Common use of COMPANY'S REPURCHASE OPTION Clause in Contracts

COMPANY'S REPURCHASE OPTION. (a) Upon the termination of the Shareholder’s employment or service with the Company for any reason, the Company shall have the right and option to purchase, and the Shareholder or the Shareholder’s personal representative, estate, heirs, legatees, or Permitted Transferees, as the case may be, shall have the obligation to sell, all of the Shareholder’s Shares, which option may be exercised by the Company within one hundred and eighty (180) days following the later of (i) such termination of employment or service, or (ii) the date the Shares are acquired, by giving written notice to the Shareholder or personal representative, estate, heirs, legatees, or Permitted Transferees, as the case may be. The purchase price for such Shares shall be determined pursuant to Section 4(b) of this Agreement. Settlement of the purchase shall be made at the principal office of the Company within 30 days after delivery of such written notice. In the discretion of the Board of Directors of the Company, payment of the purchase price will be made via cash, a promissory note, or a combination of the two. Any such promissory note shall provide for substantially equal installments, payable at least annually, over a period not to exceed five years and shall accrue interest at the applicable Federal mid-term rate in effect under Code section 1274(d) as of the settlement date, compounded annually. Notwithstanding the foregoing, the repurchase option of the Company described in this Section 4: (i) shall not be exercisable with respect to Offered Shares when the Company has a right to purchase such Offered Shares pursuant to Section 2(b) of this Agreement nor, if the Company does not elect to purchase all of the Offered Shares, during the period set forth in Section 2(d) of this Agreement in which the Offered Shares are transferable pursuant to the terms of the Transfer Notice; and (ii) shall terminate upon the closing of the first public offering of securities of the Company that is effected pursuant to a registration statement filed with, and declared effective by, the Securities and Exchange Commission under the Securities Act of 1933. (b) The purchase price for any Shares sold and purchased pursuant to this Section 4 shall be equal to their Fair Market Value (determined as set forth below); provided, however, that if the Shareholder’s employment or service with the Company is terminated for “Cause” (as defined in the Plan), then the purchase price for any Shares sold and purchased pursuant to this Section 4 shall be equal to the lesser of their Fair Market Value or the amount paid by the Shareholder to purchase the Shares. For purposes of this Agreement, the “Fair Market Value” of Shares shall be determined in good faith by the Board of Directors of the Company. In making such determination, the Board of Directors may take into account any valuation factors it deems appropriate or advisable in its sole discretion, including, without limitation, profitability, financial position, asset value or other factors relating to the value of the Company, as well as discounts to account for minority interests and lack of marketability.

COMPANY'S REPURCHASE OPTION. (a) Upon the termination of the Shareholder’s employment or service relationship with the Company for any reason, the Company shall have the right and option to purchase, and the Shareholder or the Shareholder’s personal representative, estate, heirs, legatees, legatees or Permitted TransfereesTransferees (as defined in the Stockholders’ Agreement), as the case may be, shall have the obligation to sellsell upon request, any or all of the Shareholder’s Shares, which option may be exercised at any time and from time to time by the Company within one hundred and eighty (180) days following the later of (i) such termination of employment or service, or (ii) the date the Shares are acquired, by giving written notice to the Shareholder or personal representative, estate, heirs, legatees, legatees or Permitted Transferees, Transferees (as defined in the Stockholders’ Agreement) as the case may be, stating the number of Shares to be purchased. The purchase price for such Shares shall be determined pursuant to Section 4(b) of this Agreement. Settlement of the purchase shall be made at the principal executive office of the Company within 30 90 days after delivery of such written notice. In the discretion of the Board of Directors of the Company, payment of the purchase price will be made via cash, cancellation of indebtedness, a promissory note, or a combination of the twosuch methods. Any such promissory note shall provide for substantially equal installments, payable at least annually, over a period not to exceed five years and shall accrue interest at the applicable Federal mid-term rate in effect under Code section 1274(d) as of the settlement date, compounded annually. Notwithstanding the foregoing, the repurchase option of the Company described in this Section 4: (i) 4 shall not be exercisable terminate, solely with respect to Offered Shares when the Company has a right to purchase such Offered Shares pursuant to Section 2(b) of this Agreement nor, if the Company does not elect to purchase all of the Offered vested Shares, during the period set forth in Section 2(d) of this Agreement in which the Offered Shares are transferable pursuant to the terms of the Transfer Notice; and (ii) shall terminate upon the closing of the first public offering of securities of the Company that is effected pursuant to a registration statement filed with, and declared effective by, the Securities and Exchange Commission under the Securities Act of 19331933 or the exchange of the Shares for shares of an entity that are so registered. (b) The purchase price for any Shares sold and purchased pursuant to this Section 4 shall be equal to their Fair Market Value (as determined as set forth below); providedunder Section 4(c) of this Agreement. Notwithstanding the immediately preceding sentence, however, in the event that if the Shareholder’s employment or other service with relationship is terminated by the Company is terminated for “Cause,” (as defined in the Plan), then the purchase price for any Shares sold and purchased pursuant to this Section 4 shall be equal to the lesser exercise price per Share (adjusted to reflect adjustments made under Section 7(d) of their Fair Market Value or the amount paid Eschelon Telecom, Inc. 2002 Stock Incentive Plan) tendered to the Company by the Shareholder upon exercise of the Option pursuant to purchase which the SharesShares were acquired. For purposes of this Agreement, “Cause” shall mean the “Fair Market Value” Shareholder’s (i) conviction of, or plea of Shares shall be determined nolo contendere to, a felony or crime involving moral turpitude; (ii) fraud on or misappropriation of any funds or property of the Company, any affiliate, customer or vendor; (iii) personal dishonesty, incompetence, willful misconduct, willful violation of any law, rule or regulation (other than minor traffic violations or similar offenses), or breach of fiduciary duty which involves personal profit; (iv) willful misconduct in connection with the Shareholder’s duties or willful failure to perform the Shareholder’s responsibilities in the best interests of the Company; (v) chronic use of alcohol, drugs or other similar substances which affects the Shareholder’s work performance; (vi) violation of any material Company rule, regulation, procedure or policy; or (vii) breach of any provision of any employment, non-disclosure, non-competition, non-solicitation or other similar agreement executed by the Shareholder for the benefit of the Company. The good faith determination by the Board of Directors of the Company. In making such determination, Company of whether the Board of Directors may take into account any valuation factors it deems appropriate or advisable in its sole discretion, including, without limitation, profitability, financial position, asset value Shareholder’s employment or other factors relating to service relationship was terminated by the value of the Company, as well as discounts to account Company for minority interests Cause shall be final and lack of marketabilitybinding for all purposes hereunder.

