Exhibit 10.1
FORM OF DEFERRED ISSUANCE STOCK AGREEMENT
This Deferred Issuance Stock Agreement (this "Agreement") is entered into
as of [dated], by and between Level 3 Communications, Inc., a Delaware
corporation (the "Company"), and [name of employee] (the "Employee").
Employee is an employee of the Company or a subsidiary of the Company. The
Company wants to provide the Employee an opportunity to acquire shares of its
common stock, par value $.01 per share ("Stock"), in order to retain the
Employee as an employee of the Company, pursuant to the Level 3 Communications,
Inc. 1995 Stock Plan (as amended from time to time, the "Plan").
The parties agree as follows:
1. Obligation to Issue Deferred Shares. Subject to the terms and conditions
of this Agreement, the Company hereby agrees to issue to the Employee a total of
[number] shares of Stock (together, the "Deferred Shares") in [number of
installments] installments as follows: [vesting schedule] (each such date, an
"Issuance Date"). To the extent that (i) the Employee is subject to the
provisions of the Company's Insider Trading Policy that restrict an employee's
ability to sell shares of Stock to open "trading windows" and (ii) the Issuance
Date would be a day that the Employee is otherwise precluded from selling shares
of Stock by the Company's Insider Trading Policy, the Issuance Date shall be
delayed until the first business day of the next open trading window (a "Delayed
Issuance").
2. Acceleration of Issuance of Deferred Shares. Notwithstanding Section 1,
the Company will issue all unissued Deferred Shares to the Employee, including
any Delayed Issuance Shares (as defined below) (i) promptly after the death of
the Employee or the Disability of the Employee, or (ii) immediately before a
Change in Control. "Disability" means that the Administrator has determined that
the Employee has become permanently disabled under standards adopted from time
to time by the Committee.
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 or Disability), 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; provided,
however, that to the extent that any unissued Deferred Shares are unissued as a
result of a Delayed Issuance ("Delayed Issuance Shares"), the Company shall
issue the Delayed Issuance Shares to the Employee, but shall have no obligation
to issue any other unissued Deferred Shares.
4. Taxes; Withholding. 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"). The Company, in its sole
discretion, may permit the Employee to pay any or all Withholding Taxes
through delivery of outstanding Stock or withholding of Stock 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.
5. Share Certificates. Unless otherwise requested by the Employee,
certificates for Deferred Shares will be registered in the name of the Employee
and will be delivered to the Employee at the Employee's address then listed in
the employment records of 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, the Company will 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.
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 not
later than the date upon which such excise tax payment is due from the Employee
pursuant to Section 4999 of the Code. 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.
11. Applicable Law. No certificate or certificates for 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 rights under this Agreement.
13. Issuance of Shares. Any Deferred Shares issuable upon satisfaction of
the terms and conditions of this Agreement will be issued by the Company to the
Employee prior to the date that is 2 1/2 months after the end of the calendar
year in which the Deferred Shares shall have vested pursuant to the terms of
this Agreement, provided, that if the Employee has not complied by such date
with the provisions of Section 4 of this Agreement relating to payment of all
required Withholding Taxes with respect to such Deferred Shares, the Employee's
right to receive such Deferred Shares shall be forfeited.
14. Miscellaneous. (a) The Employee will not have any interest in, or any
dividend, voting or other rights of a shareholder 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 Employee must be in writing addressed to the
Employee at the address for the Employee in the records of the Company. Any
such notice will be deemed duly given when delivered by hand or deposited
in the United States mail, registered or certified mail.
(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.
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]