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SEVERANCE AGREEMENT

Termination Severance Agreement

SEVERANCE AGREEMENT | Document Parties: Qwest Communications International, Inc | Qwest Services Corporation You are currently viewing:
This Termination Severance Agreement involves

Qwest Communications International, Inc | Qwest Services Corporation

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Title: SEVERANCE AGREEMENT
Governing Law: Colorado     Date: 10/29/2008
Industry: Communications Services     Sector: Services

SEVERANCE AGREEMENT, Parties: qwest communications international  inc , qwest services corporation
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Exhibit 10.18

SEVERANCE AGREEMENT

This Severance Agreement (“Agreement”), which is effective as of [Date] (the “Effective Date”), is by and between [Name] (“Executive”), who is an officer of Qwest Communications International, Inc., a Delaware corporation having its principal executive offices in Denver, Colorado or one of its subsidiaries or affiliates (“Company”) and who is employed by Qwest Services Corporation, a subsidiary of the Company, and Company and any successor thereto:

WHEREAS, the Company wishes to encourage Executive’s continued service and dedication in the performance of Executive’s duties; and

WHEREAS, in order to induce Executive to remain in the employ of the Company, and in consideration for Executive’s continued service to the Company, the Company agrees that Executive shall receive the benefits set forth in this Agreement in the event that Executive’s employment with the Company is terminated in the circumstances described herein.

Therefore, in consideration of the mutual promises set forth below, Company and Executive hereby agree as follows:

1. TERM OF EMPLOYMENT; AT-WILL EMPLOYMENT . This Agreement does not contain any promise or representation concerning the duration of Executive’s employment. Executive’s employment is at-will, and may be altered or terminated by either Executive or the Company at any time, with or without cause, and with or without notice. This at-will employment relationship may not be modified unless in a written agreement signed by Executive and either the Chief Executive Officer or the Chief Human Resources Officer.

2 . CHANGE IN CONTROL

a. CHANGE IN CONTROL DEFINED: For purposes of this Agreement, “Change in Control” shall have the definition currently in the Qwest Equity Incentive Plan (“Stock Plan”).

b. STOCK OPTIONS/EQUITY : The Board of Directors may, in its discretion, periodically grant Executive additional stock options or other awards under the Stock Plan. Notwithstanding the terms of any stock option agreement to the contrary, pursuant to the Board of Directors’ resolution effective September 19, 2002, upon a Change in Control, all awards granted to Executive after September 19, 2002 under the Stock Plan shall immediately vest and all stock options shall remain exercisable for the full term of such option.

3. TERMINATION .

a. Termination for Cause . The Company may, in its sole discretion, immediately terminate this Agreement and Executive’s employment for Cause by giving notice to Executive. If Executive’s employment is terminated


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for Cause pursuant to this paragraph 3.a., Executive shall not be entitled to any severance payment or any other post-employment obligation provided under this Agreement. Any one or more of the following events shall, for purposes of this Agreement, constitute Cause:

(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 moral turpitude that would reflect negatively upon Qwest or compromise the effective performance of Executive’s duties;

(2) Unlawful conduct resulting in material injury to Qwest, as determined by the Company in its sole discretion;

(3) Conviction of (or pleading nolo contendere to) a felony or any misdemeanor involving moral turpitude;

(4) Continued failure to perform Executive’s duties to the satisfaction of the Chief Executive Officer (other than such failure resulting from Executive’s incapacity due to physical or mental illness) after the Chief Executive Officer delivers written notice to Executive specifically identifying the manner in which Executive has failed to substantially perform his or her duties and Executive has been afforded a reasonable opportunity to substantially perform his or her duties; or

(5) Willful violation of the Qwest Code of Conduct or other Qwest policies resulting in injury to Qwest, as determined by the Company in its sole discretion.

For two years following a Change in Control, a termination for Cause shall require the approval of the Board of Directors.

b. Severance Payments When Termination Not By Executive.

(1) Termination without Cause by Company . The parties agree that the Company may terminate Executive’s employment without Cause. Except under circumstances described in subparagraph 3.b(2) below, if Company terminates Executive’s employment without Cause, and Executive signs a complete waiver and release of claims against Qwest acceptable to Company in the form attached hereto as Attachment A (“Waiver”), then Company shall pay Executive the “Standard Severance Amount” defined below. The Waiver includes, among other terms, a provision requiring Executive to pay back to Qwest any severance received by Executive if after the payments are made it is determined that, while employed by Qwest or any Qwest entity, Executive engaged in conduct constituting Cause. The Waiver does not include a release of Qwest’s obligations, if any, to indemnify Executive under Qwest bylaws or applicable state law. The Standard Severance Amount will


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equal one and one-half times Executive’s highest annual base salary in effect during the 12 months preceding the termination of Executive’s employment. The Standard Severance Amount will be paid over an 18-month period through the Company’s regular management payroll processes. If, at the end of the 18-month period, Executive has not breached or threatened to breach any part of this Agreement, Executive will also receive a lump-sum payment equal to one and one-half times Executive’s highest target annual bonus in effect during the 12 months preceding the termination of Executive’s employment, minus any applicable or legally-required withholdings.

