EXHIBIT 10.12
THE WILLIAMS COMPANIES, INC.
CHANGE IN CONTROL SEVERANCE AGREEMENT
(TIER ONE EXECUTIVES)
TABLE OF CONTENTS
<Table>
ARTICLE I. Definitions.....................................................1
1.1 "Accrued Annual Bonus"............................................1
1.2 "Accrued Base Salary".............................................1
1.3 "Accrued Obligations".............................................1
1.4 "Affiliate".......................................................1
1.5 "Agreement Date"..................................................2
1.6 "Agreement Term"..................................................2
1.7 "Annual Bonus"....................................................2
1.8 "Article" ........................................................2
1.9 "Base Salary".....................................................2
1.10 "Beneficial Owner".............................................2
1.11 "Beneficiary"..................................................2
1.12 "Board"........................................................2
1.13 "Cause"........................................................2
1.14 "Cause Determination"..........................................3
1.15 "Change Date"..................................................3
1.16 "Change in Control"............................................3
1.17 "Code".........................................................4
1.18 "Competitive Business".........................................4
1.19 "Confidential Information".....................................5
1.20 "Consummation Date"............................................5
1.21 "Disability"...................................................6
1.22 "Disability Effective Date"....................................6
1.23 "Employer".....................................................6
1.24 "ERISA"........................................................6
1.25 "Exchange Act".................................................6
1.26 "Good Reason"..................................................6
1.27 "Gross-Up Payment".............................................8
1.28 "including"....................................................8
1.29 "IRS"..........................................................8
1.30 "Legal and Other Expenses".....................................8
1.31 "Lump Sum Value"...............................................8
1.32 "Merger of Equals".............................................8
1.33 "Merger of Equals Cessation Date"..............................9
1.34 "Merger of Equals Cessation Notice"............................9
1.35 "Non-Qualified Plan"...........................................9
1.36 "Notice of Consideration"......................................9
1.37 "Notice of Termination"........................................9
1.38 "Person"......................................................10
1.39 "Post-Change Period"..........................................10
1.40 "Post-Merger of Equals Period"................................10
1.41 "Potential Parachute Payment".................................10
1.42 "Pro-rata Annual Bonus".......................................10
1.43 "Reorganization Transaction"..................................10
</Table>
<Table>
1.44 "Restricted Shares"...........................................10
1.45 "SEC".........................................................10
1.46 "Section".....................................................10
1.47 "SERP"........................................................10
1.48 "Stock Options"...............................................10
1.49 "Subsidiary" .................................................10
1.50 "Surviving Corporation".......................................10
1.51 "Target Annual Bonus".........................................10
1.52 "Taxes".......................................................11
1.53 "Termination Date"............................................11
1.54 "Termination of Employment"...................................11
1.55 "Voting Securities"...........................................12
1.56 "Williams"....................................................12
1.57 "Williams Incumbent Directors"................................12
1.58 "Williams Parties"............................................12
1.59 "Work Product"................................................12
ARTICLE II. Williams' Obligations Upon Termination of Employment..........12
2.1 If by Executive for Good Reason or by an Employer
Other Than for Cause or Disability..............................12
2.2 If by the Employer for Cause.....................................15
2.3 If by a Participant Other Than for Good Reason...................17
2.4 If by Death or Disability........................................17
2.5 Waiver and Release...............................................17
2.6 Breach of Covenants..............................................17
ARTICLE III. Certain Additional Payments by Williams......................18
3.1 Gross-Up Payment.................................................18
3.2 Gross-Up Payment.................................................18
3.3 Limitation on Gross-Up Payments..................................18
3.4 Additional Gross-up Amounts......................................18
3.5 Amount Increased or Contested....................................19
3.6 Refunds..........................................................21
ARTICLE IV. Expenses and Interest.........................................21
4.1 Legal and Other Expenses.........................................21
4.2 Interest.........................................................21
ARTICLE V. No Set-off or Mitigation.......................................22
5.1 No Set-off by Williams...........................................22
5.2 No Mitigation....................................................22
ARTICLE VI. Restrictive Covenants.........................................22
6.1 Confidential Information.........................................22
6.2 Non-Competition..................................................23
6.3 Non-Solicitation.................................................23
</Table>
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<Table>
6.4 Intellectual Property............................................24
6.5 Non-Disparagement................................................25
6.6 Reasonableness of Restrictive Covenants..........................25
6.7 Right to Injunction: Survival of Undertakings....................25
ARTICLE VII. Non-Exclusivity of Rights....................................26
7.1 Waiver of Certain Other Rights...................................26
7.2 Other Rights.....................................................26
7.3 No Right to Continued Employment.................................27
ARTICLE VIII. Claims Procedures...........................................27
8.1 Filing a Claim...................................................27
8.2 Review of Claim Denial...........................................27
ARTICLE IX. Miscellaneous.................................................27
9.1 No Assignability.................................................27
9.2 Successors.......................................................28
9.3 Payments to Beneficiary..........................................28
9.4 Non-Alienation of Benefits.......................................28
9.5 Severability.....................................................28
9.6 Amendments.......................................................28
9.7 Notices..........................................................28
9.8 Joint and Several Liability......................................29
9.9 Counterparts.....................................................29
9.10 Governing Law.................................................29
9.11 Captions......................................................29
9.12 Number and Gender.............................................29
9.13 Tax Withholding...............................................29
9.14 No Rights Prior to Change Date................................29
9.15 Entire Agreement..............................................30
</Table>
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THE WILLIAMS COMPANIES, INC.
CHANGE-IN-CONTROL SEVERANCE AGREEMENT
THIS AGREEMENT dated as of (Effective_Date), (the "Agreement Date") is
made by and between The Williams Companies, Inc., a corporation incorporated
under the laws of the State of Delaware (together with successors thereto,
"Williams"), and (Name) ("Executive").
RECITALS
The Board of Directors of Williams (the "Board") has determined that it
is in the best interests of Williams and its shareholders to encourage and
motivate the Executive to devote his full attention to the performance of his
assigned duties without the distraction of concerns regarding his involuntary or
constructive termination of employment due to a Change in Control of Williams.
The Executive is employed by Williams or a Subsidiary and may from time to time
be employed by one or more Subsidiaries. Williams and its Subsidiaries believe
that it is in the best interest of the Executive, their customers, the
communities they serve, and the stockholders of Williams to provide financial
assistance through severance payments and other benefits to Executive if
Executive is involuntarily or constructively terminated upon or within a certain
period after a Change in Control. This Agreement is intended to accomplish these
objectives.
This Agreement supersedes and replaces all other written or oral
exchanges, agreements, understandings, or arrangements between or among
Executive and Williams and/or the Subsidiary entered into prior to the date
hereof and relating to severance or benefits in relation to a Change in Control,
including, but not limited to the Williams Companies, Inc. Change in Control
Severance Protection Plan as effective January 1, 1990 and amended and restated
June 1, 1999.
ARTICLE I.
DEFINITIONS
As used in this Agreement, the terms specified below shall have the
following meanings:
1.1 "Accrued Annual Bonus" means the amount of any Annual Bonus earned
but not yet paid as of the Termination Date, other than amounts Executive has
elected to defer.
1.2 "Accrued Base Salary" means the amount of Executive's Base Salary
that is accrued but not yet paid as of the Termination Date, other than amounts
Executive has elected to defer.
1.3 "Accrued Obligations" means, as of any date, the sum of Executive's
Accrued Base Salary, Accrued Annual Bonus, any accrued but unpaid paid time off,
and any other amounts and benefits which are then due to be paid or provided to
Executive by Williams (other than pursuant to Section 2.1(a)(iii)(A) and (B)),
but have not yet been paid or provided (as applicable).
1.4 "Affiliate" means any Person (including a Subsidiary) that directly
or indirectly, through one or more intermediaries, controls, or is controlled by
or is under common control with Williams. For purposes of this definition the
term "control" with respect to any Person
means the power to direct or cause the direction of management or policies of
such Person, directly or indirectly, whether through the ownership of Voting
Securities, by contract or otherwise.
1.5 "Agreement Date" -- see the introductory paragraph of this
Agreement.
1.6 "Agreement Term" means the period commencing on the Agreement Date
and ending on the second anniversary of the Agreement Date or, if later, such
later date to which the Agreement Term is extended under the following sentence,
unless earlier terminated as provided herein. Commencing on the first
anniversary of the Agreement Date, the Agreement Term shall automatically be
extended each day by one day to create a new two-year term until, at any time
after the first anniversary of the Agreement Date, Williams delivers written
notice (an "Expiration Notice") to Executive that the Agreement shall expire on
a date specified in the Expiration Notice (the "Expiration Date") that is not
less than 12 months after the date the Expiration Notice is delivered to
Executive; provided, however, that if a Change Date, or Merger of Equals occurs
before the Expiration Date specified in the Expiration Notice, then such
Expiration Notice shall be void and of no further effect. Notwithstanding
anything herein to the contrary, the Agreement Term shall end at the end of the
Severance Period (as defined in Section 2.1(c))if applicable, or if there is no
Severance Period, the earliest of the following: (a) the second anniversary of
the Change Date, or (b) the Termination Date.
1.7 "Annual Bonus" means the opportunity to receive payment of a cash
annual incentive.
1.8 "Article" means an article of this Agreement.
1.9 "Base Salary" means annual base salary in effect on the Termination
Date, disregarding any reduction that would qualify as Good Reason.
1.10 "Beneficial Owner" means such term as defined in Rule 13d-3 of the
SEC under the Exchange Act.
