{"id":40151,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/non-qualified-stock-option-agreement-qwest-communications.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"non-qualified-stock-option-agreement-qwest-communications","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/non-qualified-stock-option-agreement-qwest-communications.html","title":{"rendered":"Non-Qualified Stock Option Agreement &#8211; Qwest Communications International Inc. and Joseph P. Nacchio"},"content":{"rendered":"<pre>                        NON-QUALIFIED STOCK OPTION AGREEMENT\n\nThis Option Agreement (the 'Agreement') is made as of the 13th day of August, \n1999, between Qwest Communications International Inc., a Delaware corporation \n(the 'Company'), and Joseph P. Nacchio (the 'Optionee').\n\nWHEREAS, pursuant to the Qwest Communications International Inc. Equity \nIncentive Plan, as amended and restated, effective June 1, 1998 (the 'Plan'), \nthe Company desires to afford the Optionee the opportunity to purchase shares \nof Stock (the 'Common Shares').\n\nNOW, THEREFORE, in connection with the mutual covenants hereinafter set forth \nand for other good and valuable consideration, the receipt and adequacy of \nwhich is hereby acknowledged, the parties hereto agree as follows:\n\n1.   DEFINITIONS:  CONFLICTS.\n\nCapitalized terms used and not otherwise defined herein shall have the \nmeanings given thereto in the Plan.  The terms and provisions of the Plan are \nincorporated herein by reference.  Except as specifically otherwise provided \nherein, in the event of a conflict or inconsistency between the terms and \nprovisions of the Plan and the terms and provisions of this Agreement, the \nterms and provisions of the Plan shall govern and control.\n\n2.   GRANT OF OPTIONS.\n\nThe Company hereby grants to the Optionee the right and option to purchase up \nto (a) 8,500,000 Common Shares (the 'First Option'), on the terms and \nconditions herein set forth, and (b) 500,000 Common Shares (the 'Second \nOption'), on the terms and conditions set forth herein.  The First Option and \nthe Second Option are collectively referred to as the 'Options.'  \n\n3.   PURCHASE PRICE.\n\nThe purchase price of each Common Share covered by each Option shall be \n$28.50 (the 'Purchase Price').\n\n4.   TERM OF OPTIONS.\n\nThe term of each Option shall be ten (10) years from the date hereof, subject \nto earlier termination as provided in Section 6 hereof.\n\n                                       1\n\n\n5.   VESTING OF OPTIONS.\n\nEach Option, subject to the terms, conditions and limitations contained \nherein, shall vest and become fully exercisable with respect to all the \nCommon Shares on May 13, 2009, provided the Optionee has remained in \ncontinuous employment with the Company from the date hereof through May 13, \n2009.  However, upon the closing of the merger contemplated by the Agreement \nand Plan of Merger dated as of July 18, 1999, between the Company and U S \nWEST, Inc. as amended as of the date hereof and as the same may be further \namended, restated or modified, between U S WEST, Inc., and the Company (the \n'Transaction'), each Option shall vest and become exercisable in installments \nas set forth in the table below, provided that (i) with respect to each such \ninstallment, the Optionee has remained in continuous employment with the \nCompany from the date hereof through the date such installment is designated \nto vest and (ii) the Second Option shall not vest and become exercisable, in \nwhole or in part, until the 30th consecutive trading day on which the \npublished closing price of the Common Shares shall be not less than $45 per \nshare for each of 30 consecutive trading days ending on or before the date \nthat is the second anniversary of the closing (the 'Closing') of the \nTransaction (the 'Price Target') (it being understood that, effective on such \n30th consecutive trading day on which the published closing price of the \nCommon Shares shall be not less than $45 per share (the 'Second Option \nEffective Date') and subject to the other terms and conditions hereof, the \nSecond Option shall vest and become exercisable in accordance with the \nvesting schedule below):\n\n     (a)  with respect to the First Option:\n\n\n<font size=\"2\">\n          Anniversary of Option Grant        Cumulative Shares Vested\n                                          \n          First                              2,125,000\n          Second                             4,250,000\n          Third                              6,375,000\n          Fourth                             8,500,000;\n<\/font>\n\n     (b)  with respect to the Second Option:\n\n\n<font size=\"2\">\n          Anniversary of Option Grant        Cumulative Shares Vested\n                                          \n          First                              125,000\n          Second                             250,000\n          Third                              375,000\n          Fourth                             500,000.\n<\/font>\n\nIf the Transaction closes and the Optionee's employment with the Company is \nterminated by the Company after the closing of the Transaction for any reason \nother than cause or if the Optionee terminates his employment for good reason \nafter the Closing, the Optionee shall vest in one-twelfth (1\/12) of the \nnumber of Common Shares covered by each Option that would otherwise vest on \nthe next anniversary of the date of the grant for each full month elapsed \nfrom the immediately preceding anniversary date on which shares shall have \nvested (or, if the date of termination shall occur before the first \nanniversary date, \n\n                                       2\n\n\nfrom the date of the grant) to the date of termination, except that if Philip \nF. Anschutz is not a director of the Company on the date of such termination \nthen the First Option shall vest in full and become immediately exercisable \non the date of such termination and the Second Option shall vest in full on \nthe Second Option Effective Date (if the same shall occur or have occurred on \nor before the second anniversary of the date of the Closing).  