EXHIBIT 10.7
SUPERVALU INC.
LONG-TERM INCENTIVE PROGRAM
FOR THE [_____] PERFORMANCE CYCLE
UNDER THE 2007 STOCK PLAN
PERFORMANCE STOCK UNIT AWARD
AGREEMENT (CASH SETTLED)
     This agreement is made and entered into as of the grant date indicated
below (the “Grant Date”), by and between SUPERVALU INC. (the “Company”), and the
individual whose name appears below (“Recipient”).
     The Company has established the Long-Term Incentive Program for the [___]
Performance Cycle under the 2007 Stock Plan (the “Plan”), under which key
employees of the Company may be granted Awards of Performance Stock Units of the
Company. Recipient has been selected by the Company to receive an Award of
Performance Stock Units subject to the provisions of this agreement. Capitalized
terms that are used in this agreement, that are not defined, shall have the
meanings ascribed to them in the Plan.
     In consideration of the foregoing, the Company and Recipient hereby agree
as follows:
     1. Grant. The Company hereby grants to Recipient, subject to Recipient’s
acceptance hereof, an Award of Performance Stock Units for the number of
Performance Stock Units indicated below, effective as of the Grant Date.
     2. Acceptance of Award of Performance Stock Units and Performance Stock
Unit Award Terms and Conditions. The Award of Performance Stock Units is subject
to and governed by the Performance Stock Unit Award Terms and Conditions (“Terms
and Conditions”) attached hereto, which are incorporated herein and made a part
hereof, and the terms and provisions of the Plan. To accept the Award of
Performance Stock Units, this agreement must be delivered and accepted through
an electronic medium in accordance with procedures established by the Company or
Recipient must sign and return a copy of this agreement to the Company. By so
doing, Recipient acknowledges receipt of the accompanying Terms and Conditions
and the Plan, and represents that Recipient has read and understands the same
and agrees to be bound by the accompanying Terms and Conditions and the terms
and provisions of the Plan. In the event that any provision of this agreement or
the accompanying Terms and Conditions is inconsistent with the terms and
provisions of the Plan, the terms and provisions of the Plan shall govern. Any
question of administration or interpretation arising under this agreement or the
accompanying Terms and Conditions shall be determined by the Committee
administering the Plan, and such determination shall be final, conclusive and
binding upon all parties in interest.
     3. Earning and Vesting of Performance Stock Units. Subject to the
accompanying Terms and Conditions, the number of Performance Stock Units that
shall be earned by Recipient under the Award of Performance Stock Units shall be
determined in [Month/Year], in accordance with Exhibit A attached hereto, which
is incorporated herein and made a part hereof. All such Performance Stock Units
shall vest upon earning. Upon the earning and vesting of the Performance Stock
Units, Recipient shall receive a cash payment, as more particularly described in
the accompanying Terms and Conditions.
     Grant Date:
     Number of Performance Stock Units Awarded:

                      SUPERVALU INC.       RECIPIENT:      
By:
                                     
 
  David E. Pylipow                
 
  Executive Vice President, Human Resources And Communications      
SS #  
 
   

 

