REG - AT & T Inc. - 1st Quarter Results 2017 <Origin Href="QuoteRef">T.N</Origin> - Part 7
23/05/2017 15:40
- Part 7: For the preceding part double click ID:nRSW0123Gf
reduction in the period of time over which the Participant's Cash Deferral
Account may be distributed to a Participant, any reduction in the amounts credited to the Participant's Cash Deferral
Accounts, or any reduction in the Plan Interest Rate (other than as it may fluctuate in accordance with its terms) for Cash
Deferral Accounts previously elected by the Participant. Any such consent may be in a writing, telecopy, or e-mail or in
another electronic format. An election to make Employee Contributions shall be conclusively deemed to be the consent of
the Participant to any and all amendments to the Plan prior to such election, and such consent shall be a condition to
making any election with respect to Employee Contributions.
The Plan is established in order to provide deferred compensation to a select group of management and highly compensated
employees with in the meaning of Sections 201(2) and 301(a)(3) of ERISA. To the extent legally required, the Code and
ERISA shall govern the Plan, and if any provision hereof is in violation of an applicable requirement thereof, the Company
reserves the right to retroactively amend the Plan to comply therewith to the extent permitted under the Code and ERISA.
The Company also reserves the right to make such other changes as may facilitate implementation of Section 409A of the
Code. Provided, however, that in no event shall any such amendments be made in violation of the requirements of Section
409A of the Code.
Article 8 − Miscellaneous
8.1 Tax Withholding.
Upon a distribution from a Participant's Cash Deferral Account, AT&T shall withhold sufficient amounts to satisfy the
minimum amount of Federal, state, and local taxes required by law to be withheld as a result of such distribution.
8.2 Loyalty Conditions for Officer Level Employees and Senior Managers.
Each Officer Level Employee or a Senior Manager who elects to make Employee Contributions under Section 4.1 of this Plan
shall be subject to the agreements and conditions of this section.
(a) By making an Employee Contribution election under Section 4.1 of this Plan after September 1, 2009, a
Participant acknowledges that AT&T would be unwilling to provide for such an election but for the loyalty conditions and
covenants set forth in this section, and that the conditions and covenants herein are a material inducement to AT&T's
willingness to sponsor the Plan and to offer Plan benefits for the Participants. Accordingly, as a condition to making an
Employee Contribution election under Section 4.1 of this Plan after September 1, 2009, each such electing Participant is
deemed to agree that he shall not, without obtaining the written consent of the Committee in advance, participate in
activities that constitute engaging in competition with AT&T or engaging in conduct disloyal to AT&T, as those terms are
defined in this section.
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(b) Definitions. For purposes of this section and of the Plan generally:
(i) an "Employer Business" shall mean AT&T Inc. and any of its Subsidiaries, or any business in which they or any affiliate of theirs has a substantial ownership or joint venture interest;
(ii) "engaging in competition with AT&T" shall mean, while employed by AT&T or any of its Subsidiaries, or within two (2) years after Participant's Termination of Employment, engaging by the Participant in any business or activity in all or any portion of the
same geographical market where the same or substantially similar business or activity is being carried on by an Employer Business. "Engaging in competition with AT&T" shall not include owning a non-substantial publicly traded interest as a shareholder in
a business that competes with an Employer Business. "Engaging in competition with AT&T" shall include representing or providing consulting services to, or being an employee of, any person or entity that is engaged in competition with any Employer Business
or that takes a position adverse to any Employer Business.
(iii) "engaging in conduct disloyal to AT&T" means, while employed by AT&T or any of its Subsidiaries, or within two (2) years after Participant's Termination of Employment, (i) soliciting for employment or hire, whether as an employee or as an independent
contractor, for any business in competition with an Employer Business, any person employed by AT&T or any of its Subsidiaries during the one (1) year prior to the Participant's Termination of Employment, whether or not acceptance of such position would
constitute a breach of such person's contractual obligations to AT&T or any of its Subsidiaries; (ii) soliciting, encouraging, or inducing any vendor or supplier with which Participant had business contact on behalf of any Employer Business during the two
(2) years prior to the Participant's Termination of Employment (regardless of the reason for that termination) to terminate, discontinue, renegotiate, reduce, or otherwise cease or modify its relationship with AT&T or any of its Subsidiaries; or (iii)
soliciting, encouraging, or inducing any customer or active prospective customer with whom Participant had business contact, whether in person or by other media ("Customer"), on behalf of any Employer Business during the two (2) years prior to the
Participant's Termination of Employment (regardless of the reason for that termination), to terminate, discontinue, renegotiate, reduce, or otherwise cease or modify its relationship with any Employer Business, or to purchase competing goods or services
from a business competing with any Employer Business, or accepting or servicing business from such Customer on behalf of himself or any other business. "Engaging in conduct disloyal to AT&T" shall also mean, disclosing Confidential Information to any
third party or using Confidential Information, other than for an Employer Business, or failing to return any Confidential Information to the Employer Business following termination of employment.
(iv) "Confidential Information" shall mean all information belonging to, or otherwise relating to, an Employer Business, which is not generally known, regardless of the manner in which it is stored or conveyed to Participant, and which the Employer Business has taken reasonable measures under the circumstances to protect from unauthorized use or disclosure. Confidential
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Information includes trade secrets as well as other proprietary knowledge, information, know-how, and non-public
intellectual property rights, including unpublished or pending patent applications and all related patent rights, formulae,
processes, discoveries, improvements, ideas, conceptions, compilations of data, and data, whether or not patentable or
copyrightable and whether or not it has been conceived, originated, discovered, or developed in whole or in part by
Participant. For example, Confidential Information includes, but is not limited to, information concerning the Employer
Business' business plans, budgets, operations, products, strategies, marketing, sales, inventions, designs, costs, legal
strategies, finances, employees, customers, prospective customers, licensees, or licensors; information received from third
parties under confidential conditions; or other valuable financial, commercial, business, technical or marketing
information concerning the Employer Business, or any of the products or services made, developed or sold by the Employer
Business. Confidential Information does not include information that (i) was generally known to the public at the time of
disclosure; (ii) was lawfully received by Participant from a third party; (iii) was known to Participant prior to receipt
from the Employer Business; or (iv) was independently developed by Participant or independent third parties; in each of the
foregoing circumstances, this exception applies only if such public knowledge or possession by an independent third party
was without breach by Participant or any third party of any obligation of confidentiality or non-use, including but not
limited to the obligations and restrictions set forth in this Plan.
(c) Equitable Relief. The parties recognize that any Participant's breach of any of the covenants in this
section will cause irreparable injury to the AT&T, will represent a failure of the consideration under which AT&T (in its
capacity as creator and sponsor of the Plan) agreed to provide the Participant with the opportunity to receive Plan
benefits, and that monetary damages would not provide AT&T with an adequate or complete remedy that would warrant AT&T's
continued sponsorship of the Plan (including the accrual or granting of Share Units, Matching Share Units and Options) for
all Participants. Accordingly, in the event of a Participant's actual or threatened breach of the covenants in this
section, the Committee, in addition to all other rights and acting as a fiduciary under ERISA on behalf of all
Participants, shall have a fiduciary duty (in order to assure that AT&T receives fair and promised consideration for its
continued Plan sponsorship and funding) to seek an injunction restraining the Participant from breaching the covenants in
this Section. AT&T shall pay for any Plan expenses that the Committee incurs hereunder, and shall be entitled to recover
from the Participant its reasonable attorneys' fees and costs incurred in obtaining such injunctive remedies.
(d) Uniform Enforcement. In recognition of AT&T's need for nationally uniform standards for the Plan
administration, it is an absolute condition in consideration of any Participant's ability to make Employee Contribution
elections under Section 4.1 of this Plan after September 1, 2009, that each and all of the following conditions apply to
all such electing Participants:
(i) ERISA shall control all issues and controversies hereunder, and the Committee shall serve for purposes hereof as a "fiduciary" of the Plan and its "named fiduciary" within the meaning of ERISA.
15
(ii) All litigation between the parties relating to this section shall occur in federal court, which shall have exclusive jurisdiction; any such litigation shall be held in the United States District Court for the Northern District of Texas, and the only remedies available with respect to the Plan shall be those provided under ERISA.
8.3 Elections and Notices.
Notwithstanding anything to the contrary contained in this Plan, all elections and notices of every kind under this Plan
shall be made on forms prepared by AT&T or the General Counsel, Secretary or Assistant Secretary, or their respective
delegates or shall be made in such other manner as permitted or required by AT&T or the General Counsel, Secretary or
Assistant Secretary, or their respective delegates, including through electronic means, over the Internet or otherwise. An
election shall be deemed made when received by AT&T (or its designated agent, but only in cases where the designated agent
has been appointed for the purpose of receiving such election), which may waive any defects in form. Unless made
irrevocable by the electing person, each election with regard to making Employee Contributions or distributions of Cash
Deferral Accounts shall become irrevocable at the close of business on the last day to make such election. AT&T may limit
the time an election may be made in advance of any deadline.
