Pathmark Stores, Inc. Form 8-K






Exhibit 10.1






FIRST AMENDMENT TO 
AMENDED AND RESTATED EMPLOYMENT AGREEMENT


This First Amendment to the Amended and Restated Employment Agreement (the
“First Amendment”) is made this 22nd day of December, 2005 by and
between Pathmark Stores, Inc. (the “Company”) and Frank G. Vitrano
(the “Executive”) in consideration of the mutual covenants herein
contained and benefits to be derived herefrom.


W I T N E S S E T H:


WHEREAS, the Company and Executive have entered into an Amended and Restated
Employment Agreement dated November 20, 2002 (the “Employment
Agreement”).


WHEREAS, the Company and Executive have agreed to amend certain provisions of
the Employment Agreement as set forth herein.


NOW THEREFORE, it is hereby agreed as follows:


	1. 	 Definitions.
All capitalized terms used herein and otherwise defined shall have  the same meaning
herein as in the Employment Agreement.




	2. 	 Amendment
to Section 2. The provisions of Section 2 of the Employment Agreement  are hereby
amended as follows:




By deleting the first sentence of said Section 2 in its
entirety and substituting the following in its stead:



“During the Term, you shall be employed as
Co-President  and Chief Financial Officer of the Company, and your duties and
responsibilities  to the Company shall be consistent in all respects with such position.”



	3. 	 Amendments
to Section 3. The provisions of Section 3 of the Employment  Agreement are hereby
amended as follows:




		(a) 	 by
deleting  subsection (b) of Section 3 of the Employment  Agreement in its entirety and
substituting the  following in its stead:










“(b) Annual Bonus. During the Term, you
shall be eligible to earn  an annual bonus (“Annual Bonus”) pursuant to
the Company’s  Executive Incentive Plan. For each full fiscal year of the Company
during the  Term your target Annual Bonus shall equal 100% of your actual Annual Salary
earned during the applicable fiscal year. Annual Bonus targets and adjustments  for
performance above and below the target will be reasonably set by the Board  in good faith
after consultation with the Chief Executive Officer, such matrix  to provide that the
Annual Bonus will increase above the target of 100% for  performance above target. Your
target Annual Bonus for each partial fiscal year  during the Term shall be prorated based
on the number of days in such fiscal  year occurring during the Term (including any
partial fiscal year ending at the  expiration of the Term due to a non-renewal by either
party, in which case the  Annual Bonus shall be calculated based on performance through
the Date of  Termination). The Annual Bonus for each year, if earned, shall be paid to
you in  cash within 75 days of the end of the applicable fiscal year.”



		(b) 	 By
deleting  subsection (c) of Section 3 of the Employment  Agreement in its entirety and
substituting the  following in its stead:




“(c) Equity Awards. The Company shall grant
you the following equity awards  (the ‘Equity Awards’):



“(i) On December 22, 2005 (the “Grant Date”),
an award  of stock options under the 2000 Employee Equity Plan (the “Plan”) to
purchase 600,000 shares of the Company’s Common Stock (“Common  Stock”) at
an exercise price equal to the Fair Market Value of such Common  Stock on the Grant Date,
pursuant to the terms of an award agreement in the form  of Attachment A.; and



(ii) On the Grant Date, an award under the Plan of
100,000  restricted shares of Common Stock, pursuant to the terms of an award agreement
in the form of Attachment B.”



		(c) 	 By
adding a new subsection (f) of Section 3 of the Employment Agreement as follows:




“(f) Indemnification. The Company shall (i) indemnify,
defend and hold you harmless, to the full extent permitted under applicable law,  for,
from and against any and all losses, claims, costs, expenses, damages,  liabilities or
actions (including security holder actions) related to or arising  out of your employment
with and service as an officer of the Company and/or its  subsidiaries (including with
respect to the appointment of officers and other  employees), and (ii) pay as
incurred all reasonable costs, expenses and  attorneys’ fees incurred by you in
connection with or relating to the  defense of any such losses, claims, costs, expenses,
damages, liabilities or  actions or the enforcement of any indemnification right
hereunder. You shall be  entitled to coverage under any director and officer liability
insurance policies  of the Company to the extent of any other officer of the Company.”









