Document:

EX-10.2 DEBT COMMITMENT LETTER

 

EXHIBIT 10.2

April 29, 2008

MedAssets, Inc.

100 North Point Center East,

Suite 200

Alpharetta, Georgia 30022

Re: Credit Agreement dated as of October 23, 2006 (as amended or modified from time to time, the
“Credit Agreement”) by and among MedAssets, Inc., a Delaware corporation (the “Borrower”), the
Guarantors from time to time party thereto, the Lenders from time to time party thereto, and Bank
of America, N.A. (“Bank of America”), as Administrative Agent, Swing Line Lender and L/C Issuer.
Unless otherwise defined herein, capitalized terms shall have the meanings set forth in the Credit
Agreement.

Ladies and Gentlemen:

The Borrower has advised Bank of America and Banc of America Securities LLC (“BAS”) that it intends
to acquire all of the capital stock of Accuro Healthcare Solutions, Inc. (the “Target”) for a
purchase price not exceeding $360 million (based on the market value of common equity of the
Borrower on the date hereof), such purchase price to be paid with a combination of common equity of
the Borrower, approximately $105 million of cash on hand and approximately $110 million of
borrowings under the Credit Agreement (the “Acquisition”).

In connection with the foregoing, BAS is pleased to advise you of its willingness to be the sole
and exclusive lead arranger and book manager (in such capacities, the “Lead Arranger”) to form a
syndicate of financial institutions (collectively, the “Additional Lenders”) reasonably acceptable
to you to provide additional Revolving Commitments in an aggregate amount of $40 million (the
“Facility Increase”), and Bank of America is pleased to offer its commitment to lend all of the
Facility Increase, upon and subject to the terms and conditions set forth in this letter (this
“Commitment Letter”) and in the Summary of Terms and Conditions attached as Exhibit A hereto and
incorporated herein by this reference (the “Summary of Terms”).

Furthermore, BAS is pleased to advise you of its willingness to structure and arrange an amendment
to the Credit Agreement (the “Amendment”) that would require the approval of the Required Lenders
and the approval of Lenders holding a majority of the Revolving Commitments (together, the
“Requisite Lenders”) pursuant to which the Acquisition would be permitted and the Facility Increase
would be effected. Bank of America hereby advises you of its commitment to replace all of the
commitments and/or loans provided by the non-consenting Lenders with its own commitment and/or
loans under the Credit Agreement to the extent necessary to achieve the approval of the Amendment
from the Requisite Lenders.

The commitment of Bank of America hereunder and the undertaking of BAS to provide the services
described herein are subject to the satisfaction of each of the following conditions precedent and
the conditions precedent identified in the Summary of Terms in a manner acceptable to Bank of
America and BAS: (a) the accuracy and completeness in all material respects of all representations
that you and your affiliates make to Bank of America and BAS in this Commitment Letter and your
compliance in all material respects with the terms of this Commitment Letter (including the Summary
of Terms) and your compliance with the Fee Letter (as hereinafter defined); (b) prior to and during
the syndication of the Amendment there shall be no competing offering, placement or arrangement of
any debt securities or bank financing by or on behalf of the Borrower or any of its subsidiaries
and (c) the negotiation,

 

 

