Exhibit 10.48



 







EXHIBIT
10.48




AMENDMENT AND WAIVER 




     THIS AMENDMENT AND WAIVER, dated as of October 28, 2005 (this “Amendment and Waiver”),
is made by and among                      (the “Option Holder”), AT Holdings Corporation, a
Delaware corporation (the “Company”), Argo-Tech Corporation, a Delaware corporation
(“Argo-Tech”), and V.G.A.T. Investors, LLC, a Delaware limited liability company
(“Parent”).



W I T N E S S E T H




     WHEREAS, pursuant to that certain AT Holdings Corporation Nonqualified Stock Option Agreement,
dated as of                      (the “Option Agreement”), by and among the Company, Argo-Tech
and the Option Holder, the Option Holder is the holder of options to purchase an aggregate of
                    shares of common stock of the Company (the “Options”);



     WHEREAS, as part of the transactions contemplated by that certain Merger Agreement (the
“Merger Agreement”), dated September 13, 2005, by and among the Company, Argo-Tech, The
Argo-Tech Corporation Employee Stock Ownership Plan (the “ESOP”), acting therein through
GreatBanc Trust Company in its capacity as trustee of the ESOP, Parent, and Vaughn Merger Sub,
Inc., a Delaware corporation and wholly-owned subsidiary of Parent, as amended, the Merger
Agreement provides that the Option Holder will (i) retain 400 Options that were issued under the
Option Agreement (the “Rollover Securities”), (ii) amend the Option Agreement to provide
that such Rollover Securities will become options to purchase Class A Units of Parent as set forth
herein and (iii) waive his right to receive any amounts that would otherwise be payable pursuant to
the Merger Agreement with respect to such Rollover Securities, and as the result, such Rollover
Securities will not be cancelled as otherwise contemplated by the terms of the Merger Agreement and
no amounts will be paid to the Option Holder in respect thereof pursuant to the Merger Agreement;



     WHEREAS, pursuant to Section 11 of the Option Agreement, the board of directors of the
Company may make adjustments in the securities covered by outstanding options to reflect the
occurrence of certain transactions with respect to the stock of the Company and, pursuant to
Section 13 of the Option Agreement, the Option Agreement may be amended with the consent of
the Option Holder;



     WHEREAS, the parties hereto intend that this Amendment and Waiver shall not constitute a
modification of the Rollover Securities for purposes of Section 409A of the Internal Revenue Code
of 1986, as amended, and the Treasury regulations promulgated thereunder (the “Code”), and
this Amendment and Waiver shall be construed accordingly; and



     WHEREAS, the Option Holder is willing to amend the Option Agreement and provide all such
waivers with respect to such Rollover Securities as are required under the Merger Agreement in
connection with the transactions contemplated thereby, upon the terms and subject to the conditions
set forth below.



 









 





     NOW, THEREFORE, in consideration of the respective covenants and promises contained herein and
for other good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:




	1.	 	Waiver of Right to Receive Merger Consideration. The Option Holder hereby consents
to the Company’s execution and delivery of the Merger Agreement and the consummation of the
transactions contemplated thereby, including the treatment of Rollover Securities, and waives
all of his rights to receive any amounts that would otherwise be payable pursuant thereto with
respect to the Rollover Securities held by the Option Holder.
	 
	2.	 	Amendment to Option Agreement. The Option Holder hereby consents, in accordance with
Section 11 and Section 13 of the Option Agreement, to the following amendments
of the Option Agreement:






	 	(a)	 	The title and preamble of the Option Agreement are hereby deleted in their
entirety and replaced with the following:





“V.G.A.T. Investors, LLC




Nonqualified Unit Option Agreement





     This AGREEMENT (the “Agreement”) is made by and between V.G.A.T. INVESTORS,
LLC, a Delaware limited liability company (the “Company”), AT HOLDINGS CORPORATION,
a Delaware corporation (“ATH”), ARGO-TECH CORPORATION, a Delaware corporation
(“Argo-Tech”), and the individual listed on the signature page of this Agreement
(the “Optionee”). Capitalized terms have the meaning set forth in Section 7 of this
Agreement.”




	 	(b)	 	Section 1 of the Option Agreement is hereby deleted in its entirety and
replaced with the following:
	 
	 	 	 	“1. Grant of Option. The Company hereby assumes, effective as of October 28, 2005,
an option (the “Option”) to purchase the number of Class A Units listed on the
signature page of this Agreement (the “Optioned Units”). Prior to the assumption
thereof by the Company, the Option consisted of an option to acquire from ATH a
number of shares of common stock of ATH (the “Optioned Shares”) equal to the number
of Optioned Units now subject to the Option. The price at which each of the
Optioned Units may be purchased pursuant to this Option shall be listed on the
signature page of this Agreement (the “Option Price”), subject to adjustment as
hereinafter provided, and shall be equal to the Option Price for an Option Share
prior to the assumption of the Option by the Company. The Option is intended to be
a “nonqualified stock option” and shall not be treated as an “incentive stock
option” within the meaning of that term under Section 422 of the Internal Revenue
Code of 1986, as amended, or any successor provision thereto.”
	 
