Exhibit 10.4


 


	
  Employee Name:

  	
   

  
	
   

  	
  (Please
  Print)

  



 


AMENDED
MASTER DEFERRED ISSUANCE STOCK AGREEMENT


 


                This
Amended Master Deferred Issuance Stock Agreement (along with the Exhibits
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 “Employee”), an “Employee” as defined in the Company’s 1995
Stock Plan (Amended and Restated as of April 1, 1998, and as further
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 Employee the
opportunity to acquire a certain number of shares of its common stock, par
value $.01 per share (the “Stock”), in order to retain the Employee as an
employee of the Company or a Subsidiary, 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 Employee relating to a specified number of
shares of Stock that, under certain circumstances and in accordance with the
terms hereof, may result in the Employee 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 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 Employee
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 Employee (i) promptly
after the death of the Employee, or the Permanent Total Disability of the
Employee, 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 Employee 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; provided, however, that
if the Employee is a “specified employee” as defined in Treasury Regulation
1.409A-1(i)(1), the issuance of the Deferred Shares shall be delayed until the
date that is six months and one day following the date of the Employee’s
Separation from Service as a result of retirement.  For purposes of this Agreement, “Permanent
Total Disability” means that:  (i) the
Employee 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, or (ii) the Employee is, 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 not less than 12
months, receiving income replacement benefits for a period of not less than
three months under an accident or health plan covering employees of the
Company.  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 Employee ceases to be an employee of the Company or of a Subsidiary (other
than as a result of death, Permanent Total Disability, Separation from Service
on account of retirement, in accordance with the Company’s retirement plan then
in effect or Separation from Service on account of a termination of the
Employee’s employment by the Company without Cause following a Change in
Control), the Company no longer will be obligated to issue any unissued
Deferred Shares to the Employee, and the Employee will forfeit any right to
acquire any unissued Deferred Shares from the Company.


 


4.             Taxes;
Withholding.  (a) 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
Employee has paid (in cash or by certified or cashier’s check) to the Company
all withholding taxes required 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 Employee is entitled to
receive the Deferred Shares, the Employee shall forfeit such Deferred
Shares.  The Company shall be responsible
for the determination of the amount of any Withholding Taxes based on the last
sale price for the Stock on the Stock’s principal trading market on the
Issuance Date or the last trading date if the Issuance Date is not a day upon
which the Stock has traded.  To the
extent that the Employee desires to pay the Withholding Taxes in cash or by
certified or cashier’s check, with respect to a specific Issuance Date, the
Employee must deliver a separate Withholding Taxes Cash Payment Notification to
the Company’s stock plan administrator substantially in the form of Exhibit B
no later than 45 days prior to that specific Issuance Date.  To the extent that the Employee elects to pay
the Withholding Taxes in cash or by certified or cashier’s check, such payment
must be received by the Company’s stock plan administrator no later than one (1) Business
Day after the Issuance Date of any Deferred Shares that is the subject of the
Withholding Taxes Cash Payment Notification.


 


                (b)  The
Company, in its sole discretion, may permit the Employee to pay any or all
Withholding Taxes through delivery of outstanding Stock or by the Company
withholding a portion of the Deferred Shares issuable pursuant to this
Agreement.  The Employee, however, will
have no absolute right to pay the Withholding Taxes with Stock, and, if such
payment is permitted by the Company, such payment must be made in strict
compliance with rules for such payments established by the Company.  As of the date of this Agreement, unless the
Company has received a properly executed and delivered Withholding Taxes Cash
Payment Notification from the Employee, the Company currently intends to have
the Withholding Taxes paid through the withholding of Stock issuable upon
satisfaction of the terms and conditions set forth in this Agreement (a “net
issuance”).  The Stock that is withheld
by the Company as part of the net issuance (the “Withheld Shares”) will be sold
on behalf of the Employee as contemplated by 


 


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subsection
(c) of this Section 4; provided,
however, that at the sole discretion of the Company, the Withheld Shares may be
retained by the Company and the Company will satisfy the Withholding Taxes from
the Company’s available cash. The Company reserves the right to change its
method with respect to the Employee for the collection of Withholding Taxes
that may be owed by the Employee at any time in its sole discretion, upon
notice to the Employee, which notice may be written or electronic notice.


