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Exhibit 10.12
Amended and Restated Change in Control
Agreement as of
December
31, 2007
Mr.
XXXXXXXXXXXXXX:
Burlington
Northern Santa Fe Corporation (the “Corporation”)
considers it essential to the best interests of its
stockholders to foster the continuous employment of key
management personnel. In this connection, the Board
of Directors of the Corporation (the “Board”)
recognizes that, as is the case with many publicly held
corporations, the possibility of a Change in Control (as
defined in Section 2) may exist, and that such possibility,
and the uncertainty and questions which it may raise among
management, may result in the departure or distraction of
management personnel to the detriment of the Corporation and
its stockholders.
The
Board has determined that appropriate steps should be taken to
reinforce and encourage the continued attention and dedication
of members of the Corporation’s management, including
yourself, to their assigned duties without distraction in the
face of potentially disturbing circumstances arising from the
possibility of a Change in Control.
In
order to induce you to remain in the employ of the Corporation
or any entity with which the Corporation is considered to be a
single employer under Section 414 (b) or Section 414(c) of the
Internal Revenue Code of 1986, as amended from time to time
(the “Code”) (all such entities, collectively,
“Affiliates”), the Corporation agrees that you
shall receive the severance benefits set forth in this letter
agreement (the “Agreement”) in the event your
employment with the Corporation is terminated under the
circumstances described below subsequent to a Change in
Control, and that you shall be eligible for the parachute tax
gross-up and certain other benefits described in this
Agreement.
1.
TERM. The
“Agreement Term” shall begin on December 31, 2007 (the
“Effective Date” of this Agreement), and shall end on
December 31, 2008, subject to the following:
(i)
As
of January 1, 2009, and each January 1 thereafter, the Agreement
Term shall automatically be extended to the next following December
31; provided ,
however , that
no such extension shall take place if, on or before the September
30 next preceding the date on which the extension would otherwise
take place, the Corporation has given notice that it does not wish
to extend the Agreement Term; and further provided that no such
extension shall take place if the effect of the extension would be
to extend the Agreement Term beyond the December 31 coincident with
or next following the two-year anniversary of the date on which you
cease to be in a position that is at or above salary band 36
(unless, as of such December 31, you are again in a position that
is at or above salary band 36); and further provided that subject
to paragraph 1(ii) below no such extension shall take place if a
Change in Control has occurred prior to the date on which the
extension would otherwise take place. For the avoidance
of doubt, it is recited here that if a Change in Control described
in paragraph 2(i) or 2(iii) occurs, and your Date of Termination
occurs after the 24-month anniversary of the date of the Change in
Control but before consummation of the transaction approved by the
shareholders and before the Agreement Term expires by reason of
paragraph (iii) below (relating to a Board determination that
consummation will not occur), the Agreement Term shall be extended
to your Date of Termination.
(ii)
Subject
to paragraph 1(iii) next below, if a Change in Control occurs
during the Agreement Term (as it may be extended from time to
time), the Agreement Term shall be extended for a period of
twenty-four (24) months beyond the last day of the calendar month
in which the Change in Control occurs, but in no event less than
twelve (12) months beyond the date of the consummation of the
Change in Control.
(iii)
If
a Change in Control described in paragraph 2(iii) or 2(iv) occurs
during the Agreement Term (as it may be extended from time to
time), but the Board thereafter determines that it will not
consummate the transaction or regulatory approval for the
transaction is not obtained, then the Board may reduce the 24-month
extension period set forth in paragraph 1(ii) next above;
provided that
the Agreement Term may not end earlier than six (6) months after
such notice of reduction is provided by the Board or, if earlier,
the date such Agreement Term would end in the absence of action
under this paragraph 1(iii).
(iv)
In
no event, however, shall the Agreement Term extend beyond the end
of the calendar month in which your 65th birthday occurs if you are
subject to mandatory retirement at such age or to the extent
permitted by law.
2.
CHANGE
IN CONTROL. A “Change in Control” shall be
deemed to have occurred if:
(i)
Any
“person” as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) (other than the Corporation, any
trustee or other fiduciary holding securities under an employee
benefit plan of the Corporation, or any company owned, directly or
indirectly, by the stockholders of the Corporation in substantially
the same proportions as their ownership of stock of the
Corporation), is or becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Corporation representing 25% or
more of the combined voting power of the Corporation’s then
outstanding securities.
