Document:

Exhibit 10.7

 

TOPS HOLDING CORPORATION

2007 STOCK INCENTIVE PLAN

NON-QUALIFIED STOCK OPTION AGREEMENT

TIME VESTING

GRANT

 

This Option Agreement
evidences the grant by Tops Holding Corporation (the “Company”), in
accordance with the Tops Holding Corporation 2007 Stock Incentive Plan (the “Plan”),
of a Non-Qualified Stock Option (the “Option”) to [          ]
(“Eligible Employee”) to purchase from the Company [        ]
shares of common stock, par value $0.001 per share, of the Company (the “Stock”)
at an Option Price per share equal to $[        ].  This Option is granted effective as of [          ]
(the “Grant Date”).

 

 

	
   

  	
  TOPS
  HOLDING CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

 

TERMS
AND CONDITIONS

 

Section 1.                                           Plan.  This Option is subject to all of the terms
and conditions set forth in the Plan and this Option Agreement, and all
capitalized terms not otherwise defined in this Option Agreement shall have the
respective meaning of such terms as defined in the Plan.  If a determination is made that any term or
condition set forth in this Option Agreement is inconsistent with the Plan, the
Plan shall control.  A copy of the Plan
is attached hereto as Exhibit A.

 

Section 2.                                           Exercise Rights.

 

(a)                                 General Rule.  Subject to accelerated vesting pursuant to
the terms hereof or Section 12.1 of the Plan, Eligible Employee
automatically shall have the right under this Option Agreement to exercise this
Option in accordance with the following schedule, if Eligible Employee remains
continuously employed by the Company or an Affiliate or a Subsidiary (“Employer”)
from the Grant Date through the vesting date set forth in the schedule below:

 

	
  Vesting Date

  	
   

  	
  Total Shares for Which

  Options are First Exercisable

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

Eligible
Employee shall not have the right to exercise this Option with respect to any
fractional share of Stock.  If this
schedule would otherwise permit the Eligible Employee to exercise this Option
with respect to a fractional share of Stock on any vesting date, the number of
shares of Stock that shall become exercisable on such vesting date shall be
rounded down to the next lowest whole number of shares of Stock.  Subject to Section 2(b) and Section 3,
on the last vesting date listed above, the Eligible Employee shall have the
right to exercise this Option with respect to all previously unexercisable
shares of Stock.

 

(b)                                Special Rules.

 

(1)                                  Termination
Without Cause; Resignation. Subject to Section 3,
if Eligible Employee’s employment is terminated (other than as described in Section 2(b)(2) or
2(b)(3) below) or if Eligible Employee resigns for any reason, this
Option, to the extent then vested and exercisable, must be exercised within
thirty (30) days of such termination or resignation, as applicable.  At the end of such thirty (30) day period the
Option shall expire and be forfeited to the extent then un-exercised.  The unvested remainder of this Option shall
expire and be immediately and automatically forfeited upon such termination or
resignation, as applicable.

 

2

 

(2)                                 Termination for
Cause.  If Eligible Employee’s
employment is terminated for Cause, this Option shall expire and be immediately
and automatically forfeited at the time of such Eligible Employee’s
termination.  In addition, if after
Eligible Employee’s termination of employment under Section 2(b)(1) or
2(b)(3) the Board of Directors of the Company (the “Board”) becomes
aware of facts that, if they had been aware of at the time of termination,
could have permitted the Board to terminate Eligible Employee’s employment for
Cause, then this Option shall expire and be immediately and automatically
forfeited at the time of such determination of Cause by the Board.

 

(3)                                 Death or
Disability.  Subject to Section 3,
if Eligible Employee’s employment terminates due to “Disability” (as defined in
Section 2(c)) or death, this Option to the extent then vested and
exercisable, must be exercised at any time within six (6) months of such
death or Disability.  At the end of such
6-month period the Option shall expire and be automatically forfeited to the
extent then un-exercised.  The unvested
remainder of this Option shall expire and be immediately and automatically
forfeited upon such death or Disability.

 

(c)                                 Definitions.

 

(1)                                 Cause.  For purposes
of this Option Agreement, “Cause” means (i) the willful failure by
the Eligible Employee to perform such duties as are reasonably requested by the
Board or the Company’s Chief Executive Officer, as determined in good faith by
the Board, and such failure shall have continued for a period of ten (10) days
after the Company gives written notice to Eligible Employee specifying such
failure, (ii) the failure by the Eligible Employee to observe material
Company policies generally applicable to employees of the Company, (iii) gross
negligence or willful misconduct by the Eligible Employee in the performance of
his duties, as determined in good faith by the Board, (iv) the commission
by the Eligible Employee of any act of fraud (including, without limitation,
any material misrepresentation made by Eligible Employee to the Company or any
of its predecessors or affiliates, including, without limitation, Morgan
Stanley, and their respective agents, in connection with such party’s
evaluation of Eligible Employee as a prospective employee), theft or financial
dishonesty with respect to the Company or any of its affiliates, (v) the
Eligible Employee’s indictment, conviction of, or pleading no contest or nolo
contendere to, any felony or a lesser crime involving dishonesty or moral
turpitude, (vi) breach of any material provision of any employment
agreement between Eligible Employee and the Company, (vii) failure of the
Eligible Employee to obtain or retain 

 

3

 

any permits, licenses or approvals which may be required by any state
or local authorities in order to permit the Eligible Employee to continue
employment in the ordinary course, (viii) any act or omission that is
materially injurious (financially or otherwise) to the Company or its
reputation, (ix) chronic absenteeism or (x) alcohol or other
substance abuse by the Eligible Employee. 
The Board shall determine whether Cause for termination exists.  Notwithstanding the foregoing, in the event
the Eligible Employee has an employment agreement with the Company that
provides for termination for “cause” or “reasonable cause”, the definition of
cause or reasonable cause, as applicable, contained in such employment
agreement shall govern this Option Agreement.

 

(2)                                 Disability.  For purposes
of this Option Agreement, “Disability” has the same definition as under
the then-existing disability insurance plan covering Eligible Employee.  The Board shall determine whether Eligible
Employee has a Disability.  Notwithstanding
the foregoing, in the event the Eligible Employee has an employment agreement
with the Company that provides for termination for “disability”, the definition
of “disability” contained in such employment agreement shall govern this Option
Agreement.

 

(d)                                Other
Conditions.  At the
discretion of the Committee, the grant of this Option may be conditioned on
Eligible Employee’s execution of a non-disclosure agreement, a non-solicitation
agreement, a non-disparagement agreement and/or a noncompete agreement in the
form(s) presented to Eligible Employee. 
If the grant of this Option is conditioned on such agreement(s) and
any such agreement is not executed on or prior to the date the Eligible
Employee executes this Option (or such later date as may be provided by the
Committee), this Option shall automatically expire at such time as is
determined by the Committee in its sole discretion.

 

Section 3.                                           Life of Option.  This Option shall expire and shall not be
exercisable for any reason on or after the tenth anniversary of the Grant Date.

 

Section 4.                                           Method of
Exercise of Option.  Eligible
Employee may exercise this Option in whole or in part (to the extent this
Option is otherwise exercisable under Section 2) on any normal business
day of the Company by (a) delivering a copy of this Option Agreement to
the Company, together with written notice of the exercise of the Option, (b) simultaneously
paying to the Company the Option Price for the number of Options being
exercised and (c) making such statements as the Company may reasonably
require under Section 9 or entering into the Shareholders’ Agreement (as
defined herein) as the Company may reasonably require under Section 11.  The payment of such Option Price shall be
made either in cash or by check.  The
Company may suspend the Eligible Employee’s exercise of this Option pending a
determination by the Board regarding whether Cause for termination of Eligible
Employee’s employment 

 

4

 

exists. 
If the Board determines that Cause exists, the notice of exercise shall
be rescinded and the Eligible Employee’s Option Price returned to him.

 

Section 5.                                           Delivery.  The Company shall deliver a properly issued
certificate for any Stock purchased pursuant to the exercise of this Option as
soon as practicable after such exercise (or otherwise register such Stock in
the name of Eligible Employee), and such delivery (or registration in the name
of Eligible Employee) shall discharge the Company of all of its duties and
responsibilities with respect to this Option to the extent so exercised.

 

Section 6.                                           Nontransferable;
Notice.  Except as expressly authorized
in writing by the Board, no rights granted under this Option shall be
transferable by Eligible Employee other than by will or by the laws of descent
and distribution, and the rights granted under this Option shall be exercisable
during Eligible Employee’s lifetime only by Eligible Employee or his legal
representative in the event of his incapacity. 
The Person or Persons, if any, to whom this Option is transferred by
will or by the laws of descent and distribution or through a written Board
authorization shall be treated after such transfer the same as Eligible
Employee under this Option Agreement. 
Eligible Employee shall promptly notify the Company of any change in the
holder of this Option or any change in Eligible Employee’s address or permanent
place of residence.

 

Section 7.                                           No Right to
Continue Service.  Neither the
Plan, this Option, nor any related material shall give Eligible Employee the
right to continue in employment by Employer or any other Subsidiary or
Affiliate or shall adversely affect the right of Employer or any Subsidiary or
Affiliate to terminate Eligible Employee’s employment with or without Cause at
any time.

 

Section 8.                                           Stockholder
Status.  Eligible Employee shall have
no rights as a stockholder with respect to any shares of Stock under this
Option until such shares have been duly issued to (or registered in the name
of) Eligible Employee and, except as expressly set forth in the Plan, no
adjustment shall be made for dividends of any kind or description whatsoever or
for distributions of other rights of any kind or description whatsoever
respecting such Stock.

 

Section 9.                                           Stock Held For
Investment.  As a
condition to the delivery of the certificate for any shares of Stock purchased
pursuant to the exercise of this Option (or the registration of such Stock in
the name of Eligible Employee), Eligible Employee shall, if so requested by the
Company, hold such shares of Stock for investment and not with a view of resale
or distribution to the public and, if so requested by the Company, shall
deliver to the Company a written statement satisfactory to the Company to that
effect.

 

Section 10.                                     Other Laws.  If any change in circumstances after the grant
of this Option would create a substantial risk for the Company that the
issuance or transfer of any Stock under this Option to Eligible Employee at the
time Eligible Employee tenders any payment to exercise this Option would
violate any applicable law or regulation (including, without limitation,
federal or state securities laws), the Company at that time shall (a) take
such action as the Committee deems fair and reasonable and permissible under
such law or regulation either (1) to continue to maintain the status of
this Option as outstanding until Eligible Employee can exercise this Option
without any substantial risk of such a violation or (2) to fully and
fairly compensate Eligible 

 

5

 

Employee for the cancellation of this Option
and thereafter to cancel this Option and (b) refund any payment made by
Eligible Employee to exercise this Option.

 

Section 11.                                     Shareholders’
Agreement; Legends.  The Common
Stock issuable to Eligible Employee pursuant to the terms hereof shall be
subject to the terms and conditions of that certain Shareholders’ Agreement
dated as of December 1, 2007, between the Company and its stockholders
identified therein (as the same may be amended, restated, modified, or
otherwise supplemented from time-to-time, the “Shareholders’ Agreement”).  The certificate(s) evidencing the Stock
may include one or more legends that reference or describe the conditions upon
exercise referenced in this Section 11.

 

Section 12.                                     Withholding.  Employer or another Subsidiary or Affiliate
shall have the right upon the exercise of this Option to take such action as
Employer or such other Subsidiary or Affiliate deems necessary or appropriate
to satisfy the federal and state tax withholding requirements arising out of
the exercise of this Option, including (but not limited to) withholding shares
of Stock that otherwise would be transferred to Eligible Employee as a result
of the exercise of this Option to satisfy the minimum statutory withholding
requirements.

 

Section 13.                                     Confidentiality.  Eligible Employee agrees to keep this Option
and the Plan, including the terms herein and therein, confidential and to not
use or disclose, at any time, such terms; provided, however, that Eligible Employee may disclose the terms of
this Option to such advisors as is reasonably necessary for tax or estate
planning purposes.

 

Section 14.                                     Governing Law;
Limitation on Liability.  The
Plan and this Option shall be governed by the laws of the State of Delaware
(without giving effect to any choice or conflict of law provision or
rule).  IN NO EVENT SHALL THE COMPANY BE LIABLE FOR ANY INDIRECT DAMAGES, INCLUDING WITHOUT LIMITATION, LOST
PROFITS OR LOST OPPORTUNITY, OR ANY INDIRECT, SPECIAL, INCIDENTAL OR
CONSEQUENTIAL OR EXEMPLARY DAMAGES, INCLUDING LEGAL FEES.

 

Section 15.                                     Binding Effect.  This Option shall be binding upon the Company
and Eligible Employee and their respective heirs, executors, administrators and
successors.

 

Section 16.                                     Headings and
Sections.  The
headings contained in this Option Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Option.  Any references to sections in this Option
Agreement shall be to sections of this Option Agreement unless otherwise
expressly stated as part of such reference.

 

6

 

Exhibit A

 

2007
Stock Incentive Plan

 

See
attached.

 

7Exhibit 10.8

 

BONUS AWARD AGREEMENT

 

This Bonus Award Agreement (this “Agreement”), effective
as of October 27, 2009 (the “Effective Date”), evidences the grant
by Tops Holding Corporation (the “Company”), on the terms and subject to
the conditions set forth in this Agreement, of a cash bonus award to [                  ]
(the “Eligible Employee”).(1)

 

Section 1.                                            Definitions.  Capitalized terms used and not otherwise
defined herein shall have the meanings set forth in Annex I.

 

Section 2.                                            Payment of
Bonus.

 

(a)                                  General Rule. 
Subject to accelerated payment pursuant to the terms hereof and the
provisions of Section 2(b), the Eligible Employee shall be entitled to
receive $[                  ]
(the “Bonus Amount”), subject to and in accordance with the following
schedule, if Eligible Employee remains continuously employed by the Company or
an Affiliate or a Subsidiary (“Employer”) from the Effective Date
through the Vesting Date set forth in the schedule below:

 

	
  Vesting Date

  	
   

  	
  Percentage of Bonus Amount

  	
   

  
	
   

  	
   

  	
  33 1/3

  	
  %

  
	
   

  	
   

  	
  33 1/3

  	
  %

  
	
   

  	
   

  	
  33 1/3

  	
  %

  

 

Any
portion of the Bonus Amount that becomes payable on a Vesting Date specified
above will be paid not later than 60 days following that Vesting Date.

 

(b)                                 Termination. 
If Eligible Employee’s employment is terminated by the Employer for
Cause or due to the Eligible Employee’s resignation, any then unpaid portion of
the Bonus Amount shall be immediately and automatically forfeited upon such
termination or resignation, as applicable, and the Company shall have no
further obligation to make any payment of all or any portion of the Bonus
Amount thereafter.  If Eligible Employee’s
employment terminates due to Disability or death, then any unpaid portion of
the Bonus Amount shall be paid to the personal or legal representatives, if
any, or beneficiaries of Eligible Employee within 60 days of the date of such
termination.  The Board shall determine
whether Eligible Employee has a Disability. 
Notwithstanding the foregoing, in the event the Eligible Employee has an
employment agreement with the Company or any Subsidiary or Affiliate that
provides for termination for “disability,” the definition of “disability”
contained in such employment agreement shall govern this Agreement.

 

(1)                                  Note:  For Greg Josefowicz, this Agreement will be modified
to reflect that he is not an employee.

 

 

(c)                                  Change of Control. 
If there is a Change of Control, then the Board shall have the
discretion to provide that the entire unpaid portion of the Bonus Amount may be
paid on the Change Effective Date, but only if that Change of Control
constitutes a change in the ownership or effective control of
the Company or in the ownership of a substantial portion of the assets of the
Company as described in Section 409A(a)(2)(A)(v) of the Code and the
Board provides for such payment under all similar arrangements as provided by
said Section 409A and the regulations thereunder. 
If there is a Change of Control, and if Eligible Employee’s employment
with the purchaser or entity resulting from or surviving such Change of Control
is terminated involuntarily without Cause or due to death or Disability within
one year of the Change Effective Date for such Change of Control, then any
unpaid portion of the Bonus Amount shall be paid on the effective date of such
termination.

 

Section 3.                                            Nontransferable;
Source of Benefits.  Benefits
hereunder are not subject to alienation, anticipation, transfer or assignment
by the Eligible Employee and are not subject to being attached or reached and
applied by any creditor of the Eligible Employee.  Benefits shall be paid from the general
assets of the Company, and no Eligible Employee shall have a right to a benefit
hereunder greater than that of an unsecured general creditor thereof.

 

Section 4.                                            No Right to
Continue Service.  Neither
this Agreement nor any related material shall give Eligible Employee the right
to continue in employment by Employer or any other Subsidiary or Affiliate or
shall adversely affect the right of Employer or any Subsidiary or Affiliate to
terminate Eligible Employee’s employment with or without Cause at any time.

 

Section 5.                                            Withholding.  Employer or another Subsidiary or Affiliate
shall have the right upon payment of all or any portion of the Bonus Amount to
take such action as Employer or such other Subsidiary or Affiliate deems
necessary or appropriate to satisfy any tax or other withholding requirements
arising out of the Bonus Amount.

 

Section 6.                                            Confidentiality.  Eligible Employee agrees to keep this
Agreement and the Bonus Amount, including the terms hereof, confidential and to
not use or disclose, at any time, such terms; provided,
however, that Eligible Employee may
disclose the terms of this Agreement to such advisors as is reasonably
necessary for tax or estate planning purposes.

 

Section 7.                                            Governing Law; Limitation
on Liability.  This
Agreement shall be governed by the laws of the State of Delaware (without
giving effect to any choice or conflict of law provision or rule).  IN NO EVENT SHALL THE COMPANY BE LIABLE FOR ANY INDIRECT DAMAGES, INCLUDING WITHOUT LIMITATION, LOST
PROFITS OR LOST OPPORTUNITY, OR ANY INDIRECT, SPECIAL, INCIDENTAL OR
CONSEQUENTIAL OR EXEMPLARY DAMAGES, INCLUDING LEGAL FEES.

 

Section 8.                                            Binding Effect.  This Agreement shall be binding upon the
Company and Eligible Employee and their respective heirs, executors,
administrators and successors.  The
Company shall have discretion to operate, interpret and implement this
Agreement.  The 

 

2

 

decisions and determinations (including
determinations of the meaning and reference of terms used in this Agreement) of
the Company shall be conclusive upon all Persons.

 

Section 9.                                            Headings and
Sections.  The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.  Any references to sections in this Agreement
shall be to sections of this Agreement unless otherwise expressly stated as
part of such reference.

 

Section 10.                                      Entire
Agreement.  This
Agreement constitutes the entire agreement of the Company with respect to the
subject matter thereof and cannot be amended by any oral statement or otherwise
except by a written document referring to this Section 10 that is executed
by the Company and the Eligible Employee.

 

Section 11.                                      Section 409A.  The provisions of this Agreement are intended
and shall be interpreted and administered so as to not result in the imposition
of additional tax or interest under Section 409A of the Code where
applicable.  Without limiting the foregoing,
this Agreement shall not be amended in a manner so as to result in the
imposition of such tax or interest, and any reference to “termination of
employment” or similar term shall mean an event that constitutes a “separation
from service” within the meaning of Section 409A of the Code, and if at
separation from service the Eligible Employee is considered a “specified
employee” within the meaning of said Section 409A, then any payments
hereunder that are nonqualified deferred compensation within the meaning of
said Section 409A that are to be made upon separation from service shall
be accumulated and paid to the Eligible Employee in a lump sum six months and
one day following the separation from service (or if the Eligible Employee dies
during such six-month period, as soon as practical following the date of
death).

 

Section 12.                                      Financing
Documents. 
Notwithstanding anything set forth in this Agreement to the contrary,
the Company shall not be obligated to pay, and Eligible Employee shall not be
entitled to receive, any portion of the Bonus Amount to the extent that payment
thereof would be prohibited or blocked by the Financing Documents or would
otherwise result in the occurrence of a Default or an Event of Default or a
failure of the Company or any of its Subsidiaries or Affiliates to be in pro
forma compliance with the financial covenants under the Financing Documents (a “Payment
Blockage”); provided, however, that the
Company’s obligation to pay, and Eligible Employee’s entitlement to receive,
any portion of the Bonus Amount shall be reinstated, in arrears, once the
Default or Event of Default resulting in such Payment Blockage has been cured
or waived; provided, further, that no other Default
or Event of Default exists or would result from the payment or delivery of such
portion of the Bonus Amount and the Company would be in pro forma compliance
after giving effect thereto.

 

3

 

IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the Effective Date.

 

	
   

  	
  TOPS
  HOLDING CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [Name
  of Eligible Employee]

  

 

 

ANNEX I

 

DEFINED TERMS

 

“Affiliate” means any organization (other than
a Subsidiary) that would be treated as under common control with the Company
under Section 414(c) of the Code, if “50 percent” were substituted
for “80 percent” in the income tax regulations under Section 414(c) of
the Code.

 

“Beneficial Owner” has the meaning ascribed to
such term in Rule 13d-3 of the General Rules and Regulations under
the Securities Exchange Act of 1934, as amended.

 

“Board” means the Board of Directors of the
Company.

 

“Cause” means (i) the willful failure by
the Eligible Employee to perform such duties as are reasonably requested by the
Board or the Company’s Chief Executive Officer, as determined in good faith by
the Board, and such failure shall have continued for a period of ten (10) days
after the Company gives written notice to Eligible Employee specifying such
failure, (ii) the failure by the Eligible Employee to observe material
Company policies generally applicable to employees of the Company, (iii) gross
negligence or willful misconduct by the Eligible Employee in the performance of
his duties, as determined in good faith by the Board, (iv) the commission
by the Eligible Employee of any act of fraud (including, without limitation,
any material misrepresentation made by Eligible Employee to the Company or any
of its predecessors or Affiliates, including, without limitation, Morgan Stanley,
and their respective agents, in connection with such party’s evaluation of
Eligible Employee as a prospective employee), theft or financial dishonesty
with respect to the Company or any of its Affiliates, (v) the Eligible
Employee’s indictment, conviction of, or pleading no contest or nolo contendere to, any felony or a lesser crime involving
dishonesty or moral turpitude, (vi) breach of any material provision of
any employment agreement between Eligible Employee and the Company, (vii) failure
of the Eligible Employee to obtain or retain any permits, licenses or approvals
which may be required by any state or local authorities in order to permit the
Eligible Employee to continue employment in the ordinary course, (viii) any
act or omission that is materially injurious (financially or otherwise) to the
Company or its reputation, (ix) chronic absenteeism or (x) alcohol or
other substance abuse by the Eligible Employee. 
The Board shall determine whether Cause for termination exists.  Notwithstanding the foregoing, in the event
the Eligible Employee has an employment agreement with the Company or any of
its Affiliates that provides for termination for “cause” or “reasonable cause”,
the definition of cause or reasonable cause, as applicable, contained in such employment
agreement shall govern this Agreement.

 

“Change Effective Date” means the date which
includes the “closing” of the transaction which makes a Change of Control
effective.

 

“Change of Control” means that any of the
following events has occurred with respect to the Company, and the effective
date of the Change of Control shall be as of the first day that any one or more
of the following events shall have been fully and unconditionally effected:(a) Any
Person, other than (A) a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or an Affiliate; or (B) a Person
owned directly or indirectly by the stockholders of the Company in
substantially the same proportions as their ownership of stock of

 

2

 

the Company becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing more than 50% of the total voting power
represented by the Company’s Voting Securities;

 

(b)                                 After the Effective Date, the Company
consummates a merger or consolidation of the Company with any other Person,
other than a merger or consolidation that would result in the Voting Securities
of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into Voting Securities
of the surviving entity) more than 50% of the total voting power represented by
the Voting Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation;

 

(c)                                  The Company consummates a plan of
complete liquidation of the Company or an agreement for the sale or disposition
by the Company (in one transaction or a series of transactions) of all or
substantially all of the Company’s assets;

 

(d)                                 The Morgan Stanley Investors (as defined
in the Shareholders’ Agreement), or any one of them, Transfer(s) a number
of shares of the Company’s common stock equal to eighty percent (80%) multiplied by the aggregate number of shares of the Company’s
common stock then owned by the Morgan Stanley Investors, to any Person(s) other
than a Permitted Transferee(s) (as defined in the Shareholders’
Agreement); or

 

(e)                                  Any other condition or event that the
Board determines to be a “Change of Control”.

 

Notwithstanding
the foregoing, a “Change of Control” shall not include any acquisition
of securities or voting power directly from the Company through a Public
Offering.

 

“Code” means the Internal Revenue Code of 1986,
as amended.

 

“Default” shall have the meaning set forth in
the Financing Documents.

 

“Disability” has the same definition as under
the then-existing disability insurance plan covering Eligible Employee.

 

“Event of Default” shall have the meaning set
forth in the Financing Documents.

 

“Financing Documents” means any documents
related to any indebtedness of the Company or any of its Subsidiaries or
Affiliates, and any subsequent refinancing thereof.

 

“Person” means any natural person and any
company, government or political subdivision, agency or instrumentality of a
government; provided, that if two or more Persons
act as a partnership, limited partnership, joint venture, syndicate or other
group for the purpose of acquiring, holding or disposing of securities of the
Company, such partnership, limited partnership, joint venture, syndicate or
group shall be deemed to be a single Person for purposes of this Agreement.

 

“Public Offering” means the sale, in a public
offering registered under the Securities Act of 1933, as amended, of shares of
the Company’s common stock.

 

3

 

“Shareholders’ Agreement” means the
Shareholders’ Agreement between the Company and its shareholders identified
therein, as amended, amended and restated, supplemented or modified from time
to time.

 

“Subsidiary” means a corporation that is a
subsidiary corporation (within the meaning of § 424(f) of the Code) of the
Company.

 

“Voting Securities” means the Company’s then
outstanding securities that are entitled to vote generally in the election of directors.

 

4

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