Document:

Exhibit 10.14

 

FORM
OF SERIES A RESTRICTED STOCK UNIT AWARD

AGREEMENT

 

This Agreement (the
“Agreement”), dated
                  and
effective as of
                          ,
among Blue Ridge Paper Products Inc., a Delaware corporation (the “Company”), Blue
Ridge Holding Corp., a Delaware corporation (the “Parent”), and
                  (“Executive”).  Except as otherwise specifically provided
herein, capitalized terms used herein shall have the meanings attributed
thereto in the Employment Agreement between the Company and Executive, dated as
of
                        
(the “Employment Agreement”).

 

WHEREAS, pursuant to the
Subscription Agreement between Executive and Parent, dated as of December 22,
1999 (the “Subscription Agreement”), Executive purchased
              
shares of common stock of Parent, par value of $0.01 per share (the “Common
Stock”), and
              shares
of Series A Preferred Stock, par value of $0.01 per share (the “Preferred
Stock”), of Parent (such shares of Preferred Stock together with such shares of
Common Stock hereinafter called the “Purchased Shares”);

 

WHEREAS, pursuant to Section
       of the Employment Agreement, the Company
desires to grant to Executive restricted stock units in respect of
              shares
of Common Stock (the “Restricted Stock Units”) upon the achievement of certain
service criteria, on the terms and conditions, and subject to the restrictions,
set forth herein; and

 

WHEREAS, the award made in
this Agreement has been approved prior to its execution by the holders of 100%
of the voting power of all outstanding stock of the Company and by the holders
of more than 75% of the voting power of all outstanding stock of the Parent.

 

NOW, THEREFORE, in
connection with the mutual covenants hereinafter set forth and for other good
and valuable consideration, the parties hereto agree as follows:

 

1.                                       Grant of
Restricted Stock Units.  The
Parent hereby grants to Executive Restricted Stock Units in respect of
                 shares
of Restricted Stock subject to satisfaction of the service conditions set forth
in Section 4.

 

2.                                       Definitions.  For purposes of this Agreement:

 

(a)                                  “KPS Exit”
shall mean a sale or series of sales by KPS Special Situations Fund, L.P.
(“KPS”), KPS Supplemental Fund, L.P. (together with KPS, the “KPS Purchasers”),
or any affiliates of the KPS Purchasers in which such entities collectively
sell, directly or indirectly, in the aggregate more than eighty percent (80%)
of their aggregate initial equity investment in Parent, disregarding for this
purpose, sales or other transfers by such entities in which any of the KPS
Purchasers or their affiliates are purchasers or transferees.  As used herein, an “affiliate” of an entity
shall mean any person controlled by, controlling or under common control with
such entity.

 

(b)                                 “Restricted
Period” with respect to a Restricted Stock Unit shall mean the period prior to
the satisfaction of the Service Conditions (as defined in Section 4(a)) with
respect to such Restricted Stock Unit.

 

 

(c)                                  “Restricted Stock”
shall mean the Purchased Shares and any shares of stock delivered to Executive
pursuant to Section 6 upon settlement of any Restricted Stock Unit.

 

(d)                                 “ESOP” shall
mean the Blue Ridge Paper Products Employee Stock Ownership Plan.

 

(e)                                  “Fair Market Value”
shall be determined in good faith by the Board of Directors of the Company (the
“Board”) and shall equal the following: (i) if the date with respect to which
Fair Market Value is to be determined occurs in the first six months of a
calendar year, the fair market value of the Common Stock determined on behalf
of the ESOP with respect to December 31 of the preceding calendar year, and
(ii) if the date with respect to which Fair Market Value is to be determined
occurs other than in the first six months of a calendar year, the fair market
value of the Common Stock determined on behalf of the ESOP with respect to
December 31 of said calendar year.

 

(f)                                    “Federal
Short-Term Interest Rate” shall mean, on a given date, the applicable Federal
short-term rate (for quarterly compounding) in effect under section 1274(d) of
the Internal Revenue Code, as published from time to time by the Internal
Revenue Service.

 

3.                                       Non-Transferability.  (a) 
Executive may not sell, transfer, pledge, or otherwise encumber or
dispose of any Restricted Stock Unit and the Restricted Stock Units shall not
be transferable, whether voluntarily, by operation of law or otherwise,
including, but not by way of limitation, by execution, levy, garnishment,
attachment, pledge, bankruptcy or in any other manner, and no such Restricted
Stock Units shall be subject to any obligation or liability of Executive other
than to the Parent or the Company pursuant to this Agreement.

 

(b)                                 Restricted
Stock shall not be transferred except in accordance with this Agreement and the
Stockholders’ Agreement, dated as of May 14, 1999, between the Company and the
Stockholders listed therein, as amended, modified and supplemented from time to
time (the “Stockholders’ Agreement”), including Section 3.2(b) thereof.

 

4.                                       Service
Conditions and Lapse of Restricted Period.  (a)  The Restricted Period
with respect to thirty percent (30%) of the Restricted Stock Units shall be
deemed to have lapsed on the effective date of this Agreement, and the
Restricted Period with respect to the remaining seventy percent (70%) thereof
shall lapse during the period of the Executive’s employment with the Company
(and ratably on a daily basis within each year on the basis of the number of
days elapsed during such year prior to the effective date of any termination of
Executive’s employment with the Company) commencing June 28, 1999 pursuant to
the following schedule (the “Service Conditions”):

 

	
  In
  Year 3

  	
   

  	
  20

  	
  %

  
	
  In
  Year 4

  	
   

  	
  25

  	
  %

  
	
  In
  Year 5

  	
   

  	
  25

  	
  %

  

 

 

For purposes of the above
schedule, the terms “Year 3,” “Year 4,” and so on refer to the twelve (12)
month periods which end with the respective anniversaries of the Effective Date
of the Employment Agreement.  By way of
example, if Executive’s employment with the Company is terminated by the
Company with Cause or by Executive without Good Reason on the 95th day of Year
3, the Restricted Period shall have lapsed with respect to the number of
Restricted Stock Units equal to the sum of (i) the product of
                 multiplied
by 0.30 and (ii) the product of
                 multiplied
by 0.20, which is then multiplied by a fraction, the numerator of which is 94
and the denominator of which is 365.

 

(b)                                 In the event
that, prior to a KPS Exit, Executive’s employment with the Company is
terminated by the Company without Cause or by Executive with Good Reason or by
reason of Executive’s death or Disability at a time when the Restricted Period
has lapsed with respect to less than 50% of the Restricted Stock Units, the
Restricted Period shall lapse with respect to the number of Restricted Stock
Units then remaining subject to the Restricted Period at the time of such
termination equal to 31,500 minus the number of Restricted Stock Units with
respect to which the Restricted Period has lapsed pursuant to Section 4(a)
prior to such termination (including the thirty percent (30%) of Restricted
Stock Units as to which the Restricted Period is deemed to have lapsed on the
effective date of this Agreement).  Upon
such a termination of Executive’s employment as described hereinabove, any
Restricted Stock Units remaining subject to the Restricted Period after the
application of this Section 4(b) shall be immediately forfeited.

 

(c)                                  In the event
Executive’s employment with the Company is terminated for any reason, except as
otherwise provided in Section 4(b), any Restricted Stock Units remaining
subject to the Restricted Period at the time of such termination shall be
immediately forfeited.

 

(d)                                 In the event of
a KPS Exit or upon the KPS Purchasers and their affiliates ceasing to control,
directly or indirectly, a majority of the Board, which shall constitute a KPS
Exit for purposes of this Agreement, the Restricted Period shall lapse with
respect to any Restricted Stock Units not otherwise forfeited pursuant to
Section 4(c) hereof.

 

5.                                       No Rights as a
Shareholder.  Executive
shall have no rights of a stockholder, including, without limitation, voting
rights, with respect to Restricted Stock Units granted hereunder, until the
Executive agrees to be bound by the terms of the Stockholders’ Agreement.  Parent agrees to use its best efforts to
cause the Stockholders’ Agreement to be amended so that Executive shall be a
Shareholder as that term is defined therein and entitled to all the rights and
subject to all the obligations of a Shareholder thereunder, and so that all
shares of Restricted Stock, as defined herein, shall be and constitute
Registrable Securities as defined therein.

