Document:

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:

 

	
   

  	
   

  	
  Age at Retirement

  	
   

  	
  Term of Employment 

  (as defined in the 

  Qwest Pension Plan)

  
	
  Combination 1

  	
   

  	
  Any Age

  	
   

  	
  at least 30 years

  
	
  Combination 2

  	
   

  	
  50-54

  	
   

  	
  at least 25 years

  
	
  Combination 3

  	
   

  	
  55-59

  	
   

  	
  at least 20 years

  
	
  Combination 4

  	
   

  	
  60-64

  	
   

  	
  at least 15 years

  
	
  Combination 5

  	
   

  	
  65 and older

  	
   

  	
  at least 10 years

  

 

(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.

 

6

 

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.

 

	
   

  	
   

  	
  QWEST COMMUNICATIONS
  INTERNATIONAL INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
    By:

  	
   

  
	
  Date

  	
   

  	
   

  	
  Executive Vice
  President,

  
	
   

  	
   

  	
   

  	
  General Counsel and
  Chief Administrative Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  OPTIONEE:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date

  	
   

  	
   

  	
   

  
					

 

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, including cash and property of any kind,
distributed with respect to the Restricted Stock.

 

3.                                      RESTRICTIONS.

 

The Grantee shall not
sell, assign, transfer by gift or otherwise, pledge, hypothecate, or otherwise
dispose of, by operation of law or otherwise, any of the Shares for the period
commencing on the Transfer Date and ending on the Expiration Date (as defined
in Section 4 below), except as otherwise provided in Section 4 or Section 5
or as otherwise permitted by this Agreement or the terms of the Plan.

 

 

If any transfer of Shares
is made or attempted to be made contrary to the terms of this Agreement, the
Company shall have the right to acquire for its own account, without the
payment of any consideration therefor, such Shares from the owner thereof or his
transferee, at any time before or after such prohibited transfer.  In addition to any other legal or equitable
remedies it may have, the Company may enforce its rights to specific
performance to the extent permitted by law and may exercise such other equitable
remedies then available to it.  The
Company may refuse for any purpose to recognize any transferee who receives
Shares contrary to the provisions of this Agreement as a stockholder of the
Company and may retain and/or recover all dividends on such Shares that were
paid or payable subsequent to the date on which the prohibited transfer was
made or attempted.

 

4.                                      VESTING; LAPSE OF RESTRICTIONS.

 

Except as otherwise
provided in this Agreement, the Shares of Restricted Stock shall vest in
one-third installments upon each of the first three anniversaries following the
Transfer Date; provided that, with respect to each installment, the Grantee has
remained in continuous employment with the Company from the Transfer Date until
the date such installment is designated to vest.

 

The Restricted Stock
shall be fully vested and this Agreement shall terminate on the last vesting
installment date described in the paragraph immediately above (the “Expiration
Date”).  Shares that have become vested
and as to which the restrictions have lapsed shall be referred to as Vested
Shares.  Shares that have not become
vested and as to which the restrictions have not lapsed shall be referred to as
Unvested Shares.

 

Notwithstanding the
vesting schedule set forth above, the Unvested Shares will immediately become
Vested Shares in the event of the Grantee’s death or Disability, or upon a
Change in Control.

 

The Grantee may, at
Grantee’s discretion and subject to the policies of the Company, sell, assign,
transfer by gift or otherwise, hypothecate, or otherwise dispose of, by
operation of law or otherwise, any of the Vested Shares not withheld by the
Company for tax withholding purposes pursuant to Section  9.

 

5.                                      TERMINATION OF EMPLOYMENT;
FORFEITURE OF UNVESTED SHARES.

 

In the event the Grantee’s
employment with the Company is terminated for any reason other than due to
death or Disability, all Unvested Shares shall be forfeited and the Grantee
shall immediately transfer and assign to the Company, without the requirement
of consideration, all Unvested Shares, which shall promptly be tendered to the
Company by the delivery of certificates, if any, for such Unvested Shares, duly
endorsed in blank by the Grantee or the Grantee’s representative or with stock
powers attached thereto duly endorsed, at the Company’s principal offices, all
in form suitable for the transfer of such Shares to the Company without the
payment of any consideration therefor by the Company.  After the time at which any such Shares are
required to be delivered to the Company for transfer to the Company, the
Company shall not pay any dividend to the 

 

2

 

Grantee on account of
such Shares or permit the Grantee to exercise any of the privileges or rights
of a stockholder with respect to such Shares, but shall, in so far as permitted
by law, treat the Company as the owner of such Shares.