If, at any \ntime the number of Common Shares that are covered by the vested portion of \nthe Options includes a fractional share, the number of Common Shares as to \nwhich the Options shall be actually vested shall be rounded down to the next \nwhole Common Share.\n\nNotwithstanding the vesting schedule set forth above and the provisions of \nthe Plan governing the terms of the Options, (a) if the Optionee's employment \nwith the Company shall terminate before the Closing because of his death or \nDisability, then the First Option shall vest in full and become exercisable \non the date of the Closing (if the Closing shall occur) and the Second Option \nshall vest in full and become immediately exercisable on the Second Option \nEffective Date (if the Second Option Effective Date shall occur or have \noccurred on or before the second anniversary of the date of the Closing) and \n(b) if the Optionee's employment with the Company shall terminate after the \nClosing because of his death or Disability, the First Option shall vest in \nfull and become immediately exercisable on the date of his death or such \nDisability termination and the Second Option shall vest in full and become \nimmediately exercisable on the later of the Second Option Effective Date (if \nthe Second Option Effective Date shall occur or have occurred on or before \nthe second anniversary of the date of the Closing) and his death or \nDisability termination.  For avoidance of doubt, if the Transaction does not \nclose, neither Option shall vest if the Optionee dies, is terminated as a \nresult of Disability or otherwise is terminated or ceases for any reason \nwhatsoever to be continuously employed by the Company prior to May 13, 2009.\n\n6.   TERMINATION OF EMPLOYMENT.\n\n     (a)  Except as set forth in the Plan, in the event the Optionee's\n          employment with the Company is terminated for reasons other than due\n          to death, Disability or cause, each Option that shall be or become\n          exercisable shall be exercisable until the later of February 13, 2005\n          and the date that is 18 months after the date of termination.  In the\n          event the Optionee's employment with the Company terminates by reason\n          of death or Disability before or after the Closing, each Option that\n          shall then be or become exercisable shall be exercisable until the\n          later of February 13, 2005 and the date that is 18 months after his\n          death or Disability termination. In the event the Optionee's\n          employment with the Company is terminated by the Company for cause,\n          each Option that shall then be exercisable shall be exercisable until\n          the date that is 6 months after the day following such termination. \n          Upon any cessation of the Optionee's employment with the Company for\n          any reason, including termination for cause, each Option shall lapse\n          as to any Common Shares for which it has yet to become exercisable as\n          of the date of cessation of employment, except to the extent (a) that\n          any Option shall become exercisable upon the death or Disability\n\n                                       3\n\n\n          termination of the Optionee as provided in this Agreement and (b)\n          expressly provided to the contrary in this Agreement.\n     \n     (b)  As used in this Agreement, the 'Company' shall include any Affiliated\n          Corporation of the Company.\n\n     (c)  As used in this Agreement, 'cause,' 'good reason' and 'Disability\n          termination' shall have the same meanings as in the Optionee's\n          Employment Agreement dated December 21, 1996, as amended as of the\n          date hereof (the 'Employment Agreement').\n     \n7.   CHANGE OF CONTROL.\n\n     (a)  As used in this Agreement, 'change of control' shall have the meaning\n          set forth in the Plan. For avoidance of doubt, the Transaction shall\n          not constitute a change of control for purpose of the Options, and\n          only transactions consummated following the close of the Transaction\n          shall constitute a change of control for purposes of the Options.\n\n     (b)  In the event there is both a change of control and a subsequent\n          termination of the Optionee's employment with the Company (i) by the\n          Company for reasons other than cause or (ii) by the Optionee for good\n          reason (provided that the occurrence of a change of control shall not\n          constitute good reason), in each case following a change of control,\n          the Options shall vest in full and become immediately exercisable on\n          the date of such termination, and shall remain vested and exercisable\n          during the remaining term thereof.  The provisions of this Section 7\n          shall apply only if a change of control occurs following the closing\n          of the Transaction.\n\n8.   TRANSFERABILITY OF OPTION.\n\nExcept to the extent permitted by the Committee in accordance with the \nprovisions of the Plan, the Optionee may not voluntarily or involuntarily \npledge, hypothecate, assign, sell or otherwise transfer the Options except by \nwill or the laws of descent and distribution, and during the Optionee's \nlifetime, the Options shall be exercisable only by the Optionee.\n\n9.   NO RIGHTS AS A STOCKHOLDER.\n\nThe Optionee shall have no rights as a stockholder with respect to any Common \nShares until the date of issuance to the Optionee of a certificate evidencing \nsuch Common Shares.  No adjustments, other than as provided in Article IV of \nthe Plan, shall be made for dividends (ordinary or extraordinary, whether in \ncash, securities or other property) or distributions for which the record \ndate is prior to the date the certificate for such Common Shares is issued.  \nSubject to the foregoing, the terms of the Options (including the Price \nTarget of $45 per share for the Second Option) shall be adjusted in the event \nof any stock split, stock dividend or other similar recapitalization.\n\n                                       4\n\n\n10.  REGISTRATION:  GOVERNMENTAL APPROVAL.\n\nEach Option granted hereunder is subject to the requirement that, if at any \ntime the Committee determines, in its discretion, that the listing, \nregistration, or qualifications of Common Shares issuable upon exercise of \nthe Option is required by any securities exchange or under any state or \nFederal law, rule or regulation, or the consent or approval of any \ngovernmental regulatory body or other person is necessary or desirable as a \ncondition of, or in connection with, the issuance of Common Shares, no Common \nShares shall be issued, in whole or in part, unless such listing, \nregistration, qualification, consent or approval has been effected or \nobtained free of any conditions or with such conditions as are acceptable to \nthe Committee.\n\n11.  METHOD OF EXERCISING OPTION.\n\nSubject to the terms and conditions of this Agreement, each Option may be \nexercised by written notice to the Company,  Attention: Manager, Stock \nAdministration.  Such notice shall state the election to exercise any Option \nand the number of Common Shares in respect of which the Option is being \nexercised, shall be signed by the person or persons so exercising the Option \nand shall be accompanied by payment in full of the Purchase Price for such \nCommon shares.\n\nPayment of such Purchase Price shall be made in United States dollars by \ncertified check or bank cashier's check payable to the order of the Company \nor by wire transfer to such account as may be specified by the Company for \nthis purpose.  Subject to such procedures and rules as may be adopted from \ntime to time by the Committee, the Optionee may also pay such Purchase Price \nby (i) tendering to the Company Common Shares with an aggregate Fair Market \nValue on the date of exercise equal to such Purchase Price provided that such \nCommon Shares must have been held by the Optionee for more than six (6) \nmonths, (ii) delivery to the Company of a copy of irrevocable instructions to \na stockbroker to sell Common Shares or to authorize a loan from the \nstockbroker to the Optionee and to deliver promptly to the Company an amount \nsufficient to pay such Purchase Price, or (iii) any combination of the \nmethods of payment described in clauses (i) and (ii) and in the preceding \nsentence.  The certificate for Common Shares as to which the Option shall \nhave been so exercised shall be registered in the name of the person or \npersons so exercising the Option.  All Common Shares purchased upon the \nexercise of any Option as provided herein shall be fully paid and \nnon-assessable.\n\n12.  INCOME TAX WITHHOLDING.\n\nThe Company may make such provisions and take such steps as it may deem \nnecessary or appropriate for the withholding of all federal, state, local and \nother taxes required by law to be withheld with respect to the exercise of \nany Option and the issuance of the Common Shares, including, but not limited \nto, deducting the amount of any such withholding taxes from any other amount \nthen or thereafter payable to the Optionee, or requiring the Optionee, or the \nbeneficiary or legal representative of the Optionee, to pay to the \n\n                                       5\n\n\nCompany the amount required to be withheld or to execute such documents as \nthe Company deems necessary or desirable to enable it to satisfy its \nwithholding obligations.\n\n13.  NON-QUALIFIED STOCK OPTION.\n\nThe Option granted hereunder is not intended to be an 'incentive stock \noption' within the meaning of Section 422 of the Code.\n\n14.  BINDING EFFECT.\n\nThis Agreement shall be binding upon the heirs, executors, administrators and \nsuccessors of the parties hereto.\n\n15.  GOVERNING LAW.\n\nThis Agreement shall be construed and interpreted in accordance with the laws \nof the State of Delaware.\n\n16.  HEADINGS.\n\nHeadings are for the convenience of the parties and are not deemed to be part \nof this Agreement.\n\n17.  EXECUTION.\n\nThis Agreement is voidable by the Company if the Optionee does not execute \nthe Agreement within 30 days of execution by the Company.\n\n                                       6\n\n\nIN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the \ndate and year first written above.\n\n\nQWEST COMMUNICATIONS INTERNATIONAL INC.\n\n\n\nBy:   \/s\/ Philip F. Anschutz\n   -------------------------------\n      Philip F. Anschutz\n      Chairman of the Board\n\n\nOPTIONEE:\n\n\n\/s\/ Joseph P. Nacchio\n----------------------------------\nJoseph P. Nacchio\n\n\n                                       7\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8630],"corporate_contracts_industries":[9519],"corporate_contracts_types":[9539,9544],"class_list":["post-40151","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-qwest-communications-international-inc","corporate_contracts_industries-telecommunications__telephone","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40151","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40151"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40151"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40151"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40151"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}