INTERNATIONAL PRESENTED BY QWEST

August 3, 2000

Joe Nacchio

Jack Vickers, Jr.

JACK VICKERS: Thank you Buddy. I'd like to first of all, welcome everyone. And for those of you that haven't been here before, welcome to our first INTERNATIONAL for you and our 15th for a lot of you. We appreciate your support and presence here. And I am pretty excited about this particular year because we have made a big transition, as you know. This is the new kickoff for our new sponsors and so on. I am particularly proud to have Qwest as our leading new presenting sponsor. And Mr. Joe Nacchio here is chairman, as you know, and CEO. And Joe, it's a pleasure to have you with us. Joe has been great in his quick uptake of understanding of this tournament and what goes on, what is behind it; and hopefully, we are guiding him through some woods here and helping him to better understand it. We want him to get all the mileage out of this he possibly can. And we are proud to have him, and we are going to be working very close with him. They are a great organization. Joe is a great guy here, as you will see, and as you will hear. Joe, it's pleasure to have you aboard.

JOE NACCHIO: Thanks, Jack. Thanks very much. We are delighted to be associated with The INTERNATIONAL. This is the first event of this type that we have ever affiliated with. We are a relatively new company, as many of you know. There is a lot of good reasons why we picked The INTERNATIONAL. I am sure some of you will ask me about those in a moment. But this is the first time we will also -- kind of an interesting footnote -- this will be the first time Qwest will be on broadcast television this weekend, as we have sponsorship positioning with the CBS with commercials. So we have never been on national media. It is very much coincident, fortunately, with our recent merger with U.S. West. A lot of things came together. So we are totally delighted. I have enjoyed my day and a half that I have been here already, and I am sure I will enjoy the whole weekend, as we are -- we will be hosting several hundred customers who we are bringing in from around this region and around the country to see this tournament.

JOE NACCHIO: It is interesting we are relatively new, but have grown very quickly. We are already a Fortune 100 company in less then three years of being public. We looked at wanting to get national an international brand presence in a quick way. We looked at the sport of golf; and if you look at how fast the popularity of golf is expanding, both domestically and globally, and you look at the demographics it cut across, it made sense. Our second decision then was, well, if we were going to do golf, who do we do it with? You know The INTERNATIONAL became quite frankly the baseball metaphor "a natural" for the following reasons: If you look at the way they score in this tournament, it rewards risk taking -- kind of entrepreneurialism in golf, which is how we see our heritage. Second thing, it's a tournament that has broad national -- not just national, but international appeal. We have grown fast internationally. The third thing that persuaded us was that we were in Denver. We are headquartered in Denver, and it's a local tournament, so we get both the global-local flavor at the same time. Then finally, I think what cemented it when we started dealing with Jack and his staff in negotiating -- you can always tell the character of somebody when you are negotiating a deal as compared to when you are selling. And we just liked the people. We thought it was good people. We thought they were quality people. We thought they were certainly honest. All the things you want to have a business relationship with. So it kind of came together. Timing couldn't be better, because we are known somewhat around the world. We are going to be known a lot more in these 14 States because of the U.S. West. This gives us national and international exposure; kind of a seminal moment in our young history.

JACK VICKERS: I just heard about it when I walked in here, Gary. Obviously it is a big loss. I know David hurt his back, what, some six or eight weeks ago. He has been nursing it along. I am sorry to hear that he couldn't go any further this morning. So David has been a great supporter of The INTERNATIONAL, and I am sure it's hurting real bad or he wouldn't have dropped out of there. So I feel for him, and I hope he gets well quick.

JOE NACCHIO: More than a little.

JACK VICKERS: (Laughs.) Well, I didn't. I just wanted to try and encourage Joe to come out and play a little golf and get out of that office, get a little fresh air once in a while. He has been working awful hard, I know that. So the first time he came out, he had this raunchy-looking golf bag. I told him: " You can't come out here with a golf bag like that." So we fixed him up with a golf bag and some new clubs and told him that he'd come out here and get as many lessons as he wanted to get. So we are going to make a golfer out of him yet. If he can get out of that office, that is.

JOE NACCHIO: I was told that there were five mechanics to a swing. And when Don Hurter put me on tape, I was 0 for 5. Of course, since my clubs were also the wrong length -- although that didn't make much of a marginal difference. So if you are going to ask me how I did yesterday in the Pro-Am, the only thing I will say: I walked away without any insurance liability. No houses or people are suing me as of this morning. So I thought it was a good day.

JACK VICKERS: As you all know, golf isn't an easy one to take up. And it isn't that Joe just took it up, but almost.

JOE NACCHIO: Almost took it up.

JACK VICKERS: I think he is enthused about it, and I hope that he will continue to work on it.

JOE NACCHIO: Very much so.

JOE NACCHIO: We will be for several years. That is what we have already committed to. I think we will kind of learn with the process, is probably the best way of saying it. I had some knowledge of how tournaments worked from my past career, because AT&T sponsored Pebble Beach, so I had some feel for it. I think it is a great event for a large national business, and we will grow with it. So we participated this year - I guess in some of the tournaments for some of the younger people, and I thought that was a great model that I hope gets expanded across the PGA, I think, to get young people into the game. But, you know, we got into this a little bit late this year. To be fair, we didn't negotiate it until the spring. We were in the middle of the other merger. We didn't focus a lot, so this is a little bit our training wheels in terms of being a sponsor -- taking a lot of coaching from Jack and his staff on how to do things right. We are not too proud to learn.

JACK VICKERS: Well, No. 1, still my position on it, I have had several meetings with them on it, and it is something that is being taken under consideration, and we will be meeting again down the line here. We want to try and get back into the sequence that we had before. And I feel very strongly that having put the first million dollar tournament on out there on the Tour, that we deserve a little more consideration on this and I'm pressing for that. The thing that was more upsetting about it than anything was it was kind of sprung on us without the due process, I think, and consideration, and the result of it is it affected a lot of people, including the players who, as you know, the superstars make their plans well down the line, ahead of time. And so we have been hurt -- some on our field this year, and in terms of some of the players that aren't here, and that is understandable. And as far as I am concerned, it was very predictable. But they didn't think it would be as much of a problem as I did, and I think everybody knows now, particularly you all, you know there are some good players that aren't here. And I think there is good reason for that. I am going to be very persistent in pushing to get this back on track.

JACK VICKERS: No, it is not.

JACK VICKERS: Well, I guess my answer to that, Terry, is I don't deal in ifs and first of all, I think we want to see what we are dealing with, and then we can make necessary adjustments to or at least attempt to see whether it meets our expectations or it doesn't. I think we are just going to have to play that one out and kind of see what can be worked out and negotiated and that is my intent right now and it is being worked on and I don't have a quick answer for it. It is not an easy one to solve.

JACK VICKERS: I don't like that because you like to get in a groove and stay there and everybody knows what to expect and they can put it on their calendar and we liked our grouping from before and you know, when we started out on that grouping, we had some question marks about that at the time. It turned out that it worked very well and I want to get back in that sequence. It is not the change of dates to me as much as it is the sequence, and we would have probably been at a $5 million tournament this year and had we been able to work the things out that we wanted to work out, but they said they are not that easy and it takes time, but we were willing. But we weren't going to do it without knowing where we stood. So we want to continue to build and we don't want to be dragged down. We want this to be the best golf tournament out there. There is no reason why it can't be. We have got all the tools and we have got great sponsorship. Got a great golf course to play on and I think the Tour has got to sit down and sort some things out themselves. I can't speak for the Tour, but they know I am unhappy about this situation and we are going to keep working on it.

JOE NACCHIO: We have got so many signs Downtown Denver I doubt that we need one on the stadium. I am looking hard at how do we expand our presence in sports particularly because we have a large consumer and business franchise in the United States and sports is a major center of attention for them. Again we are going to learn from this tournament with the class of customers we invite and then we do other things around these 14 States as well as around the nation. I suspect our presence will grow as our company grows. The stadium is an interesting one. We have been asked by many cities to do stadiums and I am just not a big fan of naming stadiums personally.

JOE NACCHIO: I don't know. Maybe I am old fashioned. I used to like Candlestick Park when it was Candlestick. I will probably always call it Yankee Stadium even if they sell the name. If you look at Denver in particular, look downtown we have got two signs on our old building and now we got three on our new one. I think there is no one who is going to be at the new stadium and not see our sign anyhow so why pay 50 or 100 million for an extra sign.

JOE NACCHIO: Of course. Yes, it is now the Qwest Foundation. I haven't looked into that yet. Back to this tournament, one of the reasons we like this tournament also was the Boys and Girls club, in terms of where the charity money went to. I think our orientation -- we haven't had a major discussion on this yet with the board, but my orientation would be to put charitable money towards youth and education. We do a lot of other things and some of those are good things. I am not suggesting it wouldn't continue. But that is where my personal orientation is. That is probably what I would try to influence the board to agree with as we get to that topic. But it is still moving along. We haven't made any policy decision.