 

6.                                      ADJUSTMENT OF THE SHARES.

 

Upon the occurrence of an
event described in Article IV of the Plan, the Shares shall be adjusted in
accordance with Article IV.

 

7.                                      FORFEITURE OF UNVESTED SHARES.

 

(a)                                  Performance for Competitors. Notwithstanding any other
provision of this Agreement, Grantee shall immediately forfeit all rights under
the Restricted Stock Award, if, Grantee accepts employment with a Competitor (as
defined herein) or during the 18 month period beginning on the date of
Grantee’s termination of employment, Grantee 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 Grantee
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
detrimental to the Company. Notwithstanding the foregoing, if Grantee is an
attorney, Grantee 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, Grantee shall immediately forfeit all rights under
the Restricted Stock Award, if, during the one-year period beginning on the
date of Grantee’s termination of employment, Grantee induces any employee of
Qwest to leave Qwest’s employment, and if the Company, in its sole discretion,
determines that such actions by Grantee are detrimental to the Company.

 

(c)                                  Nondisclosure. Grantee 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
Grantee’s employment with the Company. Grantee will not disclose to anyone or
make any use of any Confidential Information of the Company after Grantee’s
employment with the Company ends for any reason, except as required by law
after timely notice is given by Grantee to the Company. This agreement not to
disclose or use Confidential Information means, among other things, that
Grantee, for a period of 18 months beginning on the effective date of the
termination of Grantee’s employment with the Company or any other Qwest entity
for any reason, may not 

 

3

 

take or perform a job whose
responsibilities would likely lead Grantee to disclose or use Confidential
Information. Grantee 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 Grantee’s employment with
the Company, Grantee 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
Grantee owes a duty of confidence or nondisclosure of such information. If a
court determines that this provision is too broad, Grantee 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” is 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 Grantee of any
obligations Grantee has to the Company under law. If Grantee fails to comply
with the provisions of this paragraph 7(c), Grantee shall immediately forfeit
all rights under the Restricted Stock Award if the Company, in its sole discretion, determines
that such actions by Grantee are, or were, detrimental to the Company.  Nothing in this paragraph shall prevent or
limit Grantee’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, Grantee shall immediately forfeit all rights under
the Restricted Stock Award and shall repay to Company all proceeds from the
vesting or lapsing of the Award occurring after Grantee’s termination of
employment, if, within the two-year period beginning on Grantee’s termination
date, the Company determines that Grantee, while employed by Company, engaged
in conduct constituting Cause (as defined by any employment agreement between
Company and Grantee, or if there is no employment agreement, as defined by the
Plan).  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 Grantee (or, if
applicable, Grantee’s estate or beneficiary) received Company’s written
notification of its determination that such Cause exists or existed, and shall
continue to accrue until complete repayment is made to Company.   This provision shall not be effective
after a Change in Control (as defined in Section 5.4(b) of the Plan).

 

4

 

8.                                       ENFORCEMENT OF RESTRICTIONS.

 

If a certificate or
certificates representing Shares is issued, it shall bear the following legend:

 

“The Shares of
stock represented by this Certificate are subject to all of the terms of a
Restricted Stock Agreement between Qwest Communications International Inc. and
the registered owner of this Certificate (the “Agreement”) and to the terms of
the Qwest Communications International Inc. Equity Incentive Plan.  Copies of the Agreement and the Plan are on
file at the office of the Company.  The
Agreement, among other things, limits the right of the Owner to transfer the
Shares represented hereby and provide in certain circumstances that all or a
portion of the Shares must be returned to the Company.”