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SUPERVALU INC.
LONG-TERM INCENTIVE PROGRAM
FOR THE [_____] PERFORMANCE CYCLE
UNDER THE 2007 STOCK PLAN
PERFORMANCE STOCK UNIT AWARD
TERMS AND CONDITIONS (CASH SETTLED)
These Performance Stock Unit Award Terms and Conditions (“Terms and Conditions”)
apply to the Award of Performance Stock Units granted pursuant to the Long-Term
Incentive Program for the [___] Performance Cycle under the 2007 Stock Plan (the
“Plan”), pursuant to the Performance Stock Unit Award Agreement (the
“Agreement”) to which this document is attached. Capitalized terms that are used
in this document, but are not defined, shall have the meanings ascribed to them
in the Plan or the attached Agreement. See Section 19 for a list of defined
terms.
1. Award of Performance Stock Units. SUPERVALU INC. (the “Company”) hereby
grants to you an Award of Performance Stock Units for the number of Performance
Stock Units set forth in the attached Agreement. The Award is effective as of
the Grant Date. Each Performance Stock Unit represents the right to receive cash
in the amount equal to the Fair Market Value of one share of the Company’s
common stock, $1.00 par value (the “Common Stock”), subject to these Terms and
Conditions.
2. Rights with Respect to the Performance Stock Units. The Performance Stock
Units granted pursuant to the attached Agreement do not and shall not give you
any of the rights and privileges of a holder of Common Stock. Your rights with
respect to the Performance Stock Units shall remain forfeitable at all times
prior to the date on which such rights become earned and vested and the
restrictions with respect thereto lapse in accordance with Section 3 or
Section 4 hereof.
3. Earning and Vesting of Performance Stock Units. The number of the Performance
Stock Units that you earn shall be determined in April [___] by the Committee
administering the Plan as more particularly described in Exhibit A to the
attached Agreement or as otherwise expressly provided in these Terms and
Conditions. All such Performance Stock Units shall vest upon earning.
4. Change in Control.

  a)   If, within two (2) years after a Change in Control you experience an
involuntary termination of employment initiated by the Company for reasons other
than Cause, or a termination of employment for Good Reason, then you shall
become immediately and unconditionally vested in all the Performance Stock Units
and the restrictions with respect to all the Performance Stock Units shall lapse
and the Performance Stock Units shall be settled and paid to you as soon as
administratively feasible following your termination of employment but in no
event later than March 15 of the year following the year of your termination of
employment. If the Award of Performance Stock Units is replaced pursuant to
subsection (c) below, the protections and rights granted under this subsection
(a) shall transfer and apply to such replacement grant.     b)   If, in the
event of a Change in Control, and to the extent the Award of Performance Stock
Units is not assumed by a successor corporation (or affiliate thereto) or other
successor entity or person, or replaced with an award or grant that, solely in
the discretionary judgment of the Committee preserves the existing value of the
Award of Performance Stock Units at the time of the Change in Control, then you
shall become immediately and unconditionally vested in all the Performance Stock
Units and the restrictions with respect to all the Performance Stock Units shall
lapse and the Performance Stock Units shall be settled and paid to you as soon
as administratively feasible after the Change in Control but in no event later
than March 15 of the year following the year of the Change in Control.     c)  
If in the event of a Change in Control and to the extent that this Award of
Performance Stock Units is assumed by any successor corporation, affiliate
thereof, person or other entity, or are replaced with awards that, solely in the
discretionary judgment of the Committee preserve the existing value of this
Award of Performance Stock Units at the time of the Change in Control and
provide for vesting, settlement terms and performance goals that are at least as
favorable to you as the vesting and payout terms applicable to this Award of
Performance Stock Units, then the

 

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      assumed Award of Performance Stock Units or such substitute therefor shall
remain outstanding and be governed by its respective terms.

