemed to pay federal
income tax at the highest marginal rate of federal income
taxation in the calendar year in which the Gross-Up
Payment is to be made and state and local income taxes at
the highest marginal rate of taxation in the state and
locality of Executive's residence on the Date of
Termination (or if there is no Date of Termination, then
the date on which the Gross-Up Payment is calculated for
purposes of this Section 4), net of the maximum reduction
in federal income taxes which could be obtained from
deduction of such state and local taxes.
4.3 In the event that the Excise Tax is finally determined to
be less than the amount taken into account hereunder in
calculating the Gross-Up Payment, Executive shall repay to
Company, within five (5) business days following the time
that the amount of such reduction in the Excise Tax is
finally determined, the portion of the Gross-Up Payment
attributable to such reduction plus that portion of the
Gross-Up Payment attributable to the Excise Tax and
federal, state and local income and employment taxes
imposed on the Gross-Up Payment being repaid by Executive,
to the extent that such repayment results in a reduction
in the Excise Tax and a dollar-for-dollar reduction in
Executive's taxable income and wages for purposes of
federal, state and local income and employment taxes, plus
interest on the amount of such repayment at 120% of the
rate provided in section 1274(b) (2) (B) of the Code. In
the event that the Excise Tax is determined to exceed the
amount taken into account hereunder in calculating the
Gross-Up Payment (including by reason of any payment the
existence or amount of which cannot be determined at the
time of the Gross-Up Payment), Company shall make an
additional Gross-Up Payment in respect of such excess
(plus any interest, penalties or additions payable by
Executive with respect to such excess) within five (5)
business days following the time that the amount of such
excess is finally determined. Executive and Company shall
each reasonably cooperate with the other in connection
with any administrative or judicial proceedings concerning
the existence or amount of liability for Excise Tax with
respect to the Total Payments.
5.Rabbi Trust: Timing of Payments. No later than 180 days from
the execution of this Agreement, Company shall deposit in the
Trust for Deferred Payments of Entergy Corporation and
Subsidiaries ("Trust") an amount as determined by the Auditor
(as defined in Section 4.2) to be necessary to pay all amounts
that would be due under this Agreement if Executive experienced
a Qualifying Termination event on December 31, 2000. Company
shall deposit such additional amounts as determined by the
Auditor from time to time to be necessary to pay amounts due
under the Agreement. The payments provided in Sections 3 and 4
hereof shall be made no later than the fifth business day
following the Date of Termination; provided, however, that if
the amounts of such payments cannot be finally determined on or
before such day, Company shall pay to Executive on such day an
estimate, as determined in good faith by Executive or, in the
case of payments under Section 4 hereof, in accordance with
Section 4 hereof, of the minimum amount of such payments to
which Executive is clearly entitled and shall pay the remainder
of such payments (together with interest on the unpaid
remainder (or on all such payments to the extent Company fails
to make such payments when due) at 120% of the rate provided in
section 12 74(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 Date of Termination. In the event that
the amount of the estimated payments exceeds the amount
subsequently determined to have been due, such excess shall
constitute a loan by Company to Executive, payable on the fifth
business day after demand by Company (together with interest at
120% of the rate provided in section 1274(b) (2) (B) of the
Code). At the time that payments are made under this Agreement,
Company shall provide Executive with a written statement
setting forth the manner in which such payments were calculated
and the basis for such calculations including, without
limitation, any opinions or other advice Company has received
from Tax Counsel, the Auditor or other advisors or consultants
(and any such opinions or advice which are in writing shall be
attached to the statement).
6.Legal Fees. Company also shall pay to Executive all legal fees
and expenses incurred by Executive in disputing in good faith
any issue hereunder relating to the termination of Executive s
employment, in seeking in good faith to obtain or enforce any
benefit or right provided by this Agreement or in connection
with any tax audit or proceeding to the extent attributable to
the application of section 4999 of the Code to any payment or
benefit provided hereunder. Any such payments shall be made
within five (5) business days after delivery of Executive's
written request for payment accompanied with such evidence of
fees and expenses incurred as Company reasonably may require.
7.Superceded Agreements and Benefits. This Agreement supercedes
any other agreements or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof
which have been made by Executive or any System Company,
including any term sheets, offers, or agreements preceding
execution of this Agreement. Notwithstanding any other
provision to the contrary, Executive acknowledges that benefits
provided under this Agreement are in lieu of participation in,
and any payment that might otherwise have been payable under,
the System Executive Continuity Plan of Entergy Corporation and
Subsidiaries and any other System severance or retention plan,
and Executive hereby waives any right to participate in such
plans.
8.Termination Procedures and Compensation During Dispute.
8.1Notice of Termination. Any purported termination of
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
this Section 8. For purposes of this Agreement, a "Notice of
Termination" shall mean a notice which shall indicate the
specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of
Executive's employment under the provision so indicated.
Further, a Notice of Termination for Cause pursuant to
clauses (i) or (ii) of Section 16.6 is required to include a
copy of a resolution duly adopted by the affirmative vote of
not less than three-quarters (3/4) of the entire membership
of the Board at a meeting of the Board which was called and
held for the purpose of considering such termination (after
reasonable notice to Executive and an opportunity for
Executive, together with Executive's counsel, to be heard
before the Board) finding that, in the good faith opinion of
the Board, Executive was guilty of conduct set forth in
clause (i) or (ii) of the definition of Cause herein, and
specifying the particulars thereof in detail.
8.2Date of Termination. "Date of Termination," shall mean (i)
if Executive's employment is terminated for Disability,
thirty (30) days after Notice of Termination is given
(provided that Executive shall not have returned to the full-
time performance of Executive's duties during such thirty
(30) day period), and (ii) if 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 Company, shall not be less than thirty (30) days (except
in the case of a termination for Cause) and, in the case of
a termination by Executive, shall not be less than fifteen
(15) days nor more than sixty (60) days, respectively, from
the date such Notice of Termination is given). Solely for
purposes of determining Executive's "Date of Termination"
for any reason other than termination of the Service Bridge,
Executive's employment shall be considered terminated, even
though he receives the Service Bridge.
8.3Dispute Concerning Termination. If within fifteen (15)
days after any Notice of Termination is given, or, if later,
prior to the Date of Termination (as determined without
regard to this Section 8.3), the party receiving such Notice
of Termination notifies the other party that a dispute
exists concerning the termination, the Date of Termination
shall be extended until the date on which the dispute is
finally resolved, either by mutual written agreement of the
parties or by a final judgment, order or decree of an
arbitrator or a court of competent jurisdiction (which is
not appealable or with respect to which the time for appeal
therefrom has expired and no appeal has been perfected);
provided, however, that the Date of Termination shall be
extended by a notice of dispute given by Executive only if
such notice is given in good faith and Executive pursues the
resolution of such dispute with reasonable diligence.
8.4Compensation During Dispute. If a purported termination
occurs and the Date of Termination is extended in accordance
with Section 8.3 hereof, Company shall continue to pay
Executive the full compensation in effect when the notice
giving rise to the dispute was given (including, but not
limited to, salary) and continue Executive as a participant
in all compensation, benefit and insurance plans in which
Executive was participating when the notice giving rise to
the dispute was given, until the Date of Termination, as
determined in accordance with Section 8.3 hereof. Amounts
paid under this Section 8.4 are in addition to all other
amounts due under this Agreement (other than Executive s
Accrued Obligations) and shall not be offset against or
reduce any other amounts due under this Agreement.
9.No Mitigation. Company agrees that Executive is not required to
seek other employment or to attempt in any way to reduce any
amounts payable to Executive by Company pursuant to Sections 3,
4, or 6 hereof or Section 8.4 hereof. Further, the amount of
any payment or benefit provided for in this Agreement shall not
be reduced by any compensation earned by Executive as the
result of employment by another employer, by retirement
benefits, by offset against any amount claimed to be owed by
Executive to Company, or otherwise (other than (i) as otherwise
provided in subsection 2.2 (A) and (B) and (ii) offsets in
accordance with the provisions of the System Executive
Retirement Plan of Entergy Corporation and Subsidiaries, should
Executive be entitled to and elect to receive the Supplemental
Retirement Benefit in accordance with subsection 16.29(b)).