	 	(c)	 	The words “ten (10) years from the Date of Grant” in Section 2 are
hereby deleted and replaced with the words “                    .”





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	 	(d)	 	Section 3(a) of the Option Agreement is hereby deleted in its entirety
and replaced with the following:
	 
	 	 	 	“The Option is immediately exercisable with respect to all Optioned Units. Upon
exercise of the Option with respect to one or more Optioned Units, (i) the Company
shall cause ATH to transfer to Argo-Tech a number of shares of common stock of ATH
equal to the number of Optioned Units, (ii) the Company shall cause Argo-Tech to
transfer the shares of ATH common stock to the Optionee in exchange for payment by
the Optionee to Argo-Tech of the Option Price and (iii) the Optionee shall
contribute shares of ATH common stock to the Company in exchange for the Optioned
Units acquired upon the exercise of the Option.
	 
	 	(e)	 	The words “the Company” in the third sentence of Section 5(a) of the
Option Agreement are hereby deleted and replaced with the words “an Issuer.”
	 
	 	(f)	 	Section 5(b) of the Option Agreement is hereby deleted in its entirety
and replaced with the following:
	 
	 	 	 	“(b) The Optionee may also tender the Option Price by (i) the actual or constructive
transfer to the Company of outstanding Class A Units (or such other Company
securities as the Company’s chief accounting officer, upon consultation with the
Company’s independent accountants, determines the acceptance of which by the Company
will not adversely affect the Company’s tax or accounting position) with a Fair
Market Value on the date of exercise equal to the aggregate exercise price payable
with respect to the Options so exercised (and the number of shares of ATH common
stock issued under Section 3(a) shall be adjusted to reflect the net exercise), (ii)
if authorized by the Board or the Compensation Committee at the time of exercise,
delivery of a full recourse promissory note or notes of the Optionee payable on the
earlier of the closing of an Initial Public Offering or an agreed period of time not
to exceed five years and with such other terms as the Board or the Compensation
Committee may determine from time to time, (iii) by authorizing the Company to
withhold from issuance a number of Class A Units (and ATH and Argo-Tech to withhold
a correlative number of shares of ATH common stock) issuable upon exercise of the
Options which, when multiplied by the Fair Market Value of a Class A Unit on the
date of exercise, is equal to the aggregate exercise price payable with respect to
the Options so exercised or (iv) by any combination of the foregoing methods of
payment.”
	 
	 	(g)	 	Section 5(d) of the Option Agreement is hereby deleted in its entirety.
	 
	 	(h)	 	Section 6(e) is hereby deleted in its entirety and replaced with the
words “September 11, 2011.”
	 
	 	(i)	 	Section 7 of the Option Agreement is hereby deleted in its entirety and
replaced with the following:





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	 	“7. 	 	Definitions.






“Common Stock” means the common stock of any Subsidiary of the Company or of an
Issuer, and any other class or series of authorized capital stock of such Subsidiary
or Issuer which is not limited to a fixed sum or percentage of par or stated value
in respect to the rights of the holders thereof to participate in dividends or in
the distribution of assets upon any liquidation, dissolution or winding up of such
Subsidiary or Issuer.




“Fair Market Value” of a Class A Unit of the Company or Common Stock of an Issuer
means, as of the date in question, (i) following an Initial Public Offering, the
officially-quoted closing selling price of the stock (or if no selling price is
quoted, the bid price) on the principal securities exchange or market on which any
security in respect of the Common Stock of an Issuer is then listed for trading
(including, for this purpose, the New York Stock Exchange or the Nasdaq National
Market) (the “Market”) for the applicable trading day and (ii) prior to an
Initial Public Offering or following an Initial Public Offering, if the Common Stock
of an Issuer is not then listed or quoted in the Market, the Fair Market Value shall
be the fair value of the Class A Units or Common Stock, as applicable, determined in
good faith by the Board using any reasonable method; provided,
however, that when securities received upon exercise of an option are
immediately sold in the open market, the net sale price received may be used to
determine the Fair Market Value of any shares used to pay the exercise price or
applicable withholding taxes and to compute the withholding taxes.




“Issuer” means the Company, any direct or indirect Subsidiary of the Company or any
successor to the Company, any of the capital stock of which the Company distributes
to the holders of Units or that is received by the holders of Units in connection
with a transaction contemplated by Section 4.2 of the Company’s Amended and
Restated Limited Liability Company Agreement, dated as of October 28, 2005, as may
be amended from time to time.




