Exhibit 10.3
NON-QUALIFIED STOCK OPTION
AGREEMENT
This Option Agreement (the
“Agreement”) is made between Qwest Communications
International Inc., a Delaware corporation (the
“Company”),
and (the
“Optionee”).
WHEREAS, pursuant to the Qwest Communications
International Inc. Equity Incentive Plan (the “Plan”),
the Company desires to afford the Optionee the opportunity to
purchase shares of Company Common Stock, par value $.01 per share
(the “Common Shares”).
NOW, THEREFORE, in connection with the mutual
covenants hereinafter set forth and for other good and valuable
consideration, the receipt and adequacy of which is hereby
acknowledged, the parties hereto agree as follows:
1.
DEFINITIONS;
CONFLICTS.
Capitalized terms used and not otherwise defined
herein shall have the meanings given thereto in the Plan. The
terms and provisions of the Plan are incorporated herein by
reference. In the event of a conflict or inconsistency
between the terms and provisions of the Plan and the terms and
provisions of this Agreement, the terms and provisions of the Plan
shall govern and control. In the event of a conflict or
inconsistency between the terms and conditions of this Agreement
and any agreement between Optionee and U S WEST, Inc. and/or
its subsidiaries, the terms and conditions of this Agreement shall
govern and control. In the event of a conflict or
inconsistency between the terms and conditions of this Agreement
and any employment agreement between Company and Optionee (other
than an agreement between the Optionee and
U S WEST, Inc. and/or its subsidiaries), such
employment agreement shall govern.
2.
GRANT OF OPTIONS.
The Company hereby grants to the Optionee the
right and option (the “Option” or
“Options”) to purchase up to, but not exceeding in the
aggregate,
Common Shares, on the terms and conditions herein set forth.
This grant is made and effective as of
(the “Grant Date”).
3.
PURCHASE PRICE.
The purchase price of each Common Share covered
by the Option shall
be
(the “Purchase Price”).
4.
TERM OF OPTIONS.
The term of the Option shall be ten years from
the Grant Date, subject to earlier termination as provided in
Sections 6 and 8 hereof.
5.
VESTING OF
OPTIONS.
The Option, subject to the terms,
conditions and limitations contained herein, shall vest and become
exercisable with respect to the Common Shares in one-third
installments upon each of the first three anniversaries following
the Grant Date; provided that, with respect to each installment,
the Optionee has remained in continuous employment with the Company
from the Grant Date until the date such installment is designated
to vest.
Notwithstanding the vesting schedule set forth
above, the Options will vest and become immediately exercisable in
the event of the Optionee’s death or Disability and under the
circumstances described in Section 7 below.
6.
TERMINATION OF
EMPLOYMENT.
(a)
Termination of Employment for
Reasons other than Death, Disability, Retirement or
Cause. In the
event the Optionee’s employment with the Company terminates
for reasons other than Optionee’s death, Disability,
Retirement or Cause, the Option shall remain exercisable for a
period of up to 90 calendar days after the date of Optionee’s
termination of employment (but not beyond the term of the Option),
to the extent vested and exercisable on the date of
Optionee’s termination of employment.
(b)
Termination of Employment Because
Optionee Dies, Becomes Disabled or Retires. In the event Optionee’s employment
with the Company terminates because Optionee dies, becomes Disabled
(as defined in the Plan) or Retires, the Option shall remain
exercisable for two years after Optionee’s termination of
employment (but not beyond the term of the Option), to the extent
vested and exercisable at the time Optionee’s employment
terminated. For purposes of this Agreement, the terms
“Retire” and “Retirement” shall mean that,
at the time of Optionee’s termination of employment, Optionee
meets one of the following age and service
combinations:
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Age at Retirement
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Term of Employment
(as defined in the
Qwest Pension Plan)
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Combination 1
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Any Age
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at least 30 years
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Combination 2
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50-54
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at least 25 years
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Combination 3
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55-59
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at least 20 years
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Combination 4
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60-64
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at least 15 years
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Combination 5
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65 and older
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at least 10 years
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(c)
Termination of Employment for
Cause. In the
event Optionee’s employment with the Company is terminated by
the Company for Cause, the Option shall be forfeited as of the date
of such termination, whether or not otherwise vested or exercisable
on such date. For purposes of this Agreement, “cause”
shall mean:
(1)
Commission of an act deemed by the
Company in its sole discretion to be an act of dishonesty, fraud,
misrepresentation or other act of
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moral turpitude that would reflect
negatively upon Qwest or compromise the effective performance of
Optionee’s duties;
(2)
Unlawful conduct that would reflect
negatively upon Qwest or compromise the effective performance of
Optionee’s duties, as determined by the Company in its sole
discretion;
(3)
Conviction of (or pleading nolo
contendere to) any felony or a misdemeanor involving moral
turpitude;
(4)
Continued failure to substantially
perform Optionee’s duties to the satisfaction of his or her
supervisor (other than such failure resulting from Optionee’s
incapacity due to physical or mental illness) after the delivery of
written notice to Optionee specifically identifying the manner in
which Optionee has failed to substantially perform his or her
duties and Optionee has been afforded a reasonable opportunity to
substantially perform his or her duties; or
(5)
A willful violation of the Qwest
Code of Conduct or other Qwest policies that would reflect
negatively upon Qwest or compromise the effective performance of
Optionee’s duties, as determined by the Company in its sole
discretion.
(d)
Unvested Options Forfeited Upon
Termination of Employment. Any portion of the Option that has not vested as
of the date Optionee’s employment terminates shall be
forfeited immediately upon termination of Optionee’s
employment with the Company.
7.
CHANGE IN CONTROL.
Subject to the conflict provisions in Paragraph
1 of this Agreement, in the event of a Change in Control, the
Option shall vest in full and become immediately exercisable and
shall remain vested and exercisable during the remaining term
thereof.
8.
FORFEITURE OF
OPTION.
(a)
Performance for
Competitors. Notwithstanding any other provision of this
Agreement, Optionee shall immediately forfeit all rights under the
Option, if, Optionee accepts employment with a Competitor (as
defined herein) or during the 18 month period beginning on the date
of Optionee’s termination of employment, Optionee owns more
than 2% of the common stock of, or is employed by, advises,
represents or assists in any other way any Competitor and if the
Company, in its sole discretion, determines that such actions by
Optionee are, or could be, detrimental to the
Company. For the purposes of this Agreement,
“Competitor” means a person or entity that competes
with, or intends to compete with, the Company with respect to any
product sold or service performed by the Company in any state or
country in which the Company sells such products or performs such
services, and if the Company, in its sole discretion, determines
that such actions by Grantee are
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detrimental to the Company.
Notwithstanding the foregoing, if Optionee is an attorney, Optionee
may, subject to the applicable rules of ethics and the
nondisclosure provisions herein, perform services solely in his or
her capacity as an outside attorney on behalf of any person or
entity, even if such person or entity competes with Qwest or sells
goods or services similar to those Qwest sells.
(b)
Non-solicitation of
Employees. Notwithstanding any other provision of this
Agreement, Optionee shall immediately forfeit all rights under the
Option, if, during the one-year period beginning on the date of
Optionee’s termination of employment, Optionee induces any
employee of Qwest to leave Qwest’s employment, and if the
Company, in its sole discretion, determines that such actions by
Optionee are detrimental to the Company.
(c)
Nondisclosure.
Optionee will not disclose
outside of the Company or to any person within the Company who does
not have a legitimate business need to know, any Confidential
Information (as defined below) during Optionee’s employment
with the Company. Optionee will not disclose to anyone or
make any use of any Confidential Information of the Company after
Optionee’s employment with the Company ends for any reason,
except as required by law after timely notice is given by Optionee
to the Company. This agreement not to disclose or use
Confidential Information means, among other things, that Optionee,
for a period of 18 months beginning on the effective date of the
termination of Optionee’s employment with the Company or any
other Qwest entity for any reason, may not take or perform a job
whose responsibilities would likely lead Optionee to disclose or
use Confidential Information. Optionee acknowledges and
agrees that the assumption and performance of such
responsibilities, in that situation, would likely result in the
disclosure or use of Confidential Information and would likely
result in irreparable injury to the Company. Moreover, during
Optionee’s employment with the Company, Optionee shall not
disclose or use for the benefit of the Company, himself or any
other person or entity any confidential or trade secret information
belonging to any former employer or other person or entity to which
Optionee owes a duty of confidence or nondisclosure of such
information. If a court determines that this provision is too
broad, Optionee and Company agree that the court shall modify the
provision to the extent (but not more than is) necessary to make
the provision enforceable. “Confidential Information”
means any oral or written information not generally known outside
of the Company, including without limitation, trade secrets,
intellectual property, software and documentation, customer
information (including, without limitation, customer lists),
company policies, practices and codes of conduct, internal
analyses, analyses of competitive products, strategies, merger and
acquisition plans, marketing plans, corporate financial
information, information related to negotiations with third
parties, information protected by the Company’s privileges
(such as the attorney-client privilege), internal audit reports,
contracts and sales proposals, training materials, employment and
personnel records, performance evaluations, and other sensitive
information. This agreement does not relieve Optionee of any
obligations Optionee has to the Company under law. If
Optionee fails to comply with the provisions of this paragraph
8(c), Optionee shall immediately forfeit all rights under the
Option if the Company, in its sole discretion, determines that such
actions by Optionee are, or were, detrimental to the Company.
Nothing in
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this paragraph shall prevent or
limit Optionee’s ability to provide truthful responses to
legitimate inquiries from governmental agencies.
(d)
Post-termination finding of
Cause. Notwithstanding
any other provision of this Agreement, Optionee shall immediately
forfeit all rights under the Award and shall repay to Company all
proceeds from the vesting or lapsing of the Award occurring after
Optionee’s termination of employment, if, within the two-year
period beginning on Optionee’s termination date, the
Committee determines that Optionee, while employed by the Company,
engaged in conduct constituting Cause. Consistent with
applicable law, any repayments shall include an interest factor
equal to the applicable federal short term interest rate pursuant
to Internal Revenue Code section 1274. Interest shall begin
to accrue on the 31st day after Optionee (or, if applicable,
Optionee’s estate or beneficiary) received the
Company’s written notification of its determination that such
Cause exists or existed, and shall continue to accrue until
complete repayment is made to the Company. This provision
shall not be effective after a Change in Control.
9.
TRANSFERABILITY OF
OPTION.
Except to the extent permitted by the Committee
in accordance with the provisions of the Plan, the Optionee may not
voluntarily or involuntarily pledge, hypothecate, assign, sell or
otherwise transfer the Option except by will or the laws of descent
and distribution, and during the Optionee’s lifetime, the
Option shall be exercisable only by the Optionee.
10.
NO RIGHTS AS A
SHAREHOLDER.
The Optionee shall have no rights as a
shareholder with respect to any Common Shares until the date of
issuance to the Optionee of a certificate evidencing such Common
Shares. No adjustments, other than as provided in
Article IV of the Plan, shall be made for dividends (ordinary
or extraordinary, whether in cash, securities or other property) or
distributions for which the record date is prior to the date the
certificate for such Common Shares is issued.
11.
REGISTRATION: GOVERNMENTAL
APPROVAL.
The Option granted hereunder is subject to the
requirement that, if at any time the Company determines, in its
discretion, that the listing, registration, or qualifications of
Common Shares issuable upon exercise of the Option is required by
any securities exchange or under any state or Federal law,
rule or regulation, or the consent or approval of any
governmental regulatory body or other person is necessary or
desirable as a condition of, or in connection with, the issuance of
Common Shares, no Common Shares shall be issued, in whole or in
part, unless such listing, registration, qualification, consent or
approval has been effected or obtained free of any conditions or
with such conditions as are acceptable to the Committee.
12.
METHOD OF EXERCISING
OPTION.
Subject to the terms and conditions
of this Agreement, the Option may be exercised by contacting the
stock broker designated by the Company from time to time and
following such
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broker’s
instructions. Alternatively, if Optionee wishes to use
his or her personal stock broker, Optionee may provide written
notice to the Company, Attention: Manager, Stock
Administration. Such notice shall state the election to
exercise the Option and the number of Common Shares in respect of
which the Option is being exercised, shall be signed by the person
or persons so exercising the Option and shall be accompanied by
payment in full of the Purchase Price for such Common
shares.
Payment of such Purchase Price shall be made in
United States dollars by certified check or bank cashier’s
check payable to the order of the Company or by wire transfer to
such account as may be specified by the Company for this
purpose. Subject to such procedures and rules as may be
adopted from time to time by the Committee, the Optionee may also
pay such Purchase Price by (i) tendering to the Company Common
Shares with an aggregate Fair Market Value on the date of exercise
equal to such Purchase Price provided that such Common Shares must
have been held by the Optionee for more than six (6) months,
(ii) delivery to the Company of a copy of irrevocable
instructions to a stockbroker to sell Common Shares or to authorize
a loan from the stockbroker to the Optionee and to deliver promptly
to the Company an amount sufficient to pay such Purchase Price, or
(iii) any combination of the methods of payment described in
clauses (i) and (ii) and in the preceding sentence. The
certificate for Common Shares as to which the Option shall have
been so exercised shall be registered in the name of the person or
persons so exercising the Option. All Common Shares purchased
upon the exercise of the Option as provided herein shall be fully
paid and non-assessable.