execution and delivery of definitive documentation for the Facility Increase and the Amendment
consistent with the Summary of Terms and the Fee Letter or otherwise reasonably satisfactory to
Bank of America and BAS. Notwithstanding anything in this Commitment Letter (including the Summary
of Terms), the Fee Letter, the definitive documentation for the Existing Credit Facility or any
other letter agreement or other undertaking concerning the financing of the Acquisition to the
contrary, (i) the only representations and warranties the accuracy of which shall be a condition to
the availability of the Existing Credit Facility and the Facility Increase (collectively, the “New
Facilities”) on the Closing Date shall be (A) the representations and warranties made by the
Company (as defined in the Purchase Agreement) and each Signing Seller (as defined in the Purchase
Agreement) in the Purchase Agreement as are material to the interests of the Existing Lenders and
the Additional Lenders, but only to the extent that the Borrower has the right to terminate its
obligations under the Purchase Agreement as a result of a breach of such representations and
warranties in the Purchase Agreement and (B) the Specified Representations (as defined below) and
(ii) the terms of the Amendment shall be in a form such that it does not impair availability of the
New Facilities on the Closing Date if the conditions set forth herein and in the Summary of Terms
are satisfied (it being understood that, to the extent any collateral is not or cannot be provided
on the Closing Date (other than (x) the pledge of stock of domestic subsidiaries which may be
perfected by delivery of such stock and (y) the perfection of security interests in domestic assets
which may be perfected solely by the filing of a financing statement under the Uniform Commercial
Code) after your use of commercially reasonable efforts to do so or without undue burden or
expense, then the provision of any such collateral shall not constitute a condition precedent to
the availability of the New Facilities on the Closing Date, but may instead be provided after the
Closing Date pursuant to arrangements to be mutually agreed). For purposes hereof, “Specified
Representations” means the representations and warranties of the Borrower and the Guarantors set
forth in the Credit Agreement relating to (a) corporate existence, (b) corporate power and
authority, (c) the enforceability of the Credit Agreement, the Loan Documents and the Amendment,
(d) due execution and delivery, (e) due execution, delivery and performance does not contravene any
material law, organizational documents or require any material consent from any governmental
authority, (f) Federal Reserve margin regulations, (g) use of proceeds and (h) the Investment
Company Act.

The Lead Arranger intends to commence syndication efforts promptly upon your acceptance of this
Commitment Letter. You agree to actively assist the Lead Arranger in achieving a syndication of
the Facility Increase and approval of the Amendment satisfactory to BAS (it being understood that
the successful syndication (as defined in the Fee Letter) of the Facility Increase and the approval
of the Amendment shall not be a condition precedent to Bank of America’s commitment provided
herein). Such assistance shall include (a) your providing and causing your advisors to provide
Bank of America, BAS and the other Lenders upon request with all information reasonably available
to you or your advisors that is reasonably deemed necessary by Bank of America and BAS to complete
syndication and approval of the Amendment; (b) your using commercially reasonable efforts to ensure
that the syndication efforts of the Lead Arranger benefit from your existing banking relationships
and (c) otherwise using commercially reasonable efforts to assist Bank of America and BAS in their
syndication efforts to the extent reasonably requested by them, including by making your senior
management and advisors available from time to time on reasonable notice to attend or make
presentations regarding the business and prospects of the Borrower and its subsidiaries at one or
more meetings of prospective Additional Lenders.

It is understood and agreed that the Lead Arranger will manage and control all aspects of the
syndication, in consultation with you, including decisions as to the selection of prospective
Additional Lenders (who shall be reasonably acceptable to you), when commitments will be accepted
and the final allocations of the commitments among the Additional Lenders. It is understood that
no Additional Lender participating in the Facility Increase will receive compensation from you in
order to obtain its commitment, except on the terms contained herein. It is also understood and
agreed that the amount and distribution of the fees among the Additional Lenders will be at the
sole and absolute discretion of Bank of America and BAS.

 

 

You hereby represent, warrant and covenant that (a) all information, other than Projections
(defined below), which has been or is hereafter made available to Bank of America, BAS or the
Lenders by you or any of your representatives (or on your or their behalf) in connection with the
transactions contemplated hereby (the “Information”), when taken as a whole, is and on the Closing
Date (as hereinafter defined) will be complete and correct in all material respects and does not
and on the Closing Date will not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements contained therein not misleading, and (b) all
financial projections concerning the Borrower and its subsidiaries and the Target and its
subsidiaries that have been or are hereafter made available to Bank of America, BAS or the Lenders
by you or any of your representatives on or before the Closing Date (the “Projections”) have been
or will be prepared in good faith based upon assumptions that are believed by you to be reasonable
at the time so made available. You agree to furnish us with such Information and Projections as we
may reasonably request and to supplement the Information and the Projections from time to time
until the closing date for the Amendment (the “Closing Date”) so that the representation, warranty
and covenant in the preceding sentence is correct on the Closing Date. In arranging and
syndicating the Facility Increase and the Amendment, Bank of America and BAS are and will be using
and relying on the Information and the Projections (collectively, the “Pre-Commitment Information”)
without independent verification thereof.