5. Forfeiture. If you cease to be an employee of the Company or any of its
Affiliates prior to the earning and vesting of the Performance Stock Units
pursuant to Section 3 or Section 4 hereof for any reason, then your rights to
all of the Performance Stock Units shall be immediately and irrevocably
forfeited. However, the Committee administering the Plan may determine to
accelerate the earning and vesting of the Performance Stock Units if you cease
to be an employee of the Company or any of its Affiliates prior to the earning
and vesting of the Performance Stock Units pursuant to Section 3 or Section 4
hereof for any reason.
6. Restrictions on Transfer. Except as may otherwise be determined by the
Committee administering the Plan, none of the Performance Stock Units may be
sold, assigned, transferred, pledged, hypothecated or otherwise disposed of or
encumbered by you, and no attempt to transfer the Performance Stock Units,
whether voluntary or involuntary, by operation of law or otherwise, shall vest
the transferee with any interest or right in or with respect to the Performance
Stock Units.
7. Payment. After the Performance Stock Units are earned and vest pursuant to
Section 3 or Section 4 hereof, and following payment of the applicable
withholding taxes pursuant to Section 8 hereof, the Company shall promptly cause
a cash payment in the amount equal to (i) the Fair Market Value as of the
vesting date of one share of Common Stock for each such earned and vested
Performance Stock Unit, multiplied by the number of such earned and vested
Performance Stock Units, less any amount withheld to pay taxes, to be made to
you. The Company will pay to you the Fair Market Value as of the vesting date of
any fractional share Common Stock (less any amount withheld to pay taxes). No
cash payment shall be made to you prior to the date on which the applicable
Performance Stock Units are earned and vest, in accordance with these Terms and
Conditions of the attached Agreement and these Terms and Conditions.
Furthermore, in no event shall any cash payment be made to you later than sixty
(60) calendar days after the applicable Performance Stock Units are earned and
vest.
8. Taxes.

  a)   You acknowledge that you will consult with your personal tax advisor
regarding the income tax consequences of the grant of the Performance Stock
Units, the earning and vesting of the Performance Stock Units, the receipt of
the cash payment pursuant to Section 7 hereof, and any other matters related to
these Terms and Conditions and the attached Agreement. In order to comply with
all applicable federal or state income, social security, payroll, withholding or
other tax laws or regulations, the Company may take such action, and may require
you to take such action, as it deems appropriate to ensure that all applicable
federal or state income, social security, payroll, withholding or other taxes,
which are your sole and absolute responsibility, are withheld or collected from
you.     b)   You acknowledge that you are responsible for the payment of any
federal, state, local or other taxes that are required to be withheld by the
Company upon the earning and vesting of the Performance Stock Units. In order to
satisfy any applicable federal, state, local or other taxes that are required to
be withheld, the Company shall withhold a portion of the cash payment to be
delivered pursuant to Section 7 hereof in the amount equal to the federal and
state income tax required to be withheld upon such vesting.

9. Adjustments. If any Performance Stock Units are earned and vest subsequent to
any change in the number or character of the Common Stock through any
recapitalization, stock split, reverse stock split, reorganization, merger,
consolidation, split-up, spin-off, combination, repurchase or exchange of shares
or other securities of the Company, issuance of warrants or other rights to
purchase shares or other securities of the Company or other similar corporate
transaction or event that affects the Performance Stock Units covered by this
Award of Performance Stock Units, you shall then receive upon such earning and
vesting of the Performance Stock Units, the number and type of securities or
other consideration which you would have received if such Performance Stock
Units had been earned and vested prior to the event changing the number or
character of the outstanding Common Stock.
10. Covenants. In consideration of benefits described elsewhere in these Terms
and Conditions and the attached Agreement, and in recognition of the fact that,
as a result of your employment with the Company or any of its Affiliates, you
have had or will have access to and gain knowledge of highly confidential or

 

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proprietary information or trade secrets pertaining to the Company or its
Affiliates, as well as the customers, suppliers, joint ventures, licensors,
licensees, distributors or other persons and entities with whom the Company or
any of its Affiliates does business (“Confidential Information”), which the
Company or its Affiliates have expended time, resources, and money to obtain or
develop and which have significant value to the Company and its Affiliates, you
agree for the benefit of the Company and its Affiliates, and as a material
condition to your receipt of benefits described elsewhere in these Terms and
Conditions and the attached Agreement, as follows:

  a)   Non-Disclosure of Confidential Information. You acknowledge that you will
receive access or have received access to Confidential Information about the
Company or its Affiliates, that this information was obtained or developed by
the Company or its Affiliates at great expense and is zealously guarded by the
Company and its Affiliates from unauthorized disclosure, and that your
possession of this special knowledge is due solely to your employment with the
Company or one or more of its Affiliates. In recognition of the foregoing, you
will not at any time during employment or following termination of employment
for any reason, disclose, use or otherwise make available to any third party,
any Confidential Information relating to the Company’s or any Affiliate’s
business, products, services, customers, vendors or suppliers; trade secrets,
data, specifications, developments, inventions and research activity; marketing
and sales strategies, information and techniques; long and short term plans;
existing and prospective client, vendor, supplier and employee lists, contacts
and information; financial, personnel and information system information and
applications; and any other information concerning the business of the Company
or its Affiliates which is not disclosed to the general public or known in the
industry, except for disclosure necessary in the course of your duties or with
the express written consent of the Company. All Confidential Information,
including all copies, notes regarding and replications of such Confidential
Information will remain the sole property of the Company or its Affiliates, as
applicable, and must be returned to the Company or such Affiliates immediately
upon termination of your employment.     b)   Return of Property. Upon
termination of employment with the Company or any of its Affiliates, or at any
other time at the request of the Company, you shall deliver to a designated
Company representative all records, documents, hardware, software and all other
property of the Company or its Affiliates and all copies of such property in
your possession. You acknowledge and agree that all such materials are the sole
property of the Company or its Affiliates and that you will certify in writing
to the Company at the time of delivery, whether upon termination or otherwise,
that you have complied with this obligation.     c)   Non-Solicitation of
Existing or Prospective Customers, Vendors and Suppliers. You specifically
acknowledge that the Confidential Information described in Section 10(a)
includes confidential data pertaining to existing and prospective customers,
vendors and suppliers of the Company or its Affiliates; that such data is a
valuable and unique asset of the business of the Company or its Affiliates; and
that the success or failure of their businesses depends upon their ability to
establish and maintain close and continuing personal contacts and working
relationships with such existing and prospective customers, vendors and
suppliers and to develop proposals which are specific to such existing and
prospective customers, vendors and suppliers. Therefore, during your employment
with the Company or any of its Affiliates and for the twelve (12) months
following termination of employment for any reason, you agree that you will not,
except on behalf of the Company or its Affiliates, or with the Company’s express
written consent, solicit, approach, contact or attempt to solicit, approach or
contact, either directly or indirectly, on your own behalf or on behalf of any
other person or entity, any existing or prospective customers, vendors or
suppliers of the Company or its Affiliates with whom you had contact or about
whom you gained Confidential Information during your employment with the Company
or its Affiliates for the purpose of obtaining business or engaging in any
commercial relationship that would be competitive with the “Business of the
Company” (as defined below in Section 10(e)(i)) or cause such customer, supplier
or vendor to materially change or terminate its business or commercial
relationship with the Company or its Affiliates.     d)   Non-Solicitation of
Employees. You specifically acknowledge that the Confidential Information
described in Section 10(a) also includes confidential data pertaining to
employees and agents of the Company or its Affiliates, and you further agree
that during your employment with the Company or its Affiliates and for the
twelve (12) months following termination of employment for

 

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      any reason, you will not, directly or indirectly, on your own behalf or on
behalf of any other person or entity, solicit, contact, approach, encourage,
induce or attempt to solicit, contact, approach, encourage, or induce any of the
employees or agents of the Company or its Affiliates to terminate their
employment or agency with the Company or any of its Affiliates.     e)  
Non-Competition. You covenant and agree that during your employment with the
Company or any of its Affiliates and for the twelve (12) months following
termination of employment for any reason, you will not, in any geographic market
in which you worked on behalf of the Company or any of its Affiliates, or for
which you had any sales, marketing, operational, logistical or other management
or oversight responsibility, engage in or carry on, directly or indirectly, as
an owner, employee, agent, associate, consultant, partner or in any other
capacity, a business competitive with the Business of the Company. This Section
10(e) shall not apply in the event of a Change in Control as described in
Section 4 above.

