Common use of Options Clause in Contracts

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by the Company to purchase shares of Company Common Stock under (i) the Company's 1993 Incentive Stock Option Plan, (ii) the Company's 1993 Stock Option Plan for Non-Employee Directors and (iii) any other stock option plan or arrangement of the Company (collectively, the "Company Option Plans") which is outstanding and unexercised option (the "Company Options") exercisable for immediately prior thereto shall cease to represent a right to acquire shares of Company Common Stock and shall become fully vested be converted automatically into an option to purchase shares of Parent Common Stock in an amount and exercisable (by virtue at an exercise price determined as provided below, and otherwise subject to the terms of their terms) and Purchaser shall cause each holder of a the Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements Plans pursuant to which such Company Options were grantedoptions have been issued and the agreements evidencing grants thereunder: (i) except that The number of shares of Parent Common Stock to be subject to the exercise price and new option shall be equal to the product of the number of shares issuable upon exercise of Company Common Stock subject to the original option and the Exchange Ratio; provided that any fractional shares of Parent Common Stock resulting from such multiplication shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or numbershare; and (ii) The exercise price per share of Parent Common Stock under the new option shall be equal to the exercise price per share of Company Common Stock under the original option divided by the Exchange Ratio, respectively. Purchaser provided that such exercise price shall use all reasonable efforts be rounded down to ensure that the nearest whole cent. (b) The adjustment provided herein with respect to any Company Options that qualified as options which are "incentive stock options under options" (as defined in Section 422 of the Internal Revenue Code Code) shall be and is intended to be effected in a manner which is consistent with Section 424(a) of 1986, the Code. The duration and other terms of the new option shall be the same as amended the original option except that all references to the Company shall be deemed to be references to Parent. (c) Parent agrees to file with Securities and Exchange Commission (the "CodeSEC") prior to as soon as reasonably practicable after the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements statement on Form S-8 or other appropriate form as may be necessary in connection under the Securities Act of 1933 (together with the purchase rules and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent regulations thereunder, the "Securities Act") to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser register Parent Common Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement options under the Company ESPP shall continue, Option Plans and Company Shares shall be issued use its reasonable efforts to participants thereunder on cause such registration statement to remain effective until the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on exercise or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as expiration of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1options.

Options. (a) Except Purchase of Options by a Portfolio Upon the purchase by a Portfolio of any Option (as provided defined below), the Fund on behalf of the Portfolio shall promptly deliver to the Custodian a certificate signed by an appropriate officer of the Fund (a "Certificate") specifying with respect to each such Option: (i) whether the Option is a put or call Option; (ii) the name of the issuer of the securities subject to the Option and the title and number of such securities; (iii) the expiration date: (iv) the exercise price; (v) the date of purchase and settlement; (vi) the premium to be paid by the Portfolio; and (vii) the name of the registered broker-dealer who is acting as the clearing agent (the "Clearing Agent"). Upon receipt of a Clearing Agent's confirmation of the purchase of the Option held by such Clearing Agent for the account of Custodian as custodian for the Portfolio, Custodian shall pay the premium payable to the Clearing Agent through whom the purchase was made; provided, that such premium conforms to the total premium payable as set forth in paragraph such Certificate. (b) below Sale of Options by a Portfolio Upon the sale of any Option purchased by a Portfolio in accordance with subsection (a) above, the Fund on behalf of the Portfolio shall promptly deliver to Custodian a Certificate specifying with respect to such sale: (i) the Company's 1996 Employee Stock Purchase Plan, as amended type of Option (put or call); (ii) the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue name of the Merger and without any action on the part issuer of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements Option and the title and number of Section 16(asuch securities; (iii) the date of sale; (iv) the sales price; (v) the date of settlement; (vi) the total amount payable to the Portfolio upon such sale; and (vii) the name of the Securities Exchange Act Clearing Agent through whom the sale was made. Custodian shall consent to the delivery of the Option sold by the Clearing Agent which previously supplies the confirmation described in subsection (a) above with respect to such Option against payment to Custodian of the total amount payable to the Portfolio; provided that the same conforms to the total amount payable as set forth in such Certificate. (c) Upon the exercise by the Portfolio of any Call Option (as defined below) purchased by the Portfolio pursuant to subsection (a) above, the Fund on behalf of the Portfolio shall promptly deliver to Custodian a Certificate specifying with respect to such Call Option: (i) the name of the issuer of the securities subject to such Call Option and the title and number of such securities; (ii) the expiration date; (iii) the date of exercise and settlement; (iv) the exercise price per share; (v) the total amount to be exempt paid by the Portfolio upon such exercise; and (vi) the name of the Clearing Agent through whom such Call Option was exercised. Custodian shall, upon receipt of the securities underlying the Call Option which was exercised,(A) pay out of the moneys held for the account of the Portfolio the total amount payable to the Clearing Agent through whom the Call Option was exercised; provided that the same conforms to the total amount payable as set forth in such Certificate, and (B) delete the exercised Call Option from the application of Section 16(b) of the Securities Exchange Act, statements delivered to the extent permitted thereunderFund pursuant to Section 16 of this agreement. (bd) The current offerings in process Upon the exercise by a Portfolio of any Put Option (as defined below) purchased by the Portfolio pursuant to subsection (a) hereof, the Fund on behalf of the Portfolio shall deliver to Custodian a Certificate specifying with respect to such Put Option: (i) the name of the issuer of the securities subject to such Put Option and the title and number of such securities; (ii) the expiration date; (iii) the date of this Agreement under exercise and settlement; (iv) the Company ESPP exercise price per share; (v) the total amount to be paid to the Portfolio upon such exercise; and (vi) the name of the Clearing Agent through whom such Put Option was exercised. Custodian shall continueupon receipt of the amount payable upon the exercise of the Put Option (A) deliver or cause the Securities Depository or Book Entry Account to deliver, out of the account of the Portfolio to which such Put Option was allocated, the securities which were subject to such Put Option; provided that the same conforms to the amount payable to the Portfolio as set forth in such Certificate, and Company Shares (B) delete the exercised Put Option from the statements to be delivered to the Fund pursuant to Section 16 of this agreement. (e) Whenever a Portfolio writes a Covered Call Option (as defined below) with respect to securities held by Custodian hereunder, the Fund on behalf of the Portfolio shall promptly deliver to Custodian a Certificate specifying with respect to such Covered Call Option: (i) the name of the issuer of the securities subject to such Covered Call Option and the title and number of such securities; (ii) the expiration date; (iii) the exercise price; (iv) the premium to be issued to participants thereunder on received by the next currently scheduled purchase dates thereunder occurring after Portfolio; (v) the date hereof such Covered Call Option was written; and (vi) the name of the Clearing Agent through whom the premium is to be received. Custodian shall deliver or cause to be delivered, in exchange for receipt of the premium specified in the Certificate with respect to such Covered Call Option, such receipts as provided underare required in accordance with the customs prevailing among brokers in Covered Call Options, and shall impose, or direct the Securities Depository or Book Entry Account to impose, upon the underlying securities specified in the Certificate such restrictions as may be required by such receipts. (f) Whenever Covered Call Option written by a Portfolio and described in the preceding subsection (e) is exercised, the Fund on behalf of the Portfolio shall promptly deliver to Custodian a Certificate instructing Custodian to deliver, or to direct the Securities Depository or Book Entry Account to deliver, the securities subject to such Covered Call Option and specifying: (i) the terms name of the issuer of the securities subject to such Covered Call Option and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under title and number of such securities; (ii) the Company ESPP on or after Clearing Agent to whom the date hereof underlying securities are