The Company’s Insider Trading Policy 110
requires that all Insiders must pre-clear with the Law Department
all proposed transactions in Qwest Securities, including, but not
limited to, exercises of options prior to effecting such
transaction.
13.
INCOME TAX
WITHHOLDING.
The Company may make such provisions and take
such steps as it may deem reasonably necessary or appropriate for
the withholding of all federal, state, local and other taxes
required by law to be withheld with respect to the exercise of the
Option and the issuance of the Common Shares, including, but not
limited to, deducting the amount of any such withholding taxes from
any other amount then or thereafter payable to the Optionee, or
requiring the Optionee, or the beneficiary or legal representative
of the Optionee, to pay to the Company the amount required to be
withheld or to execute such documents as the Company deems
necessary or desirable to enable it to satisfy its withholding
obligations.
14.
COMMITTEE
DISCRETION.
Any decision, interpretation or other action
made or taken in good faith by the Committee arising out of or in
connection with this Agreement, the Plan or the Option shall be
final, binding and conclusive on the Company, Optionee and any
respective heir, executor, administrator, successor or
assign.
15.
NON-QUALIFIED STOCK
OPTION.
The Option granted hereunder is not intended to
be an “incentive stock option” within the meaning of
Section 422 of the Code.
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16.
WAIVER OF RIGHT TO
JURY.
By signing this Agreement, Optionee voluntarily,
knowingly and intelligently waives any right he or she may have to
a jury trial for all claims relating to this Agreement and any
other claim relating to Optionee’s employment with
Company. The Company also hereby voluntarily, knowingly, and
intelligently waives any right it might otherwise have to a jury
trial for all claims relating to this Agreement and any other claim
relating to Optionee’s employment with the
Company.
17.
GOVERNING LAW.
This Agreement shall be construed and
interpreted in accordance with the laws of the State of Delaware,
without regard to the conflict of laws provisions of any
state. Any action to enforce this Agreement shall be brought
in Colorado state or federal district court and the parties waive
any objection to the jurisdiction or venue of such
courts.
18.
HEADINGS.
Headings are for the convenience of the parties
and are not deemed to be part of this Agreement.
19.
EXECUTION.
This Agreement is voidable by the Company if the
Optionee does not execute the Agreement within 30 days of execution
by the Company.
IN WITNESS WHEREOF, the parties hereto have
executed this Agreement on the dates set forth opposite their
signatures to be effective as of the Grant Date.
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QWEST COMMUNICATIONS INTERNATIONAL
INC.
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By:
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Date
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Executive Vice President,
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General Counsel and Chief Administrative
Officer
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OPTIONEE:
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Date
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7
RESTRICTED STOCK
AGREEMENT
This Restricted Stock Agreement
(“Agreement”) is made between Qwest Communications
International Inc., a Delaware corporation (the
“Company”), and
(the “Grantee”).
WHEREAS, pursuant to the Qwest Communications
International Inc. Equity Incentive Plan (the “Plan”),
the Company desires to grant shares of Common Stock, par value
$0.01 per share, of the Company (“Common Stock”) to the
Grantee subject to the restrictions and on the terms and conditions
specified below.
NOW THEREFORE, in connection with the
mutual covenants hereinafter set forth and for other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the parties hereto agree as follows:
1.
DEFINITIONS;
CONFLICTS.
Capitalized terms used and not
otherwise defined herein shall have the meanings given thereto in
the Plan. The terms and provisions of the Plan are
incorporated herein by reference. In the event of a conflict
or inconsistency between the terms and provisions of the Plan and
the terms and provisions of this Agreement, the terms and
provisions of the Plan shall govern and control. In the event
of a conflict or inconsistency between the terms and conditions of
this Agreement and any agreement between Grantee and U S
WEST, Inc. and/or its subsidiaries, the terms and conditions
of this Agreement shall govern and control. In the event of a
conflict or inconsistency between the terms and conditions of this
Agreement and any employment agreement between Company and Grantee
(other than an agreement between the Grantee and
U S WEST, Inc. and/or its subsidiaries), such
employment agreement shall govern.
2.
GRANT OF RESTRICTED
STOCK.
The Company hereby grants to the
Grantee
shares (the “Shares”) of Common Stock (the
“Restricted Stock”), effective as of
(the “Transfer Date”). After the Grantee becomes
the holder of record with respect to the Restricted Stock, the
Grantee shall be treated as the beneficial owner of the Restricted
Stock and shall have the right to receive all amounts,