 


                (c)  By the
execution of this Agreement, to the extent that the Company elects to issue the
Deferred Shares as a net issuance, and, the Employee has not properly executed
and delivered to the Company’s stock plan administrator a Withholding Taxes
Cash Payment Notification, the Employee hereby irrevocably instructs the Company
and a broker of the Company’s choosing, to sell on behalf of the Employee at
the “market price,” that number of shares of Stock required to generate
sufficient funds to equal the Withholding Taxes required to be paid by the
Employee pursuant to this Section 4. 
The Employee represents to the Company and the broker that the Employee
is entering into this Agreement in good faith. 
The Employee shall have no ability to modify these instructions other
than by the proper execution and delivery to the Company’s stock plan
administrator of a Withholding Taxes Cash Payment Notification.  It is the Employee’s intention that this
provision comply with the requirements of Rule 10b5-1 promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934.


 


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


 


6.             Non-Transferability
of Right to Receive Deferred Shares. 
Unless specifically permitted by the Committee, the Employee 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 9.1
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 Employee in accordance with Section 9.2(a) of
the Plan or (b) pay the Employee in a combination of cash and stock the
value of the Deferred Shares in accordance with Section 9.2(b) of the
Plan.  In the event that there is a
Change in Control that does not qualify as a 409A Change in Control, if the
Employee undergoes a Separation from Service on account of his termination of
employment by the Company without Cause following such Change in Control, the
Company will, in its sole discretion, either (a) issue all unissued
Deferred Shares to the Employee in accordance with Section 9.2(a) of
the Plan or (b) pay the Employee in a combination of cash and stock the
value of the Deferred Shares in 


 


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accordance
with Section 9.2(b) of the Plan; provided, however, that if the Employee is a “specified employee” as
defined in Treasury Regulation 1.409A-1(i)(1), the issuance of the Deferred
Shares or cash shall be delayed until the date that is six months and one day
following the date of such Separation from Service.  For purposes of this Agreement, “Cause”
means:  (i) the Employee’s
conviction of or pleading guilty or no contest to a felony, (ii) the
Employee’s habitual use of drugs (including alcohol) which adversely affects
the Employee’s job performance, or (iii) the Employee’s engaging in
willful misconduct or willful neglect which is injurious to the Company.


 


9.             Gross-Up.  If the issuance of Deferred Shares would
result in “excess parachute payments” to the Employee pursuant to Section 280G
of the Internal Revenue Code of 1986, as amended (the “Code”), the Company will
pay the Employee an amount sufficient to put the Employee in the same position
as the Employee would have been if the taxes imposed on the Employee pursuant
to Section 4999 of the Code had not been imposed.  Any such payment will include payment of an
amount equal to any income taxes assessed on the Employee with respect to
payments pursuant to this Section.  The
Company will make any such payment no later than the end of the Employee’s
taxable year following the Employee’s taxable year in which such tax owed by
such Employee that is subject to the tax gross-up payment is remitted to the
applicable taxing authority.  Any such
payment will in all other respects be made in accordance with the rules,
regulations and procedures adopted by the Company from time to time with
respect to such payments under the Plan.


 


10.           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 Employee shall be
responsible for all brokerage expenses associated with the permitted sale of
any Deferred Shares.


 


11.           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.


 


12.           The Plan.  This Agreement is subject to, and the
Employee agrees to be bound by, all of the terms and conditions of the
Plan.  The Employee 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 Employee of any of his or
her rights under this Agreement.


 


13.           Miscellaneous.  (a) The Employee 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.


 


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                (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 Employee must be in
writing addressed to the Employee at the address for the Employee in the
records of the Company or by email or other electronic means using a system
maintained by the Company or its Subsidiary. 
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)           The Employee is an employee at will, and nothing in this
Agreement confers upon the Employee any right to continued employment with the
Company or limits in any way the right of the Company to terminate the
employment of the Employee at any time.


