Common use of Treatment of Stock Options Clause in Contracts

Treatment of Stock Options. Subject to Section 2.3, at the Effective Time, except for those options listed in Schedule 2.1(e) which are owned by the executive officers of the Company which have not been exercised at or prior to the Effective Time (the “Executive Options”), each option to purchase shares of Company Common Stock (each, a “Company Stock Option”) outstanding immediately prior to the Effective Time, and not exercised, which is vested or which by its terms will become vested at the Effective Time, shall be canceled and extinguished and converted into and become a right following the Effective Time to receive from the Company an amount of cash, without interest thereon and less any required withholding taxes, equal to the excess, if any, of (i) the Merger Consideration over (ii) the exercise price per share of such Company Stock Option (such amount payable in respect of any share of Company Common Stock into which a Company Stock Option is exercisable, the “Option Consideration”), multiplied by the number of shares of Company Common Stock for which such Company Stock Option is exercisable immediately prior to or at the Effective Time, and all other unvested Company Options (“Unvested Company Options”) will be cancelled without consideration. No cash payment will be due to a holder of such Company Stock Option in respect of such Company Stock Option or its termination if the amount set forth in clause (ii) exceeds the amount set forth in clause (i). Prior to the Effective Time, the Company shall take all actions (including, without limitation, obtaining all necessary consents from the holders of Company Stock Options) necessary to give effect to the transactions contemplated by this Section 2.1(e), and payments to particular holders pursuant to this Section 2.1(e) shall be conditioned upon their execution of such consents. The Option Consideration shall be payable on the first Business Day following the Effective Time. All Executive Options listed in Schedule 2.1(e) and not exercised as of the Effective Time shall remain outstanding after the Effective Time and should be continued as options to purchase a number (or fraction) of shares of common stock of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) in a manner consistent with Section 409A of the Code, as determined in the sole discretion of Parent, and otherwise shall be governed by their existing terms.

Treatment of Stock Options. Subject to Section 2.3, at the Effective Time, except for those options listed in Schedule 2.1(e) which are owned by the executive officers of the Company which have not been exercised at or prior to the Effective Time (the “Executive Options”), The Company’s Disclosure Letter sets forth each option to purchase acquire shares of Company Common Stock that is outstanding and unexercised as of the date hereof (eachcollectively, a “Company Stock Option”) pursuant to the Company Equity Plans. As of the Effective Time, all Company Stock Options outstanding and unexercised immediately prior to the Effective TimeTime shall, by virtue of the Merger, automatically and not exercisedwithout any action on the part of the holder thereof, which is become fully vested or which by its terms will become vested at the Effective Time, shall and be canceled and extinguished and converted into an option to purchase Purchaser Common Stock (a “Converted Stock Option”), on the same terms and become a right following the Effective Time conditions as were applicable under such Company Stock Option. The number of shares of Purchaser Common Stock subject to receive from the Company an amount of cash, without interest thereon and less any required withholding taxes, each such Converted Stock Option will be equal to the excess, if any, of product (rounded down to the nearest whole number) obtained by multiplying (i) the Merger Consideration over (ii) the exercise price per share of such Company Stock Option (such amount payable in respect of any share of Company Common Stock into which a Company Stock Option is exercisable, the “Option Consideration”), multiplied by the number of shares of Company Common Stock for which such subject to the applicable Company Stock Option is exercisable immediately prior to or at by (ii) the Effective TimeExchange Ratio, and all other unvested Company Options (“Unvested Company Options”) the exercise price of Purchaser Common Stock subject to each Converted Stock Option will be cancelled without consideration. No cash payment will be due equal to a holder of such the quotient obtained by dividing (x) the exercise price per Company Stock Option in by (y) the Exchange Ratio (rounded up to the nearest whole cent). The adjustment provided herein with respect of such to any Company Stock Option or its termination if Options which are “incentive stock options” (as defined in Section 422 of the amount set forth IRC) shall be and is intended to be effected in clause (iia manner that is consistent with Section 424(a) exceeds of the amount set forth in clause (i)IRC. Prior to Except as provided above, after the Effective Time, the Converted Stock Option shall continue to be governed by the same terms and conditions as were applicable under the Company Equity Plans and any award agreement. At all times after the Effective Time, Purchaser shall take all actions (including, without limitation, obtaining all reserve for issuance such number of shares of Purchaser Common Stock as necessary consents from so as to permit the holders exercise of Company Converted Stock Options) necessary to give effect to Options in the transactions manner contemplated by this Section 2.1(eAgreement and in the instruments pursuant to which such options were granted. Shares of Purchaser Common Stock issuable upon exercise of Converted Stock Options shall be covered by an effective registration statement on Form S-8 (or other applicable form), and payments to particular holders pursuant to this Section 2.1(ePurchaser shall file a registration statement on Form S-8 (or other applicable form) shall be conditioned upon their execution of covering such consents. The Option Consideration shall be payable on the first Business Day following shares as soon as practicable after the Effective Time. All Executive Options listed , but in Schedule 2.1(eno event later than ten (10) and not exercised as of the Effective Time shall remain outstanding after the Effective Time and should be continued as options to purchase a number (or fraction) of shares of common stock of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) in a manner consistent with Section 409A of the Code, as determined in the sole discretion of ParentBusiness Days thereafter, and otherwise shall be governed by their existing termsuse reasonable commercial efforts to maintain the effectiveness of such registration statement for so long as such Converted Stock Options remain outstanding.

Treatment of Stock Options. Subject Any outstanding, unexercised and unexpired stock options and other rights to Section 2.3, at the Effective Time, except for those options listed in Schedule 2.1(e) which are owned by the executive officers purchase or otherwise acquire shares of the Company which have Company’s capital stock, whether or not been exercised at presently exercisable or subject to additional conditions prior to the Effective Time exercise (collectively, the “Executive Company Options”), each option under and pursuant to purchase shares of Company Common the Company’s 2006 Stock Option Plan (each, a the “Company Stock OptionOption Plan”) outstanding shall automatically be accelerated in full so that each such Company Option is fully vested and exercisable immediately prior to the Effective Time, conditioned upon the consummation of the Merger, and not exercised, which is vested or which by its terms will become vested at the Effective Time, shall be canceled and extinguished and converted into and become a right following as of the Effective Time be converted automatically into options to receive buy a number of ordinary shares of the Surviving Company (the “Surviving Company Options”) (i) that provide the holders of the Company Options with the ability to obtain, upon exercise of such Surviving Company Options, a percentage interest in the ordinary shares of the Surviving Company equal to the percentage interest such holders would have obtained in the outstanding Company Ordinary Shares upon exercise of the Company Options immediately after the completion of the Recapitalization and (ii) with an exercise price adjusted to reflect the transactions contemplated by this Agreement and the Recapitalization Agreement. With respect to each Company Option, the Company shall use its commercially reasonable efforts to obtain, prior to the Closing Date, an option cancellation agreement from the holders of all such Company Options, in exchange for which the Company shall offer the stock option holder certain benefits and rights and/or an amount of cash, without interest thereon and less any required withholding taxes, equal to the excess, if any, of cash (i) the Merger Consideration over (ii) the exercise price per share of such Company Stock Option (such amount payable in respect of any share of Company Common Stock into which a Company Stock Option is exercisable, the “Option Consideration”), multiplied ) as determined by the number of shares of Company Common Stock for which and the applicable stock option holder as necessary to obtain the stock option holder’s agreement to cancel such Company Stock Options as contemplated herein. The Company shall pay or otherwise provide to such holders the Option is exercisable Consideration no later than immediately prior to or at the Effective Time, Time and the aggregate amount of Option Consideration paid to the stock option holders shall not exceed $25,000. A stock option holder’s agreement to the cancellation of Company Options in exchange for the Option Consideration shall release any and all other unvested Company Options (“Unvested Company Options”) will be cancelled without consideration. No cash payment will be due to a rights the holder of such Company Stock Option had or may have had in respect of such Company Stock Option Option. The Company shall provide to Parent on or its termination if the amount set forth in clause (ii) exceeds the amount set forth in clause (i). Prior prior to the Effective Time, the Closing Date copies of all executed option cancellation agreements. The Company shall use its commercially reasonable efforts to take all actions necessary (including, without limitation, obtaining all necessary consents from including causing an applicable Subsidiary or its Board of Directors to take such actions as are allowed by the holders of Company Stock OptionsOption Plan or any option award agreements) necessary to give effect to effectuate the transactions actions contemplated by this Section 2.1(e), and payments to particular holders pursuant to this Section 2.1(e) shall be conditioned upon their execution of such consents. The Option Consideration shall be payable on the first Business Day following the Effective Time. All Executive Options listed in Schedule 2.1(e) and not exercised as of the Effective Time shall remain outstanding after the Effective Time and should be continued as options to purchase a number (or fraction) of shares of common stock of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) in a manner consistent with Section 409A of the Code, as determined in the sole discretion of Parent, and otherwise shall be governed by their existing terms2.7.

Treatment of Stock Options. Subject to Section 2.3, at the Effective Time, except for those options listed in Schedule 2.1(e(a) which are owned by the executive officers of the Company which have not been exercised at or prior to the Effective Time (the “Executive Options”), each Each option to purchase shares of Company Common Stock Shares (each, individually a “Company Stock Option” and collectively, the “Stock Options”) outstanding immediately prior to the Effective TimeTime pursuant to any Company Benefit Plan or otherwise shall be substituted for an option to purchase shares of common stock of the Surviving Corporation or, and not exercised, which is vested or which by its terms will become vested at the Effective Timeelection of Parent, shall be canceled and extinguished and converted into and become any direct or indirect parent of the Surviving Corporation (a right following the Effective Time to receive from the Company an amount of cash, without interest thereon and less any required withholding taxes, equal to the excess, if any, of (i) the Merger Consideration over (ii) the exercise price per share of such Company Stock Option (such amount payable in respect of any share of Company Common Stock into which a Company Stock Option is exercisable, the “Option ConsiderationRollover Option”); provided, multiplied by the number of shares of Company Common Stock for which such Company Stock Option is exercisable immediately however, that prior to or at the Effective Time, and all other unvested Company Options (“Unvested Company Options”) will be cancelled without consideration. No cash payment will be due to a holder of such Company Stock Option in respect of such Company Stock Option or its termination if the amount set forth in clause (ii) exceeds the amount set forth in clause (i). Prior to the Effective Time, the Company shall take all actions (includingprovide each holder of a Stock Option that is “in-the-money” a Stock Option cancellation agreement, without limitationin a form acceptable to Parent, obtaining all necessary consents and if such holder executes and delivers to the Company such Stock Option cancellation agreement, in lieu of the conversion described above, each Stock Option will be canceled at the Effective Time and each holder of a Stock Option will, in full settlement of such Stock Option and in exchange for the surrender to the Company of any certificate or other document evidencing such Stock Option, receive from the holders of Company Stock Optionsan amount (subject to any applicable withholding) necessary to give effect in cash equal to the transactions contemplated product of (x) the excess, if any, of the Merger Consideration over the exercise price per Share of such Stock Option multiplied by this Section 2.1(e(y) the number of Shares subject to such Stock Option (with the aggregate amount of such payment rounded up to the nearest whole cent). If the applicable exercise price of any Stock Option equals or exceeds the Merger Consideration, such Stock Option shall be cancelled without payment of additional consideration, and payments all rights with respect to particular holders pursuant to this Section 2.1(e) such Stock Option shall be conditioned upon their execution terminate as of such consents. The Option Consideration shall be payable on the first Business Day following the Effective Time. All Executive Options listed Each Rollover Option shall be adjusted equitably to prevent any increase or decrease in Schedule 2.1(e) and not exercised the intrinsic value of its corresponding Stock Option as a result of the Effective Time shall remain outstanding after transactions contemplated hereby. At the Effective Time election of Parent, the substitution of Rollover Options contemplated hereby may be satisfied either by assumption and should be continued as options to purchase continuation of the relevant Stock Options and the Company Benefit Plans under which such Stock Options have been granted or by granting new Rollover Options under a number (stock incentive plan established by the Surviving Corporation or, at the election of Parent, any direct or fraction) of shares of common stock indirect parent of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) in a manner consistent with Section 409A of the Code, as determined in the sole discretion of Parent, and otherwise shall be governed by their existing termsCorporation.