	4. 	 Amendments
to Section 4. The provisions of Section 4 of the Employment  Agreement are hereby
amended as follows:




		(a) 	By
deleting romanette (ii) of subsection (a) of Section 4  of the Employment Agreement in
its entirety and substituting the following in  its stead:




“(ii) subject to your execution of a general
release of  claims against the Company in the form of Attachment C, an amount  (the “Severance
Amount”) equal to (A) two times the  sum of your Salary plus your target
Annual Bonus on the Date of Termination,  plus (B) a pro rata portion of your target
Annual Bonus for the applicable  year (assuming for this purpose that you have met all
the necessary performance  targets for such year at 100% of the performance target) based
upon the number  of days occurring in such year through and including the Date of
Termination.



The Severance Amount shall be payable in cash in 24
equal  monthly installments commencing on the date 30 days after the Date of  Termination
(such 24-month period being referred to as  the “Severance Period”);
provided that, to the  extent required under Section 409A of the Internal Revenue
Code of 1986, as  amended (the “Code”) to avoid the imposition of additional
tax under  that section to you, any payment of the Severance Amount shall commence on the
six-month anniversary of your separation from service with the Company (or, if  earlier,
the date of your death) and continue in equal monthly installments over  the remainder of
the Severance Period; provided further that, to the  extent permitted under
Section 409A of the Code without the imposition of  additional tax under that section to
you, the Severance Amount shall be paid  (A) in an immediate lump-sum in the event
such Involuntary Termination  occurs on or after a Change in Control or (B) in an
immediate lump sum at  the time of a Change in Control (less any amounts previously paid
to you) in the  event that your Involuntary Termination occurs within six months prior to
a  Change in Control. The Company agrees that, in the event that your employment  with
the Company terminates as a result of the Company’s delivering a  notice of
non-renewal in accordance with Section 1 above within six months prior  to a Change in
Control, such termination will be treated as an Involuntary  Termination for purposes of
this Section 4(a).”








		(b) 	(1)
By deleting clause (D) in the definition of “Good  Reason” in romanette (iii)
of subsection (g) of Section 4 of the Employment  Agreement in its entirety and
substituting the following in its stead:




“(D) any failure by the Company to maintain your
principal place of  employment and the executive offices of the Company in the Carteret,
New Jersey  area”.



(2) By adding the following at the end of clause (E) in
the  definition of “Good Reason” in romanette (iii) of subsection (g) of
Section 4 of the Employment Agreement:



“or your failure at any time to report directly to
the Chief Executive  Officer, it being understood that this clause (E) will not be
triggered should  the Company replace the Executive as Chief Financial Officer so long as
the  Chief Financial Officer reports directly to the Executive.”



		(c) 	By
adding the following new definitions to subsection (g)  of Section 4 of the Employment
Agreement:




		“(v)	‘Business’ shall mean the retail or wholesale grocery business.




		(vi) 	‘Change
in Control’ shall mean:




(A)  the individuals who, as of the date of
the First Amendment,  constitute the Board, and subsequently elected members of the Board
whose  election is approved or recommended by at least a majority of the members of the
Board as of the date of the First Amendment or their successors whose election  was so
approved or recommended (other than any subsequently elected members  whose initial
assumption of office occurs as a result of an actual or threatened  election contest with
respect to the election or removal of directors or other  actual or threatened
solicitation of proxies or consents by or on behalf of any  Person (as defined below)
other than the Board), cease for any reason to  constitute at least a majority of the
Board;








(B)  the acquisition of beneficial ownership,
within the meaning of  Rule 13d-3 promulgated under the Securities Exchange Act of 1934,
as amended  (the ‘Exchange  Act’), of 35% or more of the Common
Stock  then outstanding, by any person, entity or group (a ‘Person’),
within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act,  other
than (1) the Company or any of its subsidiaries, (2) an employee  benefit plan
of the Company or trustee or other fiduciary holding securities  under an employee
benefit plan of the Company or person or entity organized,  appointed or established by
the Company for or pursuant to the terms of any such  employee benefit plan, (3) an
underwriter temporarily holding securities  pursuant to an offering of such securities,
(4) an entity owned, directly  or indirectly, by the Company’s stockholders in
substantially the same  proportions as their ownership of Common Stock or (5) Yucaipa;
provided,  however, that a reverse subsidiary merger or similar transaction shall
not  be a Change in Control under this Section 5(g)(vi)(B) if it would not otherwise  be
a Change in Control under Section 5(g)(vi)(C) below; or



