Document:

EXHIBIT 10.44

 

NIL COST OPTION AGREEMENT

 

VERTIS HOLDINGS, INC.

1999 EQUITY AWARD PLAN

 

GRANTEE: ADRIAAN ROOSEN

 

NO. OF SHARES: 5,497

 

This Agreement (the “Agreement”),
approved by Thomas H. Lee Equity Fund IV, L.P. (the “Sponsor”),
evidences the award of an option (“Option”) to
acquire 5,497 shares (each, an “Option Share,”
and collectively, the “Option Shares”)
of the Common Stock of Vertis Holdings, Inc., a Delaware corporation (the “Company”), granted to you, Adriaan
Roosen, effective as of July 27, 2004 (the “Grant
Date”), pursuant to the Vertis Holdings, Inc. 1999 Equity Award
Plan (the “Plan”) and subject to the
terms described below.  All of the
provisions of the Plan are expressly incorporated into this Agreement.

 

You
must return to Jennifer M. Bass an executed copy of this Agreement within 10
Business Days after the date indicated below the name of the officer who signed
this Agreement on behalf of the Company. 
If you fail to do so, the Option will be forfeited without consideration
and this Agreement will be null and void.

 

1.                                       Terminology.  The Glossary at the end of this Agreement
contains definitions of all words that appear in this Agreement with an initial
capital letter that are not defined elsewhere in this Agreement.

 

2.                                       Vesting. 
The Option may only be exercised over vested Option Shares and all of
the Option Shares are nonvested as of the Grant Date.  So long as your Service with the Company is
continuous from the Grant Date through the applicable date upon which vesting
occurs, the Option Shares will vest immediately prior to the first to occur of
the following:

 

(a)                                  a
Liquidity Event (provided you are not on a leave of absence from the Company’s
group at this time);

(b)                                 your death; or

(c)                                  the date upon which you suffer a Disability.

 

If you are on
a leave of absence from the Company’s group at the time of the Liquidity Event,
your Option will vest on the day of your return to work.

 

3.                                       Termination of Employment or Service.

 

3.1                                 Unvested Option.  If your Service with the Company ceases for any
reason other than your death or Disability and your Option is unvested, it will
immediately lapse upon such cessation, unless otherwise determined by the
Administrator.

 

3.2                                 Vested Option.  If your Service with the Company ceases for
any reason, and your Option is vested it will not be affected by such cessation
but will remain vested and exercisable and subject to the provisions of this
Agreement.

 

4.                                       Restrictions on Transfer of the Option

 

4.1                                 Your Option may not be assigned, transferred, pledged, hypothecated
or disposed of in any way (whether by operation of law or otherwise) and shall
not be subject to execution, attachment or similar process provided that this
shall not prevent the exercise of your Option by your executors or personal
representatives in the event of your death.

 

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5.                                       Restrictions on Transfer of Option Shares

 

5.1                                 Except as otherwise provided under section 5.3 or 7 of this
Agreement or in accordance with your will or the laws of descent and
distribution upon your death, until a Liquidity Event has occurred any Option
Share acquired on the exercise of the Option may not be assigned, transferred,
pledged, hypothecated or disposed of in any way (whether by operation of law or
otherwise) and shall not be subject to execution, attachment or similar
process.

 

5.2                                 You hereby represent and warrant to the Company as follows:

 

(a)                                  Any Option Shares you acquire on the exercise of your Option you will
hold for your own account for investment only and not with a view to, or for
resale in connection with, any “distribution” of the shares within the meaning
of the Securities Act.

 

(b)                                 You understand that the Option Shares have not been registered under
the Securities Act by reason of a specific exemption and that the Option Shares
must be held indefinitely, unless they are subsequently registered under the
Securities Act or you obtain an opinion of counsel, in form and substance
satisfactory to the Company and its counsel, that such registration is not required.  You further acknowledge and understand that
the Company is under no obligation to register the Option Shares.

 

(c)                                  You will acquire the Option Shares subject to the Company’s By-Laws and
subject to the condition that the Company may, in its discretion, impose
restrictions on the sale, pledge or other transfer of the Option Shares
acquired by you on exercise (including the placement of appropriate legends on
stock certificates) if, in the judgment of the Company, such restrictions are
necessary or desirable to comply with the Securities Act, the securities laws
of any State or any other law.

 

(d)                                 You are aware that any investment in the Company is a speculative
investment that has limited liquidity and is subject to the risk of complete
loss.

 

5.3                                 The
provisions of Sections 5.1 and 5.2(b) shall not apply to the following
transfers; provided, however, that no transfer of Option Shares
pursuant to this Section 5.3 (other than a transfer to the Company) shall
be given effect on the books of the Company unless and until the Permitted
Transferee (as defined below) executes an agreement in writing with the parties
hereto pursuant to which he, she, or it agrees to be bound by all of the terms
and conditions of this Agreement to the same extent as the parties hereto; provided,
further, that no transfer will be permitted if the Company determines
that, in its sole discretion, such transfer is, or is reasonably likely to be,
in violation of applicable federal or state securities laws:

 

(a)                                  a transfer
of vested Option Shares made to an Affiliate of the Company or an Affiliate of
any subsidiary of the Company;

 

(b)                                 a transfer
of vested Option Shares upon your death to your executors, administrators,
testamentary trustees, legatees or beneficiaries;

 

(c)                                  a transfer of
vested Option Shares to a trust, the beneficiaries of which include only you
and your spouse, siblings, or direct lineal ancestors or descendants;

 

(d)                                 a transfer
of vested Option Shares made as a gift to your spouse or lineal descendants; or

 

(e)                                  a transfer
of vested Option Shares made pursuant to a court order in connection with a
divorce proceeding.