Treatment of Stock Options. Subject to Section 2.3, at the Effective Time, except for those options listed in Schedule 2.1(e(a) which are owned by the executive officers of the Company which have not been exercised at or prior to the Effective Time (the “Executive Options”), each option to purchase shares of Company Common Stock (each, a “Company Stock Option”) outstanding immediately Immediately prior to the Effective Time, each outstanding option to purchase shares of Common Stock (an "Option") granted under each of the Company's 1998 Nonqualified Stock Option Plan for Ten Percent Shareholder-Directors; 1999 Stock Option Plan for Nonemployee Directors; and 2001 Nonqualified Stock Option Plan for Officers and Key Employees and any similar plan or arrangement providing for the issuance of options (collectively, the "Option Plans"), whether or not exercisedthen exercisable or vested, shall, by virtue of the Merger and without any action on the part of any holder of any Option, become fully exercisable and vested. At the Effective Time (A) each Option which is vested or which then outstanding shall be canceled and (B) in consideration of such cancellation, each Option shall be converted into the right to receive, as promptly as reasonably practicable following the Effective Time, a cash payment with respect thereto equal to the product of (x) the excess of the Merger Consideration over the exercise price thereof, if any, and (y) the number of shares of Common Stock subject thereto (such payment to be net of taxes required by its terms will become vested Law to be withheld with respect thereto). No payment shall be made with respect to any Option having a per share exercise price, as in effect at the Effective Time, equal to or greater than the Merger Consideration. In addition, all shares reserved for issuance under the Option Plans shall be canceled canceled. The cancellation of an Option as provided in this Section 2.4 shall be deemed a release of any and extinguished and converted into and become a right following all rights the Effective Time to receive from the Company an amount of cash, without interest thereon and less any required withholding taxes, equal to the excess, if any, of (i) the Merger Consideration over (ii) the exercise price per share of such Company Stock Option (such amount payable holder thereof had or may have in respect of any share of Company Common Stock into which a Company Stock Option is exercisable, the “Option Consideration”), multiplied by the number of shares of Company Common Stock for which such Company Stock Option is exercisable immediately prior to or at Option. Within five (5) business days after the Effective Time, and all other unvested Company Options (“Unvested Company Options”) will be cancelled without consideration. No cash payment will be Parent shall pay the aggregate amount due to a holder holders of such Options pursuant to this Section 2.4 to an account or accounts designated by the Company Stock Option in respect by wire transfer of such Company Stock Option or its termination if immediately available United States funds. Notwithstanding anything to the amount set forth in clause (ii) exceeds the amount set forth in clause (i). Prior contrary contained herein, prior to the Effective Time, the Company shall take any and all actions (including, without limitation, obtaining all necessary consents from the holders of Company Stock Options) necessary to give effect to the transactions contemplated by effectuate this Section 2.1(e), and payments to particular holders pursuant to this Section 2.1(e) shall be conditioned upon their execution of such consents. The Option Consideration shall be payable on the first Business Day following the Effective Time. All Executive Options listed in Schedule 2.1(e) and not exercised as of the Effective Time shall remain outstanding after the Effective Time and should be continued as options to purchase a number (or fraction) of shares of common stock of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) in a manner consistent with Section 409A of the Code, as determined in the sole discretion of Parent, and otherwise shall be governed by their existing terms2.4.

Treatment of Stock Options. Subject to Section 2.3, at (a) Effective as of the Effective Time, except for those options listed in Schedule 2.1(e) which are owned each option granted by the executive officers of the Company which have not been exercised at or prior to the Effective Time (the “Executive Options”), each option to purchase shares of Company Common Stock that is outstanding and unexercised immediately prior thereto (each, a “the "Company Stock Option”Options"), whether vested or unvested as of the Effective Time, shall cease to represent a right to acquire shares of Company Common Stock and shall be converted automatically into a fully vested and exercisable option to purchase shares of Parent Common Stock in an amount, at an exercise price and for an exercise period determined as provided below (and otherwise subject to the terms of the Company plans (the "Option Plans"), and the agreements evidencing grants thereunder). The number of shares of Parent Common Stock subject to, and the option price and terms and conditions of, the new option shall be determined in a manner that preserves both (i) outstanding the aggregate gain (or loss) on the Company Stock Option immediately prior to the Effective Time and (ii) the ratio of the exercise price per share subject to the Company Stock Option to the fair market value (determined immediately prior to the Effective Time) per share subject to such option, and not exercised, which is vested or which by its terms will become vested at the Effective Time, provided that any fractional shares of Parent Common Stock resulting from such determination shall be canceled and extinguished and converted into and become a right following the Effective Time to receive from the Company an amount of cash, without interest thereon and less any required withholding taxes, equal rounded down to the excess, if any, nearest share. Effective as of (i) the Merger Consideration over (ii) the exercise price per share of such Company Stock Option (such amount payable in respect of any share of Company Common Stock into which a Company Stock Option is exercisable, the “Option Consideration”), multiplied by the number of shares of Company Common Stock for which such Company Stock Option is exercisable immediately prior to or at the Effective Time, and all other unvested Company Options (“Unvested Company Options”) will be cancelled without consideration. No cash payment will be due to a holder of such Company Stock Option in respect of such Company Stock Option or its termination if the amount set forth in clause (ii) exceeds the amount set forth in clause (i). Prior to the Effective Time, the Company Surviving Corporation shall take all actions (including, without limitation, obtaining all necessary consents from the holders of assume each Company Stock Options) necessary Option agreement, each as amended, as provided herein. The adjustment provided herein with respect to give effect to any Company Stock Options that are "incentive stock options" (as defined in section 422 of the transactions contemplated by this Section 2.1(e), and payments to particular holders pursuant to this Section 2.1(eCode) shall be conditioned upon their execution and is intended to be effected in a manner that is consistent with section 424(a) of such consentsthe Code. The Option Consideration duration and other terms of the new options shall be payable on the same as the Company Stock Options that they replace, except that all references to the Company shall be deemed to be references to Parent; provided, however, that all such new options shall not expire until at least sixty (60) days after the end of the first Business Day following fiscal quarter of Parent ending at least thirty (30) days after the Effective Time. All Executive Options listed in Schedule 2.1(e) and not exercised as New option award agreements will be provided to each holder of the Effective Time shall remain outstanding new options within 30 days after the Effective Time and should be continued as options to purchase a number (or fraction) of shares of common stock of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) in a manner consistent with Section 409A of the Code, as determined in the sole discretion of Parent, and otherwise shall be governed by their existing termsTime.

Treatment of Stock Options. Subject Under the Merger Agreement, each option granted under Portec 2006 Stock Option Plan or under any other plan or agreement of Portec that is outstanding and unexpired immediately prior to Section 2.3, at the Effective Time, except for those options listed in Schedule 2.1(e) whether or not then vested or exercisable, with respect to which are owned by the executive officers Merger Consideration exceeds the exercise price per share will, effective as of the Company which have not been exercised at or immediately prior to the Effective Time Time, be cancelled in exchange for a single lump sum cash payment equal to the product of (1) the “Executive Options”), each option to purchase shares number of Company Common Shares subject to such option and (2) the excess of the Merger Consideration over the exercise price of such option (less any applicable withholding taxes). Each option granted under Portec 2006 Stock (each, a “Company Stock Option”) Option Plan or under any other plan or agreement of Portec that is outstanding immediately prior to the Effective Time, and whether or not exercised, which is then vested or exerciseable, with respect to which by its terms will become vested at the Effective Time, shall be canceled and extinguished and converted into and become a right following the Effective Time to receive from the Company an amount of cash, without interest thereon and less any required withholding taxes, equal to the excess, if any, of (i) the Merger Consideration over (ii) does not exceed the exercise price per share shall, effective as of such Company Stock Option (such amount payable in respect of any share of Company Common Stock into which a Company Stock Option is exercisable, the “Option Consideration”), multiplied by the number of shares of Company Common Stock for which such Company Stock Option is exercisable immediately prior to or at the Effective Time, and all other unvested Company Options (“Unvested Company Options”) will be cancelled without consideration. No cash payment will be due to a holder of such Company Stock Option in respect of such Company Stock Option or its termination if the amount set forth in clause (ii) exceeds the amount set forth in clause (i). Prior to the Effective Time, be cancelled and no payments shall be made with respect thereto. Notwithstanding the foregoing, (i) payment of any such lump sum cash amount is subject to written acknowledgement, in a form acceptable to the Surviving Corporation, that no further payment is due to such holder on account of any Company option and all of such holder’s rights under such Company options have terminated and (ii) with respect to any option holder subject to Section 16(a) of the Exchange Act, any amount to be paid to such person shall take all be paid as soon as practicable after the payment can be made without liability on such person’s part under Section 16(b) of the Exchange Act. Under the Merger Agreement, Xxxxxx’s board of directors (or, if appropriate, any committee administering Company stock plans) has represented to us that it has adopted such resolutions or taken such other actions (including, without limitation, obtaining all necessary consents from the holders of Company Stock Options) necessary as are required to give effect to the transactions contemplated by this Section 2.1(e)treatment of options and other rights described herein that were granted under Portec 2006 Stock Option Plan, and payments to particular holders pursuant to this Section 2.1(e) as amended. All amounts payable in connection with these options or rights shall be conditioned upon their execution subject to any required withholding of such consents. The Option Consideration taxes or proof of eligibility of exemption therefrom and shall be payable on paid without interest by the first Business Day Surviving Corporation as soon as practicable following the Effective Time. All Executive Options listed in Schedule 2.1(e) and not exercised as of the Effective Time shall remain outstanding after the Effective Time and should be continued as options to purchase a number (or fraction) of shares of common stock of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) in a manner consistent with Section 409A of the Code, as determined in the sole discretion of Parent, and otherwise shall be governed by their existing terms.

Treatment of Stock Options. Subject to Section 2.3, at the Effective Time, except for those options listed in Schedule 2.1(e) which are owned by the executive officers of the Company which have not been exercised at or prior to the Effective Time (the “Executive Options”), each Each option to purchase shares of Company Garfield Common Stock granted pursuant to the Garfield Stock Incentive Plans (as defined below) (each, a “Company Stock Option”) outstanding at the end of the day immediately before the Closing Date, whether or not vested or exercisable, shall, on the Closing Date prior to the Effective Time, be cancelled and the holder of such Stock Option shall be entitled to receive, in lieu of such cancelled Stock Option, an amount in cash, less any applicable Tax withholding, equal to the product of (i) the number of shares of Garfield Common Stock issuable upon the exercise of such Stock Option (the “Option Shares”) multiplied by (ii) the amount, if any, by which the Merger Consideration exceeds the per share exercise price of such Stock Option. Garfield will ensure that (i) the Garfield Stock Incentive Plans shall terminate as of the Effective Time and all awards issued under such plans shall be terminated and the provisions in any other plan, program, arrangement or agreement providing for the issuance or grant of any other interest in respect of the equity interests of Garfield or any of its subsidiaries shall be of no further force or effect and shall be deemed to be terminated as of the Effective Time, (ii) no holder of a Stock Option or any participant in any Garfield Stock Incentive Plan shall have any right thereunder to acquire any securities of Garfield, the Surviving Corporation or any subsidiary thereof or to receive any payment or benefit with respect to any award under a Garfield Stock Incentive Plan (except as provided above in this paragraph) and (iii) no holder of a Stock Option shall be permitted to exercise such Stock Option after the day that is two business days prior to the scheduled Closing Date. Garfield shall make such payments to the holders of such cancelled Stock Options on the Closing Date, immediately prior to the Effective Time. For purposes of this Agreement, and not exercised, which is vested or which by its terms will become vested at “Garfield Stock Incentive Plans” shall mean the Effective Time, shall be canceled and extinguished and converted into and become a right following the Effective Time to receive from the Company an amount of cash, without interest thereon and less any required withholding taxes, equal to the excess, if any, of (i) the Merger Consideration over (ii) the exercise price per share of such Company 1991 Incentive Stock Option (such amount payable in respect of any share of Company Common Stock into which a Company Plan, the 1994 Nonqualified Performance Option Plan, the 1996 Stock Option is exercisablePlan, the “Option Consideration”), multiplied by the number of shares of Company Common Stock for which such Company 1999 Stock Option is exercisable immediately Plan and the 2004 Stock Incentive Plan. Garfield shall take all actions necessary to effectuate the foregoing prior to or at the Effective Time, and all other unvested Company Options (“Unvested Company Options”) will be cancelled without consideration. No cash payment will be due to a holder of such Company Stock Option in respect of such Company Stock Option or its termination if the amount set forth in clause (ii) exceeds the amount set forth in clause (i). Prior to the Effective Time, the Company shall take all actions (including, without limitation, obtaining all necessary consents from the holders of Company Stock Options) necessary to give effect to the transactions contemplated by this Section 2.1(e), and payments to particular holders pursuant to this Section 2.1(e) shall be conditioned upon their execution of such consents. The Option Consideration shall be payable on the first Business Day following the Effective Time. All Executive Options listed in Schedule 2.1(e) and not exercised as of the Effective Time shall remain outstanding after the Effective Time and should be continued as options to purchase a number (or fraction) of shares of common stock of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) in a manner consistent with Section 409A of the Code, as determined in the sole discretion of Parent, and otherwise shall be governed by their existing terms.