JOE NACCHIO: Jack and I talked about that. There is a value difference. I am very happy with The INTERNATIONAL, Presented by Qwest. We could go the other way, at some point. But I think Jack's intention is to make this a tournament, a premier tournament, separating it from others. And we like that effect. Again, we have got some experience in branding and there -- this is more of an art than a science and particularly where we are now. Where people didn't -- there is a large part of this country that still calls us"Q" "West". Just getting any national branding presence is the right step at this time, but might we go further, it would probably be something we'd consider.

JACK VICKERS: I have always felt that if you look at the many tournaments that the one that sticks out predominantly is the Masters and that concept, I think, is a little classier concept. I think it gets just as much exposure as the other way. I think Madison Avenue has sold some people that it doesn't, but it has worked there for 40 years I guess, basically with the same two companies and so I think that speaks well for itself. It is the premier tournament I think including all the other majors and all the other tournaments, so I kind of took a chapter out of that book being the new boy on the block and I think it will work well and did work well at the start. And we tried the other and I don't have anything against the other, but I think this is a little classier presentation.

JOE NACCHIO: Well, for those of you who aren't familiar with Qwest, we describe ourselves as a broadband internet communications company. We have got a fiberoptic facility in the US, Canada, Mexico, Europe; putting cables in under the Atlantic, Pacific. We have got 25 million customers. We do everything from local telephone service in these 14 States to web hosting, internet backbone, very high speed transmission at the optical level for large corporations, federal government, all those kind of things. We are kind of what I would argue is the -- if you use the overworked term of old age/new age economy, we are the first of the post-internet communication companies to come of age. And with our acquisition of U.S. West, it is kind of an analogous situation to what I argue what AOL is to Time Warner. We have grown very quick. We have a large operation in Europe - Amsterdam, where it's headquartered; soon to be expanding to Asia. We looked at the global aspect of what we are becoming and we looked at this tournament and its name obviously, but the kind of field it brings and kind of coverage it gets and again it was another natural fit for what we needed to do.

JACK VICKERS: When we built this golf course I had in mind the tournament and I have been asked that question a lot of times and the answer is yes, I was anticipating a tournament, not knowing whether I could get one going or not. But through the help of Jack Nicklaus, we engaged ourselves with Deane Beman, who was the Commissioner at the time, and were able to work it out and Dean did most of the talking at the first meeting, I remember pretty well. And he went on and on and on and we were trying to do something a little different. So we kind of shocked him when we said something about going a different route than the medal play, 72 hole medal play. So we considered Match Play and so on. We probably would have gone Match Play except it is too tough TV-wise and unpredictable. We had to get something that fitted everybody's purpose here. So we came up with this idea of the modified Stableford and tweaked it a little bit to make it more exciting. My brother, Jimmy, was responsible for that, and I think has done a good job. I think created a lot of controversy at first which was perfect. That was just what we were looking for. And it hit all the media and the world and all of a sudden, it went from controversy to the guys thinking, oh, this is kind of fun. It's the only tournament during the course of the year that they get a break. They get to play something a little different. And now it has gotten to be very popular both fan-wise, TV-wise and I am real happy with it because of the interest on behalf of the American public and particularly, TV people and the players. The players at first, you know, were comme si, comme ca (phonetic); then all of a sudden they got with it. They really do have some fun here. In fact, I have offered on numerous occasions to consider a revamp of the format and both the network and the players said: No, no just don't mess with it. It is fun and we like playing it and you are seeing the results, so we have grown and grown with this thing and I think if we had gone the other route of playing a medal play tournament, we would have been 15 years which we have been now, we would still be working our way up the ladder. I think we are well up the ladder now, considered one of the top tournaments and I really feel good about that. I think all the players and everybody concerned does too. So I know it has been -- many of you were here from day one and it was fun to kind of see the transition from the cuts everyday to modifying of that, so on. I think some of the players that didn't like the cuts at first would like to see us now go back to the cuts, but we don't want to stir the waters up. We think we have got a good thing going, we are going to leave it the way it is. I feel very good about the history of our tournament and glad we are where we are and we are fortunate to be where we are. And we hope to continue to build it and make it even better. And we have some good ideas up our sleeves as to how to go about that and we are going to keep pressing.

BUDDY MARTIN: Mr. Nacchio, Mr. Vickers, thank you very much. We appreciate it.