(2) Change in Control Termination . If Company (with the required approval of the Board of Directors) terminates Executive’s employment without Cause within two years following a Change in Control, then, provided Executive signs a Waiver, as described in subparagraph 3.b.(1) above, Company shall pay Executive the Change in Control Severance Amount defined in the following sentence: The Change in Control Severance Amount payable to Executive will equal (a) (i) three times Executive’s annual base salary in effect at the time of the termination of Executive’s employment, or, if greater, Executive’s annual base salary in effect at the time of the Change in Control, plus (ii) three times Executive’s target annual bonus in effect at the time of the termination of Executive’s employment, or, if greater, Executive’s target annual bonus in effect at the time of the Change in Control plus (b) a pro rata bonus payment for the portion of the bonus payment measurement period in which Executive was employed before the termination of Executive’s employment, calculated using individual, business unit and company performance at 100% of target. The Change in Control Severance amount will be paid in a lump sum within 30 days of receiving the signed Waiver.

c. Change in Control Termination for Good Reason . Executive may terminate his or her employment for Good Reason after giving written notice to the Company within sixty (60) days after an event constituting Good Reason, (as defined in subparagraph 3.c.(1) below). If Executive terminates Executive’s employment for Good Reason within two years following a Change in Control, then, provided Executive signs a Waiver (as defined in subparagraph 3.b.(1) above), Company shall pay Executive the Change in Control Severance Amount, as described in subparagraph 3.b.(2) above in a lump sum within 30 days of receiving the signed Waiver.

(1) Termination for Good Reason Following a Change in Control . For purposes of this subparagraph 3.c., Good Reason shall mean:


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(A)

a reduction of either base salary or Executive’s target annual bonus, where the salary or annual target bonus are measured immediately prior to such reduction, as opposed to at the time of Executive’s execution of this Agreement;

 

 

(B)

a material reduction of Executive’s responsibilities, where such responsibilities are measured immediately prior to such reduction, as opposed to at the time of Executive’s execution of this Agreement;

 

 

(C)

Company’s material breach of this Agreement;

 

 

(D)

Company’s failure to obtain the agreement of any successor to honor the terms of this Agreement; or

 

 

(E)

A requirement that Executive’s primary work location be moved to a location that is greater than thirty-five straight line miles from Executive’s primary work location immediately prior to the imposition of such requirement.

“Good Reason” shall not include any other circumstances, including but not limited to, Executive’s discharge for Cause, Executive’s resignation or retirement (other than in the circumstances set forth in (A) – (E) above), or any leave of absence.

d. COBRA Coverage . If Executive’s employment is terminated pursuant to subparagraph 3.b. or 3.c. above, Executive may be eligible for Qwest-subsidized COBRA for a period of 18 months (unless Executive becomes ineligible for or forfeits severance benefits pursuant to the terms of this Agreement) following the Executive’s election of COBRA health care continuation coverage (generally beginning as of the first day of the first month following the month in which Executive is designated as terminated on the Qwest payroll system) on the same basis as for active employees under the group medical plan. This provision shall not extend the period for which any Executive is eligible for COBRA continuation coverage.

4. SPECIAL TAX PROVISION .

a. Anything in this Agreement to the contrary notwithstanding, in the event that the Executive receives any amount or benefit (collectively, the “Covered Payments”) (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any person whose actions result in a change of ownership or effective control covered by Section 280G(b)(2) of the Internal Revenue Code of 1986, as amended (the “Code”) or any person affiliated with the Company or such person) that is or becomes subject to the excise tax imposed by or under Section 4999 of the Code (or any similar tax that may hereafter be imposed) and/or any interest or penalties with respect to such excise tax (such excise tax, together with such interest and penalties, is hereinafter collectively referred to as the


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“Excise Tax”) by reason of the application of Section 280G(b)(2) of the Code, the Company shall pay to the Executive an additional amount (the “Tax Reimbursement Payment”) such that after payment by the Executive of all taxes (including, without limitation, any interest or penalties and any Excise Tax imposed on or attributable to the Tax Reimbursement Payment itself), the Executive retains an amount of the Tax Reimbursement Payment equal to the sum of (i) the amount of the Excise Tax imposed upon the Covered Payments, and (ii) without duplication, an amount equal to the product of (A) any deductions disallowed for federal, state or local income tax purposes because of the inclusion of the Tax Reimbursement Payment in Executive’s adjusted gross income, and (B) the highest applicable marginal rate of federal, state or local income taxation, respectively, for the calendar year in which the Tax Reimbursement Payment is made or is to be made. The intent of this paragraph 4 is that after the Executive pays federal, state and local income taxes and any payroll taxes, the Executive will be in the same position as if the Executive were not subject to the Excise Tax under Section 4999 of the Code and did not receive the extra payments pursuant to this paragraph 4, and this paragraph 4 shall be interpreted accordingly.

