As filed with the Securities and Exchange Commission on September 20, 1999
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 17, 1999
U S WEST, Inc.
(Formerly "USW-C, Inc.")
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
A Delaware Corporation Commission File IRS Employer Identification
(State of Incorporation) Number 1-14087 No. 84-0953188
</TABLE>
1801 California Street, Denver, Colorado 80202
(Address of principal executive offices, including Zip Code)
Telephone Number (303) 672-2700
(Registrant's telephone number, including area code)
(The Exhibits Index is located on page 2 of this report.)
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<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) The following exhibits are filed as part of this Current Report on
Form 8-K:
EXHIBIT INDEX
-------------
Exhibit Number Exhibit
- -------------- -------
Exhibit 10-G.1 Retention Agreement for the Chairman, Chief Executive
Officer and President of U S WEST, Inc., dated as of
September 7, 1999.
Exhibit 10-H.1 Form of Retention Agreement for Executive Officers of
U S WEST, Inc.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
U S WEST, Inc.
(Formerly "USW-C, Inc.")
By: /s/ THOMAS O. McGIMPSEY
----------------------------------------
Name: Thomas O. McGimpsey
Title: Assistant Secretary
Dated: September 20, 1999
EXHIBIT 10-G.1
September 7, 1999
Solomon D. Trujillo
Chief Executive Officer and President
U S WEST, Inc.
1801 California Street, Suite 5200
Denver, CO 80202
Dear Sol:
In light of the expected merger (the "Merger") of U S WEST, Inc.("Company")
and Qwest Communications International Inc. ("Qwest"), the Human Resources
Committee (the "Committee") and the Board of Directors of the Company (the
"Board") have concluded that it is in the best interests of the Company and its
stockholders to modify the terms of your current change of control agreement,
dated as of June 22, 1998 (the "Control Agreement"). The Committee and the Board
intend the modifications in this agreement (the "Retention Agreement") to
provide incentives to you to remain with the Company through the completion of
the Merger and to assume a key executive position at the post-merger company
(the "Merger Successor"). The Committee and the Board further intend that this
Retention Agreement be part of the retention and stay bonus program to which the
Company and Qwest agreed in their Merger agreement.
The Committee and the Board believe that the employment market for
experienced senior executives in the telecommunications industry is extremely
strong and that the Company is at some risk that you may react to the uncertain
times by leaving for a competitor before the Merger.
In addition, the Committee and the Board recognize that the current Control
Agreement and your other compensation arrangements may provide you with
insufficient incentives to remain during the pre-Merger period and with the
Merger Successor, particularly since the Company's many competitors could
compensate you for leaving and foregoing the benefits under the Control
Agreement. This Retention Agreement is intended to improve the likelihood that
you will remain with the Company Group (as defined below) by providing
incentives to remain with the Company Group. In exchange for this new
arrangement, you are agreeing at this time to use arbitration to settle any
disputes under the Control Agreement or this agreement, rather than retain your
current ability under the Control Agreement to choose whether the parties will
use arbitration. You are also agreeing at this time to assume an obligation not
to compete as defined in this Retention Agreement with the Company Group for a
minimum period of eighteen (18) months following your separation from employment
for any reason. The Company and you are agreeing to modify your obligation not
to compete by shortening the period in certain situations where the parties
agree that 18 months of noncompetition provides satisfactory protection for the
Company's interests and by imposing a new 18 month obligation under what the
parties agree are important additional circumstances, with the result that you
will be subject to a noncompete for 18 months if your employment ends for any
reason, without regard to whether you receive any payments under this or the
Control Agreement. You also agree and understand that you will not receive the
benefits under this Retention Agreement if you voluntarily leave employment
before the Merger is completed or within two years following completion of the
Merger except as specifically set forth below.
This Retention Agreement is intended to address these issues for the
benefit of the Company and its stockholders. It does not supersede the Control
Agreement, except as specifically indicated below. Any undefined capitalized
terms take their definitions from the Control Agreement.
<PAGE>
Term of Agreement
This Retention Agreement will begin as of August 31, 1999,
and continue in effect until August 31, 2003. It will cease
to apply if the Company and Qwest cease efforts to complete
the Merger but will again apply if those parties resume such
efforts before December 31, 2000. Termination or expiration
of this Retention Agreement does not affect any rights,
obligations, or liabilities of the Company or you that have
accrued on or before the date the Retention Agreement
terminates or expires.