If not otherwise specified by this Plan or AT&T, any notice or filing required or permitted to be given to AT&T under the
Plan shall be delivered to the principal office of AT&T, directed to the attention of the Senior Executive Vice President
in charge of Human Resources for AT&T or his or her successor. Such notice shall be deemed given on the date of delivery.
Notice to the Participant shall be deemed given when mailed (or sent by telecopy) to the Participant's work or home address
as shown on the records of AT&T or, at the option of AT&T, to the Participant's e-mail address as shown on the records of
AT&T. It is the Participant's responsibility to ensure that the Participant's addresses are kept up to date on the records
of AT&T. In the case of notices affecting multiple Participants, the notices may be given by general distribution at the
Participants' work locations.
By participating in the Plan, each Participant agrees that AT&T may provide any documents required or permitted under the
Federal or state securities laws, including but not limited to the Securities Act of 1933, as amended, and the Securities
Exchange Act of 1934, as amended, by e-mail, by e-mail attachment, or by notice by e-mail of electronic delivery through
AT&T's Internet Web site or by other electronic means.
8.4 Unsecured General Creditor.
Participants and their beneficiaries, heirs, successors, and assigns shall have no legal or equitable rights, interest, or
claims in any property or assets of any Employer. No assets of any Employer shall be held under any trust for the benefit
of Participants, their beneficiaries, heirs, successors, or assigns, or held in any way as collateral security for the
fulfilling of the obligations of any Employer under this Plan. Any and all of each Employer's assets shall be, and remain,
the general, unpledged, unrestricted assets of such Employer. The only obligation of an Employer under the Plan shall be
merely that of an unfunded and unsecured promise of AT&T to make distributions under and in accordance with the terms of
the Plan.
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8.5 Non-Assignability.
Neither a Participant nor any other person shall have any right to commute, sell, assign, transfer, pledge, anticipate,
mortgage, or otherwise encumber, transfer, hypothecate or convey in advance of actual receipt, any Cash Deferral Account
under the Plan, if any, or any part thereof, which are, and all rights to which are, expressly declared to be unassignable
and non-transferable. No part of a distributable Cash Deferral Account shall, prior to actual distribution, be subject to
seizure or sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by a Participant or
any other person, nor be transferable by operation of law in the event of a Participant's or any other person's bankruptcy
or insolvency.
8.6 Employment Not Guaranteed.
Nothing contained in this Plan nor any action taken hereunder shall be construed as a contract of employment or as giving
any employee any right to be retained in the employ of an Employer or to serve as a director.
8.7 Errors.
At any time AT&T or an Employer may correct any error made under the Plan without prejudice to AT&T or any Employer.
Neither AT&T nor any Employer shall be liable for any damages resulting from failure to timely allow any contribution to be
made to the Plan or for any damages resulting from the correction of, or a delay in correcting, any error made under the
Plan. In no event shall AT&T or any Employer be liable for consequential or incidental damages arising out of a failure to
comply with the terms of the Plan.
8.8 Captions.
The captions of the articles, sections, and paragraphs of this Plan are for convenience only and shall not control nor
affect the meaning or construction of any of its provisions.
8.9 Governing Law.
To the extent not preempted by Federal law, the Plan, and all benefits and agreements hereunder, and any and all disputes
in connection therewith, shall be governed by and construed in accordance with the substantive laws of the State of Texas,
without regard to conflict or choice of law principles which might otherwise refer the construction, interpretation or
enforceability of this Plan to the substantive law of another jurisdiction.
