Exhibit 10.4


 


MASTER
DEFERRED ISSUANCE STOCK AGREEMENT


FOR
NON-EMPLOYEE DIRECTORS


 


This Master Deferred Issuance Stock Agreement
for Non-Employee Directors (along with the Exhibit hereto, this “Agreement”)
is entered into as of                                           ,
by and between Level 3 Communications, Inc., a Delaware corporation
(the “Company”), and the individual whose name appears on the signature page to
this Agreement (the “Director”), an “Employee” as defined in the Company’s Level
3 Communications, Inc. Stock Plan (as amended from time to time, the “Plan”).


 


The
Company, pursuant to a grant of authority from the Compensation Committee of
the Company’s Board of Directors (the “Committee”), may, from time to time,
grant to the Director the opportunity to acquire a certain number of shares of
its common stock, par value $.01 per share (the “Stock”), in consideration of
the Director’s service as a member of the Company’s Board of Directors,
pursuant to the Plan (an “Award”).


 


The
parties agree as follows:


 


1.                                       Obligation to
Issue Deferred Shares. 
Subject to the terms and conditions of this Agreement,  the Company, from time to
time in its sole discretion, may grant Awards to the Director relating to a
specified number of shares of Stock that, under certain circumstances and in
accordance with the terms hereof, may result in the Director having the right
to receive shares of Stock (the “Deferred Shares”).  Each Award will be evidenced by a Deferred
Issuance Stock Award Letter (an “Award Letter”) in the form attached as Exhibit A
hereto (or such other form, including electronic form, as approved by the
Company), which sets forth the date of the Award (the “Award Date”), the number
of Deferred Shares that are the subject of the Award, and the dates on which
the Company will issue the Deferred Shares to the Director subject to the terms
of this Agreement and any further terms that may be set forth in the applicable
Award Letter (each such date, an “Issuance Date”).


 


2.                                       Acceleration of Issuance of
Deferred Shares. 
Notwithstanding Section 1, the Company will issue all unissued
Deferred Shares to the Director (i) promptly after the death of the Director,
or the Permanent Total Disability of the Director, or (ii) upon or
following a Change in Control, as provided in Section 8.  In addition, the Company will issue all
unissued Deferred Shares to the Director promptly after the date of the
Employee’s Separation from Service (as defined below) on account of retirement
in accordance with the Company’s retirement plan then in effect.  For purposes of this Agreement, “Permanent
Total Disability” means that:  (i) the
Director is unable to engage in any substantial gainful activity by reason of
any medically determinable physical or mental impairment that can be expected
to result in death or can be expected to last for a continuous period of less
than 12 months.  For purposes of this
Agreement, “Separation from Service” shall mean a separation from service as
defined in Treasury Regulation 1.409A-1(h)(1).


 


3.                                       Forfeiture of
Right to Acquire Deferred Shares.  If the Director ceases to be a member of the
Company’s Board of Directors (other than as a result of death, Permanent Total Disability
or Separation from Service on account of retirement, in accordance with the 


 

















 


Company’s
retirement plan then in effect), the Company no longer will be obligated to
issue any unissued Deferred Shares to the Director, and the Director will
forfeit any right to acquire any unissued Deferred Shares from the Company.


 


4.                                       Taxes;
Withholding.  (a) As
of the date of this Agreement, the Director is not subject to Withholding Taxes
(as defined below).  Notwithstanding
anything contained herein to the contrary, other than Section 8 and Section 9,
the Company will not be obligated to issue the Deferred Shares unless the Director
has paid (in cash or by certified or cashier’s check) to the Company all
withholding taxes required as of date after the date of this Agreement to be
collected by the Company under Federal, State, local or foreign law as a result
of the issuance of the Deferred Shares (“Withholding Taxes”); provided, however, that
if the Withholding Taxes are not paid within thirty (30) days following the
date on which the Director is entitled to receive the Deferred Shares, the Director
shall forfeit such Deferred Shares.


 


5.                                       Share
Certificates.  Share certificates
for Deferred Shares will not be issued. 
Upon issuance, Deferred Shares will be deposited into an account for the
Director that is established by the Company.


 


6.                                       Non-Transferability
of Right to Receive Deferred Shares.  Unless specifically permitted by the
Committee, the Director may not transfer, assign, pledge or hypothecate the
right to receive the Deferred Shares, and the right to receive the Deferred
Shares may not be transferred or assigned by operation of law, or be subject to
execution, attachment or similar process other than by will or the laws of
descent and distribution.


 


7.                                       Changes in
Capital Structure.  The number
of Deferred Shares subject to this Agreement is subject to adjustment pursuant
to Section 10.1 of the Plan upon the occurrence of the events described in
that Section.