to be delivered; and prior (iii) the total amount payable to the Effective Time at an exercise price for each Portfolio upon such offering not less than as is required under delivery. Upon the Company ESPP. Immediately prior to the Effective Time, return and/or cancellation of any receipts delivered pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(asubsection (e) hereof, plus Custodian shall deliver, or cause the cash value Securities Depository or Book Entry Account to deliver, the underlying securities as specified in the Certificate for the amount to be received as set forth in such Certificate. (g) Whenever a Portfolio purchases any Option identical to a previously written Covered Call Option described in subsection (e) hereof in a transaction expressly designated as a "Closing Purchase Transaction" in order to liquidate its position as a writer of an Option, the Fund on behalf of the Portfolio shall promptly deliver to Custodian a Certificate specifying with respect to the Option being purchased: (i) that the transaction is a Closing Purchase Transaction; (ii) the name of the issuer of the securities subject to such Option and the title and number of such securities; (iii) the exercise price; (iv) the premium to be paid by the Portfolio; (v) the expiration date; (vi) the date of such purchase; and (vii) the name of the Clearing Agent to whom the premium is to be paid. Upon Custodian's payment of the premium and the return and/or cancellation of any fraction receipt issued pursuant to subsection (e) of this Section 14 with respect to the Covered Call option being liquidated through the Closing Purchase Transaction, Custodian shall (A) remove, or direct the Securities Depository or Book Entry Account to remove, the previously imposed restriction on the securities underlying the Covered Call Option, and (B) delete such Option from statements delivered to the Fund by Custodian pursuant to Section 16 of this agreement. (h) Upon the expiration of any Option purchased by a share Portfolio pursuant to subsection (a) of Purchaser Common Stock this Section 14 or any Covered Call Option written by a Portfolio and described in subsection (e) of this Section 14, Custodian shall (i) delete such Option from the statements delivered to the Fund pursuant to Section 16 of this agreement and, if such expired Option was a Covered Call Option written by the Portfolio, (ii) free, or instruct the Securities Depository or Book Entry Account to free, the Securities underlying such Covered Call Option from the restrictions imposed by receipts issued in connection therewith. (i) For purposes of this Section 14, the following terms shall have the meanings as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.set forth below:

Options. (a) Except as Unless otherwise provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Planapplicable Agreement, as amended (the "Company ESPP")if, at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue date that an Option first becomes exercisable, a Participant's status as an Employee and Non-Employee Director is terminated for any reason, the Participant's right to so qualify after exercise the Effective Time. Purchaser Option shall take terminate and all corporate action necessary to reserve for issuance a sufficient number rights thereunder shall cease as of shares the close of Purchaser Stock for delivery upon business on the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness date of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereundertermination. (b) The current offerings For any Nonqualified Stock Option unless otherwise provided in process as of the date of this applicable Agreement under the Company ESPP shall continueand for any Incentive Stock Option, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided underif, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof that the Option first becomes exercisable, a Participant's status as an Employee and prior Non-Employee Director is terminated (1) for Cause, any unexercised portion of the Option (whether then exercisable or not) shall, as of the time of the Cause determination, immediately terminate, (2) due to death or Disability, then the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective TimeOption, to the extent that it is exercisable on the date of payroll deductions accumulated by such participant as termination, shall be exercisable only until the earlier of the one year anniversary of such offering period endtermination or the "expiration date" set forth in the applicable Agreement, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger (3) for any other reason (except as provided in Section 1.3(a) hereofthe next sentence), plus then the cash value Option, to the extent that it is exercisable on the date of termination, shall be exercisable only until the earlier of the three month anniversary of such termination or the "expiration date" set forth in the applicable Agreement. For any Nonqualified Stock Option, unless otherwise provided in the applicable Agreement, if, on or after the date that the Option first becomes exercisable, a Participant's status as an Employee and Non- Employee Director is terminated due to Retirement, or if a Participant is a party to a Change in Control Agreement with the Company and such Participant's status as an Employee and Non-Employee Director is terminated involuntarily or constructively in accordance with paragraph 3 thereof, then the Option, to the extent that it is exercisable on the date of termination, shall be exercisable until the "expiration date" set forth in the applicable Agreement. The Board, at its discretion, may designate in the applicable Agreement a different post- termination period for exercise of a Nonqualified Stock Option and may extend the exercise period of any fraction Option, but in no event may the post-termination exercise period exceed the tenth anniversary of the Grant Date; it being understood that the extension of the exercise term for an Incentive Stock Option may cause such Option to become a share Nonqualified Stock Option. (c) Shares subject to Options that are not exercised within the time allotted for exercise shall expire and be forfeited by the Participant as of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1the close of business on the date they are no longer exercisable.

Options. (a) Except as 6.1 The Committee is hereby authorized to grant Incentive Stock Options and Nonstatutory Stock Options to any employee who is an Eligible Person and to grant Nonstatutory Stock Options to any Director, provided that the number of Options granted to an Eligible Person during a fiscal year will not exceed the applicable limitations set forth in paragraph (b) below Article 5 of this Plan when aggregated with other Awards made to that Eligible Person during that fiscal year. 6.2 All Options will be evidenced by an Agreement. All Agreements granting Incentive Stock Options will contain a statement that the Option is intended to be an Incentive Stock Option; if no such statement is included in the Agreement, or if the Agreement affirmatively states that the Option is intended to be a Nonstatutory Stock Option, the Option shall be a Nonstatutory Stock Option. 6.3 All Agreements shall specify the number of Class A Common Shares or Class B Common Shares to which it pertains subject to the limitations set forth in Article 5 of this Plan. 6.4 The Option Period will be determined by the Committee and specifically set forth in the Agreement, provided that an Option will not be exercisable after ten years from the Grant Date. 6.5 The Committee will, at or after the Grant Date, determine the methods by which the Option Price of an Option may be paid and the form or forms of payment that may be permitted. 6.6 The Committee may provide in the Agreement evidencing the grant of an Option that the Committee, in its sole discretion, will have the right to substitute an Appreciation Right for such Option at any time prior to or upon exercise of such Option; provided, however, that such Appreciation Right will be exercisable with respect to the Company's 1996 Employee same number of Shares for which such substituted Option would have been exercisable. 6.7 The Committee may provide in the Agreement evidencing a grant of Options (other than Incentive Stock Purchase Options) that the Committee, in its sole discretion, will have the right to provide for the payment of Dividend Equivalents to the Optionee on either a current, deferred, or contingent basis or may provide that such equivalents shall be credited against the Option Price. 6.8 The exercise of an Option shall result in the cancellation on a share-for-share basis of any Related Right authorized under Article 8 of this Plan. 6.9 Except as otherwise determined by the Committee and set forth in an Agreement, as amended (if a Director subsequently becomes an employee of the "Company ESPP")Corporation or a Subsidiary while remaining a member of the Board, any Options held under the Plan by such individual at the Effective Timetime of such commencement of employment shall not be affected thereby. If an employee who is also a Director terminates employment, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary Awards granted in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) individual’s employment will continue to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, governed by and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, Plan and each participant shall receive the Agreement regarding a cash payment equal to the balance, if any, termination of such accumulated payroll deductions remaining after such purchase employment. 6.10 All other terms of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased Options granted under the Company ESPP have been converted pursuant to Plan will be determined by the Merger as provided Committee in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1its sole discretion.