Treatment of Stock Options. Subject to Section 2.31.10(h), at the Effective Time, except for those options listed in Schedule 2.1(e) which are owned by the executive officers of the each Company which have not been exercised at or prior to the Effective Time (the “Executive Options”), each option to purchase shares of Company Common Stock (each, a “Company Stock Option”) Option that is outstanding and unexercised immediately prior to the Effective Time, whether or not vested, shall become fully vested immediately prior to the Effective Time and not exercised, which is vested or which by its terms will become vested shall be cancelled at the Effective Time, Time and the holder thereof shall be canceled and extinguished and converted into and become a right following the Effective Time entitled to receive from the for each share of Company Common Stock subject to such Company Option (a) an amount of cash, without interest thereon and less any required withholding taxes, in cash equal to the excess, if any, of to: (i) the Merger Consideration over Residual Upfront Per Share Amount; minus (ii) the exercise price per share of such Company Stock Option (such amount payable in respect of any share of Company Common Stock into which a subject to such Company Stock Option is exercisable, Option; minus (iii) the “Option Consideration”), multiplied by Indemnification Escrow Contribution Amount per share of the number of shares of applicable Company Common Stock for which Stock; minus (iv) the Expenses Escrow Contribution Amount per share of the applicable Company Common Stock; plus (b) any cash disbursements required to be made from the Indemnification Escrow Fund with respect to such Company Stock Option is exercisable immediately prior share to or at the Effective Time, and all other unvested Company Options (“Unvested Company Options”) will be cancelled without consideration. No cash payment will be due to a former holder of such Company Stock Option in accordance with the Escrow Agreement, as and when such disbursements are required to be made; plus (c) any cash disbursements required to be made from the Expenses Escrow Fund with respect to such share to the former holder of such Company Stock Option or its termination if in accordance with the amount set forth Escrow Agreement, as and when such disbursements are required to be made; plus (d) any amounts required to be paid by Parent with respect to such share to the former holder thereof in clause (ii) exceeds accordance with the amount set forth in clause (i)terms of Section 1.7, as and when such payments are required to be made. Prior to the Effective Time, the Company shall take all actions action that may be necessary (including, without limitation, obtaining all necessary consents from under the holders Company Option Plan or otherwise) to effectuate the provisions of Company Stock Options) necessary to give effect to the transactions contemplated by this Section 2.1(e)1.6. and to ensure that, from and payments to particular holders pursuant to this Section 2.1(e) shall be conditioned upon their execution of such consents. The Option Consideration shall be payable on the first Business Day following after the Effective Time. All Executive Options listed , each holder of an outstanding Company Option cancelled as provided in Schedule 2.1(e) and not exercised as of this Section 1.6 shall cease to have any rights with respect thereto, except the Effective Time shall remain outstanding after right to receive the Effective Time and should be continued as options to purchase a number (or fraction) of shares of common stock of the Surviving Corporation that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) or converted into options to purchase a number (or fraction) of shares of common stock of Parent that corresponds to the percentage of the fully diluted equity of the Company represented by the shares underlying such options (and the exercise price thereof shall be adjusted accordingly) consideration specified in a manner consistent with this Section 409A of the Code, as determined in the sole discretion of Parent, and otherwise shall be governed by their existing terms1.6 without interest.