Document:

CAPITAL
SECURITIES GUARANTEE AGREEMENT  

BAC
Capital Trust XII 67⁄8% Capital Securities

Dated
as of August 2, 2006

ARTICLE 1

DEFINITIONS AND INTERPRETATION

SECTION 1.1...... Definitions and
Interpretation.............................................................................. 1

ARTICLE 2

TRUST INDENTURE ACT

SECTION 2.1...... Trust Indenture Act; Application......................................................................... 5

SECTION 2.2...... Lists of Holders of Securities.............................................................................. 5

SECTION 2.3...... Reports by the Capital Securities Guarantee
Trustee............................................ 5

SECTION 2.4...... Periodic Reports to Capital Securities
Guarantee Trustee.................................... 5

SECTION 2.5...... Evidence of Compliance with Conditions Precedent............................................ 5

SECTION 2.6...... Events of Default; Waiver................................................................................... 6

SECTION 2.7...... Event of Default; Notice..................................................................................... 6

SECTION 2.8...... Conflicting
Interests............................................................................................ 6

ARTICLE 3

POWERS, DUTIES AND RIGHTS OF CAPITAL SECURITIES GUARANTEE TRUSTEE

SECTION 3.1...... Powers and Duties of the Capital Securities Guarantee
Trustee............................ 6

SECTION 3.2...... Certain Rights of Capital Securities
Guarantee Trustee......................................... 8

SECTION 3.3...... Not Responsible
for Recitals or Issuance of Capital Securities Guarantee........... 10

ARTICLE 4

CAPITAL SECURITIES GUARANTEE TRUSTEE

SECTION 4.1...... Capital Securities Guarantee Trustee;
Eligibility.................................................. 10

SECTION 4.2...... Appointment,
Removal and Resignation of Capital Securities Guarantee Trustee 11

ARTICLE 5

GUARANTEE

SECTION 5.1...... Guarantee........................................................................................................ 12

SECTION 5.2...... Waiver of Notice and Demand......................................................................... 12

SECTION 5.3...... Obligations Not Affected.................................................................................. 12

SECTION 5.4...... Rights of Holders.............................................................................................. 13

SECTION 5.5...... Guarantee of Payment...................................................................................... 13

SECTION 5.6...... Subrogation...................................................................................................... 13

SECTION 5.7...... Independent
Obligations................................................................................... 14

ARTICLE 6

LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 6.1...... Limitation of Transactions................................................................................. 14

SECTION 6.2...... Ranking............................................................................................................ 14

ARTICLE 7

TERMINATION

SECTION 7.1...... Termination...................................................................................................... 15

ARTICLE 8

INDEMNIFICATION

SECTION 8.1...... Exculpation...................................................................................................... 15

SECTION 8.2...... Indemnification................................................................................................. 15

ARTICLE 9

MISCELLANEOUS

SECTION 9.1...... Successors and Assigns.................................................................................... 16

SECTION 9.2...... Amendments.................................................................................................... 16

SECTION 9.3...... Notices............................................................................................................ 16

SECTION 9.4...... Benefit............................................................................................................. 17

SECTION 9.5...... Governing Law................................................................................................. 17

CROSS-REFERENCE
TABLE*

Section of

            Trust Indenture Act                                                                   Section
of|

            of 1939,
as amended                                                                 Declaration

310(a)...............................................................................       4.1(a)

310(c)...............................................................................       Inapplicable

311(c)...............................................................................       Inapplicable

312(a)...............................................................................       2.2(a)

312(b)...............................................................................       2.2(b)

313...................................................................................       2.3

314(a)...............................................................................       2.4

314(b)...............................................................................       Inapplicable

314(c)...............................................................................       2.5

314(d)...............................................................................       Inapplicable

314(f)................................................................................       Inapplicable

315(a)...............................................................................       3.1(d)

315(c)...............................................................................       3.1(c)

315(d)...............................................................................       3.1(d)

_______________

*This Cross-Reference Table does not constitute part of the
Capital Securities Guarantee and shall not affect the interpretation of any of
its terms or provisions.

 

CAPITAL
SECURITIES GUARANTEE AGREEMENT

This GUARANTEE AGREEMENT (the
"Capital Securities Guarantee"), dated as of August 2, 2006, is executed and
delivered by BANK OF AMERICA CORPORATION, a Delaware corporation (the
"Guarantor"), and THE BANK OF NEW YORK, a New York banking corporation,
as trustee (the "Capital Securities Guarantee Trustee"), for the benefit of the
Holders (as defined herein) from time to time of the Capital Securities (as
defined herein) of BAC Capital Trust XII, a Delaware statutory trust (the
"Issuer").

WHEREAS, pursuant to an Amended
and Restated Declaration of Trust (the "Declaration"), dated as of July 26,
2006, among the trustees of the Issuer named therein, the Guarantor, as
sponsor, and the holders from time to time of undivided beneficial interests in
the assets of the Issuer, the Issuer is issuing on the date hereof 30,000,000
Capital Securities representing undivided preferred beneficial interests in the
assets of the Issuer, designated the BAC Capital Trust XII 67⁄8% Capital Securities (the "Capital
Securities"), initially in the aggregate liquidation amount of $750,000,000;
and

WHEREAS, pursuant to the terms
of an Underwriting Agreement dated as of July 26, 2006, by and among the
Guarantor, as sponsor, the Issuer and the Underwriters named therein (the
"Underwriting Agreement"), the Issuer has agreed to issue up to an additional 4,500,000
Capital Securities with an aggregate liquidation amount of up to $112,500,000
upon exercise of an option granted in the Underwriting Agreement to the
Underwriters (the "Option"); and

WHEREAS, as incentive for the
Holders to purchase the Capital Securities, the Guarantor desires irrevocably
and unconditionally to agree, to the extent set forth in this Capital
Securities Guarantee, to pay to the Holders of the Capital Securities the
Guarantee Payments (as defined herein) and to make certain other payments on
the terms and conditions set forth herein; and

WHEREAS, the Guarantor also is
executing and delivering a guarantee agreement (the "Common Securities
Guarantee") for the benefit of the holders of the Common Securities (as defined
herein);

NOW, THEREFORE, in
consideration of the purchase by each Holder of Capital Securities, which
purchase the Guarantor hereby agrees shall benefit the Guarantor, the Guarantor
executes and delivers this Capital Securities Guarantee for the benefit of the
Holders.

ARTICLE 1

DEFINITIONS AND INTERPRETATION

SECTION 1.1  
Definitions and Interpretation.  

In this Capital
Securities Guarantee, unless the context otherwise requires:

(a)        Capitalized
terms used in this Capital Securities Guarantee but not defined in the preamble
above have the respective meanings assigned to them in this Section 1.1;

 

(b)        terms
defined in the Declaration as at the date of execution of this Capital
Securities Guarantee have the same meaning when used in this Capital Securities
Guarantee;

(c)        a
term defined anywhere in this Capital Securities Guarantee has the same meaning
throughout;

(d)        all
references to "the Capital Securities Guarantee" or "this Capital Securities
Guarantee" are to this Capital Securities Guarantee as modified, supplemented
or amended from time to time;

(e)        all
references in this Capital Securities Guarantee to Articles and Sections are to
Articles and Sections of this Capital Securities Guarantee, unless otherwise
specified;

(f)         a
term defined in the Trust Indenture Act has the same meaning when used in this
Capital Securities Guarantee, unless otherwise defined in this Capital
Securities Guarantee or unless the context otherwise requires; and

(g)        a
reference to the singular includes the plural and vice versa.