 

The Company may, in its
sole discretion, require the Grantee to keep the certificate, if any,
representing the Unvested Shares, duly endorsed, in the custody of the Company
while the Unvested Shares are subject to the restrictions contained in Section 2.  The Company may, in its sole discretion,
require that the certificate, if any, representing the Unvested Shares, duly
endorsed, be held in the custody of a third party while the Unvested Shares are
subject to the restrictions contained in Section 3.

 

The Company’s Insider Trading
Policy 110 requires that all Insiders must pre-clear with the Law Department
all proposed transactions in Qwest Securities prior to transaction.

 

9.                                      TAX WITHHOLDING.

 

Notwithstanding any Plan
provision to the contrary, upon the vesting of any portion of the Shares, the
Company shall withhold from the Vested Shares a number of Shares having a value
equal to the minimum amount required to be withheld under applicable federal,
state and local income and other tax laws (collectively, “Withholding Taxes”).  In such case, the value of the Shares to be
withheld shall be based on the closing price of the Company’s common stock as
reported on the New York Stock Exchange on the date the amount of the
Withholding Taxes is determined (the “Tax Date”).

 

10.                               BINDING EFFECT.

 

This Agreement shall be
binding upon the heirs, executors, administrators and successors of the parties
hereto.

 

11.                               WAIVER OF RIGHT TO JURY.

 

By signing this
Agreement, Grantee 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 Grantee’s employment with Company.  The Company also hereby voluntarily,
knowingly, and intelligently waives any right it might otherwise have to a 

 

5

 

jury trial for all claims
relating to this Agreement and any other claim relating to Grantee’s employment
with the Company.

 

12.                               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.

 

13.                               HEADINGS.

 

Headings are for the
convenience of the parties and are not deemed to be part of this Agreement.

 

14.                               EXECUTION.

 

This Agreement is
voidable by the Company if the Grantee 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 Transfer Date.

 

	
   

  	
   

  	
  QWEST COMMUNICATIONS
  INTERNATIONAL INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Executive Vice
  President,

  
	
   

  	
   

  	
   

  	
  General Counsel and
  Chief Administrative Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GRANTEE:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  

 

6

 

PERFORMANCE
SHARE AGREEMENT

 

This Performance Share
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 an Award to the Grantee subject to the terms and
conditions herein.

 

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.

 

2.                                      GRANT OF PERFORMANCE SHARES.

 

(a)                                  Performance Shares.  The
Company hereby grants to the Grantee
         Performance Shares on
                
    , 20     (the “Grant Date”).  Except as provided below, the Performance
Shares will be unvested and forfeitable.

 

(b)                                 Performance Period.  The “Performance
Period” begins on
                            ,
and ends on the earlier of (i)                         
or (ii) the closing date of a Change in Control.

 

(c)                                  Vesting of Performance Shares.  Except
as provided in paragraph 3(c) below,  the
Performance Shares will vest on the last day of the Performance Period provided
that the Grantee remains employed with the Company for the entire Performance
Period.

 

(d)                                 Performance Payout.  As
soon as practicable after the end of the Performance Period, the Company will
calculate the percentage, if any, of the Performance Shares to be paid out
pursuant to the formula set forth in Exhibit 1, hereto.

 

(e)                                  Settlement in Shares or Cash.  The amount payable
to the Grantee for the Grantee’s vested Performance Shares, as adjusted as
described in the formula set forth in Exhibit 1,  may be paid either in shares of Common Stock
par value $0.01 per share, of the Company (“Common Stock”), in cash based on
the fair market value of the Common Stock, (determined based on the closing
price for the Common Stock on the last day of the Performance Period, as
reported on the New York Stock Exchange), as elected by Grantee in writing
except that cash shall be 

 

 

distributed
in lieu of any fractional share of Common Stock or if no election is made.   Each Performance Share is equal to one share
of Common Stock.  An election to be paid
in Common Stock is subject to Qwest’s Insider Trading Policy.

 

(f)                                    Payment Date.  Settlement pursuant to paragraph 2(e) will
occur within five business days after the end of the Performance Period.