 

6.                                       Delivery of
Shares.  (a)  Stock certificates evidencing the number of shares of Restricted
Stock in respect of Restricted Stock Units as to which the Restricted Period
has lapsed shall be delivered to Executive by Parent on the earliest to occur
of: (i) the termination of Executive’s employment with the Company for any
reason; (ii) a KPS Exit; (iii) the date which is eighteen months after an
initial public offering of the Common Stock; (iv) the date when any right or
obligation to sell shares of Restricted Stock becomes effective hereunder

 

 

or under the Stockholders
Agreement; and (v) at the election of Executive, June 30, 2006; provided
that Executive may, by written notice to the Parent, and with the consent of
the Board, elect to defer delivery of such certificates to a date not less than
eighteen (18) months following receipt of such notice, but such election shall
be given effect only if Executive remains employed by the Company during the
twelve-month period following receipt of such notice.

 

(b)                                 Notwithstanding
any provision of this Agreement to the contrary, no stock certificates shall be
delivered to Executive hereunder, or to any other person or party at the
direction of Executive, unless Executive has executed the Stockholders’
Agreement.  Any such certificates so
delivered shall bear the following legend reflecting the applicability of the
Stockholders’ Agreement to the shares represented by such certificate.

 

THIS CERTIFICATE IS SUBJECT
TO, AND IS TRANSFERRABLE ONLY UPON COMPLIANCE WITH, THE PROVISIONS OF THE
RESTRICTED STOCK UNIT AWARD AGREEMENT AND THE STOCKHOLDERS AGREEMENT AMONG THE
COMPANY AND ITS STOCKHOLDERS.  A COPY OF
THE ABOVE REFERENCED AGREEMENTS ARE ON FILE AT THE PRINCIPAL OFFICES OF THE
COMPANY.

 

7.                                       Purchase for
Investment; Other Representations of Executive; Legends.

 

(a)                                  Investment
Intent.  Prior to delivery of any stock
certificate evidencing Restricted Stock, Executive will be required to
represent that such Restricted Stock is being acquired for investment and not
with a view to distribution thereof, and to make such other reasonable and
customary representations regarding matters relevant to compliance with
applicable securities laws as are deemed necessary by counsel to the
Parent.  Stock certificates evidencing
Restricted Stock that are delivered hereunder shall bear restrictive legends in
substantially the following form and such other restrictive legends as are
required or advisable under the provisions of any applicable laws or are
provided for in any other agreement to which Executive is a party:

 

THE SHARES REPRESENTED BY
THIS STOCK CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND SHALL NOT BE TRANSFERRED EXCEPT PURSUANT TO (I) AN
EFFECTIVE REGISTRATION STATEMENT, OR (II) AN EXEMPTION FROM REGISTRATION UNDER
SAID ACT.

 

(b)                                 Other
Representations.  Executive
hereby represents and warrants to the Parent and the Company as follows:

 

(i)                                     Access to
Information.  Because
Executive’s business relationship with the Parent and the Company and with the
management of the Parent and the Company, Executive has had access to all
material and relevant information concerning the Parent and the Company,
thereby enabling Executive to make an informed investment decision with respect
to his investment in the Parent and the Company, and all pertinent data and

 

 

information requested by
Executive from the Parent and the Company or its representatives concerning the
business and financial condition of the Parent and the Company and the terms
and conditions of this Agreement have been furnished to Executive.  Executive acknowledges that Executive has
had the opportunity to ask questions of and receive answers and obtain
additional information from the Parent and the Company and its representatives
concerning the present and proposed business and financial conditions of the
Parent and the Company.

 

(ii)                                  Financial
Sophistication.  Executive
has such knowledge and experience in financial and business matters that
Executive is capable of evaluating the merits and risks of investing in the
Restricted Stock.

 

(iii)                               Understanding
the Investment Risks.  Executive
understands that:

 

A.                                   An investment
in the Restricted Stock represents a highly speculative investment, and there
can be no assurance as to the success of the Parent or the Company in its
business; and

 

B.                                     There is at
present no market for the Restricted Stock and there can be no assurance that a
market will develop in the future.

 

(iv)                              Understanding
of the Nature of the Restricted Stock.  Executive understands and agrees that:

 

A.                                   There can be no
assurance that the Restricted Stock will be registered under the Securities Act
of 1933, as amended (the “Securities Act”) or any applicable state securities
laws and if they are not so registered, they will only be issued and sold in
reliance upon certain exemptions contained in the Securities Act and applicable
state securities laws, and the representations and warranties of Executive
contained herein, which are required to be renewed as to the Restricted Stock
at the times of delivery of stock certificates evidencing the Restricted Stock,
are essential to any claim of exemption by the Parent or the Company under the
Securities Act and such state laws;

 

B.                                     If the
Restricted Stock is not so registered, the Restricted Stock will be “restricted
securities” as that term is defined in Rule 144 promulgated under the
Securities Act;

 

C.                                     Executive may
not sell or transfer the Restricted Stock without registration under the
Securities Act and applicable state securities laws unless Parent receives an
opinion of counsel acceptable to it (as to both counsel and the opinion) that
such registration is not required;

 

D.                                    Only Parent can
register the Restricted Stock under the Securities Act and applicable state
securities laws;

 

E.                                      Neither the
Company nor the Parent has made any representations to Executive that Parent
will register the Restricted Stock under the

 

 

Securities
Act or any applicable state securities laws, or with respect to compliance with
any exemption therefrom;

 

F.                                      Executive is
aware of the conditions for Executive’s obtaining an exemption for the sale or
transfer of the Restricted Stock under the Securities Act and any applicable
state securities laws; and

 

G.                                     Parent and the
Company may, from time to time, make stop transfer notations in its transfer
record to ensure compliance with the Securities Act and any applicable state
securities laws, and any additional restrictions imposed by state securities
administrators.

 

(v)                                 Investment
Intent.  Executive acknowledges that:

 

A.                                   Executive is
acquiring the Restricted Stock Units and Restricted Stock for Executive’s own
account and not on behalf of any other person;

 

B.                                     Executive is
acquiring the Restricted Stock Units and Restricted Stock for investment and
not with a view to distribution or with the intent to divide Executive’s
participation with others or sell or otherwise distribute the Restricted Stock
Units or the Restricted Stock;

 

C.                                     Neither
Executive nor anyone acting on Executive’s behalf has paid or will pay a
commission or other remuneration to any person in connection with the
acquisition of the Restricted Stock Units or the Restricted Stock; and

 

D.                                    At the time and
as a condition of delivery of stock certificates evidencing the Restricted
Stock, Executive will be deemed to have made all the representations and
warranties contained in this Section 7 with respect to such Restricted Stock
and may be required to make other representations concerning investment intent
as a condition of the delivery of such Restricted Stock by the Parent.

 

8.                                       Rights on
Termination of Employment.

 

(a)                                  Termination
Without Cause or for Good Reason.

 

(i)                                     If Executive’s
employment with the Company is terminated by Executive for Good Reason or by
the Company without Cause, the Parent shall have the right (but not the
obligation) to purchase all or any portion of Executive’s Restricted Stock from
Executive for an amount equal to the number of shares of such Restricted Stock
multiplied by the Fair Market Value of each such share of Restricted Stock with
respect to the date of exercise of such right. 
The Parent’s said right may be exercised at any time or from time to
time (A) with respect to Purchased Shares, during the 90-day period commencing
on the date of such termination and (B) with respect to shares of Restricted
Stock in respect of Restricted Stock Units, during the 90-day period commencing
on the date which is six months following the date on which stock certificates
representing such shares of Restricted Stock are delivered to Executive
pursuant to Section 6.