"Affiliate" has the same meaning as given to that
term in Rule 405 of the Securities Act of 1933, as amended, or any successor
rule thereunder.

"Authorized Officer" means the Chief Executive
Officer, President, Chief Financial Officer, any Senior or other Vice
President, Treasurer, Assistant Treasurer, Associate General Counsel or other
Person authorized to bind a Person.

"Business Day" means any day other than a day on
which federal or state banking institutions in New York, New York or Charlotte,
North Carolina are authorized or obligated by law, executive order or
regulation to close.

"Capital Securities Guarantee Trustee" means The
Bank of New York, a New York banking corporation, until a Successor Capital
Securities Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Capital Securities Guarantee and
thereafter means each such Successor Capital Securities Guarantee Trustee.

"Capital Securities" means the total number of
BAC Capital Trust XII 67⁄8% Capital
Securities (liquidation amount $25 per Capital Security) issued pursuant to the
Declaration representing undivided preferred beneficial interests in the assets
of the Issuer, including any Capital Securities issued upon exercise of the
Option.

"Common Securities" means the securities
representing undivided common beneficial interests in the assets of the Issuer,
including any additional Common Securities issued in connection with the
exercise of the Option.

"Corporate Trust Office" means the office of the
Capital Securities Guarantee Trustee at which the corporate trust business of
the Capital Securities Guarantee Trustee shall, at

                                                                                     
2

 

 any particular time, be
principally administered, which office at the date of execution of this
Agreement is located at 101 Barclay Street, 8 West, New York, New York 10286.

"Covered Person" means any Holder or beneficial
owner of Capital Securities.

"Event of Default" means a default by the
Guarantor on any of its payments or other obligations under this Capital Securities
Guarantee.

"Guarantee Payments" means the following payments
or distributions, without duplication, with respect to the Capital Securities,
to the extent not paid or made by the Issuer:  (i) any accrued and unpaid
Distributions that are required to be paid on such Capital Securities to the
extent the Issuer shall have funds available therefor, (ii) the applicable
Redemption Price to the extent the Issuer has funds available therefor, with
respect to any Capital Securities called for redemption by the Issuer, and
(iii) upon a voluntary or involuntary dissolution, winding‐up or
termination of the Issuer (other than in connection with the distribution of
Notes to the Holders in exchange for Capital Securities as provided in the
Declaration), the lesser of (a) the aggregate of the liquidation amount and all
accrued and unpaid Distributions on the Capital Securities to the date of
payment, to the extent the Issuer shall have funds available therefor, and (b)
the amount of assets of the Issuer remaining available for distribution to
Holders in liquidation of the Issuer (in either case, the "Liquidation
Distribution").  If an Event of Default under, and as defined in, the Indenture
has occurred and is continuing, the rights of holders of the Common Securities to
receive payments under the Common Securities Guarantee are subordinated to the
rights of Holders of Capital Securities to receive Guarantee Payments under the
Capital Securities Guarantee.

"Holder" shall mean any holder, as registered on
the books and records of the Issuer, of any Capital Securities; provided,
however, that in determining whether the holders of the requisite
percentage of Capital Securities have given any request, notice, consent or
waiver hereunder, "Holder" shall not include the Guarantor or any Affiliate of
the Guarantor.

"Indemnified Person" means the Capital Securities
Guarantee Trustee, any Affiliate of the Capital Securities Guarantee Trustee,
or any officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Capital Securities
Guarantee Trustee.

"Indenture" means the Restated Indenture dated as
of November 1, 2001 between the Guarantor (the "Note Issuer") and The Bank of
New York, as trustee, together with any Board Resolution (as defined in the
Indenture) or any indenture supplemental thereto, pursuant to which certain
subordinated debt securities of the Note Issuer are to be issued to the
Property Trustee (as defined in the Declaration) of the Issuer.

"Majority in liquidation amount of the Securities"
means, except as provided by the Trust Indenture Act, a vote by Holder(s) of
Capital Securities, voting separately as a class, of more than 50% of the
liquidation amount (including the stated amount that would be paid on redemption,
liquidation, dissolution or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of all Capital
Securities.

                                                                                          
3

"Notes" means the series of junior subordinated
debt securities of the Guarantor designated the 67⁄8%
Junior Subordinated Notes, due 2055, held by the Property Trustee of the Issuer
on behalf of the Trust.

"Officers' Certificate" means, with respect to
any Person, a certificate signed by an Authorized Officer of such Person.  Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Capital Securities Guarantee shall include:

(a)  a statement that each officer signing
the Officers' Certificate has read the covenant or condition and the definition
relating thereto;

(b)        a brief statement of the nature
and scope of the examination or investigation undertaken by each officer in
rendering the Officers' Certificate;

(c)        a statement that each such
officer has made such examination or investigation as, in such officer's
opinion, is necessary to enable such officer to express an informed opinion as
to whether or not such covenant or condition has been complied with; and

(d)        a statement as to whether, in the
opinion of each such officer, such condition or covenant has been complied
with.

"Person" means a legal person, including any
individual, corporation, estate, partnership, joint venture, association, joint
stock company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.

"Responsible Officer" means, with respect to the
Capital Securities Guarantee Trustee, any officer within the Corporate Trust
Office of the Capital Securities Guarantee Trustee, including any vice
president, any assistant vice president, any assistant treasurer or other
officer of the Corporate Trust Office of the Capital Securities Guarantee
Trustee customarily performing functions similar to those performed by any of
the above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.

"Successor Capital Securities Guarantee Trustee"
means a successor Capital Securities Guarantee Trustee possessing the
qualifications to act as Capital Securities Guarantee Trustee under Section
4.1.

"Trust Indenture Act" means the Trust Indenture
Act of 1939, as amended.

"Trust Securities" means the Common Securities
and the Capital Securities.

                                                                                      
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ARTICLE 2

TRUST INDENTURE ACT

SECTION 2.1  
Trust Indenture Act; Application.  

(a)        This
Capital Securities Guarantee is subject to the provisions of the Trust
Indenture Act that are required to be part of this Capital Securities Guarantee
and shall, to the extent applicable, be governed by such provisions; and

(b)        If and to the
extent that any provision of this Capital Securities Guarantee limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317, inclusive,
of the Trust Indenture Act, such imposed duties shall control.

SECTION 2.2  
Lists of Holders of Securities.  

            (a)        The
Guarantor shall provide the Capital Securities Guarantee Trustee with a list,
in such form as the Capital Securities Guarantee Trustee may reasonably
require, of the names and addresses of the Holders of the Capital Securities
("List of Holders") as of such date, (i) within 10 days after each record date,
and (ii) at any other time within 30 days of receipt by the Guarantor of a
written request for a List of Holders as of a date no more than 10 days before
such List of Holders is given to the Capital Securities Guarantee Trustee; provided
that the Guarantor shall not be obligated to provide such List of
Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Capital Securities Guarantee Trustee by the
Guarantor.  The Capital Securities Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.

(b)        The
Capital Securities Guarantee Trustee shall comply with its obligations under
Sections 311(a), 311(b) and Section 312(b) of the Trust Indenture Act.

SECTION 2.3  
Reports by the Capital Securities Guarantee Trustee.  

Within 60 days after May 15 of each year, the Capital
Securities Guarantee Trustee shall provide to the Holders of the Capital
Securities such reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form and in the manner provided by Section 313 of the Trust
Indenture Act.  The Capital Securities Guarantee Trustee also shall comply with
the requirements of Section 313(d) of the Trust Indenture Act.

SECTION 2.4  
Periodic Reports to Capital Securities Guarantee Trustee.  

The Guarantor shall provide to the Capital Securities
Guarantee Trustee such documents, reports and information, if any, as required
by Section 314 and the compliance certificate required by Section 314 of the
Trust Indenture Act in the form, in the manner and at the times required by
Section 314 of the Trust Indenture Act.

SECTION 2.5  
Evidence of Compliance with Conditions Precedent.  

The Guarantor shall provide to the Capital Securities
Guarantee Trustee such evidence of compliance with any conditions precedent, if
any, provided for in this Capital

                                                                                      
5

 Securities Guarantee that relate to any of
the matters set forth in Section 314(c) of the Trust Indenture Act.  Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.

SECTION 2.6  
Events of Default; Waiver.  

The Holders of a Majority in liquidation amount of the
Securities may, by vote, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default and its consequences.  Upon such
waiver, any such Event of Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Capital Securities Guarantee, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.

SECTION 2.7  
Event of Default; Notice.  

(a)        The Capital
Securities Guarantee Trustee shall, within 90 days after the occurrence of an
Event of Default, transmit by mail, first class postage prepaid, to the Holders
of the Capital Securities, notices of all Events of Default actually known to a
Responsible Officer of the Capital Securities Guarantee Trustee, unless such
defaults have been cured before the giving of such notice, provided that
the Capital Securities Guarantee Trustee shall be protected in withholding such
notice if and so long as a Responsible Officer of the Capital Securities
Guarantee Trustee in good faith determines that the withholding of such notice
is in the interests of the Holders.

(b)        The Capital
Securities Guarantee Trustee shall not be deemed to have knowledge of any Event
of Default unless a Responsible Officer of the Capital Securities Guarantee
Trustee shall have received written notice thereof, or unless a Responsible
Officer of the Capital Securities Guarantee Trustee charged with the administration
of the Declaration shall have obtained actual knowledge thereof.

SECTION 2.8  
Conflicting Interests.  

The Declaration shall be deemed to be specifically
described in this Capital Securities Guarantee for the purposes of clause (i)
of the first proviso contained in Section 310(b) of the Trust Indenture Act.

ARTICLE 3

POWERS, DUTIES AND RIGHTS OF

CAPITAL SECURITIES GUARANTEE TRUSTEE

SECTION 3.1  
Powers and Duties of the Capital Securities Guarantee Trustee.  

(a)        This Capital
Securities Guarantee shall be held by the Capital Securities Guarantee Trustee
for the benefit of the Holders, and the Capital Securities Guarantee Trustee
shall not transfer this Capital Securities Guarantee to any Person except a
Holder of Capital Securities exercising his or her rights pursuant to Section 5.4(b)
or to a Successor Capital Securities Guarantee Trustee on acceptance by such
Successor Capital Securities Guarantee Trustee of its appointment to act as
Successor Capital Securities Guarantee Trustee.  The right,

                                                                                        
6

 title and interest
of the Capital Securities Guarantee Trustee shall automatically vest in any
Successor Capital Securities Guarantee Trustee, and such vesting and cessation
of title shall be effective whether or not conveyancing documents have been
executed and delivered pursuant to the appointment of such Successor Capital
Securities Guarantee Trustee.

(b)        If an Event of
Default actually known to a Responsible Officer of the Capital Securities
Guarantee Trustee has occurred and is continuing, the Capital Securities
Guarantee Trustee shall enforce this Capital Securities Guarantee for the
benefit of the Holders.

(c)        The Capital
Securities Guarantee Trustee, before the occurrence of any Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Capital Securities Guarantee, and no implied covenants shall be read into this
Capital Securities Guarantee against the Capital Securities Guarantee Trustee. 
In case an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.6) and is actually known to a Responsible Officer of the
Capital Securities Guarantee Trustee, the Capital Securities Guarantee Trustee
shall exercise such of the rights and powers vested in it by this Capital
Securities Guarantee, and use the same degree of care and skill in its exercise
thereof, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.

(d)        No provision of
this Capital Securities Guarantee shall be construed to relieve the Capital
Securities Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:

(i)         prior
to the occurrence of any Event of Default and after the curing or waiving of
all such Events of Default that may have occurred:

(A)       the
duties and obligations of the Capital Securities Guarantee Trustee shall be
determined solely by the express provisions of this Capital Securities
Guarantee, and the Capital Securities Guarantee Trustee shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Capital Securities Guarantee, and no implied covenants or
obligations shall be read into this Capital Securities Guarantee against the
Capital Securities Guarantee Trustee; and

(B)       in the
absence of bad faith on the part of the Capital Securities Guarantee Trustee,
the Capital Securities Guarantee Trustee may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed therein, upon
any certificates or opinions furnished to the Capital Securities Guarantee
Trustee and conforming to the requirements of this Capital Securities
Guarantee; but in the case of any such certificates or opinions that by any
provision hereof are specifically required to be furnished to the Capital
Securities Guarantee Trustee, the Capital Securities Guarantee Trustee shall be
under a duty to examine the same to determine whether or not they conform to
the requirements of this Capital Securities Guarantee;

                                                                              
7

(ii)        the
Capital Securities Guarantee Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Capital Securities
Guarantee Trustee, unless it shall be proved that the Capital Securities
Guarantee Trustee was negligent in ascertaining the pertinent facts upon which
such judgment was made;

(iii)       the
Capital Securities Guarantee Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of not less than a Majority in liquidation amount of
the Securities relating to the time, method and place of conducting any
proceeding for any remedy available to the Capital Securities Guarantee
Trustee, or exercising any trust or power conferred upon the Capital Securities
Guarantee Trustee under this Capital Securities Guarantee; and

(iv)       no
provision of this Capital Securities Guarantee shall require the Capital
Securities Guarantee Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if the Capital Securities Guarantee
Trustee shall have reasonable grounds for believing that the repayment of such
funds or liability is not reasonably assured to it under the terms of this
Capital Securities Guarantee or indemnity, reasonably satisfactory to the
Capital Securities Guarantee Trustee, against such risk or liability is not
reasonably assured to it.

SECTION 3.2  
Certain Rights of Capital Securities Guarantee Trustee.  

(a)        Subject to the
provisions of Section 3.1:

(i)         The
Capital Securities Guarantee Trustee may rely conclusively, and shall be fully
protected in acting or refraining from acting upon, any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to
have been signed, sent or presented by the proper party or parties.

(ii)        Any
direction or act of the Guarantor contemplated by this Capital Securities
Guarantee shall be sufficiently evidenced by an Officers' Certificate.

(iii)       Whenever,
in the administration of this Capital Securities Guarantee, the Capital
Securities Guarantee Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder, the
Capital Securities Guarantee Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on its part, request
and conclusively rely upon an Officers' Certificate which, upon receipt of such
request, shall be promptly delivered by the Guarantor.

(iv)       The
Capital Securities Guarantee Trustee shall have no duty to see to any
recording, filing or registration of any instrument (or any rerecording,
refiling or re-registration thereof).

 

                                                                         
8

(v)        The
Capital Securities Guarantee Trustee may consult with counsel of its selection,
and the advice or opinion of such counsel with respect to legal matters shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in accordance with
such advice or opinion.  Such counsel may be counsel to the Guarantor or any of
its Affiliates and may include any of its employees.  The Capital Securities
Guarantee Trustee shall have the right at any time to seek instructions
concerning the administration of this Capital Securities Guarantee from any
court of competent jurisdiction.

(vi)       The
Capital Securities Guarantee Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Capital Securities Guarantee
at the request or direction of any Holder, unless such Holder shall have
provided to the Capital Securities Guarantee Trustee such security and
indemnity, reasonably satisfactory to the Capital Securities Guarantee Trustee,
against the costs, expenses (including attorneys' fees and expenses and the
expenses of the Capital Securities Guarantee Trustee's agents, nominees or
custodians) and liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be requested by
the Capital Securities Guarantee Trustee; provided that, nothing contained in
this Section 3.2(a)(vi) shall be taken to relieve the Capital Securities
Guarantee Trustee, upon the occurrence of an Event of Default, of its
obligation to exercise the rights and powers vested in it by this Capital
Securities Guarantee.

(vii)      The
Capital Securities Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Capital Securities Guarantee Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may
see fit.

(viii)      The
Capital Securities Guarantee Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, nominees, custodians or attorneys, and the Capital Securities Guarantee
Trustee shall not be responsible for any misconduct or negligence on the part
of any agent or attorney appointed with due care by it hereunder.

(ix)       Any
action taken by the Capital Securities Guarantee Trustee or its agents
hereunder shall bind the Holders of the Capital Securities, and the signature
of the Capital Securities Guarantee Trustee or its agents alone shall be
sufficient and effective to perform any such action.  No third party shall be
required to inquire as to the authority of the Capital Securities Guarantee
Trustee to so act or as to its compliance with any of the terms and provisions
of this Capital Securities Guarantee, both of which shall be conclusively
evidenced by the Capital Securities Guarantee Trustee's or its agent's taking
such action.

(x)        Whenever
in the administration of this Capital Securities Guarantee the Capital
Securities Guarantee Trustee shall deem it desirable to receive instructions
with respect to enforcing any remedy or right or taking any other action hereunder,
the Capital

                                                                                  
9

 Securities Guarantee Trustee (i) may request instructions from the
Holders of a Majority in liquidation amount of the Securities, (ii) may refrain
from enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in conclusively relying
on or acting in accordance with such instructions.

(xi)       The
Capital Securities Guarantee Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably believed by
it to be authorized or within the discretion or rights or powers conferred upon
it by this Capital Securities Guarantee.

(b)        No provision of
this Capital Securities Guarantee shall be deemed to impose any duty or
obligation on the Capital Securities Guarantee Trustee to perform any act or
acts or exercise any right, power, duty or obligation conferred or imposed on
it in any jurisdiction in which it shall be illegal, or in which the Capital
Securities Guarantee Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts or to exercise any such
right, power, duty or obligation.  No permissive power or authority available
to the Capital Securities Guarantee Trustee shall be construed to be a duty.

SECTION 3.3  
Not Responsible for Recitals or Issuance of Capital Securities
Guarantee.  

The recitals contained in this Capital Securities
Guarantee shall be taken as the statements of the Guarantor, and the Capital
Securities Guarantee Trustee does not assume any responsibility for their
correctness.  The Capital Securities Guarantee Trustee makes no representation
as to the validity or sufficiency of this Capital Securities Guarantee.

ARTICLE 4

CAPITAL SECURITIES GUARANTEE TRUSTEE

SECTION 4.1  
Capital Securities Guarantee Trustee; Eligibility.  

(a)        There shall at all
times be a Capital Securities Guarantee Trustee which shall:

(i)         not
be an Affiliate of the Guarantor; and

(ii)        be a
corporation organized and doing business under the laws of the United States of
America or any State or Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Securities and Exchange Commission to
act as a trustee under the Trust Indenture Act, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, and subject to supervision or examination by Federal, State,
Territorial or District of Columbia authority.  If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the supervising or examining authority referred to above, then, for the
purposes of this Section 4.1(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published.

                                                                                      
10

(b)        If at any time the
Capital Securities Guarantee Trustee shall cease to be eligible to so act under
Section 4.1(a), the Capital Securities Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 4.2(c).

       (c)        If the Capital Securities Guarantee
Trustee has or shall acquire  any "conflicting interest" within the meaning of
Section 310(b) of the Trust Indenture Act, the Capital Securities Guarantee
Trustee and Guarantor shall in all respects comply with the provisions of
Section 310(b) of the Trust Indenture Act.

SECTION 4.2  
Appointment, Removal and Resignation of Capital Securities Guarantee
Trustee.  

(a)        Subject to Section
4.2(b), the Capital Securities Guarantee Trustee may be appointed or removed
without cause at any time by the Guarantor except during an Event
of Default.

(b)        The Capital
Securities Guarantee Trustee shall not be removed in accordance with Section
4.2(a) until a Successor Capital Securities Guarantee Trustee has been
appointed and has accepted such appointment by written instrument executed by
such Successor Capital Securities Guarantee Trustee and delivered to the
Guarantor.

(c)        The Capital
Securities Guarantee Trustee may resign from office (without need for prior or
subsequent accounting) by an instrument in writing executed by the Capital
Securities Guarantee Trustee and delivered to the Guarantor, which resignation
shall not take effect until a Successor Capital Securities Guarantee Trustee
has been appointed and has accepted such appointment by instrument in writing
executed by such Successor Capital Securities Guarantee Trustee and delivered
to the Guarantor and the resigning Capital Securities Guarantee Trustee.

(d)        If no Successor
Capital Securities Guarantee Trustee shall have been appointed and accepted
appointment as provided in this Section 4.2 within 60 days after delivery of an
instrument of removal or resignation, the Capital Securities Guarantee Trustee
resigning or being removed may petition any court of competent jurisdiction for
appointment of a Successor Capital Securities Guarantee Trustee.  Such court
may thereupon, after prescribing such notice, if any, as it may deem proper,
appoint a Successor Capital Securities Guarantee Trustee.

(e)        No Capital
Securities Guarantee Trustee shall be liable for the acts or omissions to act
of any Successor Capital Securities Guarantee Trustee.

(f)         Upon termination
of this Capital Securities Guarantee or removal or resignation of the Capital
Securities Guarantee Trustee pursuant to this Section 4.2, the Guarantor shall
pay to the Capital Securities Guarantee Trustee all amounts accrued to the date
of such termination, removal or resignation.

                                                                                              
11

ARTICLE 5

GUARANTEE

SECTION 5.1  
Guarantee.  

The Guarantor irrevocably
and unconditionally agrees to pay in full to the Holders the Guarantee Payments
(without duplication of amounts theretofore paid by the Issuer), as and when
due, regardless of any defense, right of set‐off or counterclaim that the
Issuer may have or assert.  The Guarantor's obligation to make a Guarantee
Payment may be satisfied by direct payment of the required amounts by the
Guarantor to the Holders or by causing the Issuer to pay such amounts to the
Holders.

SECTION 5.2  
Waiver of Notice and Demand.  

The Guarantor hereby waives notice of acceptance of this
Capital Securities Guarantee and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.

SECTION 5.3  
Obligations Not Affected.  