 

3.                                      TERMINATION OF EMPLOYMENT DURING
PERFORMANCE PERIOD.

 

(a)                                  Resignation or Retirement.  In the event Grantee
resigns or retires his or her employment with the Company during the
Performance Period all Performance Shares and rights thereto will be forfeited
and canceled immediately upon such termination of employment and the Grantee
will have no further rights under this Agreement with respect to such
Performance Shares.

 

(b)                                 Involuntary
Termination of Employment With or Without
Cause.  In the event the
Grantee’s employment with the Company is involuntarily terminated during the
Performance Period without Cause (as defined by any employment agreement
between Company and Grantee, or if there is no employment agreement, as defined
by the Plan) or during or after the Performance Period for Cause, all
Performance Shares and rights thereto will be forfeited and canceled immediately
upon such termination of employment and the Grantee will have no further rights
under this Agreement with respect to such Performance Shares.

 

(c)                                  Termination Because Grantee Dies or Becomes
Disabled.  In the event the Grantee’s employment with
the Company is terminated during the Performance Period due to the Grantee’s
death or Disability, the Grantee’s Performance 
Shares shall immediately vest. 
The Company will determine the total amount, if any, to be paid to the
Grantee for such vested Performance Shares at the end of the Performance Period
as set forth in paragraph 2(d) of this Agreement.  The amount paid to Grantee will be prorated
based on the ratio of the number of months the Grantee was employed during the
Performance Period to the total number of months in the Performance
Period.  Partial months or employment
will be counted as full months for the purposes of this paragraph.  Payment for the vested Performance Shares will
be made as provided in paragraphs 2(e) and (f).

 

(d)                                 Termination of Employment After Performance
Period.  In
the event the Grantee’s employment with the Company is terminated after the end
of the Performance Period for any reason other than for Cause, but before
payment has been made, the Performance Shares shall be payable as provided
herein as if such termination had not occurred.

 

4.                                      ADJUSTMENT OF PERFORMANCE SHARES.

 

Upon the occurrence of an
event described in Article IV of the Plan, the number of Performance
Shares granted herein shall be adjusted in accordance with Article IV.

 

2

 

5.                                      FORFEITURE OF PERFORMANCE SHARES.

 

(a)                                  Performance for
Competitors.  Notwithstanding any other provision of
this Agreement, Grantee shall immediately forfeit all Performance Shares
(whether or not vested) and all rights under this Agreement if, prior to the
payment of the Performance Shares, Grantee accepts employment with a Competitor
(as defined herein) or Grantee 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 Grantee
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
detrimental to the Company. 
Notwithstanding the foregoing, if Grantee is an attorney, Grantee 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
the Company or sells goods or services similar to those the Company sells.

 

(b)                                 Non-solicitation of
Employees.  Notwithstanding any other provision of
this Agreement, Grantee shall immediately forfeit all Performance Shares
(whether or not vested) and all rights under this Agreement if, prior to the
payment of the Performance Shares, Grantee induces any employee of the Company
to leave the Company’s employment, and if the Company, in its sole discretion,
determines that such actions by Grantee are detrimental to the Company.

 

(c)                                  Nondisclosure.  Grantee 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 Grantee’s
employment with the Company.  Grantee
will not disclose to anyone or make any use of any Confidential Information of
the Company after Grantee’s employment with the Company ends for any reason,
except as required by law after timely notice is given by Grantee to the
Company.  This agreement not to disclose
or use Confidential Information means, among other things, that Grantee, for a
period of 18 months beginning on the effective date of the termination of
Grantee’s employment with the Company, or any subsidiary or parent of the
Company, for any reason, may not take or perform a job whose responsibilities
would likely lead Grantee to disclose or use Confidential Information.  Grantee 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 Grantee’s employment with
the Company, Grantee 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
Grantee owes a duty of confidence or nondisclosure of such 

 

3

 

information.  If
a court determines that this provision is too broad, Grantee 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” is 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 Grantee of
any obligations Grantee has to the Company under law.  If Grantee fails to comply with the
provisions of this paragraph 5(c), Grantee shall immediately forfeit all
Performance Shares and all rights under this Agreement if the Company, in its
sole discretion, determines that such actions by Grantee are, or were,
detrimental to the Company.  Nothing in
this paragraph shall prevent or limit Grantee’s ability to provide truthful
responses to legitimate inquiries from governmental agencies.

