Exhibit 10.1

EMBARQ CORPORATION

EXECUTIVE SEVERANCE PLAN

 

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ARTICLE I

  

PURPOSE AND TERM OF PLAN

   1

Section 1.01

  

Purpose of the Plan

   1

Section 1.02

  

Term of the Plan

   1

ARTICLE II

  

DEFINITIONS

   1

Section 2.01

  

“Base Salary”

   1

Section 2.02

  

“Board”

   1

Section 2.03

  

“Cause”

   1

Section 2.04

  

“Change in Control”

   2

Section 2.05

  

“CIC Termination”

   3

Section 2.06

  

“COBRA”

   3

Section 2.07

  

“Code”

   3

Section 2.08

  

“Committee”

   3

Section 2.09

  

“Company”

   3

Section 2.10

  

“Competitive Employment”

   3

Section 2.11

  

“Competitor”

   4

Section 2.12

  

“Effective Date”

   4

Section 2.13

  

“Eligible Employee”

   4

Section 2.14

  

“Employee”

   4

Section 2.15

  

“Employer”

   4

Section 2.16

  

“ERISA”

   5

Section 2.17

  

“Exchange Act”

   5

Section 2.18

  

Good Reason Resignation”

   5

Section 2.19

  

“Involuntary Termination”

   5

Section 2.20

  

“Non-CIC Termination”

   6

Section 2.21

  

“Non-Comparable Position”

   6

Section 2.22

  

“Non-Compete Period”

   6

Section 2.23

  

“Non Executive Separation Plan”

   6

Section 2.24

  

“Participant”

   6

Section 2.25

  

“Permanent Disability”

   6

Section 2.26

  

“Plan”

   6

Section 2.27

  

“Plan Administrator”

   6

Section 2.28

  

“Release”

   7

 

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Section 2.29

  

“Service”

   7

Section 2.30

  

“Severance Benefit”

   7

Section 2.31

  

“Severance Period”

   7

Section 2.32

  

“Specified Employee”

   7

Section 2.33

  

“Subsidiary”

   7

Section 2.34

  

“Termination Date”

   7

Section 2.35

  

“Voluntary Resignation”

   8

Section 2.36

  

“Year of Service”

   8

ARTICLE III

  

PARTICIPATION AND ELIGIBILITY FOR BENEFITS

   8

Section 3.01

  

Participation

   8

Section 3.02

  

Conditions

   8

ARTICLE IV

  

DETERMINATION OF SEVERANCE BENEFITS

   9

Section 4.01

  

Non-CIC Termination

   9

Section 4.02

  

CIC Termination

   10

Section 4.03

  

Voluntary Resignation; Termination for Death or Permanent Disability

   13

Section 4.04

  

Termination for Cause

   13

Section 4.05

  

Approved Military Leave

   13

Section 4.06

  

Reduction of Severance Benefits

   13

Section 4.07

  

Certain Terminations

   13

ARTICLE V

  

METHOD OF PAYMENT AND LIMITATION ON BENEFITS

   14

Section 5.01

  

Method of Payment

   14

Section 5.02

  

409(A) Delay

   14

Section 5.03

  

Limitation on Benefits

   14

ARTICLE VI

  

RESTRICTIVE COVENANTS

   15

Section 6.01

  

Principles of Business Conduct

   15

Section 6.02

  

Proprietary Information

   15

Section 6.03

  

Non-Competition

   16

Section 6.04

  

Inducement of Employees, Customers and Others

   16

Section 6.05

  

No Adverse Actions

   16

Section 6.06

  

Return of Property

   17

Section 6.07

  

Non-Disparagement

   17

Section 6.08

  

Assistance with Claims

   17

 

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Section 6.09

  

Reasonableness

   17

Section 6.10

  

Equitable Relief

   18

Section 6.11

  

Survival of Provisions

   18

ARTICLE VII

  

COMMITTEE; PLAN ADMINISTRATOR

   18

Section 7.01

  

Authority and Duties

   18

Section 7.02

  

Compensation of the Plan Administrator and the Committee

   19

Section 7.03

  

Records, Reporting and Disclosure

   19

Section 7.04

  

Discretion

   19

ARTICLE VIII

  

AMENDMENT, SUSPENSION AND TERMINATION

   19

Section 8.01

  

Amendment, Suspension and Termination

   19

Section 8.02

  

Continuation of Plan following a Change in Control

   20

ARTICLE IX

  

CLAIMS PROCEDURES

   20

Section 9.01

  

Claims

   20

Section 9.02

  

Initial Claim

   20

Section 9.03

  

Appeals of Denied Administrative Claims

   21

Section 9.04

  

Appointment of the Named Appeals Fiduciary

   21

ARTICLE X

  

MISCELLANEOUS

   22

Section 10.01

  

Waiver of Jury Trial

   22

Section 10.02

  

Forum Selection

   22

Section 10.03

  

Nonalienation of Benefits

   22

Section 10.04

  

Notices

   22

Section 10.05

  

No Mitigation

   22

Section 10.06

  

No Contract of Employment

   23

Section 10.07

  

Severability of Provisions

   23

Section 10.08

  

Headings and Captions

   23

Section 10.09

  

Gender and Number

   23

Section 10.10

  

Unfunded Plan

   23

Section 10.11

  

Payments to Incompetent Persons

   23

Section 10.12

  

Lost Payees

   23

Section 10.13

  

Section 409(A) Compliance

   23

Section 10.14

  

Controlling Law

   24

EXHIBIT A

  

Participation Agreement

   A

Release

   1

Arbitration Provision

   6

 

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ARTICLE I

PURPOSE AND TERM OF PLAN

Section 1.01 Purpose of the Plan. The purposes of the Plan are to attract,
retain and motivate Eligible Employees upon whom, in large measure, the
substantial progress, growth and profitability of the Company depends, as well
as, to provide them with a measure of financial protection and assistance in the
transition from Embarq employment in the event the Eligible Employee’s
employment with the Company or a Subsidiary is terminated due to a Non-CIC
Termination or a CIC Termination. The Plan is not intended to be an “employee
pension benefit plan” or “pension plan” within the meaning of section 3(2) of
ERISA. Rather, this Plan is intended to be a “welfare benefit plan” within the
meaning of Section 3(1) of ERISA and to meet the descriptive requirements of a
plan constituting a “severance pay plan” within the meaning of regulations
published by the Secretary of Labor at Title 29, CFR, section 2510.3-2(b).
Accordingly, the benefits paid by the Plan are not deferred compensation and no
employee shall have a vested right to such benefits.

Section 1.02 Term of the Plan. The Plan shall generally be effective as of the
Effective Date. The Plan supersedes, and does not duplicate, the provisions of
the Non-Executive Separation Plan in any case in which an Eligible Employee
would otherwise be entitled to severance or related benefits under both this
Plan and the Non-Executive Separation Plan arising out of the Eligible
Employee’s Non-CIC Termination. Moreover, this Plan supersedes any other plan,
program, arrangement or agreement providing an Eligible Employee with severance
or related benefits, including the Non Executive Separation Plan, with respect
to an Eligible Employee’s CIC Termination or Non-CIC Termination to the extent
provided in Section 3.01. The Plan shall continue until terminated pursuant to
Article VIII of the Plan.

ARTICLE II

DEFINITIONS

Section 2.01 “Base Salary” means the annual rate of base salary in effect on the
Participant’s Termination Date or the date of the Change in Control, if higher.

Section 2.02 “Board” means the Board of Directors of the Company, or any
successor thereto, or a committee thereof specifically designated for purposes
of making determinations hereunder.

Section 2.03 “Cause” means an Eligible Employee’s (i) willful and continued
failure to substantially perform his or her duties, (ii) willfully engaging in
conduct that is a serious violation of the Employer’s Principles of Business
Conduct, (iii) willfully engaging in conduct that is demonstrably and materially
injurious to the Employer or (iv) willful violation of any of the restrictive
covenants found in Article VI. The Committee shall determine Cause.

 

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Section 2.04 “Change in Control” means any of the following events:

(a) the acquisition , directly or indirectly, by any “person” or “group” (as
those terms are defined in sections 3(a)(9), 13(d), and 14(d) of the Exchange
Act and the rules thereunder, including Rule 13d-5(b)) of “beneficial ownership”
(as determined pursuant to Rule 13d-3 under the Exchange Act) of securities
entitled to vote generally in the election of directors (‘voting securities”) of
the Company that represent 30% or more of the combined voting power of the
Company’s then outstanding voting securities, other than

(i) an acquisition by a trustee or other fiduciary holding securities under any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any person controlled by the Company or by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any person controlled
by the Company, or

(ii) an acquisition of voting securities by the Company or a corporation owned,
directly or indirectly, by the stockholders of at least 50% of the voting power
of the Company’s then outstanding securities in substantially the same
proportions as their ownership of stock of the Company, or

(iii) an acquisition of voting securities pursuant to a transaction described in
Section 2.04(c) below that would not be a Change in Control under
Section 2.04(c);

(b) a change in the composition of the Board that causes less than a majority of
the directors of the Company to be directors that meet one or more of the
following descriptions:

(i) a director who has been a director of the Company for a continuous period of
at last 24 months (or, if less, since the date the shares of Company common
stock were listed on the New York Stock Exchange) or,

(ii) a director whose election or nomination as a director was approved by a
vote of at least two-thirds of the then directors described in subsections
2.04(b)(i), (ii) or (iii) by prior nomination or election, but excluding, for
the purpose of this subsection (ii), any director whose initial assumption to
office occurred as a result of an actual or threatened (y) election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a person or group other
than the Board or (z) tender offer, merger, sale of substantially all of the
Company’s assets, consolidation, reorganization or business combination that
would be a Change in Control under Section 2.04(c) on consummation thereof, or

(iii) who were serving on the Board as result of the consummation of a
transaction described in Section 2.04(c) that would not be a Change in Control
under Section 2.04(c);

(c) the consummation by the Company (whether directly involving the Company or
indirectly involving the Company through one or more intermediaries) of

(i) a consolidation, merger, reorganization or business combination or

 

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(ii) a sale or disposition of all or substantially all of the Company’s assets
or

(iii) the acquisition of assets or stock of another entity,

in each case, other than in a transaction, (x) that results in the Company’s
voting securities outstanding immediately before the transaction continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the Company or the person that, as a result of the transaction,
controls, directly or indirectly, the Company or owns, directly or indirectly,
all or substantially all of the Company’s assets or otherwise succeeds to the
business of the Company (the Company or such person, the “Successor Entity”))
directly or indirectly, at least 50% of the combined voting power of the
Successor Entity’s outstanding voting securities immediately after the
transaction and (y) after which more than 50% of the members of the Board of the
Successor Entity were members of the Board at the time of the Board’s approval
of the transaction or other action of the Board approving the transaction (or
whose election or nomination was approved by a vote of at least two-thirds of
the members who were members of the Board at that time), and (z) after which no
person or group beneficially owns voting securities representing 30% or more of
the combined voting power of the Successor Entity; provided, however, no person
or group shall be treated for purposes of this subsection (z) as beneficially
owning 30% or more of combined voting power of the Successor Entity solely as a
result of the voting power held in the Company before the consummation of the
transaction; or

(d) a liquidation or dissolution of the Company other than in connection with a
transaction described in subsection 2.04(c) above that would not be a Change in
Control thereunder.