Options. (a) Except as provided may be otherwise agreed in paragraph writing between the Company and any holder of any Option (b) below with respect as hereinafter defined), upon the consummation of the Merger, each option to acquire Company Common Stock outstanding immediately prior to the Effective Time under the Company's 1996 Employee Stock Purchase 1994 Executive Incentive Plan, as amended (the "Company ESPPExecutive Incentive Plan"), at the Effective TimeCompany's 1997 Stock Incentive Plan, each then outstanding and unexercised option (as amended, the "Company Options") exercisable for shares of Company Company's 1994 Executive Performance Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986Award Plan, as amended (the "CodeExecutive Performance Plan"), the Company's 1987 Non-Qualified Stock Option Plan, as amended and the Company's Stock Option Plan for Non-Employee Directors, as amended (such plans referred to herein as the "Option Plans"), whether vested or unvested (each, an "Option," collectively, the "Options"), shall automatically become immediately vested and exercisable and each holder of an Option shall have the right to receive from the Surviving Corporation a cash payment (less applicable federal, state and local withholding taxes) prior in an aggregate amount equal to the Effective Time continue difference, if any, between the Price Per Share less the applicable exercise price per share of Company Common Stock applicable to so qualify after such Option for all Company Common Stock subject to the Effective TimeOption as expressly stated in the applicable Option Plan, stock option agreement or other agreement. Purchaser Options with an exercise price equal to or greater than the Price Per Share will be cancelled without any consideration. The Company shall take all corporate action necessary use its reasonable best efforts (including, without limitation, giving requisite notices to reserve for issuance a sufficient number holders of shares Options advising them of Purchaser Stock for delivery upon such accelerated vesting and rights pursuant to this Section 1.10) to fully advise holders of Options of their rights under this Agreement and the Options, to facilitate their timely exercise of Purchaser Replacement Options after such rights and to effectuate the Effective Timeprovisions of this Section 1.10. Promptly From and after the Effective Time, Purchaser other than as expressly set forth in this Section 1.10, no holder of an Option shall file have any other rights in respect thereof other than to receive payment for his or cause to be filed all registration statements on Form S-8 or other appropriate form her Options as may be necessary set forth in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Timethis Section 1.10, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors Company shall take all necessary actions necessary on the part to terminate effective as of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange ActCompany's Option Plans, to the extent permitted thereunderstock option agreements and similar arrangements. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided in paragraph (b) below with respect ▇▇▇▇▇▇▇ hereby grants to ▇▇▇▇▇▇, on the Company's 1996 Employee Stock Purchase Planterms and conditions set forth herein, as amended a continuing right (the "Company ESPP")“Series B Common Stock Option”) to purchase from ▇▇▇▇▇▇▇, at the Effective Timetimes set forth herein, each then outstanding and unexercised option (the "Company Options") exercisable for such number of shares of Company Series B Common Stock as is necessary to allow the ▇▇▇▇▇▇ Entities to maintain the percentage of the then-outstanding Common Stock of ▇▇▇▇▇▇▇ that is equal to the Ownership Percentage. The Series B Common Stock Option shall become fully vested be assignable, in whole or in part and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option from time to receivetime, by virtue of ▇▇▇▇▇▇ to any ▇▇▇▇▇▇ Entity. The exercise price for the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Series B Common Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options purchased pursuant to the plans Series B Common Stock Option shall be the Market Price of the Series A Common Stock as of the date of first delivery of notice of exercise of the Series B Common Stock Option by ▇▇▇▇▇▇ (or arrangements pursuant its permitted assignee hereunder) to which such Company Options were granted) except ▇▇▇▇▇▇▇; provided, however, that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded at least equal to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 aggregate par value of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Series B Common Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderpurchased thereby. (b) The current offerings in process as provisions of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date Section 2.1(a) hereof as provided under, and subject to the terms and conditions ofnotwithstanding, the Company ESPP. The Company maySeries B Common Stock Option granted pursuant to Section 2.1(a) shall not apply and shall not be exercisable in connection with the issuance by ▇▇▇▇▇▇▇ of any shares of Common Stock pursuant to any stock option or other executive or employee benefit or compensation plan maintained by ▇▇▇▇▇▇▇, consistent with past practiceso long as, commence new offering periods under the Company ESPP on or from and after the date hereof and prior to the Effective Time issuance of such shares, ▇▇▇▇▇▇▇ has repurchased from shareholders and not subsequently reissued a number of shares equal or greater to the number of shares to be issued in any such issuance. (c) ▇▇▇▇▇▇▇ hereby grants to ▇▇▇▇▇▇, on the terms and conditions set forth herein, a continuing right (the “Nonvoting Stock Option” and, together with the Series B Common Stock Option, the “Options”) to purchase from ▇▇▇▇▇▇▇, at an the times set forth herein, such number of shares of Nonvoting Stock as is necessary to allow the ▇▇▇▇▇▇ Entities to own eighty percent (80%) of each class of outstanding Nonvoting Stock. The Nonvoting Stock Option shall be assignable, in whole or in part and from time to time, by ▇▇▇▇▇▇ to any ▇▇▇▇▇▇ Entity. The exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, shares of Nonvoting Stock purchased pursuant to the Company ESPP, all offerings under the Company ESPP Nonvoting Stock Option shall be terminatedthe price at which such Nonvoting Stock is then being sold to third parties, and each participant or, if no Nonvoting Stock is being sold, the fair market value thereof as determined in good faith by the Board of Directors of ▇▇▇▇▇▇▇; provided, however, that the exercise price shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment least equal to the balance, if any, aggregate par value of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Nonvoting Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1thereby.

Options. (a) Except as provided in paragraph (b) below with respect Blockbuster hereby grants to Viacom International, on the Company's 1996 Employee Stock Purchase Planterms and conditions set forth herein, as amended a continuing right (the "Company ESPPBLOCKBUSTER CLASS B COMMON STOCK OPTION")) to purchase from Blockbuster, at the Effective Timetimes set forth herein, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Blockbuster Class B Common Stock as is necessary to allow the Viacom International to maintain the Ownership Percentage. The exercise price for the shares of Blockbuster Class B Common Stock purchased pursuant to the Blockbuster Class B Common Stock Option shall be the Market Price of the Blockbuster Class A Common Stock as of the date of first delivery upon the of notice of exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause Blockbuster Class B Common Stock Option by Viacom International to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderBlockbuster. (b) The current offerings in process as provisions of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date Section 7.01(a) hereof as provided under, and subject to the terms and conditions ofnotwithstanding, the Company ESPP. The Company mayBlockbuster Class B Common Stock Option granted pursuant to Section 7.01(a) shall not apply and shall not be exercisable in connection with the issuance by Blockbuster of any shares of Blockbuster Common Stock pursuant to any stock option or other executive or employee benefit or compensation plan maintained by Blockbuster, consistent with past practiceso long as, commence new offering periods under the Company ESPP on or from and after the date hereof and prior to the Effective Time issuance of such shares, Blockbuster or Viacom International has repurchased from shareholders and Blockbuster has not subsequently reissued a number of shares equal or greater to the number of shares to be issued in any such issuance. (c) Blockbuster hereby grants to Viacom International, on the terms and conditions set forth herein, a continuing right (the "NONVOTING STOCK OPTION" and, together with the Blockbuster Class B Common Stock Option, the "OPTIONS") to purchase from Blockbuster, at an the times set forth herein, such number of shares of Nonvoting Stock as is necessary to allow the Viacom International to own 80 percent of each class of outstanding Nonvoting Stock. The exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, shares of Nonvoting Stock purchased pursuant to the Company ESPP, all offerings under the Company ESPP Nonvoting Stock Option shall be terminatedthe price at which such Nonvoting Stock is then being sold to third parties, and each participant shall be deemed to have purchased immediately prior to the Effective Timeor, to the extent of payroll deductions accumulated by such participant as of such offering period endif no Nonvoting Stock is being sold, the number of whole shares of Company Stock at a per share price fair market value thereof as determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, in good faith by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1an independent investment advisor.

Options. The Parties acknowledge and agree that one hundred eighty three thousand three hundred thirty-three (a183,333) Except shares of Common Stock subject to Option 1 have vested as provided in paragraph of the Resignation Date, zero (b0) below shares of Common Stock subject to Option 2 have vested as of the Resignation Date, and zero (0) shares of Common Stock subject to Option 3 have vested as of the Resignation Date. The Parties hereby agree that no further shares will vest under the Options from and after the Resignation Date. The vested portion of Option 1 will remain outstanding following the Resignation Date and will continue to be subject to the terms and conditions of the Plan and the applicable Option Agreement. Option 2 and Option 3 will cease to exist and be cancelled and Employee will have no further rights with respect to the Company's 1996 Employee Stock Purchase Plan, Option 2 and Option 3. The portion of Option 1 that has not vested as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger Resignation Date will cease to exist and without any action on the part be cancelled and Employee will have no further rights with respect to such unvested portion of Option 1. Employee will continue to be a Service Provider for purposes of the holder thereofPlan and the Option Agreements, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant Consulting Agreement. The Company shall provide written notice to which such Company Options were grantedEmployee not more than five (5) except business days after Employee ceases to be a Service Provider for purposes of the Plan and Option Agreements; provided, however, that the exercise price Company shall have no obligation to provide such notice when Employee ceases to be a Service Provider for purposes of the Plan and Option Agreements because the number Consulting Agreement expires by its own terms. Employee acknowledges that if any of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified have been classified as “incentive stock options under options” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended amended, such Options will convert into nonstatutory stock options three (the "Code"3) prior to the Effective Time continue to so qualify months and one (1) day after the Effective TimeResignation Date. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon Furthermore, Employee acknowledges that in the exercise of Purchaser Replacement event the Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form are classified as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary nonstatutory stock options on the part of Purchaser to enable date such Options are exercised, the acquisition of Purchaser Stock, Purchaser Replacement Options income recognized upon such exercise will be considered wages that must be reported on Employee’s W-2 and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to applicable tax withholding will be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under required. Employee agrees that the Company ESPP shall continue, and Company Shares shall be issued may refuse to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an process any such exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant until Employee has made arrangements satisfactory to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by satisfy any such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1withholding obligations.