Stock Options
Pursuant to the U S WEST, Inc. 1998 Stock Plan, as amended,
(the "Plan"), the Committee and the Board have approved the
grant to you of an option to purchase three million shares
of common stock, par value $.01, as a matter of separate
inducement in connection with your engagement with the
Company or the Merger Successor and as partial consideration
for the Retention Agreement, and not in lieu of salary or
other compensation for your services. The options shall not
be treated as an incentive stock option under the Internal
Revenue Code of 1986, as amended.
Timing of Stock
Option Grant
You will receive the options described above as follows: As
of August 6, 1999, you will receive an option to purchase
one million (1,000,000) shares of common stock, par value
$.01, pursuant to the terms of the Stock Option Agreement
substantially in the form of Attachment A hereto ("Initial
Grant"). As of January 3, 2000, you will receive an option
to purchase an additional two million (2,000,000) shares of
common stock, par value $.01, pursuant to the terms of the
Stock Option Agreement substantially in the form of
Attachment A hereto ("Subsequent Grant") (The Initial Grant
and the Subsequent Grant will be collectively referred to as
the "Stock Option Grant"). All options awarded pursuant to
this Retention Agreement shall become Vested (as defined in
the Plan) in one-quarter increments upon each of the first
four (4) anniversaries following the date of the Initial
Grant. The Stock Option Grant is not subject to forfeiture
as a result of or otherwise impacted by the completion of
the Merger. The exercise price of the Initial Grant shall be
the closing price of U S WEST stock as of August 6, 1999.
The exercise price of the Subsequent Grant shall be the
closing price of U S WEST stock on January 3, 2000.
Restricted Stock
Grant
The Company will award you three hundred thousand (300,000)
shares of common stock of the Company in the form of
restricted stock with a date of grant of August 6, 1999, but
conditioned on completion of the Merger ("Restricted Stock
Grant"). If, but only if, the Merger is completed, fifty
percent of the shares granted pursuant to the Restricted
Stock Grant will cease to be restricted and thus
nonforfeitable by you if you remain employed by the Merger
Successor or a Subsidiary on the second anniversary of the
date of grant. If, but only if, the Merger is completed, the
remaining fifty percent of the Restricted Stock Grant will
cease to be restricted and thus nonforfeitable in equal
increments on the third and fourth anniversaries of the date
of grant. The Restricted Stock Grant will be reflected in a
standard restricted stock agreement substantially in the
form of Attachment B hereto.
<PAGE>
Loss of Payments
You agree that you will forfeit any right to any unvested
portion of this Restricted Stock Grant and any unvested
portion of this Stock Option Grant if (i) the Company or the
Merger Successor or another member of the Company Group, as
appropriate, terminates your employment for Cause (as
defined in Section I(h) of the Control Agreement), (ii) you
voluntarily resign with or without Good Reason before
completion of the Merger, (iii) or you resign for any reason
other than an Involuntary Termination (as defined below)
prior to the second anniversary of the date of completion of
the Merger.
Discharge without
Cause
If the Company or the Merger Successor provide you with
notice of termination of your employment without Cause (as
defined in Section I.(h) of the Control Agreement) following
completion of the Merger, all unvested stock options under
the Stock Option Grant will continue to vest and the
restrictions attached to the Restricted Stock Grant will
lapse over time pursuant to the terms of the Restricted
Stock Agreement as if your employment had continued for the
full restricted period. You will have five (5) years from
the date of termination to exercise all options described
herein, and any other outstanding options, once such options
have vested, but not to exceed the term of the option. If
you receive payments set forth in this Retention Agreement
as a result of a Discharge without Cause or an Involuntary
Termination, you will not receive any additional severance
payments under any other severance agreement.
<PAGE>
Involuntary
Termination
You will be entitled to the following upon Involuntary
Termination of your employment: all unvested stock options
under the Stock Option Grant will continue to vest pursuant
to the terms of the Stock Option Agreement as if your
employment had continued for the full vesting period and the
restrictions attached to the Restricted Stock Grant will
lapse over time pursuant to the terms of the Restricted
Stock Agreement as if your employment had continued for the
full restricted period. You will have five (5) years from
the date of termination to exercise all options described
herein, and any other outstanding options once such options
have vested, but not to exceed the term of the option. You
will continue to receive the same level of use and access to
corporate aircraft as that currently provided. For purposes
of this Retention Agreement, Involuntary Termination means
your employment with the Company Group ends as a result of:
(1) your resignation after any reduction in the level of
your annual cash compensation, bonus opportunity, long term
incentive plan value, perquisites (including, but in no way
limited to, country club and health club memberships) and
benefits as of the date of execution of this Retention
Agreement (other than any benefits relating to the Change of
Control, such as the Control Agreement the Retention
Agreement or other severance agreement), including, but not
limited to, any reduction in your current level of use and
access to corporate aircraft (other than by your own choice)
in all respects similar to that currently provided; (2) your
resignation after the assignment to you of any duties
materially inconsistent with the status, title and duties
attributed to you in the Merger Agreement within two (2)
years following completion of the Merger; (3) following the
second anniversary of completion of the Merger, your
resignation for any reason unless you have obtained and then
hold the title and responsibilities of highest employee
executive position of the Merger Successor or termination of
your employment other than for Cause. Good Reason as defined
in Section I.(r.) of the Control Agreement is not applicable
for purposes of determining whether you have had an
Involuntary Termination under this Retention Agreement. In
the event that you elect to invoke your right to receive
benefits under this Retention Agreement as a result of an
Involuntary Termination, you agree to provide Notice of
Termination and to allow the Company or the Merger Successor
thirty (30) days to cure the conduct that would otherwise
give rise to such Involuntary Termination.
<PAGE>
Gross-up Payments
At the time any portion of the Restricted Stock Grant shall
become unrestricted and nonforfeitable, the Company or the
Merger Successor shall pay you an additional amount such
that the net amount retained by you with respect to the
Restricted Stock Grant, after deduction of any federal,
state and local income and employment tax and any excise tax
imposed by Section 4999 of the Internal Revenue Code of
1986, as amended (the "Code") or any other federal, state or
local excise tax (any such excise or other tax, together
with any interest and penalties, are hereinafter
collectively referred to as the "Excise Tax") and any
interest, penalties or additions to tax payable by you with
respect thereto, shall be equal to the total present value
of the Restricted Stock Grant at the time the shares become
unrestricted and nonforfeitable (the "Gross-Up Payment(s)").
The intent of the parties is that you need not sell this
stock to satisfy any tax or other obligations. The Company
or the Merger Successor shall be responsible in full for,
and shall pay, any Gross-Up Payment(s) and any and all
income and employment taxes (including, without limitation,
penalties and interest) imposed on any Gross-Up Payment(s)
and shall bear any loss of deduction caused by or related to
the Gross-Up Payment(s). The amount of the Gross-Up
Payment(s) on the Restricted Stock and the lesser of the
value of 100,000 shares of the Restricted Stock Grant or the
vested portion of the Restricted Stock Grant will be
deducted from the amount of benefits to which you may
otherwise be entitled pursuant to under Sections IV(a) and
IV(b) of the Control Agreement or any other severance
agreement to which you may be a party and you specifically
agree that this waiver overrides any contrary language in
the No Mitigation provision of Section IV(g) of the Control
Agreement. Nothing in this Retention Agreement waives any
rights you may have under the Control Agreement to receive
Gross-Up Payment(s) under Section IV(e) of the Control
Agreement, provided that you shall not be entitled to
gross-up for taxes under both agreements with respect to the
same taxes or other obligations.
Legal Fees and
Expenses
The Company or the Merger Successor will pay your reasonable
legal fees and expenses with regard to this Retention
Agreement as though it were expressly described in Section
IV(f.) of the Control Agreement.
<PAGE>
Non-compete
The Company and you agree that your non-compete obligation
under Section VII of the Control Agreement currently applies
only if you have a "Termination" as defined in Section
III(a) of the Control Agreement and thus does not apply if
you leave employment voluntarily without Good Reason more
than 90 days after a Change of Control or if you are
terminated for Cause. You further agree that this
Non-compete Agreement supercedes the non-compete provision
of Section VII of the Control Agreement unless this
Retention Agreement is terminated because the Company and
Qwest cease efforts to complete the Merger as set forth in
the Term of Agreement section of this Retention Agreement.