 

 

(ii)                                  If Executive’s
employment with the Company is terminated by Executive for Good Reason or by
the Company without Cause, Executive shall have the right (but not the
obligation) to require the Parent to purchase (the “Put Right”) all of
Executive’s Restricted Stock not purchased by the Parent pursuant to Section
8(a)(i) for an amount equal to the number of shares of such Restricted Stock
multiplied by the Fair Market Value of each such share with respect to the date
of the exercise of such Put Right. 
Executive’s Put Right with respect to the Restricted Stock may be exercised
at any time or from time to time (A) with respect to Purchased Shares, during
the 90-day period commencing on the date of such termination and (B) with
respect to shares of Restricted Stock in respect of Restricted Stock Units,
during the 90-day period commencing on the date which is six months following
the date on which stock certificates representing such shares of Restricted
Stock are delivered to Executive pursuant to Section 6.

 

(b)                                 Termination For
Cause, Without Good Reason or Upon End of Term.

 

(i)                                     If Executive’s
employment with the Company is terminated by Executive without Good Reason or
by the Company with Cause or Executive’s employment terminates upon the end of
the Term of the Employment Agreement, the Parent shall have the right (but not
the obligation) to purchase all or any portion of Executive’s Restricted Stock
for an amount equal to the number of shares of such Restricted Stock multiplied
by the Fair Market Value of each such share with respect to the date of
exercise of such right.  The Parent’s
said right may be exercised at any time or from time to time (A) with respect
to Purchased Shares, during the 90-day period commencing on the date of such
termination and (B) with respect to shares of Restricted Stock in respect of
Restricted Stock Units, during the 90-day period commencing on the date which
is six months following the date on which stock certificates representing such
shares of Restricted Stock are delivered to Executive pursuant to Section 6.

 

(ii)                                  If a KPS Exit
occurs following a termination referred to in Section 8(b)(i), Executive shall
have a Put Right with respect to Executive’s Restricted Stock not purchased by
the Parent pursuant to Section 8(b)(i) for an amount equal to the number of
such shares of Restricted Stock multiplied by the Fair Market Value of each
such share with respect to the date of the KPS Exit.  Executive’s Put Right may be exercised at any time or from time
to time (A) with respect to Purchased Shares, during the 90-day period
commencing on the date of such KPS Exit and (B) with respect to shares of
Restricted Stock in respect of Restricted Stock Units, during the 90-day period
commencing on the date which is six months following the date on which stock
certificates representing such shares of Restricted Stock are delivered to
Executive pursuant to Section 6.

 

(c)                                  Death and
Disability.

 

(i)                                     If Executive’s
employment with the Company is terminated as a result of the death or
Disability of Executive, the Parent shall have the right (but not the obligation)
to purchase all or any portion of Executive’s Restricted Stock from Executive
(or, if applicable, his estate or the person then acting on Executive’s behalf)
for an amount equal to the number of shares of such Restricted Stock multiplied
by the Fair Market Value of each such share with respect to the date of
exercise of such right.  The Parent’s
said right may be exercised

 

 

at any time or from time to
time (A) with respect to Purchased Shares, during the 90-day period commencing
on the date of such termination and (B) with respect to shares of Restricted
Stock in respect of Restricted Stock Units, during the 90-day period commencing
on the date which is six months following the date on which stock certificates
representing such shares of Restricted Stock are delivered to Executive
pursuant to Section 6.

 

(ii)                                  Upon such a
termination referred to in Section 8(c)(i), Executive (or, if applicable, his
estate or the person then acting on Executive’s behalf) shall have a Put Right
with respect to Executive’s Restricted Stock not purchased pursuant to 8(c)(i)
for an amount equal to the number of shares of such Restricted Stock multiplied
by the Fair Market Value of each such share with respect to the date of
exercise of such Put Right.  Executive’s
Put Right may be exercised at any time or from time to time (A) with respect to
Purchased Shares, during the 365-day period commencing on the date of such
termination and (B) with respect to shares of Restricted Stock in respect of
Restricted Stock Units, during the 365-day period commencing on the date which
is six months following the date on which stock certificates representing such
shares of Restricted Stock are delivered to Executive pursuant to Section 6.

 

(d)                                 Additional
Rights.

 

(i)                                     Subject to the
Parent’s financing agreements, if Executive exercises any Put Right described
in Section 8(a), (b) or (c) above, the Parent or the Company shall pay to him
within one year following the date of the exercise of such Put Right the
purchase price of the Restricted Stock being purchased by the Parent pursuant
to such Put Right with interest from the date of exercise of such Put Right at
the Federal Short-Term Interest Rate in effect on the first day of the month of
such exercise, to be recalculated on the first day of each month thereafter
until all payments are made.  If the
Parent is unable to pay Executive for the Restricted Stock in accordance with
the preceding sentence as a result of any covenant in any of its financing
agreements, the Parent shall pay Executive for such Restricted Stock as soon as
possible under such financing agreements, with interest at the Federal
Short-Term Interest Rate in effect on the first day of the month of termination
to be recalculated on the first day of each month thereafter until all payments
are made, or at the option of Executive, exercise of the Put Right may be
rescinded by Executive and the Restricted Stock returned to Executive.

 

(ii)                                  If there has
not been a KPS Exit prior to December 31, 2004, Executive will have a Put Right
during the ninety (90) day period following December 31, 2004 with respect to
any Purchased Shares.  If there has not
been a KPS Exit prior to December 31, 2006, Executive will have a Put Right
during the ninety (90) day period following December 31, 2006 with respect to
any shares of Restricted Stock in respect of Restricted Stock Units, share
certificates for which he has then held for a period of not less than six
months.  If there has been a KPS Exit
prior to December 31, 2006 in connection with which Executive is not permitted
to sell all of his Restricted Stock, Executive will have a Put Right during the
ninety (90) day period following December 31, 2006 with respect to any shares
of Restricted Stock, share certificates for which he has then held for a period
of not less than six months.  The
purchase price of such Restricted Stock will be the Fair Market Value of such
Restricted Stock as of the date of exercise of the applicable Put Right and
will be paid in equal annual installments by Parent upon each of the first four
(4) anniversaries of the date of the exercise of such Put Right, earning
interest at the Federal Short-Term Interest Rate.

 

 

(iii)                               Executive shall
have no Put Rights under this Agreement with respect to Restricted Stock at any
time that the Common Stock is (i) publicly traded, 

(ii) registered pursuant to the Securities Act and (iii) transferable by the
Executive, subject to normal securities law restrictions applicable to trading
of registered securities by an executive officer of an issuer or reasonable
restrictions imposed on such transfers by an underwriter of such stock.

 

(iv)                              Any Put Right
under this Agreement with respect to the Restricted Stock will be necessarily
subject to those conditions imposed by the Parent and the Company’s financing
documents or other contract to which the Parent or the Company is a party or by
applicable law; provided, however, that Parent will use its reasonable
efforts to purchase and pay for any Restricted Stock put to Parent by Executive
on a pari passu basis with any other shares put to Parent by any employee or
officer of Parent or of the Company to the extent that any such purchase is
permitted under such financing documents, contracts or laws; provided
further that any shares held by the ESOP (including for the account of
Executive) shall have a priority with respect to such purchases.

 

(v)                                 If Parent shall
exercise any right to purchase any Restricted Stock of Executive pursuant to
this Section 8, Parent or the Company shall pay to Executive (or his estate)
the full amount of the purchase price therefor on the date of exercise of such
right.  The amount of such payment on
the date of exercise of such right (the “Preliminary Payment”) shall be
calculated using the Fair Market Value of each share determined pursuant to 

Section 2(e)(i); provided, however, that if such exercise occurs other than in
the first six months of the calendar year, the purchase price for purposes of
this Section 8(d)(iv) shall be recalculated using the Fair Market Value of each
share determined pursuant to Section 2(e)(ii) and, if such recalculated
purchase price (the “Recalculated Price”) exceeds the Preliminary Payment,
Parent or the Company shall pay to Executive the amount of such excess as
promptly as possible following the determination of the Recalculated Price with
interest from the date of exercise of such purchase right at the Federal
Short-Term Interest Rate; and if the Recalculated Price is less than the
Preliminary Payment, Executive shall pay to Parent or the Company, as
applicable, the amount of such difference as promptly as possible following the
determination of the Recalculated Price with interest from the date of exercise
of such purchase right at the Federal Short-Term Interest Rate.

 

9.                                       Miscellaneous.

 

(a)                                  Notices.  All notices or other communications required
or permitted hereunder shall be in writing and shall be delivered personally or
by reputable commercial messenger service, telecopied, or sent by certified,
registered or express mail, postage prepaid. 
Any such notice shall be deemed given when so delivered personally or by
such messenger service or so telecopied or, if sent by certified, registered or
express mail, five days after the date of deposit in the United States mail, as
follows:

 

 

(i)                                     if to the
Parent or the Company:

 

Blue Ridge Paper Products
Inc.

1 West Pack Square, Suite
1100

Asheville, North Carolina
28801

Attention: President

Telecopy: (828) 254-6461

 

and with a copy to:

 

Paul, Weiss, Rifkind,
Wharton & Garrison

1285 Avenue of the Americas

New York, New York
10019-6064

Attention: Robert C. Fleder,
Esq.

Telecopy: (212) 373-2296

 

(ii)                                  if to
Executive:

 

Richard Lozyniak

1 Stuyvesant Crescent

Asheville, NC 28803

 

Any party may, by notice
given in accordance with this Section 9(a), designate another address or person
for receipt of notices hereunder.

 

(b)                                 Arbitration.

 

(i)                                     Notwithstanding
any other provision of this Agreement to the contrary, any disputes hereunder
relating to this Agreement shall be settled exclusively by arbitration
conducted in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, as more particularly described in this Section 9(b)
(the “Arbitration Rules”).  Any
arbitration shall be governed by the United States Arbitration Act, 9 U.S.C.
Sections 1-16, and (notwithstanding anything herein to the contrary) judgment
upon the award rendered by the Arbitrator may be entered by any court having
competent jurisdiction.  The place of
the arbitration shall be Charlotte, North Carolina.

 

(ii)                                  There will be
one neutral arbitrator (the “Arbitrator”) who will be a practicing attorney and
will be selected by mutual agreement of the parties to the arbitration and, in
the absence of such agreement, will be chosen by the American Arbitration
Association or, if it is not then in existence, by any other reputable dispute
resolution firm agreed to by the parties.

 

(iii)                               The parties
intend that the Arbitrator shall resolve any dispute arising hereunder based
upon the language of this Agreement and the applicable rules of contract
interpretation.  All awards and orders
of the Arbitrator may be enforced by any court of competent jurisdiction.

 

 

(iv)                              The parties
intend that any arbitration proceeding be conducted as expeditiously as
possible and that appropriate rights of discovery be granted to each party to
such arbitration (as determined by the Arbitrator).  In that regard, the parties to such arbitration agree to work
together in good faith to arrive upon mutually acceptable procedures regarding
the time limits for, and nature and extent of, such rights of discovery and the
periods of time within which the matters submitted to arbitration must be heard
and determined by the Arbitrator.  If
the parties to such arbitration are unable to so agree, such issues will be
submitted to the Arbitrator for determination. 
If proper notice of any hearing has been given, the Arbitrator will have
full power to proceed to take evidence or to perform any other acts necessary
to arbitrate the matter in the absence of any party who fails to appear.  The Arbitrator, attorneys, parties to the
arbitration, witnesses, experts, court reporters, or other persons present at
the arbitration shall agree in writing to maintain the strict confidentiality
of the arbitration proceedings.

 

(v)                                 The parties to
any arbitration, by written stipulation, may expand or reduce the rights,
duties or obligations provided above, or otherwise modify the arbitration
procedures to suit their convenience, consistent with what is otherwise
permitted and feasible within the framework of the Arbitration Rules.

 

(vi)                              Any decision or
award of the Arbitrator shall be final and binding upon the parties to the
arbitration proceeding, except to the extent otherwise expressly provided by
North Carolina law.  The parties hereto
hereby waive to the extent permitted by law any rights to appeal or to a review
of such award by any court or tribunal. 
The parties agree that the award of the Arbitrator may be enforced
against the parties to the proceeding or their assets wherever they may be
found.

 

(vii)                           At any time
during the arbitration proceedings specified in this Section 9(b) a party may
seek a preliminary injunction or other provisional judicial relief if in its
judgment such action is necessary to avoid irreparable damage or to preserve
the status quo.  Despite such action,
the parties will continue to participate in good faith in the arbitration
proceedings specified in this Section 9(b). 
All passage of time shall be tolled for purposes of any applicable
statute of limitations or the equitable doctrine of laches while the
arbitration proceedings specified in this Section 9(b) are pending.  The parties will take such action, if any,
as is required to effectuate such tolling.

 

(viii)                        All costs and
fees associated with any arbitration conducted pursuant to this Section 9(b)
shall initially be paid by each party thereto. 
At the conclusion of any arbitration under this Agreement, however, the
Arbitrator shall award to the prevailing party all costs and fees associated
with such arbitration, including, without limitation, the prevailing party’s
actual and reasonable attorneys’ fees and all Arbitrator fees.

 

10.                                 Binding Effect.  This Agreement shall be binding upon the
heirs, executors, administrators and successors and assigns of the parties
hereto.

 

11.                                 Governing Law.  This Agreement shall be governed by, and
construed and interpreted in accordance with, the laws of the State of North
Carolina without reference to principles of conflict of laws.

 

 

12.                                 Headings.  Headings used herein are for convenience of
reference only, do not constitute a part of this Agreement and shall not be
deemed to limit or affect any of the provisions hereof.

 

13.                                 Severability.  To the extent any portion of this Agreement
or any portion of any provision of this Agreement is held to be invalid, void
or unenforceable by a court of competent jurisdiction, such court shall
substitute a valid, enforceable provision that preserves, to the maximum lawful
extent, the terms and intent of this Agreement.

 

14.                                 Withholding.  Upon the delivery of any stock certificates
evidencing shares of Restricted Stock to the Executive pursuant to Section 6,
Executive may satisfy the amount of any income tax withholding required by law
(and Parent shall timely remit such amount to the relevant taxing authorities)
by either of the following methods, or by a combination of such methods: (a)
tendering a cash payment to the Parent or (b) delivering to the Company
previously acquired shares of Restricted Stock or having the Parent withhold
stock certificates for shares of Restricted Stock otherwise then deliverable to
Executive having an aggregate fair market value (determined in good faith by
the Board) equal to the amount of such withholding obligation.  The satisfaction of such withholding
obligation shall be a condition precedent to the delivery to Executive of stock
certificates in accordance with Section 6.

 

15.                                 Adjustment to
Restricted Stock and/or Restricted Stock Units.  If there shall be any change in the outstanding shares of Common
Stock or Preferred Stock by reason of any stock split, stock dividend, merger,
consolidation, combination or exchange of shares for other securities,
recapitalization, or similar corporate change, then the number of Restricted
Stock Units or shares of Restricted Stock, as the case may be, referred to
herein or in the Subscription Agreement, shall be automatically and
appropriately adjusted to give effect to such change.

 

16.                                 Third-Party
Beneficiary.  There are
no beneficiaries to this Agreement other than the signatories hereto.

 

 

17.                                 Inconsistent
Agreement.  To the
extent that any provision of this Agreement is inconsistent with the
Stockholders’ Agreement, the terms of this Agreement shall govern.

 

EXECUTED on the day and year
first written above.

 

	
   

  	
  BLUE RIDGE PAPER PRODUCTS
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BLUE RIDGE HOLDING CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:Exhibit 10.15

 

FORM OF SERIES
B RESTRICTED STOCK UNIT AWARD

AGREEMENT

 

This Agreement (the “Agreement”), dated
        , and effective as of
         (the “Effective Date”), among
Blue Ridge Paper Products Inc., a Delaware corporation (the “Company”), Blue
Ridge Holding Corp., a Delaware corporation (the “Parent”), and
            
(“Executive”).