(C)  the consummation in one or a series of
transactions, or the  approval of the Company’s stockholders in the case of clause
(1), of either  (1) a plan of complete liquidation or dissolution of the Company or
(2) a merger, amalgamation or consolidation of the Company with any Person,  the
issuance of voting securities of the Company or any subsidiary in connection  with a
merger, consolidation or recapitalization of the Company or a subsidiary,  the sale or
other disposition of all or substantially all of the assets of the  Company to any Person
or the acquisition of assets of any Person or other  business combination or transaction
(each, a ‘Business  Combination’), unless, in each case of a
Business Combination,  immediately following such Business Combination, all or
substantially all of the  individuals and entities who were the beneficial owners of the
Common Stock  outstanding immediately prior to such Business Combination beneficially
own,  directly or indirectly, more than 50% of the then outstanding shares of Common
Stock and 50% of the combined voting power of the then outstanding voting  securities
entitled to vote generally in the election of directors, as the case  may be, of the
entity resulting from such Business Combination (including,  without limitation, an
entity which as a result of such transaction owns the  Company or all or substantially
all of the assets of the Company and its  subsidiaries either directly or through one or
more subsidiaries) in  substantially the same proportions as their ownership, immediately
prior to such  Business Combination, of the Common Stock.








Notwithstanding the foregoing, in no event shall a
Change in  Control result from (I) any increase in Yucaipa’s beneficial ownership of
equity of the Company or (II) the acquisition by Yucaipa of all or  substantially
all of the business or assets of the Company.



(vii) ‘Excluded Location’ means a
25-mile  radius of any location where the Company operates its business.



(viii) ‘Fair Market Value’ means Fair
Market  Value as defined in the Plan as on the date of the First Amendment .



(ix)‘Yucaipa’ means The Yucaipa
Companies,  LLC, and each Person or entity controlled by, controlling or under common
control with The Yucaipa Companies, LLC, including, without limitation,  investment funds
or other investment entities.”



		(b) 	 By
adding a new subsection (h) to Section 4 of the Employment Agreement as follows:




“(h) Treatment of Equity Awards. The
treatment of your Equity  Awards in connection with the termination of your employment
with the Company  shall be as set forth in the award agreements described in Section 3(c)
above.”



	5. 	 Amendments
to Section 5. The provisions of Section 5 of the Employment  Agreement are hereby
amended as follows:




By deleting subsection (a) of Section 5 of the
Employment  Agreement in its entirety and substituting the following in its stead:








“(a) No Competing Employment. During the
period  beginning on the Effective Date and ending on the later of (i) the last day of
the Term, or (ii) to the extent you are being paid Severance Amounts, the last  day of
the Severance Period (the “Restricted Period”), you  shall not,
without the prior written consent of the Company, directly or  indirectly, whether as
owner, consultant, employee, partner, venturer, or agent,  through stock ownership,
investment of capital, lending of money or property,  rendering of services, or otherwise
(except ownership of less than 5% of the  number of shares outstanding of any securities
which are publicly traded), (i)  compete in any Excluded Location with the Business or
(ii) provide services to,  whether as an employee or consultant, own, manage, operate,
control, participate  in or be connected with (as a stockholder, partner, or any similar
ownership  interest) any corporation, firm, partnership, joint venture, sole
proprietorship  or other entity that competes with the Business in any Excluded Location,
except  for the aforementioned 5% ownership of publicly traded securities.
Notwithstanding the foregoing provisions of this Section 6(a), (i) an  entity will
be treated as competing with the Business in an Excluded Location  only if such entity
operates (A) a store that is typically considered to be  a “supermarket” or
“supercenter” or (B) a “wholesale  grocery business” (as such terms
are reasonably and customarily understood  in the Business) in such Excluded Location;
and (ii) you will not be in  violation of this Section 6(a) if you are employed by
or providing services to a  regional chain of stores that is affiliated with another
entity that competes  with the Business in an Excluded Location, so long as (A) such
regional  chain does not compete with the Business in any Excluded Location and  (B) you
do not render services in any capacity to such other entity other  than the services
rendered to such regional chain.”



	6. 	 Amendments
to Section 9. The provisions of Section 9 of the Employment  Agreement are hereby
amended as follows:




By adding a new subsection  (h) of Section 9 of the
Employment Agreement as follows:



“(h) Section 409A. The provisions of this
Employment Agreement are intended to satisfy the applicable requirements of  Section 409A
and shall be performed and interpreted consistent with such intent.  If any provision of
this Agreement does not satisfy such requirements or could  otherwise cause you to be
subject to the interest and penalties under Section  409A, you and the Company agree to
negotiate in good faith an appropriate  modification to maintain, to the maximum extent
practicable, the original intent  of the applicable provision without violating the
requirements of Section 409A  (or causing the imposition of additional tax on you under
Section 409A).”



	7. 	 Except
as provided herein,  all terms and conditions of the Employment  Agreement  remain in
full force and  effect.













IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to be
executed on the date first above written.






PATHMARK STORES, INC.



By: /s/ John T. Standley

John T. Standley

Chief Executive Officer


/s/ Frank G. Vitrano

Frank G. Vitrano










ATTACHMENT A


Pathmark Stores, Inc.

200 Milik Street

Carteret, New Jersey 07008


December 22, 2005



Mr. Frank Vitrano 
2 Thatchwood Court 
North Brunswick, NJ  08902


Award Agreement


Dear Mr. Vitrano:


          Pursuant to and subject to
the terms and conditions set forth in this award agreement (“Award
Agreement”), Pathmark Stores, Inc. (the “Company”) hereby
grants you, effective as of the date hereof (the “Grant Date”), a stock option
(“Stock Option”) under its 2000 Employee Equity Plan (the
“Plan”) to purchase the number of shares of Common Stock set forth below. Terms
not defined in this Award Agreement, but defined in the Amended and Restated Employment
Agreement dated November 20, 2002, as amended by the First Amendment to said Amended and
Restated Employment Agreement dated December 22, 2005 between you and the Company
(the “Employment Agreement”), shall have the meaning set forth in
the Employment Agreement.


     1. Stock Option. Your Stock Option shall entitle
you to purchase an aggregate of 600,000 shares of Common Stock (“Option
Shares”) at an exercise price per share (“Exercise Price”) equal
to $10.13. The Stock Option is a not an “incentive stock option” within the
meaning of Section 422 of the Code.


     2. Vesting. Subject to the other terms and
conditions of the Award Agreement and your continued employment with the Company on the
applicable vesting date, your Stock Option shall vest and become exercisable in three
equal annual installments of 200,000 Option Shares each on each of the first three
anniversaries of the Grant Date. Vesting of your Stock Option may be accelerated in
accordance with the Section 5 below.








     3. Compliance with Securities Laws.
Notwithstanding anything to the contrary contained herein, your Stock Option may not be
exercised unless the shares of Common Stock issuable upon exercise of your Stock Option
are then registered under the United States Securities Act of 1933, as amended
(the “Securities Act”) or, if such shares are not then
so registered, the Company has determined that such exercise and issuance would be exempt
from the registration requirements of the Securities Act. The exercise of your Stock
Option must also comply with other applicable laws and regulations governing the Stock
Option, and the Stock Option may not be exercised if the Company determines that the
exercise would not be in material compliance with such laws and regulations.


     4. Option Term. Subject to the other terms and
conditions of this Award Agreement, the term of your Stock Option shall commence on the
Grant Date and shall expire on the tenth anniversary thereof (the “Expiration
Date”).


     5. Termination of Employment; Change in Control.


          (a) In the event that your
employment with the Company is terminated by reason of your Involuntary Termination,
except as otherwise expressly provided in this Section 5, your Stock Option shall be
considered fully vested and shall remain exercisable until the third anniversary of the
Date of Termination.


In the event the Date of Termination occurs (A) on or after the third
anniversary of the Grant Date, (B) on or after a Change in Control, or
(C) within six months prior to a Change in Control and such Involuntary
Termination prior to the Change in Control was requested by a party to, or was
otherwise in connection with, the Change in Control, your Stock Option shall be
fully vested and shall remain exercisable (to the extent not previously
exercised) until the third anniversary of the Date of Termination.


In the event that you resign from your employment with the Company without
Good Reason and the Date of Termination is prior to the third anniversary of the
Grant Date, the vested portion of your Stock Option shall remain exercisable
until the end of the 90-day period following the Date of Termination and the
unvested portion of your Stock Option shall be forfeited. In the event that your
employment with the Company is terminated by reason of your death or Disability
and the Date of Termination is prior to the third anniversary of the Grant Date,
except as otherwise expressly provided in this Section 5, the vested portion of
your Stock Option on the Date of Termination shall remain exercisable until the
third anniversary of the Date of Termination, and the unvested portion of your
Stock Option shall be forfeited. In the event that your employment with the
Company is terminated for any reason other than your termination for Cause and
the Date of Termination is on or following the third anniversary of the Grant
Date, your Stock Option shall be fully vested and, except as otherwise expressly
provided in this Section 5, shall remain exercisable until the third anniversary
of the Date of Termination. Upon termination of your employment by the Company
for Cause, the vested and unvested portion of your Stock Option shall be
forfeited.








          (b) In the event of a
Change in Control, your Stock Option shall become fully vested immediately prior thereto;
provided, however, that the Compensation Committee of the Board
(the “Committee”) may elect in its sole discretion prior to a Change
in Control not to vest your Stock Option in connection with such Change in Control if
(i) it reasonably determines in good faith that not accelerating the unvested portion
of your Stock Option is necessary or advisable to consummate the Change in Control,
(ii) immediately following the Change in Control you are the Co-President and Chief
Financial Officer (or if you are not the Chief Financial Officer, the Chief Financial
Officer reports to you) of the surviving corporation in the Change in Control, which
surviving corporation is at least comparable in size to the Company immediately prior to
the Change in Control and any related transactions, (iii) such surviving corporation
has a publicly traded class of common stock and (iv) either (A) the Company is
the surviving corporation in the Change in Control or (B) your Stock Option is
assumed or replaced by such surviving corporation; provided further that if the
Committee so elects not to vest the unvested portion of your Stock Option in connection
with a Change in Control, subject to the other terms and conditions of this Award
Agreement and your continued employment with the Company on the applicable vesting date,
the portion of your Stock Option that is unvested after the date of the Change in Control
shall become fully vested on the six-month anniversary of the Change in Control or, if
earlier, in accordance with the other, applicable vesting provisions of this Award
Agreement.


          (c) In the event of a
transaction described in clause (vii) of the definition of Good Reason in that certain
Employment Agreement dated August 23, 2005 by and between the Company and John Standley,
filed as Exhibit 10.2 to the Company’s Form 8-K filed with the Securities and
Exchange Commission on August 25, 2005 (whether or not Yucaipa has a controlling interest
within the meaning of such clause), your Stock Option shall become fully vested
immediately prior to such transaction.


          (d) Notwithstanding
anything in this Award Agreement or the Employment Agreement to the contrary, in the event
of any merger or consolidation of the Company or other transaction following which either
the Company is not the surviving corporation or the Common Stock ceases to be publicly
traded, the Committee shall provide for:


      (i)  the
substitution by the surviving corporation  or the Company’s parent corporation for
your outstanding Stock Option of  stock option(s) on the same terms as your Stock Option,
and which preserve(s)  the economic value to you of your outstanding Stock Option; or



      (ii)  where
all of the holders of the then  outstanding Common Stock (other than Yucaipa) receive
payment in cash or cash  equivalents in consideration for such Common Stock, the
cancellation of your  Stock Option upon payment to you of a per share amount in cash or
cash  equivalents equal to (A) the highest price paid for a share of Common Stock
in such transaction, minus (B) the exercise price of your Stock Option.









     6. Exercise of Stock  Option. You may exercise
your  Stock Option, to the extent vested, in whole or in  part during its term by
delivering a  written notice of exercise (in a form designated by  or otherwise
reasonably acceptable to  the Company) together with the exercise price to  the Secretary
of the Company, or to such  other person as the Company may designate,  during regular
business hours, together with  such additional documents as the Company  may then
require. The Stock Option may be  exercised for whole shares of Common Stock  only.
Payment of the exercise price is due in  full upon exercise of all or any part of  your
Stock Option. You may elect to make payment  of the exercise price to the Company (i) by
cash or check, (ii) by delivery of other  shares of Common Stock with a value equal to
the exercise price that, in the case of  shares acquired previously from the Company,
have been owned by you for at least six  months on the date of delivery, or (iii) a
combination of any of (i) and (ii). At  your discretion, subject to reasonable procedures
adopted by the Committee, the Stock  Option may also be exercised on a cashless basis
through a broker, whereby irrevocable  instructions are delivered to the broker to sell
that number of shares equal in value to  the aggregate Exercise Price of the Option
Shares with respect to which the Stock Option  is then being exercised and pay the
proceeds to the Company. As soon as reasonably  practicable after receipt of such notice
of exercise and full payment of the applicable  Exercise Price and any required tax
withholding, consistent with the regular settlement  policy and procedures of the
Company, the Company shall issue or transfer to you the  number of Option Shares with
respect to which your Stock Option is exercised, less any  Option Shares withheld in
accordance with Section 9 below.


     7. Transferability. Your Stock Option is not
transferable by you otherwise than (i) to or from a Permitted Transferee,
(ii) to a designated beneficiary upon death or (iii) by will or the laws of
descent and distribution, and is exercisable during your lifetime only by you or a
Permitted Transferee (or, in the event of your or a Permitted Transferee’s
adjudicated incapacity, your or Permitted Transferee’s personal representative). No
other assignment or transfer of all or any part of the Stock Option, or of the rights
represented thereby, whether voluntary or involuntary, by operation of law or otherwise,
shall vest in the assignee or transferee any interest or right herein whatsoever and no
assignment or transfer of all or any part of the Stock Option to a Permitted Transferee
shall be given effect unless such Permitted Transferee acknowledges in a writing
satisfactory to the Company that the Stock Option (and any Option Shares acquired pursuant
thereto) remains subject to the provisions of this Award Agreement and the Employment
Agreement. For purposes of this Award Agreement, “Permitted Transferee”
shall mean (i) any member of your immediate family and (ii) any living trust or other
entity established by your or any Permitted Transferee for estate planning purposes. By
way of clarification, transfers of the Stock Option shall be permitted from any Permitted
Transferee to you or between Permitted Transferees.


     8. Not a Service Contract. Your Stock Option is
not an employment or service contract, and nothing therein shall be deemed to create in
any way whatsoever any obligation on your part to continue in the employ of the Company or
one of its subsidiaries, or of the Company or any of its subsidiaries to continue your
employment. In addition, nothing herein shall obligate the Company or any of its
subsidiaries, their respective shareholders, Boards of Directors, officers or employees to
continue any relationship that you might have as a director, advisor or consultant for the
Company or its subsidiaries.


     9. Withholding. You may satisfy any applicable tax
withholding obligation relating to the exercise or acquisition of Common Stock under your
Stock Option by any of the following means or by a combination of such means:
(a) tendering a cash payment; (b) authorizing the Company to withhold shares
from the shares of Common Stock otherwise deliverable to you as a result of the exercise
of your Stock Option (but no more than the minimum required withholding liability and
provide that the payment of the taxes by the Company will not result in a breach of any
contract to which it is a party); or (c) delivering to the Company owned and
unencumbered shares of Common Stock that, in the case of shares acquired previously from
the Company, you have owned for at least six months prior to such delivery.







     10. Notices. Any notices in connection herewith
shall be given in the manner contemplated under the Employment Agreement.


     11. Employment Agreement. In the event of any
conflict between the provisions of this Award Agreement and those of the Employment
Agreement, the provisions of this Award Agreement shall control.


     12. Governing Law. The validity, interpretation,
construction and performance of this Award Agreement shall be governed by the laws of the
State of Delaware applicable to contracts entered into and performed in such state.


     13. Section 409A. Your Stock Option is intended
not to provide for a “deferral of compensation” within the meaning of Section
409A, and this Award Agreement shall be interpreted consistent with such intent. If any
provision of this Award Agreement causes your Stock Option to be subject to the
requirements of Section 409A, or could otherwise cause you to be subject to tax or the
interest and penalties under Section 409A, such provision shall be modified to maintain,
to the maximum extent practicable, the original intent of the applicable provision without
violating the requirements of Section 409A and the Company agrees to modify such
provisions in such manner.


          Please indicate your
acceptance of the foregoing by signing and dating where indicated below.





 Sincerely,





John T. Standley

Chief Executive Officer



Acknowledged and Agreed as of this 22nd day of December, 2005.


_________________________

 Frank G. Vitrano








ATTACHMENT B


Pathmark Stores, Inc.

200 Milik Street

Carteret, New Jersey 07008


December 22, 2005



Mr. Frank Vitrano 
2 Thatchwood Court 
North Brunswick, NJ  08902


Award Agreement


Dear Mr. Vitrano:


          Pursuant to and subject to
the terms and conditions set forth in this award agreement (“Award
Agreement”), Pathmark Stores, Inc. (the “Company”) hereby
grants you effective as of the date hereof (the “Grant Date”) an award of
restricted stock (“Award”) under its 2000 Employee Equity Plan (the
“Plan”) consisting of the number of restricted shares of Common Stock set forth
below. Terms not defined in this Award Agreement, but defined in the Amended and Restated
Employment Agreement dated November 20, 2002, as amended by the First Amendment to said
Amended and Restated Employment Agreement dated December 22, 2005 between you and the
Company (the “Employment Agreement”), shall have the meaning set
forth in the Employment Agreement.


     1. Award. Your Award shall consist of 100,000
shares of Common Stock (the “Award Shares”), which shall be subject
to the forfeiture and transfer restrictions set forth in this Award Agreement. Except as
otherwise expressly provided herein, you shall possess all incidents of ownership of the
Award Shares granted hereunder.


     2. Vesting. Subject to the other terms and
conditions of the Award Agreement and your continued employment with the Company on the
applicable vesting date, your Award Shares shall vest and the restrictions under the Award
shall lapse as to (a) 8,700 shares on the three-month anniversary of the Grant Date, and
(b) 91,300 shares in eleven equal quarterly installments of 8,300 shares commencing on the
six-month anniversary of the Grant Date.


     3. Termination of Employment; Change in Control.


          (a) In the event that your
employment with the Company is terminated by reason of your Involuntary Termination, your
Award shall be considered fully vested and, to the extent previously unvested, the
restrictions shall lapse in full. Upon termination of your employment for any reason other
than your Involuntary Termination, the unvested portion of your Award shall be forfeited,
except that, in the event of your death or Disability, you shall vest pro rata in
the portion of the Award Shares that are scheduled to vest on the last day of the vesting
quarter in which your employment ends as a result of your death or Disability.







          (b) In the event of a
Change in Control, your Award shall become fully vested immediately prior thereto.


          (c) In the event of a transaction
described in clause (vii) of the definition of Good Reason in that certain Employment
Agreement dated August 23, 2005 by and between the Company and John Standley, filed as
Exhibit 10.2 to the Company’s Form 8-K filed with the Securities and Exchange
Commission on August 25, 2005 (whether or not Yucaipa has a controlling interest within
the meaning of such clause), your Award shall become fully vested immediately prior to
such transaction.


     4. Compliance with Securities Laws.


          Notwithstanding anything to
the contrary contained herein, the shares of Common Stock issuable upon vesting of your
Restricted Stock Unit may not be issued unless such shares are then registered under the
United States Securities Act of 1933, as amended (the “Securities
Act”) or, if such shares are not then so registered, the Company has
determined that such issuance would be exempt from the registration requirements of the
Securities Act. The issuance of such shares must also comply with other applicable laws
and regulations governing the Restricted Stock Unit, and such shares may not be issued if
the Company determines that the issuance would not be in material compliance with such
laws and regulations.


     5. Transferability. Award Shares are not
transferable by you prior to the lapsing of restrictions on the applicable Award Shares
otherwise than (i) to or from a Permitted Transferee, (ii) to a designated
beneficiary upon death or (iii) by will or the laws of descent and distribution. No
other assignment or transfer of all or any part of the Award Shares, or of the rights
represented thereby, whether voluntary or involuntary, by operation of law or otherwise,
shall vest in the assignee or transferee any interest or right herein whatsoever and no
assignment or transfer of all or any part of the Award Shares to a Permitted Transferee
shall be given effect unless such Permitted Transferee acknowledges in a writing
satisfactory to the Company that the applicable Award Shares remains subject to the
provisions of this Award Agreement and the Employment Agreement. For purposes of this
Award Agreement, “Permitted Transferee” shall mean (i) any member of
your immediate family and (ii) any living trust or other entity established by your
or any Permitted Transferee for estate planning purposes. By way of clarification,
transfers of the Award Shares shall be permitted from any Permitted Transferee to you or
between Permitted Transferees.


     6. Not a Service Contract. Your Award is not an
employment or service contract, and nothing therein shall be deemed to create in any way
whatsoever any obligation on your part to continue in the employ of the Company or one of
its subsidiaries, or of the Company or any of its subsidiaries to continue your
employment. In addition, nothing herein shall obligate you or the Company or any of its
subsidiaries, their respective shareholders, Boards of Directors, officers or employees to
continue any relationship that you might have as a director, advisor or consultant for the
Company or its subsidiaries.







     7. Withholding. You may satisfy any applicable tax
withholding obligation relating to the vesting of your Award by any of the following means
or by a combination of such means: (a) tendering a cash payment; (b) authorizing
the Company to sell shares subject to your Award, including by withholding a sufficient
amount of such shares otherwise receivable by you (but no more than the minimum required
withholding liability arising from the vesting of the Award Shares and provided that the
payment of the taxes by the Company will not result in a breach of any contract to which
it is a party); or (c) delivering to the Company owned and unencumbered shares of
Common Stock that, in the case of shares acquired previously from the Company, you have
owned for at least six months prior to such delivery.


     8. Notices. Any notices in connection herewith
shall be given in the manner contemplated under the Employment Agreement.


     9. Employment Agreement. Your Award is subject to
and conditional in all respects on the effectiveness of the Employment Agreement and shall
be void ab initio and without force and effect in the event that any condition to
such effectiveness is not met. In the event of any conflict between the provisions of this
Award Agreement and those of the Employment Agreement, the provisions of this Award
Agreement shall control.


     10. Governing Law. The validity, interpretation,
construction and performance of this Award Agreement shall be governed by the laws of the
State of Delaware applicable to contracts entered into and performed in such state.


     11. Section 409A. Your Award is intended not to
provide for a “deferral of compensation” within the meaning of Section 409A, and
this Award Agreement shall be interpreted consistent with such intent. If any provision of
this Award Agreement causes your Award to be subject to the requirements of Section 409A,
or could otherwise cause you to be subject to tax or the interest and penalties under
Section 409A, such provision shall be modified to maintain, to the maximum extent
practicable, the original intent of the applicable provision without violating the
requirements of Section 409A and the Company agrees to modify such provisions in such
manner.


          Please indicate your
acceptance of the foregoing by signing and dating where indicated below.





 Sincerely,





John T. Standley

Chief Executive Officer



Acknowledged and Agreed as of this 22nd day of December, 2005.


________________________

 Frank G. Vitrano







ATTACHMENT C


Release



          I, the undersigned Frank G.
Vitrano, in consideration of the payments and benefits provided to me under the Employment
Agreement dated December 22, 2005, between Pathmark Stores, Inc.
(the “Company”) and me (the “Agreement”),
including the Severance Amount (as defined in the
Agreement)(the “Payments”), and after consultation with counsel, I,
for myself and on behalf of each of my heirs, executors, administrators, representatives,
agents, successors and assigns (collectively, the “Releasors”),
hereby irrevocably and unconditionally release and forever discharge the Company and its
subsidiaries and affiliates (the “Company Group”) and each of their
respective officers, employees, directors, shareholders and agents from any and all
claims, actions, causes of action, rights, judgments, obligations, damages, demands,
accountings or liabilities of whatever kind or character (collectively,
“Claims”), including, without limitation, any Claims under any federal,
state, local or foreign law, that the Releasors may have, or in the future may possess,
arising out of (i) my employment relationship with and service as an employee,
officer or director of the Company Group, and the termination of such relationship or
service, (ii) the Agreement, or (iii) any event, condition, circumstance or
obligation that occurred, existed or arose on or prior to the date hereof; provided,
however, that this Release shall not apply to (i) the obligations of the Company
under the Agreement (including, without limitation, as to Salary, Annual Bonus,
reimbursements, Severance Amount, Equity Awards and continuing medical benefits) and
(ii) any indemnification rights I may have in accordance with the Company’s
governance instruments or the Agreement or under any director and officer liability
insurance maintained by the Company. Other than as contemplated above, the Releasors
further agree that the payments and benefits described in this Release shall be in full
satisfaction of any and all Claims for payments or benefits, whether express or implied,
that the Releasors may have against the Company Group arising out of my employment
relationship or my service as an employee, officer and director of the Company Group and
the termination thereof.


          In further consideration of
the Payments, the Releasors hereby unconditionally release and forever discharge the
Company Group, and each of their respective officers, employees, directors, shareholders
and agents from any and all Claims that the Releasors may have as of the date hereof
arising under the Federal Age Discrimination in Employment Act of 1967, as amended, and
the applicable rules and regulations promulgated thereunder (“ADEA”). By
signing this Release, I hereby acknowledge and confirm the following: (i) I was
advised by the Company in connection with my termination of employment to consult with an
attorney of my choice prior to signing this Release and to have such attorney explain to
me the terms of this Release, including, without limitation, the terms relating to my
release of claims arising under ADEA and, I have in fact consulted with an attorney;
(ii) I was given a period of not fewer than 21 days to consider signing this Release
and to consult with an attorney of my choosing with respect thereto; (iii) I am
providing this Release only in exchange for consideration in addition to anything of value
to which I am already entitled; and (iv) I knowingly and voluntarily am providing
this Release.






________________________________



Date: __________________________










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