Options. Firstar shall take action to amend the Firstar Stock Plans (aas defined herein) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP")so that, at the Effective Time, each then option granted by Firstar to purchase shares of Firstar Common Stock which is outstanding and unexercised option (the "Company Options") exercisable for immediately prior thereto shall cease to represent a right to acquire shares of Company Firstar Common Stock and shall become fully vested be converted automatically into an option to purchase shares of Firstar (WI) Common Stock in an amount and exercisable at an exercise price determined as follows (by virtue of their terms) and Purchaser shall cause each holder of a Company Option otherwise subject to receive, by virtue the terms of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock appropriate Firstar Benefit Plan ("Purchaser Replacement Options"as defined herein) having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were grantedoptions have been granted (such plans collectively the "Firstar Stock Plans") except that and the exercise price and agreements evidencing grants thereunder): (i) the number of shares issuable upon exercise of Firstar (WI) Common Stock to be subject to the new option shall be divided equal to the product of the number of shares of Firstar Common Stock subject to the original option and multipliedthe Exchange Ratio, respectively, by the Conversion Fraction, and provided that any fractional shares of Firstar (WI) Common Stock resulting from such multiplication shall be rounded down to the nearest whole cent or numbershare and (ii) the exercise price per share of Firstar (WI) Common Stock under the new option shall be equal to the exercise price per share of Firstar Common Stock under the original option divided by the Exchange Ratio, respectivelyprovided that such exercise price shall be rounded down to the nearest whole cent. Purchaser shall use all reasonable efforts The adjustment provided herein with respect to ensure that any Company Options that qualified as options which are "incentive stock options under options" (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code")) prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause be and is intended to be filed all registration statements on Form S-8 or other appropriate form as may be necessary effected in connection a manner which is consistent with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a424(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) Code. The duration and other terms of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares new option shall be issued the same as the original option except that all references to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant Firstar shall be deemed to have purchased immediately prior be references to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Firstar (WI).

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by CCB to purchase shares of CCB Common Stock which is outstanding and unexercised option (the "Company Options") exercisable for immediately prior thereto shall cease to represent a right to acquire shares of Company CCB Common Stock and shall become fully vested be converted automatically into an option to purchase shares of NCBC Common Stock in an amount and exercisable at an exercise price determined as provided below (by virtue and otherwise subject to the terms of their termsthe CCB Stock Plans (as defined below) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant grants thereunder): (i) The number of shares of NCBC Common Stock to be subject to the plans or arrangements pursuant new option shall be equal to which such Company Options were granted) except that the exercise price and product of the number of shares issuable upon exercise of CCB Common Stock subject to the original option and the Exchange Ratio, provided that any fractional shares of NCBC Common Stock resulting from such multiplication shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or numbershare; and (ii) The exercise price per share of NCBC Common Stock under the new option shall be equal to the exercise price per share of CCB Common Stock under the original option divided by the Exchange Ratio, respectively. Purchaser provided that such exercise price shall use all reasonable efforts be rounded to ensure that the nearest whole cent. (c) The adjustment provided herein with respect to any Company Options that qualified as options which are "incentive stock options under options" (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser )), shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause be and is intended to be filed all registration statements on Form S-8 or other appropriate form as may be necessary effected in connection a manner which is consistent with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a424(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) Code. The duration and other terms of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares new option shall be issued the same as the original option except that all references to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant CCB shall be deemed to have purchased immediately prior be references to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1NCBC.

Options. (a) Except Each of the Stockholders hereby grants to Sub an irrevocable option (each, a "Purchase Option" and collectively, the "Purchase Options") to purchase the number of Shares set forth opposite such Stockholder's name on Schedule I hereto together with all of the Shares (including any additional Shares that may be issuable as provided in paragraph a result of a "change of control") Beneficially Owned by such Stockholder as a result of the Stockholder's exercise of the Options set forth opposite such Stockholder's name on Schedule II hereto (bcollectively, with the Shares described on Schedule I, the "Option Shares") below with respect at a purchase price per share equal to the Company's 1996 Employee Stock Purchase PlanPrice. Subject to the last sentence of this Section 3(a), each Purchase Option is currently exercisable in whole but not in part, and shall remain exercisable in whole but not in part until 5:00 p.m. (Dallas, Texas time) on the date which is 120 days after a Termination Event (the "Option Period"), so long as: (i) all waiting periods under the Hart-▇▇▇▇▇-▇▇▇▇▇▇ ▇▇▇itrust Improvements Act of 1976, as amended (the "Company ESPPHSR Act"), at required for the Effective Timepurchase by Sub of the Option Shares upon such exercise shall have expired or been waived, each then outstanding and unexercised option (ii) there shall not be in effect any preliminary or final injunction or other order issued by any court or governmental, administrative or regulatory agency or authority prohibiting the exercise of the Purchase Options pursuant to this Agreement. The Option Period shall be extended for the time period that any such preliminary injunction or order shall be in effect that otherwise prohibits the exercise of a Purchase Option. To exercise the Purchase Options, Sub shall send a written notice (the "Company OptionsNotice") exercisable to the Stockholders identifying the place and date (not less than one nor more than 20 business days from the date of the Notice) for shares the closing of Company Stock such purchase. The Sub shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder not exercise the Purchase Options prior to the occurrence of a Company Option to receive, by virtue Termination Event. (b) Upon receipt of the Merger and without any action on Notice to the part extent not previously exercised, contemporaneously with the closing of the holder thereofpurchase of the Option Shares, options exercisable each Stockholder shall exercise in full the Options set forth opposite such Stockholder's name on Schedule II hereto. Subject to Section 2(d), for shares convenience purposes, in connection with such exercise of Purchaser Stock ("Purchaser Replacement the Options") having the same terms and conditions as , each Stockholder hereby gives the Company irrevocable notice of the exercise of his Options (including such terms and conditions as may be incorporated by reference into effective contemporaneously with the agreements evidencing closing of the Company Options purchase of the Option Shares pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price Purchase Option and the number Company hereby acknowledges the effectiveness of shares such exercise. Each Stockholder also hereby irrevocably instructs the Company to issue (and the Company hereby agrees to issue) the Shares issuable upon such exercise in the name of Sub or its permitted assignee (and Sub or its permitted assignee shall be divided deemed the record owner thereof as of the date of such exercise so long as Sub or its permitted assignee timely tenders payment of the Purchase Price as provided herein) and multipliedSub hereby agrees, respectivelyon behalf of each Stockholder, by the Conversion Fraction, and rounded to pay directly to the nearest whole cent Company (by means of wire transfer or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"official bank check) prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form such amount as may be necessary in connection to fund the payment of the exercise price (without regard to any applicable withholding taxes) due and payable to the Company as a result of such exercise (with the purchase aggregate amount of the Purchase Price due and sale payable to each Stockholder (or his designee) being reduced by the amount of Purchaser Stock contemplated any such payment made by Sub on behalf of such Purchaser Replacement Options subsequent Stockholder and with the remaining amount of the Purchase Price otherwise due and payable to each Stockholder being paid directly to such Stockholder, as may be requested by the Company, net of any applicable withholding taxes required to be paid to the Effective TimeCompany, by means of wire transfer or official bank check). Such payments to the Company (including such requested withholding taxes) and the Stockholders shall maintain be made contemporaneously with the effectiveness of such registration statements (and maintain the current status exercise of the prospectus or prospectuses contained therein) for so long as any Purchase Options and the delivery of the Purchaser Replacement Options registered thereunder remain outstanding. As soon Option Shares thereunder, provided, that as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons any Stockholder subject to the reporting requirements of Section 16(a) of the Securities Exchange Act Act, payment to such Stockholder of any portion of the Purchase Price will be deferred (as defined belowif necessary to avoid Section 16(b) liability) until the first date such payment can be made without liability to be exempt from the application of such Stockholder under Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderbut shall be paid as soon as practicable thereafter. (bc) The current offerings in process as of In the event that Sub has purchased the Option Shares pursuant to the Purchase Options, and, within one year after the date of this Agreement under such purchase, the Company ESPP Sub or any affiliate thereof sells, transfers, exchanges or disposes of any of the Option Shares in a transaction with a non-affiliate of Sub (a "Disposition") then, within two business days after the closing of such Disposition, Sub shall continuetender and pay to each Stockholder, and Company Shares shall be issued to participants thereunder in immediately available funds, their respective pro-rata share (calculated based on the next currently scheduled purchase dates thereunder occurring after respective amount of the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for Option Shares purchased from each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, Stockholder pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent Purchase Options) of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions 25% of the Company ESPPNet Profit realized by Sub in connection with such Disposition. As used in this Section 3(c), and each participant Net Profit shall receive a cash payment mean an amount equal to (i) the balanceexcess, if any, of the gross amount realized by Sub from a Disposition over (ii) the aggregate Purchase Price paid with respect to the Option Shares subject to such accumulated payroll deductions remaining after Disposition, with such purchase excess being reduced by the sum of (A) all reasonable out-of-pocket fees, costs and expenses incurred by Sub and its affiliates in connection with such Disposition, (including, without limitation, all fees, costs and expenses of counsel) which in no event shall exceed 1% of such sharesNet Profit, and (B) all customary brokerage fees and commissions, if any, incurred in connection with such Disposition. (d) In the event that within the Option Period a Stockholder sells, transfers, exchanges, cancels or disposes of any of his Option Shares or Options in connection with or as a result of an Acquisition Proposal (an "Alternative Disposition") other than pursuant to Section 2 then, within two business days after the closing of such Alternative Disposition, such Stockholder shall tender and pay to Sub, in immediately available funds, its pro-rata share of 75% of the Net Profit realized by such Stockholder in connection with such Alternative Disposition. As used in this Section 3(d), Net Profit shall mean (i) in the case of outstanding Option Shares, an amount equal to the Effective Timeexcess, each participant shall receiveif any, of (A) the gross amount realized by virtue such Stockholder from an Alternative Disposition of outstanding Option Shares, over (B) the Merger, product of (x) the number of whole shares such Option Shares subject to such Alternative Disposition, multiplied by (y) the Purchase Price and (ii) in the case of Purchaser Stock or cash into Options, an amount equal to the excess, if any, of (A) the product of (x) the gross underlying per Share price otherwise paid in the Alternative Disposition and used in calculating the amount so realized by such Stockholder with respect to such Options in connection with such Alternative Disposition, multiplied by (y) the number of Option Shares subject to such Options, over (B) the product of (x) the number of Option Shares subject to such Options, multiplied by (y) the Purchase Price, with the aggregate of such excesses being reduced by the sum of (1) all reasonable out-of-pocket fees, costs and expenses incurred by such Stockholder in connection with such Alternative Disposition, (including, without limitation, all fees, costs and expenses of counsel, but excluding any withholding taxes) which in no event shall exceed 1% of such Net Profit, and (2) all customary brokerage fees and commissions, if any, incurred in connection with such Alternative Disposition. (e) As may be requested by Sub subsequent to a Termination Event but prior to the shares expiration of Company Stock such participant has so purchased under the Company ESPP have been converted Option Period each Stockholder shall tender his Shares as set forth on Schedule I hereto pursuant to any tender offer being made (at a per Share price greater than the Merger as provided Purchase Price) in connection with an Acquisition Proposal. (f) The Purchase Options shall terminate in full upon the consummation of the transactions (including, the tendering of all payments to be made thereunder) contemplated by Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 12.

Options. (a) Except as provided in paragraph (b) below with respect A. Subject to the Company's 1996 Employee Stock Purchase provisions of this Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock Committee is hereby authorized to grant Options to Employees. B. All Agreements granting Options shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of contain a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except statement that the exercise price Option is intended to be a nonstatutory stock option and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as not an incentive stock options under Section option as defined in section 422 of the Internal Revenue Code Code. C. The Option Period shall be determined by the Committee and specifically set forth in the Agreement, provided, however, that an Option shall not be exercisable before six months from the Date of 1986Grant (except that this limitation need not apply in the event of the death of the Optionee within the six-month period) and no Option shall be exercisable after ten years after the Date of Grant. D. By accepting the grant of an Option under the Plan, each Optionee agrees, for the Optionee and his or her successors, that the Option may not be exercised at any time that the Corporation does not have in effect a registration statement under the Securities Act of 1933, as amended (the "Code") prior amended, relating to the Effective Time continue offer of Common Stock to so qualify after the Effective Time. Purchaser shall take all corporate action necessary Optionee under the Plan, unless the Corporation agrees to reserve for permit such exercise, and that, upon the issuance a sufficient number of shares of Purchaser Stock for delivery any Shares upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after Option, the Effective TimeOptionee will, Purchaser shall file upon the request of the Corporation, agree in writing that he or cause she is acquiring such Shares for investment only and not with a view to be filed all registration statements on Form S-8 resale, and that he or other appropriate form as may be necessary in connection she will not sell, pledge or otherwise dispose of such Shares so issued unless and until (i) the Corporation is furnished with the purchase and sale an opinion of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent counsel to the Effective Time, and shall maintain the effectiveness effect that registration of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time Shares pursuant to Purchaser Replacement Options the Securities Act of 1933, as amended, is not required by persons subject to that Act and the reporting requirements of Section 16(arules and regulations thereunder; (ii) the staff of the Securities and Exchange Act Commission has issued a "no-action" letter with respect to such disposition; or (iii) such registration or notification as defined below) is, in the opinion of counsel for the Corporation, required for the lawful disposition of such Shares has been filed by the Corporation and has become effective; provided, however, that the Corporation shall not be obligated to file any such registration or notification. The Option shall further agree that the Company may place a legend embodying such restriction on the certificates evidencing such shares. E. All other terms of Options granted under the Plan shall be exempt determined by the Committee in its sole discretion, as exercised consistently with the terms of the Plan, and specifically set forth in the Optionee's agreement. Any terms of Options determined by the Committee that vary from the application of Section 16(b) of express terms set forth in the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares Plan also shall be issued to participants thereunder on specifically set forth in the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Optionee's Agreement.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for to purchase shares of Company FWB Common Stock under the FWB Stock Plans (each, a "FWB Stock Option"), whether vested or unvested, shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option be converted into an option to receiveacquire, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including were applicable under such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and FWB Stock Option, the number of shares issuable upon exercise shall be divided and multipliedof SFG Common Stock equal to (i) the number of shares of FWB Common Stock subject to the FWB Stock Option, respectively, multiplied by (ii) the Conversion Fraction, and Exchange Ratio (such product rounded to the nearest whole cent or number) (a "Replacement Option"), respectivelyat an exercise price per share (rounded to the nearest whole cent) equal to (y) the aggregate exercise price for the shares of FWB Common Stock which were purchasable pursuant to such FWB Stock Option divided by (z) the number of full shares of SFG Common Stock subject to such Replacement Option in accordance with the foregoing. Purchaser shall use all reasonable efforts Notwithstanding the foregoing, each FWB Stock Option which is intended to ensure that any Company Options that qualified as be an "incentive stock options under option" (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary adjusted in connection accordance with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) 424 of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPPCode. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on At or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, FWB shall use its best efforts, including using its best efforts to obtain any necessary consents from optionees, with respect to the FWB Stock Plans to permit the replacement of the outstanding FWB Stock Options by SFG pursuant to this Section and to permit SFG to assume the Company ESPP, FWB Stock Plans. FWB shall further take all offerings under action necessary to amend the Company ESPP shall be terminated, and each participant shall be deemed FWB Stock Plans to have purchased immediately prior to eliminate automatic grants or awards thereunder following the Effective Time. At the Effective Time, to SFG shall assume the extent of payroll deductions accumulated by FWB Stock Plans; provided, that such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions assumption shall be only in respect of the Company ESPP, Replacement Options and each participant that SFG shall receive a cash payment equal have no obligation with respect to any awards under the balance, if any, of FWB Stock Plans other than the Replacement Options and shall have no obligation to make any additional grants or awards under such accumulated payroll deductions remaining assumed FWB Stock Plans. (b) At all times after such purchase of such shares. As of the Effective Time, each participant SFG shall receive, by virtue of the Merger, the reserve for issuance such number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser SFG Common Stock as provided necessary so as to permit the exercise of the Replacement Options in Section 1.5(h) hereof, plus any dividends or distributions the manner contemplated by this Agreement and the instruments pursuant to which the corresponding FWB Stock Options were granted. SFG shall make all filings required under federal and state securities laws no later than the Effective Time so as provided in Section 1to permit the exercise of such options and the sale of the shares received by the optionee upon such exercise at and after the Effective Time and SFG shall continue to make such filings thereafter as may be necessary to permit the continued exercise of options and subsequent sale of such shares.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then outstanding and unexercised option (the "each, a “Company Options"Option”) exercisable for to purchase shares of Company Common Stock that is outstanding immediately prior to the Effective Time shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of cease to represent a Company Option right to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for acquire shares of Purchaser Company Common Stock and shall be automatically converted into an option to acquire shares of Parent Class A Stock ("Purchaser Replacement Options") having a “Parent Merger Option”), on the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference any vesting or forfeiture provisions or repurchase rights, but taking into the agreements evidencing the Company Options account any acceleration thereof pursuant to the existing terms of the relevant equity plans of the Company or arrangements pursuant to which applicable award agreement by reason of the transactions contemplated hereby) as were applicable under such Company Options were grantedOption as of immediately prior to the Effective Time, subject to adjustment as provided in this Section 1.11. The number of shares of Parent Class A Stock subject to the Parent Merger Option into which a Company Option is converted shall be equal to (i) except that the exercise price and the number of shares issuable upon exercise shall be divided and multipliedof Company Common Stock subject to the Company Option immediately prior to the Effective Time multiplied by (ii) the Exchange Ratio, respectivelyrounded down, by the Conversion Fractionif necessary, and rounded to the nearest whole cent or numbershare of Parent Class A Stock, respectively. Purchaser and such Parent Merger Option shall use all reasonable efforts have an exercise price per full share of Parent Class A Stock equal to ensure (A) the exercise price of the Company Option per share of Company Common Stock divided by (B) the Exchange Ratio, rounded up, if necessary, to the nearest whole cent; provided, that (1) in the case of any Company Options that qualified Option to which Section 421 of the Code applies as incentive stock options of the Effective Time by reason of its qualification under Section 422 of the Internal Revenue Code Code, the exercise price, the number of 1986shares of Parent Class A Stock subject to such option and the terms and conditions of exercise of such option shall be determined in a manner consistent with the requirements of Section 424(a) of the Code; and (2) the exercise price, as amended (the "number of shares of Parent Class A Stock subject to, and the terms and conditions of exercise of each Parent Merger Option shall also be determined in a manner consistent with the requirements of Section 409A of the Code") . At or prior to the Effective Time continue to so qualify after the Effective Time. Purchaser , Parent shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Parent Class A Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective TimeParent Merger Options. Promptly As soon as practicable after the Effective Time, Purchaser Parent shall file or cause to be filed all a registration statements statement on Form S-8 (or any successor or other appropriate form as may be necessary in connection forms), with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent respect to the Effective Time, shares of Parent Class A Stock subject to such options and shall use its commercially reasonable efforts to maintain the effectiveness of such registration statements statement (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder such options remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided in paragraph paragraphs (b), (c) and (d) below with respect to the Company's 1996 ’s 1998 Employee Stock Purchase Plan, as amended (the "“Company ESPP"”), the Cash-Out Options (as defined in Section 1.8(d)) and certain options to purchase Common Stock at an exercise price greater than $0.82 per share, at the Effective Time, with respect to each then outstanding and unexercised option for Shares (the "“Company Options"”) exercisable for shares of granted under the Company’s 1987 Stock Option Plan, 1997 Stock Option Plan and 1994 Consultant Plan (collectively, the “Company Stock shall become fully vested and exercisable (by virtue of their termsOption Plans”) and or otherwise, Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options (“Purchaser Replacement Options”) exercisable for shares of common stock, par value $.01 per share, of Purchaser Stock ("“Purchaser Replacement Options"Stock”) having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's ’s Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. . For purposes of this Agreement, the term “Conversion Fraction” shall mean the quotient determined by dividing (bx) The current offerings in process as the Common Stock Offer Price by (y) the average closing prices of one (1) shares of the date of this Agreement under Purchaser Stock on The Nasdaq National Market (as reported in the Company ESPP shall continueWall Street Journal or, and Company Shares shall be issued to participants thereunder on if not reported therein, any other authoritative source) for the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately five (5) trading days ending two (2) days prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except At the Effective Time, each Company Stock Option shall cease to represent a right to acquire shares of Company Common Stock and shall be converted automatically into an option to purchase shares of Acquiror Common Stock, and Acquiror shall assume each such Company Stock Option subject to the terms thereof; provided, however, that from and after the Effective Time, (i) the number of shares of Acquiror Common Stock purchasable upon exercise of such Company Stock Option shall be equal to the number of shares of Company Common Stock that were purchasable under such Company Stock Option immediately prior to the Effective Time multiplied by the Exchange Ratio, and rounding to the nearest whole share, and (ii) the per share exercise price under each such Company Stock Option shall be adjusted by dividing the per share exercise price of each such Company Stock Option by the Exchange Ratio, and rounding down to the nearest cent. The terms of each Company Stock Option shall, in accordance with its terms, be subject to further adjustment as appropriate to reflect any stock split, stock dividend, recapitalization or other similar transaction with respect to Acquiror Common Stock on or subsequent to the Effective Date. Notwithstanding the foregoing, each Company Stock Option which is intended to be an "incentive stock option" (as defined in Section 422 of the Code) shall be adjusted in accordance with the requirements of Section 424 of the Code. Accordingly, with respect to any incentive stock options, fractional shares shall be rounded down to the nearest whole number of shares and where necessary the per share exercise price shall be rounded down to the nearest cent. (b) In order to effectuate the adjustment of the Company Stock Options provided for in the proviso to Section 3.06(a), the Company represents and warrants to, and agrees with, the Acquiror that the Company (or as appropriate, the Company Board) shall take all action required to be taken such that (i) holders of Stock Options issued under the Company's Incentive Stock Option Plan will not receive the cash payment for such Stock Options as provided in paragraph the second sentence of Section 10 of such Plan (bwhich shall be effected either by resolving that this Agreement and the transactions contemplated hereby (including the Company Meeting and any Merger) below do not constitute a "Change of Control" for purposes of such Section or by taking such other action with the prior consent of Acquiror, provided that such other action is taken prior to the date on which a "Change of Control" would otherwise occur in the absence of the Company Board resolution to the contrary) and (ii) under Section 11 of the Company's Incentive Stock Option Plan, at the Effective Time, all Company Stock Options shall be adjusted as provided in Section 3.06(a) (and shall not be canceled in exchange for payment as contemplated by clause (ii) of the first sentence of that Section). Notwithstanding any other provision in this Agreement, the Company shall be permitted to take such action or to cause such action to be taken as may be required for each Company Stock Option (x) to fully vest and become immediately exercisable at the Effective Time and (y) to remain exercisable after the Effective Time for the remaining term of such Company Stock Option, in both cases notwithstanding the action of the Company referred to in the first sentence of this Section 3.06(b). (c) At or prior to the Effective Time, the Company shall take all action necessary with respect to the Company's 1996 Employee Incentive Stock Purchase Option Plan to permit the assumption of the then outstanding Company Stock Options by Acquiror pursuant to this Section. The Company shall take all action necessary, including obtaining any required consents from optionees, to provide that following the Effective Time no participant in the Company's Incentive Stock Option Plan or other plans, programs or arrangements of the Company or any of its Subsidiaries shall have any right thereunder to acquire equity securities of the Company, the Surviving Corporation or any subsidiary thereof and to permit Acquiror to assume the Company's Incentive Stock Option Plan. The Company shall further take all action necessary to amend the Company's Incentive Stock Option Plan to eliminate automatic grants or awards thereunder, as amended (if any, following the "Company ESPP"), at Effective Time. At the Effective Time, each then outstanding and unexercised option (Acquiror shall assume the "Company Options") exercisable for shares Company's Incentive Stock Option Plan; provided, that such assumption shall be only in respect of the assumed Company Stock Options and that Acquiror shall become fully vested and exercisable have no obligation with respect to any awards under the Company's Incentive Stock Option Plan other than the assumed Company Stock Options or to make any additional grants or awards under such assumed plan. (by virtue of their termsd) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser The Acquiror shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Acquiror Common Stock for delivery upon pursuant to the exercise terms set forth in this Section 3.06. Subject to any applicable limitations under the Securities Act, Acquiror shall either (i) file a registration statement on Form S-8 (or any successor form), effective as of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall with respect to the shares of Acquiror Common Stock issuable upon exercise of the Stock Options, or (ii) file or cause any necessary amendments to be the Company's previously filed all registration statements statement(s) on Form S-8 or other appropriate form as may in order that the Acquiror will be necessary deemed a "successor registrant" thereunder, and, in connection with either event the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent Acquiror shall use its reasonable best efforts to the Effective Time, and shall maintain the effectiveness of such registration statements statement(s) (and maintain the current status of the prospectus or prospectuses contained thereinrelating thereto) for so long as any of the Purchaser Replacement Options registered thereunder such options shall remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided set forth in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"Section 1.5(b), at all Options outstanding immediately prior to the Effective Time, each then outstanding shall terminate and unexercised option neither IDRC nor TeleSpectrum will have any obligation thereunder to the extent such Options are not exercised prior to the Effective Time. (b) Subject to the "Company Options") exercisable for shares other terms and conditions in this Section 1.5, in lieu of Company Stock shall become fully vested and exercisable (by virtue the termination of their terms) and Purchaser shall cause Options as set forth in Section 1.5(a), each holder of outstanding Options may elect, prior to the Effective Time, to have any Option held by such holder assumed by TeleSpectrum and become a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock new option (an "Purchaser Replacement OptionsAssumed Option") having to purchase Merger Shares and Warrants and containing substantially the same terms and conditions as are in effect for the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") original Option outstanding immediately prior to the Effective Time continue only if such holder (i) agrees to so qualify after place in escrow in accordance with Section 1.6 of this Agreement, a portion of the Effective Time. Purchaser shall take all corporate action necessary to reserve Assumed Option (an "Escrow Option") that is exercisable solely for issuance a sufficient that number of shares of Purchaser TeleSpectrum Common Stock for delivery equal to (A) the product of (1) the total number of Shares of IDRC Common Stock underlying such Assumed Option immediately prior to the Effective Time divided by the Total IDRC Shares Outstanding, and (2) $12,000,000 divided by the "Trading Value" (as defined in Section 1.6(b)), and (ii) completing and returning to IDRC prior to the Effective Time a notice of election of assumption to be provided by IDRC (in form and substance acceptable to TeleSpectrum) to each holder of Options as soon as practicable after the date hereof. Each Assumed Option shall be evidenced by two certificates, one representing the Escrow Option and one representing the remaining portion of the Assumed Option (the "Non-Escrow Option"). (c) At the Effective Time, each Assumed Option shall entitle the holder thereof to that number of Merger Shares and Warrants as set forth below: (i) the number of Merger Shares to be issuable upon exercise of each Assumed Option shall be equal to the product of (A) the number of shares of IDRC Common Stock subject to the corresponding original Option and (B) (1) 9,200,000 divided by (2) the Total IDRC Shares Outstanding, the product being rounded, if necessary, up or down, to the nearest whole share; and (ii) the number of Warrants Shares underlying the Warrants to be issued upon the exercise of Purchaser Replacement Options each Assumed Option shall be equal to the product of (A) the number of shares of IDRC Common Stock subject to the corresponding original Option and (B) (1) 3,000,000 divided by (2) the Total IDRC Shares Outstanding, the product being rounded, if necessary, up or down, to the nearest whole warrant. (d) The exercise price per share of TeleSpectrum Common Stock under each Assumed Option shall be equal to (i) the exercise price per share of the IDRC Common Stock under the corresponding original Option divided by (ii) (A) 9,200,000 divided by (B) the Total IDRC Shares Outstanding, rounded, if necessary, up or down, to the nearest cent. The exercise price for each Escrow Option and each Non-Escrow Option shall be based solely on the number of Escrow Shares represented thereby. (e) The shares of TeleSpectrum Common Stock subject to each Warrant underlying each Assumed Option are obtainable only after the Effective Time. Promptly such Assumed Option and Warrant are properly exercised in accordance with their respective terms. (f) As soon as practicable after the Effective Time, Purchaser TeleSpectrum shall (i) deliver to holders of the original Options, agreements representing the Escrow Options and Non-Escrow Options and (ii) file or cause to be filed all a registration statements statement on Form S-8 (or other appropriate any successor form as may thereto) registering the Merger Shares to be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent issued to the Effective Time, holders of Escrow Options and shall Non-Escrow Options upon the exercise of such Options and to maintain the effectiveness of such registration statements statement (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder such options remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided in paragraph (b) below with respect Nabisco hereby grants to Holdings, on the Company's 1996 Employee Stock Purchase Planterms and conditions set forth herein, as amended a continuing right (the "Company ESPPClass B Common Stock Option")) to purchase from Nabisco, at the Effective Timetimes set forth herein, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Class B Common Stock as is necessary to allow the Holdings Entities to maintain the then-current Ownership Percentage. The Class B Common Stock Option shall be assignable, in whole or in part and from time to time, by Holdings to any Holdings Entity. The exercise price for the shares of Class B Common Stock purchased pursuant to the Class B Common Stock Option shall be the Market Price of the Class A Common Stock as of the date of first delivery upon the of notice of exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file Class B Common Stock Option by Holdings (or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined belowits permitted assignee hereunder) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderNabisco. (b) The current offerings in process as provisions of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date Section 2.01(a) hereof as provided under, and subject to the terms and conditions ofnotwithstanding, the Company ESPP. The Company mayClass B Common Stock Option granted pursuant to Section 2.01(a) shall not apply and shall not be exercisable in connection with the issuance by Nabisco of any shares of Class B Common Stock upon the exercise of stock options granted pursuant to Nabisco's Long Term Incentive Plan or any successor plan, consistent with past practiceso long as, commence new offering periods under the Company ESPP on or from and after the date hereof and prior to the Effective Time issuance of such shares upon exercise of options, Nabisco has repurchased from shareholders such number of shares as shall be equal to or greater than the total number of shares previously issued or to be issued under the Nabisco Long Term Incentive Plan or any successor plan in connection with any such exercise of options. (c) Nabisco hereby grants to Holdings, on the terms and conditions set forth herein, a continuing right (the "Nonvoting Stock Option" and, together with the Class B Common Stock Option, the "Options") to purchase from Nabisco, at an the times set forth herein, such number of shares of Nonvoting Stock as is necessary to allow the Holdings Entities to own 80 percent of each class of outstanding Nonvoting Stock. The Nonvoting Stock Option shall be assignable, in whole or in part and from time to time, by Holdings to any Holdings Entity. The exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, shares of Nonvoting Stock purchased pursuant to the Company ESPP, all offerings under the Company ESPP Nonvoting Stock Option shall be terminated, and each participant shall be deemed the price at which such Nonvoting Stock is then being sold to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1third parties.

Options. To the extent that acceleration by ICH of the exercisability of any outstanding option to purchase shares of ICH Common Stock (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company ICH Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, is permitted but not required by the Conversion Fractionapplicable governing instrument, and rounded then ICH shall not elect to the nearest whole cent or numbercause such acceleration to occur. In connection therewith, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent not prohibited by the terms of payroll deductions accumulated by such participant as of such offering period endthe relevant governing instrument, the number of whole each ICH Option that is outstanding and unexercised immediately prior thereto shall cease to represent a right to acquire shares of Company ICH Common Stock and shall be converted automatically into an option to purchase ACT Common Shares in an amount and at a per share an exercise price determined pursuant as provided below (and otherwise subject to the terms of ICH's Stock Option and Awards Plan (the "ICH Option Plan"), and the agreements evidencing grants thereunder, including, subject to the provisions of the Company ESPPfirst sentence of this Section 2.3, the accelerated vesting of ICH Options that shall occur in connection with and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, Merger as and to the extent required by the ICH Option Plan or such agreements): (a) the number of whole shares of Purchaser ICH Common Stock or cash into which to be subject to the option shall be equal to the product of the number of shares of Company ICH Common Stock such participant has so purchased under the Company ESPP have been converted pursuant subject to the Merger as original option and the Exchange Ratio, provided in Section 1.3(a) hereof, plus the cash value of that any fraction of a an ACT Common Share resulting from such multiplication shall be rounded down to the nearest whole share; and (b) the exercise price per share of Purchaser ICH Common Stock under the option shall be equal to the exercise price per share of ICH Common Stock under the original option divided by the Exchange Ratio, provided that such exercise price shall be rounded up to the nearest whole cent. The adjustment provided herein with respect to ICH Options that are "incentive stock options" (as provided defined in Section 1.5(h422 of the Code) hereofshall be and is intended to be effected in a manner that is consistent with Section 424(a) of the Code and, plus any dividends or distributions to the extent it is not so consistent, Section 424(a) shall override anything to the contrary contained herein. The duration and other terms of the new option shall be the same as provided in Section 1the original option except that all references to ICH shall be deemed to be references to the Surviving Entity.