 

WHEREAS, the Company desires to grant to Executive restricted stock
units (the “Restricted Stock Units”) in respect of
         shares of common stock of
Parent par value of $0.01 per share (the “Common Stock”) upon the achievement
of certain service criteria, on the terms and conditions, and subject to the
restrictions, set forth herein; and

 

WHEREAS, the award made in this Agreement has been approved prior to
its execution by the holders of 100% of the voting power of all outstanding
stock of the Company and by the holders of more than 75% of the voting power of
all outstanding stock of the Parent.

 

NOW, THEREFORE, in connection with the mutual covenants hereinafter set
forth and for other good and valuable consideration, the parties hereto agree
as follows:

 

1.                           Grant of Restricted Stock
Units.  The Parent hereby grants to
Executive Restricted Stock Units in respect of
         shares of Common Stock subject
to satisfaction of the service conditions set forth in Section 4.

 

2.                           Definitions.  For purposes of this Agreement:

 

(a)                                  “KPS
Exit” shall mean a sale or series of sales by KPS Special Situations Fund, L.P.
(“KPS”), KPS Supplemental Fund, L.P. (together with KPS, the “KPS Purchasers”),
or any affiliates of the KPS Purchasers in which such entities collectively
sell, directly or indirectly, in the aggregate more than eighty percent (80%)
of their aggregate initial equity investment in Parent, disregarding for this purpose,
sales or other transfers by such entities in which any of the KPS Purchasers or
their affiliates are purchasers or transferees.  As used herein, an “affiliate” of an entity shall mean any person
controlled by, controlling or under common control with such entity.

 

(b)                                 “Restricted
Period” with respect to a Restricted Stock Unit shall mean the period prior to
the satisfaction of the Service Conditions (as defined in Section 4(a))
with respect to such Restricted Stock Unit.

 

(c)                                  “Restricted
Stock” shall mean any shares of stock delivered to Executive pursuant to
Section 6 upon settlement of any Restricted Stock Unit.

 

(d)                                 “ESOP”
shall mean the Blue Ridge Paper Products Employee Stock Ownership Plan.

 

 

(e)                                  “Fair
Market Value” shall be determined in good faith by the Board of Directors of
the Company (the “Board”) and shall equal the following: (i) if the date with
respect to which Fair Market Value is to be determined occurs in the first six
months of a calendar year, the fair market value of the Common Stock determined
on behalf of the ESOP with respect to December 31 of the preceding
calendar year, and (ii) if the date with respect to which Fair Market Value is
to be determined occurs other than in the first six months of a calendar year,
the fair market value of the Common Stock determined on behalf of the ESOP with
respect to December 31 of said calendar year.

 

(f)                                    “Federal
Short-Term Interest Rate” shall mean, on a given date, the applicable Federal
short-term rate (for quarterly compounding) in effect under
section 1274(d) of the Internal Revenue Code, as published from time to
time by the Internal Revenue Service.

 

(g)                                 “Cause”
shall mean (i) the willful failure or refusal by Executive to perform his
duties to the Company (other than any such failure or refusal resulting from
Executive’s incapacity due to physical or mental illness); provided that the
Company shall provide Executive with notice of such failure or refusal and
Executive shall not have remedied such failure or refusal within fifteen days
of receipt of notice thereof; (ii) the commission by Executive of any material
act of dishonesty or breach of trust in connection with the performance of his
duties hereunder; or (iii) Executive’s being convicted of, or pleading guilty
or no contest to, any felony or any lesser crime having as its predicate
element fraud, dishonesty or misappropriation. 
For purposes of clause (i), no failure or refusal on Executive’s part
shall be deemed “willful” if done, or omitted to be done, by Executive in the
reasonable belief that his failure or refusal was in the best interest of the
Company.

 

(h)                                 “Good
Reason” shall mean the Company, without Executive’s consent, assigning to him
duties inconsistent with his position, title, authority or duties which results
in a substantial diminution of such position, title, authority or duties;
provided that Executive shall provide the Company with notice of such
diminution and the Company shall not have remedied such diminution within
fifteen days of receipt of notice thereof.

 

3.                           Non-Transferability.  (a) 
Executive may not sell, transfer, pledge, or otherwise encumber or
dispose of any Restricted Stock Unit and the Restricted Stock Units shall not
be transferable, whether voluntarily, by operation of law or otherwise, including,
but not by way of limitation, by execution, levy, garnishment, attachment,
pledge, bankruptcy or in any other manner, and no such Restricted Stock Units
shall be subject to any obligation or liability of Executive other than to the
Parent or the Company pursuant to this Agreement.

 

(b)                                 Restricted
Stock shall not be transferred except in accordance with this Agreement and the
Stockholders’ Agreement, dated as of May 14, 1999, between the Company and the
Stockholders listed therein, as amended, modified and supplemented from time to
time (the “Stockholders’ Agreement”), including Section 3.2(b) thereof;

 

4.                           Service Conditions and
Lapse of Restricted Period. 
(a)  The Restricted Period with
respect to twenty-five percent (25%) of the Restricted Stock Units shall be
deemed to have lapsed on the Effective Date, and the Restricted Period with
respect to the remaining seventy-five percent (75%) thereof shall lapse during
the period of the Executive’s

 

2

 

employment with the Company (and ratably on a daily basis within each
year on the basis of the number of days elapsed during such year prior to the
effective date of any termination of Executive’s employment with the Company)
commencing on the Effective Date pursuant to the following schedule (the
“Service Conditions”):

 

	
  In Year 1

  	
   

  	
  25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  In Year 2

  	
   

  	
  25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  In Year 3

  	
   

  	
  25

  	
  %

  

 

For purposes of the above schedule, the terms “Year 1,” “Year 2” and
“Year 3” refer to the twelve (12) month periods which end with the respective
anniversaries of the Effective Date.  By
way of example, if Executive’s employment with the Company is terminated by the
Company with Cause or by Executive without Good Reason on the 95th day of Year
1, the Restricted Period shall have lapsed with respect to the number of
Restricted Stock Units equal to the sum of (i) the product of
         multiplied by 0.25 and (ii)
the product of          multiplied by
0.25, which is then multiplied by a fraction, the numerator of which is 94 and
the denominator of which is 365.

 

(b)                                 In
the event that, prior to a KPS Exit, Executive’s employment with the Company is
terminated by the Company without Cause or by Executive with Good Reason or by
reason of Executive’s death or Disability at a time when the Restricted Period
has lapsed with respect to less than 50% of the Restricted Stock Units, the
Restricted Period shall lapse with respect to the number of Restricted Stock
Units then remaining subject to the Restricted Period at the time of such
termination equal to 6,000 minus the number of Restricted Stock Units with
respect to which the Restricted Period has lapsed pursuant to Section 4(a)
prior to such termination (including the twenty-five percent (25%) of the
Restricted Stock Units as to which the Restricted Period is deemed to have
lapsed on the Effective Date).  Upon
such a termination of Executive’s employment as described hereinabove, any
Restricted Stock Units remaining subject to the Restricted Period after the
application of this Section 4(b) shall be immediately forfeited.

 

(c)                                  In
the event Executive’s employment with the Company is terminated for any reason,
except as otherwise provided in Section 4(b), any Restricted Stock Units
remaining subject to the Restricted Period at the time of such termination
shall be immediately forfeited.

 

(d)                                 In
the event of a KPS Exit or upon the KPS Purchasers and their affiliates ceasing
to control, directly or indirectly, a majority of the Board, which shall
constitute a KPS Exit for purposes of this Agreement, the Restricted Period
shall lapse with respect to any Restricted Stock Units not otherwise forfeited
pursuant to Section 4(c) hereof.

 

5.                           No Rights as a
Shareholder.  Executive shall have
no rights of a stockholder, including, without limitation, voting rights, with
respect to Restricted Stock Units granted hereunder, until the Executive agrees
to be bound by the terms of the Stockholders’ Agreement.  Parent agrees to use its best efforts to
cause the Stockholders’ Agreement to be

 

3

 

amended so that Executive shall be a Shareholder as that term is
defined therein and entitled to all the rights and subject to all the
obligations of a Shareholder thereunder, and so that all shares of Restricted
Stock, as defined herein, shall be and constitute Registrable Securities as
defined therein.

 

6.                           Delivery of Shares.  (a) 
Stock certificates evidencing the number of shares of Restricted Stock
in respect of Restricted Stock Units as to which the Restricted Period has
lapsed shall be delivered to Executive by Parent on the earliest to occur
of:  (i) the termination of
Executive’s employment with the Company for any reason; (ii) a KPS Exit;
(iii) the date which is eighteen months after an initial public offering
of the Common Stock; (iv) the date when any right or obligation to sell
shares of Restricted Stock becomes effective hereunder or under the
Stockholders Agreement; and (v) at the election of Executive,
June 30, 2006; provided that Executive may, by written notice to the
Parent, and with the consent of the Board, elect to defer delivery of such
certificates to a date not less than eighteen (18) months following receipt of
such notice, but such election shall be given effect only if Executive remains
employed by the Company during the twelve-month period following receipt of
such notice.

 

(b)                                 Notwithstanding
any provision of this Agreement to the contrary, no stock certificates shall be
delivered to Executive hereunder, or to any other person or party at the
direction of Executive, unless Executive has executed the Stockholders’
Agreement.  Any such certificates so
delivered shall bear the following legend reflecting the applicability of the
Stockholders’ Agreement to the shares represented by such certificate.

 

THIS CERTIFICATE IS SUBJECT TO, AND IS TRANSFERRABLE ONLY UPON
COMPLIANCE WITH, THE PROVISIONS OF THE RESTRICTED STOCK UNIT AWARD AGREEMENT
AND THE STOCKHOLDERS AGREEMENT AMONG THE COMPANY AND ITS STOCKHOLDERS.  A COPY OF THE ABOVE REFERENCED AGREEMENTS
ARE ON FILE AT THE PRINCIPAL OFFICES OF THE COMPANY.

 

7.                           Purchase for Investment;
Other Representations of Executive; Legends.

 

(a)                                  Investment
Intent.  Prior to delivery of any
stock certificate evidencing Restricted Stock, Executive will be required to
represent that such Restricted Stock is being acquired for investment and not
with a view to distribution thereof, and to make such other reasonable and
customary representations regarding matters relevant to compliance with
applicable securities laws as are deemed necessary by counsel to the
Parent.  Stock certificates evidencing
Restricted Stock that are delivered hereunder shall bear restrictive legends in
substantially the following form and such other restrictive legends as are
required or advisable under the provisions of any applicable laws or are
provided for in any other agreement to which Executive is a party:

 

THE SHARES REPRESENTED BY THIS STOCK CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND SHALL NOT BE

 

4

 

TRANSFERRED EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT,
OR (II) AN EXEMPTION FROM REGISTRATION UNDER SAID ACT.

 

(b)                                 Other
Representations.  Executive hereby
represents and warrants to the Parent and the Company as follows:

 

(i)                                     Access
to Information.  Because of
Executive’s business relationship with the Parent and the Company and with the
management of the Parent and the Company, Executive has had access to all
material and relevant information concerning the Parent and the Company,
thereby enabling Executive to make an informed investment decision with respect
to his investment in the Parent and the Company, and all pertinent data and
information requested by Executive from the Parent and the Company or its
representatives concerning the business and financial condition of the Parent
and the Company and the terms and conditions of this Agreement have been
furnished to Executive.  Executive
acknowledges that Executive has had the opportunity to ask questions of and
receive answers and obtain additional information from the Parent and the
Company and its representatives concerning the present and proposed business
and financial conditions of the Parent and the Company.

 

(ii)                                  Financial
Sophistication.  Executive has such
knowledge and experience in financial and business matters that Executive is
capable of evaluating the merits and risks of investing in the Restricted
Stock.

 

(iii)                               Understanding
the Investment Risks.  Executive
understands that:

 

A.                                   An
investment in the Restricted Stock represents a highly speculative investment,
and there can be no assurance as to the success of the Parent or the Company in
its business; and

 

B.                                     There
is at present no market for the Restricted Stock and there can be no assurance
that a market will develop in the future.

 

(iv)                              Understanding
of the Nature of the Restricted Stock. 
Executive understands and agrees that:

 

A.                                   There
can be no assurance that the Restricted Stock will be registered under the
Securities Act of 1933, as amended (the “Securities Act”) or any applicable
state securities laws and if they are not so registered, they will only be
issued and sold in reliance upon certain exemptions contained in the Securities
Act and applicable state securities laws, and the representations and
warranties of Executive contained herein, which are required to be renewed as
to the Restricted Stock at the times of delivery of stock certificates
evidencing the Restricted Stock, are essential to any claim of exemption by the
Parent or the Company under the Securities Act and such state laws;

 

B.                                     If
the Restricted Stock is not so registered, the Restricted Stock will be
“restricted securities” as that term is defined in Rule 144 promulgated under
the Securities Act;

 

5

 

C.                                     Executive
may not sell or transfer the Restricted Stock without registration under the
Securities Act and applicable state securities laws unless Parent receives an
opinion of counsel acceptable to it (as to both counsel and the opinion) that
such registration is not required;

 

D.                                    Only
Parent can register the Restricted Stock under the Securities Act and
applicable state securities laws;

 

E.                                      Neither
the Company nor the Parent has made any representations to Executive that
Parent will register the Restricted Stock under the Securities Act or any
applicable state securities laws, or with respect to compliance with any
exemption therefrom;

 

F.                                      Executive
is aware of the conditions for Executive’s obtaining an exemption for the sale
or transfer of the Restricted Stock under the Securities Act and any applicable
state securities laws; and

 

G.                                     Parent
and the Company may, from time to time, make stop transfer notations in its
transfer record to ensure compliance with the Securities Act and any applicable
state securities laws, and any additional restrictions imposed by state
securities administrators.

 

(v)                                 Investment
Intent.  Executive acknowledges
that:

 

A.                                   Executive
is acquiring the Restricted Stock Units and Restricted Stock for Executive’s
own account and not on behalf of any other person;

 

B.                                     Executive
is acquiring the Restricted Stock Units and Restricted Stock for investment and
not with a view to distribution or with the intent to divide Executive’s
participation with others or, sell or otherwise distribute the Restricted Stock
Units or the Restricted Stock;

 

C.                                     Neither
Executive nor anyone acting on Executive’s behalf has paid or will pay a
commission or other remuneration to any person in connection with the
acquisition of the Restricted Stock Units or the Restricted Stock; and

 

D.                                    At
the time and as a condition of delivery of stock certificates evidencing the
Restricted Stock, Executive will be deemed to have made all the representations
and warranties contained in this Section 7 with respect to such Restricted
Stock and may be required to make other representations concerning investment
intent as a condition of the delivery of such Restricted Stock by the Parent.

 

8.                           Rights on Termination of
Employment.

 

(a)                                  Termination
Without Cause or for Good Reason.

 

(i)                                     If
Executive’s employment with the Company is terminated by Executive for Good
Reason or by the Company without Cause, in each case prior to the third

 

6

 

anniversary of the Effective Date, the Parent shall have the right (but
not the obligation) to purchase all or any portion of Executive’s Restricted
Stock from Executive for an amount equal to the number of shares of such
Restricted Stock multiplied by the Fair Market Value of each such share of
Restricted Stock with respect to the date of exercise of such right.  The Parent’s said right may be exercised at
any time or from time to time (A) with respect to Purchased Shares, during the
90-day period commencing on the date of such termination and (B) with respect
to shares of Restricted Stock in respect of Restricted Stock Units, during the
90-day period commencing on the date which is six months following the date on
which stock certificates representing such shares of Restricted Stock are
delivered to Executive pursuant to Section 6.