Section 2.05 “CIC Termination” means an Eligible Employee’s Involuntary
Termination or Good Reason Resignation that occurs within 6 months before or one
year after the date of a Change in Control.

Section 2.06 “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended.

Section 2.07 “Code” means the Internal Revenue Code of 1986, as amended.

Section 2.08 “Committee” means the Compensation Committee of the Board or such
other committee appointed by the Board to assist the Company in making
determinations required under the Plan in accordance with its terms. The
“Committee” may delegate its authority under the Plan to one or more individuals
or another committee which may or may not include members of the Board.

Section 2.09 “Company” means Embarq Corporation and any successor thereto.

Section 2.10 “Competitive Employment” means the direct or indirect performance
of duties or responsibilities (whether paid or unpaid and whether as a
consultant, employee or otherwise) for a Competitor, including, without
limitation, the ownership of any interest in, the provision of any financing,
management or advisory services to, any connection with or being a principal,
partner or agent of, any Competitor; provided that the Eligible Employee may
passively own less than 1% of the outstanding shares of any Competitor.

 

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Section 2.11 “Competitor” means any one or more of the following:

(a) any person doing business in the United States or any of its Divisions
(i.e., any distinct group or unit organized as a segment or portion of a person
that is devoted to the production, provision or management of a common product
or service or group of related products or services, regardless of whether the
group is organized as a legally distinct entity) employing the Eligible Employee
if the person or its Division receives at least 15% of its gross U.S. operating
revenues from a line of business in which the Company receives at least 3% of
its gross U.S. operating revenues;

(b) any person doing business in the United States or any of its Divisions
employing the Eligible Employee, operating for less than five years a line of
business from which the Company derives at least 3% of its gross U.S. operating
revenues, notwithstanding such person’s or Division’s lack of substantial
revenues in such line of business; or

(c) any person doing business in the United States or any of its Divisions
employing the Eligible Employee if the person or its Division receives at least
15% of its gross U.S. operating revenues from a line of business in which the
Company has operated for less than five years, notwithstanding the Company’s
lack of substantial revenues in such line of business.

For purposes of the foregoing, gross U.S. operating revenues of the Company and
such other person shall be those of the Company or such person, together with
their consolidated affiliates (with whom the financial statements of such person
are required, under generally accepted accounting principles, to be reported on
a consolidated basis), but those of the Division then employing and the Division
proposing to employ the Eligible Employee shall each be on a stand-alone basis,
all measured by the most recent available financial information of both the
Company and such other person or Division at the time the Eligible Employee
accepts, or proposes to accept employment with or to otherwise perform services
for such person. If financial information is not publicly available or is
inadequate for purposes of applying this definition, the burden shall be on the
Eligible Employee to demonstrate that such person is not a Competitor.

Section 2.12 “Effective Date” means July 1, 2007.

Section 2.13 “Eligible Employee” means an Employee who is in the Director job
tier or above. If there is any question as to whether an Employee is deemed an
Eligible Employee for purposes of the Plan, the Committee shall make the
determination.

Section 2.14 “Employee” means an individual employed by the Employer as a common
law employee, and shall not include any person working for the Employer through
a temporary service or on a leased basis or who is hired by the Employer as an
independent contractor, consultant, or otherwise as a person who is not an
employee, or not treated as such, for purposes of withholding federal employment
taxes, as evidenced by payroll records or a written agreement with the
individual, regardless of any contrary governmental or judicial determination or
holding relating to such status or tax withholding. Any change of
characterization of an individual shall take effect on the actual date of such
change without regard to any retroactive recharacterization.

Section 2.15 “Employer” means the Company and its Subsidiaries.

 

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Section 2.16 “ERISA” means the Employee Retirement Income Security Act of 1974,
as amended, and regulations thereunder.

Section 2.17 “Exchange Act” means the Securities Exchange Act of 1934, as
amended.

Section 2.18 Good Reason Resignation” means an Eligible Employee’s written
resignation within 90 days of the occurrence of any of the following
circumstances that occurs within 6 months before or 12 months after the date of
a Change in Control, unless such circumstances are fully corrected by the
Employer within 30 days following written notice from the Eligible Employee:

(a) a substantial adverse alteration in the nature or status of the Eligible
Employee’s duties from those immediately before the Change in Control or any
reduction in the Eligible Employee’s job grade or tier, if applicable;

(b) a reduction in the Eligible Employee’s Base Salary, except for an across the
board reduction similarly affecting all Eligible Employees of the Company in the
affected Eligible Employee’s job tier, of more than 10% of the Eligible
Employee’s Base Salary in effect on the date of the Change in Control;

(c) a reduction in the Eligible Employee’s total incentive compensation
opportunity (which includes short term target incentive opportunity and long
term incentive target opportunity), except for an across the board reduction
similarly affecting all Eligible Employees of the Company in the affected
Eligible Employee’s job tier, of more than 20% of the Eligible Employee’s total
incentive compensation opportunity in effect on the date of the Change in
Control;

(d) relocation of the Eligible Employee’s principal place of business to a
location more than 75 miles from its current location;

(e) the Company’s failure to provide the Eligible Employee with retirement,
health, welfare and fringe benefits substantially similar in the aggregate to
those he or she enjoyed under the Company’s benefit plans in which the Eligible
Employee was participating at the time of the Change in Control, unless an
equitable arrangement has been made on a basis not materially less favorable
both in terms of the amount of benefits and the level of participation relative
to other similarly situated executives, except for an across the board reduction
similarly affecting all Eligible Employees of the Company; or

(f) the Company’s failure to obtain an agreement from any successor to assume
and agree to continue this Plan for at least one year with respect to Eligible
Employees who were employed by the Employer at the time of a Change in Control.
If the Company elects not to correct such events or conditions or otherwise
fails to so cure such events or conditions within the 30-day cure period, the
eligible Employee may terminate his employment with the Company based upon the
Eligible Employee’s Good Reason Resignation within 30 days after the expiration
of the “cure” period. The decision to terminate employment must result in actual
termination of employment, in order to be considered a Good Reason Resignation.

Section 2.19 “Involuntary Termination” means a termination of the Eligible
Employee’s employment, initiated by the Employer for any reason other than
Cause, Permanent Disability or death. An Eligible Employee’s refusal to accept a
Non-Comparable Position is considered an Involuntary Termination.

 

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Section 2.20 “Non-CIC Termination” means an Eligible Employee’s Involuntary
Termination of employment prior to a Change in Control.

Section 2.21 “Non-Comparable Position” means a new job position offered to an
Eligible Employee that reflects either of the following circumstances:

(a) a reduction in the Eligible Employee’s Base Salary, except for an across the
board reduction similarly affecting all Eligible Employees of the Company in the
affected Eligible Employee’s job tier, of more than 10% of the Eligible’s
Employee’s Base Salary in effect immediately prior to the new job position;

(b) a reduction in the Eligible Employee’s total incentive compensation
opportunity (which includes short term target incentive opportunity and long
term incentive target opportunity), except for an across the board reduction
similarly affecting all Eligible Employees of the Company in the affected
Eligible Employee’s job tier, of more than 20% of the Eligible Employee’s total
incentive compensation opportunity in effect immediately prior to the new job
position; or

(c) for Eligible Employees in the Company’s director job tier at the time of the
new job offer, relocation of the Eligible Employee’s principal place of business
to a location more than 75 miles from its current location.

Section 2.22 “Non-Compete Period” means the period of time, as specified in
Section 6.03(c), during which certain of the restrictive covenants in Article VI
shall be enforceable.

Section 2.23 “Non Executive Separation Plan” means the Embarq Corporation
Separation Plan, which plan is superseded by this Plan with respect to each
Eligible Employee’s participation in such plan in the event of any Participant’s
termination of employment.

Section 2.24 “Participant” means any Eligible Employee who meets the
requirements of Article III and thereby becomes eligible for salary continuation
and other benefits under the Plan.

Section 2.25 “Permanent Disability” means that an Eligible Employee has a
permanent and total incapacity from engaging in any employment for the Employer
for physical or mental reasons. A “Permanent Disability” shall be deemed to
exist if the Eligible Employee is judged to satisfy the requirements for
disability benefits under the Company’s long-term disability plan or the
requirements for disability benefits under the Social Security law then in
effect.

Section 2.26 “Plan” means the Embarq Corporation Executive Severance Plan, as
set forth herein, as the same may be amended from time to time.

Section 2.27 “Plan Administrator” means one or more individuals appointed by the
Committee to administer the terms of the Plan as set forth herein and if no
individual is appointed by the Committee to serve as the Plan Administrator for
the Plan, the Plan Administrator shall be the Senior Vice President of Human
Resources (or the equivalent).