10. Successors: Binding Agreement.
10.1 In addition to any obligations imposed by law upon any
successor to Company, Company will require any successor
(whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of
the business and/or assets of Company to expressly assume
and agree to perform this Agreement in the same manner and
to the same extent that Company would be required to
perform it if no such succession had taken place. Failure
of Company to obtain such assumption and agreement prior
to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle Executive to
compensation from Company in the same amount and on the
same terms as Executive would be entitled to hereunder if
Executive were to experience a Qualifying Termination,
except that, for purposes of implementing the foregoing,
the date on which any such succession becomes effective
shall be deemed the Date of Termination.
10.2 This Agreement shall inure to the benefit of and be
enforceable by Executive's personal or legal
representatives, executors, administrators, successors,
heirs, distributees, devisees and legatees. If Executive
shall die while any amount would still be payable to
Executive hereunder (other than amounts which, by their
terms, terminate upon the death of Executive) if Executive
had continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the
terms of this Agreement to the executors, personal
representatives or administrators of 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, to the following address
shown below or thereafter 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:
If to Company: If to Executive:
J. Wayne Leonard Frank F. Gallaher
Chief Executive Officer, Entergy Corporation 811 Tete L'ours
639 Loyola Avenue Mandeville, LA 70471
New Orleans, LA 70113-3125
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 Executive
and such officer as may be specifically designated by the
Board. No waiver by either party hereto at any time of any
breach by the other party hereto of, or of any lack of
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. This Agreement supersedes any
other agreements or representations, oral or otherwise, express
or implied, with respect to the subject matter hereof which
have been made by either party. The laws of the State of
Delaware shall govern the validity, interpretation,
construction and performance of this Agreement. All references
to sections of 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 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.
15. Settlement of Disputes; Arbitration.
15.1All claims by Executive for benefits under this Agreement
shall be directed to and determined by the Committee and
shall be in writing. Any denial by the Committee of a
claim for benefits under this Agreement shall be delivered
to Executive in writing and shall set forth the specific
reasons for the denial and the specific provisions of this
Agreement relied upon. The Committee shall afford a
reasonable opportunity to Executive for a review of the
decision denying a claim and shall further allow Executive
to appeal to the Committee a decision of the Committee
within sixty (60) days after notification by the Committee
that Executive's claim has been denied.
15.2Any further dispute or controversy arising under or in
connection with this Agreement shall be settled
exclusively by arbitration in the metropolitan area in
which Executive resides on the Date of Termination (or the
date that the Merger Agreement is terminated, as
applicable) in accordance with the rules of the American
Arbitration Association then in effect; provided, however,
that the evidentiary standards set forth in subsections
16.6 and 16.19 of this Agreement shall be applied by the
arbitrator(s). Judgment may be entered on the arbitrator's
award in any court having jurisdiction. Notwithstanding
any provision of this Agreement to the contrary, Executive
shall be entitled to seek specific performance of
Executive's right to be paid until the Date of Termination
during the pendency of any dispute or controversy arising
under or in connection with this Agreement.
16. Definitions. For purposes of this Agreement, the following
terms shall have the meanings indicated below:
16.1 Accrued Obligations shall mean Executive's Annual Base
Salary through the Date of Termination to the extent not
theretofore paid, together with all unpaid compensation
and benefits, payable to Executive through the later of
the Date of Termination or the Service Bridge under the
terms of Company's compensation and benefit plans,
programs or arrangements as in effect immediately prior to
the Date of Termination or, if more favorable to
Executive, as in effect immediately prior to the first
occurrence of an event or circumstance constituting Good
Reason.
16.2Annual Base Salary shall mean the highest rate of annual
base salary payable to Executive by the System at any time
after July 29, 2000, the date on which the Board
authorized the Chief Executive Officer of Company to enter
this Agreement with Executive.
16.3Auditor shall have the meaning set forth in Section 4.2
hereof.
16.4Base Amount shall have the meaning set forth in section
280G(b) (3) of the Code.
16.5Board shall mean the Board of Directors of Company.
