Exhibit 10.2

 

Execution Version

 

AMENDMENT NO. 1 TO THE

 

STANDSTILL AGREEMENT

 

This Amendment No. 1 to the Standstill Agreement (this “Amendment”), dated as of
March 15, 2012, is made by and between Level 3 Communications, Inc., a Delaware
corporation (the “Company”), and Southeastern Asset Management, Inc., a
Tennessee corporation (“Southeastern”), and amends the Standstill Agreement,
dated as of May 20, 2011, between the Company and Southeastern (the “Standstill
Agreement”).  Capitalized terms used in this Amendment and not otherwise defined
herein shall have the meanings given them in the Standstill Agreement.

 

RECITALS

 

WHEREAS, Southeastern is the Beneficial Owner of shares of common stock, $0.01
par value per share (“Common Stock”), of the Company and is the investment
adviser to Longleaf Partners Fund (“Longleaf”), a series of Longleaf Partners
Funds Trust, a Massachusetts business trust; and

 

WHEREAS, the Company and Longleaf have entered into an Exchange Agreement, dated
as of March 13, 2012 (the “Exchange Agreement”), pursuant to which the Company
has agreed to acquire, and Longleaf has agreed to deliver to the Company,
$100,062,000 in principal amount of the Company’s 15% Convertible Senior Notes
due 2013 held by Longleaf in exchange for the Company’s issuance to Longleaf of
5,447,129 shares of Common Stock, in each case, subject to the terms and
conditions of such agreement; and

 

WHEREAS, pursuant to the Standstill Agreement, during the Standstill Period,
Southeastern has agreed not to, without the prior written consent of a majority
of the entire Board of Directors, acquire any Common Stock, Voting Securities or
Derivative Securities of the Company, other than in open market transactions
that do not involve the issuance of Common Stock by the Company and unless after
giving effect to such acquisition Southeastern would Beneficially Own less than
46,000,000 shares of Common Stock (as adjusted to take into account the 1-for-15
reverse stock split of the Common Stock);

 

WHEREAS, in connection with the exchange contemplated by the Exchange Agreement,
the Company and Southeastern desire to increase the maximum number of shares of
Common Stock that Southeastern is permitted to Beneficially Own pursuant to the
terms of the Standstill Agreement; and

 

WHEREAS, the Company (by action of a majority of the entire the Board of
Directors of the Company) has determined that an amendment to the Standstill
Agreement as set forth herein is desirable in connection with the foregoing and
has approved this Amendment; and

 

WHEREAS, pursuant to Section 5.10 of the Standstill Agreement, the Company and
Southeastern now desire to duly execute and evidence such amendment in writing.

 

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements set
forth in the Standstill Agreement and herein, the parties hereto agree as
follows:

 

--------------------------------------------------------------------------------

 

1.                                       Amendment and Restatement of
Section 4.1(a)(i)(B).  Section 4.1(a)(i)(B) of the Standstill Agreement is
hereby amended and restated in its entirety to read as follows:

 

“B.                                                    any Common Stock, Voting
Securities or Derivative Securities of the Company (x) other than in open market
transactions that do not involve the issuance of Common Stock by the Company or
pursuant to the Exchange Agreement dated as of March 13, 2012, by and among the
Company, Longleaf Partners Fund and Southeastern (solely with respect to
Sections 3, 5.2 and 5.4 therein), and (y) unless after giving effect to such
acquisition Southeastern would Beneficially Own less than 49,840,000 shares of
Common Stock (subject to appropriate adjustment to take into account any stock
splits, subdivisions, stock dividends, combinations, reclassifications or
similar events occurring after the date hereof); provided that Southeastern
shall in no event make any such acquisition for its own account or on behalf of
any Advisory Client if it or such Advisory Client is on the date of such
purchase or would become, as a result of such purchase, a “5-percent
shareholder” of the Company within the meaning of Section 382 of the Internal
Revenue Code of 1986, as amended, and the regulations promulgated thereunder
(including all applicable attribution rules) (the “Code”);”

 

2.                                       Miscellaneous.

 

(a)                                  This Amendment may be executed in one or
more counterparts, each of which shall be deemed to be an original, and all such
counterparts shall together constitute one instrument.

 

(b)                                 Except as specifically modified herein, the
Standstill Agreement shall not otherwise be supplemented or amended by virtue of
this Amendment, but shall remain in full force and effect.  The execution,
delivery and effectiveness of this Amendment shall not, except as expressly
provided herein, constitute a waiver or amendment of any provision of the
Standstill Agreement.  Upon and after the effectiveness of this Amendment, each
reference in the Standstill Agreement to “this Agreement”, “hereunder”, “hereof”
or words of like import referring to the Standstill Agreement, and each
reference in any other document to “the Standstill Agreement”, “thereunder”,
“thereof” or words of like import referring to the Standstill Agreement, shall
mean and be a reference to the Standstill Agreement as modified hereby.

 

(c)                                  This Amendment shall be deemed effective as
of the date first written above, as if executed on such date.

 

(d)                                 This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York, without giving
effect to conflict of law principles thereof.

 

[Remainder of this page intentionally left blank.]

 

2

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties have caused this Amendment to the Standstill
Agreement to be duly executed as of the day and year first written above.

 

 

LEVEL 3 COMMUNICATIONS, INC.

 

 

 

 

 

 

 

By

/s/ John M. Ryan

 

 

Name: John M. Ryan

 

 

Title: Executive Vice President

 

 

 

 

SOUTHEASTERN ASSET MANAGEMENT, INC., on behalf of certain institutional clients

 

 

 

 

 

 

 

By

/s/ Andrew R. McCarroll

 

 

Name: Andrew R. McCarroll

 

 

Title: General Counsel

 

[Signature Page to Amendment No. 1 to Standstill Agreement]

 

--------------------------------------------------------------------------------