The obligations, covenants, agreements and duties of the
Guarantor under this Capital Securities Guarantee shall in no way be affected
or impaired by reason of the happening from time to time of any of the
following:

(a)        the release or
waiver, by operation of law or otherwise, of the performance or observance by
the Issuer of any express or implied agreement, covenant, term or condition
relating to the Capital Securities to be performed or observed by the Issuer;

(b)        the extension of
time for the payment by the Issuer of all or any portion of the Distributions,
Redemption Price, Liquidation Distribution or any other sums payable under the
terms of the Capital Securities or the extension of time for the performance of
any other obligation under, arising out of, or in connection with, the Capital
Securities (other than an extension of time for payment of Distributions, Redemption
Price, Liquidation Distribution or other sum payable that results from the
extension of any interest payment period on the Notes);

(c)        any failure,
omission, delay or lack of diligence on the part of the Holders to enforce,
assert or exercise any right, privilege, power or remedy conferred on the
Holders pursuant to the terms of the Capital Securities, or any action on the
part of the Issuer granting indulgence or extension of any kind;

(d)        the voluntary or
involuntary liquidation, dissolution, sale of any collateral, receivership,
insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt of, or other
similar proceedings affecting, the Issuer or any of the assets of the Issuer;

(e)        any invalidity of,
or defect or deficiency in, the Capital Securities;

                                                                                     
12

(f)         any failure or
omission to receive any regulatory approval or consent required in connection
with the Common Securities or Capital Securities, including the failure to
receive any approval of the Board of Governors of the Federal Reserve System
required in connection with the Capital Securities;

(g)        the settlement or
compromise of any obligation guaranteed hereby or hereby incurred; or

(h)        any other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a guarantor, it being the intent of this Section 5.3
that the obligations of the Guarantor hereunder shall be absolute and
unconditional under any and all circumstances.

There shall be no obligation of the Holders to give
notice to, or obtain consent of, the Guarantor with respect to the happening of
any of the foregoing.

SECTION 5.4  
Rights of Holders.  

(a)        The
Holders of a Majority in liquidation amount of the Securities have the right to
direct the time, method and place of conducting of any proceeding for any
remedy available to the Capital Securities Guarantee Trustee in respect of this
Capital Securities Guarantee or exercising any trust or power conferred upon
the Capital Securities Guarantee Trustee under this Capital Securities
Guarantee.

(b)        If the Capital
Securities Guarantee Trustee fails to enforce such Capital Securities
Guarantee, any Holder of Capital Securities may institute a legal proceeding
directly against the Guarantor to enforce the Capital Securities Guarantee
Trustee's rights under this Capital Securities Guarantee, without first
instituting a legal proceeding against the Issuer, the Capital Securities
Guarantee Trustee or any other person or entity.  The Guarantor waives any
right or remedy to require that any action be brought first against the Issuer
or any other person or entity before proceeding directly against the Guarantor.

SECTION 5.5  
Guarantee of Payment.  

This Capital Securities Guarantee creates a guarantee of
payment and not of collection.

SECTION 5.6  
Subrogation.  

The Guarantor shall be subrogated to all (if any) rights
of the Holders against the Issuer in respect of any amounts paid to such
Holders by the Guarantor under this Capital Securities Guarantee; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any right that
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Capital Securities
Guarantee, if, at the time of any such payment, any amounts are due and unpaid
under this Capital Securities Guarantee.  If any amount shall be paid to the
Guarantor in violation of the preceding sentence, the Guarantor agrees to hold
such amount in trust for the Holders and to pay over such amount to the
Holders.

                                                                                       
13

SECTION 5.7  
Independent Obligations.  

The Guarantor acknowledges that its obligations
hereunder are independent of the obligations of the Issuer with respect to the
Capital Securities, and that the Guarantor shall be liable as principal and as
debtor hereunder to make Guarantee Payments pursuant to the terms of this
Capital Securities Guarantee notwithstanding the occurrence of any event
referred to in subsections (a) through (h), inclusive, of Section 5.3 hereof.

ARTICLE 6

LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 6.1  
Limitation of Transactions.  

So long as any Capital Securities remain outstanding, if
there shall have occurred and be continuing an Event of Default under this
Capital Securities Guarantee, an Event of Default or a Nonpayment under the
Declaration or during an Extended Interest Payment Period (as defined in the
Indenture), then (a) the Guarantor shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of its capital stock (other than (i)
purchases or acquisitions of shares of its common stock in connection with the
satisfaction by the Guarantor of its obligations under any employee benefit
plans, (ii) as a result of a reclassification of the Guarantor's capital stock
or the exchange or conversion of one class or series of the Guarantor's capital
stock for another class or series of the Guarantor's capital stock, or (iii) the
purchase of fractional interests in shares of the Guarantor's capital stock
pursuant to an acquisition or the conversion or exchange provisions of such
capital stock of the Guarantor or the security being converted or exchanged) or
make any guarantee payments with respect to the foregoing or (b) the
Guarantor shall not make any payment of interest, principal or premium, if any,
on or repay, repurchase or redeem any debt securities (including guarantees)
issued by the Guarantor which rank pari passu with or junior to the Notes.

SECTION 6.2  
Ranking.  

This Capital Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to all other liabilities, including contingent liabilities,
of the Guarantor, (ii) pari passu with the most senior preferred or preference
stock now or hereafter issued by the Guarantor and with any guarantee now or
hereafter entered into by the Guarantor in respect of any preferred securities
(including trust preferred securities) or preference stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.

                                                                                        
14

ARTICLE 7

TERMINATION

SECTION 7.1  
Termination.  

This Capital Securities
Guarantee shall terminate upon (i) full payment of the Redemption Price of all
Capital Securities, (ii) upon the distribution of the Notes to the Holders of
all of the Capital Securities, or (iii) upon full payment of the amounts
payable in accordance with the Declaration upon liquidation or dissolution of
the Issuer.  Notwithstanding the foregoing, this Capital Securities Guarantee
will continue to be effective or will be reinstated, as the case may be, if at
any time any Holder must restore payment of any sums paid under the Capital
Securities or under this Capital Securities Guarantee.

ARTICLE 8

INDEMNIFICATION

SECTION 8.1  
Exculpation.  

            (a)        No
Indemnified Person shall be liable, responsible or accountable in damages or
otherwise to the Guarantor or any Covered Person for any loss, damage or claim
incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Capital Securities
Guarantee and in a manner that such Indemnified Person reasonably believed to
be within the scope of the authority conferred on such Indemnified Person by
this Capital Securities Guarantee or by law, except that an Indemnified Person
shall be liable for any such loss, damage or claim incurred by reason of such
Indemnified Person's negligence or willful misconduct with respect to such acts
or omissions.

            (b)        An
Indemnified Person shall be fully protected in relying in good faith upon the
records of the Guarantor and upon such information, opinions, reports or
statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable
care by or on behalf of the Guarantor, including information, opinions, reports
or statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Capital Securities might properly be paid.

SECTION 8.2  
Indemnification.  

The Guarantor agrees to indemnify each Indemnified
Person for, and to hold each Indemnified Person harmless against, any and all
loss, liability, damage, claim or expense incurred without negligence or bad
faith on its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses (including reasonable legal fees and expenses) of defending itself
against, or investigating, any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.  The
obligation to indemnify as set forth in this Section 8.2 shall survive the
termination of this Capital Securities Guarantee.

                                                                                          
15

ARTICLE 9

MISCELLANEOUS

SECTION 9.1  
Successors and Assigns.  

All guarantees and
agreements contained in this Capital Securities Guarantee shall bind the
successors, assigns, receivers, trustees and representatives of the Guarantor
and shall inure to the benefit of the Holders of the Capital Securities then
outstanding.

SECTION 9.2  
Amendments.  

Except with respect to any changes that do not adversely
affect the rights of Holders (in which case no consent of Holders will be
required), this Capital Securities Guarantee may only be amended with the prior
approval of the Holders of at least a Majority in liquidation amount (including
the stated amount that would be paid on redemption, liquidation or otherwise,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of all the outstanding Capital Securities.  The
provisions of Section 12.2 of the Declaration with respect to meetings of
holders of the Securities apply to the giving of such approval.

SECTION 9.3  
Notices.  

All notices provided for in this Capital Securities
Guarantee shall be in writing, duly signed by the party giving such notice, and
shall be delivered, sent by facsimile or mailed by first class mail, as
follows:

            (a)        If
given to the Capital Securities Guarantee Trustee, at the Capital Securities
Guarantee Trustee's mailing address set forth below (or such other address as
the Capital Securities Guarantee Trustee may give notice of to the Holders):

The Bank of
New York

                                    101 Barclay
Street, 8 West

                                    New York,
New York 10286

                                    Facsimile:  (904) 645-1921

                                    Attention: 
Corporate Trust Trustee Administration

(b)        If given to the Guarantor, at the Guarantor's
mailing address set forth below (or such other address as the Guarantor may
give notice of to the Holders of the Capital Securities):

Bank of
America Corporation

                                    Bank of
America Corporate Center

                                    NC1-007-07-06

                                    100 North
Tryon Street

                                    Charlotte,
North Carolina 28255

                                    Facsimile:  (704) 386-0270

                                    Attention:  Corporate
Treasury-Securities Administration

                                                                                   
16

(c)        If
given to any Holder of Capital Securities, at the address set forth on the
books and records of the Issuer.

All such notices shall be deemed to have been given when
received in person, sent by facsimile with receipt confirmed, or mailed by
first class mail, postage prepaid except that if a notice or other document is
refused delivery or cannot be delivered because of a changed address of which
no notice was given, such notice or other document shall be deemed to have been
delivered on the date of such refusal or inability to deliver.

SECTION 9.4  
Benefit.  

This Capital Securities Guarantee is solely for the
benefit of the Holders of the Capital Securities and, subject to Section
3.1(a), is not separately transferable from the Capital Securities.

SECTION 9.5  
Governing Law.  

THIS CAPITAL SECURITIES GUARANTEE SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.

[Signature
page follows.]

17

 

THIS CAPITAL SECURITIES GUARANTEE is executed as of the
day and year first above written.

BANK OF AMERICA CORPORATION, as
Guarantor

By: /s/ KAREN A. GOSNELL

Name:    Karen A. Gosnell

Title:     Senior Vice President

THE BANK OF NEW YORK, as Capital
Securities Guarantee Trustee

By: /s/ VAN K. BROWN

Name:  Van K. Brown

Title:  Vice President

  

 

 

 

                                                                                         
18St. Jude Medical, Inc. Exhibit 10.1 to Form 8-K

Exhibit 10.1

SEVERANCE AGREEMENT

 

This agreement is made as of the _____ day of _________, 200__, between St. Jude
Medical, Inc., a Minnesota corporation,  with its principal offices at St. Paul,
Minnesota (the “Company”) and ______________  (“Executive”),
residing at _________________________________________________.

WITNESSETH THAT:

 

WHEREAS, this Agreement is intended to specify the financial arrangements that the Company will provide to Executive upon Executive’s separation from employment with the Company under any of the circumstances described herein; and

 

 [WHEREAS, this Agreement is intended to replace and supersede the existing Severance Agreement between the Company and Executive dated as of ___________________ relating to payments to be made to Executive upon a change in control of the Company (the “Prior Agreement”); and]

 

WHEREAS, this Agreement is entered into by the Company in the belief that it is in the best interests of the Company and its shareholders to provide stable conditions of employment for Executive notwithstanding the possibility, threat or occurrence of certain types of change in control, thereby enhancing the Company’s ability to attract and retain highly qualified people.

 

NOW, THEREFORE, to assure the Company that it will have the continued dedication of Executive notwithstanding the possibility, threat or occurrence of a bid to take over control of the Company, and to induce Executive to remain in the employ of the Company, and for other good and valuable consideration, the Company and Executive agree as follows:

 

1.           Term of Agreement. The term of this Agreement shall commence on the date hereof as first written above and shall continue through January 1, 2007; provided that commencing on January 1, 2007 and each January 1st thereafter, the term of this Agreement shall automatically be extended for one additional year unless not later than December 31 of the preceding year, the Company shall have given notice that it does not wish to extend this Agreement; and provided, further, that notwithstanding any such notice by the Company not to extend, this
Agreement shall continue in effect for a period of 36 months beyond the term provided herein if a Change in Control (as defined in Section 3(i) hereof) shall have occurred during such term.

 

2.           Termination of Employment.

 

(i)          Prior to a Change in Control. Executive’s rights upon termination of employment prior to a Change in Control (as defined in Section 3(i) hereof) shall be governed by the Company’s standard employment termination policy applicable to Executive in effect at the time of termination or, if applicable, any written employment agreement between the Company and Executive other than this Agreement in effect at the time of termination.

(ii)           After a Change in Control.

 

(a)          From and after the date of a Change in Control (as defined in Section 3(i) hereof) during the term of this Agreement, the Company shall not terminate Executive from employment with the Company except as provided in this Section 2(ii) or as a result of Executive’s Disability (as defined in Section 3(iv) hereof), Retirement (as defined in Section 3(v) hereof) or death.

 

(b)          From and after the date of a Change in Control (as defined in Section 3(i) hereof) during the term of this Agreement, the Company shall have the right to terminate Executive from employment with the Company at any time during the term of this Agreement for Cause (as defined in Section 3(iii) hereof), by written notice to Executive, specifying the particulars of the conduct of Executive forming the basis for such termination.

 

(c)          From and after the date of a Change in Control (as defined in Section 3(i) hereof) during the term of this Agreement:  (x) the Company shall have the right to terminate Executive’s employment without Cause (as defined in Section 3(iii) hereof), at any time; and (y) Executive shall, upon the occurrence of such a termination by the Company without Cause, or upon the voluntary termination of Executive’s employment by Executive for Good Reason (as defined in Section 3(ii) hereof), be entitled to receive the benefits provided in Section 4 hereof. Executive shall evidence a voluntary termination for Good Reason by written notice to the Company given within 60 days after the date of the occurrence of any event that Executive knows or should reasonably have known constitutes Good Reason for voluntary termination. Such notice
need only identify Executive and set forth in reasonable detail the facts and circumstances claimed by Executive to constitute Good Reason. Any notice give by Executive pursuant to this Section 2 shall be effective five business days after the date it is given by Executive.

 

3.             Definitions.

 

(i)            A “Change in Control” shall mean:

 

 (a)          a change in control of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or successor provision thereto, whether or not the Company is then subject to such reporting requirement;

 

 (b)          any “person” (as such term is used in Sections 13(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of the Company representing 35% or more of the combined voting power of the Company’s then outstanding securities;

 (c)          the Continuing Directors (as defined in Section 3(vi) hereof) cease to constitute a majority of the Company’s Board of Directors; provided that such change is the direct or indirect result of a proxy fight and contested election or elections for positions on the Board of Directors; or

 

 (d)          the majority of the Continuing Directors (as defined in Section 3(vi) hereof), excluding any Continuing Director who has this Severance Agreement, determine in their sole and absolute discretion that there has been a change in control of the Company.

 

 (ii)           “Good Reason” shall mean the occurrence of any of the following events, except for the occurrence of such an event in connection with the termination or reassignment of Executive’s employment by the Company for Cause (as defined in Section 3(iii) hereof), for Disability (as defined in Section 3(iv) hereof), for Retirement (as defined in Section 3(v) hereof) or for death:

 

 (a)          the assignment to Executive of any duties inconsistent with Executive’s status or position with the Company, or a substantial alteration in the nature or status of Executive’s responsibilities from those in effect immediately prior to the Change in Control;

 

 (b)          a reduction by the Company in Executive’s annual compensation in effect immediately prior to the Change in Control;

 

 (c)          the Company’s requiring Executive to be based anywhere other than within 50 miles of Executive’s office location immediately prior to a Change in Control except for required travel on the Company’s business to an extent substantially consistent with Executive’s business travel obligations immediately prior to the Change in Control;

 

 (d)          the failure by the Company to continue to provide Executive with benefits at least as favorable to those enjoyed by Executive under any of the Company’s pension, life insurance, medical, health and accident, disability, deferred compensation, incentive, stock, stock purchase, stock option, savings, perk package or other plans or programs in which Executive participates, or any action by the Company which would directly or indirectly materially reduce any of such benefits or deprive Executive of any material fringe benefit enjoyed immediately prior to the Change in Control, or the failure by the Company to provide Executive with the number of paid vacation days to which Executive is entitled immediately prior to the Change in Control; or

 

 (e)          the failure of the Company to obtain, as specified in Section 6(i) hereof, an assumption of the obligations of the Company to perform this Agreement by any successor to the Company.

 

Notwithstanding anything herein to the contrary, if the Change in Control arises from a transaction or series of transactions which are not authorized, recommended or approved by formal action taken by the Continuing Directors (as defined in Section 3(vi) hereof), Executive may voluntarily terminate his or her employment for any reason on the 180th day following the Change in Control, and such termination shall be deemed “Good Reason” for all purposes of this agreement.

 (iii)        “Cause” shall mean termination by the Company of Executive’s employment based upon the conviction of Executive by a court of competent jurisdiction for felony criminal conduct.

 

 (iv)        “Disability” shall mean that, as a result of incapacity due to physical or mental illness, Executive shall have been absent from the full-time performance of Executive’s duties with the Company for six consecutive months, and within 30 days after written notice of termination is given, Executive shall not have returned to the full-time performance of Executive’s duties. Any question as to the existence of Executive’s Disability upon which Executive and the Company cannot agree shall be determined by a qualified independent physician selected by Executive (or, if Executive is unable to make such selection, it shall be made by any adult member of Executive’s immediately family), and approved by the Company. The determination of such physician made in writing to the
Company and to Executive shall be final and conclusive for all purposes of this Agreement.

 

 (v)         “Retirement” shall mean termination on or after attaining normal retirement age in accordance with the Company’s Profit Sharing Employee Savings Plan and Trust.

 

 (vi)        “Continuing Director” shall mean any person who is a member of the Board of Directors of the Company, while such person is a member of the Board of Directors, and who (a) was a member of the Board of Directors on the date of this Agreement as first written above or (b) subsequently becomes a member of the Board of Directors, if such person’s nomination for election or initial election to the Board of Directors is recommended or approved by a majority of the Continuing Directors.

 

4.            Benefits upon Termination under Section 2(ii)(c).

 

 (i)           Upon the termination (voluntary or involuntary) of the employment of Executive pursuant to Section 2(ii)(c) hereof, Executive shall be entitled to receive the benefits specified in this Section 4. The amounts due to Executive under this Section 4(i) shall be paid to Executive in a lump sum not later than one business day prior to the date that the termination of Executive’s employment becomes effective. Subject to the provisions of Section 4(ii) hereof, all benefits to Executive pursuant to this Section 4(i) shall be subject to any applicable payroll or other taxes required by law to be withheld.

 

 (a)          The Company shall pay Executive, through the date the termination of Executive’s employment became effective, Executive’s base salary as in effect at the time of the notice of termination is given and any other form or type of compensation otherwise payable for such period. Executive shall be entitled to receive all benefits payable to Executive under the Company’s Profit Sharing Employee Savings Plan and Trust or any successor of such Plan and any other plan or agreement relating to retirement benefits which shall be in addition to, and not reduced by, any other amounts payable to Executive under this Section 4. Executive shall be entitled to exercise all rights and to receive all benefits accruing to Executive under any and all Company stock purchase plans, stock option plans and other stock plans or programs,
or any successor to any such plans or programs, which shall be in addition to, and not reduced by, any other amounts payable to Executive under this Section 4.

 (b)          In lieu of any further salary payments for periods subsequent to the date the termination of Executive’s employment became effective, the Company shall pay a severance payment in an amount equal to 2.9 times Executive’s Annual Compensation, as defined below. For purposes of this Section 4, “Annual Compensation” shall mean Executive’s annual salary (regardless of whether all or any portion of such salary has been contributed to a deferred compensation plan), the annual amount of Executive’s perk package, the target bonus for which Executive is eligible upon attainment of 100% of the target (regardless of whether such target bonus has been achieved or whether conditions of such target bonus are actually fulfilled), and any other type or form of compensation paid to Executive by the Company (or any
entity affiliated with the Company (“Affiliate”) within the meaning of Section 1504 of the Internal Revenue Code of 1986, as may be amended from time to time (the “Code”)) and included in Executive’s gross income for federal tax purposes during the twelve month period ending immediately prior to the date that the termination of Executive’s employment became effective but reduced by: (i) any amount actually paid to Executive as a cash payment of the target bonus (regardless of whether all or any portion of such target bonus was contributed to a deferred compensation plan); (ii) compensation income recognized as a result of the exercise of stock options or sale of the stock so acquired; and (iii) any payments actually or constructively received from a plan or arrangement of deferred compensation between the Company and Executive. All of the factors included in Annual Compensation shall be those in effect on the date that the termination of Executive’s
employment became effective and shall be calculated without giving effect to any reduction in such compensation that would constitute a breach of this Agreement.

 

 (c)          For a period of 36 months following the date that the termination of Executive’s employment became effective or until Executive reaches age 65 or dies, whichever is the shorter period, the Company shall arrange to provide for Executive, at the Company’s expense, the health, accident, disability and life insurance benefits substantially similar to those in effect for Executive immediately prior to the date that the termination of Executive’s employment became effective.

 

 (d)          The Company shall pay to Executive (1) any amount earned by Executive as a bonus with respect to the fiscal year of the Company preceding the termination of Executive’s employment if such bonus has not theretofore been paid to Executive, and (2) an amount representing credit for any vacation earned or accrued by Executive but not taken.

 

 (e)          The Company shall also pay to Executive all legal fees and expenses incurred by Executive as a result of such termination of employment (including all fees and expenses, if any, incurred by Executive in contesting or disputing any such termination or in seeking to obtain or enforce any right or benefit provided to Executive by this Agreement whether by arbitration or otherwise).

 (f)          Any and all contracts, agreements or arrangements between the Company and Executive prohibiting or restricting Executive from owning, operating, participating in, or providing employment or consulting services to, any business or company competitive with the Company at any time or during any period after the date the termination of Executive’s employment becomes effective, shall be deemed terminated and of no further force or effect as of the date the termination of Executive’s employment becomes effective, to the extent, but only to the extent, such contracts, agreements or arrangements so prohibit or restrict Executive; provided that the foregoing provision shall not constitute a license or right to use any proprietary
information of the Company and shall in no way affect any such contracts, agreements or arrangements insofar as they relate to nondisclosure and nonuse or proprietary information of the Company notwithstanding the fact that such nondisclosure and nonuse may prohibit or restrict Executive in certain competitive activities.

 

 (ii)           In the event that any payment or benefit received or to be received by Executive in connection with a Change in Control of the Company or termination of Executive’s employment (whether payable pursuant to the terms of this Agreement or any other plan, contract, agreement or arrangement with the company, with any person whose actions result in a Change in Control of the Company or with any person constituting a member of an “affiliated group” as defined in Section 280G(d)(5) of the Code, with the Company or with any person whose actions result in a Change in Control of the Company (collectively, the “Total Payments”)) would be subject to the excise tax imposed by Section 4999 of the Code, or any successor provision thereto, or any interest, penalties or additions to tax with respect to such excise tax (such
excise tax, together with any such interest, penalties or additions to tax, are collectively referred to as the “Excise Tax”), then Executive shall be entitled to receive from the Company an additional cash payment (a “Gross-Up Payment”) within thirty business days of such determination in an amount such that after payment by Executive of all taxes (including any interest, penalties or additions to tax imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments. All determinations required to be made under this Section 4(ii), including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment, shall be made by the independent accounting firm retained by the Company on the date of the Change in Control (the “Accounting Firm”), which shall provide detailed supporting calculations both to the
Company and Executive within 15 business days of the date that the termination of Executive’s employment becomes effective, or such earlier time as is requested by the Company. If the Accounting Firm determines that no Excise Tax is payable by Executive, it shall furnish Executive with an opinion that Executive has substantial authority not to report any Excise Tax on Executive’s federal income tax return.

 

Any uncertainty in the application of Section 4999 of the Code, or any successor provision thereto, at the time of the initial determination by the Accounting Firm hereunder shall be resolved in favor of Executive. As a result of the uncertainty in the application of Section 4999 of the Code, or any successor provision thereto, at the time of the initial determination by the Accounting Firm hereunder, it is possible that at a later time there will be a determination that the Gross-Up Payments made by the Company were less than the Gross-Up Payments that should have been made by the Company (“Underpayment”), consistent with the calculations required to be made hereunder. In the event that Executive is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment, if any, that has occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of Executive. As a result of the uncertainty in the application of Section 4999 of the Code, or any successor provision thereto, at the time of the initial determination by the Accounting Firm hereunder, it is possible that at a later time there will be a determination that the Gross-Up Payments made by the Company were more than the Gross-Up Payments that should have been made by the Company (“Overpayment”), consistent with the calculations required to be made hereunder. Executive agrees to refund the Company the amount of any Overpayment that the Accounting Firm shall determine has occurred hereunder. Any good faith determination by the Accounting Firm as to the amount of any Gross-Up Payment, including the amount of any Underpayment or Overpayment, shall be binding upon the Company and Executive.

 (iii)          Any payment not made to Executive when due hereunder shall thereafter, until paid in full, bear interest at the rate of interest equal to the reference rate announced from time to time by Wells Fargo Bank Minnesota, National Association, plus two percent, with such interest to be paid to Executive upon demand or monthly in the absence of a demand.

 

 (iv)          Executive shall not be required to mitigate the amount of any payment provided for in this Section 4 by seeking other employment or otherwise. The amount of any payment or benefit provided in this section 4 shall not be reduced by any compensation earned by Executive as a result of any employment by another employer, by any retirement benefits or otherwise.

 

 5.
            Executive’s Agreements.

 

Executive agrees that:

 

 (i)            Without the consent of the Company, Executive will not terminate employment with the Company without giving 30 days prior notice to the Company, and during such 30-day period Executive will assist the Company, as and to the extent reasonably requested by the Company, in training the successor to Executive’s position with the Company. The provisions of this Section 5(i) shall not apply to any termination (voluntary or involuntary) of the employment of Executive pursuant to Section 2(ii)(c) hereof.

 

 (ii)           In the event that Executive has received any benefits from the Company under Section 4 of this Agreement, then, during the period of 36 months following the date that the termination of Executive’s employment became effective, Executive, upon request by the Company:

 

 (a)          Will consult with one or more of the executive officers concerning the business and affairs of the Company for not to exceed four hours in any month at times and places selected by Executive as being convenient to him, all without compensation other than what is provided for in Section 4 of this Agreement; and

 

 (b)          Will testify as a witness on behalf of the Company in any legal proceedings involving the Company which arise out of events or circumstances that occurred or existed prior to the date that the termination of Executive’s employment became effective (except for any such proceedings relating to this Agreement), without compensation other than what is provided for in Section 4 of this Agreement, provided that all out-of-pocket expenses incurred by Executive in connection with serving as a witness shall be paid by the Company.

Executive shall not be required to perform Executive’s obligations under this Section 5(ii) if and so long as the Company is in default with respect to performance of any of its obligations under this Agreement.

 

6.           Successors and Binding Agreement.

 

 (i)          The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Company), by agreement in form and substance satisfactory to Executive, to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. Failure of the Company to obtain such agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle Executive to compensation from the Company in the same amount and on the same terms as Executive would be entitled hereunder if Executive terminated employment after a Change in Control for Good Reason, except that for purposes of implementing the
foregoing, the date on which any such succession becomes effective shall be deemed the date that the termination of Executive’s employment becomes effective. As used in this Agreement, “Company” shall mean the Company and any successor to its business and/or assets which executes and delivers the agreement provided for in this Section 6(i) or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of law.

 

 (ii)         This Agreement is personal to Executive, and Executive may not assign or transfer any part of Executive’s rights or duties hereunder, or any compensation due to him hereunder, to any other person. Notwithstanding the foregoing, this Agreement shall inure to the benefit of and be enforceable by Executive’s personal or legal representatives, executors, administrators, heirs, distributees, devisees, and legatees. 

 

7.           Modification; Waiver. No provisions of this Agreement may be modified, waived, or discharged unless such waiver, modification, or discharge is agreed to in a writing signed by Executive and such officer as may be specifically designated by the Board of Directors of the Company. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

 

8.           Notice. All notices, requests, demand, and all other communications required or permitted by either party to the other party by this Agreement (including, without limitation, any notice of termination of employment and any notice of an intention to arbitrate) shall be in writing and shall be deemed to have been duly given when delivered personally or received by certified or registered mail, return receipt requested, postage prepaid, at the address of the other party, as first written above (directed to the attention of the Board of Directors and Corporate Secretary in the case of the Company). Either party hereto may change its address for purposes of this Section 8 by giving 15 days prior notice to the other party hereto.

9.           Severability. If any term or provision of this agreement or the application hereof to any person or circumstances shall to any extent be invalid or unenforceable, the remainder of this Agreement or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby, and each term and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

 

10.         Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

 

11.         Governing Law. This Agreement has been made in the State of Minnesota and shall, in all respects, be governed by, and construed and enforced in accordance with, the laws of the State of Minnesota, including all matters of construction, validity and performance.

 

12.         Effect of Agreement; Entire Agreement. The Company and Executive understand and agree that this Agreement is intended to reflect their agreement only with respect to payments and benefits upon termination in certain cases and is not intended to create any obligation on the part of either party to continue employment. This Agreement supersedes any and all other oral or written agreements or policies made relating to the subject matter hereof [(including, without limitation, the Prior Agreement)] and constitutes the entire agreement of the parties relating to the subject matter hereof; provided that this Agreement shall not supersede or limit in any way Executive’s rights under any benefit
plan, program or arrangements in accordance with their terms (other than the provisions of the Company’s policy HR-1.02.25 entitled “Severance Pay,” effective January 1, 1994, as amended from time to time, or any successor to such policy, to the extent that payments are made hereunder).

 

13.         ERISA. For purposes of the Executive Retirement Income Security Act of 1974, this Agreement is intended to be a severance pay employee welfare benefit plan, and not an employee pension benefit plan, and shall be construed and administered with that intention.

 

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in its name by a duly authorized officer, and Executive has hereunto set his or her hand, all as of the date first written above.

 

 

	
             
 	
             
 	
            ST. JUDE MEDICAL, INC.
 
	 
	 
	
              
 	
             
 	
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            Its
 	
             
 
	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 
	 
	
             
 	
             
 	
            EXECUTIVE

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