  i)   The “Business of the Company” shall mean any business or activity
involved in grocery or general merchandise retailing and supply chain logistics,
including but not limited to grocery distribution, business-to-business portal,
retail support services and third-party logistics, of the type provided by the
Company or its Affiliates, or presented in concept to you by the Company or its
Affiliates at any time during your employment with the Company or any of its
Affiliates.     ii)   To “engage in or carry on” shall mean to have ownership in
such business (excluding ownership of up to one percent (1%) of the outstanding
shares of a publicly-traded company) or to consult, work in, direct or have
responsibility for any area of such business, including but not limited to
operations, logistics, sales, marketing, finance, recruiting, sourcing,
purchasing, information technology or customer service.

  f)   No Disparaging Statements. You agree that you will not make any
disparaging statements about the Company, its Affiliates, directors, officers,
agents, employees, products, pricing policies or services.     g)   Remedies for
Breach of These Covenants. Any breach of the covenants in this Section 10 likely
will cause irreparable harm to the Company or its Affiliates for which money
damages could not reasonably or adequately compensate the Company or its
Affiliates. Accordingly, the Company or any of its Affiliates shall be entitled
to all forms of injunctive relief (whether temporary, emergency, preliminary,
prospective or permanent) to enforce such covenants, in addition to damages and
other available remedies, and you consent to the issuance of such an injunction
without the necessity of the Company or any such Affiliate posting a bond or, if
a court requires a bond to be posted, with a bond of no greater than $500 in
principal amount. In the event that injunctive relief or damages are awarded to
Company or any of its Affiliates for any breach by you of this Section 10, you
further agree that the Company or such Affiliate shall be entitled to recover
its costs and attorneys’ fees necessary to obtain such recovery. In addition,
you agree that upon your breach of any covenant in this Section 10, this Award
of Performance Stock Units shall be immediately and irrevocably forfeited.    
h)   Enforceability of These Covenants. It is further agreed and understood by
you and the Company that if any part, term or provision of these Terms and
Conditions and the attached Agreement should be held to be unenforceable,
invalid or illegal under any applicable law or rule, the offending term or
provision shall be applied to the fullest extent enforceable, valid or lawful
under such law or rule, or, if that is not possible, the offending term or
provision shall be struck and the remaining provisions of these Terms and
Conditions and the attached Agreement shall not be affected or impaired in any
way.

11. Arbitration. You and the Company agree that any controversy, claim or
dispute arising out of or relating to the attached Agreement or the breach of
any of these Terms and Conditions, or arising out of or relating to your
employment relationship with the Company or any of its Affiliates, or the
termination of such relationship, shall be resolved by final and binding
arbitration under the Employment Arbitration Rules and Mediation Procedures of
the American Arbitration Association, or other neutral arbitrator and rules as
mutually agreed to you and the Company, except for claims by the Company
relating to your alleged breach of any of the employee covenants set forth in
Section 10 above. This agreement to arbitrate specifically includes, but is not
limited to, discrimination claims under Title VII of the Civil Rights

 