“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 interests thereof is at the time owned or controlled, directly or
indirectly, by any 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,



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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. For purposes hereof, references to a
“Subsidiary” of any Person shall be given effect only at such times that such Person
has one or more Subsidiaries and, unless otherwise indicated, the term “Subsidiary”
refers to a Subsidiary of the Company.”




	 	(j)	 	Section 10(b) of the Option Agreement is hereby deleted in its
entirety;
	 
	 	(k)	 	The words “the Plan” in the penultimate sentence of Section 11 of the
Option Agreement is hereby deleted and replaced with the words “this Agreement.” The
last sentence of Section 11 is hereby deleted in its entirety and replaced with
the following:
	 
	 	 	 	“In the event of a Company Sale (as defined in that certain Securityholders
Agreement, dated as of October 28, 2005, between the Company and its members, as may
be amended from time to time), the Board shall have the right to terminate the
Option and provide in substitution to the Optionee payment in an amount equal to the
Fair Market Value of a Class A Unit on the date of exercise less the
aggregate exercise price payable with respect to the options so exercised.”
	 
	 	(l)	 	Section 13 of the Option Agreement is hereby deleted in its entirety
and replaced with the following:
	 
	 	 	 	This Agreement may be amended from time to time by the Compensation Committee in its
discretion in any manner that it deems appropriate; provided that no such
amendment shall adversely affect in a material manner any of the Optionee’s rights
hereunder without the Optionee’s written consent.
	 
	 	(m)	 	Section 15 of the Option Agreement is hereby deleted in its entirety.
	 
	 	(n)	 	The words “Number of Optioned Shares:                     ” on the signature page
of the Option Agreement are hereby deleted and replaced with the words “Number of Class
A Units:                     .”






Except as expressly set forth in this Amendment and Waiver, all other terms of the Option Agreement
shall remain in full force and effect.




	3.	 	No Modification. Each of the parties hereto agrees that this Amendment and Waiver is
not intended to be a modification for purposes of Section 409A of the Code and shall construe
the terms herein accordingly.
	 
	4.	 	Binding Nature and Benefit. This Amendment and Waiver shall be binding upon and
inure to the benefit of each party hereto and their respective successors and assigns.
	 
	5.	 	Counterparts. This Agreement may be executed in multiple counterparts, each of which
shall be deemed an original, and all of which together shall constitute on and the same
document.





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	6.	 	Facsimile Signature. A facsimile signature of this Agreement has the same effect as
an original signature.
	 
	7.	 	GOVERNING LAW. THIS AMENDMENT AND WAIVER SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
	 
	8.	 	Arbitration.






     (a) Any dispute with regard to this Agreement that is not resolved by mutual agreement,
other than as provided in Section 8(b), shall be resolved by binding arbitration
before the American Arbitration Association (“AAA”) in New York City pursuant to the
rules of AAA. The arbitration shall be governed by the United States Arbitration Act, 9
U.S.C. §§1-16 and shall be conducted in accordance with the rules and procedures of AAA.
Any judgment upon the reward rendered by the arbitrator may be entered in any court having
jurisdiction thereof. The arbitrator’s decision shall set forth a reasoned basis for any
award of damages or findings of liability. The arbitrator shall not have the power to award
damages in excess of actual compensatory damages and shall not multiply actual damages or
award punitive damages, and each party hereby irrevocable waives any claim to such damages.
The costs of AAA and the arbitrator shall be borne by the Company. Each party shall bear
its own costs (including, without limitation, legal fees and fees of any experts) and
out-of-pocket expenses.




     (b) The parties hereby agree and stipulate that in the event of any breach or violation
or violation of this Agreement by any other party hereto, either threatened or actual, the
non-breaching parties’ rights shall include, in addition to any and all other rights
available to any such non-breaching party at law or in equity, the right to seek and obtain
any and all injunctive relief or restraining orders available to it in courts of proper
jurisdiction, so as to prohibit, bar, and restrain any and all such breaches or violations
by any other party hereto. Each of the parties hereto further agrees that no bond need be
filed in connection with any request by any other party hereto for a temporary restraining
order or for temporary or preliminary injunctive relief.




	9.	 	WAIVER OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION, OR CAUSE OF
ACTION (A) ARISING UNDER THIS AGREEMENT OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO IN RESPECT OF THIS AGREEMENT OR ANY OF THE
TRANSACTIONS RELATED HERETO, IN EACH CASE, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE.





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     IN WITNESS WHEREOF, the parties hereto has caused this Amendment and Waiver to be executed and
delivered as of the day and year first above written.



	 	 	 	 	 
	 	AT HOLDINGS CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	ARGO-TECH CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	V.G.A.T. INVESTORS, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	 	 
	 	[Option Holder]