AT&T 10-K 2009
Documents found in this filing:
SHORT TERM INCENTIVE PLAN
Plan Effective: January 1, 1984
Revisions Effective: November 18, 2005
SHORT TERM INCENTIVE PLAN
Award Year>. "Award Year" shall mean the calendar year for which performance is used to determine one's award under the Plan.
Chairman. "Chairman" shall mean the Chairman of the Board of AT&T Inc.
Eligible Employee>. "Eligible Employee" shall mean an Officer and any other individual who is participating in the Plan as of September 1, 2005. Notwithstanding the foregoing, the CEO of AT&T Inc. (CEO) may, from time to time, exclude any Officer or group of Officers from being an Eligible Employee under this Plan. Further, an employee of a company acquired by AT&T shall not be considered an Eligible Employee unless designated as eligible by the CEO.
Officer>. "Officer" shall mean an individual who is designated as an officer of AT&T or of any AT&T subsidiary for compensation purposes on AT&T’s records.
Retirement. >"Retirement" shall mean the termination of an Eligible Employee's employment with AT&T or any of its subsidiaries, for reasons other than death, on or after the earlier of the following dates: (1) the date a participant has attained age 55, and, for an individual who becomes a participant on or after January 1, 2002, has five (5) years of service, or (2) the date the Eligible Employee has attained one of the following combinations of age and service at termination of employment on or after April 1, 1997, except as otherwise indicated below:
With respect to an Eligible Employee who is granted an EMP Service Pension under and pursuant to the provisions of the AT&T Pension Benefit Plan - Nonbargained Program ("AT&TPBP") upon termination of Employment, the term "Retirement" shall include such Eligible Employee's termination of employment.
then such termination of employment shall be a Retirement for all purposes under this Plan and the Eligible Employee shall be entitled to the treatment under this Plan afforded in the case of a termination of employment which is a Retirement.
The Target Award applicable to an employee otherwise eligible for an award under the Plan for an Award Year shall be prorated over the Award Year or the employee shall be ineligible for an award, as follows:
A percentage of the Target Award for each Award Year to be distributed to the award recipient will be determined by the Committee, or Chairman, for Officers and non-Officer Eligible Employees, respectively, based upon achievement of performance levels during such Award Year of criteria established by the Committee, or the Chairman, respectively.
The criteria established by the Committee for Officers, or the Chairman with respect to non-Officer Eligible Employees, upon which the percentages of the Target Awards referred to above are determined shall give due regard, as the Committee, or the Chairman, as applicable, deems appropriate, to one or more of the following for the Award Year:
The Committee then with respect to Officers, or the Chairman with respect to non-Officer Eligible Employees, shall determine the payout of Awards in such amounts and to such of the Eligible Employees as each may determine in its sole discretion. Awards shall be paid in cash in the calendar year the awards are determined, except to the extent that an Eligible Employee has made an election to defer the receipt of such award pursuant to the AT&T Salary and Incentive Award Deferral Plan or other AT&T deferred compensation plan.
The award to be distributed to an individual may be more or less in the Committee's or the Chairman's discretion, as applicable, including no award, than the percentage of the Target Award determined for such individual; for example, the Committee or the Chairman, as applicable, may approve an award greater than the Target Award, adjusted for performance, based on individual performance.
6. Other Conditions.
8. Plan Administration.
SHORT TERM INCENTIVE PLAN
Annual financial and/or other performance objectives for Officers for an Award Year shall be approved by the Committee each year, generally in January of the Award Year. Objectives for non-Officer Eligible Employees shall be approved by the Chairman. Annual financial and/or other performance results (upon which the payment of Awards for Officers shall be based), maximum funding levels, and payout recommendations requiring Committee approval, will be submitted to and approved by the Committee after the Award Year is completed. Results for non-Officer Eligible Employees shall be approved by the Chairman.
An individual’s Target Award will be prorated over the Award Year, if applicable, according to Section 4 of the Plan.
Target Awards will be adjusted for distribution based upon achievement during the Award Year, of the financial and/or other performance criteria established by the Committee or the Chairman, as applicable. Discretionary awards may also be granted as described in Section 5, to be paid out of funds from the Discretionary Pools.
Achievement of Value Added objectives or other financial objectives (e.g., gross contributions, revenues, net income, operating contribution, etc.) will be used as financial performance criteria for all entities.
Value Added shall be a measure of earnings above a return required by investors (i.e., generally, net operating contribution less a capital charge).
Value Added or other financial measurement’s performance is determined after adjustment in accordance with the following:
In order to assure the incentive features of the Plan and to avoid distortion in the operation of the Plan, the Committee or the Chairman, as applicable, shall make adjustments in the criteria established for any Award Year, whether before or after the end of the Award Year to compensate for or reflect any extraordinary changes which may have occurred during the Award Year which alter the basis upon which performance levels were determined. Such changes include the following: accounting changes, extraordinary items, income from discontinued operations, and the impact of material events that have been publicly disclosed.
Other performance criteria may include, but are not limited to, Value Drivers, i.e., quantifiable operational and other indicators, such as revenue growth, customer or subscriber growth, operating margin, etc., that are tied to the strategy of the operating entity and are key barometers of value creation.
Formula-Driven Awards -
The Committee, or the Chairman, as applicable, shall establish financial and/or other performance objectives for AT&T and such other entities as deemed appropriate by the Committee or the Chairman, as applicable.
A percentage of the Target Award for the preceding Award Year is paid to Officers and to non-Officer Eligible Employees in each entity based on the achievement of applicable financial and/or other performance results of their entity.
Discretionary Pools -
After determination of formula-driven awards, the Committee for Officers and the Chairman for non-Officer Eligible Employees may establish Discretionary Pools to reward individuals and/or entities for exceptional performance. Maximum funding available for Discretionary Pools is the maximum funding level described in Section 4 less the formula-driven amounts distributed.
The Committee or the Chairman, as applicable, will determine funding for each pool and provide guidelines for distribution of awards. The following are examples of factors that may be considered:
The Chairman will recommend to the Committee the discretionary awards for officers reporting directly to the Chairman.