 

(ii)                                  If
Executive’s employment with the Company is terminated by Executive for Good
Reason or by the Company without Cause, in each case prior to the third
anniversary of the Effective Date, Executive shall have the right (but not the
obligation) to require the Parent to purchase (the “Put Right”) all of
Executive’s Restricted Stock not purchased by the Parent pursuant to
Section 8(a)(i) for an amount equal to the number of shares of such Restricted
Stock multiplied by the Fair Market Value of each such share with respect to
the date of the exercise of such Put Right. 
Executive’s Put Right with respect to the Restricted Stock may be
exercised at any time or from time to time (A) with respect to Purchased
Shares, during the 90-day period commencing on the date of such termination and
(B) with respect to shares of Restricted Stock in respect of Restricted Stock
Units, during the 90-day period commencing on the date which is six months
following the date on which stock certificates representing such shares of
Restricted Stock are delivered to Executive pursuant to Section 6.

 

(b)                                 Termination
For Cause, Without Good Reason or Upon End of Term.

 

(i)                                     If
Executive’s employment with the Company is terminated by Executive without Good
Reason or by the Company with Cause, in each case prior to the third
anniversary of the Effective Date, or Executive’s employment is terminated by
Executive or the Company for any reason after the date which is the third anniversary
of the Effective Date, the Parent shall have the right (but not the obligation)
to purchase all or any portion of Executive’s Restricted Stock for an amount
equal to the number of shares of such Restricted Stock multiplied by the Fair
Market Value of each such share with respect to the date of exercise of such
right.  The Parent’s said right may be
exercised at any time or from time to time (A) with respect to Purchased
Shares, during the 90-day period commencing on the date of such termination and
(B) with respect to shares of Restricted Stock in respect of Restricted Stock
Units, during the 90-day period commencing on the date which is six months
following the date on which stock certificates representing such shares of
Restricted Stock are delivered to Executive pursuant to Section 6.

 

(ii)                                  If
a KPS Exit occurs following a termination referred to in Section 8(b)(i),
Executive shall have a Put Right with respect to Executive’s Restricted Stock
not purchased by the Parent pursuant to Section 8(b)(i) for an amount
equal to the number of such shares of Restricted Stock multiplied by the Fair
Market Value of each such share with respect to the date of the KPS Exit.  Executive’s Put Right may be exercised at
any time or from time to time (A) with respect to Purchased Shares, during the
90-day period commencing on the date of

 

7

 

such KPS Exit
and (B) with respect to shares of Restricted Stock in respect of Restricted
Stock Units, during the 90-day period commencing on the date which is six
months following the date on which stock certificates representing such shares
of Restricted Stock are delivered to Executive pursuant to Section 6.

 

(c)                                  Death
and Disability.

 

(i)                                     If
Executive’s employment with the Company is terminated as a result of the death
or Disability of Executive, the Parent shall have the right (but not the
obligation) to purchase all or any portion of Executive’s Restricted Stock from
Executive (or, if applicable, his estate or the person then acting on
Executive’s behalf) for an amount equal to the number of shares of such
Restricted Stock multiplied by the Fair Market Value of each such share with
respect to the date of exercise of such right. 
The Parent’s said right may be exercised at any time or from time to
time (A) with respect to Purchased Shares, during the 90-day period commencing
on the date of such termination and (B) with respect to shares of Restricted
Stock in respect of Restricted Stock Units, during the 90-day period commencing
on the date which is six months following the date on which stock certificates
representing such shares of Restricted Stock are delivered to Executive
pursuant to Section 6.

 

(ii)                                  Upon
such a termination referred to in Section 8(c)(i), Executive (or, if
applicable, his estate or the person then acting on Executive’s behalf) shall
have a Put Right with respect to Executive’s Restricted Stock not purchased
pursuant to 8(c)(i) for an amount equal to the number of shares of such
Restricted Stock multiplied by the Fair Market Value of each such share with
respect to the date of exercise of such Put Right.  Executive’s Put Right may be exercised at any time or from time
to time (A) with respect to Purchased Shares, during the 365-day period
commencing on the date of such termination and (B) with respect to shares of
Restricted Stock in respect of Restricted Stock Units, during the 365-day
period commencing on the date which is six months following the date on which
stock certificates representing such shares of Restricted Stock are delivered
to Executive pursuant to Section 6.

 

(d)                                 Additional
Rights.

 

(i)                                     Subject
to the Parent’s financing agreements, if Executive exercises any Put Right
described in Section 8(a), (b) or (c) above, the Parent or the Company
shall pay to him within one year following the date of the exercise of such Put
Right the purchase price of the Restricted Stock being purchased by the Parent
pursuant to such Put Right with interest from the date of exercise of such Put
Right at the Federal Short-Term Interest Rate in effect on the first day of the
month of such exercise, to be recalculated on the first day of each month
thereafter until all payments are made. 
If the Parent is unable to pay Executive for the Restricted Stock in
accordance with the preceding sentence as a result of any covenant in any of
its financing agreements, the Parent shall pay Executive for such Restricted
Stock as soon as possible under such financing agreements, with interest at the
Federal Short-Term Interest Rate in effect on the first day of the month of
termination to be recalculated on the first day of each month thereafter until
all payments are made, or at the option of Executive, exercise of the Put Right
may be rescinded by Executive and the Restricted Stock returned to Executive.

 

8

 

(ii)                                  If
there has not been a KPS Exit prior to December 31, 2004, Executive will
have a Put Right during the ninety (90) day period following December 31,
2004 with respect to any Purchased Shares. 
If there has not been a KPS Exit prior to December 31, 2006,
Executive will have a Put Right during the ninety (90) day period following
December 31, 2006 with respect to any shares of Restricted Stock in
respect of Restricted Stock Units, share certificates for which he has then
held for a period of not less than six months. 
If there has been a KPS Exit prior to December 31, 2006 in
connection with which Executive is not permitted to sell all of his Restricted
Stock, Executive will have a Put Right during the ninety (90) day period
following December 31, 2006 with respect to any shares of Restricted
Stock, share certificates for which he has then held for a period of not less
than six months.  The purchase price of
such Restricted Stock will be the Fair Market Value of such Restricted Stock as
of the date of exercise of the applicable Put Right and will be paid in equal
annual installments by Parent upon each of the first four (4) anniversaries of
the date of the exercise of such Put Right, earning interest at the Federal
Short-Term Interest Rate.

 

(iii)                               Executive
shall have no Put Rights under this Agreement with respect to Restricted Stock
at any time that the Common Stock is (i) publicly traded,
(ii) registered pursuant to the Securities Act and (iii) transferable
by the Executive, subject to normal securities law restrictions applicable to
trading of registered securities by an executive officer of an issuer or
reasonable restrictions imposed on such transfers by an underwriter of such
stock.

 

(iv)                              Any
Put Right under this Agreement with respect to the Restricted Stock will be
necessarily subject to those conditions imposed by the Parent and the Company’s
financing documents or other contract to which the Parent or the Company is a
party or by applicable law; provided, however, that Parent will use its
reasonable efforts to purchase and pay for any Restricted Stock put to Parent
by Executive on a pari passu basis with any other shares put to Parent by any
employee or officer of Parent or of the Company to the extent that any such
purchase is permitted under such financing documents, contracts or laws; provided
further that any shares held by the ESOP (including for the account of
Executive) shall have a priority with respect to such purchases.

 

(v)                                 If
Parent shall exercise any right to purchase any Restricted Stock of Executive
pursuant to this Section 8, Parent or the Company shall pay to Executive
(or his estate) the full amount of the purchase price therefor on the date of
exercise of such right.  The amount of
such payment on the date of exercise of such right (the “Preliminary Payment”)
shall be calculated using the Fair Market Value of each share determined
pursuant to Section 2(e)(i); provided, however, that if such
exercise occurs other than in the first six months of the calendar year, the
purchase price for purposes of this Section 8(d)(iv) shall be recalculated
using the Fair Market Value of each share determined pursuant to
Section 2(e)(ii) and, if such recalculated purchase price (the “Recalculated
Price”) exceeds the Preliminary Payment, Parent or the Company shall pay to
Executive the amount of such excess as promptly as possible following the
determination of the Recalculated Price with interest from the date of exercise
of such purchase right at the Federal Short-Term Interest Rate; and if the
Recalculated Price is less than the Preliminary Payment, Executive shall pay to
Parent or the Company, as applicable, the amount of such difference as promptly
as possible following the determination of the

 

9

 

Recalculated
Price with interest from the date of exercise of such purchase right at the
Federal Short-Term Interest Rate.