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Act of 1964 and under state and local laws prohibiting employment
discrimination. Nothing in this Section 11 shall preclude the Company from
pursuing a court action to obtain a temporary restraining order or a preliminary
injunction relating to the alleged breach of any of the covenants set forth in
Section 10. The agreement to arbitrate shall continue in full force and effect
despite the forfeiture of this Award of Performance Stock Units or the
termination of your employment relationship with the Company or any of its
Affiliates. You and the Company agree that any award rendered by the arbitrator
must be in writing and include the findings of fact and conclusions of law upon
which it is based, shall be final and binding, and that judgment upon the final
award may be entered in any court having jurisdiction thereof. The arbitrator
may grant any remedy or relief that the arbitrator deems just and equitable,
including any remedy or relief that would have been available to you or the
Company or its Affiliates had the matter been heard in court. All expenses of
arbitration, including the required travel and other expenses of the arbitrator
and any witnesses, and the costs relating to any proof produced at the direction
of the arbitrator, shall be borne equally by you and the Company unless
otherwise mutually agreed or unless the arbitrator directs otherwise in the
award. The arbitrator’s compensation shall be borne equally by you and the
Company unless otherwise mutually agreed or the law provides otherwise.
12. Severability. In the event that any portion of these Terms and Conditions
and the attached Agreement shall be held to be invalid, the same shall not
affect in any respect whatsoever the validity and enforceability of the
remainder of these Terms and Conditions and the attached Agreement.
13. Interpretations. These Terms and Conditions and the attached Agreement are
subject in all respects to the Plan. A copy of the Plan is available upon your
request. In the event that any provision of these Terms and Conditions or the
attached Agreement is inconsistent with the terms of the Plan, the terms and
provisions of the Plan shall govern. Any question of administration or
interpretation arising under these Terms and Conditions or the attached
Agreement shall be determined by the Committee administering the Plan, and such
determination shall be final, conclusive and binding upon all parties in
interest.
14. No Right to Employment. Nothing in these Terms and Conditions, the attached
Agreement or the Plan shall be construed as giving you the right to be retained
as an employee of the Company. In addition, the Company may at any time dismiss
you from employment, free from any liability or any claim under these Terms and
Conditions and the attached Agreement, unless otherwise expressly provided in
these Terms and Conditions and the attached Agreement.
15. Compensation. Any compensation realized from the receipt or payment of (or
the lapse of restrictions relating to) this Award of Performance Stock Units
shall constitute a special long-term incentive payment to you and whether or not
it is taken into account as compensation in determining the amount of any
benefit under any retirement or other employee benefit plan of the Company or
any of its Affiliates will be determined solely under the terms of those benefit
plans.
16. Headings. Headings are given to the sections and subsections of these Terms
and Conditions and the attached Agreement solely as a convenience to facilitate
reference. Such headings shall not be deemed in any way material or relevant to
the construction or interpretation of these Terms and Conditions and the
attached Agreement or any provision hereof.
17. Governing Law. The internal law, and not the law of conflicts, of the State
of Delaware will govern all questions concerning the validity, construction and
effect of these Terms and Conditions and the attached Agreement.
18. Notice. For purpose of these Terms and Conditions and the attached
Agreement, notices and all other communications provided for in the attached
Agreement, these Terms and Conditions or contemplated by either shall be in
writing and shall be deemed to have been duly given when personally delivered or
when mailed United States certified or registered mail, return receipt
requested, postage prepaid, and addressed, in the case of the Company, to the
Company at:
P.O. Box 990
Minneapolis, MN 55440
Attention: Corporate Secretary

 

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and in the case of you, to you at the most current address shown on your
employment records. Either party may designate a different address by giving
notice of change of address in the manner provided above, except that notices of
change of address shall be effective only upon receipt.

  a)   Notice of Termination by Company. Any purported termination of employment
of you by the Company (whether for Cause or without Cause) shall be communicated
by a Notice of Termination to you. No purported termination of employment of you
by the Company shall be effective without a Notice of Termination having been
given.     b)   Good Reason Notice by You. Any purported termination of
employment by you for Good Reason shall be communicated by a Notice of
Termination to the Company. Your termination of employment will not be for Good
Reason unless (i) you give the Company written notice of the event or
circumstance which you claim is the basis for Good Reason within six (6) months
of such event or circumstance first occurring and (ii) the Company is given
thirty (30) days from its receipt of such notice within which to cure or resolve
the event or circumstance so noticed. If the circumstance is cured or resolved
within said thirty (30) days, your termination of employment will not be for
Good Reason.

