Exhibit 10.3(a)

 

VARIETAL DISTRIBUTION HOLDINGS, LLC

 

2007 SECURITIES PURCHASE PLAN

 

1.             Purpose of Plan.  This 2007 Securities Purchase Plan (the “Plan”)
of Varietal Distribution Holdings, LLC, a Delaware limited liability company
(the “Company”), adopted by the Board of Managers of the Company on June 29,
2007, for employees, managers, consultants and advisers of the Company and its
Subsidiaries, is intended to advance the best interests of the Company and its
Subsidiaries by providing those persons who have a substantial responsibility
for their management and growth with additional incentives by allowing such
persons to acquire an equity interest in the Company and thereby encouraging
them to contribute to the success of the Company and its Subsidiaries and, in
the case of employees, to remain in their employ. The availability and offering
of Common Units and Preferred Units under the Plan also is intended to increase
the Company’s and its Subsidiaries’ ability to attract and retain individuals of
exceptional managerial talent upon whom, in large measure, the sustained
progress, growth, and profitability of the Company and its Subsidiaries depends.
The Plan is intended to be a compensatory benefit plan within the meaning of
Rule 701 of the Securities Act and, unless and until the Common Units and
Preferred Units are publicly traded, the issuance of Common Units and Preferred
Units pursuant to the Plan is intended to qualify for the exemption from
registration under the Securities Act provided by Rule 701; provided that the
foregoing shall not require the Company to rely on Rule 701 for any issuance
pursuant to this Plan to the extent that another exemption from registration
under the Securities Act is available for such issuance.

 

2.             Definitions.  Capitalized terms used but not otherwise defined
herein shall have the meanings set forth below:

 

“Affiliate” of any particular Person means any other Person controlling,
controlled by, or under common control with such particular Person, where
“control” means the possession, directly or indirectly, of the power to direct
the management and policies of a Person whether through the ownership of voting
securities, by contract, or otherwise.

 

“Board” means the Board of Managers of the Company or any successor governing
body thereto.

 

“Common Units” means “Class A Common Units”, as such term is defined in the
Limited Liability Company Agreement.

 

“Committee” means the committee of the Board which may be designated by the
Board to administer the Plan. The Committee shall be composed of two or more
managers as appointed from time to time to serve by the Board.

 

“Limited Liability Company Agreement” means “LLC Agreement” means the Limited
Liability Company Agreement of the Company, dated on or about the date hereof
among the parties from time to time party thereto, as amended from time to time
pursuant to its terms.

 

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“Participants” means present and future employees, managers, consultants or
advisers of the Company or its Subsidiaries, as such persons may be selected in
the sole discretion of the Committee.

 

“Person” means an individual, a partnership, a limited liability company, a
corporation, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization, an investment fund, any other business entity and a
governmental entity or any department, agency or political subdivision thereof.

 

“Preferred Units” means the “Class A Preferred Units”, as such term is defined
in the Limited Liability Company Agreement.

 

“Subsidiary” means, with respect to any Person, any corporation, limited
liability company, partnership, association, or business entity of which (i) if
a corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers, or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof, or (ii) if a limited liability company,
partnership, association, or other business entity (other than a corporation), a
majority of  partnership or other similar ownership interest thereof is at the
time owned or controlled, directly or indirectly, by that Person or one or more
Subsidiaries of that Person or a combination thereof. For purposes hereof, a
Person or Persons shall be deemed to have a majority ownership interest in a
limited liability company, partnership, association, or other business entity
(other than a corporation) if such Person or Persons shall be allocated a
majority of limited liability company, partnership, association, or other
business entity gains or losses or shall be or control any managing director or
general partner of such limited liability company, partnership, association, or
other business entity..

 

“Securityholders Agreement” means the Securityholders Agreement, dated on or
about the date of the adoption of this Plan, among the Company and holders of
the Units signatories thereto, as the same may be amended, supplemented or
otherwise modified from time to time.

 

“Units” has the meaning given to such term in the Limited Liability Company
Agreement.

 

3.             Grant or Sale of Units.  The Committee shall have the power and
authority to grant without consideration or to sell to any Participant any Units
at any time prior to the termination of this Plan in such quantity, at such
price, on such terms and subject to such conditions that are consistent with
this Plan and established by the Committee. Units granted or sold under this
Plan shall be subject to such terms and evidenced by agreements as shall be
determined from time to time by the Committee (each a “Management Unit Purchase
Agreement”). Participants receiving grants or purchasing Units pursuant to this
Plan shall be required, as a condition to such grant or purchase, to become a
party to the Limited Liability Company Agreement, the Securityholders Agreement
and any other agreement or arrangement determined by the Committee.

 

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4.             Administration of the Plan.  The Plan shall be administered by
the Committee; provided that if for any reason the Committee shall not have been
appointed by the Board, all authority and duties of the Committee under the Plan
shall be vested in and exercised by the Board. Subject to the limitations of
this Plan, the Committee shall have the sole and complete authority to: (i)
select Participants, (ii) grant or sell Units to Participants on such terms and
in such amounts as it shall determine, (iii) impose such limitations,
restrictions and conditions upon such Units as it shall deem appropriate, (iv)
interpret this Plan and, as applied to Participants and their permitted
transferees, the LLC Agreement, the Securityholders Agreement and the Management
Unit Purchase Agreement  (collectively with the Plan, the “Equity Agreements”)
and adopt, amend and rescind administrative guidelines and other rules and
regulations relating to the Equity Agreements as applied to Participants and
their permitted transferees, (v) correct any defect or omission or reconcile any
inconsistency in the Equity Agreements as applied to Participants and their
permitted transferees and (vi) make all other determinations and take all other
actions necessary or advisable for the implementation and administration of the
Equity Agreements as applied to Participants and their permitted transferees.
Each action of the Committee or the Board shall be binding on all Participants.

 

5.             Taxes.  The Company shall be entitled, if necessary or desirable,
to withhold (or secure payment from any Participant in lieu of withholding) the
amount of any withholding or other tax due from the Company with respect to any
amount payable and/or Units issuable under this Plan, and the Company may defer
such payment or issuance unless indemnified to its satisfaction.

 

6.             Rights of Participants.  Nothing in this Plan or in any Equity
Agreement shall interfere with or limit in any way the right of the Company or
any Subsidiary to terminate any Participant’s employment at any time (with or
without cause), nor confer upon any Participant any right to continue in the
employ of the Company or any Subsidiaries or Affiliates for any period of time
or to continue his or her present (or any other) rate of compensation. No person
shall have a right to be selected as a Participant or, having been so selected,
to be selected again as a Participant.

 

7.             Certain Adjustments.  The number of Units issued under the Plan
to each Participant shall be proportionately adjusted in the case of a Unit
split, reverse Unit split, Unit dividend, recapitalization, combination,
reclassification or other distribution in respect of the Units without the
receipt of consideration by the Company.

 

8.             Amendment, Suspension, and Termination of Plan.  The Board or the
Committee may suspend or terminate the Plan or any portion thereof at any time
and may amend it from time to time in such respects as the Board or the
Committee may deem advisable; provided that no such amendment shall be made
without the approval of the Board to the extent such approval is required by
law, agreement or the rules of any exchange upon which the Units are listed, and
no such amendment, suspension, or termination shall impair the rights of
Participants under outstanding Management Unit Purchase Agreements without the
consent of the Participants affected thereby, except to the extent provided for
in any such Management Unit Purchase Agreement. The Plan shall terminate on the
tenth anniversary of the date the Plan has been adopted by the Board and no
Units shall be issued hereunder after such date.

 

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9.             Indemnification.  In addition to such other rights of
indemnification as they may have as members of the Board or the Committee, the
members of the Board and the Committee shall be indemnified by the Company
against all costs and expenses reasonably incurred by them in connection with
any action, suit, or proceeding to which they or any of them may be party by
reason of any action taken or failure to act under or in connection with the
Plan or any Units issued hereunder, and against all amounts paid by them in
settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment
in any such action, suit or proceeding; provided that any such Board or
Committee member shall be entitled to the indemnification rights set forth in
this Section 9 only if such Board or Committee member has acted in good faith
and in a manner that such Board or Committee member reasonably believed to be
in, or not opposed to, the best interests of the Company and, with respect to
any criminal action or proceeding, had no reasonable cause to believe that such
conduct was unlawful, and further provided that upon the institution of any such
action, suit, or proceeding a Board or Committee member shall give the Company
written notice thereof and an opportunity, at the Company’s own expense, to
handle and defend the same before such Board or Committee member undertakes to
handle and defend such action, suit or proceeding on his own behalf.

 

10.           Shareholder Approval.  The Plan shall be duly approved by a
majority of the outstanding Class A Common Units of the Company entitled to vote
within 12 months after the Plan has been adopted by the Board.

 

Adopted by the Board of Managers of the Company, on  June 29, 2007.

 

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