 

9.                           Miscellaneous.

 

(a)                                  Notices.  All notices or other communications required
or permitted hereunder shall be in writing and shall be delivered personally or
by reputable commercial messenger service, telecopied, or sent by certified,
registered or express mail, postage prepaid. 
Any such notice shall be deemed given when so delivered personally or by
such messenger service or so telecopied or, if sent by certified, registered or
express mail, five days after the date of deposit in the United States mail, as
follows:

 

	
  (i)     if
  to the Parent or the Company:

  
	
   

  
	
   

  	
  Blue Ridge Paper Products Inc.

  
	
   

  	
  1 West Pack Square, Suite 1100

  
	
   

  	
  Asheville, North Carolina 28801

  
	
   

  	
  Attention: President

  
	
   

  	
  Telecopy: (828) 254-6461

  
	
   

  	
   

  
	
   

  	
  and with a copy to:

  
	
   

  	
   

  
	
   

  	
  Paul, Weiss, Rifkind, Wharton & Garrison

  
	
   

  	
  1285 Avenue of the Americas

  
	
   

  	
  New York, New York 10019-6064

  
	
   

  	
  Attention:  Robert C. Fleder,
  Esq.

  
	
   

  	
  Telecopy: (212) 373-2296

  
	
   

  
	
  (ii)     if
  to Executive:

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [Address]

  
	
   

  	
  [Address]

  

 

Any party may, by notice given in accordance with this
Section 9(a), designate another address or person for receipt of notices
hereunder.

 

(b)                                 Arbitration.

 

(i)                                     Notwithstanding
any other provision of this Agreement to the contrary, any disputes hereunder
relating to this Agreement shall be settled exclusively by arbitration
conducted in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, as more particularly described in this
Section 9(b) (the “Arbitration Rules”). 
Any arbitration shall be governed by the United States Arbitration Act,
9 U.S.C. Sections 1-16, and (notwithstanding anything herein to the contrary)
judgment upon the award rendered by the Arbitrator may be entered by any court
having competent jurisdiction.  The
place of the arbitration shall be Charlotte, North Carolina.

 

10

 

(ii)                                  There
will be one neutral arbitrator (the “Arbitrator”) who will be a practicing
attorney and will be selected by mutual agreement of the parties to the
arbitration and, in the absence of such agreement, will be chosen by the
American Arbitration Association or, if it is not then in existence, by any
other reputable dispute resolution firm agreed to by the parties.

 

(iii)                               The
parties intend that the Arbitrator shall resolve any dispute arising hereunder
based upon the language of this Agreement and the applicable rules of contract
interpretation.  All awards and orders
of the Arbitrator may be enforced by any court of competent jurisdiction.

 

(iv)                              The
parties intend that any arbitration proceeding be conducted as expeditiously as
possible and that appropriate rights of discovery be granted to each party to
such arbitration (as determined by the Arbitrator).  In that regard, the parties to such arbitration agree to work
together in good faith to arrive upon mutually acceptable procedures regarding
the time limits for, and nature and extent of, such rights of discovery and the
periods of time within which the matters submitted to arbitration must be heard
and determined by the Arbitrator.  If
the parties to such arbitration are unable to so agree, such issues will be
submitted to the Arbitrator for determination. 
If proper notice of any hearing has been given, the Arbitrator will have
full power to proceed to take evidence or to perform any other acts necessary
to arbitrate the matter in the absence of any party who fails to appear.  The Arbitrator, attorneys, parties to the
arbitration, witnesses, experts, court reporters, or other persons present at
the arbitration shall agree in writing to maintain the strict confidentiality
of the arbitration proceedings.

 

(v)                                 The
parties to any arbitration, by written stipulation, may expand or reduce the
rights, duties or obligations provided above, or otherwise modify the
arbitration procedures to suit their convenience, consistent with what is
otherwise permitted and feasible within the framework of the Arbitration Rules.

 

(vi)                              Any
decision or award of the Arbitrator shall be final and binding upon the parties
to the arbitration proceeding, except to the extent otherwise expressly
provided by North Carolina law.  The
parties hereto hereby waive to the extent permitted by law any rights to appeal
or to a review of such award by any court or tribunal.  The parties agree that the award of the
Arbitrator may be enforced against the parties to the proceeding or their assets
wherever they may be found.

 

(vii)                           At any
time during the arbitration proceedings specified in this Section 9(b) a
party may seek a preliminary injunction or other provisional judicial relief if
in its judgment such action is necessary to avoid irreparable damage or to
preserve the status quo.  Despite such
action, the parties will continue to participate in good faith in the
arbitration proceedings specified in this Section 9(b).  All passage of time shall be tolled for
purposes of any applicable statute of limitations or the equitable doctrine of
laches while the arbitration proceedings specified in this Section 9(b)
are pending.  The parties will take such
action, if any, as is required to effectuate such tolling.

 

11

 

(viii)                        All costs
and fees associated with any arbitration conducted pursuant to this
Section 9(b) shall initially be paid by each party thereto.  At the conclusion of any arbitration under
this Agreement, however, the Arbitrator shall award to the prevailing party all
costs and fees associated with such arbitration, including, without limitation,
the prevailing party’s actual and reasonable attorneys’ fees and all Arbitrator
fees.

 

10.                     Binding Effect.  This Agreement shall be binding upon the
heirs, executors, administrators and successors and assigns of the parties
hereto.

 

11.                     Governing Law.  This Agreement shall be governed by, and
construed and interpreted in accordance with, the laws of the State of North
Carolina without reference to principles of conflict of laws.

 

12.                     Headings.  Headings used herein are for convenience of
reference only, do not constitute a part of this Agreement and shall not be
deemed to limit or affect any of the provisions hereof.

 

13.                     Severability.  To the extent any portion of this Agreement
or any portion of any provision of this Agreement is held to be invalid, void
or unenforceable by a court of competent jurisdiction, such court shall
substitute a valid, enforceable provision that preserves, to the maximum lawful
extent, the terms and intent of this Agreement.

 

14.                     Withholding.  Upon the delivery of any stock certificates
evidencing shares of Restricted Stock to the Executive pursuant to
Section 6, Executive may satisfy the amount of any income tax withholding
required by law (and Parent shall timely remit such amount to the relevant
taxing authorities) by either of the following methods, or by a combination of
such methods: (a) tendering a cash payment to the Parent or (b) delivering to
the Company previously acquired shares of Restricted Stock or having the Parent
withhold stock certificates for shares of Restricted Stock otherwise then
deliverable to Executive having an aggregate fair market value (determined in
good faith by the Board) equal to the amount of such withholding
obligation.  The satisfaction of such
withholding obligation shall be a condition precedent to the delivery to
Executive of stock certificates in accordance with Section 6.

 

15.                     Adjustment to Restricted Stock
and/or Restricted Stock Units.  If
there shall be any change in the outstanding shares of Common Stock or
Preferred Stock by reason of any stock split, stock dividend, merger,
consolidation, combination or exchange of shares for other securities,
recapitalization, or similar corporate change, then the number of Restricted
Stock Units or shares of Restricted Stock, as the case may be, referred to
herein or in the Subscription Agreement, shall be automatically and
appropriately adjusted to give effect to such change.

 

16.                     Third-Party Beneficiary.  There are no beneficiaries to this Agreement
other than the signatories hereto.

 

12

 

17.                     Inconsistent Agreement.  To the extent that any provision of this
Agreement is inconsistent with the Stockholders’ Agreement, the terms of this
Agreement shall govern.

 

EXECUTED on the day and year first written above.

 

 

	
   

  	
  BLUE RIDGE
  PAPER PRODUCTS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BLUE RIDGE
  HOLDING CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [Name]

  
						

 

13

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00064-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00064-of-00352.parquet"}]]