8-K 1 a05-21922_18k.htm CURRENT REPORT OF MATERIAL EVENTS OR CORPORATE CHANGES

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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):  December 15, 2005

 

Qwest Communications International Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

Delaware

(State or Other Jurisdiction of Incorporation)

 

001-15577

 

84-1339282

(Commission File Number)

 

(IRS Employer Identification No.)

 

 

 

1801 California Street, Denver, Colorado

 

80202

(Address of Principal Executive Offices)

 

(Zip Code)

 

(303) 992-1400

(Registrant’s Telephone Number, Including Area Code)

 

N/A

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

o                                    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o                                    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o                                    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o                                    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 



 

Item 1.01.  Entry into a Material Definitive Agreement.

 

On December 15, 2005, the Compensation and Human Resources Committee (the “Committee”) of the Board of Directors (the “Board”) of Qwest Communications International Inc. (“Qwest” or the “Company” or “we” or “us” or “our”) took the following actions:

 

                  The Committee approved the terms of the 2006 Qwest Management Bonus Plan (the “Bonus Plan”). All of our management employees in non-sales-commissioned positions who are on the payroll during 2006 and who remain on the payroll until the date that is 14 days prior to the bonus payout date are eligible to participate in the Bonus Plan. Under the Bonus Plan, bonus payments are calculated using bonus target percentages (expressed as a percentage of base salary) and are adjusted based on a combination of corporate, business unit and individual performance. Corporate and business unit performance are determined by a weighted average of a combination of measures, which may include revenue, operating margin, net income, cash flow, and customer satisfaction depending on the department in which an employee works. Performance targets for each of these measures will be approved in the first quarter of 2006. Individual performance is determined by an evaluation by the supervising manager of overall employee performance compared to established performance objectives and behaviors exhibited by the employee compared to our Qwest brand attributes and values. A summary of the Bonus Plan is attached hereto as Exhibit 10.1.

 

                  The Committee amended and restated the Qwest Deferred Compensation Plan for Nonemployee Directors (the “Deferred Compensation Plan”) to comply with changes required by Section 409A of the Internal Revenue Code (“Section 409A”) and to eliminate the 50% company match for deferred director fees.  A copy of the amended and restated Deferred Compensation Plan is attached hereto as Exhibit 10.2.

 

                  The Committee increased the annual base salaries for certain of our executive officers.  Effective as of January 1, 2006, these executive officers will receive annual base salaries as follows:

 

Name and Title

 

Annual Base Salary

 

Oren G. Shaffer, Vice Chairman and Chief Financial Officer

 

$

824,000

 

Barry K. Allen, Executive Vice President — Operations

 

$

690,000

 

Richard N. Baer, Executive Vice President and General Counsel

 

$

605,000

 

Paula Kruger, Executive Vice President — Mass Markets

 

$

472,500

 

Thomas E. Richards, Executive Vice President — Business Markets

 

$

428,000

 

 

                  The Committee approved a form of amendment to the severance agreement between us and each of Ms. Kruger and Messrs. Baer and Richards.  The amendments modify the definition of cause used in such severance agreements and make certain other changes to comply with Section 409A.  The form of amendment is attached hereto as Exhibit 10.3.

 

                  The Committee approved amendments (the “Second Amendments”) to the amended and restated employment agreements between us and each of Mr. Shaffer and Richard C. Notebaert, our Chairman and Chief Executive Officer (each, an “executive”).  As previously reported, on October 21, 2005, we entered into amendments to such employment agreements, which amendments provide that, among other things, in the event the executive resigns or retires after December 31, 2006, his vested stock options (other than those options outstanding and in-the-money on October 21, 2005) may be exercised within six years of his resignation or retirement.  The Second Amendments provide that the time extension for exercise referred to above will occur only to the extent it is not viewed as a deferral of compensation under Section 409A .  Forms of the Second Amendments are attached hereto as Exhibits 10.4 and 10.5.

 

Item 5.02.  Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

 

On December 15, 2005, the Board unanimously elected Mr. R. David Hoover, Chairman and Chief Executive Officer of Ball Corporation, as a director of Qwest effective as of December 15, 2005 and appointed Mr. Hoover to the Nominating and Governance Committee of the Board.  There is no arrangement or understanding between Mr. Hoover and any other person pursuant to which he was selected as a director.

 

On December 15, 2005, the Board unanimously elected Ms. Caroline Matthews, President of Blue Cross and Blue Shield of Georgia, as a director of Qwest effective as of December 15, 2005 and appointed Ms. Matthews to the Audit Committee of the Board.  There is no arrangement or understanding between Ms. Matthews and any other person pursuant to which she was selected as a director.

 

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Item 9.01. Financial Statements and Exhibits.

 

(c) Exhibits

 

Exhibit No.

 

Description

 

 

 

Exhibit 10.1

 

2006 Qwest Management Bonus Plan Summary

 

 

 

Exhibit 10.2

 

Deferred Compensation Plan for Nonemployee Directors, as amended and restated

 

 

 

Exhibit 10.3

 

Form of Amendment to Severance Agreement between Qwest Services Corporation and each of Richard N. Baer, Paula Kruger and Thomas E. Richards

 

 

 

Exhibit 10.4

 

Form of Amendment to Amended and Restated Employment Agreement by and between Qwest Services Corporation and Richard C. Notebaert

 

 

 

Exhibit 10.5

 

Form of Amendment to Amended and Restated Employment Agreement by and between Qwest Services Corporation and Oren G. Shaffer

 

 

 

Exhibit 99.1

 

Press Release, dated December 15, 2005

 

Forward Looking Statements Warning

 

This filing may contain projections and other forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. Readers are referred to the documents filed by us with the Securities and Exchange Commission, specifically the most recent reports which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements, including but not limited to: access line losses due to increased competition, including from technology substitution of our access lines with wireless and cable alternatives; our substantial indebtedness, and our inability to complete any efforts to de-lever our balance sheet through asset sales or other transactions; any adverse outcome of the current investigation by the U.S. Attorney’s office in Denver into certain matters relating to us; adverse results of increased review and scrutiny by regulatory authorities, media and others (including any internal analyses) of financial reporting issues and practices or otherwise; rapid and significant changes in technology and markets; any adverse developments in commercial disputes or legal proceedings, including any adverse outcome of current or future legal proceedings related to matters that are the subject of governmental investigations, and, to the extent not covered by insurance, if any, our inability to satisfy any resulting obligations from funds available to us, if any; potential fluctuations in quarterly results; volatility of our stock price; intense competition in the markets in which we compete including the likelihood of certain of our competitors consolidating with other providers or otherwise reorganizing their capital structure to more effectively compete against us; changes in demand for our products and services; acceleration of the deployment of advanced new services, such as broadband data, wireless and video services, which could require substantial expenditure of financial and other resources in excess of contemplated levels; higher than anticipated employee levels, capital expenditures and operating expenses; adverse changes in the regulatory or legislative environment affecting our business; changes in the outcome of future events from the assumed outcome included in our significant accounting policies; and our ability to utilize net operating losses in projected amounts.

 

The information contained in this filing is a statement of Qwest’s present intention, belief or expectation and is based upon, among other things, the existing regulatory environment, industry conditions, market conditions and prices, the economy in general and Qwest’s assumptions. Qwest may change its intention, belief or expectation, at any time and without notice, based upon any changes in such factors, in Qwest’s assumptions or otherwise. The cautionary statements contained or referred to in this filing should be considered in connection with any subsequent written or oral forward-looking statements that Qwest or persons acting on its behalf may issue. This filing may include analysts’ estimates and other information prepared by third parties for which Qwest assumes no responsibility.

 

Qwest undertakes no obligation to review or confirm analysts’ expectations or estimates or to release publicly any revisions to any forward-looking statements and other statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

 

By including any information in this filing, Qwest does not necessarily acknowledge that disclosure of such information is required by applicable law or that the information is material.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, Qwest has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

QWEST COMMUNICATIONS INTERNATIONAL INC.

 

 

 

 

 

 

DATE: December 16, 2005

By:

/s/ Stephen E. Brilz

 

 

 

Name:

Stephen E. Brilz

 

 

Title:

Assistant Secretary

 

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EXHIBIT INDEX

 

Exhibit No.

 

Description

 

 

 

Exhibit 10.1

 

2006 Qwest Management Bonus Plan Summary

 

 

 

Exhibit 10.2

 

Deferred Compensation Plan for Nonemployee Directors, as amended and restated

 

 

 

Exhibit 10.3

 

Form of Amendment to Severance Agreement between Qwest Services Corporation and each of Richard N. Baer, Paula Kruger and Thomas E. Richards

 

 

 

Exhibit 10.4

 

Form of Amendment to Amended and Restated Employment Agreement by and between Qwest Services Corporation and Richard C. Notebaert

 

 

 

Exhibit 10.5

 

Form of Amendment to Amended and Restated Employment Agreement by and between Qwest Services Corporation and Oren G. Shaffer

 

 

 

Exhibit 99.1

 

Press Release, dated December 15, 2005

 

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