1.11 "Beneficiary" -- see Section 9.3.
1.12 "Board" means the Board of Directors of Williams or, from and
after the Change Date that gives rise to a Surviving Corporation, the Board of
Directors of such Surviving Corporation.
1.13 "Cause" means any one or more of the following:
(a) Executive's conviction of or plea of nolo contendere to a felony or
other crime involving fraud, dishonesty or moral turpitude;
(b) Executive's willful or reckless material misconduct in the
performance of his duties which results in an adverse effect on Williams, the
Subsidiary or an Affiliate;
(c) Executive's willful or reckless violation or disregard of the code
of business conduct;
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(d) Executive's material willful or reckless violation or disregard of
a Williams or Subsidiary policy; or
(e) Executive's habitual or gross neglect of duties;
provided, however, that for purposes of clauses (b) and (e), Cause shall not
include any one or more of the following:
(i) bad judgment or negligence, other than Executive's
habitual neglect of duties or gross negligence;
(ii) any act or omission believed by Executive in good faith
to have been in or not opposed to the interest of Williams, the
Subsidiary or an Affiliate (without intent of Executive to gain,
directly or indirectly, a profit to which Executive was not legally
entitled);
(iii) any act or omission with respect to which a
determination could properly have been made by the Board that Executive
had satisfied the applicable standard of conduct for indemnification or
reimbursement under Williams' by-laws, any applicable indemnification
agreement, or applicable law, in each case as in effect at the time of
such act or omission; or
(iv) during a Post-Change Period other than a Post-Merger of
Equals Period, failure to meet performance goals, objectives or
measures following good faith efforts to meet such goals, objectives or
measures; and
further provided that, for purposes of clauses (b) through (e), if an act, or a
failure to act, which was done, or omitted to be done, by Executive in good
faith and with a reasonable belief that Executive's act, or failure to act, was
in the best interests of Williams, the Subsidiary or an Affiliate or was
required by applicable law or administrative regulation, such breach shall not
constitute Cause if, within 10 days after Executive is given written notice of
such breach that specifically refers to this Section, Executive cures such
breach to the fullest extent that it is curable.
1.14 "Cause Determination" --see Section 2.2(b)(iv)
1.15 "Change Date" means the date on which a Change in Control first
occurs during the Agreement Term.
1.16 "Change in Control" means, except as otherwise provided below, the
occurrence of any one or more of the following during the Agreement Term:
(a) any person (as such term is used in Rule 13d-5 of the SEC under the
Exchange Act) or group (as such term is defined in Sections 3(a)(9) and 13(d)(3)
of the Exchange Act), other than an Affiliate of Williams or any employee
benefit plan (or any related trust) sponsored or maintained by Williams or any
of its Affiliates (a "Related Party"), becomes the Beneficial Owner of 20% or
more of the common stock of Williams or of Voting Securities representing 20% or
more of the combined voting power of all Voting Securities of Williams,
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except that no Change in Control shall be deemed to have occurred solely by
reason of such beneficial ownership by a Person (a "Similarly Owned Company")
with respect to which both more than 75% of the common stock of such Person and
Voting Securities representing more than 75% of the combined voting power of the
Voting Securities of such Person are then owned, directly or indirectly, by the
persons who were the direct or indirect owners of the common stock and Voting
Securities of Williams immediately before such acquisition, in substantially the
same proportions as their ownership, immediately before such acquisition, of the
common stock and Voting Securities of Williams, as the case may be; or
(b) Williams Incumbent Directors (determined using the Agreement Date
as the baseline date) cease for any reason to constitute at least a majority of
the directors of Williams then serving; or
(c) consummation of a merger, reorganization, recapitalization,
consolidation, or similar transaction (any of the foregoing, a "Reorganization
Transaction"), other than a Reorganization Transaction that results in the
Persons who were the direct or indirect owners of the outstanding common stock
and Voting Securities of Williams immediately before such Reorganization
Transaction becoming, immediately after the consummation of such Reorganization
Transaction, the direct or indirect owners, of both at least 65% of the
then-outstanding common stock of the Surviving Corporation and Voting Securities
representing at least 65% of the combined voting power of the then-outstanding
Voting Securities of the Surviving Corporation, in substantially the same
respective proportions as such Persons' ownership of the common stock and Voting
Securities of Williams immediately before such Reorganization Transaction; or
(d) approval by the stockholders of Williams of a plan or agreement for
the sale or other disposition of all or substantially all of the consolidated
assets of Williams or a plan of complete liquidation of Williams, other than any
such transaction that would result in (i) a Related Party owning or acquiring
more than 50% of the assets owned by Williams immediately prior to the
transaction or (ii) the Persons who were the direct or indirect owners of the
outstanding common stock and Voting Securities of Williams immediately before
such transaction becoming, immediately after the consummation of such
transaction, the direct or indirect owners, of more than 50% of the assets owned
by Williams immediately prior to the transaction.
Notwithstanding the occurrence of any of the foregoing events, a Change in
Control shall not occur with respect to Executive if, in advance of such event,
Executive agrees in writing that such event shall not constitute a Change in
Control.
1.17 "Code" means the Internal Revenue Code of 1986, as amended.
1.18 "Competitive Business" means, as of any date, any energy business
and any individual or entity (and any branch, office, or operation thereof)
which engages in, or proposes to engage in (with Executive's assistance) any of
the following in which the Executive has been engaged in the twelve (12) months
preceding the Termination Date (i) the harnessing, production, transmission,
distribution, marketing or sale of oil, gas or other energy product or the
transmission or distribution thereof through pipelines, wire or cable or similar
medium (ii) any
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other business actively engaged in by Williams which represents for any calendar
year or is projected by Williams (as reflected in a business plan adopted by
Williams before Executive's Termination Date) to yield during any year during
the first three-fiscal year period commencing on or after Executive's
Termination Date, more than 5% of the gross revenue of Williams, and, in either
case, which is located (x) anywhere in the United States, or (y) anywhere
outside of the United States where Williams is then engaged in, or proposes as
of the Termination Date to engage in to the knowledge of the Executive, any of
such activities.
1.19 "Confidential Information" means any information, ideas,
processes, methods, designs, devices, inventions, data, techniques, models and
other information developed or used by Williams or any Affiliate and not
generally known in the relevant trade or industry relating to Williams' or its
Affiliates' products, services, businesses, operations, employees, customers or
suppliers, whether in tangible or intangible form, which gives Williams and its
Affiliates a competitive advantage in the harnessing, production, transmission,
distribution, marketing or sale of oil, gas or other energy or the transmission
or distribution thereof through pipelines, wire or cable or similar medium or in
the energy services or energy trading industry and other businesses in which
Williams or an Affiliate is engaged, or of third parties which Williams or
Affiliate is obligated to keep confidential, or which was learned, discovered,
developed, conceived, originated or prepared during or as a result of
Executive's performance of any services on behalf of Williams or any Affiliate,
and which falls within any of the following general categories:
(a) information relating to trade secrets of Williams or any Affiliate
or any customer or supplier of Williams or any Affiliate;
(b) information relating to existing or contemplated products,
services, technology, designs, processes, formulae, algorithms, research or
product developments of Williams or any Affiliate or any customer or supplier of
Williams or any Affiliate;
(c) information relating to business plans or strategies, sales or
marketing methods, methods of doing business, customer lists, customer usages
and/or requirements, supplier information of Williams or any Affiliate or any
customer or supplier of Williams or any Affiliate; information subject to
protection under the Uniform Trade Secrets Act, as adopted by the State of
Oklahoma, or to any comparable protection afforded by applicable law; or
(d) any other confidential information which either Williams or any
Affiliate or any customer or supplier of Williams or any Affiliate may
reasonably have the right to protect by patent, copyright or by keeping it
secret and confidential.
(e) Notwithstanding the foregoing, Confidential Information shall not
include: (i) information that is or becomes generally known through no fault of
Executive; (ii) information received from a third party outside of Williams that
was disclosed without a breach of any confidentiality obligation; or (iii)
information approved for release by written authorization of Williams.
1.20 "Consummation Date" means the date on which a Reorganization
transaction is consummated.
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1.21 "Disability" means any medically determinable physical or mental
impairment of Executive that:
(a) has lasted for a continuous period of not less than (i) six months
or (ii) such longer period, if any, that is available to Executive under his
Employer's policies relating to the continuation of employee status after the
onset of disability, as such policies are applicable to other peer executives of
the Employer immediately prior to the Change Date,
(b) can be expected to be permanent or of indefinite duration, and
(c) renders Executive substantially unable to perform his duties.
The Employer shall provide or cause to be provided Executive or his legal
representative, as applicable, (i) written notice in accordance with Section 9.7
of the intention of Executive's employer to terminate his employment for
Disability and (ii) a certification of Executive's Disability by a physician
selected by the Employer or its insurers, subject to the consent of Executive or
his legal representative, which consent shall not be unreasonably withheld or
delayed. Executive's employment shall terminate effective on the 30th day (the
"Disability Effective Date") after his receipt of such notice unless, before the
Disability Effective Date, he shall have resumed the full-time performance of
his duties.
1.22 "Disability Effective Date" -- see the definition of "Disability".
1.23 "Employer" means Williams or, if Executive is not employed
directly by Williams, the Subsidiary that from time to time employs Executive on
or after the Agreement Date, and the successor of either (provided, in the case
of a Subsidiary, that such successor is also a Subsidiary).
1.24 "ERISA" means the Employee Retirement Income security Act of 1974,
as amended.
1.25 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
1.26 "Good Reason" means a Termination of Employment by Executive in
accordance with the substantive and procedural provisions of this Section.