Because benefits under the Plan are granted in Texas, records relating to the Plan and benefits thereunder are located in
Texas, and the Plan and benefits thereunder are administered in Texas, AT&T and the Participant under this Plan, for
themselves and their successors and assigns, irrevocably submit to the exclusive and sole jurisdiction and venue of the
state or Federal courts of Texas with respect to any and all disputes arising out of or relating to this Plan, the subject
matter of this Plan or any benefits under this Plan, including but not limited to any disputes arising out of or relating
to the interpretation and enforceability of any benefits or the terms and conditions of this Plan. To achieve certainty
regarding the appropriate forum in which to prosecute and defend actions arising out of or relating to this Plan, and to
ensure consistency in application and interpretation of the Governing Law to the Plan, the parties agree that (a) sole and
exclusive appropriate venue for any such action shall be an appropriate Federal or state court in Dallas County, Texas, and
no other, (b) all claims with respect to any such action shall be
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heard and determined exclusively in such Texas court, and no other, (c) such Texas court shall have sole and exclusive
jurisdiction over the person of such parties and over the subject matter of any dispute relating hereto and (d) that the
parties waive any and all objections and defenses to bringing any such action before such Texas court, including but not
limited to those relating to lack of personal jurisdiction, improper venue or forum non conveniens.
8.10 Plan to Comply with Section 409A.
In the event any provision of this Plan is held invalid, void, or unenforceable, the same shall not affect, in any respect
whatsoever, the validity of any other provision of this Plan. Notwithstanding any provision to the contrary in this Plan,
each provision in this Plan shall be interpreted to permit the deferral of compensation in accordance with Section 409A of
the Code and any provision that would conflict with such requirements shall not be valid or enforceable.
8.11 Successors and Assigns.
This Plan shall be binding upon AT&T and its successors and assigns.
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EXHIBIT 12
AT&T INC.
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
Dollars in Millions
Three Months Ended
March 31, Year Ended December 31,
(Unaudited)
2017 2016 2016 2015 2014 2013 2012
Earnings:
Income from continuing operations before income taxes $ 5,378 $ 6,007 $ 19,812 $ 20,692 $ 10,355 $ 28,050 $ 10,496
Equity in net income of affiliates included above 173 (13) (98) (79) (175) (642) (752)
Fixed charges 1,906 1,799 7,296 6,592 5,295 5,452 4,876
Distributed income of equity affiliates 8 8 61 30 148 318 137
Interest capitalized (231) (218) (892) (797) (234) (284) (263)
Earnings, as adjusted $ 7,234 $ 7,583 $ 26,179 $ 26,438 $ 15,389 $ 32,894 $ 14,494
Fixed Charges:
Interest expense $ 1,293 $ 1,207 $ 4,910 $ 4,120 $ 3,613 $ 3,940 $ 3,444
Interest capitalized 231 218 892 797 234 284 263
Portion of rental expense representative of interest factor 382 374 1,494 1,675 1,448 1,228 1,169
Fixed Charges $ 1,906 $ 1,799 $ 7,296 $ 6,592 $ 5,295 $ 5,452 $ 4,876
Ratio of Earnings to Fixed Charges 3.80 4.22 3.59 4.01 2.91 6.03 2.97
CERTIFICATION
I, Randall Stephenson, certify that:
1. I have reviewed this report on Form 10-Q of AT&T Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 4, 2017
/s/ Randall Stephenson
Randall Stephenson
Chairman of the Board,
Chief Executive Officer and President
CERTIFICATION
I, John J. Stephens, certify that:
1. I have reviewed this report on Form 10-Q of AT&T Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 4, 2017
/s/ John J. Stephens
John J. Stephens
Senior Executive Vice President
and Chief Financial Officer
Certification of Periodic Financial Reports
Pursuant to 18 U.S.C. Section 1350, each of the undersigned officers of AT&T Inc. (the "Company") hereby certifies that the
Company's Quarterly Report on Form 10-Q for the three months ended March 31, 2017 (the "Report") fully complies with the
requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that information
contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Company.
May 4, 2017 May 4, 2017
By: /s/ Randall Stephenson Randall Stephenson Chairman of the Board, Chief Executive Officer and President By: /s/ John J. Stephens John J. Stephens Senior Executive Vice President and Chief Financial Officer
The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of
the Report or as a separate disclosure document. This certification shall not be deemed "filed" for purposes of Section 18
of the Securities Exchange Act of 1934 ("Exchange Act") or otherwise subject to liability under that section. This
certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the
Exchange Act except to the extent this Exhibit 32 is expressly and specifically incorporated by reference in any such
filing.
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or
otherwise adopting the signature that appears in typed form within the electronic version of this written statement
required by Section 906, has been provided to AT&T Inc. and will be retained by AT&T Inc. and furnished to the Securities
and Exchange Commission or its staff upon request.
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