19. Definitions. The following terms, and terms derived from the following
terms, shall have the following meanings when used in the Agreement with initial
capital letters unless, in the context, it would be unreasonable to do so.

  a)   Cause shall mean:

  i)   your continued failure to perform your duties with the Company (other
than any such failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is delivered to you
by the Board or an officer of the Company which specifically identifies the
manner in which the Board or the officer believes that you have not
substantially performed your duties;     ii)   the conviction of, or plea of
guilty or nolo contendere to, a felony or the willful engaging by you in conduct
which is materially and demonstrably injurious to the Company;     iii)   your
commission of a material act or material acts of personal dishonesty intended to
result in your substantial personal enrichment at the expense of the Company; or
    iv)   your material violation of Company policies relating to Code of
Business Conduct, Equal Employment Opportunities and Harassment or Workplace
Violence;

      provided, however, that in no event shall Cause exist by virtue of any
action taken by you (A) in compliance with express written directions of the
Board, the Company’s Chief Executive Officer or the officer to whom you report
or (B) in reliance upon the express written consent of the Company’s counsel.  
      In each case above, for a termination of employment to be for Cause, you
must be provided with a Notice of Termination (as described in Section 18(a))
within six (6) months after the Company has actual knowledge of the act or
omission constituting Cause. Whether a termination of employment is for Cause as
provided above will be determined by the Company in its sole discretion based on
all the facts and circumstances.     b)   Change in Control shall be deemed to
have occurred upon any of the following events:

  i)   the acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty percent
(20%) or more of either (A) the then outstanding shares of common stock of the
Company or (B) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors; provided, however, that for purposes of this subsection (i), the
following acquisitions shall not constitute a Change in Control: (A) any
acquisition directly from the Company or (B) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company;

 

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  ii)   the consummation of any merger or other business combination of the
Company, sale or lease of all or substantially all of the Company’s assets or
combination of the foregoing transactions (the “Transactions”) other than a
Transaction immediately following which the stockholders of the Company and any
trustee or fiduciary of any Company employee benefit plan immediately prior to
the Transaction own at least sixty percent (60%) of the voting power, directly
or indirectly, of (A) the surviving corporation in any such merger or other
business combination; (B) the purchaser or lessee of the Company’s assets or
(C) both the surviving corporation and the purchaser or lessee in the event of
any combination of Transactions;     iii)   within any 24-month period, the
persons who were directors immediately before the beginning of such period (the
“Incumbent Directors”) shall cease (for any reason other than death) to
constitute at least a majority of the Board or the board of directors of a
successor to the Company. For this purpose, any director who was not a director
at the beginning of such period shall be deemed to be an Incumbent Director if
such director was elected to the Board by, or on the recommendation of or with
the approval of, at least three-fourths of the directors who then qualified as
Incumbent Directors (so long as such director was not nominated by a person who
has expressed an intent to effect a Change in Control or engage in a proxy or
other control contest); or     iv)   such other event or transaction as the
Board shall determine constitutes a Change in Control.

  c)   CIC Date shall mean the date on which a Change in Control occurs.     d)
  Good Reason shall mean any one or more of the following events occurring
during the two-year period following the CIC Date:

  i)   your annual base salary is reduced below the higher of (A) the amount in
effect on the CIC Date or (B) the highest amount in effect at any time
thereafter;     ii)   your duties and responsibilities or the program of
incentive compensation (including without limitation long term incentive plans
and equity incentive programs), vacation, fringe benefits, perquisites,
retirement and general insurance benefits offered to your are materially and
adversely diminished in comparison to the duties and responsibilities or the
program of such benefits enjoyed by you on the CIC Date; or     iii)   you are
required to be based at a location more than forty-five (45) miles from the
location where you were based and performed services on the CIC Date or your
business travel obligations are significantly increased over those in effect
immediately prior to the CIC Date;

      provided, however, that any diminution of duties or responsibilities that
occurs solely as a result of the fact that the Company ceases to be a public
company shall not, in and of itself, constitute Good Reason.     e)   Notice of
Termination shall mean a written notice which shall indicate the specific
provision in this Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for your termination of
employment under the provisions so indicated.

Original Approval: