OR BECOMES THE BENEFICIAL OWNER
DIRECTLY OR INDIRECTLY, OF SECURITIES OF THE COMPANY REPRESENTING 50% OR MORE OF
THE COMBINED VOTING POWER OF THE COMPANY'S THEN OUTSTANDING SECURITIES, AND (Y)
HAS THE RIGHT TO APPOINT A MAJORITY OF THE MEMBERS OF THE BOARD IN EACH CASE
OTHER THAN BY A MERGER OR OTHER TRANSACTION IN WHICH THE SHAREHOLDERS OF THE
COMPANY IMMEDIATELY PRIOR TO THE MERGER OWN A MAJORITY OF THE SURVIVING ENTITY
OR ITS PARENT;
(II)
ANY STOCKHOLDER OF THE COMPANY (OTHER THAN
THE PARENT OR ANY SUBSIDIARY OF THE PARENT) (X) ACQUIRES A GREATER VOTING
INTEREST IN THE COMPANY'S OUTSTANDING COMMON STOCK THAN THE OH INVESTOR GROUP
AND (Y) HAS THE AUTHORITY TO APPOINT A MAJORITY OF THE MEMBERS OF THE BOARD;
(III)
THE COMPANY ADOPTS A PLAN OF COMPLETE
LIQUIDATION (OTHER THAN A LIQUIDATION INTO PARENT OR ANY SUBSIDIARY OF THE
PARENT) OF THE COMPANY OR CONSUMMATES AN AGREEMENT FOR THE SALE OR DISPOSITION
BY THE COMPANY OF ALL OR SUBSTANTIALLY ALL OF THE COMPANY'S ASSETS TO AN
INDEPENDENT THIRD PARTY;
(IV)
AT ANY TIME PRIOR TO THE IPO, THE FAILURE BY
OH TO DESIGNATE ONE OR MORE OH RELATED PERSONS TO SERVE AS ITS DIRECTORS (IT
BEING UNDERSTOOD THAT IF THE COMPANY IS REQUIRED TO APPOINT INDEPENDENT
DIRECTORS BY LAW OR INTER-DEALER QUOTATION SYSTEM OR EXCHANGE RULES, OR OH'S
DESIGNEE IS OTHERWISE PREVENTED FROM SERVING, OH MAY DESIGNATE NON-OH RELATED
PERSONS TO SERVE AS SUCH); OR
(V)
AT ANY TIME PRIOR TO THE IPO, THE FAILURE OF
OH TO RETAIN AND UTILIZE ITS POWER TO APPOINT MORE THAN 51% OF THE DIRECTORS
APPOINTABLE BY THE OH INVESTOR GROUP (FOR EXAMPLE, IF THE OH INVESTOR GROUP HAS
THE RIGHT TO APPOINT FIVE DIRECTORS, OH SHALL APPOINT AT LEAST THREE DIRECTORS,
AND SUCH DIRECTORS SHALL BE OH RELATED PERSONS OR IF NECESSARY, INDEPENDENT
DIRECTORS).
(K)
DEATH PAYMENT DATE.
HAS THE MEANING SET FORTH IN
SECTION 8(A)(II) HEREOF.
(L)
DISTRIBUTION EVENT.
EACH OF A DRAG-ALONG EVENT,
TAG-ALONG EVENT OR THE IPO.
2
(M)
DISABILITY.
HAS THE MEANING SET FORTH IN DUANE READE INC.'S
DISABILITY INSURANCE PLAN WHETHER OR NOT THE PARTICIPANT PARTICIPATES IN SUCH
PLAN.
(N)
DRAG-ALONG CIC PORTION.
HAS THE MEANING SET FORTH IN
SECTION 6(A)(I) HEREOF.
(O)
DRAG-ALONG PORTION.
HAS THE MEANING SET FORTH IN
SECTION 6(A)(II) HEREOF.
(P)
DRAG-ALONG EVENT.
A DRAG-ALONG SALE AS SUCH TERM IS
DEFINED IN THE STOCKHOLDERS AGREEMENT.
(Q)
EFFECTIVE DATE.
THE CONSUMMATION OF THE TRANSACTION
CONTEMPLATED BY THE MERGER AGREEMENT.
(R)
EQUITY SECURITIES.
HAS THE MEANING ASCRIBED TO SUCH
TERM IN RULE 405 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AS IN EFFECT ON THE DATE HEREOF, AND IN ANY EVENT INCLUDES
ANY COMMON STOCK, ANY LIMITED PARTNERSHIP INTEREST, ANY LIMITED LIABILITY
COMPANY INTEREST AND ANY OTHER INTEREST OR SECURITY HAVING THE ATTENDANT RIGHT
TO VOTE FOR DIRECTORS OR SIMILAR REPRESENTATIVES.
(S)
FAIR MARKET VALUE.
ON ANY DATE OF DETERMINATION, THE
FAIR MARKET VALUE OF A SHARE OF COMMON STOCK (I) IF THE COMMON STOCK