 

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Notwithstanding the preceding sentence, in the event the Plan Administrator is
entitled to Severance Benefits under the Plan, the Committee or its delegate
shall act as the Plan Administrator for purposes of administering the terms of
the Plan with respect to the Plan Administrator. The Plan Administrator may
delegate all or any portion of its authority under the Plan to any other
person(s).

Section 2.28 “Release” means the Separation of Employment Agreement and General
Release, substantially in the form attached hereto as Exhibit B, as the same may
be amended from time to time.

Section 2.29 “Service” means the total number of years and completed months the
Participant was an Employee of the Employer. Service with any predecessor
employer or with a Subsidiary prior to the Subsidiary’s becoming part of the
Employer shall be recognized only to the extent specified in the merger or
acquisition documentation. Periods of authorized leave of absence, such as
military leave, will be included in Service only to the extent required by
applicable law. Any period of employment with the Company, a Subsidiary, or a
predecessor employer for which an Eligible Employee previously received
severance benefits, shall be excluded from Service.

Section 2.30 “Severance Benefit” means the salary replacement amounts and other
benefits that a Participant is eligible to receive pursuant to Article IV of the
Plan.

Section 2.31 “Severance Period” means the period of time for which a Participant
is entitled to receive Severance Benefits pursuant to Article IV of the Plan.

Section 2.32 “Specified Employee” means (i) an officer of the Company or its
Subsidiaries having annual compensation greater than $135,000 (adjusted for
inflation as described in section 416(i) of the Code), (ii) a 5 percent owner of
the Company and its Subsidiaries, or (iii) a one percent owner of the Company
and its Subsidiaries who has annual compensation from the Company and its
Subsidiaries greater than $150,000, as determined by the Committee in accordance
with section 409A of the Code. The number of officers who are considered
Specified Employees shall be limited to 50 employees as described in section
416(i) of the Code. The Committee shall determine the Specified Employees each
year in accordance with section 416(i) of the Code, the “specified employee”
requirements of section 409A of the Code, and applicable regulations. Effective
January 1, 2008, Specified Employees shall be identified as of December 31 of
each year with respect to the 12-month period beginning on the next following
April 1.

Section 2.33 “Subsidiary” means (i) a subsidiary of the Company (wherever
incorporated), (ii) any separately organized business unit, whether or not
incorporated, of the Company, and (iii) any employer that is required to be
aggregated with the Company pursuant to section 414 of the Code and regulations
issued thereunder.

Section 2.34 “Termination Date” means the date on which the active employment of
the Eligible Employee by the Employer is severed, whether by reason of an
Involuntary Termination, Voluntary Resignation, Good Reason Resignation or
Termination for Cause.

 

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Section 2.35 “Voluntary Resignation” means any retirement or termination of
employment that is not initiated by the Employer other than a Good Reason
Resignation.

Section 2.36 “Year of Service” means each completed year of Service.

ARTICLE III

PARTICIPATION AND ELIGIBILITY FOR BENEFITS

Section 3.01 Participation. Each Eligible Employee who incurs a CIC Termination
or a Non-CIC Termination and who satisfies the conditions of Section 3.02 shall
be a Participant and shall receive the Severance Benefits described in the Plan.
Participation in the Plan is expressly conditioned upon the Eligible Employee
executing a Participation Agreement, substantially in the form attached hereto
as Exhibit A, pursuant to which the Eligible Employee agrees to be bound by the
restrictive covenants set forth in Article VI as of the date of execution of the
Participation Agreement. If an Eligible Employee is a party to an employment
agreement with the Employer pursuant to which he or she is entitled to severance
benefits upon his or her termination of employment, such Eligible Employee must
agree to forego the severance benefits provided under the employment agreement
and affirmatively elect to participate in the Plan by executing a Participation
Agreement. Upon execution of a Participation Agreement, such Eligible Employee’s
employment agreement shall be null and void. An Eligible Employee shall not be
eligible to receive any other severance benefits from the Employer on account of
a CIC Termination or a Non-CIC Termination, including pursuant to the Non
Executive Separation Plan, unless otherwise provided in this Plan.

Section 3.02 Conditions.

(a) Eligibility for any Severance Benefits is expressly conditioned on the
Eligible Employee’s (i) execution of a Release in connection with his or her
termination of employment with the Employer; (ii) compliance with all the terms
and conditions of such Release; (iii) execution of a Participation Agreement
binding the Eligible Employee to the restrictive covenants set forth in Article
VI during and after the Participant’s employment with the Employer;
(iv) compliance with all the terms and conditions of such Participation
Agreement and the restrictive covenants set forth in Article VI; (v) execution
of a written agreement that authorizes the deduction of amounts owed to the
Employer prior to the payment of any Severance Benefit (or in accordance with
any other schedule as the Plan Administrator may determine to be appropriate);
and (vi) acknowledgement that all decisions and determinations of the Board, the
Committee and the Plan Administrator shall be final and binding on the Eligible
Employee, his or her beneficiaries and any other person having or claiming an
interest under the Plan on his or her behalf.

(b) If the Plan Administrator determines that the Participant has not fully
complied with any of the terms of the Plan, the Participation Agreement and/or
the Release, the Plan Administrator, acting on behalf of the Company, may deny
Severance Benefits not yet in pay status or discontinue the payment of the
Participant’s Severance Benefits and may require the Participant to repay any
portion of any Severance Benefits already received under the Plan,

 

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by providing written notice of such repayment obligation to the Participant. If
the Plan Administrator notifies a Participant that repayment of all or any
portion of the Severance Benefit received under the Plan is required, such
amounts shall be repaid within 30 calendar days of the date the written notice
is sent. Any remedy under this subsection (b) shall be in addition to, and not
in place of, any other remedy, including injunctive relief, that the Company may
have.

ARTICLE IV

DETERMINATION OF SEVERANCE BENEFITS

Section 4.01 Non-CIC Termination. The Severance Benefits to be provided to a
Participant who incurs a Non-CIC Termination and becomes a Participant shall be
as follows:

(a) Base Salary. The Participant shall receive his or her Base Salary for the
Severance Period applicable to the Participant as follows:

(i) If the Participant is a Director, he or she shall be entitled to receive 6
weeks of Base Salary plus an additional 2 weeks of Base Salary for each Year of
Service up to a maximum of 52 weeks.

(ii) If the Participant is a Vice President, he or she shall be entitled to
receive 12 weeks of Base Salary plus an additional 2 weeks of Base Salary for
each Year of Service up to a maximum of 52 weeks.

(iii) If the Participant is a Senior Vice President or above, he or she shall be
entitled to receive 52 weeks of Base Salary.

(b) Short-Term Incentive Payment. The Participant shall receive an additional,
single lump sum payment based on his target opportunity under the Short-Term
Incentive Program equal to 80% of the Participant’s target opportunity for the
fiscal year in which the Termination Date occurs, prorated based on the length
of the Severance Period.

(c) Continued Employee Benefits. All Participants shall continue to be eligible
to participate in the Company’s Flexible Benefit Program (or successor thereto,
but excluding participation in the supplemental long-term disability plan) and
the Employee Assistance Program (or generally comparable coverage) for himself
or herself and, where applicable, his or her eligible dependents, as the same
may be changed from time to time for employees of the Employer generally, as if
the Participant had continued in employment during the Severance Period. In
accordance with the provisions of the Company’s Short-Term Disability Plan and
the Company’s Basic Long-Term Disability Plan, a Participant shall not be
eligible to participate in or receive benefits from these plans during the
Severance Period. The Participant shall be responsible for the payment of the
employee portion of the contributions that are required during the Severance
Period and such contributions shall be made within the time period and in the
amounts that Employees are required to pay to the Employer for similar coverage.
The Participant’s failure to pay the applicable contributions shall result in
the cessation of the applicable coverage for the Participant and his or her
eligible dependents. Notwithstanding any other provision of the Plan to the
contrary, in the event that a Participant commences employment with another
company at any time during the Severance Period, the

 

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Participant will cease receiving coverage under the Employer’s benefit plans if
eligible for coverage under the other company’s benefit plans. Within 30 days of
a Participant’s commencement of employment with another company, the Participant
shall provide the Company written notice of such employment and provide
information to the Company regarding the benefits provided to the Participant by
his or her new employer. The COBRA continuation coverage period under section
4980B of the Code shall begin coincident with the first day of the month
following the Severance Period, or the first day of the month following the
commencement of coverage with another company, whichever occurs first.

(d) Retirement Plans. The provisions of the Embarq Retirement Pension Plan and
the Embarq Retirement Savings Plan, any successor plans thereto or any other
retirement plans maintained by the Company pursuant to which a Participant is
eligible to participate, shall control with respect to the recognition of
service during the Severance Period and the eligibility for benefits following
the Severance Period.

(e) Equity. The provisions of the Embarq Corporation 2006 Equity Incentive Plan,
any successor plan thereto or any other equity compensation plan maintained by
the Company pursuant to which a Participant has received an equity grant, and
the Participant’s relevant grant agreement shall control with respect to the
treatment of the Participant’s equity grants upon the Participant’s Non-CIC
Termination.

(f) Outplacement Services. The Company will pay the cost of outplacement
services for the Participant at the outplacement agency designated by the
Company and in accordance with the Company’s procedures regarding outplacement
services unless the Company provides prior approval for the Participant to use
another outplacement agency.

Section 4.02 CIC Termination. The Severance Benefits to be provided to a
Participant who incurs a CIC Termination and becomes a Participant shall be as
follows:

(a) Base Salary. The Participant shall receive his or her Base Salary for the
Severance Period applicable to the Participant as follows:

(i) If the Participant is a Director, he or she shall be entitled to receive 6
weeks of Base Salary plus an additional 2 weeks of Base Salary for each Year of
Service up to a maximum of 52 weeks, but in no event less than 39 weeks.

(ii) If the Participant is a Vice President, he or she shall be entitled to
receive 52 weeks of Base Salary.

(iii) If the Participant is a Senior Vice President, he or she shall be entitled
to receive 78 weeks of Base Salary.

(iv) If the Participant is the Chief Executive Officer, Chief Financial Officer,
General Counsel, President Consumer Markets or President Business Markets, he or
she shall be entitled to receive 104 weeks of Base Salary.

(b) Short-Term Incentive Payment. The Participant shall receive an additional,
single lump sum payment based on his target opportunity under the Short-Term
Incentive Program equal to 80% of the Participant’s target opportunity for the
fiscal year in which the Termination Date occurs, prorated based on the length
of the Severance Period.

 

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(c) Continued Employee Benefits. All Participants shall continue to be eligible
to participate in the Company’s Flexible Benefit Program (or successor thereto,
but excluding participation in the supplemental long-term disability plan) and
the Employee Assistance Program (or generally comparable coverage) for himself
or herself and, where applicable, his or her eligible dependents, as the same
may be changed from time to time for employees of the Employer generally, as if
the Participant had continued in employment during the Severance Period. In
accordance with the provisions of the Company’s Short-Term Disability Plan and
the Company’s Basic Long-Term Disability Plan, a Participant shall not be
eligible to participate in or receive benefits from these plans during the
Severance Period. The Participant shall be responsible for the payment of the
employee portion of the contributions that are required during the Severance
Period and such contributions shall be made within the time period and in the
amounts that Employees are required to pay to the Employer for similar coverage.
The Participant’s failure to pay the applicable contributions shall result in
the cessation of the applicable coverage for the Participant and his or her
eligible dependents. In the event that a Participant’s Severance Period is
longer than 18 months, beginning with the first day of the nineteenth month, the
Participant will no longer be eligible to participate in the Flexible Benefit
Program and the Company shall provide such Participant with an after-tax amount
sufficient to cover the employer-paid portion of the cost of the continued
medical, dental and vision coverage on the twelfth business day of each month
beginning with the nineteenth month of the Severance Period and ending with the
last month of the Severance Period. Notwithstanding any other provision of the
Plan to the contrary, in the event that a Participant commences employment with
another company at any time during the Severance Period, the Participant will
cease receiving coverage under the Employer’s benefit plans if eligible for
coverage under the other company’s benefit plans. Within 30 days of a
Participant’s commencement of employment with another company, the Participant
shall provide the Company written notice of such employment and provide
information to the Company regarding the benefits provided to the Participant by
his or her new employer. The COBRA continuation coverage period under section
4980B of the Code shall begin coincident with (i) the first day of the month
following the Severance Period, (ii) the first day of the month following the
commencement of coverage with another company, or (iii) in the event the
Participant’s Severance Period is longer than 18 months, the first day of the
nineteenth month, whichever occurs first.

(d) During the first 18 months of the Continuation Period (or, if shorter or
longer, during the period in which you are eligible to elect COBRA continuation
coverage under health and dental plans of the Company) (the “COBRA Period”), the
Company will pay you a monthly payment on the first payroll date of each month
equal to the COBRA cost of continued health and dental coverage under health and
dental plans of the Company pursuant to section 4980B of the Internal Revenue
Code of 1986, as amended (the “Internal Revenue Code”), less the amount that you
would be required to contribute for health and dental coverage if you were an
active employee. These payments will commence on the Company’s first payroll
date after the Termination Date and will continue until the end of the COBRA
Period (but not longer than 36 months after the Termination Date).

 

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(e) After the COBRA Period and during the balance of the Continuation Period, if
any, the Company will pay you a quarterly payment on the first payroll day of
each calendar quarter equal to the premium cost that you will incur during the
quarter to maintain health and dental coverage that is substantially similar to
the health and dental coverage that was in effect for you under plans of the
Company immediately before such coverage ended, as reasonably determined by you
and the Company, less the amount that you would be required to contribute for
health and dental coverage if you were an active employee.

(f) During the Continuation Period, the Company will pay you a quarterly payment
on the first payroll day of each calendar quarter equal to the premium cost that
you will incur during the quarter to maintain life insurance coverage under the
converted policy that will be available to you upon your termination of
employment with the Company.

(g) On each date on which a payment is made under subsection (a), (b) or
(c) above, the Company will pay you an additional amount equal to the federal,
state and local income and payroll taxes that you incur on the amount paid under
subsection (a), (b) or (c). This gross up payment will be made with respect to
each payment under subsection (a), (b) and (c) and will cease when payments
under subsection (a), (b) and (c) cease.

(h) The Company will pay you a lump sum amount equal to the aggregate value of
any remaining employer benefits provided by or through the Company, to which you
would otherwise be entitled during the Continuation Period following your
termination of employment. Such payment shall be paid in a single lump sum
within forty five (45) days of Employee’s termination of employment.

(i) Notwithstanding the above, the Company’s obligation to provide the payments
in this Section 3 shall cease upon your obtaining new employment that provides
you with eligibility for medical and dental benefits and disability insurance
without a pre-existing condition limitation.

(j) Retirement Plans. The provisions of the Embarq Retirement Pension Plan and
the Embarq Retirement Savings Plan, any successor plans thereto or any other
retirement plans maintained by the Company pursuant to which a Participant is
eligible to participate, shall control with respect to the recognition of
service during the Severance Period and the eligibility for benefits following
the Severance Period.

(k) Equity. The provisions of the Embarq Corporation 2006 Equity Incentive Plan,
any successor plan thereto or any other equity compensation plan maintained by
the Company pursuant to which a Participant has received an equity grant, and
the Participant’s relevant grant agreement shall control with respect to the
treatment of the Participant’s equity grants upon the Participant’s CIC
Termination.

(l) Outplacement Services. The Company will pay the cost of outplacement
services for the Participant at the outplacement agency designated by the
Company and in accordance with the Company’s procedures regarding outplacement
services unless the Company provides prior approval for the Participant to use
another outplacement agency.

 

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Section 4.03 Voluntary Resignation; Termination for Death or Permanent
Disability. If the Eligible Employee’s employment terminates on account of the
Eligible Employee’s (i) Voluntary Resignation, (ii) death, or (iii) Permanent
Disability, then the Eligible Employee shall not be entitled to receive
Severance Benefits under this Plan and shall be entitled only to those benefits
(if any) as may be available under the Employer’s then-existing benefit plans
and policies at the time of such termination.

Section 4.04 Termination for Cause. If any Eligible Employee’s employment
terminates on account of termination by the Employer for Cause, the Eligible
Employee shall not be entitled to receive Severance Benefits under this Plan.
Notwithstanding any other provision of the Plan to the contrary, if the
Committee determines that a Participant engaged in conduct that constitutes
Cause at any time prior to the Participant’s Termination Date, any Severance
Benefits payable to the Participant under Section 4.01 or 4.02 of the Plan shall
immediately cease, and the Participant shall be required to return any Severance
Benefits paid to the Participant prior to such determination. The Employer may
withhold paying Severance Benefits under the Plan pending resolution of an
inquiry that could lead to a determination that Cause exists.

Section 4.05 Approved Military Leave. An Eligible Employee returning from
approved military leave within one year after a Change in Control will be
eligible for Severance Benefits if: (a) he or she is eligible for reemployment
under the provisions of the Uniformed Services Employment and Reemployment
Rights Act (USERRA); (b) his or her pre-military leave job is eliminated; and
(c) the Employer’s circumstances are changed so as to make reemployment in
another position impossible or unreasonable, or re-employment would create an
undue hardship for the Employer. If the Eligible Employee qualifies for
Severance Benefits under this Section 4.05, his or her severance benefits will
be calculated as if the Eligible Employee had remained continuously employed
from the date he or she began his or her military leave. The Eligible Employee
must also satisfy any other relevant conditions for payment, including execution
of a Release.

Section 4.06 Reduction of Severance Benefits. The Plan Administrator reserves
the right to make deductions in accordance with applicable law for any monies
owed to the Employer by the Participant or the value of Employer property that
the Participant has retained in his or her possession.

Section 4.07 Certain Terminations. If the Eligible Employee’s employment
terminates on account of (i) a sale of an Employer, or of assets of that
Employer, or merger, or other transaction involving that Employer, (ii) a
spin-off of an Employer or a portion of an Employer, or (iii) an outsourcing of
the functions of an Employer, and, in any such case, the Eligible Employee is
offered a job position with the successor or new company that is not a
Non-Comparable Position or the Eligible Employee accepts a Non-Comparable
Position with the successor or new company, then the Eligible Employee will not
be entitled to receive Severance Benefits under this Plan and will be entitled
only to those benefits (if any) as may be available under the Employer’s
then-existing benefit plans and policies at the time of such termination.

 

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ARTICLE V

METHOD OF PAYMENT AND LIMITATION ON BENEFITS

Section 5.01 Method of Payment. The cash Severance Benefits payable under
Sections 4.01 or 4.02 above, as applicable, attributable to (a) a Participant’s
Base Salary, shall be paid pursuant to the Company’s normal payroll practices
commencing within 30 days following the Participant’s Termination Date, and
(b) the Short-Term Incentive payment payable under Section 4.01(b) or 4.02(b),
shall be paid at the time of the last Base Salary payment pursuant to subsection
(a) above; subject to Participant’s execution of an effective Release required
under Section 3.02. In no event will interest be credited on the unpaid balance
for which a Participant may become eligible. Payment shall be made by direct
deposit or by mailing to the last address provided by the Participant to the
Employer or such other reasonable method as determined by the Plan
Administrator. All payments of Severance Benefits are subject to applicable
federal, state and local taxes and withholdings. In the event of the
Participant’s death after he or she becomes eligible for Severance Benefits
under the Plan, but prior to full payment of all Severance Benefits due to such
Participant, any remaining Severance Benefits due to the Participant shall be
paid to the Participant’s estate in a lump sum payment within 60 days following
written notification of the Participant’s death.

Section 5.02 409(A) Delay. Notwithstanding Section 5.01 above, if at the time of
an Eligible Employee’s termination of employment with the Employer, the Company
has securities which are publicly-traded on an established securities market and
the Eligible Employee is a “Specified Employee” and the deferral of the
commencement of any severance payments otherwise payable pursuant to the Plan as
a result of such termination of employment is necessary in order to prevent any
accelerated or additional tax under section 409A of the Code, then the Employer
will defer the commencement of the payment of any such payments or benefits
hereunder (without any reduction in such payments or benefits ultimately paid or
provided to the Specified Employee) that are not otherwise paid within the
short-term deferral exception under section 409A of the Code and are in excess
of the lesser of two (2) times (i) the Specified Employee’s then-annual
compensation or (ii) the limit on compensation then set forth in section
401(a)(17) of the code, until the first payroll date that occurs after the date
that is six (6) months following the Specified Employee’s “separation from
service” (as defined under section 409A of the Code) with the Employer. If any
payments are deferred due to such requirements, such amounts will be paid in a
lump sum to the Specified Employee on the first payroll date that occurs after
the date that is six (6) months following the Specified Employee’s “separation
from service” with the Employer. If the Specified Employee dies during the
postponement period prior to the payment of the postponed amount, the amounts
withheld on account of section 409A of the Code shall be paid to the personal
representative of the Specified Employee’s estate within sixty (60) days after
the date of his or her death.

Section 5.03 Limitation on Benefits.

(a) Notwithstanding anything set forth in the Plan to the contrary, if any
payment or benefit, including the Severance Benefits, a Participant would
receive from the Employer pursuant to a Change in Control or otherwise
(“Payment”) would (i) constitute a “parachute payment” within the meaning of
section 280G of the Code and (ii) but for this sentence, be subject to the
excise tax imposed by section 4999 of the Code (the “Excise Tax”),

 

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then such Payment shall be reduced to the Reduced Amount. The “Reduced Amount”
shall be either (x) the largest portion of the Payment that would result in no
portion of the Payment being subject to the Excise Tax or (y) the largest
portion, up to and including the total, of the Payment, whichever amount, after
taking into account all applicable federal, state and local employment taxes,
income taxes, and the Excise Tax (all computed at the highest applicable
marginal rate), results in the Participant’s receipt, on an after-tax basis, of
the greater amount of the Payment notwithstanding that all or some portion of
the Payment may be subject to the Excise Tax. If a reduction in payments or
benefits (or a cancellation of the acceleration of vesting of stock options or
equity awards) constituting “parachute payments” is necessary so that the
Payment equals the Reduced Amount, such reduction and/or cancellation of
acceleration shall occur in the order that provides the maximum economic benefit
to the Participant. In the event that acceleration of vesting of a stock option
or equity award is to be reduced, such acceleration of vesting also shall be
canceled in the order that provides the maximum economic benefit to the
Participant.

(b) The Company shall appoint a nationally recognized accounting firm with
appropriate subject matter expertise to make the determinations required under
this Section 5.03.

(c) The Company shall bear all expenses with respect to the making of the
determinations by such accounting firm required to be made under this
Section 5.03. The accounting firm engaged to make the determinations under this
Section 5.03 shall provide its calculations, together with detailed supporting
documentation, to the Company and the Participant as soon as practicable after
the date on which the Participant’s right to a Payment is triggered (if
requested at that time by the Company or the Participant) or such other time as
requested by the Company or the Participant. If the accounting firm determines
that no Excise Tax is payable with respect to a Payment, either before or after
the application of the Reduced Amount, it shall furnish the Company with an
opinion reasonably acceptable to the Participant that no Excise Tax will be
imposed with respect to such Payment. Any good faith determinations of the
accounting firm made under this Section 5.03 shall be final, binding, and
conclusive upon the Company and the Participant.

ARTICLE VI

RESTRICTIVE COVENANTS

Section 6.01 Principles of Business Conduct. Each Eligible Employee shall adhere
in all respects to the Employer’s Principles of Business Conduct (or any
successor code of conduct) as they may from time to time be established,
interpreted, amended or terminated.

Section 6.02 Proprietary Information.

(a) Each Eligible Employee shall acknowledge that, during the course of his or
her employment, the Eligible Employee has learned or will learn or develop
Proprietary Information. Each Eligible Employee shall further acknowledge that
unauthorized disclosure or use of such Proprietary Information, other than in
discharge of the Eligible Employee’s duties, will cause the Employer irreparable
harm. Except in the course of his or her employment with the Employer, in
pursuit of the business of the Employer, or as otherwise required in employment
with the Employer or by applicable law, each Eligible Employee shall not, during

 

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the course of his or her employment or at any time following termination of his
or her employment, directly or indirectly, disclose, publish, communicate, or
use on his or her behalf or another’s behalf, any Proprietary Information. If
during or after his or her employment, the Eligible Employee has any questions
about whether particular information is Proprietary Information, the Eligible
Employee shall consult with the Company’s General Counsel or other
representative designated by the Company.

(b) Each Eligible Employee shall also agree to promptly disclose to the Employer
any information, ideas, or inventions made or conceived by him or her that
results from or are suggested by services performed by the Eligible Employee for
the Employer, and to assign to the Employer all rights pertaining to such
information, ideas, or inventions. Knowledge or information of any kind
disclosed by the Eligible Employee to the Employer shall be deemed to have been
disclosed without obligation on the part of the Employer to hold the same in
confidence, and the Employer shall have the full right to use and disclose such
knowledge and information without compensation to the Eligible Employee.

Section 6.03 Non-Competition.

(a) During the Eligible Employee’s employment with the Employer and during the
Non-Compete Period, each Eligible Employee shall agree that he or she shall not
engage in Competitive Employment.

(b) If an Eligible Employee ceases to be employed by the Employer because of the
sale, spin-off, divestiture, or other disposition by the Company of a
Subsidiary, division, or other divested unit employing the Eligible Employee,
this provision shall continue to apply during the Non-Compete Period, except
that the Eligible Employee’s continued employment for the Subsidiary, division,
or other divested unit disposed of by the Company shall not be deemed a
violation of this provision.

(c) A Participant’s Non-Compete Period shall equal his or her Severance Period
as determined under Section 4.01 or 4.02 above, as applicable.

Section 6.04 Inducement of Employees, Customers and Others. During an Eligible
Employee’s employment with the Employer and during the Non-Compete Period, each
Eligible Employee shall agree that he or she will not, directly or indirectly,
solicit, induce, or encourage any employee, consultant, agent or customer of the
Company or its Subsidiaries or vendors or other parties doing business with the
Company or its Subsidiaries, to terminate their employment, agency, or other
relationship with the Company or its Subsidiaries or to render services for or
transfer business to any Competitor, and each Eligible Employee shall not
initiate discussion with any such person for any such purpose or authorize or
knowingly cooperate with the taking of any such actions by any other individual
or entity on behalf of the Competitor.

Section 6.05 No Adverse Actions. During the Non-Compete Period, each Eligible
Employee shall not, without the prior written consent of the Company, in any
manner, solicit, request, advise, or assist any other person to (a) undertake
any action that would be reasonably likely to, or is intended to, result in a
Change in Control, or (b) seek to control the Board, in any material manner.

 

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Section 6.06 Return of Property. Each Eligible Employee shall, upon the Eligible
Employee’s Termination Date, return to the Employer all property of the Employer
in the Eligible Employee’s possession, including all notes, reports, sketches,
plans, published memoranda, or other documents, whether in hard copy or in
electronic form, created, developed, generated, received, or held by the
Eligible Employee during the Eligible Employee’s employment, concerning or
related to the Employer’s business, whether or not containing or relating to
Proprietary Information. Each Eligible Employee shall not remove, by e-mail, by
removal of computer discs or hard drives, or by other means, any of the above
property containing Proprietary Information, or reproductions or copies thereof,
or any apparatus from the Employer’s premises without the Employer’s written
consent.

Section 6.07 Non-Disparagement. Each Eligible Employee shall agree to refrain
from making any statements about the Company, its Subsidiaries or their officers
or directors that would disparage, or reflect unfavorably upon the image or
reputation of the Company, its Subsidiaries or any such officer or director.

Section 6.08 Assistance with Claims.

(a) Each Eligible Employee shall agree, that, during and after the Eligible
Employee’s employment by the Employer, the Eligible Employee shall assist the
Company, on a reasonable basis, in the defense of any claims or potential claims
that may be made or threatened to be made against it in any action, suit, or
proceeding, whether civil, criminal, administrative, or investigative
(“Proceeding”) and shall assist the Company in the prosecution of any claims
that may be made by the Company in any Proceeding, to the extent that such
claims may relate to the Eligible Employee’s services.

(b) Each Eligible Employee shall agree, unless precluded by law, to promptly
inform the Company if the Eligible Employee is asked to participate (or
otherwise become involved) in any Proceeding involving such claims or potential
claims.

(c) Each Eligible Employee shall also agree, unless precluded by law, to
promptly inform the Company if the Eligible Employee is asked to assist in any
investigation (whether governmental or private) of the Company or its
Subsidiaries (or its actions), regardless of whether a lawsuit has then been
filed against the Company or its Subsidiaries with respect to such
investigation.

(d) The Company agrees to reimburse an Eligible Employee for all of the Eligible
Employee’s reasonable out-of-pocket expenses associated with such assistance,
including travel expenses and any attorneys’ fees and shall pay a reasonable per
diem fee (equal to 1/250th of the Eligible Employee’s Base Salary rate at the
Eligible Employee’s Termination Date) for the Eligible Employee’s services.

Section 6.09 Reasonableness. In the event that any of the provisions of this
Article VI should ever be adjudicated to exceed the time, geographic, service,
or other limitations permitted by applicable law in any jurisdiction, then such
provisions shall be deemed reformed in such jurisdiction to the maximum time,
geographic, service, or other limitations permitted by applicable law.

 

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Section 6.10 Equitable Relief.

(a) Each Eligible Employee shall acknowledge that the restrictions contained in
this Article VI are reasonable and necessary to protect the legitimate interests
of the Company, its Subsidiaries and its affiliates, that the Company would not
have established this Plan in the absence of such restrictions, and that any
violation of any provision of this Article VI will result in irreparable injury
to the Company. Each Eligible Employee shall represent that his or her
experience and capabilities are such that the restrictions contained in this
Article VI will not prevent the Eligible Employee from obtaining employment or
otherwise earning a living at the same general level of economic benefit as is
currently the case. Each Eligible Employee shall further represent and
acknowledge that (i) he or she has been advised by the Company to consult his or
her own legal counsel in respect of this Plan, and (ii) that he or she has had
full opportunity, prior to agreeing to participate in this Plan, to review
thoroughly this Plan with his or her counsel.

(b) Each Eligible Employee shall agree that the Company shall be entitled to
preliminary and permanent injunctive relief, without the necessity of proving
actual damages and without posting a bond or other security, as well as an
equitable accounting of all earnings, profits and other benefits arising from
any violation of this Article VI, which rights shall be cumulative and in
addition to any other rights or remedies to which the Company may be entitled.

(c) Each Eligible Employee shall irrevocably and unconditionally (i) agree that
any suit, action or other legal proceeding arising out of this Article VI,
including without limitation, any action commenced by the Company for
preliminary and permanent injunctive relief or other equitable relief, must be
brought, as appropriate, in the Kansas District Court located in Johnson County,
Kansas, or in the United States District Court for the District of Kansas in
Kansas City, Kansas, (ii) consent to the non-exclusive jurisdiction of any such
court in any such suit, action or proceeding, and (iii) waive any objection
which the Eligible Employee may have to the laying of venue of any such suit,
action or proceeding in any such court. Each Eligible Employee shall also
irrevocably and unconditionally consent to the service of any process,
pleadings, notices or other papers in a manner permitted by the notice
provisions of Section 10.04.

Section 6.11 Survival of Provisions. The obligations contained in this Article
VI shall survive the termination of each Eligible Employee’s employment with the
Employer and shall be fully enforceable thereafter.

ARTICLE VII

COMMITTEE; PLAN ADMINISTRATOR

Section 7.01 Authority and Duties. Except with respect to such duties as are
specifically allocated to the Committee under the Plan, it shall be the duty of
the Plan Administrator, on the basis of information supplied to the Plan
Administrator by the Company and the Committee, to properly administer the Plan.
The Plan Administrator shall have the full power, authority and discretion to
construe, interpret and administer the Plan, to make factual

 

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determinations, to correct deficiencies therein, and to supply omissions. The
Plan Administrator may adopt such rules and regulations and may make such
decisions as it deems necessary or desirable for the proper administration of
the Plan.

Section 7.02 Compensation of the Plan Administrator and the Committee. The Plan
Administrator and the Committee shall receive no compensation for services as
such. However, all reasonable expenses of the Plan Administrator and the
Committee shall be paid or reimbursed by the Company upon proper documentation.
The Plan Administrator and the Committee shall be indemnified by the Company
against personal liability for actions taken in good faith in the discharge of
the Plan Administrator’s or the Committee’s duties, as applicable.

Section 7.03 Records, Reporting and Disclosure. The Plan Administrator shall
keep a copy of all records relating to the payment of Severance Benefits to
Participants and former Participants and all other records necessary for the
proper operation of the Plan. All Plan records shall be made available to the
Committee, the Company and to each Participant for examination during business
hours except that a Participant shall examine only such records as pertain
exclusively to the examining Participant and to the Plan. The Plan Administrator
shall prepare and shall file as required by law or regulation all reports,
forms, documents and other items required by ERISA, the Code, and every other
relevant statute, each as amended, and all regulations thereunder (except that
the Employer, as payor of the Severance Benefits, shall prepare and distribute
to the proper recipients all forms relating to withholding of income or wage
taxes, Social Security taxes, and other amounts that may be similarly
reportable).

Section 7.04 Discretion. Any decisions, actions or interpretations to be made
under the Plan by the Board, the Committee, or the Plan Administrator (acting on
its own behalf or on behalf of the Board or the Committee) shall be made in each
of their respective sole and absolute discretion, not in any fiduciary capacity
(except with respect to the Plan Administrator acting on its own behalf) and
need not be uniformly applied to similarly situated individuals and such
decisions, actions or interpretations shall be final, binding and conclusive
upon all parties, subject only to determinations by the Named Appeals Fiduciary
(as defined in Section 9.04), with respect to denied claims for Severance
Benefits.

ARTICLE VIII

AMENDMENT, SUSPENSION AND TERMINATION

Section 8.01 Amendment, Suspension and Termination.

(a) In General. Except as otherwise provided in this Article VIII, the Board or
its delegate shall have the right, at any time and from time to time, to amend,
suspend or terminate the Plan in whole or in part, for any reason or without
reason, and without either the consent of or the prior notification to any
Participant or Eligible Employee. In the event of any amendment, suspension or
termination that has a material adverse effect on an Eligible Employee’s
benefits and/or rights under the Plan and that occurs more than 12 months before
or more than 12 months after the occurrence of a Change in Control, the
Non-Compete Period applicable to that Eligible Employee will apply only for the
period of time for which Severance Benefits under the Plan are actually payable.

 

19

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(b) In Event of a Change in Control. Any amendment, suspension or termination
that adversely affects an Eligible Employee’s benefits and/or rights under the
Plan shall not apply to an Eligible Employee covered under the Plan at the time
of a Change in Control if the amendment, suspension or termination is made
within 12 months before or after such Change in Control without the Eligible
Employee’s written consent (and before all payments and benefits hereunder
associated with such Change in Control are paid), except as may be otherwise
required to comply with changes in applicable laws or regulations, including as
set forth in Section 10.13.

(c) No Recovery of Benefits. No amendment, suspension or termination shall give
the Company the right to recover any amount paid to a Participant prior to the
date of the amendment, suspension or termination (except as provided in
Section 3.02(b)) or to cause the cessation of Severance Benefits after a
Participant has executed a Release as required under Section 3.02.

Section 8.02 Continuation of Plan following a Change in Control. Notwithstanding
Section 8.01(a) but subject to Section 8.01(b), upon the occurrence of a Change
in Control, the Plan shall continue until the applicable Employer has fully
performed all of such Employer’s obligations under the Plan with respect to all
Participants and Eligible Employees covered under the Plan at the time of the
Change in Control, and shall have paid in full all Severance Benefits under the
Plan associated with such Change in Control.

ARTICLE IX

CLAIMS PROCEDURES

Section 9.01 Claims. A Participant or his or her beneficiary, as applicable (the
“claimant”) may contest only the administration of the Severance Benefits
awarded by completing and filing with the Plan Administrator a written request
for review in the manner specified by the Plan Administrator within 90 days
following the Participant’s termination of employment. Each such application
must be supported by such information as the Plan Administrator deems relevant
and appropriate. No appeal is permissible as to a Participant’s eligibility for
or amount of the Severance Benefit, which are decisions made within the
discretion of the Company, and the Committee and the Plan Administrator acting
on behalf of the Company. The claimant may not bring an action for any alleged
wrongful denial of Plan benefits in a court of law unless the claims procedures
described in this Article IX are exhausted and a final determination is made by
the Plan Administrator and/or the Named Appeals Fiduciary. If the claimant
challenges a decision by the Plan Administrator and/or Named Appeals Fiduciary,
a review by the court of law will be limited to the facts, evidence and issues
presented to the Plan Administrator during the claims procedure set forth in
this Article IX. Facts and evidence that become known to the claimant after such
individual has exhausted the claims procedure must be brought to the attention
of the Plan Administrator and/or Named Appeals Fiduciary for reconsideration.
Issues not raised with the Plan Administrator and/or Named Appeals Fiduciary
will be deemed waived.

Section 9.02 Initial Claim. In the event that any claim relating to the
administration of Severance Benefits is denied in whole or in part, the claimant
whose claim has been so denied shall be notified of such denial in writing by
the Plan Administrator within 90 days after the

 

20

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receipt of the claim for benefits. This period may be extended an additional 90
days if the Plan Administrator determines such extension is necessary and the
Plan Administrator provides notice of the extension to the claimant prior to the
end of the initial 90-day period. The notice advising of the denial shall:
(i) specify the reason or reasons for denial, (ii) make specific reference to
the Plan provisions on which the determination was based, (iii) describe any
additional material or information necessary for the claimant to perfect the
claim (explaining why such material or information is needed), and (iv) describe
the Plan’s review procedures and the time limits applicable to such procedures,
including a statement of the claimant’s right to bring a civil action under
section 502(a) of ERISA following an adverse benefit determination on review.

Section 9.03 Appeals of Denied Administrative Claims. All appeals shall be made
by the following procedure:

(a) A claimant whose claim has been denied shall file with the Plan
Administrator a notice of appeal of the denial. Such notice shall be filed
within 60 calendar days of notification by the Plan Administrator of the denial
of a claim, shall be made in writing, and shall set forth all of the facts upon
which the appeal is based. Appeals not timely filed shall be barred.

(b) The Named Appeals Fiduciary shall consider the merits of the claimant’s
written presentations, the merits of any facts or evidence in support of the
denial of benefits, and such other facts and circumstances as the Named Appeals
Fiduciary shall deem relevant.

(c) The Named Appeals Fiduciary shall render a determination upon the appealed
claim which determination shall be accompanied by a written statement as to the
reasons therefor. The determination shall be made to the claimant within 60 days
of the claimant’s request for review, unless the Named Appeals Fiduciary
determines that special circumstances require an extension of time for
processing the claim. In such case, the Named Appeals Fiduciary shall notify the
claimant of the need for an extension of time to render its decision prior to
the end of the initial 60-day period, and the Named Appeals Fiduciary shall have
an additional 60-day period to make its determination. The determination so
rendered shall be binding upon all parties. If the determination is adverse to
the claimant, the notice shall: (i) provide the reason or reasons for denial,
(ii) make specific reference to the Plan provisions on which the determination
was based, (iii) state that the claimant is entitled to receive, upon request
and free of charge, reasonable access to, and copies of, all documents, records
and other information relevant to a the claimant’s claim for benefits, and
(iv) state that the claimant has the right to bring an action under section
502(a) of ERISA.

Section 9.04 Appointment of the Named Appeals Fiduciary. The Named Appeals
Fiduciary shall be the person or persons named as such by the Committee, or, if
no such person or persons is so named, then the person or persons named by the
Plan Administrator as the Named Appeals Fiduciary. Named Appeals Fiduciaries may
at any time be removed by the Committee, and any Named Appeals Fiduciary named
by the Plan Administrator may be removed by the Plan Administrator. All such
removals may be with or without cause and shall be effective on the date stated
in the notice of removal. The Named Appeals Fiduciary shall be a “Named
Fiduciary” within the meaning of ERISA, and unless appointed to other fiduciary
responsibilities, shall have no authority, responsibility, or liability with
respect to any matter other than the proper discharge of the functions of the
Named Appeals Fiduciary as set forth herein.

 

21

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ARTICLE X

MISCELLANEOUS

Section 10.01 Waiver of Jury Trial.

(a) The Employer waives and each Eligible Employee upon becoming a Participant
in the Plan shall waive his, her or its right to a jury trial in any court
action arising under the Plan or otherwise and whether made by claim,
counter-claim, third-party claim or otherwise.

(b) If for any reason the jury waiver is held to be unenforceable, but only in
that event, the Participant and the Employer agree to binding arbitration for
any dispute arising out of this Plan or any claim arising under any federal,
state or local statutes, laws or regulations, pursuant to the arbitration terms
set forth on attached Exhibit C.

(c) The agreement of the Participant to waive his or her right to a jury trial
will be binding on his or her beneficiaries or assigns and will survive the
termination of this Plan.

Section 10.02 Forum Selection. Any court proceeding brought by a Participant or
the Employer must be brought, as appropriate, in Kansas District Court located
in Johnson County, Kansas, or in the United States District Court for the
District of Kansas in Kansas City, Kansas. Each party agrees to personal
jurisdiction in either court.

Section 10.03 Nonalienation of Benefits. None of the payments, benefits or
rights of any Participant shall be subject to any claim of any creditor of any
Participant, and, in particular, to the fullest extent permitted by law, all
such payments, benefits and rights shall be free from attachment, garnishment
(if permitted under applicable law), trustee’s process, or any other legal or
equitable process available to any creditor of such Participant. No Participant
shall have the right to alienate, anticipate, commute, plead, encumber or assign
any of the benefits or payments that he may expect to receive, continently or
otherwise, under this Plan, except for the designation of a beneficiary.

Section 10.04 Notices. All notices and other communications required hereunder
shall be in writing and shall be delivered personally or mailed by registered or
certified mail, return receipt requested, or by overnight express courier
service. In the case of the Participant, mailed notices shall be addressed to
him or her at the home address which he or she most recently communicated to the
Company in writing. In the case of the Company, mailed notices shall be
addressed to the Plan Administrator.

Section 10.05 No Mitigation. Participants shall not be required to mitigate the
amount of any Severance Benefit provided for in this Plan by seeking other
employment or otherwise, nor shall the amount of any Severance Benefit provided
for herein be reduced by any compensation earned by other employment or
otherwise, except if the Participant is re-employed by the Employer, in which
case Severance Benefits shall cease.

 

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Section 10.06 No Contract of Employment. Neither the establishment of the Plan,
nor any modification thereof, nor the creation of any fund, trust or account,
nor the payment of any benefits shall be construed as giving any Eligible
Employee or any person whosoever, the right to be retained in the service of the
Employer, and all Eligible Employees shall remain subject to discharge to the
same extent as if the Plan had never been adopted.

Section 10.07 Severability of Provisions. Except to the extent provided in
Section 6.09, if any provision of this Plan shall be held invalid or
unenforceable by a court of competent jurisdiction, such invalidity or
unenforceability shall not affect any other provisions hereof, and this Plan
shall be construed and enforced as if such provisions had not been included.

Section 10.08 Headings and Captions. The headings and captions herein are
provided for reference and convenience only, shall not be considered part of the
Plan, and shall not be employed in the construction of the Plan.

Section 10.09 Gender and Number. Where the context admits: words in any gender
shall include any other gender, and, except where otherwise clearly indicated by
context, the singular shall include the plural, and vice-versa.

Section 10.10 Unfunded Plan. The Plan shall not be funded. No Participant shall
have any right to, or interest in, any assets of the Employer that may be
applied by the Employer to the payment of Severance Benefits. Payments of
Severance Benefits under the Plan shall be paid from the Employer’s general
assets, in accordance with the terms of the Plan.

Section 10.11 Payments to Incompetent Persons. Any benefit payable to or for the
benefit of a minor, an incompetent person or other person incapable of
receipting therefor shall be deemed paid when paid to such person’s guardian or
to the party providing or reasonably appearing to provide for the care of such
person, and such payment shall fully discharge the Employer, the Committee and
all other parties with respect thereto.

Section 10.12 Lost Payees. A benefit shall be deemed forfeited if the Committee
is unable to locate a Participant to whom a Severance Benefit is due. Such
Severance Benefit shall be reinstated if application is made by the Participant
for the forfeited Severance Benefit while this Plan is in operation.

Section 10.13 Section 409A Compliance. This Plan shall be interpreted to avoid
any penalty sanctions under section 409A of the Internal Revenue Code of 1986,
as amended (the “Code”). If any payment or benefit cannot be provided or made at
the time specified herein without incurring sanctions under section 409A, then
such benefit or payment shall be provided in full at the earliest time
thereafter when such sanctions will not be imposed. All payments to be made upon
termination of employment under this Plan may only be made upon a “separation
from service” under section 409A of the Code. For purposes of section 409A of
the Code, each payment made under this Plan shall be treated as a separate
payment. In addition, the right to a series of installment payments under this
Plan is to be treated as a right to a series of separate payments. All
reimbursements and in kind benefits provided under this Plan shall be made or
provided in accordance with the requirements of section 409A, including, where
applicable, the requirement that (i) any reimbursement is for expenses incurred
during your lifetime (or during a shorter period of time specified in this
Plan), (ii) the amount of expenses eligible for

 

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reimbursement, or in kind benefits provided, during a calendar year may not
affect the expenses eligible for reimbursement, or in kind benefits to be
provided, in any other calendar year, (iii) the reimbursement of an eligible
expense will be made on or before the last day of the calendar year following
the year in which the expense is incurred, and (iv) the right to reimbursement
or in kind benefits is not subject to liquidation or exchange for another
benefit. In no event may a Participant, directly or indirectly, designate the
calendar year of payment.

Section 10.14 Controlling Law. This Plan shall be construed and enforced
according to the laws of the State of Kansas to the extent not superseded by
Federal law.

 

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EXHIBIT A

Participation Agreement

THIS PARTICIPATION AGREEMENT (this “Agreement”) is made and entered into as of
                 , 2007 by and between                      (the “Employee”) and
Embarq Corporation, a Delaware corporation (the “Company”), on behalf of itself
and its subsidiary which employs the Employee.

The Employee is eligible to participate in the Embarq Corporation Executive
Severance Plan (the “Plan”). The Employee accepts participation in the Plan and,
intending to be legally bound, agrees as follows:

1. Participation in the Plan; Termination of any other Rights to Severance
Benefits. Pursuant to the terms of the Plan, I agree to forego any other
benefits or payments to which I may otherwise be entitled under the terms of any
other plan, program or agreement of the Company which provides for the payment
of severance benefits in the event of my termination of employment whether in
connection with a change in control of the Company or otherwise[, including any
rights I may have under my employment agreement with the Company, dated
                     (the “Employment Agreement”). I understand and agree that
by executing this Agreement, the Employment Agreement shall be null and void and
of no further effect as of the date hereof].

2. Employee’s Undertakings. I agree to be bound by all of the restrictive
covenants set forth in Article VI of the Plan and accept the reasonableness of
the equitable relief provisions set forth in Sections 6.09 and 6.10 of the Plan.

This Agreement has been duly executed as of the day and year first written
above.

EMBARQ CORPORATION

 

By:   

 

     Title:  

 

 

I hereby acknowledge that I have had the opportunity to review and consider the
Plan and the restrictive covenants set forth in Article VI of the Plan. I hereby
accept my right to receive potential Severance Benefits described in this
Agreement and the Plan and agree to be bound by the terms of the Plan and this
Agreement including the restrictive covenants set forth in Article VI of the
Plan. I hereby further agree that all the decisions and determinations of the
Committee and/or Plan Administrator, as applicable, shall be final and binding.

 

 

  Employee  

 

A

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EXHIBIT B

Form of Release Agreement

[NOTE: The terms and conditions of this Form of Release Agreement may be
modified by the Company at the advice of counsel to satisfy applicable legal
requirements.]

 

Employee Name:

    

 

         

Work City, State:

     Overland Park, Kansas          

Notice to Employee: You should discuss this General Release Agreement with an
attorney prior to signing it but, in any event, you should thoroughly review and
understand the effect of this document before acting upon it. Therefore, please
take this General Release Agreement home and carefully consider it before you
decide whether to sign it. You have up to 45 calendar days from the date of
receipt of this General Release Agreement in which to decide whether to sign it.

GENERAL RELEASE AGREEMENT

THIS GENERAL RELEASE AGREEMENT is entered into this          day of         ,
200    , by and between <insert company name> (hereafter referred to as
“EMBARQ”) and                      (hereafter referred to as “Employee” or
“you”).

1. If you sign and return the original of this General Release Agreement, and do
not revoke it, EMBARQ will provide you Separation Pay and certain benefits for
an extended period, in accordance with the terms of the Executive Severance Plan
( the “Plan”).

Separation Pay and Benefits

A. At the time EMBARQ makes its final bi-weekly payment to you under paragraph B
below, EMBARQ also will pay you a cash payment equal to 80% of your target short
term incentive (STI) opportunity for <insert fiscal year in which termination
occurs>, pro-rated based on the length of your separation pay period, less
required payroll deductions.

B. EMBARQ will provide you with your full base salary (less appropriate payroll
deductions and withholdings) at your current salary, for the <insert number of
weeks based on Section 4.01(a) or 4.02(a) calculation> week period beginning
immediately after your last day worked and continuing through <Date> (the
“Separation Period”), which will be payable on a bi-weekly basis in accordance
with EMBARQ’s normal pay cycle. These salary payments, however, will not begin
to be made until one pay cycle following seven (7) days after EMBARQ’s receipt
of the signed original of this Agreement and, in any event, at least one pay
cycle after your last day worked.