b. Except as otherwise provided in subparagraph 4(a), for purposes of determining whether any of the Covered Payments will be subject to the Excise Tax and the amount of such Excise Tax, such Covered Payments will be treated as “parachute payments” (within the meaning of Section 280G(b)(2) of the Code) and such payments in excess of the Code Section 280(G)(b)(3) “base amount” shall be treated as subject to the Excise Tax, unless, and except to the extent that, the Company’s independent certified public accountants or legal counsel (reasonably acceptable to the Executive) appointed by such public accountants (or, if the public accountants decline such appointment and decline appointing such legal counsel, such independent certified public accountants as promptly mutually agreed on in good faith by the Company and the Executive) (the “Accountant”), deliver a written opinion to the Executive, reasonably satisfactory to the Executive’s legal counsel, that, in the event such reporting position is contested by the Internal Revenue Service, there will be a more likely than not chance of success with respect to a claim that the Covered Payments (in whole or in part) do not constitute “parachute payments,” represent reasonable compensation for services actually rendered (within the meaning of Section 280G(b)(4) of the Code) in excess of the “base amount” allocable to such reasonable compensation, or such “parachute payments” are otherwise not subject to such Excise Tax (with appropriate legal authority, detailed analysis and explanation provided therein by the Accountant); and the value of any Covered Payments which are non-cash benefits or deferred payments or benefits shall be determined by the Accountant in accordance with the principles of Section 280G of the Code.

c. For purposes of determining the amount of the Tax Reimbursement Payment, the Executive shall be deemed to pay federal, state and/or local income taxes at the highest applicable marginal rate of income taxation for the calendar year in which the Tax Reimbursement Payment is made or is to be made, and to have otherwise allowable deductions for federal, state and local income tax purposes at least equal to


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those disallowed due to the including of the Tax Reimbursement Payment in the Executive’s adjusted gross income.

d.    (1)    (A) In the event that prior to the time the Executive has filed any of the Executive’s tax returns for a calendar year in which Covered Payments are made, the Accountant determines, for any reason whatsoever, the correct amount of the Tax Reimbursement Payment to be less than the amount determined at the time the Tax Reimbursement Payment was made, the Executive shall repay to the Company, at the time that the amount of such reduction in the Tax Reimbursement Payment is determined by the Accountant, the portion of the prior Tax Reimbursement Payment attributable to the Excise Tax and federal, state and local income taxes imposed on the portion of the Tax Reimbursement Payment being repaid by the Executive, using the assumptions and methodology utilized to calculate the Tax Reimbursement Payment (unless manifestly erroneous), plus interest on the amount of such repayment at the rate provided in Section 1274(b)(2)(B) of the Code.

(B) In the event that the determination set forth in (A) above is made by the Accountant after the filing by the Executive of any of the Executive’s tax returns for a calendar year in which Covered Payments are made, the Executive shall file at the request of the Company an amended tax return in accordance with the Accountant’s determination, but no portion of the Tax Reimbursement Payment shall be required to be refunded to the Company until actual refund or credit of such portion has been made to the Executive, and interest payable to the Company shall not exceed the interest received or credited to the Executive by such tax authority for the period it held such portion (less any tax the Executive must pay on such interest and which the Executive is unable to deduct as a result of payment of the refund).

(C) In the event that the Executive receives a refund pursuant to (B) above and repays such amount to the Company, the Executive shall thereafter file for any refunds or credits that may be due to Executive by reason of the repayments to the Company. The Executive and the Company shall mutually agree upon the course of action, if any, to be pursued (which shall be at the expense of the Company) if the Executive’s claim for such refund or credit is denied.

(2) In the event that the Excise Tax is later determined by the Accountant or the Internal Revenue Service to exceed the amount taken into account hereunder at the time a Tax Reimbursement Payment was made (including by reason of any payment the existence or amount of which could not be determined at the time of the earlier Tax Reimbursement Payment), the Company shall make an additional Tax Reimbursement Payment in respect of


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such excess (plus any interest or penalties payable with respect to such excess) once the amount of such excess is finally determined.

(3) In the event of any controversy with the Internal Revenue Service (or other taxing authority) under this paragraph 4, subject to the second sentence of subparagraph (1)(C) above, Executive shall permit the Company to control issues related to this paragraph 4 (at its expense), provided that such issues do not potentially materially adversely affect the Executive, but the Executive shall control any other issues. In the event the issues are interrelated, the Executive and the Company shall in good faith cooperate so as not to jeopardize resolution of either issue. In the event of any conference with any taxing authority as to the Excise Tax or associated income taxes, the Executive shall permit the representative of the Company to accompany the Executive, and the Executive and his or her representative shall cooperate with the Company and its representative.

(4) With regard to any initial filing for a refund or any other action required pursuant to this paragraph 4 (other than by mutual agreement) or, if not required, agreed to by the Company and the Executive, the Executive shall cooperate fully with the Company, provided that the foregoing shall not apply to actions that are provided herein to be at the Executive’s sole discretion.

e. The Tax Reimbursement Payment, or any portion thereof


 
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