You agree that, for a period of 18 months following your
termination of employment with the Company or the Merger
Successor, for any reason, whether voluntary or involuntary,
you will not engage, directly or indirectly, whether as a
principal, agent, distributor, representative, consultant,
employee, partner, stockholder, limited partner, or other
investor (other than an investment of not more than (i) two
percent of the stock or equity of any corporation the
capital stock of which is publicly traded or (ii) two
percent of the ownership interest of any limited partnership
or other entity) or otherwise, within the United States of
America, in any business that is competitive (a "Competing
Business") with the "Company Group" (consisting of the
entities defined as the Controlled Group under the Control
Agreement, the Merger Successor, and any successors of any
of those entities) on the date of your termination or within
the following 18 months; solicit or entice or endeavor to
solicit or entice away from the Company Group, any person
who was an officer, employee, or sales representative of the
Company Group, whether or not such person would commit a
breach of his or her contract of employment by reason of
leaving service with those employers employ, directly or
indirectly, any person who was an officer, employee, or
sales representative of the Company Group or who by reason
of such position at any time is or may likely be in
possession of any confidential information or trade secrets
relating to the business or products of the Company Group;
or solicit or entice or endeavor to solicit or entice away
from the Company Group any customer or prospective customer
of the Company Group either for your own account or for any
individual, firm, corporation, or other entity.
You may submit a written request to the Board to reduce the
18 month term of this noncompetition obligation. The Board,
by majority vote, may grant the request, with or without
modification, or deny the request, in its sole and exclusive
discretion.
<PAGE>
"Competing Business" includes but is not limited to
first-tier long distance companies (such as MCI WorldCom,
Inc., Sprint Communications Company, L.P., and AT&T), local
exchange companies (such as the traditional RBOCs, GTE, and
independent local phone companies), new age retail
communications companies (such as Level 3 Communications,
Inc., Qwest, Global Crossing Ltd.), and new age alternative
access (such as WinStar Communications, Inc., Covad
Communications Company, and Rhythms NetConnections Inc., and
other competitive local exchange providers and digital local
connections), and internet backbone providers, but
specifically excluding companies whose primary business is
manufacturing, including manufacturers and developers of
computers and computer equipment. Examples listed above
illustrate current competitors and are representative but do
not limit the scope of any of the terms.
Incorporation by
Reference
The following provisions of the Control Agreement will apply
to this Retention Agreement as though the provisions
specifically referred to this agreement: Sections VI
(Successors; Binding Agreement); VIII (Notice); and, except
as set forth below, Sections IX (Miscellaneous) and XI
(Arbitration). The last two sentences of Miscellaneous would
instead read as follows for this Retention Agreement: "The
obligations of the Company under the Retention Benefits
section survive the expiration of the term of this Retention
Agreement, as do your obligations to comply with the
Arbitration section and with the Non-Compete section for the
period it specifies."
<PAGE>
Arbitration
You agree that the arbitration provisions of Section XI of
the Control Agreement will apply to all disputes referenced
in that section or that arise under or with respect to this
Retention Agreement. You further agree that this Retention
Agreement serves as your required written agreement to
arbitrate such matters. You therefore agree that Section XI
of the Control Agreement will apply without the need for any
further agreement by you.
If you accept the terms of this Agreement, please sign in the space
indicated below. We encourage you to consult with any advisors you choose.
U S WEST, INC.
/S/ FRANK POPOFF
-----------------------------------------
Chairman, Human Resources Committee of
the Board of Directors, for the Committee
and the Board
Accepted and agreed to:
/S/ SOLOMON D. TRUJILLO
- ---------------------------------
Solomon D. Trujillo
- ---------------------------------
Date
EXHIBIT 10-H.1
[FORM OF EXECUTIVES' RETENTION AGREEMENT]
Date
Name
Title
Address
City, State, Zip
Dear :
In light of the expected merger (the "Merger") of U S West, Inc.
("Company" and Qwest Communications International Inc. ("Qwest"), the Human
Resources Committee (the "Committee") and the Board of Directors of the Company
(the "Board") have concluded that it is in the best interests of the Company and
its stockholders to modify the terms of your current change of control
agreement, dated as of July 9, 1998 (the "Control Agreement"). The Committee and
the Board intend the modifications in this agreement (the "Retention Agreement")
to provide incentives to you to remain with the Company through the completion
of the Merger and to assume a key executive position at the post-merger company
(the "Merger Successor"). The Committee and the Board further intend that this
Retention Agreement be part of the retention and stay bonus program to which the
Company and Qwest agreed in their Merger agreement.
The Committee and the Board believe that the employment market for
experienced senior executives in the telecommunications industry is extremely
strong and that the Company is at some risk that you will react to the uncertain
times by leaving for a competitor before the Merger.
