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EXHIBIT 10aaa
FORM OF
BELLSOUTH CORPORATION STOCK AND INCENTIVE COMPENSATION PLAN
2006 PERFORMANCE SHARES AWARD
TERMS AND CONDITIONS
(Internal performance metrics)
BellSouth Corporation, a Georgia corporation ("BellSouth"),
acting pursuant to action of its Board of Directors and in
accordance with the
BellSouth Corporation Stock and Incentive Compensation Plan (the
"Plan"), hereby
grants to NAME ("Employee") Performance Shares under the terms set
forth in this
Performance Shares Award Agreement ("Agreement"), effective as of
3/1/2006:
1. Award Grant. BellSouth grants to Employee Performance Shares
effective as of the date above (the "Award"). The Award is subject
to the terms
and conditions of this Agreement, and to the further terms and
conditions
applicable to Performance Shares as set forth in the Plan.
2. Performance Cycle. The Performance Cycle with respect to the
Award
shall be the three consecutive calendar year period commencing
January 1, 2006
and ending December 31, 2008.
3. Performance Pool. The Performance Pool is equal to the greater
of:
(A) nine-tenths of one percent (0.9%) of BellSouth's average
Operating Cash
Flow, or (B) one and one-half percent (1.5%) of BellSouth's average
Net Income,
in each case, for fiscal years 2006, 2007 and 2008.
4. Performance Objectives. The Award shall be payable only if
average
Operating Cash Flow or average Net Income, in each case, for fiscal
years 2006,
2007 and 2008, is positive.
5. Determination of Performance Shares Payable.
(a) Committee Certification. As soon as practicable following
the
receipt by the Compensation Committee of a report from BellSouth's
independent
auditor of BellSouth's Operating Cash Flow and Net Income for the
fiscal year
ending December 31, 2008, the Compensation Committee shall certify
in writing
whether one or more of the Performance Objectives have been
satisfied and, if
so, the amount of the Performance Pool.
(b) Determination of Performance Shares Payable. If one or more
of the Performance Objectives have been satisfied, the Compensation
Committee
shall, as soon as practicable following its certification,
calculate the number
of Performance Shares payable under this Agreement based on the
lesser of (i)
###,### and (ii) a number of Performance Shares equal to the
product of (A) the
Performance Pool divided by the End of Period Share Price (as
defined below)
times (B) ##% ; provided, however, the Compensation Committee may,
in its sole
discretion, reduce the number of Performance Shares payable to
Employee with
respect to the Award, but not below zero (the "Performance Shares
Payable").
(c) Payment. Employee shall be paid an amount in cash
determined
by multiplying the number of Performance Shares Payable by the End
of Period
Share Price. The
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amount so determined shall be paid as soon as administratively
practicable after
the certification by the Compensation Committee in accordance with
Paragraph
5(a) above, but in no event later than 2 1/2 months following the
end of the
Performance Cycle. Except as otherwise provided in this Agreement,
the "End of
Period Share Price" shall mean the average of the closing prices
quoted on the
New York Stock Exchange (NYSE) for all trading days during the
period beginning
on October 1, 2008 and ending on December 31, 2008.
(d) Dividends. If the Compensation Committee certifies that one
or more of the Performance Objectives have been satisfied pursuant
to Paragraph
5(a) above, Employee shall be paid an amount equal to the number of
Performance
Shares Payable determined pursuant to Paragraph 5(b) above, if any,
multiplied
by the amount of cash dividends that were paid on one Share
(acquired on the
first day of the Performance Cycle) during the Performance Cycle.
Any amount
payable pursuant to this Paragraph 5(d) shall be paid in cash as
soon as
administratively practicable after the certification by the
Compensation
Committee, but in no event later than 2 1/2 months following the
end of the
Performance Cycle.
6. Death, Disability or Retirement. In the event of a termination
of
Employee's employment with BellSouth or any Subsidiary, or any
employer
described in Paragraph 12 (also referred to herein as a
"Subsidiary"), during
the Performance Cycle by reason of: (i) death of Employee; (ii)
"Disability" (as
defined in the Plan); or (iii) retirement which entitles Employee
to a service
pension or service benefit under the terms of the BellSouth
Personal Retirement
Account Pension Plan or the BellSouth Supplemental Executive
Retirement Plan,
respectively, or a retirement pension under any alternative plan
maintained by
Employee's employer which BellSouth determines to be comparable to
such a
service pension or service benefit, and not for "Cause" (as defined
in the
Plan), Employee or his or her Beneficiary, as the case may be,
shall, if the
Compensation Committee certifies that one or more of the
Performance Objectives
have been satisfied with respect to the Awar