You hereby acknowledge that (a) BAS and/or Bank of America will make available Information and
Projections (collectively, “Borrower Materials”) to the proposed syndicate of Additional Lenders by
posting the Borrower Materials on IntraLinks or another similar electronic system (the “Platform”)
and (b) certain of the proposed Lenders may be “public-side” Lenders (i.e., Lenders that do not
wish to receive material non-public information with respect to the Borrower or its securities)
(each, a “Public Lender”). You hereby agree that (w) all Borrower Materials that are to be made
available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum,
shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by
marking Borrower Materials “PUBLIC,” you shall be deemed to have authorized BAS, Bank of America
and the proposed Lenders to treat such Borrower Materials as not containing any material non-public
information with respect to the Borrower or its securities for purposes of United States federal
and state securities laws, it being understood that certain of such Borrower Materials may be
subject to the confidentiality requirements of the definitive credit documentation; (y) all
Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the
Platform designated “Public Investor;” and (z) BAS and Bank of America shall be entitled to treat
any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion
of the Platform not designated “Public Investor.” Notwithstanding the foregoing, you shall be
under no obligation to mark any Borrower Materials “PUBLIC.”

The Borrower agrees to reimburse Bank of America and BAS from time to time on demand for all
documented reasonable out-of-pocket fees and expenses (including, but not limited to, the
reasonable fees, disbursements and other charges of Moore & Van Allen PLLC, as counsel to BAS and
the Administrative Agent) incurred by us in connection with the Facility Increase, the syndication
thereof, the preparation of definitive documentation for the Amendment and the other transactions
contemplated hereby.

You agree to indemnify and hold harmless Bank of America, BAS, each Lender and each of their
affiliates and their respective officers, directors, employees, agents, advisors and other
representatives (each, an “Indemnified Party”) from and against (and will reimburse each
Indemnified Party as the same are incurred for) any and all claims, damages, losses, liabilities
and expenses (including, without limitation, the reasonable documented fees, disbursements and
other charges of counsel) that may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or by reason of (including, without
limitation, in connection with any investigation,

 

 

litigation or proceeding or preparation of a defense in connection therewith) (a) any matters
contemplated by this Commitment Letter or the transactions contemplated hereby or (b) the Facility
Increase, the Amendment and any use made or proposed to be made with the proceeds thereof, except
to the extent such claim, damage, loss, liability or expense is found in a final, nonappealable
judgment by a court of competent jurisdiction to have resulted from such Indemnified Party’s gross
negligence, willful misconduct or breach in bad faith of such Indemnified Party’s obligations
hereunder. In the case of an investigation, litigation or proceeding to which the indemnity in
this paragraph applies, such indemnity shall be effective whether or not such investigation,
litigation or proceeding is brought by you, your equity holders or creditors or an Indemnified
Party, whether or not an Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated hereby are consummated. You also agree that no Indemnified Party shall
have any liability (whether direct or indirect, in contract or tort or otherwise) to you or your
subsidiaries or affiliates or to your or their respective equity holders or creditors arising out
of, related to or in connection with any aspect of the transactions described herein, except to the
extent of direct, as opposed to special, indirect, consequential or punitive, damages determined in
a final non-appealable judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party’s gross negligence, willful misconduct or breach in bad faith of such Indemnified
Party’s obligations hereunder. Notwithstanding any other provision of this Commitment Letter, no
Indemnified Party shall be liable for any damages arising from the use by others of information or
other materials obtained through electronic telecommunications or other information transmission
systems, except to the extent such damages arise from such Indemnified Party’s gross negligence,
willful misconduct or breach in bad faith of such Indemnified Party’s obligations hereunder.

The provisions of the immediately preceding two paragraphs shall remain in full force and effect
notwithstanding termination of this letter or any undertaking hereunder.

This Commitment Letter and the fee letter among you, Bank of America and BAS of even date herewith
(the “Fee Letter”) and the contents hereof and thereof are confidential and, except for disclosure
hereof or thereof on a confidential basis to your accountants, attorneys, financial and other
professional advisors retained by you in connection with the Amendment or as otherwise required by
law, may not be disclosed in whole or in part to any person or entity without our prior written
consent; provided, however, it is understood and agreed that you may disclose (a) this Commitment
Letter but not the Fee Letter in filings with the Securities and Exchange Commission and other
applicable regulatory authorities and stock exchanges and (b) this Commitment Letter and the flex
provisions of the Fee Letter (but not any other provisions of the Fee Letter) to the Target and its
accountants, attorneys, financial or other professional advisors. Further, Bank of America and BAS
shall be permitted to use information related to the syndication and arrangement of the Amendment
in connection with marketing, press releases or other transactional announcements or updates
provided to investor or trade publications.

In connection with all aspects of each transaction contemplated by this letter, you acknowledge and
agree, and acknowledge your affiliates’ understanding, that: (i) the Facility Increase, the
Amendment and any related arranging or other services described in this letter is an arm’s-length
commercial transaction between you and your affiliates, on the one hand, and Bank of America and
BAS, on the other hand, and you are capable of evaluating and understanding and understand and
accept the terms, risks and conditions of the transactions contemplated by this letter; (ii) in
connection with the process leading to such transaction, Bank of America and BAS, each is and has
been acting solely as a principal and is not the financial advisor, agent or fiduciary, for you or
any of your affiliates, stockholders, creditors or employees or any other party; (iii) neither Bank
of America nor BAS has assumed or will assume an advisory, agency or fiduciary responsibility in
your or your affiliates’ favor with respect to any of the transactions contemplated hereby or the
process leading thereto (irrespective of whether Bank of America or BAS has advised or is currently
advising you or your affiliates on other matters) and neither Bank of America nor BAS has any
obligation to you or your affiliates with respect to the transactions

 

 

contemplated hereby except those obligations expressly set forth in this letter; (iv) Bank of
America and BAS and their respective affiliates may be engaged in a broad range of transactions
that involve interests that differ from yours and your affiliates and Bank of America and BAS have
no obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary
relationship; and (v) Bank of America and BAS have not provided any legal, accounting, regulatory
or tax advice with respect to any of the transactions contemplated hereby and you have consulted
your own legal, accounting, regulatory and tax advisors to the extent you have deemed appropriate.
You hereby waive and release, to the fullest extent permitted by law, any claims that you may have
against Bank of America and BAS with respect to any breach or alleged breach of agency or fiduciary
duty.

The provisions of the immediately preceding three paragraphs shall remain in full force and effect
regardless of whether any definitive documentation for the Amendment shall be executed and
delivered, and notwithstanding the termination of this letter or any undertaking hereunder.

This Commitment Letter may be executed in counterparts which, taken together, shall constitute an
original. Delivery of an executed counterpart of this Commitment Letter by telecopier or facsimile
shall be effective as delivery of a manually executed counterpart thereof.

This Commitment Letter shall be governed by, and construed in accordance with, the laws of the
State of New York. Each of you and BAS hereby irrevocably waives any and all right to trial by
jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise)
arising out of or relating to this Commitment Letter, the transactions contemplated hereby and
thereby or the actions of BAS in the negotiation, performance or enforcement hereof. The
undertaking of BAS may be terminated by BAS, if you fail to perform your obligations under this
Commitment Letter on a timely basis.

This Commitment Letter (including the Summary of Terms) and the Fee Letter embody the entire
agreement and understanding among Bank of America, BAS, you and your affiliates with respect to the
Facility Increase and the Amendment and supersedes all prior agreements and understandings relating
to the specific matters hereof. However, please note that the terms and conditions of the
commitment of Bank of America and the undertaking of BAS hereunder are not limited to those set
forth herein or in the Summary of Terms. Those matters that are not covered or made clear herein
or in the Summary of Terms or the Fee Letter are subject to mutual agreement of the parties. No
party has been authorized by Bank of America or BAS to make any oral or written statements that are
inconsistent with this Commitment Letter. This Commitment Letter is not assignable by the Borrower
without our prior written consent and is intended to be solely for the benefit of the parties
hereto and the Indemnified Parties.

This offer will expire at 5:00 p.m. (Eastern time) on April 30, 2008 unless you execute this
Commitment Letter and the Fee Letter and return them to us prior to that time (which may be by
facsimile transmission), whereupon this letter and the Fee Letter (each of which may be signed in
one or more counterparts) shall become binding agreements. Thereafter, this undertaking and
commitment will expire on July 31, 2008 unless definitive documentation for the Facility Increase
and the Amendment is executed and delivered prior to such date. In consideration of the time and
resources that BAS and Bank of America will devote to the Amendment and the Facility Increase, you
agree that, until such expiration, you will not solicit, initiate, entertain or permit, or enter
into any discussions in respect of, any offering, placement or arrangement of any competing senior
credit facility or facilities for the Borrower and its subsidiaries.

 

 

We are pleased to have the opportunity to work with you in connection with this important
financing.

	 	 	 	 	 
	 	Very truly yours,

BANC OF AMERICA SECURITIES LLC

 	 
	 	By:  	/s/ A. Britt Canady
 	 
	 	 	Name:  	A. Britt Canady 	 
	 	 	Title:  	Managing Director 	 
	 

	 	 	 	 	 
	 	BANK OF AMERICA, N.A.

 	 
	 	By:  	/s/ R. Shawn Janko
 	 
	 	 	Name:  	R. Shawn Janko 	 
	 	 	Title:  	Senior Vice President 	 
	 

	 	 	 	 
	ACCEPTED AND AGREED TO

AS OF THE DATE FIRST ABOVE WRITTEN:

MEDASSETS, INC.

 	 
	By:  	/s/ L. Neil Hunn
 	 
	 	Name:  	L. Neil Hunn 	 
	 	Title:  	CFO 	 
	 

 

 

SUMMARY OF TERMS AND CONDITIONS

MEDASSETS, INC.

$40 MILLION FACILITY INCREASE

Capitalized terms not otherwise defined herein have the same meanings

as specified therefor in the commitment letter (the “Commitment Letter”) to which

this Summary of Terms and Conditions is attached.

	 	 	 
	BORROWER:
	 	MedAssets, Inc. (the “Borrower”).

	 
	 	 

	GUARANTORS:
	 	The same guarantors (the “Guarantors”) that
presently guarantee the obligations of the Borrower
under that certain Credit Agreement dated as of
October 23, 2006 (as amended or modified from time
to time, “Existing Credit Facility”) by and among
the Borrower, the guarantors party thereto, the
lenders party thereto (the “Existing Lenders”) and
the Administrative Agent (as defined below).

	 
	 	 

	ADMINISTRATIVE AGENT:
	 	Bank of America, N.A. (the “Administrative Agent”
or “Bank of America”) will act as sole and
exclusive administrative agent.

	 
	 	 

	SOLE LEAD ARRANGER

AND SOLE BOOK MANAGER:
	 	Banc of America Securities LLC (“BAS”).

	 
	 	 

	LENDERS:
	 	A syndicate of financial institutions arranged by
BAS, which institutions shall be acceptable to the
Borrower, the Administrative Agent and BAS
(collectively, the “Additional Lenders”; and
together with the Existing Lenders, the “Lenders”).

	 
	 	 

	FACILITY INCREASE:
	 	A $40 million increase (the “Facility Increase”) in
the Aggregate Revolving Commitments (as defined in
the Existing Credit Facility).

	 
	 	 

	PURPOSE:
	 	The proceeds of the Facility Increase shall be
used: (i) finance the acquisition of Accuro
Healthcare Solutions, Inc. (the “Acquisition”); and
(ii) pay fees and expenses incurred in connection
with the Acquisition; and (iii) for general
corporate purposes.

	 
	 	 

	CLOSING:
	 	The execution of definitive loan documentation, to
occur on or before July 31, 2008 (the “Closing
Date”).

	 
	 	 

	INTEREST RATES:
	 	As set forth in Addendum I.

	 
	 	 

	CONDITIONS PRECEDENT

TO CLOSING:
	 	The Closing (and funding) of the Facility Increase
and the Amendment will be subject to satisfaction
of the conditions precedent set forth below:

 

 

	 	(i)	 	The negotiation,
execution and delivery of definitive documentation
(including, without limitation, customary legal opinions
and other customary closing documents) for the Facility
Increase and the Amendment consistent with the terms set
forth herein and the Fee Letter or otherwise reasonably
satisfactory to BAS, the Administrative Agent and the
Lenders (it being understood that in no event will the
Amendment be less favorable to the Borrower and its
subsidiaries than the terms set forth in the Existing
Credit Facility other than (x) any terms of the
Amendment more restrictive to the Borrower and its
subsidiaries that are identified herein or in the
Commitment Letter or the Fee Letter and (y) the
financial covenants set forth in Section 8.11 of the
Existing Credit Facility which may be amended pursuant
to the Amendment to require no less than a 20% cushion
based on projections provided to Bank of America).
	 
	 	(ii)	 	The purchase
agreement (including all schedules and exhibits thereto)
dated as of the date of the Commitment Letter regarding
the purchase of the Target and its subsidiaries (the
“Purchase Agreement”) and all other agreements,
instruments and documents relating to the Acquisition
shall not be altered, amended or otherwise changed or
supplemented or any condition therein waived, in any
manner that would be adverse in any material respect to
the Borrower or the Lenders without the prior written
consent of the Lead Arranger and the Administrative
Agent. The Acquisition shall have been consummated in
accordance, in all material respects, with the terms of
the Purchase Agreement.
	 
	 	(iii)	 	The
Administrative Agent shall have received evidence
reasonably satisfactory to the Administrative Agent that
(A) the ratio of Consolidated Funded Indebtedness (as
defined in the Existing Credit Facility) of the Borrower
and its subsidiaries at the Closing Date to the
Consolidated EBITDA (which shall be calculated on a pro
forma adjusted basis as of the last day of the twelve
month period most recently ended at least 30 days prior
to the Closing Date reflecting the Acquisition) was not
greater than 4.25 to 1.00, (B) the Consolidated EBITDA
of the Borrower and its subsidiaries (which shall be
calculated on a pro forma adjusted basis as of the last
day of the twelve month period most recently ended at
least 30 days prior to the Closing Date reflecting the
Acquisition) was not less than $80 million and (C) the
Borrower has an unused amount of not less than $20
million under the Aggregate Revolving Commitments after
giving effect to the Acquisition. Set forth on

2

 

	 	 	 	Addendum II is a calculation of adjusted EBITDA for
the fiscal quarters identified on Addendum II.
	 
	 	(iv)	 	There shall not
have occurred since December 31, 2007 any event or
condition that has had or could be reasonably expected,
either individually or in the aggregate, to have (a) a
Material Adverse Effect (as defined below) or (b) a
Company Material Adverse Effect (as defined in the
Purchase Agreement). “Material Adverse Effect” means a
material adverse change in, or a material adverse effect
on, the operations, business, assets, liabilities or
financial condition of the Borrower and its subsidiaries
(after giving effect to the Acquisition), taken as a
whole.
	 
	 	(iv)	 	Receipt of all
governmental, shareholder and third party consents and
approvals required under the Purchase Agreement.
	 
	 	(v)	 	The
Administrative Agent shall have received customary
opinions of counsel to the Borrower and the Guarantors
(which shall cover, among other things, authority,
legality, validity, binding effect and enforceability of
the Amendment and the Facility Increase) and such
customary corporate resolutions, certificates and other
documents as the Administrative Agent shall reasonably
require.
	 
	 	(vi)	 	All accrued fees
and expenses of the Administrative Agent, the Lead
Arranger and the Lenders (including the fees and
expenses of counsel for the Administrative Agent) shall
have been paid.

	 	 	 
	PRICING:
	 	As set forth in Addendum I.

3Exhibit 10.1

 

Exhibit 10.1

[HORIZON LINES, INC. LETTERHEAD]

                                        , 2008

[Name]

[Street]

[City, State]

Dear [Employee’s Name]:

     Horizon Lines, Inc. (the “Company”) has designated you to be a recipient of shares of
common stock of the Company, par value $.01 per share (the “Company Stock”), subject to the
performance restrictions and other terms set forth in this letter agreement and in the Horizon
Lines, Inc. Amended and Restated Equity Incentive Plan (the “Plan”).

     The grant of these shares is made pursuant to the Plan. The Plan is administered by the
Compensation Committee (the “Committee”) appointed by the Board of Directors of the
Company. The terms of the Plan are incorporated into this letter and in the case of any conflict
between the Plan and this letter, the terms of the Plan shall control. A copy of the Plan is
attached to this letter.

     1. Grant. In consideration of your agreements contained in this letter, the Company
hereby grants you
                     shares of Company Stock (the “Restricted Shares”) as of April
24, 2008 (the “Grant Date”), the date on which the Committee met and approved the
granting of this award. The Restricted Shares are subject to performance restrictions as set
forth below. Until these restrictions lapse, the Restricted Shares are forfeitable and
nontransferable.

     2. Vesting. The Restricted Shares shall vest, and become freely transferable, as
follows:

     (a) (i) 100% of the Restricted Shares will vest and become freely transferable as of
April 24, 2011 (the “Initial Vesting Date”), if the earnings per share of Company
Stock for the Company’s fiscal year ended December 26, 2010, as calculated by the Company and
subsequently audited and certified by an independent public accounting firm in accordance
with Statement of Financial Accounting Standards No. 128 (“SFAS 128”), meets or
exceeds $                     per share.

1

 

          (ii) Restricted Shares that do not vest as of the Initial Vesting Date will vest and
become freely transferable as of April 24, 2012 (the “First Subsequent Vesting
Date”), if the earnings per share of Company Stock for the Company’s fiscal year ended
December 25, 2011, as calculated by the Company and subsequently audited and certified by an
independent public accounting firm in accordance with SFAS 128 meets or exceeds $                     per
share.

          (iii) Restricted Shares that do not vest as of the Initial or the First Subsequent
Vesting Date will vest and become freely transferable as of April 24, 2013 (the “Second
Subsequent Vesting Date”), if the earnings per share of Company Stock for the Company’s
fiscal year ended December 23, 2012, as calculated by the Company and subsequently audited
and certified by an independent public accounting firm in accordance with SFAS 128 meets or
exceeds $                     per share.

          (iv) Restricted Shares that do not vest as of the Initial or the First or Second
Subsequent Vesting Dates will vest and become freely transferable as of April 24, 2014 (the
“Final Subsequent Vesting Date”), if the earnings per share of Company Stock for the
Company’s fiscal year ended December 22, 2013, as calculated by the Company and subsequently
audited and certified by an independent public accounting firm in accordance with SFAS 128
meets or exceeds $                     per share.

          (v) Restricted Shares that do not vest as of the Initial or the First, Second or Final
Subsequent Vesting Dates (each hereinafter a “Vesting Date”) shall be forfeited as of
the Final Subsequent Vesting Date.

     (b) You must be continuously employed by the Company (or any Subsidiary) from the Grant
Date until the applicable Vesting Date for any Restricted Shares to vest. Except as provided
in subsection (c) below, if your employment with the Company (or any Subsidiary) terminates
prior to a Vesting Date for any reason, any rights you may have with regard to unvested
Restricted Shares shall be forfeited at that time, notwithstanding your return to active
employment with the Company or any Subsidiary prior to a Vesting Date.

     (c) Notwithstanding subsection (b) above, if, prior to a Vesting Date, your employment
with the Company (or any Subsidiary) terminates due to your voluntary retirement on or after
your attainment of age 591/2 (your “Pre-Vesting Date Retirement”), you will have the
opportunity to vest in a prorated portion of the Restricted Shares as of the applicable
Vesting Date if the performance conditions provided in subsection (a) are met. The prorated
portion of the Restricted Shares in which you will have the opportunity to vest will be equal
to the number of shares you have been awarded under this letter, multiplied by a fraction,
the numerator of which is the number of days from the Grant Date through the date of your
Pre-Vesting Date Retirement and the
denominator of which is the number of days from the Grant Date

2

 

through the applicable
Vesting Date. Restricted Shares that do not vest as of any Vesting Date described in
subsection (a) above shall be forfeited.

     3. Dividends. During the period beginning with the Grant Date and ending with the
applicable Vesting Date or the earlier forfeiture of your Restricted Shares, you will be entitled
to receive dividends and other distributions (collectively, “dividends”) on the Restricted Shares
to the extent dividends are paid by the Company on its authorized and issued shares of Company
Stock to its shareholders of record. These dividends, if any, will be paid to you at the same rate
and at the same time as such dividends are paid by the Company with respect to authorized and
issued shares held by its other shareholders of record.

     4. Power of Attorney. You hereby appoint the Corporate Secretary of the Company as
your attorney in fact, with full power of substitution, and authorize him or her to provide
instructions to the Company’s registrar and transfer agent for Company Stock as the Company may
deem necessary or proper to comply with the intent and purposes of this Agreement and the Plan,
including, upon the occurrence of a forfeiture pursuant to Section 2 above, to notify the registrar
and transfer agent of the forfeiture of such shares, together with instructions to cancel the
shares forfeited. The registrar and transfer agent shall be entitled to rely upon any notices and
instructions delivered by your attorney in fact under the terms of the Plan and this letter.

     5. Book Entry Form; Delivery of Shares. The Company shall, as soon as
administratively feasible after your execution of this letter, direct the Company’s transfer agent
for Company Stock to make a book entry record showing ownership for the Restricted Shares in your
name, subject to the terms and conditions of the Plan and this letter. As soon as practicable
following the date on which the Restricted Shares become nonforfeitable and fully transferable
pursuant to Section 2 above, the Company will issue appropriate instructions to that effect to the
transfer agent for Company Stock.

     6. Rights as a Shareholder. Subject to the provisions of this letter, you generally
will have all of the rights of a holder of Company Stock with respect to all of the Restricted
Shares awarded to you under this letter from and after the Grant Date until the shares either vest
or are forfeited, including the right to vote such shares and to receive dividends or other
distributions paid thereon, as provided in Section 3.

     7. Transfer Restrictions. You may not sell, assign, transfer, pledge, hypothecate or
encumber your right to receive Restricted Shares under this letter prior to the time such
Restricted Shares become fully vested in accordance with this letter.

     8. Fractional Shares. A fractional share of Company Stock will not be issued and any
fractional shares will be disregarded.

3

 

     9. Adjustments. If the number of outstanding shares of Company Stock is increased or
decreased as a result of a stock dividend, stock split or combination of shares, recapitalization,
merger in which the Company is the surviving corporation, or other change in the Company’s
capitalization without the receipt of consideration by the Company, the Performance Target and the
number and kind of your unvested Restricted Shares shall be proportionately adjusted by the
Committee, whose determination shall be binding.

     10. Notices. Any notice to be given under the terms of this letter shall be addressed
to the Corporate Secretary at [Company Address]. Any notice to be given to you shall be given to
you and shall be addressed to you at your last known address at the time notice is sent. Notices
shall be deemed to have been duly given if mailed first class, postage prepaid, addressed as above.

     11. Applicable Withholding Taxes. No Restricted Shares that have become vested and
fully transferable pursuant to Section 2 above shall be delivered to you until you have paid to the
Company the amount that must be withheld under federal, state and local income and employment tax
laws (the “Applicable Withholding Taxes”) or you and the Company have made satisfactory
arrangements for the payment of such taxes. As an alternative to making a cash payment to satisfy
the Applicable Withholding Taxes, the Committee may in its discretion (i) permit you to deliver
shares of Company Stock which you already own (valued at their Fair Market Value as of the delivery
date) in whole or partial satisfaction of such taxes or (ii) have the Company retain that number of
Restricted Shares (valued at their Fair Market Value as of the delivery date) that would satisfy
the Applicable Withholding Taxes.

     12. Applicable Securities Laws. The Company may delay delivery of Restricted Shares
that have become vested and fully transferable pursuant to Section 2 above until (i) the admission
of such shares to listing on any stock exchange on which the Company Stock may then be listed, (ii)
receipt of any required representation by you or completion of any registration or other
qualification of such shares under any state or federal law or regulation that the Company’s
counsel shall determine as necessary or advisable, and (iii) receipt by the Company of advice by
counsel that all applicable legal requirements have been complied with. Additionally, you may be
required to execute a customary written indication of your investment intent and such other
agreements the Company deems necessary or appropriate to comply with applicable securities laws.

     13. Acceptance of Restricted Shares. By signing below, you indicate your acceptance
of these Restricted Shares and your agreement to the terms and conditions set forth in this letter
agreement, which, together with the terms of the Plan, shall become the Company’s Restricted Stock
Award Agreement with you. You also hereby acknowledge receipt of a copy of the Plan and agree to
all of the terms and conditions of the Plan, as it may be amended from time to time. Unless the
Company otherwise agrees in writing, this letter will not be effective as a Restricted Stock Award
Agreement if you do not sign and return a copy.

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     IN WITNESS WHEREOF, the Company has caused this Restricted Stock Award

Agreement to be signed, as of this                      date of                                         , 2008.

	 	 	 	 	 	 	 
	 	 	 	 	HORIZON LINES, INC.
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Its:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Agreed and Accepted:
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

[Name of Grant Recipient]

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

[Date]

	 	 	 	 	 	 

5

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