(ii)
During
any period of two consecutive years (not including any period prior
to the Effective Date), individuals who at the beginning of such
period constitute the Board, and any new director (other than a
director designated by a person who has entered into an agreement
with the Corporation to effect a transaction described in
paragraphs (i), (iii) or (iv) of this definition) whose election by
the Board or nomination for election by the Corporation’s
stockholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to
constitute at least a majority thereof.
(iii)
The
stockholders of the Corporation approve a merger or consolidation
of the Corporation with any other company other than (a) a merger
or consolidation which would result in the voting securities of the
Corporation outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than 80% of
the combined voting power of the voting securities of the
Corporation (or such surviving entity) outstanding immediately
after such merger or consolidation, or (b) a merger or
consolidation effected to implement a recapitalization of the
Corporation (or similar transaction) in which no
“person” (as hereinabove defined) acquires more than
25% of the combined voting power of the Corporation’s then
outstanding securities.
(iv)
The
stockholders of the Corporation adopt a plan of complete
liquidation of the Corporation or approve an agreement for the sale
or disposition by the Corporation of all or substantially all of
the Corporation’s assets. For purposes of this
paragraph 2(iv), the term “the sale or disposition by the
Corporation of all or substantially all of the Corporation’s
assets” shall mean a sale or other disposition transaction or
series of related transactions involving assets of the Corporation
or of any direct or indirect subsidiary of the Corporation
(including the stock of any direct or indirect subsidiary of the
Corporation) in which the value of the assets or stock being sold
or otherwise disposed of (as measured by the purchase price being
paid therefor or by another objective method in a case where there
is no readily ascertainable purchase price) constitutes more than
two-thirds of the fair market value of the Corporation (as
hereinafter defined). For purposes of the preceding
sentence, the “fair market value of the Corporation”
shall be the aggregate market value of the outstanding shares of
common stock of the Corporation (on a fully diluted basis) plus the
aggregate market value of the Corporation’s other outstanding
equity securities (excluding employee stock
options). The aggregate market value of the shares of
common stock of the Corporation (on a fully diluted basis)
outstanding on the date of the execution and delivery of a
definitive agreement with respect to the transaction or series of
related transactions (the “Transaction Date”) shall be
determined by the average closing price of the shares of common
stock of the Corporation for the ten trading days immediately
preceding the Transaction Date. The aggregate market
value of any other equity securities of the Corporation shall be
determined in a manner similar to that prescribed in the
immediately preceding sentence for determining the aggregate market
value of the shares of common stock of the
Corporation.
A
Change in Control that occurs prior to the beginning of the
Agreement Term shall be disregarded for purposes of this
Agreement.
3.
BASIS
OF EMPLOYMENT TERMINATION. If (x) your Date of
Termination (or the date of delivery of the applicable Notice of
Termination) occurs during the Agreement Term and is coincident
with or follows the occurrence of a Change in Control or (y) if you
have a disability during the Agreement Term after the occurrence of
a Change in Control, then you shall be eligible for payments and
benefits in accordance with, and to the extent provided by, Section
4, with such eligibility determined on the basis for your
termination of employment. For purposes of this
Agreement, the basis for your termination of employment shall be
determined in accordance with this Section 3.
(i)
Disability. If,
as a result of your incapacity due to physical or mental illness or
injury, you shall have been absent from the full-time performance
of your duties with the Corporation for six (6) consecutive months,
and within thirty (30) days after written Notice of Termination is
given by the Corporation, you shall not have returned to the
full-time performance of your duties, your employment may be
terminated by the Corporation for unavailability due to
“Disability.” Notwithstanding any other
provision of this Agreement, a termination of employment under this
paragraph 3(i) shall not cause you to be considered a terminated
employee within the meaning of the Corporation’s long term
disability plan and your rights thereunder shall not be affected by
this Agreement.
(ii)
Cause. Your
Date of Termination shall be deemed to have occurred for
“Cause,” if your Date of Termination occurs because of
circumstances described in paragraph 3(ii)(a) or paragraph 3(ii)(b)
next below, as determined in accordance with the procedures set
forth in paragraphs 3(ii)(A), (B) and (C) next below:
(a)
the
willful and continued failure by you to substantially perform your
duties with the Corporation (other than any such failure resulting
from your incapacity due to physical or mental illness or injury,
or any such actual or anticipated failure after the issuance of a
Notice of Termination by you for Good Reason); or
(b)
the
willful engaging by you in conduct which is demonstrably and
materially injurious to the Corporation, monetarily or
otherwise.