In addition, the Committee and the Board recognize that the current Control
Agreement and your other compensation arrangements may provide you with
insufficient incentives to remain during the pre-Merger period and with the
Merger Successor, particularly since the Company's many competitors could
compensate you for leaving and foregoing the benefits under the Control
Agreement. This Retention Agreement is intended to improve the likelihood that
you will remain with the Company, by providing you with partial payment of the
benefits under the Control Agreement and by adding significant new incentives to
remain with the Company. In exchange for this new arrangement, you are agreeing
at this time to use arbitration to settle any disputes under the Control
Agreement or this agreement, rather than retain your current ability under the
Control Agreement to choose whether the parties will use arbitration. You also
agree and understand that you will not receive the benefits under this Retention
Agreement if you voluntarily leave employment before the Merger is completed.
This Retention Agreement is intended to address these issues for the
benefit of the Company and its stockholders. It does not supersede the Control
Agreement, except as specifically indicated below. Any undefined capitalized
terms take their definitions from the Control Agreement.
Term of Agreement
This Retention Agreement will begin as of August 6, 1999 and
continue in effect until December 31, 2001. It will cease to
apply if the Company and Qwest cease efforts to complete the
Merger, but will again apply if those parties resume such
efforts before December 31, 2000. Termination or expiration
of this Retention Agreement does not affect any rights,
obligations, or liabilities of the Company or you that have
accrued on or before the date the Retention Agreement
terminates or expires.
Initial Retention
Benefits
If, but only if, the Merger is completed (or as provided
under Involuntary Termination below), the Company or the
Merger Successor will pay you the greater of the amount of
____________ or the standard benefit calculated as of the
day prior to the Merger under IV(a) of the Control Agreement
("Standard Benefits Cashout") in lieu of the potential
Standard Benefits under Section IV(a) of the Control
Agreement, the greater of _______________ ("Additional
Benefits Cashout") or the additional benefits calculated as
of the day prior to the Merger under IV(b) of the Control
Agreement in lieu of the Additional Benefits under Section
IV(b)of the Control Agreement, and will provide you with the
Retirement Plan Benefits and Health Plan Benefits set forth
in Section IV(a)(b)(a) and (b), and Executive Life Insurance
Benefits upon your separation from employment ("Non-cash
Benefits") (with the Standard Benefits Cashout, the
Additional Benefits Cashout and the Non-Cash Benefits
referred to below as the "Initial Retention Benefits,"
unless otherwise specifically referred to individually
herein). You and the Company agree that the benefits
provided under Section IV(b) (Additional Benefits) of the
Control Agreement are based on the rate in effect on either
(x) the day on which Notice of Termination is given, or (y)
the day immediately preceding the Change of Control,
whichever is higher and that this supercedes any provision
in the Control Agreement to the contrary. You agree that you
waive any claim to be paid the benefits under Sections
IV(a), IV(b), IV(a)(b)(a) and IV(a)(b)(a)(b) of the Control
Agreement if you receive the Initial Retention Benefits, and
you specifically agree that this waiver overrides any
contrary language in the No Mitigation provision of Section
IV(g) of the Control Agreement.
Pursuant to the U S WEST, Inc. 1998 Stock Plan, as amended,
(the "Plan"), the Committee and the Board have approved the
grant to you of an option to purchase ______________ shares
of common stock, par value $.01, as of August 6, 1999,
pursuant to the terms of the underlying Stock Option
Agreement (the "Option Grant"). All options awarded pursuant
to this Option Grant shall become Vested (as defined by the
Plan) in one-quarter increments upon each of the first four
(4) anniversaries following the date of the Option Grant.
The exercise price of the Option Grant shall be the closing
price of U S WEST stock as of August 6, 1999, which was
$54.3125.
Deferred Retention
Benefits
The Company will also pay you a deferred retention benefit
("Deferred Retention Benefit"). The Deferred Retention
Benefit will consist of _______________ shares of common
stock in the form of restricted stock of the Company,
effective immediately prior to the Merger. If, but only if,
the Merger is completed, one-half of the shares will cease
to be restricted and thus nonforfeitable by you if you
remain employed by the Merger Successor or a Subsidiary on
the second anniversary of the completion of the Merger, and
the remainder of the shares of restricted stock will cease
to be restricted and thus nonforfeitable by you if you
remain employed by the Merger Successor or a Subsidiary on
the fourth anniversary of the completion of the Merger (the
"Fourth Anniversary") ("Deferred Retention Benefits" and
with the sum of those benefits and the Initial Retention
Benefits referred to as "Total Retention Benefits"). The
Deferred Retention Benefits will be reflected in a
restricted stock agreement between you and the Company.
Timing of Payments
On or before September 30, 1999, you will receive an
opportunity to elect the timing of payments of your Initial
Retention Benefits. You will be able to elect to have the
Initial Retention Benefits paid either (i) in total, at the
Fourth Anniversary or (ii) 50% at the completion of the
Merger and 50% on the Fourth Anniversary. If the Merger
occurs, you will receive the earned portion of the Initial
Retention Benefits and Deferred Retention Benefits for which
you have qualified, if any, no later than the earlier of the
Fourth Anniversary or 30 days after the date your employment
ends for any reason. You will forfeit any unvested portion
of the Option Grant and the Deferred Retention Benefits if
the Company or the Merger Successor terminate your
employment for Cause or you resign without Good Reason.
Vested options pursuant to the Option Grant and any other
stock options you may hold, must be exercised within five
(5) years of the later of the date of vesting or termination
of employment, not to exceed the life of the option. The
portion of the Initial Retention Benefit that is not paid at
the completion of the Merger will be deemed held in phantom
stock for purposes of tracking earnings before payment or
forfeiture. Any applicable pension additur will be
calculated based upon the date of your termination of
employment for any reason.
Loss of Payments
You agree that you will not be entitled to any unearned
Initial Retention Benefits, any unvested portion of the
Option Grant or unvested Deferred Retention Benefits if (i)
the Company terminates your employment for Cause (as defined
in Section I(g) of the Control Agreement), (ii) you resign
with or without Good Reason before or as of the completion
of the Merger, (iii) or you resign without Good Reason after
the completion of the Merger.
Involuntary
Termination
If the Company provides you with notice of its termination
of your employment without Cause ("Involuntary Termination")
before completion of the Merger and the Merger occurs, you
will receive the sum _______________ of and no other
benefits under this Retention Agreement (other than the
benefit of any stock options issued under this Retention
Agreement which have become vested) or the Control Agreement
or under any other severance agreement. If, but only if, the
Merger occurs, and after the Merger occurs, the Company or
the Merger Successor provide you with notice of Involuntary
Termination before you are entitled to the Deferred
Retention Benefits or before the Option Grant is fully
vested, the Deferred Retention Benefits and the Option Grant
will continue to vest as if you had remained employed.
Resignation for
Good Reason
If you resign for Good Reason after the Merger is completed,
you will be treated as though the Company had terminated
your employment under the Involuntary Termination section.
For purposes of this Retention Agreement and the Control
Agreement, the Company and you agree that if the Merger
occurs, "Good Reason" has the meaning in Section I(q) of the
Control Agreement but with the reasons in I(q)(i) and
I(q)(ii) being measured (beginning two (2) months after the
completion of the Merger) against your position at the
Merger Successor or a Subsidiary for a period of four years
after the completion of the Merger rather than your position
at the Company before and after the Merger.
Gross-up Payments
Nothing in this Retention Agreement waives any rights you
may have under the Control Agreement to receive Gross-Up
Payment(s) under Section IV(C) of the Control Agreement.
Legal Fees and
Expenses
The Company or the Merger Successor will pay your reasonable
legal fees and expenses with regard to this Retention
Agreement as though it were expressly described in Section
IV(f) of the Control Agreement.
Incorporation by
Reference
The following provisions of the Control Agreement will apply
to this Retention Agreement as though the provisions
specifically referred to this agreement: Sections VI
(Successors; Binding Agreement); VIII (Notice); and, except
as set forth below, Sections IX (Miscellaneous) and XI
(Arbitration). The last two sentences of Miscellaneous would
instead read as follows for this Retention Agreement: "The
obligations of the Company under the Initial Retention
Benefits and Deferred Retention Benefits sections survive
the expiration of the term of this Retention Agreement, as
do your obligations to comply with the Arbitration section."
Arbitration
You agree that the arbitration provisions of Section XI of
the Control Agreement will apply to all disputes referenced
in that section or that arise under or with respect to this
Retention Agreement. You further agree that this Retention
Agreement serves as your required written agreement to
arbitrate such matters. You therefore agree that Section XI
of the Control Agreement will apply without the need for any
further agreement by you.
If you accept the terms of this Agreement, please sign in the space
indicated below. We encourage you to consult with any advisors you choose.
/S/ SOLOMON D. TRUJILLO
__________________________________
Name-CEO
Accepted and agreed to:
_________________________________
Name-Band 1
_________________________________
Date