 

6.                                      TRANSFERABILITY OF PERFORMANCE
SHARES.

 

The Grantee may not
voluntarily or involuntarily pledge, hypothecate, assign, sell or otherwise
transfer any Performance Shares held by the Grantee, except by will or the laws
of descent and distribution, and during the Grantee’s lifetime, payment for the
Performance Shares shall be made only to the Grantee.

 

7.                                      NO RIGHTS AS A SHAREHOLDER.

 

The Grantee shall have no
rights as a shareholder with respect to any shares of Common Stock that may be
payable for the Performance Shares until the Grantee becomes a holder of record
of those shares.  No adjustments, other
than as provided in Article IV of the Plan, shall be made for dividends
(ordinary or extraordinary and whether in cash, securities or other property)
or distributions for which the record date is prior to the date on which the
Grantee becomes the holder of record of the shares of Common Stock.

 

8.                                      REGISTRATION; GOVERNMENTAL
APPROVAL.

 

The grant of Performance
Shares hereunder is subject to the requirement that, if at any time the Company
determines, in its discretion, that the listing, registration, or qualifications
of shares of Common Stock issuable upon payment for the Performance Shares 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 shares of Common Stock, no shares shall be issued, in
whole or in part, unless such 

 

4

 

listing, registration,
qualification, consent or approval has been effected or obtained free of any
conditions or with such conditions as are acceptable to the Company.

 

9.                                      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 vesting of and payment for the
Performance Shares.  Notwithstanding any
Plan provision to the contrary, upon the issuance of any shares of Common Stock
for the Performance Shares pursuant to paragraph 2(e), above, the Company shall
withhold from those shares a number of shares having a value equal to the
minimum amount required to be withheld under applicable federal, state and
local income and other tax laws (collectively, “Withholding Taxes”). In such
case, the value of the Shares to be withheld shall be based on  the closing market price of the Common
Stock on the date the amount of the Withholding Taxes is determined.

 

10.                               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
Performance Shares shall be final, binding and conclusive on the Company, the
Grantee and any respective heir, executor, administrator, successor or assign.

 

11.                               BINDING EFFECT.

 

This Agreement shall be
binding upon the heirs, executors, administrators and successors of the parties
hereto.

 

12.                               WAIVER OF RIGHT TO JURY.

 

By signing this Agreement,
Grantee 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 Grantee’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 Grantee’s
employment with the Company.

 

13.                               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.

 

5

 

14.                               HEADINGS.

 

Headings are for the
convenience of the parties and are not deemed to be part of this Agreement.

 

15.                               EXECUTION.

 

This Agreement is voidable
by the Company if the Grantee does not execute the Agreement within 30 days of
execution by the Company.

 

16.                               COMPLIANCE WITH SECTION 409A OF THE INTERNAL REVENUE CODE.

 

To the extent applicable,
the provisions of this Agreement shall be read consistent with Section 409A
of the Internal Revenue Code and the final Treasury Regulations issued
thereunder.  Payments for Performance Shares shall not be accelerated
except as expressly permitted under Code Section 409A or the final
regulations issued thereunder.

 

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.

 

	
   

  	
   

  	
  QWEST COMMUNICATIONS
  INTERNATIONAL INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Executive
  Vice President,

  
	
   

  	
   

  	
   

  	
  General
  Counsel and Chief Administrative Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GRANTEE:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  

 

6

 

EXHIBIT 1

 

PERFORMANCE TARGETS and CALCULATION OF PAYOUTS

 

The
percentage, if any, of the vested Performance Shares that will be paid to the
Grantee in accordance with, and subject to the terms and conditions of, the
Agreement will be calculated as follows (rounded to a full basis point):

 

[(Average
Qwest TSR Percentage - Average Telecom Peer TSR Percentage) x 5] + 100%;