 


8.                                       Change in
Control.  Notwithstanding Section 1,
upon a Change in Control of the Company that also qualifies as a “change in
control event” as defined in Treasury Regulation 1.409A-3(i)(5)(i) (a “409A
Change in Control”), the Company will, in its sole discretion, either (a) issue
all unissued Deferred Shares to the Director in accordance with Section 10.2
of the Plan or (b) pay the Director in a combination of cash and stock the
value of the Deferred Shares in accordance with Section 10.2 of the Plan.


 


9.                                       Costs.  The Company will pay all original issue and
transfer taxes with respect to, and all other costs, fees and expenses incurred
by the Company in connection with, the issuance of Deferred Shares.  Upon issuance, the Director shall be
responsible for all brokerage expenses associated with the permitted sale of
any Deferred Shares.


 


10.                                 Applicable Law.  No Deferred Shares will be issued and delivered
unless and until, in the opinion of legal counsel for the Company, such
securities may be issued and delivered without causing the Company to be in
violation of or incur any liability under any federal, state or other legal
requirement, including applicable securities laws.


 

















 


11.                                 The Plan.  This Agreement is subject to, and the Director
agrees to be bound by, all of the terms and conditions of the Plan.  The Director acknowledges that the Plan may
be amended from time to time, and that under the Plan, the Committee has
conclusive authority to interpret and construe the Plan and this Agreement and
is authorized to adopt rules for carrying out the Plan.  In the event of any inconsistency or
discrepancy between the provisions of this Agreement and the terms and
conditions of the Plan, the provisions of the Plan will govern and
prevail.  No amendment to or
interpretation of the Plan, however, may deprive the Director of any of his or
her rights under this Agreement.


 


12.                                 Miscellaneous.  (a) The Director will not have any
interest in, or any dividend, voting or other rights of a stockholder with
respect to, the Deferred Shares until the Deferred Shares are issued in
accordance with this Agreement.


 


(b)                                 Any notice to
be given to the Company must be in writing addressed to the Company in care of
the Administrator, at its principal office, and any notice to be given to the Director
must be in writing addressed to the Director at the address for the Director in
the records of the Company or by email or other electronic means using a system
maintained by the Company.  Any such
notice will be deemed duly given when delivered by hand, deposited in the
United States mail, registered or certified mail or transmitted electronically
without a notice of failed delivery.


 


(c)                                  This Agreement
must be construed in accordance with the laws of the State of Colorado, other
than choice of law rules thereof calling for the application of laws of
another jurisdiction.


 


(d)                                 Terms used but
not defined in this Agreement have the meanings ascribed to them under the
Plan.


 


(e)                                  Although any
information sent to or made available to the Director concerning the Plan and
this Award is intended to be an accurate summary of the terms and conditions of
the Award, this Agreement and the Plan are the authoritative documents
governing the Award and any inconsistency between the Agreement and the Plan,
on one hand, and any other summary information, on the other hand, shall be
resolved in favor of the Agreement and the Plan.


 


(g)                                 Notwithstanding
anything herein to the contrary, this Agreement may be amended by the Committee
from time to time without the consent of the Director to the extent the
Committee deems it appropriate to cause this Agreement and/or each Award
hereunder to comply with Section 409A of the Internal Revenue Code of
1986, as amended (“Section 409A”) (including the distribution requirements
thereunder) or be exempt from Section 409A and/or the tax penalty under Section 409A(a)(1)(B).  The Company will provide to the Director a
notice of any amendments made to this Agreement pursuant to this subsection.


 


[Signature page follows]


 

















 


IN
WITNESS WHEREOF,  this Agreement is
entered into by the Director and by the Company as of the date first above
written.


 


 


	
   

  	
  LEVEL
  3 COMMUNICATIONS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DIRECTOR

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  



 

















 


EXHIBIT A


 


LEVEL 3 COMMUNICATIONS, INC.


DEFERRED ISSUANCE STOCK AWARD LETTER


 


This
Deferred Issuance Stock Award Letter (the “Award”) when taken together with the
Master Deferred Issuance Stock Agreement for Non-Employee Directors (“Master
Agreement”) constitutes an award to the individual whose name appears on the
signature line below (“Director”) of Deferred Shares with respect to the shares
of common stock of Level 3 Communications, Inc. (the “Common Stock”) under
the Level 3 Communications, Inc. Stock Plan (as amended from time to time).


 


The
terms and conditions of this Award are set forth below and in the Master
Agreement, the provisions of which are incorporated herein by reference.


 


A.                                   The date of
this Award is                     
(the “Award Date”).


 


B.                                     The number of Deferred
Shares with respect to which this Deferred Issuance Award Letter relates
is                     .


 


C.                                     The Issuance
Date(s) for the Deferred Shares are as follows:


 


D.                                    The following
are conditions to the occurrence of the Issuance Date(s):


 


 


	
   

  	
  LEVEL
  3 COMMUNICATIONS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BY:

  	
   

  
	
   

  	
  ITS:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE: