Common use of Cancellation of Company Options Clause in Contracts

Cancellation of Company Options. (a) The Board of Directors of Company has adopted resolutions to the effect that each outstanding Company Option held by each holder of a Company Option (each, an “Optionholder” and, collectively, the “Optionholders”) shall become exercisable in full. Not less than three Business Days prior to Closing, each Optionholder shall either exercise its Company Options by paying the cash exercise thereof or, as to any Company Options not so exercised, enter into an option surrender and cancellation agreement (the “Option Surrender Agreement”) pursuant to which such Optionholder shall agree (i) to cancel and exchange such Company Options for shares of Company Common Stock pursuant to Section 2.4(c) below and (ii) to sell, transfer and assign such shares of Company Common Stock to Purchaser at Closing in accordance with the terms and conditions of this Agreement. (b) Section 2.4(b) of the Disclosure Schedule sets forth, as of the date hereof, the name of each Optionholder, the number of shares of Company Common Stock issuable upon the exercise of each Company Option held by such Optionholder, and the per share exercise price of each such Company Option. At least three Business Days prior to Closing, Sellers’ Representative shall deliver to Purchaser a revised Section 2.4(b) of the Disclosure Schedule identifying those Optionholders who, since the date of this Agreement, have exercised Company Options or have entered into an Option Surrender Agreement to cancel and exchange Company Options for shares of Company Common Stock pursuant to Section 2.4(c) hereof (such electing Optionholders are referred to herein as the “Exchange Optionholders” and the Company Options subject to such election are referred to herein as the “Exchanged Options”), together with executed copies of the Option Surrender Agreements. (c) Not less than three Business Days prior to Closing, each Exchange Optionholder who has entered into an Option Surrender Agreement shall receive from Company, in cancellation and exchange for its Exchanged Options and in accordance with the terms and conditions of the Option Surrender Agreement, a number of shares of Company Common Stock equal to the quotient obtained by dividing (i) the Exchanged Options Value (as defined below) by (ii) the Per Share Purchase Price. “Exchanged Options Value” shall mean (i) the aggregate number of shares of Company Common Stock issuable upon exercise in full of the Exchanged Options multiplied by (ii) (A) the Per Share Purchase Price minus (B) the average exercise price per share of the Exchanged Options.

Cancellation of Company Options. (a) The Upon the terms and subject to the conditions set forth herein, the Board of Directors of the Company has adopted shall adopt resolutions to the effect that that, and the Company will take such other action as shall be necessary such that, each outstanding Company Option held by shall become exercisable in full immediately prior to the Effective Time and, at the Effective Time, shall be cancelled, retired and extinguished and upon the cancellation thereof, each holder of a Company Option (each, an “Optionholder” and, collectively, the “Optionholders”"OPTIONHOLDER") shall become exercisable in full. Not less than three Business Days prior exchange any rights with respect thereto, for the right to Closing, each Optionholder shall either exercise its Company Options by paying receive the cash exercise thereof or, Option Purchase Price (as to any Company Options not so exercised, enter into an option surrender hereinafter defined) and cancellation agreement (the “Option Surrender Agreement”) Parent Warrants payable and issuable with respect thereto pursuant to which such Optionholder shall agree (i) to cancel and exchange such Company Options for shares of Company Common Stock pursuant to Section 2.4(c) below and (ii) to sell, transfer and assign such shares of Company Common Stock to Purchaser at Closing in accordance with the terms and conditions of this AgreementSECTION 2.7(b). (b) Section 2.4(b) Subject to SECTION 2.9, as consideration in exchange for all Company Options pursuant to SECTION 2.7(a), the Company shall, after the Effective Time, upon surrender to the Company of the Disclosure Schedule sets forthapplicable Option Agreement for cancellation (or if the Optionholder does not surrender such Option Agreement, as delivery by the Optionholder of such other documentation reasonably acceptable to the Company and Parent evidencing the Optionholders' agreement to cancel his or her Company Option in respect of the date hereof, the name of each Optionholder, the number of shares of Company Common Stock issuable upon the exercise of each Company Option held by such Optionholder, and the per share exercise price of each such Company Option. At least three Business Days prior consideration to Closing, Sellers’ Representative shall deliver to Purchaser a revised Section 2.4(b) of the Disclosure Schedule identifying those Optionholders who, since the date of this Agreement, have exercised Company Options or have entered into an Option Surrender Agreement to cancel and exchange Company Options for shares of Company Common Stock be paid pursuant to Section 2.4(c) hereof (such electing Optionholders are referred to herein as the “Exchange Optionholders” and the Company Options subject to such election are referred to herein as the “Exchanged Options”), together with executed copies of the Option Surrender Agreements.this SECTION 2.7): (ci) Not less than three Business Days prior to Closing, pay each Exchange Optionholder who has entered into an Option Surrender Agreement shall receive from Company, amount in cancellation and exchange for its Exchanged Options and in accordance with the terms and conditions of the Option Surrender Agreement, a number of shares of Company Common Stock cash equal to the quotient product obtained by dividing multiplying (i) the Exchanged Options Value (as defined below) by (ii) the Per Share Purchase Price. “Exchanged Options Value” shall mean (ix) the aggregate number of shares of Company Common Stock issuable upon the exercise in full of the Exchanged Options multiplied each Company Option held by such Optionholder by (iiy) the difference of (A) the Per Share Purchase Price minus Cash Merger Consideration less (B) the average exercise price per share of each such Company Option; and (ii) issue each Optionholder Parent Warrants to purchase that number of shares of Parent Common Stock (rounded to the Exchanged Options.nearest whole number) equal to such Optionholder's pro rata share of 300,000 (based on the aggregate amount of cash paid to all

Cancellation of Company Options. (a) The Board At the Closing, by virtue of Directors the Closing and without any action on the part of the Company has adopted resolutions to the effect that or any Option Holder, each outstanding Company Option held by shall be cancelled and each holder of a Option Holder shall have the right to receive from the Company Option in exchange for such cancellation the following (each, each an “Optionholder” andOption Cancellation Payment”), collectively, and the “Optionholders”) Option Plan shall become exercisable in full. Not less than three Business Days prior to Closing, each Optionholder shall either exercise its Company Options by paying the cash exercise thereof or, as to any Company Options not so exercised, enter into an option surrender and cancellation agreement (the “Option Surrender Agreement”) pursuant to which such Optionholder shall agree be terminated: (i) an amount equal to cancel (A) such Option Holder’s Allocable Portion of the sum of (x) the balance of the Estimated Purchase Price as contemplated by Section 2.2(c)(vii) and exchange such (y) the aggregate Exercise Price of all Company Options assuming exercise thereof immediately prior to the Closing Date; minus (B) the full amount (not the Allocable Portion) of the aggregate Exercise Price for shares of Company Common Stock pursuant to Section 2.4(c) below and (ii) to sellsuch Option Holder’s Options, transfer and assign such shares of Company Common Stock to Purchaser which shall be paid at the Closing in accordance with Section 2.5(b); (ii) such Option Holder’s Allocable Portion of any applicable adjustments pursuant to Section 2.4(f), which shall be paid in accordance with Section 2.4(f); (iii) such Option Holder’s Allocable Portion of the terms Escrow Funds, if any, available for distribution to Sellers pursuant to the Escrow Agreement, which shall be paid in accordance with the Escrow Agreement and conditions of this Agreement; (iv) such Option Holder’s Allocable Portion of the Reserve Account, if any, available for distribution by Sellers’ Representative to Sellers pursuant to Section 10.4; and (v) such Option Holder’s Allocable Portion of any applicable payments pursuant to Section 6.11(c), which shall be paid in accordance with Section 6.11(c). (b) Section 2.4(b) of To the Disclosure Schedule sets forthextent not previously paid, as of Buyer shall cause the date hereof, Company to pay to each Option Holder at the name of each Optionholder, the number of shares of Company Common Stock issuable upon the exercise of each Company Closing such Option held by such Optionholder, and the per share exercise price of each such Company Option. At least three Business Days prior to Closing, Sellers’ Representative shall deliver to Purchaser a revised Section 2.4(b) of the Disclosure Schedule identifying those Optionholders who, since the date of this Agreement, have exercised Company Options or have entered into an Holder’s Option Surrender Agreement to cancel and exchange Company Options for shares of Company Common Stock Cancellation Payment made pursuant to Section 2.4(c2.5(a)(i) hereof (such electing Optionholders are referred in a single lump sum through the Company’s payroll system and deduct and withhold, or cause to herein as the “Exchange Optionholders” and the Company Options subject to such election are referred to herein as the “Exchanged Options”)be deducted or withheld, together with executed copies from any portion of the Option Surrender Agreements. Cancellation Payment made hereunder, such amounts as are required to be deducted and withheld under the Code, or any provision of applicable U.S. federal, state, local or foreign Tax Laws, including the employee’s share of FICA Taxes and any applicable state, local or foreign payroll Taxes normally imposed on an employee with respect to compensation (c) Not less than three Business Days prior but excluding any employer’s share). To the extent that such amounts are so deducted and withheld, such deducted and withheld amounts shall be treated for all purposes of this Agreement as having been paid to Closing, each Exchange Optionholder who has entered into an Option Surrender Agreement shall receive from Company, in cancellation and exchange for its Exchanged Options and in accordance with the terms and conditions of the Option Surrender Agreement, a number Holders in respect of shares of Company Common Stock equal to the quotient obtained by dividing (i) the Exchanged Options Value (as defined below) by (ii) the Per Share Purchase Price. “Exchanged Options Value” shall mean (i) the aggregate number of shares of Company Common Stock issuable upon exercise in full of the Exchanged Options multiplied by (ii) (A) the Per Share Purchase Price minus (B) the average exercise price per share of the Exchanged Optionswhich such deduction and withholding was made.

Cancellation of Company Options. (a) The Board At the Effective Time, each Company Option shall have all rights thereunder cancelled and each former holder of Directors of Company has adopted resolutions any cancelled In-the-Money Option, in exchange therefor, but only upon delivery to the effect that each outstanding Company of an Option held by each holder of a Company Option Termination Agreement in the form attached hereto as Exhibit D (each, an “Optionholder” andOption Termination Agreement”), collectively, effective upon the “Optionholders”) shall become exercisable in full. Not less than three Business Days prior to Closing, each Optionholder shall either exercise its Company Options by paying the cash exercise thereof or, as be entitled to any Company Options not so exercised, enter into an option surrender and cancellation agreement (the “Option Surrender Agreement”) pursuant to which such Optionholder shall agree (i) an amount in cash, without interest, equal to cancel and exchange such Company Options for shares the product of Company Common Stock pursuant to Section 2.4(c(A) below and the Option Per Share Consideration multiplied by (iiB) to sell, transfer and assign such shares of Company Common Stock to Purchaser at Closing in accordance with the terms and conditions of this Agreement. (b) Section 2.4(b) of the Disclosure Schedule sets forth, as of the date hereof, the name of each Optionholder, the number of shares of Company Common Stock issuable upon subject to such In-the-Money Option and (ii) the exercise of contingent right to receive each Further Distributions Per Share Amount, if any, less any applicable withholding Taxes. Each Company Option held by such Optionholder, and that is not an In-the-Money Option shall be automatically cancelled for no consideration. (b) Prior to the per share exercise price of each such Company Option. At least three Business Days prior to Closing, Sellers’ Representative shall deliver the Company and its board of directors shall, subject to Purchaser a revised Section 2.4(b) applicable Law, take all actions (including, if appropriate, amending any Company Option Plan and individual option agreements and obtaining consents from the holders of the Disclosure Schedule identifying those Optionholders who, since the date of this Agreement, have exercised Company Options or have entered into an Option Surrender Agreement to cancel and exchange Company Options for shares of Company Common Stock pursuant to Section 2.4(c) hereof (such electing Optionholders are referred to herein as the “Exchange Optionholders” and the Company Options subject and/or delivering optionee notices thereto) necessary to such election are referred give effect to herein as the “Exchanged Options”transactions provided for in this Section 1.7 and to ensure that from and after the Effective Time, each holder of an outstanding Company Option shall cease to have any rights with respect thereto, except the right to receive the consideration specified in Section 1.7(a), together with executed copies of the Option Surrender Agreementswithout interest. (c) Not less than Within ten (10) Business Days following the date hereof, the Company shall deliver to each holder of an In-the-Money Option an Option Termination Agreement. Parent shall within three (3) Business Days following the Closing Date, and subject to Parent’s receipt of an Option Termination Agreement duly completed and validly executed in accordance with the instructions provided therein from each holder of an In-the-Money Option, cause the Surviving Corporation to deliver through its payroll system the consideration provided for herein to such holder. No interest shall be paid on any amounts payable upon delivery of any Option Termination Agreement. For each Effective Time Holder of an In-the-Money Option who has delivered an Option Termination Agreement to Parent at least three (3) Business Days prior to Closingthe Closing Date, such Effective Time Holder shall be entitled to receive a payment equal to his, her or its Pro Rata Share of the Accelerable Escrow Deposit from the Surviving Corporation at the same time as payment for his, her or its In-the-Money Option. For each Exchange Optionholder Effective Time Holder of an In-the-Money Option who has entered into delivers an Option Surrender Termination Agreement to Parent later than the third (3rd) Business Day prior to the Closing Date, such Effective Time Holder shall receive from Companybe entitled to receive, in cancellation and exchange for its Exchanged Options and in accordance with upon the terms and conditions later of the date on which such Effective Time Holder delivers an Option Surrender AgreementTermination Agreement to Parent and the date on which such Effective Time Holder is entitled to receive payment for his, a number her or its In-the-Money Option, payment of shares of Company Common Stock an amount equal to the quotient obtained by dividing difference of (i) his, her or its Pro Rata Share of the Exchanged Options Value (as defined below) by Accelerable Escrow Deposit minus (ii) such Effective Time Holder’s Pro Rata Share of (x) any amounts previously released to the Per Share Purchase Price. “Exchanged Options Value” shall mean Parent Indemnitees from the Accelerable Escrow and (iy) the aggregate number of shares of Company Common Stock issuable upon exercise in full of the Exchanged Options multiplied by (ii) (A) the Per Share Purchase Price minus (B) the average exercise price per share of the Exchanged Optionsany Accelerable Escrow Continuing Claims.

Cancellation of Company Options. (a) The Prior to the Closing Date, the Board of Directors of the Company has adopted resolutions may, in its discretion, cause the vesting of any of the outstanding Company Options that have not been exercised as of the Closing Date to be accelerated in full effective immediately prior to the effect that each outstanding Company Option held by each holder of a Company Option (each, an “Optionholder” and, collectively, the “Optionholders”) shall become exercisable in full. Not less than three Business Days prior to Closing, each Optionholder shall either exercise its Company Options by paying contingent upon the cash exercise thereof or, as to any Company Options not so exercised, enter into an option surrender and cancellation agreement (the “Option Surrender Agreement”) pursuant to which such Optionholder shall agree (i) to cancel and exchange such Company Options for shares of Company Common Stock pursuant to Section 2.4(c) below and (ii) to sell, transfer and assign such shares of Company Common Stock to Purchaser at Closing in accordance with the terms and conditions of this AgreementClosing. (b) Section 2.4(b) of Prior to the Disclosure Schedule sets forth, as of the date hereofClosing, the name Company shall notify each Holder of Company Options that all Company Options, whether vested or unvested, that are outstanding immediately prior to the Effective Time shall be cancelled at the Effective Time and that to be eligible to receive any Per Share Consideration, such Holder must execute and deliver to Parent prior to the Closing Date, an Option Cancellation Agreement in such form as attached hereto as Exhibit D (the “Option Cancellation Agreement”). Effective as of, but subject to the Effective Time, each OptionholderCompany Option shall be cancelled and terminated and, in consideration of such cancellation, each Company Vested Option that is not an Out-of-the-Money Company Option and that is outstanding and unexercised immediately prior to the Effective Time, shall be cancelled at the Effective Time and, in consideration of such cancellation, each holder thereof (assuming such Holder enters into an Option Cancellation Agreement), subject to Section 2.9, Section 2.10, Section 2.14, shall be entitled to receive a number of shares of Company Parent Common Stock, rounding such amount down to the nearest whole number, in accordance with the following calculation, as more specifically provided in the Securities Payment Schedule: A P = Parent Common Stock issuable upon to be received by holder A = Average Parent Stock Price as of the exercise of each Company Option held by such OptionholderClosing Date B = the Per Share Consideration, and expressed as a decimal value C = the per share exercise price of each such holder’s respective Company Option. At least three Business Days prior to Closing, Sellers’ Representative shall deliver to Purchaser a revised Section 2.4(b) of Vested Option D = the Disclosure Schedule identifying those Optionholders who, since the date of this Agreement, have exercised Company Options or have entered into an Option Surrender Agreement to cancel and exchange Company Options for shares number of Company Common Stock pursuant to Section 2.4(c) hereof (such electing Optionholders are referred to herein as the “Exchange Optionholders” and the Company Vested Options subject to such election are referred to herein as the “Exchanged Options”), together with executed copies of the Option Surrender Agreementsheld by holder. (c) Not less than three Business Days Contingent on and effective immediately prior to Closingthe Effective Time, each Exchange Optionholder who has entered into an Company Unvested Option Surrender Agreement and each Out-of-the-Money Company Option that is outstanding and unexercised immediately prior to the Effective Time, shall receive from Company, be cancelled at the Effective Time without the payment of cash or issuance of other securities in cancellation and exchange for its Exchanged Options and in accordance with respect thereof. (d) The Company agrees that the terms and conditions Board of Directors of the Option Surrender Agreement, a number of shares of Company Common Stock equal shall adopt such resolutions or take such other actions (including obtaining any required consents) prior to the quotient obtained by dividing (i) Effective Time as may be reasonably required to effect the Exchanged Options Value (as defined below) by (ii) the Per Share Purchase Price. “Exchanged Options Value” shall mean (i) the aggregate number of shares of Company Common Stock issuable upon exercise transactions described in full of the Exchanged Options multiplied by (ii) (A) the Per Share Purchase Price minus (B) the average exercise price per share of the Exchanged Optionsthis Section 2.7.4.

Cancellation of Company Options. (a) The Board of Directors of Company has adopted resolutions Prior to the effect Closing, the administrator of the Company Stock Plan shall have resolved under Section 6.2 of the Company Stock Plan (and each individual option agreement issued pursuant to the Company Stock Plan) to determine that each outstanding the Company Options shall terminate at the Effective Time of the Short-Form Merger. Other than as set forth in this Section 1.2, the Company represents and warrants that it has not made any modifications to the Company Stock Plan or delivered any communications to the Optionholders with respect to any modification of their options arising out of the transactions contemplated by this Agreement. As soon as practicable after the Closing, Parent shall cause the Company to distribute to all Optionholders an Option held by each holder of a Company Option Notice and Cancellation Agreement in the form attached hereto as Exhibit C (each, an “Optionholder” and, collectively, the “Optionholders”) shall become exercisable in full. Not less than three Business Days prior to Closing, each Optionholder shall either exercise its Company Options by paying the cash exercise thereof or, as to any Company Options not so exercised, enter into an option surrender and cancellation agreement (the “Option Surrender Cancellation Agreement”) pursuant and to which take all other necessary and appropriate action to effect the termination of all Company Options (whether vested or unvested) at the Effective Time of the Short-Form Merger, including, but not limited to, the giving of any notice required under any agreements relating to the Company Options. Upon receipt from each Optionholder of an executed Option Cancellation Agreement, Parent shall pay to each such Optionholder shall agree an amount (in cash) of the Total Consideration, less all applicable tax withholding, equal to (A) (i) to cancel and exchange the amount such Optionholder would have received under this Agreement had such Optionholder exercised his, her or its vested Company Options for shares of Company Common Stock pursuant to Section 2.4(c) below and (ii) to sell, transfer and assign such shares of Company Common Stock to Purchaser at Closing in accordance with sold the terms and conditions of this Agreement. (b) Section 2.4(b) of the Disclosure Schedule sets forth, as of the date hereof, the name of each Optionholder, the number of shares of Company Common Stock issuable upon such exercise to Parent at the exercise of each Company Option held by such OptionholderClosing, and minus (ii) the per share aggregate exercise price of each such Company Option. At least three Business Days prior to Closing, Sellers’ Representative shall deliver to Purchaser a revised Section 2.4(b) of for the Disclosure Schedule identifying those Optionholders who, since the date of this Agreement, have exercised Company Options or have entered into an Option Surrender Agreement to cancel and exchange Company Options for shares of Company Common Stock pursuant issuable upon exercise of such Company Options, plus (B) such Optionholder’s Pro Rata Portion of the Escrow Amount, if any, as and when distributed to Section 2.4(cthe Stockholders in accordance with Article VIII (the collective amount of (A) hereof and (such electing Optionholders are B) shall be referred to herein as the “Exchange Optionholders” and the Company Options subject to such election are referred to herein as the “Exchanged OptionsOptionholder Consideration”), together with executed copies . The Option Cancellation Agreements shall set forth for each Optionholder such Optionholder’s portion of the Option Surrender AgreementsOptionholder Consideration as reduced by the Escrow Amount (as set forth on the Consideration Allocation and Mechanics Schedule). (cb) Not less than three Business Days prior to Closing, each Exchange Optionholder who has entered into an Option Surrender Agreement shall receive from Company, in cancellation and exchange for its Exchanged Options and in accordance with At the terms and conditions effective time of the Option Surrender AgreementShort-Form Merger, a number the holders of Company Options shall cease to have any further right or entitlement to acquire any Company Capital Stock or any shares of capital stock of Parent under the terminated Company Common Stock equal to the quotient obtained by dividing (i) the Exchanged Options Value (as defined below) by (ii) the Per Share Purchase Price. “Exchanged Options Value” shall mean (i) the aggregate number of shares of Company Common Stock issuable upon exercise in full of the Exchanged Options multiplied by (ii) (A) the Per Share Purchase Price minus (B) the average exercise price per share of the Exchanged Options.

Cancellation of Company Options. (ai) The Board of Directors of Company has adopted resolutions Prior to the effect that each outstanding Effective Time, the Company Option held by shall provide each holder of Company Options (other than the Tranche 2 Options) (each a “Participating Company Option”) with the opportunity to elect, pursuant to such procedures as the Company shall reasonably determine, (i) whether to have the provisions of Section 3.01(d)(i)(1) apply, (ii) whether to have the provisions of Section 3.01(d)(i)(2) apply or (iii) whether to have the provisions of Section 3.01(e) apply. To the extent a holder of a Participating Company Option does not make an election, then Section 3.01(d)(i)(2) shall apply to such Participating Company Option. At the Effective Time, each Participating Company Option that is outstanding immediately prior to the Effective Time for which the holder of such Participating Company Option has elected to have the provisions of this Section 3.01(d)(i)(1) or Section 3.01(d)(i)(2) apply, or for which such holder does not make an election, shall be cancelled (each, an a “Optionholder” and, collectivelyCancelled Option”) in consideration for the right to receive (A) subject to the provisions of Annex I, the “Optionholders”) shall become exercisable in full. Not less than three Business Days prior contingent right to Closing, each Optionholder shall either exercise its Company Options by paying receive a number of Earnout Shares following the cash exercise thereof or, as to any Company Options not so exercised, enter into an option surrender and cancellation agreement (the “Option Surrender Agreement”) pursuant to which such Optionholder shall agree (i) to cancel and exchange such Company Options for shares of Company Common Stock pursuant to Section 2.4(c) below and (ii) to sell, transfer and assign such shares of Company Common Stock to Purchaser at Closing in accordance with Section 3.07 and Annex I and (B) the terms and conditions of this Agreement.following: (b1) if the holder of such Cancelled Option elects to have the provisions of Section 2.4(b3.01(d)(i)(1) apply (an “Option Cash Election”) with respect to such Cancelled Option (each such Cancelled Option, a “Cash Electing Option”), an amount in cash for such Cash Electing Option, without interest, equal to the Option Spread with respect to such Cash Electing Option, except that if the aggregate Option Spread with respect to all Cash Electing Options exceeds the Option Election Consideration Cap, then the amount of the Disclosure Schedule sets forth, as of the date hereof, the name of each Optionholder, the number of shares of Company Common Stock issuable upon the exercise of each Company cash payable with respect to such Cash Electing Option held by such Optionholdershall be reduced on a prorated basis, and the per share exercise price amount of each such Company Option. At least three Business Days prior to Closing, Sellers’ Representative shall deliver to Purchaser a revised Section 2.4(b) of the Disclosure Schedule identifying those Optionholders who, since the date of this Agreement, have exercised Company Options or have entered into an Option Surrender Agreement to cancel and exchange Company Options for shares of Company Common Stock pursuant to Section 2.4(c) hereof (such electing Optionholders are referred to herein as the “Exchange Optionholders” and the Company Options subject Spread that is not payable in cash due to such election are referred reduction shall be paid to herein as the “Exchanged Options”), together with executed copies of the Option Surrender Agreements. (c) Not less than three Business Days prior to Closing, each Exchange Optionholder who has entered into an Option Surrender Agreement shall receive from Company, such holder in cancellation and exchange for its Exchanged Options and in accordance with the terms and conditions of the Option Surrender Agreement, a number of validly issued, fully paid and nonassessable shares of Applicable Surviving Company Common Stock equal to (x) such amount that is not payable in cash divided by (y) $10; and (2) if the quotient obtained by dividing holder of such Cancelled Option elects to have the provisions of Section 3.01(d)(i)(2) apply (ian “Option Stock Election”) with respect to such Company Option, or the holder of such Cancelled Option fails to make an Option Cash Election or Option Stock Election with respect to such Cancelled Option, a number of validly issued, fully paid and nonassessable shares of Applicable Surviving Company Common Stock equal to (x) the Exchanged Options Value Option Spread with respect to such Cancelled Option divided by (as defined belowy) by $10. (ii) At the Per Share Purchase Price. “Exchanged Effective Time, each Tranche 2 Option that is outstanding immediately prior to the Effective Time shall be cancelled without payment to the holder thereof. (iii) Prior to the Effective Time, the Company shall take all actions reasonably necessary to effect the transactions anticipated by this Section 3.01(d) under the Company Option Plan and any Contract applicable to any Company Option (whether written or oral, formal or informal), including delivering all required notices, obtaining all necessary approvals and consents, and delivering evidence reasonably satisfactory to Acquiror that all necessary determinations by the Company Board or applicable committee thereof to cancel Company Options Value” shall mean (iin accordance with this Section 3.01(d) the aggregate number of shares of Company Common Stock issuable upon exercise in full of the Exchanged Options multiplied by (ii) (A) the Per Share Purchase Price minus (B) the average exercise price per share of the Exchanged Optionshave been made.

Cancellation of Company Options. (a) The Board of Directors of Company has adopted resolutions Prior to the effect Effective Time, the Company’s board of directors shall adopt appropriate resolutions and take all other actions necessary to (i) provide for the cancellation or exercise, effective immediately prior to the Effective Time, of all of the outstanding and unexercised Options that each outstanding Company Option held by are Vested immediately prior to the Effective Time, in exchange for (A) a cash payment from the Surviving Corporation, without interest thereon, to each holder of a Company Option (each, an “Optionholder” and, collectively, the “Optionholders”) shall become exercisable in full. Not less than three Business Days prior to Closing, each Optionholder shall either exercise its Company Vested Options by paying the cash exercise thereof or, as to any Company Options not so exercised, enter into an option surrender and cancellation agreement (the “Option Surrender Agreement”) pursuant to which such Optionholder shall agree (i) to cancel and exchange such Company Options for shares of Company Common Stock pursuant to Section 2.4(c) below and (ii) to sell, transfer and assign such shares of Company Common Stock to Purchaser at Closing in accordance with the terms and conditions of this Agreement. (b) Section 2.4(b) of the Disclosure Schedule sets forth, as of the date hereof, the name of each Optionholder, the number of shares of Company Common Stock issuable upon the exercise of each Company Option held by such Optionholder, and the per share exercise price of each such Company Option. At least three Business Days prior to Closing, Sellers’ Representative shall deliver to Purchaser a revised Section 2.4(b) of the Disclosure Schedule identifying those Optionholders who, since the date of this Agreement, have exercised Company Options or have entered into an Option Surrender Agreement to cancel and exchange Company Options for shares of Company Common Stock pursuant to Section 2.4(c) hereof (such electing Optionholders are referred to herein as the “Exchange Optionholders” and the Company Options subject to such election are referred to herein as the “Exchanged Options”), together with executed copies of the Option Surrender Agreements. (c) Not less than three Business Days prior to Closing, each Exchange Optionholder who has entered into an Option Surrender Agreement shall receive from Company, in cancellation and exchange for its Exchanged Options and in accordance with the terms and conditions of the Option Surrender Agreement, a number of shares of Company Common Stock equal to the quotient obtained by dividing (i) the Exchanged Options Value (as defined below) by (ii) the Per Share Purchase Price. “Exchanged Options Value” shall mean (i) the aggregate number of shares of Company Common Stock issuable upon on exercise in full of the Exchanged Vested portion of such Options multiplied by times the difference of (x) Closing Common Share Price, minus (y) the Option Strike Price with respect to such Vested Options, plus (B) a conditional amount equal to (1) such Optionholder’s Closing Percentage of the amount of the Escrow Funds available for distribution to the Equityholders pursuant to the Escrow Agreement, payable in accordance with Section 2.12, (2) such Optionholder’s Closing Percentage of the amount of any of the Stockholder Representative Reserve Fund distributable to the Equityholders in accordance with Section 2.14 and (3) such Optionholder’s Closing Percentage of the amount payable to Equityholders pursuant to Section 2.11; (ii) (A) the Per Share Purchase Price minus (B) the average exercise price per share cancel, as of the Exchanged OptionsEffective Time and without payment, all of the outstanding and unexercised Options that are not Vested immediately prior to the Effective Time and (iii) terminate the Company’s Option Plan as of the Effective Time. From and after the Effective Time, (i) each Option shall no longer be outstanding and shall automatically be cancelled and retired and shall cease to exist, and each holder of an Option shall cease to have any rights with respect thereto, except the right of each holder of a Vested Option to receive a portion of the Merger Consideration for such Vested Option, and without interest thereon, payable to the holders of Vested Options in accordance with this Agreement and the Escrow Agreement, and (ii) no other equity incentive awards under the Option Plan or otherwise shall be outstanding. In addition to the consideration payable to the Optionholders under this Section 2.6(b), such Optionholders shall be entitled to additional payments, if any, made in accordance with Sections 2.11, 2.12 and 2.14, and as set forth in the Merger Consideration Allocation Schedule. All of the payments to Optionholders as described in this Section 2.6(b) shall be made in accordance with Section 409A of the Code, including the requirement that such payments shall be made on the same terms and conditions as apply to payments to shareholders generally and shall be made not later than five years after the Closing Date.