 

provided, however,  that
the maximum percentage of the vested Performance Shares that will be paid to
the Grantee is 200%.  The table below is
provided only as an example of the calculation above:

 

	
  If the Average Qwest TSR

  Percentage minus the

  Average Telecom Peer TSR

  Percentage equals:

  	
   

  	
  Then the percentage of the

  vested Performance Shares

  that will be paid to the

  Grantee will be:

  	
   

  
	
  20% or more

  	
   

  	
  200

  	
  %

  
	
  10%

  	
   

  	
  150

  	
  %

  
	
  0%

  	
   

  	
  100

  	
  %

  
	
  -10%

  	
   

  	
  50

  	
  %

  
	
  -20% or less

  	
   

  	
  0

  	
  %

  

 

For purposes of the calculation above:

 

1.               “Average Qwest TSR Percentage” is the percentage increase or
decrease in (a) the average of the closing market price of one share of
Common Stock (as adjusted for all dividends paid, assuming they are reinvested
on the applicable payment dates) on each trading day in the Measurement Period,
as compared to (b) the closing market price of one share of Common Stock
on the first day of the Performance Period.

 

2.               “Average Telecom Peer TSR Percentage” is calculated as
follows:

 

(a)          For
each company in the Telecom Peer Group, calculate the percentage increase or
decrease in (i) the average of the closing market price of one share of
the company’s common stock (as adjusted for all dividends paid, assuming they
are reinvested on the applicable payment dates) on each trading day in the
Measurement Period, as compared to (ii) the closing market price of one
share of the company’s common stock on the first day of the Performance Period;
and

 

(b)         Calculate
the average of the percentages calculated under paragraph 2(a) above.

 

3.               “Measurement Period” is the 60 consecutive trading days on
the New York Stock Exchange ending on the last day of the Performance Period
(or the immediately preceding trading day if the last day of the Performance
Period is not a trading day); provided, however,
that in the event of a Change in Control the “Measurement
Period” is only the closing date of the Change in Control.

 

4.               “Telecom Peer Group” is AT&T, CenturyTel, Cincinnati
Bell, Citizens Communications Company, Embarq, Verizon and Windstream Communications.   The definition of the Telecom Peer Group is
subject to change in the sole and exclusive discretion of the Committee should
one or more members of the Telecom Peer Group cease to be in existence or undergo
a material change in its business.Exhibit 10.4

 

AMENDMENT TO SEVERANCE AGREEMENT

 

This Amendment to the
Severance Agreement entered into September 8, 2003 and previously amended
on December 15, 2005 (collectively, the “Severance Agreement”) between
Paula Kruger (“Executive”)  and Qwest Services
Corporation, nka Qwest Corporation (“Company”) is made and entered into on September       ,
2008, between the Executive and Company.

 

WITNESSETH THAT:

 

Whereas, THE PARTIES
PREVIOUSLY ENTERED INTO a Severance Agreement pertaining to the employment of
the Executive by the Company; and

 

WHEREAS, the parties desire
to amend the Severance Agreement in certain respects as set forth herein;

 

NOW, THEREFORE, in
consideration of Executive’s agreement to sign the Waiver and Release Agreement
attached to her Severance Agreement as Attachment A (“Waiver”) and the mutual
covenants and agreements set forth below, the Executive and Company hereby
amend the Severance Agreement as follows:

 

1.             The definition of “Standard
Severance Amount,” in paragraph 3.b(1) is amended by adding the following
sentence at the end of the paragraph:

 

Company
will pay up to $20,000 for outplacement services by a vendor of Executive’s
choice, through December 31, 2009. 
Company will pay the vendor directly. 
All requests for payment must be made by the vendor by October 31,
2009 in order to ensure that payment is completed by December 31, 2009.

 

2.             The Severance
Agreement remains in full force and effect, including the requirement that
Executive sign the Waiver in order to be eligible for any severance benefits,
including the outplacement services included in paragraph 1, above.

 

	
   

  	
  QWEST
  CORPORATION:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Edward
  A. Mueller

  	
  Date

  
	
   

  	
  Chief
  Executive Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  EXECUTIVE:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Paula
  Kruger

  	
  Date

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