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EXHIBIT 10ae
U S WEST, INC.
EXECUTIVE SHORT-TERM INCENTIVE PLAN
Section 1
PURPOSE
The purpose of the U S WEST, Inc. Executive Short-Term Incentive Plan
(the "Plan") is to provide key executives of U S WEST, Inc. and its
subsidiaries (the "Company") with incentive compensation based upon the
achievement of established performance goals.
Section 2
ELIGIBILITY
Eligibility for the Plan is limited to the Chief Executive Officer of
U S WEST, Inc. and any individuals employed by the Company (at the end of any
calendar year) who appear in the Summary Compensation Table of the Company's
Proxy Statement to Shareholders for that year. The Human Resources Committee of
the U S WEST Board of Directors (the "Committee") shall certify eligibility
for participation. Individuals eligible to participate in the Plan are herein
called "Participants."
Section 3
AWARDS
Participants will be eligible to receive equal shares of a cash bonus
pool established annually, as described in Section 5, provided that the
Committee shall have the authority to reduce the share of any participant to
the extent it deems appropriate. Any such reduction of a participant's share
will not result in an increase of another participant's share.
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Section 4
PERFORMANCE PERIODS
Each performance period ("Period") shall have a duration of one
calendar year, commencing on January 1, and terminating on December 31.
Section 5
PERFORMANCE FORMULA
5.1 At the end of each Period the Committee will certify the
amount of the cash bonus pool pursuant to Section 5.2.
5.2 The cash bonus pool for any Period will be 0.25% (one-quarter
of one percent) of Cash Provided by Operating Activities for U S WEST, Inc. and
its consolidated subsidiaries, determined in accordance with the standards of
the Financial Accounting Standards Board, less any amount that the Committee
deems appropriate. In the event that the Committee elects to reduce the cash
bonus pool to an amount that is less than 0.25% of Cash Provided by Operating
Activities, the amount by which the pool is reduced may, at the Committee's
sole discretion, be added to the cash bonus pool that is available for any
subsequent Period or Periods.
5.3 A Participant's share of the cash bonus pool shall be
calculated by dividing the amount of the cash bonus pool by the number of
participants in the Plan. The Committee shall have the authority to reduce any
participant's share of the cash bonus pool to the extent it deems appropriate.
In determining the amount to be paid to a participant for any Period, the
Committee will consider a number of performance factors, including, but not
limited to, the Company's net income and cash flow, quality indicators, and
other relative operating and strategic results.
5.4 Shares of the cash bonus pool will be paid in the year
following the completion of the performance period.
Section 6
SPECIAL DISTRIBUTION RULES
6.1 Change of Control. Notwithstanding any other provision of this
Plan, in the event of a Change of Control, as defined below, the following
shall occur:
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(a) The cash bonus pool shall be calculated as if the
end of the Period were the date of the Change of Control;
(b) Each Participant's share of the cash bonus pool
shall be determined subject to Section 5.3; and
(c) Each Participant shall be immediately paid his or
her share of the cash bonus pool that results from the foregoing calculation.
For purposes of the Plan, a "Change of Control" shall mean any of the
following:
(i) Any "person" (as such term is used in Sections 13 (d)
and 14 (d) (2) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") is or becomes a beneficial owner of (or otherwise has the
authority to vote), directly or indirectly, securities representing twenty
percent (20%) or more of the total voting power of all the Company's then
outstanding voting securities, unless through a transaction arranged by, or
consummated with the prior approval of the U S WEST Board of Directors;
(ii) Any period of two (2) consecutive calendar years during
which there shall cease to be a majority of the U S WEST Board of Directors
comprised as follows: individuals who at the beginning of such period
constitute the Board of Directors any new director(s) whose election by the
Board of Directors or nominations for election by the Company's shareholders
was approved by a vote of at least two-thirds (2/3) of the directors then still
in office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved;
(iii) the Company becomes a party to a merger, consolidation
or share exchange in which either (i) the Company will not be the surviving
corporation or (ii) the Company will be the surviving corporation and any
outstanding shares of Common Stock of the Company will be converted into shares
of any other company (other than a reincorporation or the establishment of a
holding company involving no change of ownership of the Company) or other
securities or cash or other property (excluding payments made solely for
fractional shares); or
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(iv) Any other event that a majority of the U S WEST Board
of Directors, in its sole discretion, shall determine constitutes a Change of
Control.
6.2 Special Circumstances. If, prior to a distribution from the
cash bonus pool, a participant (i) is discharged by the Company, (ii) is
demoted, or (iii) becomes associated with, employed by or renders services to,
or owns a material interest in any business that is competitive with the
Company, the Committee shall have the authority to (a) reduce or cancel
payments that would otherwise be paid from the cash bonus pool, (b) permit
continued participation in the Plan or an early distribution therefrom, or (c)
any combination of the foregoing.
Section 7
MISCELLANEOUS PROVISIONS
7.1 Assignment or Transfer. No opportunity shall be assignable or
transferable by a participant.
7.2 Costs and Expenses. The costs and expenses of administering the
Plan shall be borne by the Company and shall not be charged against any
participant.
7.3 Other Incentive Plans. The adoption of the Plan does not preclude
the adoption by appropriate means of any other incentive plan for employees.
7.4 Effect on Employment. Nothing contained in this Plan or any
agreement related hereto or referred to herein shall affect, or be construed as
affecting, the terms of employment of any participant except to the extent
specifically provided herein or therein. Nothing contained in this Plan or any
agreement related hereto or referred to herein shall impose, or be construed as
imposing, any obligation on (i) the Company to continue the employment of any
participant and (ii) any participant to remain in the employ of the Company.
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7.5 Pension Formula. Unless otherwise prohibited by the Committee,
awards under the Plan shall be used to compute a pension amount in the U S WEST
Executive Non-Qualified Pension Plan and will be used to calculate coverage in
the U S WEST Executive Life Insurance Program (if such coverage is elected).
Awards shall not be considered compensation for purposes of the U S WEST
Savings Plan/ESOP.
7.6 Taxation. The Company shall have the right to deduct from any
award to be paid under the Plan any federal, state or local taxes required by
law to be withheld with respect to such payment.
7.7 Amendment of Plan. The U S WEST Board of Directors shall have the
right to suspend or terminate this Plan at any time and may amend or modify the
Plan prior to the beginning of any Period.
Section 8
PLAN ADMINISTRATION
8.1 Committee Authority Delegation. The Committee shall have full
power to administer and interpret the Plan and to establish rules for its
administration. The Committee may designate Company employees to act in its
behalf to engage in daily administration of the Plan. The Committee or its
designee may administer the Plan in all respects including the proration or
adjustment of awards in the case of retirements, terminations, entrance to or
exit from a level of management, changes in base salary, dismissal or death and
other conditions as appropriate.
8.2 Governing Law. The Plan shall be governed by the laws of the
state of Colorado and applicable federal law.
8.3 Committee Reliance. The Committee, in making any determination
under or referred to in the Plan shall be entitled to rely on opinions, reports
or statements of officers or employees of the Company and other entities and of
counsel, public accountants and other professional expert persons.
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Section 9
CLAIMS AND APPEALS
9.1 Committee Procedure. Claims and appeals will be processed in
accordance with the following procedures:
(a) Any claim under the Plan by a participant or anyone
claiming through a participant shall be presented to the Committee.
(b) Any person whose claim under the Plan has been denied
may, within sixty (60) days after receipt of notice of denial, submit to the
Committee a written request for review of the decision denying the claim.
(c) The Committee shall determine conclusively for all
parties all questions arising in the administration of the Plan.
9.2 Arbitration. Any dispute that may arise in connection with this
Plan shall be determined solely by arbitration in Denver, Colorado under the
rules of the American Arbitration Association. Any claim with respect to any
benefit under this Plan must be established by a preponderance of the evidence
submitted to the impartial arbitrator. The arbitrator shall have the authority
to award the prevailing party damages incurred as a result of any breach,
costs, reasonable attorneys' fees incurred in connection with the arbitration,
and direct that the non-prevailing party pay the expenses of arbitration. The
decision of the arbitrator (i) shall be final and binding; (ii) shall be
rendered within ninety (90) days after the impanelment of the arbitrator; and
(iii) shall be kept confidential by the parties to such arbitration. The
arbitration award may be enforced in any court of competent jurisdiction. The
Federal Arbitration Act, 9 U.S.C. Sections 1-15, not state law, shall govern
the arbitrability of all claims.
Section 10
ADOPTION OF THE PLAN
This Plan shall become effective on the date on which it is approved by
shareholders of U S WEST, Inc.