Common use of CORPORATE PROCEEDINGS OF THE CORPORATION Clause in Contracts

CORPORATE PROCEEDINGS OF THE CORPORATION. (a) The existence of the Option shall not affect in any way the right or power of the Corporation or its officers, directors and shareholders, as the case may be, to (i) make or authorize any adjustments, recapitalizations, reorganizations or other changes in the capital structure or business of the Corporation, (ii) participate in any merger or consolidation of the Corporation, (iii) issue any Common Stock, bonds, debentures, preferred or prior preference stock or any other securities affecting the Common Stock or the rights of holders thereof, (iv) dissolve or liquidate the Corporation, (v) sell or transfer all or any part of the assets or business of the Corporation, or (vi) perform any other corporate act or proceedings, whether of a similar character or otherwise. (b) If the Corporation merges into or with or consolidates with (such events collectively referred herein as a "Merger") any corporation or corporations and is not the surviving corporation, then the surviving corporation may assume the Option or substitute a new option of the surviving corporation for the Option; provided, however, that the excess of the aggregate fair market value of the securities subject to the Option immediately after such assumption, or the new option immediately after such substitution, over the aggregate Exercise Price of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not less than the excess of the aggregate fair market value of the Common Stock subject to the Option immediately before such substitution or assumption over the aggregate Exercise Price of such Common Stock. (c) In the event that the surviving corporation does not utilize the provisions of (b) above, or in the event of a dissolution or liquidation of the Corporation, the Corporation shall cause written notice of such Merger or dissolution or liquidation (and the material terms and conditions thereof) to be delivered to the Optionee at least ten (10) days prior to the proposed effective date (the "Effective Date") of such event. The Optionee shall be entitled to exercise the Option until the Effective Date, or until the Expiration Date if earlier. To the extent that the Merger or liquidation is consummated after the Effective Date, the Option shall terminate and the Corporation shall have no further obligations of any type hereunder. The provisions of this paragraph shall not apply to any merger or reorganization, the principal purpose of which is to change the jurisdiction of the domicile of the Corporation. (d) If, while the Option is outstanding, the Corporation shall effect a subdivision or consolidation of the shares of Common Stock or other capital readjustment, the payment of a common stock dividend, or other increase or reduction of the number of shares of Common Stock outstanding, without receiving compensation therefor in money, services or property, then (i) in the event of an increase in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately increased, and the per share Exercise Price shall be proportionately reduced, and (ii) in the event of a reduction in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately reduced, and the per share Exercise Price shall be proportionately increased. No fractional share of Common Stock shall be issued upon any such exercise and the Exercise Price shall be appropriately reduced on account of any fractional share not issued. (e) The issuance by the Corporation of shares of stock of any class of securities convertible into shares of stock of any class, including Common Stock, for cash, property, labor or services rendered, either upon direct sale or upon the exercise of rights, options, or warrants to subscribe therefor, or upon conversion of shares or obligations of the Corporation convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Option Shares or the Exercise Price.

CORPORATE PROCEEDINGS OF THE CORPORATION. (a) The existence of the Option shall not affect in any way the right or power of the Corporation or its officers, directors and shareholders, as the case may be, to (i) make or authorize any adjustments, recapitalizations, reorganizations or other changes in the capital structure or business of the Corporation, (ii) participate in any merger or consolidation of the Corporation, (iii) issue any Common Stock, bonds, debentures, preferred or prior preference stock or any other securities affecting the Common Stock or the rights of holders thereof, (iv) dissolve or liquidate the Corporation, (v) sell or transfer all or any part of the assets or business of the Corporation, or (vi) perform any other corporate act or proceedings, whether of a similar character or otherwise. (b) If the Corporation merges into or with or consolidates with (such events collectively referred herein as a "Merger") any corporation or corporations and is not the surviving corporation, then the surviving corporation may assume the Option or substitute a new option of the surviving corporation for the Option; provided, however, that the excess of the aggregate fair market value of the securities subject to the Option immediately after such assumption, or the new option immediately after such substitution, over the aggregate Exercise Price of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not less than the excess of the aggregate fair market value of the Common Stock subject to the Option immediately before such substitution or assumption over the aggregate Exercise Price of such Common Stock. (c) In the event that the surviving corporation does not utilize the provisions of (b) above, or in the event of a dissolution or liquidation of the Corporation, the Corporation shall cause written notice of such Merger or dissolution or liquidation (and the material terms and conditions thereof) to be delivered to the Optionee at least ten (10) days prior to the proposed effective date (the "Effective Date") of such event. The Optionee shall be entitled to exercise the Option (as to all Option Shares, whether or not the Option is then otherwise exercisable under Section 2) until the Effective Date, or until the Expiration Date if earlier. To the extent that the Merger or liquidation is consummated after the Effective Date, the Option shall terminate and the Corporation shall have no further obligations of any type hereunder. The provisions of this paragraph shall not apply to any merger or reorganization, the principal purpose of which is to change the jurisdiction of the domicile of the Corporation. (d) If, while the Option is outstanding, the Corporation shall effect a subdivision or consolidation of the shares of Common Stock or other capital readjustment, the payment of a common stock dividend, or other increase or reduction of the number of shares of Common Stock outstanding, without receiving compensation therefor in money, services or property, then (i) in the event of an increase in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately increased, and the per share Exercise Price shall be proportionately reduced, and (ii) in the event of a reduction in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately reduced, and the per share Exercise Price shall be proportionately increased. No fractional share of Common Stock shall be issued upon any such exercise and the Exercise Price shall be appropriately reduced on account of any fractional share not issued. (e) The issuance by the Corporation of shares of stock of any class of securities convertible into shares of stock of any class, including Common Stock, for cash, property, labor or services rendered, either upon direct sale or upon the exercise of rights, options, or warrants to subscribe therefor, or upon conversion of shares or obligations of the Corporation convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Option Shares or the Exercise Price.

CORPORATE PROCEEDINGS OF THE CORPORATION. (a) The existence of the Option shall not affect in any way the right or power of the Corporation or its officers, directors and shareholders, as the case may be, to (i) make or authorize any adjustments, recapitalizations, reorganizations or other changes in the capital structure or business of the Corporation, (ii) participate in any merger or consolidation of the Corporation, (iii) issue any Common Stock, bonds, debentures, preferred or prior preference stock or any other securities affecting the Common Stock or the rights of holders thereof, (iv) dissolve or liquidate the Corporation, (v) sell or transfer all or any part of the assets or business of the Corporation, or (vi) perform any other corporate act or proceedings, whether of a similar character or otherwise. (b) If the Corporation merges into or with or consolidates with (such events collectively referred herein as a "Merger") any corporation or corporations and is not the surviving corporation, then the Corporation shall cause the surviving corporation may to assume the Option or substitute a new option of the surviving corporation for the Option (with an Exercise Period at least equal to the period remaining until the Expiration Date for the Option; provided). In the event that the Option is assumed or a new option of the surviving corporation is substituted for the Option (i) if, howeveron the effective date of the Merger, that the Option is "in the money" the excess of the aggregate fair market value of the securities shares subject to the Option immediately after such assumption, or the new option immediately after such substitution, over the aggregate Exercise Price of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not less than the excess of the aggregate fair market value of the Common Stock subject to the Option immediately before such substitution or assumption over the aggregate Exercise Price of such Common Stock and (ii) if, on the effective date of the Merger, the Option is "out of the money" the excess of the aggregate Exercise Price of the shares subject to the Option immediately after such assumption, or the new option immediately after such substitution over the fair market value of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not more than the excess of the aggregate Exercise Price of the Common Stock subject to the Option immediately before such assumption or substitution over the aggregate fair market value of such Common Stock. (c) In the event that the surviving corporation does not utilize the provisions of (b) above, or in the event of a dissolution or liquidation of the Corporation, the Corporation shall cause written notice of such Merger or dissolution or liquidation (and the material terms and conditions thereof) to be delivered to the Optionee at least ten thirty (1030) days prior to the proposed effective date (the "Effective Date") of such event. The Optionee (and the Optionee's transferees) shall be entitled to exercise the Option (as to all Option Shares, whether or not the Option is then otherwise exercisable under Section 2) until the earlier of the Effective Date, Date or until the Expiration Date. Any Option which has not been exercised on or before the Effective Date shall terminate. Notwithstanding the foregoing, in the event that Optionee (and/or Optionee's transferees) is precluded from immediately selling the Option Shares received upon the exercise of the Option by applicable state or federal securities laws, the Corporation agrees to loan to Optionee (and/or Optionee's transferees, if earlierapplicable) amounts necessary to fund the Payments to the Corporation pursuant to Section 3 hereof upon the exercise of the Option. The loans contemplated by this Section shall bear interest (at the average borrowing rate charged from time to time on the Company's indebtedness to its principal lender or lenders), shall be secured by the Option Shares issued upon the exercise of the applicable Option and shall be repayable promptly after the lapse of the securities laws restrictions which precluded the sale of the Option Shares by Optionee (and Optionee's transferees, if applicable) immediately after exercise of the Option. To the extent that the Merger dissolution or liquidation is consummated after the Effective Expiration Date, the Option shall terminate and the Corporation shall have no further obligations of any type hereunder. The provisions of this paragraph shall not apply to any merger or reorganization, the principal purpose of which is to change the jurisdiction of the domicile of the Corporation. (df) If, while the Option is outstanding, the Corporation shall effect a subdivision or consolidation of the shares of Common Stock or other capital readjustment, the payment of a common stock dividend, or other increase or reduction of the number of shares of Common Stock outstanding, without receiving compensation therefor in money, services or property, then (i) in In the event of an increase in that neither the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately increased, and the per share Exercise Price shall be proportionately reduced, and (ii) in the event of a reduction in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately reduced, and the per share Exercise Price shall be proportionately increased. No fractional share of Common Stock shall be issued upon any such exercise and the Exercise Price shall be appropriately reduced on account of any fractional share not issued. (e) The issuance by the Corporation of shares of stock of any class of securities convertible into the Corporation nor shares of stock of any classthe surviving corporation are listed on an established exchange as a result of a "going private" transaction, including Common Stockthe Fair Market Value of the Option (as to all Option Shares, for cashwhether or not the Option is then exercisable under Section 2) shall be determined as soon as practicable after completion of the "going private" transaction. Optionee shall be paid the Fair Market Value of such Option by cashiers check or wire transfer of immediately available funds within ten (10) days after the determination of such Fair Market Value. The Option shall terminate upon receipt of such payment by the Optionee. For purposes of this Section 8(f), propertythe "Fair Market Value" of the Option purchased shall be determined as follows: (i) If the Optionee and the Corporation can agree on the Fair Market Value of the Option within fifteen (15) days following completion of the going private transaction, labor the Fair Market Value will be the agreed value of the Option; (ii) If the Optionee and Corporation cannot agree on the Fair Market Value of the Option, the value will be determined as follows: (1) Each party shall, within thirty (30) days following completion of the going private transaction, provide written notice of the appointment of an appraiser to the other party. If the parties appoint the same appraiser or services renderedif only one appraiser is timely appointed, then the timely appointed appraiser shall be the only appraiser and shall prepare and deliver the appraised value of the Option taking into consideration the "Black-Scholes" method of valuation of such Option within thirty (30) days following its appointment; (2) If the parties each timely appoint different appraisers, such appraisers shall agree upon a third appraiser within fifteen (15) days following their appointment. If such appraisers cannot agree upon a third appraiser within fifteen (15) days following their appointment, either the Optionee or the Corporation may petition any United States federal district court in the Southern District of Texas to appoint such appraiser; (3) Each appraiser shall complete his appraisal of the Option taking into consideration the "Black-Scholes" method of valuation of such Option and deliver a copy of his written appraisal to the Optionee and the Corporation within thirty (30) days of such appraiser's appointment; (4) If there is more than one appraiser, the Fair Market Value shall be the mathematical average of the two closest appraisals; (5) Each appraiser appointed hereunder shall have been actively involved in the business of valuing and appraising companies in the oil and gas service industry for the five year period immediately preceding the date of appointment; and (6) The parties understand and agree that the value of the Option is dependent upon direct sale or upon the exercise of rights, options, or warrants to subscribe therefor, or upon conversion of shares or obligations a valuation of the Corporation convertible into such shares or other securitiesand that the appraisers shall have access to the business records, shall not affect, assets and no adjustment by reason thereof shall be made with respect to, properties of the number Corporation as they may reasonably request for the purpose of Option Shares or appraising the Exercise Pricevalue of the Option."

CORPORATE PROCEEDINGS OF THE CORPORATION. (a) The existence of the Option shall not affect in any way the right or power of the Corporation or its officers, directors and shareholders, as the case may be, to (i) make or authorize any adjustments, recapitalizations, reorganizations or other changes in the capital structure or business of the Corporation, (ii) participate in any merger or consolidation of the Corporation, (iii) issue any Common Stock, bonds, debentures, preferred or prior preference stock or any other securities affecting the Common Stock or the rights of holders thereof, (iv) dissolve or liquidate the Corporation, (v) sell or transfer all or any part of the assets or business of the Corporation, or (vi) perform any other corporate act or proceedings, whether of a similar character or otherwise. (b) If the Corporation merges into or with or consolidates with (such events collectively referred herein as a "Merger") any corporation or corporations and is not the surviving corporation, then the Corporation shall cause the surviving corporation may to assume the Option or substitute a new option of the surviving corporation for the Option (with an Exercise Period at least equal to the period remaining until the Expiration Date for the Option; provided). In the event that the Option is assumed or a new option of the surviving corporation is substituted for the Option (i) if, howeveron the effective date of the Merger, that the Option is "in the money" the excess of the aggregate fair market value of the securities shares subject to the Option immediately after such assumption, or the new option immediately after such substitution, over the aggregate Exercise Price of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not less than the excess of the aggregate fair market value of the Common Stock subject to the Option immediately before such substitution or assumption over the aggregate Exercise Price of such Common Stock and (ii) if, on the effective date of the Merger, the Option is "out of the money" the excess of the aggregate Exercise Price of the shares subject to the Option immediately after such assumption, or the new option immediately after such substitution over the fair market value of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not more than the excess of the aggregate Exercise Price of the Common Stock subject to the Option immediately before such assumption or substitution over the aggregate fair market value of such Common Stock. (c) In the event that the surviving corporation does not utilize the provisions of (b) above, or in the event of a dissolution or liquidation of the Corporation, the Corporation shall cause written notice of such Merger or dissolution or liquidation (and the material terms and conditions thereof) to be delivered to the Optionee at least ten (10) days prior to the proposed effective date (the "Effective Date") of such event. The Optionee shall be entitled to exercise the Option (as to all Option Shares, whether or not the Option is then otherwise exercisable under Section 2) until the Effective Date, or until the Expiration Date if earlier. To the extent that the Merger Any Option which has not been exercised on or liquidation is consummated after before the Effective Date, the Option Date shall terminate and the Corporation shall have no further obligations of any type hereunder. The provisions of this paragraph shall not apply to any merger or reorganization, the principal purpose of which is to change the jurisdiction of the domicile of the Corporationterminate. (d) If, while the Option is outstanding, the Corporation shall effect a subdivision or consolidation of the shares of Common Stock or other capital readjustment, the payment of a common stock dividend, or other increase or reduction of the number of shares of Common Stock outstanding, without receiving compensation therefor in money, services or property, then (i) in the event of an increase in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately increased, and the per share Exercise Price shall be proportionately reduced, and (ii) in the event of a reduction in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately reduced, and the per share Exercise Price shall be proportionately increased. No fractional share of Common Stock shall be issued upon any such exercise and the Exercise Price shall be appropriately reduced on account of any fractional share not issued. (e) The issuance by the Corporation of shares of stock of any class of securities convertible into shares of stock of any class, including Common Stock, for cash, property, labor or services rendered, either upon direct sale or upon the exercise of rights, options, or warrants to subscribe therefor, or upon conversion of shares or obligations of the Corporation convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Option Shares or the Exercise Price. (f) In the event that neither the shares of stock of the Corporation nor shares of stock of the surviving corporation are listed on an established exchange as a result of a "going private" transaction, the Fair Market Value of the Option (as to all Option Shares, whether or not the Option is then exercisable under Section 2) shall be determined as soon as practicable after completion of the "going private" transaction. Optionee shall be paid the Fair Market Value of such Option by cashiers check or wire transfer of immediately available (i) If the Optionee and the Corporation can agree on the Fair Market Value of the Option within fifteen (15) days following completion of the going private transaction, the Fair Market Value will be the agreed value of the Option; (ii) If the Optionee and Corporation cannot agree on the Fair Market Value of the Option, the value will be determined as follows: (1) Each party shall, within thirty (30) days following completion of the going private transaction, provide written notice of the appointment of an appraiser to the other party. If the parties appoint the same appraiser or if only one appraiser is timely appointed, then the timely appointed appraiser shall be the only appraiser and shall prepare and deliver the appraised value of the Option taking into consideration the "Black-Scholes" method of valuation of such Option within thirty (30) days following its appointment; (2) If the parties each timely appoint different appraisers, such appraisers shall agree upon a third appraiser within fifteen (15) days following their appointment. If such appraisers cannot agree upon a third appraiser within fifteen (15) days following their appointment, either the Optionee or the Corporation may petition any United States federal district court in the Southern District of Texas to appoint such appraiser; (3) Each appraiser shall complete his appraisal of the Option taking into consideration the "Black-Scholes" method of valuation of such Option and deliver a copy of his written appraisal to the Optionee and the Corporation within thirty (30) days of such appraiser's appointment; (4) If there is more than one appraiser, the Fair Market Value shall be the mathematical average of the two closest appraisals; (5) Each appraiser appointed hereunder shall have been actively involved in the business of valuing and appraising companies in the oil and gas service industry for the five year period immediately preceding the date of appointment; and (6) The parties understand and agree that the value of the Option is dependent upon a valuation of the Corporation and that the appraisers shall have access to the business records, assets and properties of the Corporation as they may reasonably request for the purpose of appraising the value of the Option.

CORPORATE PROCEEDINGS OF THE CORPORATION. (a) The existence of the Option shall not affect in any way the right or of power of the Corporation corporation or its officers, directors and shareholders, as the case may be, to (i) make or authorize any adjustments, recapitalizationsrecapitalization, reorganizations reorganization or other changes in the capital structure or business of the Corporation, (ii) participate in any merger or consolidation of the Corporationcorporation, (iii) issue any Common Stockstock, bonds, debentures, preferred or prior preference stock or any other securities affecting the Common Stock or the rights of holders thereof, (iv) dissolve or liquidate the Corporation, (v) sell or transfer all or any part of the assets or business of the Corporation, or (vi) perform any other corporate act or proceedings, whether of a similar character or otherwise. (b) If the Corporation merges into or with or consolidates with (such events collectively referred herein as a "Merger") any corporation or corporations and is not the surviving corporation, then the surviving corporation may assume the Option or substitute a new option of the surviving corporation for the Option; , provided, however, that the excess of the aggregate fair market value of the securities subject to the Option immediately after such assumption, or the new option immediately after such substitution, over the aggregate Exercise Price of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not less than the excess of the aggregate fair market value of the Common Stock subject to the Option immediately before such substitution or assumption over the aggregate Exercise Price price of such Common Stock. (c) In the event that the surviving corporation does not utilize the provisions of (b) above, or in the event of a dissolution or liquidation of the Corporation, the Corporation shall cause written notice of such Merger or dissolution or liquidation (and the material terms and conditions thereof) to be delivered to the Optionee at least ten (10) days prior to the proposed effective date (the "Effective Date") of such event. The Optionee shall be entitled to exercise the Option until the Effective Date, or until the Expiration Date if earlier. To the extent that the Merger merger or liquidation is consummated after the Effective Date, the Option shall terminate and the Corporation shall have no further obligations of any type hereunder. The provisions of this paragraph shall not apply to any merger or reorganization, the principal purpose of which is to change the jurisdiction of the domicile of the Corporation. (d) If, while the Option is outstanding, the Corporation shall effect a subdivision or consolidation of the shares share of Common Stock stock or other capital readjustment, the payment of a common stock dividend, or other increase or reduction of the number of shares of Common Stock outstanding, without receiving compensation therefor in money, services or property, then (i) in the event of an increase in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately increased, and the per share Exercise Price shall be proportionately reduced, and (ii) in the event of a reduction in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately reduced, and the per share Exercise Price shall be proportionately increased. No fractional share of Common Stock shall be issued upon any such exercise and the Exercise Price shall be appropriately reduced on account of any fractional share not issued. (e) The issuance by the Corporation of shares of stock of any class of securities convertible into shares of stock of any class, including Common Stock, for cash, property, labor or services rendered, either upon direct sale or upon the exercise of rights, options, or warrants to subscribe therefor, or upon conversion of shares or obligations of the Corporation convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Option Shares or the Exercise Price.

CORPORATE PROCEEDINGS OF THE CORPORATION. (a) The existence of the Option shall not affect in any way the right or power of the Corporation or its officers, directors and shareholders, as the case may be, to (i) make or authorize any adjustments, recapitalizations, reorganizations or other changes in the capital structure or business of the Corporation, (ii) participate in any merger or consolidation of the Corporation, (iii) issue any Common Stock, bonds, debentures, preferred or prior preference stock or any other securities affecting the Common Stock or the rights of holders thereof, (iv) dissolve or liquidate the Corporation, (v) sell or transfer all or any part of the assets or business of the Corporation, or (vi) perform any other corporate act or proceedings, whether of a similar character or otherwise. (b) If the Corporation merges into or with or consolidates with (such events collectively referred herein as a "Merger") any corporation or corporations and is not the surviving corporation, then the surviving corporation may assume the Option or substitute a new option of the surviving corporation for the Option; provided, however, that the excess of the aggregate fair market value of the securities subject to the Option immediately after such assumption, or the new option immediately after such substitution, over the aggregate Exercise Price of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not less than the excess of the aggregate fair market value of the Common Stock subject to the Option immediately before such substitution or assumption over the aggregate Exercise Price of such Common Stock. (c) In the event that the surviving corporation does not utilize the provisions of (b) above, or in the event of a dissolution or liquidation of the Corporation, the Corporation shall cause written notice of such Merger or dissolution or liquidation (and a description of the material terms and conditions thereof) thereof to be delivered to the Optionee (and Optionee's transferees) at least ten thirty (1030) days prior to the proposed effective date (the "Effective Date") of such event. The Optionee (and Optionee's transferees) shall be entitled to exercise the Option (as to all Option Shares, whether or not the Option is not then otherwise exercisable under Section 2) until the earlier of the Effective Date, Date or until the Expiration Date Date. Notwithstanding the foregoing, in the event that Optionee (and/or Optionee's transferees) is precluded from immediately selling the Option Shares received upon the exercise of the Options by applicable state or federal securities laws, the Corporation agrees to loan to Optionee (and/or Optionee's transferees, if earlierapplicable) amounts necessary to fund the Payments to the Corporation pursuant to Section 3 hereof upon the exercise of the Options. The loans contemplated by this Section shall bear interest (at the average borrowing rate charged from time to time on the Company's indebtedness to its principal lender or lenders), shall be secured by the Option Shares issued upon the exercise of the applicable Options and shall be repayable promptly after the lapse of the securities laws restrictions which precluded the sale of the Option Shares by Optionee (and Optionee's transferees, if applicable) immediately after exercise of the Options. To the extent that the Merger Merger, dissolution or liquidation is consummated after the Effective Expiration Date, the Option shall terminate and the Corporation shall have no further obligations of any type hereunder. The provisions of this paragraph shall not apply to any merger or reorganization, the principal purpose of which is to change the jurisdiction of the domicile of the Corporation. (d) If, while the Option is outstanding, the Corporation shall effect a subdivision or consolidation of the shares of Common Stock or other capital readjustment, the payment of a common stock dividend, or other increase or reduction of the number of shares of Common Stock outstanding, without receiving compensation therefor in money, services or property, then (i) in the event of an increase in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately increased, and the per share Exercise Price shall be proportionately reduced, and (ii) in the event of a reduction in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately reduced, and the per share Exercise Price shall be proportionately increased. No fractional share of Common Stock shall be issued upon any such exercise and the Exercise Price shall be appropriately reduced on account of any fractional share not issued. (e) The issuance by the Corporation of shares of stock of any class of securities convertible into shares of stock of any class, including Common Stock, for cash, property, labor or services rendered, either upon direct sale or upon the exercise of rights, options, or warrants to subscribe therefor, or upon conversion of shares or obligations of the Corporation convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Option Shares or the Exercise Price.

CORPORATE PROCEEDINGS OF THE CORPORATION. (a) The existence of the Option shall not affect in any way the right or power of the Corporation or its officers, directors and shareholders, as the case may be, to (i) make or authorize any adjustments, recapitalizations, reorganizations or other changes in the capital structure or business of the Corporation, (ii) participate in any merger or consolidation of the Corporation, (iiiii) issue any Common Stock, bonds, debentures, preferred or prior preference stock or any other securities affecting the Common Stock or the rights of holders thereof, (iv) dissolve or liquidate the Corporation, (v) sell or transfer all or any part of the assets or business of the Corporation, or (vi) perform any other corporate act or proceedings, whether of a similar character or otherwise. (b) If the Corporation merges into or with or consolidates with (such events collectively referred herein as a "Merger") any corporation or corporations and is not the surviving corporation, then the surviving corporation may assume the Option or substitute a new option of the surviving corporation for the Option; provided, however, that the excess of the aggregate fair market value of the securities subject to the Option immediately after such assumption, or the new option immediately after such substitution, over the aggregate Exercise Price of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not less than the excess of the aggregate fair market value of the Common Stock stock subject to the Option immediately before such substitution or assumption over the aggregate Exercise Price of such Common Stock. (c) In the event that the surviving corporation does not utilize the provisions of (b) above, or in the event of a dissolution or liquidation of the Corporation, the Corporation shall cause written notice of such Merger or dissolution or liquidation (and the material terms and conditions thereof) to be delivered to the Optionee at least ten (10) days prior to the proposed effective date (the "Effective Date") of such event. The Optionee shall be entitled to exercise the Option until the Effective Date, or until the Expiration Date if earlier. To the extent that the Merger or liquidation is consummated after the Effective Date, the Option shall terminate and the Corporation shall have no further obligations of any type hereunder. The provisions of this paragraph shall not apply to any merger or reorganization, the principal purpose of which is to change the jurisdiction of the domicile of the Corporation. (d) If, while the Option is outstanding, the Corporation shall effect a subdivision or consolidation of the shares of Common Stock or other capital readjustment, the payment of a common stock dividend, or other increase or reduction of the number of shares of Common Stock outstanding, without receiving compensation therefor in money, services or property, then (i) in the event of an increase in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately increased, and the per share Exercise Price shall be proportionately reduced, and (ii) in the event of a reduction in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately reduced, and the per share Exercise Price shall be proportionately increased. No fractional share of Common Stock shall be issued upon any such exercise and the Exercise Price shall be appropriately reduced on account of any fractional share not issued. (e) The issuance by the Corporation of shares of stock of any class of securities convertible into shares of stock of any class, including Common Stock, for cash, property, labor or services rendered, either upon direct sale or upon the exercise of rights, options, or warrants to subscribe therefor, or upon conversion of shares or obligations of the Corporation convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Option Shares or the Exercise Price.

CORPORATE PROCEEDINGS OF THE CORPORATION. (a) The existence of the Option shall not affect in any way the right or power of the Corporation or its officers, directors and shareholders, as the case may be, to (i) make or authorize any adjustments, recapitalizations, reorganizations or other changes in the capital structure or business of the Corporation, Corporation (ii) participate in any merger or consolidation of the Corporation, (iii) issue any Common Stock, bonds, debentures, preferred or prior preference stock or any other securities affecting the Common Stock or the rights of holders thereof, (iv) dissolve or liquidate the Corporation, (v) sell or transfer all or any part of the assets or business of the Corporation, Corporation or (vi) perform any other corporate act or proceedings, whether of a similar character or otherwise. (b) If the Corporation merges into or with or consolidates with (such events collectively referred herein as a "Merger") any corporation or corporations and is not the surviving corporation, then the surviving corporation may assume the Option or substitute a new option of the surviving corporation for the Option; provided, however, that the excess of the aggregate fair market value of the securities subject to the Option immediately after such assumption, or the new option immediately after such substitution, over the aggregate Exercise Price of such shares must be, based upon a good faith determination by the Board of Directors of the Corporation, not less than the excess of the aggregate fair market value of the Common Stock subject to the Option immediately before such substitution substitution. or assumption over the aggregate Exercise Price of such Common Stock. (c) In the event that the surviving corporation does not utilize the provisions of (b) above, or in the event of a dissolution or liquidation of the Corporation, the Corporation shall cause written notice of such Merger or dissolution or liquidation (and the material terms and conditions thereof) to be delivered to the Optionee at least ten (10) days prior to the proposed effective date (the "Effective Date") of such event. The Optionee shall be entitled to exercise the Option until the Effective Date, or until the Expiration Date if earlier. To the extent that the Merger or liquidation is consummated after the Effective Date, the Option shall terminate and the Corporation shall have no further obligations of any type hereunder. The provisions of this paragraph shall not apply to any merger or reorganization, the principal purpose of which is to change the jurisdiction of the domicile of the Corporation. (d) If, while the Option is outstanding, outstanding the Corporation shall effect a subdivision or consolidation of the shares of Common Stock or other capital readjustment, the payment of a common stock dividend, or other increase or reduction of the number of shares of Common Stock outstanding, without receiving compensation therefor in money, services or property, then (i) in the event of an increase in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately increased, and the per share Exercise Price shall be proportionately reduced, and (ii) in the event of a reduction in the number of shares of Common Stock outstanding, the number of Option Shares shall be proportionately reduced, and the per share Exercise Price shall be proportionately increased. No fractional share of Common Stock shall be issued upon any such exercise and the Exercise Price shall be appropriately reduced on account of any fractional share not issued. (e) The issuance by the Corporation of shares of stock of any class of securities convertible into shares of stock of any class, including Common Stock, for cash, property, labor or services rendered, either upon direct sale or upon the exercise of rights, options, or warrants to subscribe therefor, or upon conversion of shares or obligations of the Corporation convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Option Shares or the Exercise Price.