(a) Termination of Employment by Executive for "Good Reason" means a
Termination of Employment initiated by Executive on account of any one or more
of the following actions or omissions that, unless otherwise specified, occurs
during a Post-Change Period:
(i) a material adverse reduction in the nature or scope of
Executive's office, position, duties, functions, responsibilities or
authority (including reporting responsibilities and authority) during a
Post-Change Period other than a Merger of Equals from the most
significant of those held, exercised and assigned at any time during
the 90-day period immediately before the later of (x) the Change Date
or (y) the Merger of Equals Cessation Date;
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(ii) any reduction in or failure to pay Executive's annual
Base Salary at an annual rate not less than 12 times the highest
monthly base salary paid or payable to Executive by his Employer in
respect of the 12-month period immediately before the Change Date;
(iii) any reduction in the Target Annual Bonus which Executive
may earn determined as of the Change Date or failure to pay Executive's
Annual Bonus on terms substantially equivalent to those provided to
peer executives of the Employer;
(iv) a material reduction of Executive's aggregate
compensation and/or aggregate benefits from the amounts and/or levels
in effect on the Change Date, unless such reduction is part of a Policy
applicable to peer executives of the Employer and of any successor
entity;
(v) required relocation during a Post-Change Period other than
a Post-Merger of Equals Period of more than 50 miles of (A) Executive's
workplace, or (B) the principal offices of the Employer or its
successor (if such offices are Executive's workplace), in each case
without the consent of Executive; provided, however, in both cases of
(A) and (B) of this subsection (v), such new location is farther from
Executive's residence than the prior location;
(vi) the failure at any time of a successor to Executive's
Employer explicitly to assume and agree to be bound by this Agreement;
provided, however, that the failure of a business unit or the Employer,
which has been sold, spun-off or otherwise disaggregated by the
Employer, to assume this Agreement during a Post-Merger of Equals
Period shall not qualify as Good Reason for purposes of this clause
(vi); or
(vii) the giving of a Notice of Consideration pursuant to
Section 2.2(b)(ii) or Section 2.2(d) and the subsequent failure to
terminate Executive for Cause and within a period of 90 days thereafter
in compliance with all of the substantive and procedural requirements
of Section 2.2;
(b) Notwithstanding anything in this Agreement to the contrary, no act
or omission shall constitute grounds for "Good Reason":
(i) Unless Executive gives a Notice of Termination to Williams
and the Employer 30 days prior to his intent to terminate his
employment for Good Reason which describes the alleged act or omission
giving rise to Good Reason; and
(ii) Unless such Notice of Termination is given within 90 days
of Executive's first actual knowledge of such act or omission, or if
such act or omission would not constitute Good Reason during a
Post-Merger of Equals Period, unless Executive's Termination Date is
within 90 days after the first date on which he first obtained actual
knowledge of the fact that no Merger of Equals has occurred or that a
Merger of Equals Cessation has occurred; and
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(iii) Unless Williams or the Employer fails to cure such act
or omission within the 30 day period after receiving the Notice of
Termination; and
(iv) If Executive has consented in writing to such act or
omission in a document that makes specific reference to this Section.
1.27 "Gross-Up Payment" -- see Section 3.1.
1.28 "including" means including without limitation.
1.29 "IRS" means the Internal Revenue Service of the United States of
America.
1.30 "Legal and Other Expenses" -- see Section 4.1.
1.31 "Lump Sum Value" of an annuity payable pursuant to a defined
benefit plan means, as of a specified date, the present value of such annuity,
as determined as of such date, under generally accepted actuarial principles
using (a) the applicable interest rate, mortality tables and other methods and
assumptions that the Pension Benefit Guaranty Corporation ("PBGC") would use in
determining the value of an immediate annuity on the Termination Date or (b) if
such interest rate and mortality assumptions are no longer published by the
PBGC, interest rate and mortality assumptions determined in a manner as similar
as practicable to the manner by which the PBGC's interest rate and mortality
assumptions were determined immediately prior to the PBGC's cessation of
publication of such assumptions; provided, however, that if such defined benefit
plan provides for a lump sum distribution, then "Lump Sum Value" shall mean such
lump sum amount.
1.32 "Merger of Equals" means, as of any date, a Reorganization
Transaction that, notwithstanding the fact that such transaction may also
qualify as a Change in Control, satisfies all of the conditions set forth in
subsections (a), (b) and (c) below:
(a) less than 65%, but not less than 50%, of the common stock of the
Surviving Corporation outstanding immediately after the consummation of the
Reorganization Transaction, together with Voting Securities representing less
than 65%, but not less than 50%, of the combined voting power of all Voting
Securities of the Surviving Corporation outstanding immediately after such
consummation shall be owned, directly or indirectly, by the persons who were the
owners directly or indirectly of the common stock and Voting Securities of
Williams immediately before such consummation in substantially the same
proportions as their respective direct or indirect ownership, immediately before
such consummation, of the common stock and Voting Securities of Williams,
respectively; and
(b) Williams Incumbent Directors (determined using the date immediately
preceding the Consummation Date as the baseline date) shall, throughout the
period beginning on the Consummation Date and ending on the second anniversary
of the Consummation Date, continue to constitute not less than 50% of the
members of the Board; and
(c) the person who was the Chief Executive Officer of Williams
immediately prior to the Consummation Date shall serve as the Chief Executive
Officer of the Surviving
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Corporation at all times during the period commencing on the Consummation Date
and ending on the first anniversary of the Consummation Date;
provided, however, that a Reorganization Transaction that qualifies as a Merger
of Equals shall cease to qualify as a Merger of Equals (a "Merger of Equals
Cessation") and shall instead qualify as a Change in Control that is not a
Merger of Equals from and after the first date during the Post-Change Period
(such date, the "Merger of Equals Cessation Date") as of which any one or more
of the following shall occur for any reason:
(i) any condition of subsection (a) of this Section shall for
any reason not be satisfied immediately after the consummation of the
Reorganization Transaction; or
(ii) as of the close of business on any date on or after the
Consummation Date and before the second anniversary of the Change Date,
any condition of subsections (a) and/or (b) of this Section shall not
be satisfied; or
(iii) on any date prior to the first anniversary of the
Consummation Date, Williams shall make a filing with the SEC, issue a
press release, or make a public announcement to the effect that the
Chief Executive Officer of Williams has resigned or will resign or be
terminated, other than on account of a scheduled retirement, or
Williams is seeking or intends to seek a replacement for the then-Chief
Executive Officer of Williams, whether such resignation, termination or
replacement is to become effective before or after such first
anniversary of the Consummation Date.
Williams shall give Executive written notice, in accordance with Section 9.7, of
any Merger of Equals Cessation and the applicable Merger of Equals Cessation
Date as soon as practicable after the Merger of Equals Cessation Date.
1.33 "Merger of Equals Cessation Date" - see the definition of "Merger
of Equals."
1.34 "Merger of Equals Cessation Notice" means a written notice given
in accordance with Section 9.7 by the Employer to notify Executive of the facts
and circumstances of a Merger of Equals Cessation, including the Merger of
Equals Cessation Date.
1.35 "Non-Qualified Plan" means any deferred compensation plan,
program, policy, practice or procedure (including a SERP) that is not qualified
under Section 401(a) of the Code, and which is sponsored by Williams, the
Employer, or the Surviving Corporation.
1.36 "Notice of Consideration" -- see Section 2.2(b)(ii).
1.37 "Notice of Termination" means a written notice of a Termination of
Employment given in accordance with Section 9.7 that sets forth (a) the specific
termination provision in this Agreement relied on by the party giving such
notice, (b) in reasonable detail the specific facts and circumstances claimed to
provide a basis for such Termination of Employment, and (c) if the Termination
Date is other than the date of receipt of such Notice of Termination, the
Termination Date.
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1.38 "Person" means any individual, sole proprietorship, partnership,
joint venture, limited liability company, trust, unincorporated organization,
association, corporation, institution, public benefit corporation, entity or
government instrumentality, division, agency, body or department.
1.39 "Post-Change Period" means the period commencing on the Change
Date and ending on the earlier of the Termination Date or the second anniversary
of the Change Date.
1.40 "Post-Merger of Equals Period" means the period commencing on the
Consummation Date that qualifies as a Merger of Equals and ending on the second
anniversary of such Consummation Date or, if sooner, the Merger of Equals
Cessation Date.
1.41 "Potential Parachute Payment" - see Section 3.1.
1.42 "Pro-rata Annual Bonus" means, in respect of an Employer's fiscal
year during which the Termination Date occurs, an amount equal to the product of
Executive's Target Annual Bonus (determined as of the Termination Date)
multiplied by a fraction, the numerator of which equals the number of days from
and including the first day of such fiscal year through and including the
Termination Date, and the denominator of which equals 365.
1.43 "Reorganization Transaction" -- see clause (c) of the definition
of "Change in Control".
1.44 "Restricted Shares" means shares of restricted stock, restricted
stock units, deferred stock or similar awards.
1.45 "SEC" means the United States Securities and Exchange Commission.
1.46 "Section" means, unless the context otherwise requires, a section
of this Agreement.
1.47 "SERP" means a supplemental executive retirement plan that is a
Non-Qualified Plan.
1.48 "Stock Options" means stock options, stock appreciation rights or
similar awards.
1.49 "Subsidiary" means an Affiliate with respect to which Williams
owns, directly or indirectly, Voting Securities representing more than 50% of
the aggregate voting power of the then-outstanding Voting Securities. Status as
a Subsidiary shall cease if Williams ceases own, directly, or indirectly, more
than 50% of such aggregate voting power.