 


                (d)           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.


 


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


 


                (f)            Although any information sent to or made available to the
Employee 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 Employee 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 Employee a
notice of any amendments made to this Agreement pursuant to this subsection.


 


                (h)           To the extent that the Company has issued a Deferred
Issuance Stock Award Letter to the Employee on a date prior to the date of this
Agreement, the terms of this Agreement shall supersede, amend and restate the
terms of any such previously executed agreement governing such Deferred
Issuance Stock Award Letter between the Company and the Employee with respect
to the issuance of Deferred Shares; provided,
however, that the terms of any outstanding Deferred Issuance Stock Award Letter
as to the number of Deferred Shares that is the subject of the Deferred
Issuance Stock Award Letter and the applicable Issuance Date(s) set forth
in the Deferred Issuance Stock Award Letter shall remain in full force and
effect.


 


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


 


	
  LEVEL
  3 COMMUNICATIONS, INC.

  
	
   

  	
   

  
	
  By:

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
  EMPLOYEE

  
	
   

  	
   

  
	
   

  
	
  Name:

  	
   

  
	
   

  	
   

  
	
  Date
  of Hire:

  	
   

  
				



 


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EXHIBIT A


 


LEVEL 3 COMMUNICATIONS, INC.


DEFERRED ISSUANCE STOCK AWARD
LETTER


 


                This Deferred Issuance Stock
Award Letter (the “Award”) when taken together with the Amended Master Deferred
Issuance Stock Agreement (“Master Agreement”) constitutes an award to the
individual whose name appears on the signature line below (“Employee”) 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.
1995 Stock Plan (Amended and Restated as of April 1, 1998, and as further
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:

  	
   

  
			






 


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EXHIBIT B


LEVEL 3 COMMUNICATIONS, INC.


WITHHOLDING TAXES CASH PAYMENT NOTIFICATION


 


                This Withholding Taxes Cash
Payment Notification is being delivered by the individual whose name appears on
the signature line below (the “Employee”) in reference to an Award of
Deferred Shares made to the Employee by Level 3 Communications, Inc. (the “Company”)
pursuant to that certain Amended Master Deferred Issuance Agreement dated as of
                                
between the Company and the Employee (the “Master Agreement”).  Capitalized terms used in this Withholding
Taxes Cash Payment Notification without definition have the meaning given to
those terms in the Master Agreement.


 


                This Withholding Taxes Cash
Payment Notification relates to the Award of Deferred Shares granted to the
Employee pursuant to the Award Letter issued to the Employee dated
                                          ,
the restrictions on which will lapse as to
                          
Deferred Shares on 
                                        
(the “Referenced Award”).


 


                The Employee hereby irrevocable
elects to pay any Withholding Taxes that are owed by the Employee upon the
Issuance Date in cash or by certified or cashier’s check made payable to Level
3 Communications, Inc. within one (1) Business Day of the Issuance
Date.  All payments of Withholding Taxes
are to be made to the Company’s stock award administrator.*


 


                The Employee hereby represents
and warrants to the Company that on the date hereof, the Employee is not in
possession of material non-public information regarding the business or
financial condition of the Company and its subsidiaries.


 


                To the extent that the Employee
is subject to the Company’s Insider Trading Policy’s restrictions on the
ability to trade the Company’s securities other than during an open trading
window, the Employee expressly acknowledges that:  (a) the Employee has executed this
Withholding Taxes Cash Payment Notification during an open trading window
pursuant to the Company’s Insider Trading Policy; and (b) the Employee may
not sell any shares of Stock that are distributed to the Employee on the
Issuance so long as the trading window is closed.


 


	
  Employee:

  	
   

  
	
   

  	
  (Please sign)

  
	
   

  	
   

  
	
  Name:

  	
   

  
	
   

  	
  (Please print)

  
	
   

  	
   

  
	
  Date of Hire:

  	
   

  
				



 


	
  Date:

  	
   

  



 






* Delivery
information with respect to the payment of Withholding Taxes must be obtained
from the Company’s stock plan administrator.


 


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