For
purposes of this paragraph 3(ii), no act, or failure to act,
on your part shall be deemed “willful” unless
done, or omitted to be done, by you not in good faith and
without a reasonable belief that your action or omission was
in the best interest of the Corporation. Your Date
of Termination shall not be deemed to have occurred for
“Cause” unless the procedures described in
paragraphs 3(ii)(A), (B) and (C), next below, have been
satisfied:
(A)
A
written notice of alleged Cause is delivered to you by the Board or
a member of the Board. In the case of
“Cause” described in paragraph 3(ii)(a) (relating to a
failure to perform your duties), the written notice shall consist
of specific identification of the manner in which the Board or such
Board member believes that you have not substantially performed
your duties, and shall include a demand for such
performance. In the case of “Cause”
described in paragraph 3(ii)(b) (relating to conduct injurious to
the Corporation), the written notice shall consist of specific
identification of the manner in which the Board or such Board
member believes that you have engaged in conduct which is
demonstrably and materially injurious to the
Corporation.
(B)
You
have received an opportunity to be heard by the Board or a member
of the Board, which will consist of delivery to you of reasonable
advance written notice of a Board meeting (to be delivered at or
after the time you receive the notice of alleged Cause, described
in paragraph 3(ii)(A) next above), at which you, together with your
counsel, may be heard by the Board, concerning the contents of the
notice of alleged Cause and, in the case of “Cause”
described in paragraph 3(ii)(a), the manner in which you intend to
achieve substantial performance.
(C)
You
have received a copy of your Notice of Termination, which will
include a copy of a resolution duly adopted by the affirmative vote
of not less than three-quarters (3/4) of the entire membership of
the Board at a meeting of the Board, which occurs after your
opportunity to be heard by the Board (at that meeting or a
subsequent meeting), and which finds that in the good faith opinion
of the Board you were guilty of conduct set forth in the notice of
alleged Cause and which specifies the particulars thereof in
detail. The Date of Termination set forth in the Notice
of Termination shall be not earlier than thirty (30) days after the
notice of alleged Cause has been delivered to you in accordance
with paragraph 3(ii)(A).
(iii)
Good
Reason. Subject to the procedures set forth in
paragraphs 3(iii)(A), (B) and (C) next below, you shall be entitled
to terminate your employment for Good Reason. For
purposes of this Agreement, “Good Reason” shall mean,
without your express written consent, the occurrence, after a
Change in Control, of any of the circumstances described in
paragraphs 3(iii)(a) through (h) next below. However,
“Good Reason” shall not exist if such circumstances are
fully corrected (or in the case of a relocation described in
paragraph 3(iii)(c) next below, if the request to relocate your
base of operations is withdrawn) prior to the Date of Termination
specified in the Notice of Termination given in respect
thereof.
(a)
The
assignment to you of any duties with a level of responsibility
materially inconsistent with the position in the Corporation that
you held immediately prior to the Change in Control, or a
significant adverse alteration in the status of your
responsibilities from those in effect immediately prior to such
Change in Control.
(b)
A
material reduction by the Corporation in your annual base salary as
in effect on the Effective Date, and adjusted to reflect such
increases as may be made after the Effective Date and prior to the
occurrence of a Change in Control, and also adjusted to reflect
such decreases as may be made after the Effective Date, but taking
decreases into account only to the extent that they are part of
across-the-board salary reductions similarly affecting all
management personnel of the Corporation and all management
personnel of any person in control of the Corporation.
(c)
The
relocation of your base of operations for the Corporation or any of
its Affiliates to a place that is fifty (50) miles farther from
your residence immediately prior to the Change in Control than the
distance from such residence to your former base of operations for
the Corporation or such Affiliate. The determination of
whether the distance exceeds 50 miles shall be performed in a
manner that is consistent with Internal Revenue Service rules
applicable to the determination of deductibility of moving
expenses.
(d)
The
failure by the Corporation to pay to you any material portion of
your current compensation or to pay to you any portion of an
installment of deferred compensation under any deferred
compensation program of the Corporation when such compensation is
due.
(e)
The
failure by the Corporation to continue in effect any compensation
plan in which you participate immediately prior to the Change in
Control that is material to your total compensation, including but
not limited to a material reduction in the benefits (or, in the
case of incentive- or performance-based compensation,
opportunities) provided to you under the Corporation’s
Retirement Plan, Supplemental Retirement Plan, Investment and
Retirement Plan, Supplemental Investment and Retirement Plan,
Incentive Compensation Plan, Stock Incentive Plan, or any
substitute plans adopted prior to the Change in Control, unless an
equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such plan, or the
failure by the Corporation to continue your participation therein
(or in such substitute or alternative plan) on a basis not
materially less favorable, both in terms of the amount of benefits
provided and the level of your participation relative to other
participants, as existed at the time of the Change in
Control.
(f)
The
failure by the Corporation to continue to provide you with benefits
substantially similar to those enjoyed by you under any of the
Corporation’s life insurance, medical, health and accident,
or disability plans in which you were participating at the time of
the Change in Control, the taking of any action by the Corporation
which would directly or indirectly materially reduce any of such
benefits or deprive you of any material fringe benefit enjoyed by
you at the time of the Change in Control, or the provision by the
Corporation to you of a number of paid vacation days that is
materially less than the number of vacation days to which you were
entitled on the basis of years of service with the Corporation in
accordance with the Corporation’s normal vacation policy in
effect at the time of the Change in Control.
(g)
The
failure of the Corporation to obtain an agreement from any
successor to assume and agree to perform this Agreement, as
contemplated in Section 7.
(h)
Any
purported termination of your employment that is not effected
pursuant to a Notice of Termination in material compliance with the
requirements of paragraph 3(vi) (and, if applicable, the
requirements of paragraph 3(ii)), which purported termination shall
not be effective for purposes of this Agreement.
You
shall not be deemed to have terminated employment for Good
Reason unless, within a reasonable time (not more than six (6)
months) after the initial existence of the circumstances
constituting Good Reason, you have delivered a written Notice
of Termination, which:
(A)
identifies
the circumstances, and the provisions of this paragraph 3(iii),
which form the basis for your termination for Good
Reason;
(B)
demands
correction; and
(C)
specifies
a Date of Termination which is not less than fifteen (15) days nor
more than sixty (60) days after the Notice of Termination has been
provided to the Corporation;
provided that if the Corporation is reasonably unable to
correct the circumstances described in your Notice of Termination
within the time period prior to your scheduled Date of Termination,
and responds to you in writing within seven (7) days of the receipt
of your Notice of Termination notifying you of the time reasonably
required to correct the circumstances (which may not be more than
thirty (30) days after receipt of your Notice of Termination), your
scheduled Date of Termination in your Notice of Termination will be
deemed to be postponed until the end of such correction period, and
Good Reason will not exist if the circumstances are fully corrected
(or, if applicable, the request for relocation is withdrawn) within
that correction period. Your continued employment shall
not constitute consent to, or a waiver of rights with respect to,
any circumstance constituting Good Reason hereunder, and your
failure to relocate after filing the Notice of Termination will not
adversely affect the characterization of the Corporation’s
relocation request as Good Reason under paragraph 3(iii)(c)
above.
(iv)
Discharge
Absent Cause or Disability. You shall be deemed to have
been discharged by the Corporation absent Cause or Disability if
your employment is terminated by the Corporation other than in
accordance with paragraph 3(i) (relating to Disability) or
paragraph 3(ii) (relating to Cause). Your Date of
Termination under this paragraph 3(iv) may not be earlier than
sixty (60) days after the written Notice of Termination is
delivered to you, except that the sixty (60) day notice requirement
shall not apply to the extent the Date of Termination occurs prior
to the date of a Change in Control. If your employment
is terminated in accordance with this paragraph 3(iv) and the
Notice of Termination is delivered to you within sixty (60) days
prior to the occurrence of a Change in Control, your Date of
Termination shall be deemed to be, for purposes of Section 4(iii),
the day after such Change in Control; provided
that, for purposes of the timing of any payments or benefits owed
to you under Section 4, the Date of Termination shall be the date
specified in the Notice of Termination.
(v)
Payment
in Lieu of Notice. The Corporation shall be deemed to
have complied with the requirement of this Section 3 relating to
advance Notice of Termination notwithstanding that the Corporation
may have provided you with fewer days’ notice than otherwise
required pursuant to this Section 3, and in the event of a
termination of employment by you for Good Reason, the Corporation
may waive your obligation to provide the number of days of notice
otherwise required pursuant to this Section 3 (and thereby cause
your Date of Termination to occur earlier than the Date of
Termination specified in your Notice of Termination for Good
Reason) (the days of notice otherwise required to be given by the
Corporation or you, as applicable, the “Required Notice
Days” and the number of Required Notice Days less the number
of days of notice actually provided by the Corporation or you, as
applicable, the “Waived Notice Days”); provided that
the Corporation shall pay you a cash amount equal to the base
salary that you would have earned during the Waived Notice Days had
the Corporation provided you with, or you provided the Corporation
with, as applicable, the number of Required Notice
Days. Such payment shall be made in a lump sum no later
than the fifth day following your Date of Termination.
(vi)
Notice
of Termination. “Notice of Termination”
shall mean a notice that shall indicate the specific termination
provision in this Agreement relied upon, shall set forth in
reasonable detail the facts and circumstances claimed to provide a
basis for termination of your employment under the provision so
indicated and shall specify a Date of Termination in accordance
with this Section 3.
(vii)
Date
of Termination. “Date of Termination” shall mean your
ceasing to be employed by the Corporation and the Affiliates;
provided that
the employment relationship will be deemed to have ended at the
time you and your employer reasonably anticipate that the level of
bona fide services you would perform for the Corporation and the
Affiliates after such date (whether as an employee or independent
contractor, but not as a director) would permanently decrease to no
more than 20% of the average level of bona fide services performed
over the immediately preceding 36 month period (or the full period
of service to the Corporation and the Affiliates if you have
performed services for the Corporation and the Affiliates for less
than 36 months). In the absence of an expectation that
you will perform at the above-described level, the Date of
Termination of employment will not be delayed solely by reason of
your continuing to be on the Corporation’s and the
Affiliates’ payroll after such date. The
employment relationship will be treated as continuing intact while
you are on a bona fide leave of absence (determined in accordance
with Treas. Reg. §1.409A-1(h)).
4.
COMPENSATION
UPON TERMINATION OR DURING DISABILITY. If (x) your Date
of Termination (or the date of delivery of the applicable Notice of
Termination) occurs during the Agreement Term and is coincident
with or follows the occurrence of a Change in Control or (y) if you
have a disability during the Agreement Term and after the
occurrence of a Change in Control, then you shall be entitled to
payments and benefits in accordance with, and to the extent
provided by, this Section 4.
(i)
Discharge
for Cause and Voluntary Resignation. If your employment
is terminated by the Corporation for Cause, or is terminated by you
other than for Good Reason, the Corporation shall pay you your full
base salary through the Date of Termination at the rate in effect
at the time Notice of Termination is given, with payment to be made
no later than the fifth day following your Date of Termination,
plus all other amounts to which you are entitled under any
compensation plan of the Corporation or any Affiliate at the time
such payments are due, and the Corporation shall have no further
obligations to you under this Agreement.
(ii)
Disability. During
any period that you fail to perform your full-time duties with the
Corporation as a result of incapacity due to physical or mental
illness or injury, you shall continue to receive your base salary
at the rate in effect at the commencement of any such period,
together with all compensation payable to you under any long term
disability plan or other similar plan during such period, until
your employment is terminated pursuant to paragraph
3(i). Thereafter, or in the event your employment shall
be terminated by reason of your death, your benefits shall be
determined under the Corporation’s retirement, insurance and
other compensation programs then in effect in accordance with the
terms of such program; however, your receipt of benefits under the
long term disability plan will not be affected by your termination
under this Agreement.
(iii)
Termination
for Good Reason and Discharge Absent Cause or
Disability. If your employment is terminated by you for
Good Reason, or by the Corporation absent
Cause
or Disability
(as described in paragraph 3(iv)), then you shall be entitled to
the payments and benefits described below, subject to
Section 14:
(a)
Prior
Salary and Deferrals. The Corporation shall pay to you
(1) your full base salary through your Date of Termination at the
rate in effect at the time the Notice of Termination is given, with
payment to be made no later than the fifth day following your Date
of Termination; (2) a lump sum cash payment equal to your Bonus
Rate (defined below) for the year in which your Date of Termination
occurs, subject to a pro rata reduction for the portion of the year
after your Date of Termination, with payment to be made at the time
specified in paragraph 4(iv)(a); and (3) all other amounts to which
you are entitled under any compensation plan of the Corporation, at
the time such payments are due under the terms of such
plans.