 

The transferee in each of
the subclauses (a) through (e) above is referred to herein as a “Permitted Transferee.”  Notwithstanding anything to the contrary in
this Agreement, no transfer made to the Company, any subsidiary of the Company,
or the Sponsor shall be subject to any restriction on transfer contained
herein, so long as any such transfer is made in accordance with all applicable
federal and state securities laws and does not violate any contractual
agreement in effect at the time of such transfer.

 

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5.4                                 The Company shall not be required to (a) transfer on its books
any  Option Shares that have been sold or
transferred in contravention of this Agreement or (b) treat as the owner
of Option Shares, or otherwise accord voting, dividend or liquidation rights
to, any transferee to whom Option Shares have been transferred in contravention
of this Agreement.

 

6.                                       Stock Certificates.  You will be reflected as the owner of record
of the Option Shares as of the date of exercise of the Option on the Company’s
books.  The Company will hold the share
certificates for safekeeping, or otherwise retain the Option Shares in
uncertificated book entry form, until the Option Shares become vested and
nonforfeitable and until they may be transferred freely without restriction
under this Agreement and any share certificates representing such shares will
include a legend in substantially the following form, in addition to any other
legends that may be required under federal or state securities laws.

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE APPLICABLE SECURITIES ACT OF ANY STATE
BUT HAVE BEEN ISSUED IN RELIANCE UPON EXEMPTIONS FROM REGISTRATION CONTAINED IN
SAID ACTS.  NO SALE, OFFER TO SELL OR
OTHER TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY BE MADE UNLESS
A REGISTRATION STATEMENT UNDER SAID ACTS IS IN EFFECT WITH RESPECT TO THE
SECURITIES, OR AN EXEMPTION FROM THE REGISTRATION PROVISIONS OF SUCH ACTS IS
THEN APPLICABLE.

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON TRANSFER AND THE OTHER TERMS AND CONDITIONS SET FORTH IN A
CERTAIN OPTION AGREEMENT DATED JULY 27, 2004, AS AMENDED FROM TIME TO
TIME, BETWEEN THE COMPANY AND THE REGISTERED OWNER OF THIS CERTIFICATE (OR HIS
PREDECESSOR IN INTEREST), AND SUCH AGREEMENT IS AVAILABLE FOR INSPECTION
WITHOUT CHARGE AT THE OFFICE OF THE SECRETARY OF THE COMPANY.

 

All regular cash dividends and other distributions on the Option Shares
held by the Company will be paid directly to you, but any stock dividends will
be treated in the manner set forth in Section 9 of this Agreement.

 

7.                                       Market Stand-Off Agreement.  You agree that following the effective date
of a registration statement of the Company filed under the Securities Act, to
the extent requested by the Company and an underwriter of Common Stock or other
securities of the Company, you will not offer, sell, contract to sell, pledge
or otherwise dispose of, directly or indirectly, any equity securities of the
Company, or any securities convertible into or exchangeable or exercisable for
such securities, enter into a transaction which would have the same effect, or
enter into any swap, hedge or other arrangement that transfers, in whole or in
part, any of the economic consequences of ownership of such securities, whether
any such transaction is to be settled by delivery of such securities or other
securities, in cash or otherwise, or publicly disclose the intention to make
any such offer, sale, pledge or disposition, or to enter into any such
transaction, swap, hedge or other arrangement, in each case during the seven
days prior to and the one hundred and eighty (180) days after the effectiveness
of any underwritten offering of the Company’s equity securities (or such longer
or shorter period as may be requested in writing by the managing underwriter
and agreed to in writing by the Company) (the “Market
Stand-Off Period”), except as part of such underwritten
registration if otherwise permitted.  In
addition, you agree to execute any further letters, agreements and/or other
documents requested by the Company or its underwriters which are consistent
with the terms of this Section 6. 
The Company may impose stop-transfer instructions with respect to
securities subject to the foregoing restrictions until the end of such Market
Stand-Off Period.

 

7.1.                              Tag-Along
and Drag-Along Rights.

 

(a)                                  With respect
to Option Shares which you acquire on the exercise of your Option: If the
Sponsor proposes to transfer all or a portion of the shares of Common Stock
beneficially owned by it to a Third Party which would not be an Affiliate of
the Sponsor immediately upon consummation of such transfer, and the Sponsor
does not exercise its Drag-Along Rights in 

 

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accordance with Section 7.4 (a “Tag-Along
Sale”), the Sponsor shall cause you and your Permitted
Transferees to have the option to exercise your rights under this Section 7.1,
provided, however, that you and your Permitted Transferees, if
any, shall have no rights under this Section 7.1 if the shares of Common
Stock to be transferred in such transaction and any shares of Common Stock
which have been transferred to any Third Party within a 90-day period preceding
the date of such transfer have, in the aggregate, a Fair Market Value less than
ten million dollars ($10,000,000) (a “Small Transfer”),
and provided, further, that when the cumulative Fair Market Value
of all such Small Transfers, the value to be calculated at the time of each
such transfer, exceeds fifty million dollars ($50,000,000), the restrictions
provided for in the first proviso of this Section 7.1(a) shall no longer
be in effect.  Moreover, you and your
Permitted Transferees, if any, shall have no rights under this Section 7.1
with respect to any transfer by the Sponsor of any shares of Common Stock
beneficially owned by it to any limited partner of the Sponsor.

 

(b)                                 In the event
of a proposed Tag-Along Sale:

 

(i)                                     the Sponsor
shall provide you written notice of the terms and conditions of such proposed
Tag-Along Sale, as described in Section 7.1(c) (“Tag-Along
Notice”), at least 10 Business Days prior to the consummation of
such proposed Tag-Along Sale and offer you and your Permitted Transferees the
opportunity to participate in such Tag-Along Sale on the terms and conditions
set forth in this Section 7.1; and

 

(ii)                                  subject to Section 7.1(c),
you and your Permitted Transferees shall be entitled to sell up to a Pro Rata
Portion (as defined below) of your Option Shares (the “Tag
Shares”) at the same price and on the same terms as the shares
of Common Stock proposed to be sold by the Sponsor in such Tag-Along Sale in
accordance with the terms set forth in this Section 7.1.

 

The “Pro-Rata Portion” of your Tag Shares
shall mean an amount of such Tag Shares equal to the product of:

 

(A)                              (x) a
fraction, the numerator of which is the number of shares of Common Stock
proposed to be transferred by the Sponsor and its Affiliates in such Tag-Along
Sale and the denominator of which is the total number of shares of Common Stock
beneficially owned by the Sponsor and its Affiliates collectively, immediately
prior to transferring such shares of Common Stock; or, (y) for the first
transfer after the restrictions set forth in the first proviso of Section 7.1(a)
are no longer in effect, a fraction, the numerator of which is the number of
shares of Common Stock proposed to be transferred by the Sponsor and its
Affiliates in such Tag-Along Sale plus the cumulative number of shares of
Common Stock transferred by the Sponsor and its Affiliates in all Small
Transfers, and the denominator of which is the total number of shares of Common
Stock beneficially owned by the Sponsor and its Affiliates collectively,
immediately prior to transferring such shares of Common Stock plus the
cumulative number of shares of Common Stock transferred by the Sponsor and its
Affiliates in all Small Transfers; and

 

(B)                                the total
amount of Tag Shares beneficially owned by such Executive at the time of the
Tag-Along Sale.

 

(c)                                  The
Tag-Along Notice shall identify the proposed transferee, the number of shares
of Common Stock to be sold by the Sponsor in the Tag-Along Sale, the Pro Rata
Portion of your Tag Shares which you shall be entitled to transfer in such
Tag-Along Sale, the price at which the transfer of shares of Common Stock is
proposed to be made, and all other material terms and conditions of the
proposed Tag-Along Sale.  From the date
of the Tag-Along Notice, you and your Permitted Transferees shall have the
right (a “Tag-Along Right”),
exercisable by written notice (“Tag-Along Response Notice”)
given by you to the Sponsor within seven Business Days from the date of the
Tag-Along Notice (the “Tag-Along Response Notice
Period”), to request that the Sponsor includes in the proposed
transfer the number of Tag Shares held by you and your Permitted Transferees
(up to their Pro Rata Portion) as is specified in such Tag-Along Response
Notice at the same price and on the same terms and conditions set forth in the
Tag Along Notice; 

 

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provided, however, that if the
aggregate number of shares of Common Stock proposed to be sold by (i) the
Sponsor, (ii) you and your Permitted Transferees, (iii) Other Option Grantees
and their permitted transferees giving tag-along notices similar to the
Tag-Along Notice during such period prescribed in other Option Grantees’
Agreements and (iv) any other persons entitled to give (and giving on a timely
basis) tag-along notices similar to the Tag-Along Notice pursuant to agreements
substantially similar to this Agreement, including those certain Option
Transfer Agreements, those certain Amended and Restated Management Subscription
Agreements, those certain Retained Share Agreements, and those certain
Restricted Stock Agreements, each between the Company, the Sponsor and you or
Other Key People, as amended, (the persons identified in subclauses (i), (ii),
(iii) and (iv) of this subsection, collectively, the “Participants”),
in such Tag-Along Sale exceeds the number of shares of Common Stock which can
be sold on the terms and conditions set forth in the Tag-Along Notice, then
only the Tag-Along Portion of shares of Common Stock beneficially owned by you
shall be sold pursuant to the Tag-Along Sale. 
“Tag-Along Portion” means,
with respect to you and your Permitted Transferees, the number of shares of
Common Stock beneficially owned by you and your Permitted Transferees on the
date of the Tag-Along Notice multiplied by a fraction, the numerator of which
is the maximum number of shares of Common Stock which can be sold in the
Tag-Along Sale and the denominator of which is the aggregate number of shares
of Common Stock beneficially owned by the Participants, collectively.

 

(d)                                 Delivery of
a Tag-Along Response Notice by you to the Sponsor pursuant to Section 7.1(c)
shall constitute an irrevocable election by you and your Permitted Transferees,
if any, to sell the number of Tag Shares beneficially owned by it or them as is
specified in such Tag-Along Response Notice in such Tag-Along Sale.  If, at the end of a 90-day period after such
delivery, the Tag-Along Sale has not been consummated on substantially the same
terms and conditions set forth in the Tag-Along Notice, all restrictions on
transfers of Tag Shares contained in this Agreement or otherwise applicable at
such time with respect to Tag Shares owned by you and your Permitted
Transferees shall again be in effect.

 

(e)                                  If at the
termination of the Tag-Along Response Notice Period you and your Permitted
Transferees, if any, shall not have exercised its or their Tag-Along Right by
providing the Sponsor with a Tag-Along Response Notice, such Executive and such
Executive’s Permitted Transferees shall be deemed to have waived its or their
Tag-Along Right with respect to transferring its or their Tag Shares pursuant
to such Tag-Along Sale.

 

(f)                                    The Sponsor
may sell, on behalf of you and your Permitted Transferees, if you and your
Permitted Transferees, if any, exercise your or their Tag-Along Right pursuant
to this Section 5.1, the shares of Common Stock entitled to be transferred
in the Tag-Along Sale on the terms and conditions set forth in the Tag-Along
Notice within 90 days of the date on which Tag-Along Rights shall have been
waived or exercised.

 

7.2.                              Limitation
of Rights Following Termination of Employment.  Notwithstanding any other provision of this
Agreement, upon the termination of your employment with the Company or any of
its subsidiaries for Cause, or if you terminate your employment with the
Company or any of its subsidiaries without Good Reason (as such term is defined
in your employment agreement with the Company, if any), you and your Permitted
Transferees shall have no rights under Section 7.1.  In the case of any other termination of your
employment, you and your Permitted Transferees shall continue to have the
rights specified in Section 7.1.

 

7.3.                              Termination
of Tag-Along Rights. 
Notwithstanding anything to the contrary, the provisions of Section 7.1
shall not be applicable if the Common Stock is publicly traded on an Exchange
and there exists a Minimum Public Float.

 

7.4.                              Drag-Along
Rights.  With respect to
Option Shares which you acquire on the exercise of your Option:  (a)  If
the Sponsor and its Affiliates propose to transfer all or any portion of the
shares of Common Stock beneficially owned by them to a Third Party (a “Drag-Along Sale”), you and your
Permitted Transferees shall, at the Sponsor’s option and in the Sponsor’s sole
discretion, upon your receipt of written notice from the Sponsor, sell the
Drag-Along Portion of your Option Shares to such Third Party for the same
consideration and otherwise on the same terms and conditions on which the
Sponsor and its Affiliates sell their shares of Common Stock in such Drag-Along
Sale (the “Drag-Along Rights”).

 

The “Drag-Along Portion” of your Option
Shares means, at any time, the number of Option Shares beneficially owned by
you and your Permitted Transferees, multiplied by a fraction, the 

 

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numerator of
which is the number of shares of Common Stock proposed to be sold on behalf of
the Sponsor in such Drag-Along Sale and the denominator of which is the total
number of shares of Common Stock then beneficially owned by the Sponsor.

 

(b)                                 The Sponsor
shall provide written notice of such Drag-Along Sale to you (a “Drag-Along Notice”) not less than 20
days prior to the consummation of such proposed Drag-Along Sale which notice
shall state that the Sponsor proposes to effect a transfer of a certain number
of shares of Common Stock, the number of shares of Common Stock proposed to be
transferred, the purchase price, the proposed transferee, the number of Option
Shares which you are required to transfer in such Drag-Along Sale (based on the
methodology set forth in Section 7.4(a)), and all other material terms and
conditions of the Drag-Along Sale. 
Subject to Section 7.4(c), you shall be required to participate in
the Drag-Along Sale on the terms and conditions set forth in the Drag-Along
Notice.  Not later than the tenth day
following the date of the Drag-Along Notice (the “Drag-Along
Notice Period”), you shall deliver to a representative of the
Sponsor designated in the Drag-Along Notice certificates representing all the
Option Shares beneficially owned and held by you, duly endorsed, together with
all other documents required to be executed in connection with such Drag-Along Sale,
or, if such delivery is not permitted by applicable law, an unconditional
agreement to deliver such Option Shares pursuant to this Section 7.4 at
the closing for such Drag-Along Sale against delivery to you of the
consideration therefor.  If you should
fail to deliver such certificates to the Sponsor in a Drag-Along Sale pursuant
to this Section 7.4, the Company shall cause the books and records of the
Company to show that such shares of Common Stock are bound by the provisions of
this Section 7.4 and that such shares of Common Stock shall be transferred
to the purchaser of the shares of the Common Stock immediately upon surrender
for transfer by the holder thereof.

 

(c)                                  The Sponsor shall have a period of 90 days from the
date of the Drag-Along Notice to consummate the Drag-Along Sale on the terms
and conditions set forth in such Drag-Along Sale Notice.  If the Drag-Along Sale shall not have been
consummated during such period, the Sponsor shall return to you all certificates
representing Option Shares that you delivered for transfer pursuant hereto,
together with any documents in the possession of the Sponsor executed by you in
connection with such proposed transfer, and the Drag-Along
Notice shall be deemed to be cancelled and this Agreement will remain in full
force and effect in accordance with its terms.

 

7.5.                              Other
Responsibilities. 
The delivery of any notices to, and the obtaining of any consents from,
any Permitted Transferee with respect to any provision of this Agreement,
including, but not limited to, Sections 7.1 and 7.4, shall be your sole
responsibility, unless otherwise agreed to in writing between such Permitted
Transferee and the Sponsor.  Neither the
Company nor the Sponsor shall be liable to any Permitted Transferee for your
failure to deliver a notice to, or obtain a consent from, any Permitted
Transferee with respect to any provision of this Agreement, including, but not
limited to, Sections 7.1 and 7.4.

 

7.6.                              Sales to
Principal Beneficial Owners. 
The Sponsor and its Affiliates shall not transfer all or any portion of
the shares of Common Stock beneficially owned by them to a Principal Beneficial
Owner, other than an Affiliate of the Sponsor, unless such Principal Beneficial
Owner agrees to be bound by this Section 7 as if it were the Sponsor.  To the extent that the Sponsor and its
Affiliates transfer any shares of Common Stock to a Principal Beneficial Owner
other than an Affiliate of the Sponsor, you and your Permitted Transferees
agree that such Principal Beneficial Owner shall receive the benefits set forth
in Sections 7.4 and 7.5 hereof as if such Principal Beneficial Owner were the
Sponsor.

 

8.                                       Tax Withholding

 

8.1 Tax Withholding.  The
Company shall have the right to deduct from any compensation or any other
payment of any kind (including, upon approval of the Board of Directors of the
Company, withholding the delivery of shares of Common Stock) due you the amount
of any federal, state, local or foreign taxes required by law to be withheld
which arise in connection with the Option Shares; provided, however,
that the value of the shares of Common Stock withheld may not exceed the
statutory minimum withholding amount required by law.  In lieu of such deduction and as a condition
of the exercise of the Option, the Company may require you to make a cash
payment to the Company equal to the amount required to be withheld or may sell
a sufficient number of Option Shares on your behalf to realize an amount as
nearly as possible equal to the withholding liability or require your agreement
to such other arrangements it deems 

 

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necessary or
desirable for the recovery of any taxes, duties or social security payments
paid on your behalf.  If you do not make
such payment when requested, the Company may refuse to issue any Common Stock
certificate under this Agreement until arrangements satisfactory to the
Administrator for such payment have been made.

 

9.                                       Adjustments for Corporate Transactions and Other Events.

 

9.1                                 Stock Dividend, Stock Split and Reverse
Stock Split.  Upon a stock
dividend of, or stock split, reverse stock split, or similar event affecting,
the Common Stock, the number of such Option Shares subject to your Option,
without further action of the Administrator, shall be adjusted to reflect such
event.  The Administrator may make
adjustments, in its discretion, to address the treatment of fractional shares
with respect to the Option Shares as a result of the stock dividend, stock
split, reverse stock split, or similar event. 
Adjustments under this Section 9 will be made by the Administrator,
whose determination as to what adjustments, if any, will be made and the extent
thereof will be final, binding and conclusive. 
No fractional Option Shares will result from any such adjustments.

 

9.2                                 Binding Nature of Agreement. 
The terms and conditions of this Agreement shall apply with equal force
to any additional and/or substitute securities received by you in exchange for,
or by virtue of your Option, whether as a result of any spin-off, stock split-up,
stock dividend, stock distribution, other reclassification of the Common Stock
of the Company, or similar event, except as otherwise determined by the
Administrator.  If the Option Shares are
converted into or exchanged for, or stockholders of the Company receive by
reason of any distribution in total or partial liquidation or pursuant to any
merger of the Company or acquisition of its assets, securities of another
entity, or other property (including cash), then the rights of the Company
under this Agreement shall inure to the benefit of the Company’s successor, and
this Agreement shall apply to the securities or other property received upon
such conversion, exchange or distribution in the same manner and to the same
extent as the Option Shares.

 

10.                                 Non-Guarantee of Employment or Service Relationship.  Nothing in the Plan or this
Agreement shall alter your at-will or other employment status or other service
relationship with the Company, nor be construed as a contract of employment or
service relationship between the Company and you, or as a contractual right of
you to continue in the employ of, or in a service relationship with, the
Company for any period of time, or as a limitation of the right of the Company
to discharge you at any time with or without cause or notice and whether or not
such discharge results in the forfeiture of any Option Shares or any other
adverse effect on your interests under the Plan.

 

11.                                 The Company’s Rights.  Except as provided under this Agreement, the
existence of the Options shall not affect in any way the right or power of the
Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company’s capital
structure or its business, or any merger or consolidation of the Company, or
any issue of bonds, debentures, preferred or other stocks with preference ahead
of or convertible into, or otherwise affecting the Common Stock or the rights
thereof, or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of the Company’s assets or business, or any other
corporate act or proceeding, whether of a similar character or otherwise.

 

12.                                 Notices. 
All notices and other communications made or given pursuant to this
Agreement shall be in writing and shall be sufficiently made or given if hand
delivered or mailed by certified mail, addressed to you at the address
contained in the records of the Company, or addressed to the Administrator,
care of the Company for the attention of its Corporate Secretary at its
principal executive office or, if the receiving party consents in advance,
transmitted and received via telecopy or via such other electronic transmission
mechanism as may be available to the parties.

 

13.                                 Entire Agreement.  This Agreement contains the entire agreement
between the parties with respect to the Award Shares granted hereunder.  Any oral or written agreements,
representations, warranties, written inducements, or other communications made
prior to the execution of this Agreement with respect to the Option Shares
granted hereunder shall be void and ineffective for all purposes.

 

14.                                 Amendment.  This Agreement may be amended from time to
time only be a written instrument duly executed by the Company, the Sponsor,
and you.

 

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15.                                 Conformity with Plan.  This Agreement is intended to conform in all
respects with, and is subject to all applicable provisions of, the Plan.  Inconsistencies between this Agreement and
the Plan shall be resolved in accordance with the terms of the Plan.  In the event of any ambiguity in this
Agreement or any matters as to which this Agreement is silent, the Plan shall
govern.  A copy of the Plan is available upon request.  Please contact the Company by email at
dselby@vertisinc.com or at 250 W. Pratt Street, 18th Floor,
Baltimore, Maryland 21201, Attention: Dolores D. Selby, (telephone:
410-361-8394), to receive a copy of the Plan.

 

16.                                 Governing Law. The validity,
construction and effect of this Agreement, and of any determinations or
decisions made by the Administrator relating to this Agreement, and the rights
of any and all persons having or claiming to have any interest under this
Agreement, shall be determined exclusively in accordance with the laws of the
State of Delaware, without regard to its provisions concerning the
applicability of laws of other jurisdictions. 
Any suit with respect hereto will be brought in the federal or state
courts in the districts which include New York, New York, and you hereby agree
and submit to the personal jurisdiction and venue thereof.

 

17.                                 Headings.  The headings in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.

 

18.                                 Notices. 
All notices and other communications provided for herein shall be dated
and in writing and shall be deemed to have been duly given when delivered, if
delivered personally or sent by registered or certified mail, return receipt
requested, postage prepaid and when received if delivered otherwise, to the
party to whom it is directed:

 

(a)                        If to the Company, to it at the following address:

 

250 W. Pratt Street, 18th Floor

Baltimore, Maryland 21201

Attention: 
General Counsel

Fax No.:  (410)
528-9287

 

with a copy to the Sponsor, at the address set forth below:

 

(b)                       If to you, at the address set forth in the Company’s records;

 

(c)                        If to the Sponsor, to it at the following address:

 

Thomas H. Lee Equity Fund IV, L.P.

c/o Thomas H. Lee Company

75 State Street, Suite 2600

Boston, MA 02109

Attention: Anthony J. DiNovi

Fax No.: (617) 227-3514

 

or at such other address as the parties hereto shall have specified by
notice in writing to the other parties (provided, that such notice of
change of address shall be deemed to have been duly given only when actually
received).

 

19.                                 Limitation of Liability. 
None of the Affiliates of the Sponsor shall have any liability to the
you or any of your Permitted Transferees or the Company or any of its
subsidiaries under any provision of this Agreement.  In the event of an alleged breach of this
Agreement by the Sponsor, the parties hereto acknowledge and agree that the
sole remedy which may be sought against the Sponsor shall be specific
performance, provided, however, that if the remedy of specific performance
is not available, you, your Permitted Transferees, if any, and the Company will
only seek to recover direct damages for any breach of this Agreement.  You, your Permitted Transferees, if any, and
the Company agree to waive any other remedy against the Sponsor to which they
might be entitled at law, including, but not limited to, compensatory damages,
consequential damages, continuing damages, future damages, incidental damages,
punitive damages and nominal damages. 
The Company shall indemnify, defend, save and hold harmless Sponsor from
and against any and all liabilities arising under, pursuant to or in connection
with this Agreement.

 

8

 

20.                                 Severability.  The invalidity, illegality or unenforceability
of one or more of the provisions of this Agreement in any jurisdiction shall
not affect the validity, legality or enforceability of the remainder of this
Agreement in such jurisdiction or the validity, legality or enforceability of
this Agreement, including any such provision, in any other jurisdiction, it
being intended that all rights and obligations of the parties hereunder shall
be enforceable to the fullest extent permitted by law.

 

21.                                 Counterparts.  This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which shall constitute
one and the same instrument, and it shall not be necessary in making proof of
this Agreement to produce or account for more than one such counterpart.

 

9

 

GLOSSARY

 

(a)                                  “Administrator” means the
Committee as determined under Section 2.7 of the Plan.

 

(b)                                 “Affiliate” has the meaning
given to such term in the Plan.

 

(c)                                  “Business Day” means any day
other than a Saturday, Sunday, or other day during which the Company’s
principal executive office is not open for business.

 

(d)                                 “Cause” generally means your
insubordination, dishonesty, incompetence, moral turpitude, other misconduct of
any kind or the refusal to perform your duties or responsibilities for any
reason other than illness or incapacity, in each case as determined by the
Board in good faith.  However, if you
have an employment agreement, consulting agreement, change of control agreement
or similar agreement in effect with the Company at the time in question that
defines “cause” (or words of like import), then “cause” has the meaning
ascribed to it under such agreement, as such agreement shall provide at the
time in question; provided that with respect to any agreement that conditions “cause”
on the occurrence of a change of control, such definition of “cause” shall not
apply until a change of control actually takes place and then only with regard
to a termination thereafter.

 

(e)                                  “Common Stock” means the
common stock, $.01 par value, of Vertis Holdings, Inc..

 

(f)                                    “Company” means Vertis
Holdings, Inc. and its Affiliates, except where the context otherwise
requires.  For purposes of determining
whether a Liquidity Event has occurred, Company shall mean only Vertis
Holdings, Inc.

 

(g)                                 “Disability”
means your inability to perform substantially your duties and responsibilities
to the Company by reason of a physical or mental disability or infirmity for a
continuous period of three months.  The
date of such disability shall be the earlier of (1) the last day of such
three-month period or (2) the day on which you submit, or cause to be
submitted, to the Board any medical evidence of such disability reasonably
satisfactory to the Board.

 

(h)                                 “Exchange”
means the principal stock exchange, including The Nasdaq Stock Market, on which
the Common Stock is listed or approved for listing, if any.

 

(i)                                     “Liquidity Event” means (1) a
public offering of the Common Stock registered pursuant to the Securities Act
where there is a Minimum Public Float immediately following such offering, (2)
a merger or other business combination or recapitalization whereby the Common
Stock is exchanged for cash and/or publicly traded equity or debt securities in
another entity or a combination of cash and other non-publicly traded equity or
debt securities where cash constitutes at least a majority of the consideration
to be received in such merger, business combination or recapitalization or (3)
a sale or other disposition of all or substantially all of the Company’s assets
to another entity, for cash and/or publicly traded equity or debt securities of
another entity or a combination of cash and other non-publicly traded equity or
debt securities where cash constitutes at least a majority of the proceeds of
such sale or disposition, in each case, other than to the Company, any
subsidiary of the Company, or any entity controlled by the ultimate control
persons of the Company.

 

(j)                                     “Minimum Public Float” means
the circumstances existing when (i) the consummation of one or more public
offerings registered pursuant to the Securities Act of shares of Common Stock
if, upon such consummation, the aggregate number of shares of Common Stock held
by the public, not including Affiliates of the Company, represents at least 20%
of the total number of outstanding shares of Common Stock at the time of such
public offering and (ii) the Common Stock is listed on an Exchange.

 

(k)                                  “Other Option Share Grantees”
means other persons receiving Options pursuant to an agreement having terms
substantially identical to those contained in this Agreement.

 

(l)                                     “Other Key People” means the
officers, members of management, key employees of the Company and its
Affiliates.

 

10

 

(m)                               “Principal Beneficial Owner”
means any of the Sponsor, CLI/THLEF IV Vertis LLC, Evercore Capital Partners
L.P., CLI Associates LLC, J.P. Morgan Partners (BHCA), L.P., Wachovia Capital
Partners, LLC (formerly First Union Capital Partners, LLC), and Cadogan
Capital, LLC and their respective Affiliates and successors.

 

(n)                                 “Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder.

 

(o)                                 “Service” means your
employment or other service relationship with the Company and its Affiliates.  Service will be considered to have ceased
with the Company if, after a sale, merger or other corporate transaction, the
trade, business or entity with which you are employed is no longer an Affiliate
of Vertis Holdings, Inc.

 

(p)                                 “Third Party” means any person
or entity excluding each of the following: 
(a) the Company and its employees, officers, directors and (b) the
Principal Beneficial Owners.

 

(q)                                 “You”; “Your”.  You means the recipient of the Option Shares
as reflected in the first paragraph of this Agreement.  Whenever the word “you” or “your” is used in
any provision of this Agreement under circumstances where the provision should
logically be construed, as determined by the Administrator, to apply to the
estate, personal representative, or beneficiary to whom the Option Shares may
be transferred by will or by the laws of descent and distribution, the words “you”
and “your” shall be deemed to include such person.

 

11

 

IN WITNESS WHEREOF, the Company and the Sponsor have caused this
Agreement to be executed by their duly authorized officers.

 

 

	
   

  	
  VERTIS
  HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ John V. Howard

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THOMAS
  H. LEE EQUITY FUND IV, L.P.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ Anthony DiNovi

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
					

 

 

The undersigned hereby acknowledges that he/she has carefully read this
Agreement and agrees to be bound by all of the provisions set forth herein.

 

	
  WITNESS:

  	
  GRANTEE

  
	
   

  	
   

  
	
   

  	
   

  
	
  [Witness]

  	
   

  	
  /S/
  Adriaan Roosen

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  
	
  Enclosure:
  Vertis Holdings, Inc. 1999 Equity Award Plan

  	
   

  
						

 

12EXHIBIT 10.45

Vertis Holdings, Inc.

2004 Restricted Stock Term Sheet

 

April 5, 2004

 

 

	
  Goal:

  	
  Provide an equity
  incentive for 2004 performance to certain key employees of Vertis Holdings,
  Inc. (the “Company”).

  
	
   

  	
   

  
	
  Participant:

  	
  Adriaan Roosen (the
  “Participant”).

  
	
   

  	
   

  
	
  Award:

  	
  3,750 shares of the
  Company’s restricted common stock (the “Award Shares”) that will be granted
  upon the achievement of certain performance thresholds.

  
	
   

  	
   

  
	
  Thresholds:

  	
  1,875 of the Award
  Shares will be granted to the Participant if the Company’s board of directors
  determines that the Company’s EBITDA from its European operations for the
  year ended December 31, 2004 (“European EBITDA”) is at least $12.3
  million.   An additional 1,875 of the
  Award Shares will be granted if European EBITDA is at least $14.0
  million.  For European EBITDA of
  between $12.3 million and $14.0 million, the grant will be proportionately
  adjusted such that the total number of Award Shares granted equals 1,875 plus
  (1,875 multiplied by European EBITDA in excess of $12.3 million (up to $1.7
  million) and divided by $1.7 million). 
  In addition, the Company expects that the Award Shares will be granted
  in the form of a nil cost option rather than actual shares of the Company’s
  common stock and the terms of the Award Shares described below will be
  adjusted accordingly.

  
	
   

  	
   

  
	
  Timing:

  	
  The Award Shares will
  be granted as soon as reasonably practicable following the Company’s
  determination as to whether (and to what extent) the Participant has exceeded
  the 2004 thresholds described above.

  
	
   

  	
   

  
	
  Restricted Stock:

  	
  Upon issuance, the
  Award Shares will still constitute “restricted” shares of the Company’s
  common stock.  The shares are
  restricted because they are subject to forfeiture and restrictions on
  transfer until the shares “vest.”  Once
  shares of restricted stock have vested, those shares will no longer be
  subject to forfeiture.

  
	
   

  	
   

  
	
  Vesting:

  	
  The shares of
  restricted stock will vest (assuming your continued employment) immediately
  prior to the first to occur of a “liquidity event,” your death or the date on
  which you suffer a “disability.”  Prior
  to vesting, your unvested restricted stock will be forfeited completely if
  you leave the employ of the Company (or its subsidiaries) for any or no
  reason (other than your death or disability), including voluntary resignation
  or termination of your employment with or without cause.  Because the vesting of the restricted stock
  depends on the occurrence of a future event which may or may not occur, the
  Company cannot assure you that the restricted stock will ever become vested.

  
	
   

  	
   

  
	
  Transfers:

  	
  Because the Company is
  privately owned, the restricted stock will continue to be subject to
  restrictions on transfer, even after it vests.

  
	
   

  	
   

  
	
  Documentation:

  	
  The Award Shares
  described in this term sheet will only be issued upon the full execution of a
  restricted stock agreement substantially in the form attached hereto as Exhibit
  A (the “Restricted Stock Agreement”). 
  This term sheet is qualified in its entirety by reference to the
  detailed terms and conditions included in the Restricted Stock
  Agreement.  You should carefully review
  the Restricted Stock Agreement.

  
	
   

  	
   

  
	
  Confidentiality:

  	
  The Award Shares are
  being made available only to the Participant and to a limited number of other
  key employees of the Company.  In order
  to receive any Award Shares, the Participant must maintain the
  confidentiality of this term sheet, the Award Shares and the thresholds
  described above.  Any disclosure in
  violation of this provision may result in the forfeiture of any Award Shares
  to which the Participant may become entitled.

  

 

 

 

	
   

  	
   

  
	
  Questions:  

  	
  Any questions regarding
  this transaction should be sent by e-mail to
  restrictedshare2004@vertisinc.com.

  

 

THIS TERM SHEET IS FOR
INFORMATIONAL PURPOSES ONLY.  THE
CONTENTS OF THIS TERM SHEET ARE NOT TO BE CONSTRUED AS LEGAL, BUSINESS OR TAX
ADVICE.  EACH PARTICIPANT SHOULD CONSULT
THE PARTICIPANT’S OWN ATTORNEY, BUSINESS ADVISOR AND TAX ADVISOR AS TO LEGAL,
BUSINESS AND TAX ADVICE.

 

 

2

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