1.50 "Surviving Corporation" means the corporation resulting from a
Reorganization Transaction or, if securities representing at least 50% of the
aggregate voting power of all Voting Securities of such resulting corporation
are directly or indirectly owned by another corporation, such other corporation.
1.51 "Target Annual Bonus" means, as of any date, the amount equal to
the product of Executive's Base Salary determined as of such date multiplied by
the percentage of such Base
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Salary to which Executive would have been entitled immediately prior to such
date under any Annual Bonus arrangement for the fiscal year for which the Annual
Bonus is awarded if the performance goals established pursuant to such Annual
Bonus were achieved at the 100% level as of the end of the fiscal year;
provided, however, that if Executive's Annual Bonus is discretionary and no 100%
target level is formally established either under the Annual Bonus arrangement
or otherwise, Executive's "Target Annual Bonus" shall mean the amount equal to
the 50% of Executive's Base Salary.
1.52 "Taxes" means federal, state, local and other income, employment
and other taxes.
1.53 "Termination Date" means the date of the receipt of the Notice of
Termination by Executive (if such notice is given by Executive's Employer) or by
Executive's Employer (if such notice is given by Executive), or any later date,
not more than 30 days after the giving of such notice, specified in such notice;
provided, however, that:
(a) Executive's employment is terminated by reason of death or
Disability, the Termination Date shall be the date of Executive's death or the
Disability Effective Date, as applicable, regardless of whether a Notice of
Termination has been given; and
(b) if no Notice of Termination is given, the Termination Date shall be
the last date on which Executive is employed by an Employer;
(c) if Notice of Termination is given during a Post-Merger of Equals
Period, then the Termination Date shall be deemed to be in the Post-Merger of
Equals Period, whether or not a Merger of Equals Cessation date occurs prior to
the Termination Date; and
(d) for purposes of Article VI (Restrictive Covenants) if the Executive
does not have a Termination of Employment, the Termination Date shall be the
later of the date the entity that employs Executive ceases to be a Subsidiary,
or, after a Disaggregation (as defined in Section 1.54), the date Executive's
employment with the successor business unit terminates, whether such termination
is initiated by such successor or by Executive.
1.54 "Termination of Employment" means, in respect of Executive, any
cessation of Executive's employment with Williams and its Subsidiaries, whether
such cessation occurs (a) on the initiative of the Employer or Executive or (b)
by reason of the death of Executive; provided that for the purposes of Article
II, (i) the mere cessation of a Subsidiary's status as a Subsidiary shall not
effect a Termination of Employment, and (ii) if the Executive's cessation of
employment with Williams and its Subsidiaries is effected through a sale,
spin-off or other disaggregation ("Disaggregation") by Williams or an Affiliate
of the business unit (including but not limited to the Subsidiary) which
employed Executive immediately prior to such Disaggregation ("Transfer"),
whether such Disaggregation occurs before or after a Change in Control, and if
Executive is employed in substantially the same position (without regard to
reporting obligations) by the successor to such business unit immediately
following the Transfer, then the Disaggregation shall not be deemed to effect a
"Termination of Employment," nor shall a subsequent termination of employment or
job restructuring with such business unit after the Disaggregation be deemed to
effect a "Termination of Employment."
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1.55 "Voting Securities" of a corporation means securities of such
corporation that are entitled to vote generally in the election of directors of
such corporation.
1.56 "Williams" -- see the introductory paragraph of this Agreement.
1.57 "Williams Incumbent Directors" means, determined as of any date by
reference to any baseline date:
(a) the members of the Board on the date of such determination who have
been members of the Board since such baseline date, and
(b) the members of the Board on the date of such determination who were
appointed or elected after such baseline date and whose election, or nomination
for election by stockholders of Williams or the Surviving Corporation, as
applicable, was approved by a vote or written consent of two-thirds (or by a
simple majority for purposes of subsection (b) of the definition of "Merger of
Equals") of the directors comprising the Williams Incumbent Directors on the
date of such vote or written consent, but excluding each such member whose
initial assumption of office was in connection with (i) an actual or threatened
election contest, including a consent solicitation, relating to the election or
removal of one or more members of the Board, (ii) a "tender offer" (as such term
is used in Section 14(d) of the Exchange Act), (iii) a proposed Reorganization
Transaction, or (iv) a request, nomination or suggestion of any Beneficial Owner
of Voting Securities representing 20% or more of the aggregate voting power of
the Voting Securities of Williams or the Surviving Corporation, as applicable.
1.58 "Williams Parties" means Williams and Executive's Employer.
1.59 "Work Product" means all ideas, inventions and business plans that
Executive makes, conceives, discovers or develops alone or with others during
the course of Executive's employment with Williams or during the one year period
following Executive's Termination Date, including any inventions, modifications,
discoveries, developments, improvements, computer programs, processes, products
or procedures (whether or not protectable upon application by copyright, patent,
trademark, trade secret or other proprietary rights).
ARTICLE II.
WILLIAMS' OBLIGATIONS UPON TERMINATION OF EMPLOYMENT
2.1 If by Executive for Good Reason or by an Employer Other Than for
Cause or Disability. If Executive has a Termination of Employment for Good
Reason or there is an Employer-initiated Termination of Employment of the
Executive for any reason other than Cause or Disability during the Post-Change
Period, then Williams' and the Employer's sole obligations to Executive under
this Article II shall be as follows:
(a) Severance Payments. Executive shall be paid a lump-sum cash amount
equal to the sum of the following, no more than ten (10) business days after the
Termination Date (provided, however, such lump-sum amount shall be paid no more
than 30 business days after a Termination Date that occurs during a Post-Merger
of Equals Period):
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(i) Accrued Obligations. All Accrued Obligations;
(ii) Prorated Annual Bonus for Year of Termination.
Executive's Pro-rata Annual Bonus reduced (but not below zero) by the
amount of any Annual Bonus paid to Executive with respect to the
Employer's fiscal year during which the Termination Date occurs;
(iii) Deferred Pensions and Pension Enhancements. Subject to
the proviso following subsection (iii)(D), the sum of:
(A) all vested amounts previously deferred by or
accrued to the benefit of Executive under any defined benefit
or defined contribution Non-Qualified Plans, together with any
vested accrued earnings thereon, to the extent that such
amounts and earnings have not been previously paid, under the
terms of such Non-Qualified Plan,
(B) all unvested amounts previously deferred by or
accrued to the benefit of Executive under any defined benefit
or defined contribution Non-Qualified Plans, together with any
unvested accrued earnings on vested or unvested deferred
amounts, to the extent that such amounts and earnings have not
been previously paid and will not be provided under the terms
of such Non-Qualified Plan,
(C) an amount equal to the sum of the value of the
unvested portion of Executive's accounts or accrued benefits
under any defined contribution plan qualified under Section
401(a) of the Code maintained by the Williams Parties as of
the Termination date and forfeited by Executive due to
Termination of Employment
(D) an amount equal to the positive difference, if
any, between (1) and (2), where:
(1) is the sum of the Lump-Sum Values that
would be payable to Executive under any defined
benefit Non-Qualified Plan (in which Executive was a
participant) calculated as if Executive (I) had
attained as of the Termination Date an age that is up
to three years greater than Executive's actual age,
and (II) accrued a number of years of service (or, in
the case of a cash balance-type plan, a number of
years' worth of additional allocations based on
compensation as of the Termination Date) that is up
to three years greater than the number of years of
service actually accrued by (or the number of years'
worth of additional allocations actually credited to)
Executive as of the Termination Date; provided that
(x) in the case of both I and II above, such
additional years of age and/or service and/or
allocations (if any) shall be added only if and to
the
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extent that Executive's benefit is greater with such
additional years than without such additional years,
(y) years of service and/or allocations credited
under (x) shall be taken into account for purposes of
determining the amount of such benefits, entitlement
to (but not commencement of) early retirement
benefits, and all other purposes of such defined
benefit plans, and (z) such years of service and/or
allocations credited under (x) shall be in addition
to the number of additional years of service or
allocations (if any) credited to Executive pursuant
to any other agreement between a Williams Party and
the Executive;
and
(2) is the Lump Sum Value of the aggregate
amounts paid or payable to Executive under such
defined benefit Non-Qualified Plan;
provided that if the Termination Date occurs during a Post-Merger of
Equals Period, payment of the amounts described in subsections (iii)(A)
and (iii)(D) shall be postponed and such amounts shall be paid to
Executive the later of the date payable pursuant to the terms of the
applicable plan, or after (but no more than ten (10) business days
after) the Merger of Equals Cessation Date, if any; and
(iv) Multiple of Salary and Bonus. An amount equal to three
(3.0) times the sum of (A) Base Salary plus (B) the Target Annual
Bonus, each determined as of the Termination Date; provided, however,
that any reduction in Executive's Base Salary or Target Annual Bonus
that would qualify as Good Reason shall be disregarded for this
purpose.
(b) Stock Incentive Awards. If the Termination Date occurs during any
portion of a Post-Change Period that does not also qualify as a Post-Merger of
Equals Period, on Executive's Termination Date, (i) all of Executive's Stock
Options then outstanding shall immediately become fully vested and remain
exercisable until the 18-month anniversary of the Termination Date (or such
later date as may be provided in the applicable award agreement) or, if earlier,
the option expiration date for any such Stock Option, and (ii) all of
Executive's Restricted Shares then outstanding shall immediately become fully
vested and nonforfeitable.
(c) Continuation of Welfare Benefits.