(b)
Additional
Salary and Severance. In lieu of any further salary or
bonus payments to you for periods subsequent to your Date of
Termination, and except as provided in paragraph 4(iv)(b), the
Corporation will pay to you, at the time specified in paragraph
4(iv)(a), a lump sum salary and bonus distribution, in an amount
equal to the sum of: (I) a severance payment
of (1) 2.0 times your Salary Rate plus (2) 2.0 times
your Bonus Rate plus (II) a payment in return for the imposition of
the requirements of paragraph 4(iv)(b) (relating to competition)
equal to (1) 0.5 times your Salary Rate plus (2) 0.5 times your
Bonus Rate.
For
purposes of this paragraph 4(iii)(b):
(A)
Your
“Salary Rate” shall be equal to the greatest
of: (1) your annual salary as in effect as of the Date
of Termination, inclusive of amounts that would have been included
in annual salary if such amounts had not been deferred under the
Burlington Northern Santa Fe Corporation Supplemental Investment
and Retirement Plan or foregone under any other arrangement of the
Corporation or its Affiliates providing for the elective deferral
of salary, (2) your highest consecutive twelve (12) months’
salary over the twenty-four (24) month period preceding the Date of
Termination, or (3) your annual salary as in effect immediately
prior to the Change in Control.
(B)
Your
“Bonus Rate” shall be the amount which you would have
received under the Corporation’s Incentive Compensation Plan
(or other successor annual bonus plan) for the calendar year in
which your Date of Termination occurs, if you had remained employed
by the Corporation for that entire year, and the target level of
performance established annually by the Corporation had been
achieved for the year. For the avoidance of doubt, it is
recited here that achievement of target level of performance shall
mean the achievement of a performance level whereby all of the
performance objectives for the year are at planned and budgeted
levels of performance (as provided in the bonus plan); and such
level of performance shall be greater than threshold level of
performance (which is the minimum level of performance that will
result in payment of any bonus), and shall be less than the maximum
level of performance, which is a level of performance above the
performance level planned and budgeted for the year, which would
result in maximum bonus.
(c)
Outstanding
Stock Awards. The following provisions of this paragraph
4(iii)(c) shall apply to stock awards granted under the
Corporation’s 1996 Stock Incentive Plan, 1999 Stock Incentive
Plan, or any similar successor plan:
(A)
Except
as provided in paragraph 4(iii)(d) below, the restrictions shall
lapse (to the extent that they have not previously lapsed) on any
stock option award or stock appreciation right award outstanding on
the Date of Termination, such stock options and stock appreciation
rights shall become fully exercisable beginning as of the Date of
Termination, and such exercisability shall continue until it would
otherwise terminate in accordance with the terms of the applicable
award agreement.
(B)
Except
as provided in paragraph 4(iii)(c)(C) below and paragraph 4(iii)(d)
below, the restricted period (or other vesting or similar period)
with respect to any restricted stock, restricted stock units and,
except for stock options and stock appreciation rights, all other
stock-based awards granted to you as of a date prior to the date of
the Change in Control shall lapse on your Date of Termination, and
such shares shall be distributed to you at the same time as the
cash payments described in paragraph 4(iv) are
paid. However, any change in the time or form of
distribution otherwise provided under this paragraph (B) shall be
disregarded to the extent that such change would otherwise result
in the application of penalties under Section 409A.
(C)
The
foregoing provisions of this paragraph 4(iii)(c) shall not apply to
the vesting of Performance Stock Awards, and the vesting of
Performance Stock Awards shall be governed by the applicable award
agreements for such awards, without regard to the terms of this
Agreement. For purposes of this Agreement, the term
“Performance Stock Awards” shall have the meaning set
forth in Section 9 of the 1999 Stock Incentive Plan (and shall
include any awards expressly designated as “Performance Stock
Awards” under any successor to the 1999 Stoc
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