Common use of Alternative Arrangement Clause in Contracts

Alternative Arrangement. If the Conditions shall have been satisfied but Objection Notices in respect of more than three Group A Leases shall have been received by any of the parties hereto prior to the Effective Date, then (x) Borders and BGI shall exercise their reasonable best efforts (without the payment of money other than for their own overhead and for the fees of their own counsel, advisors, representatives and other third party service providers representing BGI or Borders) to cause each landlord who issued an Objection Notice to withdraw its Objection Notice by offering to provide such landlord a guaranty from BGI of the tenant's obligations under such landlord's Group A Lease and by taking such other actions as Borders or BGI shall determine in their sole discretion to be appropriate, and (y) if, despite such efforts described in clause (x), there shall remain more than three Group A Leases in respect of which Objection Notices are outstanding on the date which is 90 days after the Effective Date, then BGI or Borders shall provide Kmart an Acceptable Letter of Credit (as defined below) as security for the obligation of Borders and BGI under Section 2 of the LGIRA to indemnify Kmart for any payments Kmart makes under any of the Guaranties. An "Acceptable Letter of Credit" shall be a letter of credit which: (i) is issued by a national bank; (ii) has a face amount equal to the lesser of (A) $3 million and (B) the product of (x) Six Hundred Seven Thousand Four Hundred Thirty-Five Dollars ($607,435) multiplied by (y) the number of Group A Leases in excess of three in respect of which Objection Notices remain outstanding at the expiration of the aforesaid 90 day period commencing on the Effective Date; (iii) shall be renewed annually for five years following the Effective Date; and (iv) is otherwise in form and substance reasonably acceptable to Kmart.

Alternative Arrangement. (a) If the Conditions shall have been satisfied but Objection Notices in respect of more than three Group A Leases shall have been received by any of the parties hereto you wish to accept other employment prior to the Effective Date, then (x) Borders and BGI shall exercise their reasonable best efforts (without you may do so subject to the payment of money other than for their own overhead and for Company having confirmed to you in writing that your prospective employer is not engaged directly or indirectly in any activity which is competitive with the fees of their own counsel, advisors, representatives and other third party service providers representing BGI or Borders) to cause each landlord who issued an Objection Notice to withdraw its Objection Notice by offering to provide such landlord a guaranty from BGI business of the tenant's obligations under Company or any of its subsidiaries (such landlord's Group A Lease an employer, a “Competitor”). If any employer with which you accept employment becomes a Competitor after you begin your employment and by taking prior to the Effective Date, upon the Company’s notice to you, you will terminate your employment with such other actions as Borders or BGI shall determine in their sole discretion to be appropriate, and (y) if, despite such efforts described in clause (x), there shall remain more than three Group A Leases in respect of which Objection Notices are outstanding on the date which is 90 days employer until after the Effective Date. ▇▇▇▇▇▇ ▇▇▇▇▇▇, p. 5 (b) Beginning on the date on which you commence any employment pursuant to Section 11(a) above (“New Employment Date”), your Term of Employment will terminate and you will cease to be an employee of the Company. As a result: (i) your rights to the payments and benefits under Section 3 hereof will cease as of the New Employment Date, provided, however, that if the New Employment Date occurs prior to May 15, 2007, you nonetheless will receive the single cash lump sums representing delayed Base Salary, car allowance and housing allowance payments on May 15, 2007 in accordance with Sections 3(b)(i), 3(b)(iv) and 3(b)(v), and the 2006 Bonus Payment in accordance with Section 3(b)(ii); (ii) subject to Section 13 hereof, any stock options held by you which have not yet become exercisable in accordance with their terms prior to the business day immediately preceding the New Employment Date will vest fully and become fully exercisable on such date and any outstanding unexercised stock options will expire at the close of business on the later of December 31 of the year in which the New Employment Date occurs or the 15th day of the third month following the New Employment Date; provided, however, that if the final rules promulgated under Section 409A of the Internal Revenue Code of 1986, as amended, provide that the extension of the exercisability of a stock option following termination of employment is not a modification of such stock option, then BGI such stock options will expire on the latest date permitted under their respective grant agreements; (iii) subject to Section 13 hereof, any restricted stock units awarded to you by the Company which have not yet become fully vested and been settled in accordance with their terms prior to the business day immediately preceding the New Employment Date will continue to vest and be settled in accordance with their terms as if you had remained continuously employed with the Company through such vesting dates; (iv) your continued participation in any plans, programs or Borders shall provide Kmart arrangements of the Company, unless otherwise specifically provided for in this Letter Agreement, will cease as of the New Employment Date and your rights thereunder will be governed by the terms of such plans, programs or arrangements; and (v) from the New Employment Date until the Effective Date, you will be entitled to receive from the Company an Acceptable Letter amount equal to 50% of Credit your Base Salary (as defined belowand determined in accordance with Section 3(a) as security for the obligation of Borders and BGI under Section 2 of the LGIRA Agreement), payable monthly, and, in addition to indemnify Kmart for any payments Kmart makes under any of your existing entitlement to the Guaranties. An "Acceptable Letter of Credit" shall be a letter of credit which: (i) is issued by a national bank; (ii) has a face 2006 Bonus Payment,an amount equal to 50% of your Bonus Compensation (as defined and determined in accordance with Section 3(b) of the lesser Agreement; provided that if the Company performance metrics are altered after the date hereof, your Bonus Compensation will be determined by reference to the same Company performance metrics used to determine the Bonus Compensation of (Athe Chief Executive Officer) $3 million and (B) the product of (x) Six Hundred Seven Thousand Four Hundred Thirty-Five Dollars ($607,435) multiplied by (y) the number of Group A Leases in excess of three in respect of which Objection Notices remain outstanding payable at the expiration same time as bonuses to other senior executives. Accordingly, the maximum amount of Bonus Compensation to which you will be entitled after you commence other employment will be 56.25% of your Base Salary (i.e., one-half of 112.5% of your Base Salary) for a full fiscal year, and a pro rata portion thereof if the aforesaid 90 day period commencing on the Effective Date; (iii) shall be renewed annually for five years following the Effective Date; and (iv) in question is otherwise in form and substance reasonably acceptable to Kmart.less than a full fiscal year. ▇▇▇▇▇▇ ▇▇▇▇▇▇, p. 6