 

1

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C. In addition, you and your dependents will continue to be eligible through
<Date> for benefits as described in the Separation Benefit Summary and subject
to the terms of the applicable plans.

D. This Agreement does not in any way modify, expand, limit or abrogate rights
or benefits under any equity incentive plan, equity compensation plan. equity
grant agreement with you, or any other employee health, welfare or benefit plan.
Your rights, if any, to continued vesting of equity awards are subject to the
terms and conditions of the applicable plans and award agreements.

2. General Release. In consideration for the separation pay and benefits
described in paragraph 1 that EMBARQ has agreed to provide, you release and
forever discharge EMBARQ and its parents, subsidiaries, affiliates,
predecessors, and successors, as well as the Board of Directors of each
(collectively the “related entities”), as well as their officers, agents,
directors, employees, trustees and benefit plans from any and all liability,
actions, and claims, known or unknown, fixed or contingent, that you now have or
may claim to have against EMBARQ or the related entities, including any claims
arising out of your employment relationship with EMBARQ or the related entities;
the termination of that relationship; the conversion, grant, issuance or award
of any equity, including stock options and restricted shares; or your status as
a shareholder, officer or member of a Board of Directors of any related entity,.
This release includes claims arising under federal, state, or local laws
prohibiting employment discrimination or claims growing out of any legal
restrictions on EMBARQ’s right to terminate its employees, including but not
limited to claims arising under Title VII of the Civil Rights Act of 1964 (as
amended), 42 U.S.C. § 1981, the Age Discrimination in Employment Act (“ADEA”),
the Older Worker’s Benefit Protection Act (“OWBPA”), the Employee Retirement
Income Security Act (“ERISA”), the Family and Medical Leave Act, the Equal Pay
Act, any securities law or regulation, state laws against discrimination or
state human rights acts, claims of wrongful discharge, claims of breach of
express or implied contract, or claims under any tort or common law, including
claims for attorneys’ fees. This Release does not govern claims that cannot be
released by private agreement and any claims or rights that may arise after the
date on which this General Release Agreement became effective. Also excluded
from this General Release Agreement is your right to file a charge with an
administrative agency or participate in an agency investigation. You are,
however, waiving all rights to recover money in connection with any such charge,
investigation or related lawsuit.

Solely in clarification of the above paragraph, any obligations of EMBARQ or any
insurer to indemnify you, or to advance to you expenses before a judicial or
administrative determination that you are entitled to indemnification, such
obligations being memorialized or otherwise provided for in the Articles of
Incorporation or Bylaws of Embarq, or in a separate written agreement, are not
covered by the release in the above paragraph and will continue to remain
obligations of such persons.

3. Forfeiture due to Violation of Restrictive Covenants. You understand and
agree that , unless otherwise required by law, EMBARQ will cease and
discontinue, effective as of the

 

2

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date of your violation of any restrictive covenant in Article VI of the
Executive Severance Plan, any separation pay and benefits that otherwise would
become due to you after the date of such violation. By way of illustration and
not limitation, if you make an unauthorized disclosure of proprietary
information or if you engage in Competitive Employment, you will forfeit any
remaining separation pay or benefits otherwise due to you during the remainder
of the Separation Period. For purposes of emphasis and as a reminder, this
paragraph of the Agreement sets forth obligations already imposed on you by the
Executive Severance Plan (by virtue of your execution of the Participation
Agreement) and the Intellectual Property Rights (IPR) Agreement. As noted in the
Executive Severance Plan and IPR Agreement, your obligations under those
agreements survive the termination of your employment. This Agreement does not
supersede the IPR Agreement or Article VI of the Executive Severance Plan.

Forfeiture under this paragraph is in addition to and not in place of EMBARQ’s
other remedies at law or in equity for violation of any of your restrictive
covenants.

The terms “competitor” and “competitive employment” in this Agreement shall have
the same meaning as those same terms have in the Executive Severance Plan.

4. Signing and Returning this Agreement. You may not sign this Agreement before
your last day of work. If you wish to accept this Agreement, you must send it to
EMBARQ at the following address:

 

EMBARQ Address:                <insert ER Rep Address>             City, State:
       <insert ER Rep City, State>                  Mailstop:   
            <insert Mailstop>     Attn:                <insert ER Rep
Name>            

5. Other Separation Plans and Agreements. You acknowledge and agree that the
payments and benefits you receive under this Agreement pursuant to the Executive
Severance Plan replace any rights to severance pay you may have or may have had
under any other separation pay plan or contract, and that you will seek no
compensation or benefits from EMBARQ under any other such plan or contract.

6. Choice of Law, Choice of Venue, Jury Trial and Class Action Waiver. You
acknowledge and agree that this General Release Agreement shall be governed by
and is to be interpreted according to the laws of the State of Kansas. You and
EMBARQ agree that any and all disputes regarding this Agreement shall be
resolved by arbitration in the Kansas City, Missouri metropolitan area in
accordance with Exhibit C to the Executive Severance Plan. Any challenge to
arbitrability or to an arbitration award shall be made in the Kansas State
Courts in Johnson County, Kansas, or in the Federal District Court for Kansas,
and you consent to the jurisdiction of such courts. You expressly waive and
relinquish the right to a trial before a jury in any action, brought in any
court, concerning this General Release

 

3

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Agreement or any other claim against EMBARQ. You also expressly waive the right
to participate in, collect damages in, opt in or serve as a representative in
any class or collective action against EMBARQ.

7. Litigation Costs. In any action relating to rights or obligations under this
Agreement, each party shall pay its own costs (including filing fees), expenses
and attorney’s fees, and the parties shall split the arbitration fees equally.
Excluded from this paragraph 7 is your right to challenge in good faith under
the ADEA or the OWBPA the validity of this General Release Agreement.

8. Acknowledgements. You acknowledge and agree that:

 

  a. the separation pay and benefits described in paragraph 1 of this General
Release Agreement are in addition to whatever you would or may be entitled to
receive if you did not sign this Agreement;

 

  b. Exhibit B, attached to this General Release Agreement and provided to you,
lists: the class, unit or group of individuals covered by this exit incentive
program or employment termination program; the eligibility factors for the
program; any time limits applicable to the program; the job titles and ages of
all individuals eligible or selected for the program; and the ages of all
individuals in the same job classification or organizational unit who were not
eligible or selected for the program.

9. No Admission. You acknowledge and agree that this General Release Agreement
will not be construed as an admission by EMBARQ of any wrongdoing or any
violation of federal, state or local, regulation or ordinance and EMBARQ
disclaims any wrongdoing against you.

10. Severability. You acknowledge and agree that if any provision of this
General Release Agreement is declared illegal or unenforceable, such provision
shall immediately become null and void, leaving the remainder of the General
Release Agreement in full force and effect.

11. Assignability. EMBARQ may assign its rights, liabilities and obligations
under this Agreement to any subsidiary, affiliated or related entity, without
notice or consent. In that event, this General Release Agreement shall bind and
inure to the benefit of any assignee of or any successor to EMBARQ.

12. Entire Agreement. You agree that EMBARQ has not promised you anything to
induce you to enter into this Agreement other than as specifically stated in
this Agreement. EMBARQ does not have any implied obligations under this
Agreement.

13. WARN. If EMBARQ paid you any payments under WARN, in addition to salary
separation payments under EMBARQ’s Executive Severance Plan, you agree and
acknowledge that: (1) the method used to determine your rate of pay is
reasonable and fairly compensates you for the sixty day WARN Act period; (2) the
EMBARQ Executive

 

4

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Severance Plan permits EMBARQ to deduct WARN Act payments from your separation
pay, if applicable; and the separation pay is a voluntary and unconditional
payment from EMBARQ that EMBARQ is not legally obliged to provide unless you
sign this General Release Agreement.

14. `Revocation. You have the right to revoke this General Release Agreement by
written notice to EMBARQ, Attn: <insert ER Rep Name, ER Title> at <Insert
Address and Mailstop>, within 7 calendar days after you sign it and the General
Release Agreement will not become effective or enforceable until after 7
calendar days have passed.

Please acknowledge your acceptance of this General Release Agreement by signing
this letter on or after your last day of work and returning this letter. By
signing you are acknowledging that you have carefully read and fully understand
all of the provisions of this General Release Agreement (including the Notice to
Employee on page 1), and that it is the entire agreement between you and EMBARQ
relating to the matters herein, including your employment and the termination of
it, and you acknowledge that other than those statements in this document, you
have not relied upon any representation or statement, written or oral, in
entering into this Agreement. THIS GENERAL RELEASE AGREEMENT OBLIGATES YOU TO
ARBITRATE ALL DISPUTES RELATING TO IT OR ARISING UNDER IT.

 

<insert employee name in bold>    For <insert company name in bold> (For
Employee Use Only)    (For HR Use Only)

 

  

 

Employee Signature    Human Resource Signature

 

  

 

Employee Name (Printed or Typed)    Human Resource Title

 

  

 

Date of Signature    Date of Signature

 

5

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EXHIBIT C

Arbitration Provision

Any arbitration will be held in the Kansas City, Missouri metropolitan area (or
such other location as may be mutually agreed upon by the Employer and the
Participant) and be subject to the Governing Law provision of this Plan and in
accordance with the National Rules for the Resolution of Employment Disputes
then in effect of the American Arbitration Association, 9 U.S.C. § 1, et. seq,
before a panel of three arbitrators, two of whom shall be selected by the
Company and the Participant, respectively, and the third of whom shall be
selected by the other two arbitrators. Discovery in the arbitration will be
governed by the Local Rules applicable in the United States District Court for
the District of Kansas. Any award entered by the arbitrators shall be final,
binding and nonappealable and judgment may be entered thereon by either party in
accordance with applicable law in any court of competent jurisdiction. This
arbitration provision shall be specifically enforceable. The arbitrators shall
have no authority to modify any provision of this Plan or to award a remedy for
a dispute involving this Plan other than a benefit specifically provided under
or by virtue of the Plan. Each party shall be responsible for its own expenses
relating to the conduct of the arbitration (including reasonable attorneys’ fees
and expenses) and shall share the fees of the American Arbitration Association
and the arbitrators.

 

6