COMPANY'S REPURCHASE OPTION. (a) Upon the termination of the Shareholder’s 's employment or service consulting relationship with the Company for any reason, the Company shall have the right and option to purchase, and the Shareholder or the Shareholder’s 's personal representative, estate, heirs, legatees, or Permitted Transferees, as the case may be, shall have the obligation to sellsell upon request, any or all of the Shareholder’s 's Shares, which option may be exercised at any time and from time to time by the Company within one hundred and eighty (180) days following the later of (i) such termination of employment or service, or (ii) the date the Shares are acquired, by giving written notice to the Shareholder or personal representative, estate, heirs, legatees, or Permitted Transferees, as the case may be, stating the number of Shares to be purchased. The purchase price for such Shares shall be determined pursuant to Section 4(b) of this Agreement. Settlement of the purchase shall be made at the principal office of the Company within 30 days after delivery of such written notice. In the discretion of the Board of Directors of the Company, payment of the purchase price will be made via cash, a promissory note, or a combination of the two. Any such promissory note shall provide for substantially equal installments, payable at least annually, over a period not to exceed five years and shall accrue interest at the applicable Federal mid-term rate in effect under Code section 1274(d) as of the settlement date, compounded annually. Notwithstanding the foregoing, the repurchase option of the Company described in this Section 4: (i) shall not be exercisable with respect to Offered Shares when the Company has a right to purchase such Offered Shares pursuant to Section 2(b) of this Agreement nor, if the Company does not elect to purchase all of the Offered Shares, during the period set forth in Section 2(d) of this Agreement in which the Offered Shares are transferable pursuant to the terms of the Transfer Notice; and (ii) shall terminate terminate, solely with respect to vested Shares, upon the closing of the first public offering of securities of the Company that is effected pursuant to a registration statement filed with, and declared effective by, the Securities and Exchange Commission under the Securities Act of 1933. (b) The purchase price for any Shares sold and purchased pursuant to this Section 4 shall be equal to their Fair Market Value (as determined as set forth below); providedunder Section 4(c) of this Agreement. Notwithstanding the immediately preceding sentence, however, in the event that if the Shareholder’s 's employment or other service with relationship is terminated by the Company is terminated for “Cause” (as defined in the Plan), then "Misconduct," the purchase price for any Shares sold and purchased pursuant to this Section 4 shall be equal to the lesser of their the Fair Market Value of the Shares as determined under Section 4(c) of this Agreement or the amount paid exercise price per Share (adjusted to reflect adjustments made under Section 7(d) of the Plan) tendered to the Company by the Shareholder upon exercise of the Option pursuant to purchase which the SharesShares were acquired. For purposes of this Agreement, if the “Fair Market Value” Shareholder is a party to a written employment agreement or other service agreement with the Company or an affiliate which contains a definition of Shares "cause," "termination for cause" or any other similar term or phrase, whether the Shareholder is terminated for Misconduct pursuant to this Section 4 shall be determined according to the terms of and in a manner consistent with the provisions of such written agreement. If the Shareholder is not party to such a written employment agreement or other service agreement with the Company or an affiliate, then for purposes of this Section 4, "Misconduct" shall mean the Shareholder's (i) conviction of, or plea of nolo contendere to, a felony or crime involving moral turpitude; (ii) fraud on or misappropriation of any funds or property of the Company; (iii) personal dishonesty, incompetence, willful misconduct, willful violation of any law, rule or regulation (other than minor traffic violations or similar offenses), or breach of fiduciary duty which involves personal profit; (iv) willful misconduct in connection with the Shareholder's duties or willful failure to perform the Shareholder's responsibilities in the best interests of the Company; (v) chronic use of alcohol, drugs or other similar substances which affects the Shareholder's work performance; or (vi) breach of any provision of any employment, non-disclosure, non-competition, non-solicitation or other similar agreement executed by the Shareholder for the benefit of the Company. The good faith determination by the Board of Directors of the Company. In making such determination, Company of whether the Board of Directors may take into account any valuation factors it deems appropriate or advisable in its sole discretion, including, without limitation, profitability, financial position, asset value Shareholder's employment or other factors relating to service relationship was terminated by the value of the Company, as well as discounts to account Company for minority interests Cause shall be final and lack of marketabilitybinding for all purposes hereunder.