16.6Cause for termination by Company of Executive's employment
shall mean (i) the willful and continued failure by
Executive to substantially perform Executive's System
duties (other than any such failure resulting from
Executive's incapacity due to physical or mental illness
or any such actual or anticipated failure after the
issuance of a Notice of Termination for Good Reason by
Executive pursuant to Section 8.1 hereof) that has not
been cured within 30 days after a written demand for
substantial performance is delivered to Executive by the
Board, which demand specifically identifies the manner in
which the Board believes that Executive has not
substantially performed Executive's duties; (ii) the
willful engaging by Executive in conduct which is
demonstrably and materially injurious to a System Company,
monetarily or otherwise, and which results in a conviction
of or entrance of a plea of guilty or nolo contendere to a
felony; or (iii) Executive's willful failure, as
determined by J. Wayne Leonard, the Company's Chief
Executive Officer as of the date hereof, to support and
use Executive's best efforts to facilitate the
consummation of the transactions contemplated by the
Merger Agreement (until the Merger Agreement may be
terminated) in accordance with Company directives;
provided, however, that it shall not be Cause for
termination under this clause (iii) for Executive, in good
faith, to discuss with members of the Board of Directors,
the Chief Executive Officer of Company, or peer senior
executives of Company, Executive's concerns with,
suggestions regarding, or proposed improvements to, the
merger implementation process. For purposes of clauses (i)
and (ii) of this definition, (x) no act, or failure to
act, on Executive's part shall be deemed "willful" unless
done, or omitted to be done, by Executive in bad faith and
without reasonable belief that Executive's act, or failure
to act, was in the best interest of the System; and (y) in
the event of a dispute concerning the application of this
provision, no claim by Company that Cause exists shall be
given effect unless Company establishes to the Committee
(and to the arbitrator(s) in the event of arbitration of a
dispute or controversy hereunder) by clear and convincing
evidence that Cause exists. For purposes of clauses (i),
(ii), (iii) of this definition, no acts of Executive that
occurred before execution of this Agreement shall be
deemed justification for a Cause claim by Company unless
said acts were unknown to Company management and involved
the commission of a felony injurious to a System Company.
16.7Closing shall mean the earlier to occur of (i)
consummation of the transactions contemplated by the Ring-
Ranger Merger Agreement or (ii) the occurrence of a
"Change in Control" (as defined in Company's Executive
Continuity Plan in effect on the date hereof).
16.8Code shall mean the Internal Revenue Code of 1986, as
amended from time to time.
16.9Committee shall mean (i) the individuals who, on the date
hereof, constitute the Personnel Committee of the Board,
plus (ii) in the event that fewer than three individuals
are available from the group specified in clause (i) above
for any reason, such individuals as may be appointed by
the individual or individuals so available (including for
this purpose any individual or individuals previously so
appointed under this clause (ii)).
16.10Company shall mean Entergy Corporation and shall
include any successor to its business and/or assets which
assumes and agrees to perform this Agreement by operation
of law, or otherwise.
16.11Date of Termination shall have the meaning set forth
in Section 8.2 hereof.
16.12Disability shall be deemed the reason for the
termination by a System employer of Executive's
employment, if, as a result of Executive's incapacity due
to physical or mental illness, Executive shall have been
absent from the full-time performance of Executive s
duties with the System for a period of six (6) consecutive
months, Company shall have given Executive a Notice of
Termination for Disability, and, within thirty (30) days
after such Notice of Termination is given, Executive shall
not have returned to the full-time performance of
Executive's duties.
16.13EAIP shall mean Executive Annual Incentive Plan of
Entergy Corporation and Subsidiaries, or any successor or
replacement plan.
16.14EAIP Bonus Award shall mean the product of (1) the
maximum annual bonus opportunity under the EAIP for the
year in which the Date of Termination occurs and (2) a
fraction, the numerator of which is the number of days in
the fiscal year that includes the Date of Termination and
that are prior to the Date of Termination, and the
denominator of which is 365.
16.15EOP shall mean the Equity Ownership Plan of Entergy
Corporation and Subsidiaries, or any successor or
replacement plan.
16.16Excise Tax shall mean any excise tax imposed under
section 4999 of the Code.
16.17Executive shall mean the individual named in the
first paragraph of this Agreement.