(i) During the lesser of the period during which Executive or
a qualifying beneficiary (as defined in Section 607 of the Employee
Retirement Income Security Act of 1974, as amended) has in effect an
election for post-termination continuation coverage or conversion
rights to welfare benefits under applicable law, including Section 4980
of the Code ("COBRA"), or the period ending on the 18-month anniversary
of the Termination Date ("Severance
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Period"), Executive (or, if applicable, the qualifying beneficiary)
shall be entitled to such coverage at an out-of-pocket premium cost
that does not exceed the out-of-pocket premium cost applicable to
similarly situated active employees (and their eligible dependents);
provided, however, that if Executive is eligible to retiree benefits
provided under any welfare benefit plan, program, policy, practice or
procedure of the Williams Parties, Executive shall be entitled to
receive such retiree benefits in lieu of the COBRA coverage provided by
this Section 2.1(c).
(ii) For purposes of determining eligibility for (but not the
time of commencement of) such retiree benefits, Executive shall be
considered to have attained an age that is three years greater than
Executive's actual age.
(d) Outplacement. Executive shall be reimbursed for reasonable fees and
costs for outplacement services incurred by Executive within six (6) months
after the Termination Date, promptly upon presentation of reasonable
documentation of such fees and costs, subject to a maximum of $25,000.
(e) Indemnification. Executive shall be indemnified and held harmless
by Williams and the Employer on the same terms as other peer executives and to
the greatest extent permitted under applicable law as the same now exists or may
hereafter be amended and the Employer's and Williams's by-laws as such exist on
the Agreement Date if Executive was, is, or is threatened to be, made a party to
any pending, completed or threatened action, suit, arbitration, alternate
dispute resolution mechanism, investigation, administrative hearing or any other
proceeding whether civil, criminal, administrative or investigative, and whether
formal or informal, by reason of the fact that Executive is or was, or had
agreed to become, a director, officer, employee, agent or fiduciary of the
Employer or any other entity which Executive is or was serving at the request of
the Employer or Williams ("Proceeding"), against all expenses (including
reasonable attorneys' fees) and all claims, damages, liabilities and losses
incurred or suffered by Executive or to which Executive may become subject for
any reason. A Proceeding shall not include any proceeding to the extent it
concerns or relates to a matter described in Section 4.1 (concerning
reimbursement of certain costs and expenses). Upon receipt from Executive of (i)
a written request for an advancement of expenses, which Executive reasonably
believes will be subject to indemnification hereunder and (ii) a written
undertaking by Executive to repay any such amounts if it shall ultimately be
determined that Executive is not entitled to indemnification under this
Agreement or otherwise, the Employer shall advance such expenses to Executive or
pay such expenses for Executive, all in advance of the final disposition of any
such matter.
(f) Directors' and Officers' Liability Insurance. For a period of six
years after the Termination Date (or for any known longer applicable statute of
limitations period), the Executive shall be entitled to coverage under a
directors' and officers' liability insurance policy in an amount no less than,
and on the same terms as those provided to peer executive officers and directors
of the Employer.
2.2 If by the Employer for Cause.
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(a) Termination for Cause. If Executive has a Termination of Employment
for Cause during the Post-Change Period, the Williams Parties' sole obligation
to Executive under this Article II shall be to pay Executive a lump-sum cash
amount equal to all Accrued Obligations determined as of the Termination Date.
(b) Change in Control that is not a Merger of Equals: Procedural
Requirements for Termination for Cause. For any Termination of Employment for
Cause during any part of a Post-Change Period that is not a Post-Merger of
Equals Period, the Williams Parties shall strictly observe each of the following
substantive and procedural provisions:
(i) The Board shall call a meeting for the stated purpose of
determining whether Executive's acts or omissions satisfy the
requirements of the definition of "Cause" and, if so, whether to
terminate Executive's employment for Cause.
(ii) Not less than 15 days prior to the date of such meeting,
the Board shall provide or cause to be provided Executive and each
member of the Board written notice (a "Notice of Consideration") of (A)
a detailed description of the acts or omissions alleged to constitute
Cause, (B) the date of such meeting of the Board, and (C) Executive's
rights under clauses (iii) and (iv) below.
(iii) Executive shall have the opportunity to appear before
the Board in person and, at Executive's option, with legal counsel,
and/or present to the Board a written response to the Notice of
Consideration.
(iv) Executive's employment may be terminated for Cause only
if (A) the acts or omissions specified in the Notice of Consideration
did in fact occur and such actions or omissions do constitute Cause as
defined in this Agreement, (B) the Board, by affirmative vote of at
least 66 2/3 of its members (excluding Executive's vote), makes a
specific determination to such effect and to the effect that
Executive's employment should be terminated for Cause ("Cause
Determination"), and (C) Williams thereafter provides Executive with a
Notice of Termination that specifies in specific detail the basis of
such Termination of Employment for Cause and which Notice shall be
consistent with the reasons set forth in the Notice of Consideration.
Nothing in this Section 2.2(b) shall preclude the Board, by majority
vote, from suspending Executive from his duties, with pay, at any time.
(c) Change in Control that is not a Merger of Equals: Standard of
Review. In the event that the existence of Cause shall become an issue in any
action or proceeding between Executive, on the one hand, and any one or more of
the Williams Parties on the other hand, the Williams Parties, as applicable,
shall, notwithstanding the Cause Determination, have the burden of establishing
that the actions or omissions specified in the Notice of Consideration did in
fact occur and do constitute Cause and that the Williams Parties have satisfied
all applicable substantive and procedural requirements of this Section.
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(d) Merger of Equals Procedures and Standards. If the Notice of
Consideration is given during any portion of a Post-Change Period that also
qualifies as a Post-Merger of Equals Period, Sections 2.2(b) and (c) shall apply
as modified below:
(i) Executive shall have the opportunity to present to the
Board a written response to the Notice of Consideration, but shall not
have the right to appear in person or by counsel before the Board; and
(ii) The Cause Determination shall require the affirmative
vote of a simple majority of the members of the Board.
(iii) In the event that the existence of Cause shall become an
issue in any action or proceeding between Executive, on the one hand,
and any one or more of the Williams Parties, on the other hand, the
Cause Determination shall be final and binding on all parties.
2.3 If by a Participant Other Than for Good Reason. If Executive has a
Termination of Employment initiated by the Executive during the Post-Change
Period other than for Good Reason, Disability or death, the sole obligation of
the Williams Parties to Executive under this Article II shall be to pay
Executive a lump-sum cash amount equal to all Accrued Obligations determined as
of the Termination Date.
2.4 If by Death or Disability. If Executive dies during the Post-Change
Period or if Executive has a Termination of Employment during the Post-Change
Period by reason of Executive's Disability, the Williams Parties' sole
obligation to Executive under this Article II shall be to pay Executive a
lump-sum cash amount equal to all Accrued Obligations determined as of the
Termination Date.
2.5 Waiver and Release. Notwithstanding anything herein to the
contrary, no Williams Party shall have any obligation to Executive under
Articles II and/or III unless and until Executive executes a release and waiver
of Williams, the Employer and Affiliates, in substantially the same form as
attached hereto as Exhibit A, or as otherwise mutually acceptable.
2.6 Breach of Covenants. If a court determines that Executive has
breached any non-competition, non-solicitation, non-disparagement, confidential
information or intellectual property covenant entered into at any time between
Executive (on the one hand) and Williams, the Employer, or any Affiliate (on the
other hand), including the Restrictive Covenants in Article VI, (a) no Williams
Party shall have any obligation to pay or provide any severance or benefits
under Articles II and/or III, (b) all of Executive's unexercised Stock Options
shall terminate as of the date of the breach, (c) all of Executive's Restricted
Stock shall be forfeited as of the date of the breach, (d) Executive shall
reimburse a Williams Party for any amount already paid under Articles II and/or
III, and (e) Executive shall repay to the Company an amount equal to the
aggregate "spread" (as defined below) on all Stock Options exercised in the one
year period prior to the first date on which Executive breached any such
covenant ("Breach Date"). For purposes of this Section 2.6, "spread" in respect
of any Stock Option shall mean the product of the number of shares as to which
such Stock Option has been exercised during the one year period prior to the
Breach Date multiplied by the difference between the closing price of the common
stock on
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the exercise date (or if the common stock did not trade on the New York Stock
Exchange on the exercise date, the most recent date on which the common stock
did so trade) and the exercise price of the Stock Options.
ARTICLE III.
CERTAIN ADDITIONAL PAYMENTS BY WILLIAMS
3.1 Gross-Up Payment. If at any time or from time to time, it shall be
determined by the Employer's independent auditors that any payment or other
benefit to Executive pursuant to Article II of this Agreement or otherwise
("Potential Parachute Payment") is or will become subject to the excise tax
imposed by Section 4999 of the Code or any similar tax payable under any United
States federal, state, local, foreign or other law ("Excise Taxes"), then the
Employer shall, pursuant to Section 3.2, pay or cause to be paid a tax gross-up
payment ("Gross-Up Payment") with respect to all such Excise Taxes and other
Taxes on the Gross-Up Payment.
3.2 Gross-Up Payment. The Gross-Up Payment shall be an amount equal to
the product of
(a) The amount of the Excise Taxes,
multiplied by
(b) A fraction (the "Gross-Up Multiple"), the numerator of which is one
(1.0), and the denominator of which is one (1.0) minus the lesser of (i) the
sum, expressed as a decimal fraction, of the effective marginal rates of any
Taxes and any Excise Taxes applicable to the Gross-Up Payment or (ii) .80, it
being intended that the Gross-Up Multiple shall in no event exceed five (5.0).
If different rates of tax are applicable to various portions of a Gross-Up
Payment, the weighted average of such rates shall be used.
The Gross-Up Payment is intended to compensate Executive for all such Excise
Taxes and any other Taxes payable by Executive with respect to the Gross-Up
Payment. The Employer shall pay or cause to be paid the Gross-Up Payment to
Executive within thirty (30) days of the calculation of such amount, but in no
event after Executive makes payment to the IRS of such Excise Taxes.
3.3 Limitation on Gross-Up Payments. To the extent possible, any
payments or other benefits to Executive pursuant to Article II of the Agreement
shall be allocated as consideration for restrictive covenants applicable to
Executive.
3.4 Additional Gross-up Amounts. If, for any reason, the Employer's
independent auditors later determine that the amount of Excise Taxes payable by
Executive is greater than the amount initially determined pursuant to Section
3.2, then the Employer shall, subject to Section 3.3 and 3.5, pay Executive,
within thirty (30) days of such determination, or pay to the IRS as required by
applicable law, an amount (which shall also be deemed a Gross-Up Payment) equal
to the product of:
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(a) the sum of (i) such additional Excise Taxes and (ii) any interest,
penalties, expenses or other costs incurred by Executive as a result of having
taken a position in accordance with a determination made pursuant to Sections
3.2 or 3.5,
multiplied by
(b) the Gross-Up Multiple.
3.5 Amount Increased or Contested.
(a) Executive shall notify all Williams Parties in writing (a
"Participant's Notice") of any claim by the IRS or other taxing authority (an
"IRS Claim") that, if successful, would require the payment by Executive of
Excise Taxes in respect of Potential Parachute Payments in an amount in excess
of the amount of such Excise Taxes determined in accordance with Section 3.2.
Executive's Notice shall include the nature and amount of such IRS Claim, the
date on which such IRS Claim is due to be paid (the "IRS Claim Deadline"), and a
copy of all notices and other documents or correspondence received by Executive
in respect of such IRS Claim. Executive shall give Executive's Notice as soon as
practicable, but no later than the earlier of (i) 10 days after Executive first
obtains actual knowledge of such IRS Claim or (ii) five days before the IRS
Claim Deadline; provided, however, that any failure to give Executive's Notice
shall affect the Williams Parties' obligations under this Article only to the
extent that a Williams Party is actually prejudiced by such failure. If at least
one business day before the IRS Claim Deadline the Employer shall:
(i) deliver to Executive a written certificate from the
Employer's independent auditors ("Company Certificate") to the effect
that, notwithstanding the IRS Claim, the amount of Excise Taxes,
interest or penalties payable by Executive is either zero or an amount
less than the amount specified in the IRS Claim,
(ii) pay to Executive, or to the IRS as required by applicable
law, an amount (which shall also be deemed a Gross-Up Payment) equal to
difference between the product of (A) amount of Excise Taxes, interest
and penalties specified in the Company Certificate, if any, multiplied
by (B) the Gross-Up Multiple, less the portion of such product, if any,
previously paid to Executive by the Employer, and
(iii) direct Executive pursuant to Section 3.5(d) to contest
the balance of the IRS Claim,
then Executive shall pay only the amount, if any, of Excise Taxes, interest and
penalties specified in the Company Certificate. In no event shall Executive pay
an IRS Claim earlier than 30 business days after having given Executive's Notice
(or, if sooner, the IRS Claim Deadline).
(b) At any time after the payment by Executive of any amount of Excise
Taxes, other Taxes or related interest or penalties in respect of Potential
Parachute Payments (including any such amount equal to or less than the amount
of such Excise Taxes specified in any
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Company Certificate, or IRS Claim), any Williams Party may in its discretion
require Executive to pursue a claim for a refund (a "Refund Claim") of all or
any portion of such Excise Taxes, other Taxes, interest or penalties as may be
specified by the Williams Party in a written notice to Executive.
(c) If a Williams Party notifies Executive in writing that a Williams
Party desires Executive to contest an IRS Claim or to pursue a Refund Claim,
Executive shall:
(i) give the Williams Party all information that it reasonably
requests in writing from time to time relating to such IRS Claim or
Refund Claim, as applicable,
(ii) take such action in connection with such IRS Claim or
Refund Claim (as applicable) as the Williams Party reasonably requests
in writing from time to time, including accepting legal representation
with respect thereto by an attorney selected by the Williams Party,
subject to the approval of Executive (which approval shall not be
unreasonably withheld or delayed),
(iii) cooperate with the Williams Party in good faith to
contest such IRS Claim or pursue such Refund Claim, as applicable,
(iv) permit the Williams Party to participate in any
proceedings relating to such IRS Claim or Refund Claim, as applicable,
and
(v) contest such IRS Claim or prosecute Refund Claim (as
applicable) to a determination before any administrative tribunal, in a
court of initial jurisdiction and in one or more appellate courts, as
the Williams Party may from time to time determine in its discretion.
The Williams Party shall control all proceedings in connection with
such IRS Claim or Refund Claim (as applicable) and in its discretion
may cause Executive to pursue or forego any and all administrative
appeals, proceedings, hearings and conferences with the Internal
Revenue Service or other taxing authority in respect of such IRS Claim
or Refund Claim (as applicable); provided that (A) any extension of the
statute of limitations relating to payment of taxes for the taxable
year of Executive relating to the IRS Claim is limited solely to such
IRS Claim, (B) the Williams Party's control of the IRS Claim or Refund
Claim (as applicable) shall be limited to issues with respect to which
a Gross-Up Payment would be payable, and (C) Executive shall be
entitled to settle or contest, as the case may be, any other issue
raised by the Internal Revenue Service or other taxing authority.
(d) Any Williams Party may at any time in its discretion direct
Executive to (i) contest the IRS Claim in any lawful manner or (ii) pay the
amount specified in an IRS Claim and pursue a Refund Claim; provided, however,
that if a Williams Party directs Executive to pay an IRS Claim and pursue a
Refund Claim, the Williams Party shall advance the amount of such payment to
Executive on an interest-free basis and shall indemnify Executive, on an
after-tax basis, for any Excise Tax or income tax, including related interest or
penalties, imposed with respect to such advance.
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(e) The Williams Party shall pay directly all legal, accounting and
other costs and expenses (including additional interest and penalties) incurred
by the Williams Party or Executive in connection with any IRS Claim or Refund
Claim, as applicable, and shall indemnify Executive, on an after-tax basis, for
any Excise Tax or income tax, including related interest and penalties, imposed
as a result of such payment of costs and expenses.
3.6 Refunds. If, after the receipt by Executive or the IRS of any
payment or advance of Excise Taxes or other Taxes by any Williams Party,
Executive receives any refund with respect to such Excise Taxes, Executive shall
(subject to the Employer complying with any applicable requirements of Section
3.5) promptly pay the Williams Party which paid the Gross-Up Payment the amount
of such refund (together with any interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by Executive of an amount advanced by
any Williams Party pursuant to Section 3.5 or receipt by the IRS of an amount
paid by a Williams Party on behalf of Executive pursuant to Section 3.5, a
determination is made that Executive shall not be entitled to any refund with
respect to such claim and a Williams Party does not notify Executive in writing
of its intent to contest such determination within 30 days after the Williams
Parties receive written notice of such determination, then such advance shall be
forgiven and shall not be required to be repaid and the amount of such advance
shall offset, to the extent thereof, the amount of Gross-Up Payment required to
be paid. Any contest of a denial of refund shall be controlled by Section
3.5(d).
ARTICLE IV.
EXPENSES AND INTEREST
4.1 Legal and Other Expenses.
(a) If Executive incurs legal fees or other expenses (including expert
witness and accounting fees) in an effort to determine, secure, preserve,
establish entitlement to, or obtain benefits under this Agreement (collectively,
"Legal and Other Expenses"), Executive shall, regardless of the outcome of such
effort, be entitled to payment of or reimbursement for such Legal and Other
Expenses in accordance with Section 4.1(b).
(b) All Legal and Other Expenses shall be paid or reimbursed on a
monthly basis within 10 days after presentation of Executive's written request
for reimbursement accompanied by evidence that such Legal and Other Expenses
were incurred.
(c) If Executive does not prevail (after exhaustion of all available
judicial remedies) in respect of a claim by Executive or by one or more of the
Williams Parties, hereunder, and such parties establish before a court of
competent jurisdiction that Executive had no reasonable basis for his claim
hereunder, or for his response to such parties' claim hereunder, or acted in bad
faith, no further payment of or reimbursement for Legal and Other Expenses shall
be due to Executive in respect of such claim and Executive shall refund any
amounts previously paid or reimbursed hereunder with respect to such claim.
4.2 Interest. If an amount due is not paid to Executive under this
Agreement within five business days after such amount first became due and
owing, interest shall accrue on such
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amount from the date it became due and owing until the date of payment at a
annual rate equal to 200 basis points above the base commercial lending rate
published in The Wall Street Journal in effect from time to time during the
period of such nonpayment.
ARTICLE V.
NO SET-OFF OR MITIGATION
5.1 No Set-off by Williams. Executive's right to receive when due the
payments and other benefits provided for under this Agreement is absolute,
unconditional and subject to no setoff, counterclaim, recoupment, or other
claim, right or action that any Williams Party may have against Executive or
others, except as expressly provided in this Section. Notwithstanding the prior
sentence, any Williams Party shall have the right to deduct any amounts
outstanding on any loans or other extensions of credit to Executive from a
Williams Party from Executive's payments and other benefits (if any) provided
for under this Agreement. Time is of the essence in the performance by the
Williams Parties of their respective obligations under this Agreement.
5.2 No Mitigation. Executive shall not have any duty to mitigate the
amounts payable by any Williams Party under this Agreement by seeking new
employment or self-employment following termination. Except as specifically
otherwise provided in this Agreement, all amounts payable pursuant to this
Agreement shall be paid without reduction regardless of any amounts of salary,
compensation or other amounts which may be paid or payable to Executive as the
result of Executive's employment by another employer or self-employment.
ARTICLE VI.
RESTRICTIVE COVENANTS
6.1 Confidential Information. The Executive acknowledges that in the
course of performing services for Williams and its Affiliates, Executive may
create (alone or with others), learn of, have access to and receive Confidential
Information. The Executive recognizes that all such Confidential Information is
the sole and exclusive property of Williams and its Affiliates or of third
parties which Williams or Affiliate is obligated to keep confidential, that it
is Williams' policy to keep all such Confidential Information confidential, and
that disclosure of Confidential Information would cause damage to Williams and
its Affiliates. The Executive agrees that, except as required by the duties of
Executive's employment with Williams or any of its Affiliates and except in
connection with enforcing the Executive's rights under this Agreement or if
compelled by a court or governmental agency, in each case provided that prior
written notice is given to Williams, Executive will not, without the written
consent of Williams, willfully disseminate or otherwise disclose, directly or
indirectly, any Confidential Information obtained during his employment with the
Williams or its Affiliates, and will take all necessary precautions to prevent
disclosure, to any unauthorized individual or entity inside or outside Williams,
and will not use the Confidential Information or permit its use for the benefit
of Executive or any other Person other than Williams or its Affiliates. These
obligations shall continue during and after the termination of Executive's
employment for any reason and for so long as the Confidential Information
remains Confidential Information.
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6.2 Non-Competition. During the period beginning on the Agreement Date
and ending on the first anniversary of the Termination Date, regardless of the
reason for Executive's Termination of Employment, Executive agrees that without
the written consent of Williams Executive shall not at any time, directly or
indirectly, in any capacity:
(a) engage or participate in, become employed by, serve as a director
of, or render advisory or consulting or other services in connection with, any
Competitive Business; provided, however, that after the Executive's Termination
of Employment, this Section 6.2 shall not preclude Executive from (i) being an
employee of, or consultant to, any business unit of a Competitive Business if
(A) such business unit does not qualify as a Competitive Business in its own
right and (B) Executive does not have any direct or indirect involvement in, or
responsibility for, any operations of such Competitive Business that cause it to
qualify as a Competitive Business, or (ii) with the approval of Williams, being
a consultant to, an advisor to, a director of, or an employee of a Competitive
Business; or
(b) make or retain any financial investment, whether in the form of
equity or debt, or own any interest, in any Competitive Business. Nothing in
this subsection (b) shall, however, restrict Executive from making an investment
in any Competitive Business if such investment does not (i) represent more than
1% of the aggregate market value of the outstanding capital stock or debt (as
applicable) of such Competitive Business, (ii) give Executive any right or
ability, directly or indirectly, to control or influence the policy decisions or
management of such Competitive Business, or (iii) create a conflict of interest
between Executive's duties to Williams and its Affiliates or under this
Agreement and his interest in such investment.
6.3 Non-Solicitation. During the period beginning on the Agreement Date
and ending on the first anniversary of the Termination Date, regardless of the
reason for Executive's Termination of Employment, Executive shall not, directly
or indirectly:
(a) other than in connection with the good-faith performance of his
duties as an officer of Williams or its Affiliates, cause or attempt to cause
any employee or agent of Williams or an Affiliate to terminate his or her
relationship with Williams or an Affiliate;
(b) employ, engage as a consultant or adviser, or solicit the
employment or engagement as a consultant or adviser, of any employee or agent of
Williams or an Affiliate (other than by Williams or its Affiliates), or cause or
attempt to cause any Person to do any of the foregoing;
(c) establish (or take preliminary steps to establish) a business with,
or cause or attempt to cause others to establish (or take preliminary steps to
establish) a business with, any employee or agent of Williams or an Affiliate,
if such business is or will be a Competitive Business; or
(d) interfere with the relationship of Williams or an Affiliate with,
or endeavor to entice away from Williams or an Affiliate, any Person who or
which at any time during the period commencing one year prior to the Termination
Date was or is, to the Executive's knowledge, a material customer or material
supplier of, or maintained a material business relationship with, Williams or an
Affiliate.
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6.4 Intellectual Property.
(a) During the period of Executive's employment with Williams and any
Affiliate, and thereafter upon Williams' request, regardless of the reason for
Executive's Termination of Employment, Executive shall disclose immediately to
Williams all Work Product that: (i) relates to the business of Williams or any
Affiliate or any customer or supplier to Williams or an Affiliate or any of the
products or services being developed, manufactured, sold or otherwise provided
by Williams or an Affiliate or that may be used in relation therewith; or (ii)
results from tasks or projects assigned to Executive by Williams or an
Affiliate; or (iii) results from the use of the premises or personal property
(whether tangible or intangible) owned, leased or contracted for by Williams or
an Affiliate. Executive agrees that any Work Product shall be the property of
Williams and, if subject to copyright, shall be considered a "work made for
hire" within the meaning of the Copyright Act of 1976, as amended. If and to the
extent that any such Work Product is not a "work made for hire" within the
meaning of the Copyright Act of 1976, as amended, Executive hereby assigns to
Williams all right, title and interest in and to the Work Product, and all
copies thereof, and the copyright, patent, trademark, trade secret and all
proprietary rights in the Work Product, without further consideration, free from
any claim, lien for balance due, or rights of retention thereto on the part of
Executive.
(b) Williams hereby notifies Executive that the preceding Section
6.4(a) does not apply to any inventions for which no equipment, supplies,
facility, or trade secret information of Williams or an Affiliate was used and
which was developed entirely on the Executive's own time, unless: (i) the
invention relates (a) to the business of Williams or an Affiliate, or (b) to the
actual or demonstrably anticipated research or development of Williams or any
Affiliate, or (ii) the invention results from any work performed by the
Executive for Williams or any Affiliate.
(c) Executive agrees that upon disclosure of Work Product to Williams,
Executive will, during employment and at any time thereafter, at the request and
cost of Williams, execute all such documents and perform all such acts as
Williams or an Affiliate (or their respective duly authorized agents) may
reasonably require: (i) to apply for, obtain and vest in the name of Williams
alone (unless Williams otherwise directs) letters patent, copyrights or other
analogous protection in any country throughout the world, and when so obtained
or vested to renew and restore the same; and (ii) to prosecute or defend any
opposition proceedings in respect of such applications and any opposition
proceedings or petitions or applications for revocation of such letters patent,
copyright or other analogous protection, or otherwise in respect of the Work
Product.
(d) In the event that Williams is unable, after reasonable effort, to
secure Executive's execution of such documents as provided in Section 6.4(c),
whether because of Executive's physical or mental incapacity or for any other
reason whatsoever, Executive hereby irrevocably designates and appoints Williams
and its duly authorized officers and agents as his agent and attorney-in-fact,
to act for and on his behalf to execute and file any such application or
applications and to do all other lawfully permitted acts to further the
prosecution, issuance and protection of letters patent, copyright and other
intellectual property protection with the same legal force and effect as if
personally executed by Executive.
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6.5 Non-Disparagement.
(a) Executive agrees not to make, or cause to be made, any statement,
observation or opinion, or communicate any information (whether oral or written,
directly or indirectly) that (i) accuses or implies that Williams and/or any of
its Affiliates, together with their respective present or former officers,
directors, partners, stockholders, employees and agents, and each of their
predecessors, successors and assigns, engaged in any wrongful, unlawful or
improper conduct, whether relating to Executive's employment (or the termination
thereof), the business or operations of Williams, or otherwise; or (ii)
disparages, impugns or in any way reflects adversely upon the business or
reputation of Williams and/or any of its Affiliates, together with their
respective present or former officers, directors, partners, stockholders,
employees and agents, and each of their predecessors, successors and assigns.
(b) Williams agrees not to authorize any statement, observation or
opinion, or communicate any information (whether oral or written, direct or
indirect) that (i) accuses or implies that Executive engaged in any wrongful,
unlawful or improper conduct relating to Executive's employment or termination
thereof with Williams, or otherwise; or (ii) disparages, impugns or in any way
reflects adversely upon the reputation of Executive.
(c) Nothing herein shall be deemed to preclude Executive or Williams
from providing truthful testimony or information pursuant to subpoena, court or
other similar legal process.
6.6 Reasonableness of Restrictive Covenants.
(a) Executive acknowledges that the covenants contained in this
Agreement are reasonable in the scope of the activities restricted, the
geographic area covered by the restrictions, and the duration of the
restrictions, and that such covenants are reasonably necessary to protect
Williams' legitimate interests in its Confidential Information, its proprietary
work, and in its relationships with its employees, customers and suppliers.
(b) Williams has, and the Executive has had an opportunity to, consult
with their respective legal counsel and to be advised concerning the
reasonableness and propriety of such covenants. Executive acknowledges that his
observance of the covenants contained herein will not deprive Executive of the
ability to earn a livelihood or to support his or her dependents.
(c) Executive understands he is bound by the terms of this Article VI,
whether or not he receives severance payments under the Agreement or otherwise.
6.7 Right to Injunction: Survival of Undertakings.
(a) In recognition of the confidential nature of the Confidential
Information, and in recognition of the necessity of the limited restrictions
imposed by this Agreement, Executive and Williams agree that it would be
impossible to measure solely in money the damages which Williams would suffer if
Executive were to breach any of his obligations hereunder. Executive
acknowledges that any breach of any provision of this Agreement would
irreparably injure Williams. Accordingly, Executive agrees that if he breaches
any of the provisions of this
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Agreement, Williams shall be entitled, in addition to any other remedies to
which Williams may be entitled under this Agreement or otherwise, to an
injunction to be issued by a court of competent jurisdiction, to restrain any
breach, or threatened breach, of any provision of this Agreement, and Executive
hereby waives any right to assert any claim or defense that Williams has an
adequate remedy at law for any such breach.
(b) If a court determines that any covenant included in this Article VI
is unenforceable in whole or in part because of such covenant's duration or
geographical or other scope, such court shall have the power to modify the
duration or scope of such provision, as the case may be, so as to cause such
covenant as so modified to be enforceable.
(c) All of the provisions of this Agreement shall survive any
Termination of Employment of the Executive, without regard to the reasons for
such termination. Notwithstanding Section 2.6, in addition to any other rights
it may have, neither Williams nor any Affiliate shall have any obligation to pay
or provide severance or other benefits (except as may be required under the
Employee Retirement Income Security Act of 1974, as amended) after the
Termination Date if the Executive has breached any of Executive's obligations
under this Agreement.
ARTICLE VII.
NON-EXCLUSIVITY OF RIGHTS
7.1 Waiver of Certain Other Rights. To the extent that Executive shall
have received severance payments or other severance benefits under any other
plan, program, policy, practice or procedure or agreement of any Williams Party
prior to receiving severance payments or other severance benefits pursuant to
Article II, the severance payments or other severance benefits under such other
plan, program, policy, practice or procedure or agreement shall reduce (but not
below zero) the corresponding severance payments or other benefits to which
Executive shall be entitled under Article II. To the extent that Executive
accepts payments made pursuant to Article II, he shall be deemed to have waived
his right to receive a corresponding amount of future severance payments or
other severance benefits under any other plan, program, policy, practice or
procedure or agreement of any Williams Party. To the extent that Executive
accepts payments with respect to a Non-Qualified Plan under Section 2.1,
Executive shall be deemed to have waived his right to receive duplicate payments
or benefits under any Non-Qualified Plan of any Williams Party that have been
accrued as of the Termination Date.
7.2 Other Rights. Except as expressly provided in Section 7.1 and as
provided in the Recitals to this Agreement, this Agreement shall not prevent or
limit Executive's continuing or future participation in any benefit, bonus,
incentive or other plan, program, policy, practice or procedure provided by a
Williams Party and for which Executive may qualify, nor shall this Agreement
limit or otherwise affect such rights as Executive may have under any other
agreements with a Williams Party. Amounts that are vested benefits or that
Executive is otherwise entitled to receive under any plan, program, policy,
practice or procedure and any other payment or benefit required by law at or
after the Termination Date shall be payable in accordance with such plan,
program, policy, practice or procedure or applicable law except as expressly
modified by this Agreement.
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7.3 No Right to Continued Employment. Nothing in this Agreement shall
guarantee the right of Executive to continue in employment, and Williams and the
Employer retain the right to terminate the Executive's employment at any time
for any reason or for no reason.
ARTICLE VIII.
CLAIMS PROCEDURES
8.1 Filing a Claim.
(a) Each individual eligible for benefits under this Agreement
("Claimant") may submit his application for benefits ("Claim") to
Williams (or to such other person as may be designated by Williams) in
writing in such form as is provided or approved by Williams. A Claimant
shall have no right to seek review of a denial or benefits, or to bring
any action in any court to enforce a Claim, prior to his filing a Claim
and exhausting his rights to review under Sections 8.1 and 8.2.
(b) When a Claim has been filed properly, it shall be evaluated and the
Claimant shall be notified of the approval or the denial of the Claim
within 30 days after the receipt of such Claim. A Claimant shall be
given a written notice in which the Claimant shall be advised as to
whether the Claim is granted or denied, in whole or in part. If a Claim
is denied, in whole or in part, the notice shall contain (i) the
specific reasons for the denial, (ii) references to pertinent
provisions of this Agreement on which the denial is based, (iii) a
description of any additional material or information necessary to
perfect the Claim and an explanation of why such material or
information is necessary, and (iv) the Claimant's right to seek review
of the denial.
8.2 Review of Claim Denial. If a Claim is denied, in whole or in part,
or if a Claim is neither approved nor denied within the 30-day period specified
Section 8.1(b), the Claimant shall have the right at any time to (a) request
that Williams (or such other person as shall be designated in writing by
Williams) review the denial or the failure to approve or deny the Claim, (b)
review pertinent documents, and (c) submit issues and comments in writing.
Within 30 days after such a request is received, Williams shall complete its
review and give the Claimant written notice of its decision. Williams shall
include in its notice to Claimant the specific reasons for its decision and
references to provisions of this Agreement on which its decision is based.
ARTICLE IX.
MISCELLANEOUS
9.1 No Assignability. This Agreement is personal to Executive and
without the prior written consent of Williams shall not be assignable by
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by Executive's legal
representatives.
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9.2 Successors. This Agreement shall inure to the benefit of and be
binding upon Williams and its successors and assigns. Williams will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business or assets of Williams (or
the Employer during any Post-Change Period other than a Post-Merger of Equals
Period) to assume expressly and agree to perform this Agreement in the same
manner and to the same extent that Williams (or, if applicable, the Employer)
would be required to perform it if no such succession had taken place. Any
successor to the business or assets of Williams (or any Employer) which assumes
or agrees to perform this Agreement by operation of law, contract, or otherwise
shall be jointly and severally liable with Williams (or the Employer) under this
Agreement as if such successor were Williams (or the Employer). If Executive's
employment is transferred from Williams to a Subsidiary, or from a Subsidiary to
Williams or another Subsidiary, the rights and obligations of the Employer
(determined prior to such transfer) shall automatically become the rights and
obligations of the Employer (determined immediately following such transfer),
without requiring the consent of Executive.
9.3 Payments to Beneficiary. If Executive dies before receiving amounts
to which Executive is entitled under this Agreement, such amounts shall be paid
in a lump sum to one or more beneficiaries designated in writing by Executive
(each, a "Beneficiary"). If none is so designated, the Executive's estate shall
be his or her Beneficiary.
9.4 Non-Alienation of Benefits. Benefits payable under this Agreement
shall not be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, charge, garnishment, execution or levy of any
kind, either voluntary or involuntary, before actually being received by
Executive, and any such attempt to dispose of any right to benefits payable
under this Agreement shall be void.
9.5 Severability. If any one or more Articles, Sections or other
portions of this Agreement are declared by any court or governmental authority
to be unlawful or invalid, such unlawfulness or invalidity shall not serve to
invalidate any Article, Section or other portion not so declared to be unlawful
or invalid. Any Article, Section or other portion so declared to be unlawful or
invalid shall be construed so as to effectuate the terms of such Article,
Section or other portion to the fullest extent possible while remaining lawful
and valid.
9.6 Amendments. This Agreement shall not be amended or modified except
by written instrument executed by Williams and Executive.
9.7 Notices. All notices and other communications under this Agreement
shall be in writing and delivered by hand, by nationally-recognized delivery
service that promises overnight delivery, or by first-class registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to Executive, to Executive at his most recent home
address on file with Williams.
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If to Williams or the Employer:
The Williams Companies, Inc.
One Williams Center
Tulsa, Oklahoma 74172
Attention: General Counsel
or to such other address as either party shall have furnished to the other in
writing. Notice and communications shall be effective when actually received by
the addressee.
9.8 Joint and Several Liability. In the event that the Employer incurs
any obligation to Executive pursuant to this Agreement, such Employer, Williams
and each Subsidiary, if any, of which such Employer is a subsidiary shall be
jointly and severally liable with such Employer for such obligation.
9.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together constitute one and the same instrument.
9.10 Governing Law. This Agreement shall be interpreted and construed
in accordance with the laws of the State of Oklahoma, without regard to its
choice of law principles, except to the extent preempted by federal law.
9.11 Captions. The captions of this Agreement are not a part of the
provisions hereof and shall have no force or effect.
9.12 Number and Gender. Wherever appropriate, the singular shall
include the plural, the plural shall include the singular, and the masculine
shall include the feminine.
9.13 Tax Withholding. Williams may withhold from any amounts payable
under this Agreement or otherwise payable to Executive any Taxes Williams
determines to be required under applicable law or regulation and may report all
such amounts payable to such authority as is required by any applicable law or
regulation.
9.14 No Rights Prior to Change Date. Notwithstanding any provision of
this Agreement to the contrary, this Agreement shall not entitle Executive to
any compensation, severance or other payments or benefits of any kind prior to a
Change Date.
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9.15 Entire Agreement. This Agreement contains the entire understanding
of Williams and Executive with respect to its subject matter.
IN WITNESS WHEREOF, Executive and The Williams Companies, Inc. have
executed this Change in Control Severance Agreement ________________, 2002.
EXECUTIVE
-----------------------------------------
THE WILLIAMS COMPANIES, INC.
By:
-------------------------------------
Title:
----------------------------------
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EXHIBIT A
THE WILLIAMS COMPANIES, INC. CHANGE IN CONTROL SEVERANCE AGREEMENT
WAIVER AND RELEASE
[ATTACH Waiver and Release]
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