16.18Four-Times Severance Payment shall mean the payment
of a lump sum retention payment, in cash, equal to four
times the sum of (i) Executive's Annual Base Salary and
(ii) Executive's highest maximum annual bonus opportunity
under the EAIP for any fiscal year ending after the date
hereof, which Four-Times Severance Payment shall in no
event be less than $3,700,708.00. The Four-Times Severance
Payment shall be in lieu of any further salary payments to
Executive for periods subsequent to the Date of
Termination (if any) and in lieu of any retention,
severance, termination or similar benefit otherwise
payable to Executive under any plan, program, arrangement
or agreement of or with any System Company.
16.19Good Reason for termination by Executive of
Executive's employment shall mean the occurrence (without
Executive's express written consent) of any one of the
following acts by Company, or failure by Company to act,
unless, in the case of any act or failure to act described
in paragraph (E),(F), or (G) below, such act or failure to
act is corrected prior to the Date of Termination
specified in the Notice of Termination given in respect
thereof:
(A) the substantial reduction or alteration in the
nature or status of Executive's duties or
responsibilities from those in effect on the date of
this Agreement, other than an insubstantial and
inadvertent act that is remedied by Company promptly
after receipt of notice thereof given by Executive and
other than any such alteration primarily attributable to
the fact that Company may no longer be a public company;
(B) a reduction by Company in Executive's annual base
salary as in effect on the date hereof or as the same
may be increased from time to time;
(C) the relocation of Executive's principal place of
employment to a location more than 20 miles from
Executive's principal place of employment on the date
hereof or Company's requiring Executive to be based
anywhere other than such principal place of employment
(or permitted relocation thereof) except for required
travel on Company's business to an extent substantially
consistent with Executive's present business travel
obligations;
(D) the failure by Company to pay to Executive any
portion of Executive's current compensation, or to pay
to Executive any portion of an installment of deferred
compensation under any deferred compensation program of
Company, within seven (7) days of the date such
compensation is due;
(E) the failure by Company to continue in effect any
compensation plan in which Executive participates on or
after the date hereof which is material to Executive's
total compensation, unless an equitable arrangement
(embodied in an ongoing substitute or alternative plan)
has been made with respect to such plan, or the failure
by Company to continue Executive's participation therein
(or in such substitute or alternative plan) on a basis
not materially less favorable, both in terms of the
amount or timing of payment of benefits provided and the
level of Executive's participation relative to other
participants, as existed on the date hereof (or as the
same may be improved after the date hereof);
(F) the failure by Company to continue to provide
Executive with benefits substantially similar to those
enjoyed by Executive under any of Company's pension,
savings, life insurance, medical, health and accident,
or disability plans in which Executive participates on
or after the date hereof, the taking of any other action
by Company which would directly or indirectly materially
reduce any of such benefits or deprive Executive of any
material fringe benefit enjoyed by Executive on or after
the date hereof, or the failure by Company to provide
Executive with the number of paid vacation days to which
Executive is entitled on the basis of years of service
with Company in accordance with Company's normal
vacation policy in effect on the date hereof (or as the
same may be improved after the date hereof); or
(G) any purported termination of Executive's employment
that is not effected pursuant to a Notice of Termination
satisfying the requirements of Section 8.1 hereof; for
purposes of this Agreement, no such purported
termination shall be effective.
Executive's right to terminate Executive's employment for
Good Reason shall not be affected by Executive's
incapacity due to physical or mental illness. 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 hereunder. For purposes of
any determination regarding the existence of Good Reason,
any claim by Executive that Good Reason exists shall be
presumed to be correct unless Company establishes to the
Committee (and to the arbitrator(s) in the event of
arbitration of a dispute or controversy hereunder) by
clear and convincing evidence that Good Reason does not
exist.
16.20Gross-Up Payment shall have the meaning set forth in
Section 4.1 hereof.
16.21LTIP shall mean the Long Term Incentive Program of
the EOP, or any successor or replacement long-term
incentive program.
16.22Maximum LTIP Award shall mean the number of
performance shares or performance share units, as
applicable, that Executive shall be entitled to receive
under the LTIP with respect to any performance period (as
defined in the applicable program or plan) that includes
the Date of Termination, such number to be determined as
if Executive satisfied the remaining performance
requirements and was entitled to the maximum pay out level
under the long term incentive program with respect to such
performance periods.
16.23Merger Agreement shall mean the Ring-Ranger Merger
Agreement or any other agreement, the consummation of the
transactions contemplated by which would constitute a
"Change in Control" under the Company's Executive
Continuity Plan, as in effect on the date hereof.
16.24Normal Post-Termination Compensation and Benefits
shall mean Executive's normal post-termination
compensation and benefits as such payments become due, and
determined under, and paid in accordance with, Company's
retirement, insurance and other compensation or benefit
plans, programs and arrangements as in effect immediately
prior to the Date of Termination or, if more favorable to
Executive, as in effect immediately prior to the
occurrence of the first event or circumstance constituting
Good Reason.
16.25Notice of Termination shall have the meaning set
forth in Section 8.1 hereof.
16.26Other EOP Awards shall mean (a) the vesting of, and
lapse of restrictions on, all restricted shares, stock
options, and other awards (excluding awards under the
LTIP), as applicable, granted to Executive prior to the
Date of Termination, to the extent such shares, options or
other awards have not already vested or restrictions
thereon have not yet lifted and (b) the extension of the
period during which stock options shall be exercisable for
the remainder of the ten-year term extending from the
grant date.
16.27Qualifying Termination shall mean a termination of
Executive's employment (i) by Executive for Good Reason
prior to the earlier of the termination of the Merger
Agreement or the second anniversary of Closing, (ii) by
Company other than for Cause prior to the earlier of
termination of the Merger Agreement or the second
anniversary of Closing.
16.28Service Bridge shall mean, in the event Executive
should lose his position (on the date of this Agreement)
prior to February 28, 2001 (other than for Cause),
Executive's continuation of active System employment at
the same compensation and benefit level as prior to the
loss of such position, with continued eligibility to
participate in all executive plans and programs under
their terms and conditions, through February 28, 2001.
Further, at the conclusion of the Service Bridge,
Executive shall be eligible for retiree benefits, if any,
under Company's plans as in effect on such date or from
time to rime thereafter.
16.29Supplemental Retirement Benefit shall mean, at
Executive's election at the earlier of Closing or Date of
Termination, either (a) a lump sum cash payment equal to
$3,769,808.00, which represents payment in lieu of non-
qualified supplemental retirement benefits earned prior to
the Closing under the System Executive Retirement Plan of
Entergy Corporation and Subsidiaries, the Pension
Equalization Plan of Entergy Corporation and Subsidiaries,
the Supplemental Retirement Plan of Entergy Corporation
and Subsidiaries, and the Post-Retirement Plan of Entergy
Corporation and Subsidiaries, and any supplemental
credited service granted Executive under such plans, or
(b) the benefit available to Executive under the System
Executive Retirement Plan of Entergy Corporation and
Subsidiaries, under the terms and conditions of that plan
applicable to individuals who became participants on or
after March 25, 1998, without reduction of such amount by
the benefit Executive is entitled to receive under any
benefit plan of any prior employer, provided, however,
that Executive shall not require permission under the plan
or otherwise to retire and commence receipt of benefit
payments.
16.30System shall mean Company and all other System
Companies.
16.31System Company(ies) shall mean Company and any other
corporation 80% or more of whose stock (based on voting
power or value) is owned directly or indirectly by Company
and any partnership or trade or business which is 80% of
more controlled, directly or indirectly, by Company, and
any successor to the business and/or assets of any such
entity.
16.32Tax Counsel shall have the meaning set forth in
Section 4.2 hereof.
16.33Total Payments shall mean those payments so described
in Section 4.1 hereof.
16.34TRANSCO shall mean the independent transmission
company that will be formed in accordance with Federal
Energy Regulatory Commission Order No. 2000 and that will
operate the transmission assets of the operating companies
of Company.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written and effective as of July 29,
2000 in accordance with the July 29, 2000 Resolution of the Board
of Directors of Entergy Corporation.
ENTERGY CORPORATION EXECUTIVE
By:/s/ J. Wayne Leonard /s/ Frank F. Gallaher
J. Wayne Leonard Frank F. Gallaher
Chief Executive Officer President, Fossil Operations
and Transmission
Entergy Services, Inc.