Options. (ai) Except If the Employee's employment is terminated following a Change of Control as provided in paragraph (b) below with respect to a result of an Involuntary Termination other than for Cause, then the unvested portion of any stock option held by the Employee under the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised stock option (the "Company Options") exercisable for shares of Company Stock plans shall automatically become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue as of the Merger Termination Date and without the Employee or the Employee's representative, as the case may be, shall have the right to exercise all or any action on the part portion of such stock option, in addition to any portion of the holder thereofoption vested or exercisable prior to such termination. If a termination of Employee's employment results in acceleration of vesting of any option, the Employee shall have 24 months following the Termination Date to exercise such option, notwithstanding any contrary provision of the option agreement. (ii) If a Change of Control occurs within 90 days following the termination of Employee's employment as a result of an Involuntary Termination other than for Cause, then Employee or the Employee's representative, as the case may be, shall be fully vested in and have the right to exercise all options which were not vested or exercisable for shares as of Purchaser Stock ("Purchaser Replacement Options") having the Termination Date, at the same terms and conditions exercise price as would have applied if Employee had still been employed at the time of the Change in Control. Promptly following the occurrence of any such Change of Control within such 90 days, the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant will provide to the plans or arrangements pursuant Employee written notice of such Change of Control and a written statement as to which such Company Options were granted) except that the exercise price and the number of shares issuable upon vested and exercisable by Employee as a result of this Section 5(d)(ii) and the exercise price or prices thereof. The right to exercise such option shall be divided and multiplied, respectively, continue for 24 months following the Company's delivery of the written notice contemplated by the Conversion Fraction, and rounded to preceding sentence. In the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure event that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) such options have been converted into different securities as a result of the Securities Exchange Act (Change of Control, or have been converted into a right to receive consideration as defined below) to be exempt from the application of Section 16(b) a result of the Securities Exchange ActChange of Control, Employee shall, upon exercise of such option, be entitled to receive the extent permitted thereunder. (b) The current offerings in process same securities or consideration as of Employee would have received had the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased option been exercised immediately prior to the Effective Time, to the extent Change of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Control.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares As of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and as determined by the LMC Board pursuant to its authority granted under the applicable stock incentive plan of LMC, the following shall maintain the effectiveness of such registration statements occur: (and maintain the current status of the prospectus or prospectuses contained thereini) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such each outstanding LMC Option to purchase shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Liberty Capital Stock, Purchaser Replacement Options whether vested or unvested (each, an “Outstanding LMC Capital Option”), will be converted, automatically, into a Splitco Option to purchase the same number and subsequent transactions in Purchaser series of shares of Splitco Capital Stock after (a “Splitco Capital Option”) as the Effective Time pursuant to Purchaser Replacement Options by persons number and series of shares of Liberty Capital Stock subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased Outstanding LMC Capital Option immediately prior to the Effective Time; and (ii) each outstanding LMC Option to purchase shares of Liberty Starz Stock, whether vested or unvested (each, an “Outstanding LMC Starz Option”), will be converted, automatically, into a Splitco Option to purchase the same number and series of shares of Splitco Starz Stock (a “Splitco Starz Option”) as the number and series of shares of Liberty Starz Stock subject to such Outstanding LMC Starz Option immediately prior to the extent of payroll deductions accumulated by such participant as of such offering period endEffective Time. In addition, the number of whole shares of Company Stock at a per share exercise price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment Splitco Capital Option will be equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As per share exercise price of the Effective Timecorresponding Outstanding LMC Capital Option, and the per share exercise price of each participant shall receive, by virtue Splitco Starz Option will be equal to the per share exercise price of the Mergercorresponding Outstanding LMC Starz Option; provided, that the exercise price and number of whole shares subject to each Splitco Capital Option and Splitco Starz Option shall in any event be determined in a manner consistent with the requirements of Purchaser Stock Section 409A of the Code. All other terms of the Splitco Capital Options and Splitco Starz Options (including the vesting terms thereof) will, in all material respects, be the same as those of the corresponding Outstanding LMC Capital Option and Outstanding LMC Starz Option, respectively, except that the Splitco Options will continue to vest so long as the holder provides service (whether as an employee, non-employee director or cash into which consultant, as the shares case may be) to any of Company Stock such participant has so purchased under LMC, a Qualifying Subsidiary or their respective Subsidiaries; provided, that the Company ESPP have been converted pursuant to terms and conditions of exercise of the Merger as provided Splitco Options shall in any event be determined in a manner consistent with Section 1.3(a) hereof, plus 409A of the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Code.

Options. (a) Except as provided in paragraph (b) below with respect Subject to the Company's 1996 Employee Stock Purchase Planterms and conditions of this Agreement, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised ARIDIS hereby grants to GSK an exclusive option (the "Company Options"“Option”) exercisable for shares of Company Stock shall become fully vested and exercisable to obtain : (by virtue of their termsi) and Purchaser shall cause each holder of a Company Option to receivean exclusive, by virtue of the Merger and without any action on the part of the holder thereofworldwide, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multipliedroyalty bearing license, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase right to grant sublicenses, under ARIDIS Arising IP and ARIDIS’ s interest in the Joint Arising IP and (ii) a non-exclusive, worldwide, royalty bearing license, with the right to grant sublicenses, under ARIDIS Background IP to research, have researched, develop, have developed, make, have made, use, have used, sell, have sold, offer for sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to and import the Effective Time, and shall maintain Vaccine Products in the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderField. (b) GSK may exercise the Option by providing written notice to ARIDIS at any time during the Collaboration Term (as may be extended under Section 3.3) and 6 (six) months after the acknowledgment by the JSC of the completion of the Collaboration Program according to Section 2.1(d)(viii) (the “Option Period-). (c) Upon GSK’s exercise of its Option rights under this Section 4.1 (a), the Parties shall negotiate the terms of the License Agreement in good faith within ninety (90) Business Days following notification by GSK of exercise of said Option rights, or for such additional time as may be mutually agreed by the Parties (the “Negotiation Period”). The current offerings License Agreement shall include the main terms that are set forth in process Exhibit C as well as other usual terms in a license agreement which terms shall be negotiated in good faith by the Parties. (d) Subject to Section 11.5, if as of the date expiration of the Term, the License Agreement is not executed between the Parties, then: (i) Subject to any other provision in this Agreement providing one Party with exclusive rights after the expiration of the Term, each Party and its Affiliates shall have the right (as joint owner and without any requirement of gaining the consent of, or accounting to, the other Party) to practice its interests in any Joint Arising IP and Joint Collaboration Patents in and outside the Field but if a Party decides to grant a license to a Third Party under Joint Arising IP for use in the Company ESPP shall continueField, and Company Shares it shall be issued required to participants thereunder on share equally the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each revenues of such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, license (to the extent relating to the license of payroll deductions accumulated by Joint Arising IP) with the other Party and such participant as license shall be non-exclusive only; and (ii) For the avoidance of such offering period enddoubt, GSK shall have no obligation to enter into discussions with ARIDIS regarding any license or other access to GSK Intellectual Property. (e) Notwithstanding anything to the contrary herein, if GSK exercises the Option in the Field and the Parties execute the License Agreement then, each Party and its Affiliates shall thereafter have the right to practice its interests in the Joint Collaboration Patents and, subject to confidentiality obligations, the number Joint Arising IP solely outside the Field as joint owner, without any requirement of whole shares of Company Stock at a per share price determined pursuant to gaining the provisions of the Company ESPPconsent of, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Mergeror accounting to, the number of whole shares of Purchaser Stock or cash into which other Party but not to grant license to Third Parties in the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Field.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by FNB to purchase shares of FNB Common Stock which is outstanding and unexercised option (the "Company Options") exercisable for immediately prior thereto shall cease to represent a right to acquire shares of Company FNB Common Stock and shall become fully vested be converted automatically into an option to purchase shares of LSB Common Stock in an amount and exercisable at an exercise price determined as provided below (by virtue and otherwise subject to the terms of their termsthe FNB Stock Plans (as defined below) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant grants thereunder): (i) The number of shares of LSB Common Stock to be subject to the plans or arrangements pursuant new option shall be equal to which such Company Options were granted) except that the exercise price and product of the number of shares issuable upon exercise of FNB Common Stock subject to the original option and the Exchange Ratio, provided that any fractional shares of LSB Common Stock resulting from such multiplication shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or numbershare; and (ii) The exercise price per share of LSB Common Stock under the new option shall be equal to the exercise price per share of FNB Common Stock under the original option divided by the Exchange Ratio, respectively. Purchaser provided that such exercise price shall use all reasonable efforts be rounded to ensure that the nearest whole cent. (b) The adjustment provided herein with respect to any Company Options that qualified as options which are “incentive stock options under options” (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "“Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser ”)), shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause be and is intended to be filed all registration statements on Form S-8 or other appropriate form as may be necessary effected in connection a manner which is consistent with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a424(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) Code. The duration and other terms of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares new option shall be issued the same as the original option except that all references to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant FNB shall be deemed to have purchased immediately prior be references to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1LSB.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by MECH to purchase shares of MECH Common Stock which is outstanding and unexercised immediately prior thereto shall be converted automatically into an option to purchase shares of Webster Common Stock in an amount and at an exercise price determined as provided below and otherwise subject to the terms of the Employee Stock Ownership Plan, the 1996 Mechanics Savings Bank Officer Stock Option Plan and the 1996 Mechanics Savings Bank Director Stock Option Plan (the "Company OptionsMECH Stock Plans"); (1) exercisable for The number of shares of Company Webster Common Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant subject to the plans or arrangements pursuant option immediately after the Effective Time shall be equal to which such Company Options were granted) except that the exercise price and product of the number of shares issuable upon exercise of MECH Common Stock subject to the option immediately before the Effective Time, multiplied by the Exchange Ratio, provided that any fractional shares of Webster Common Stock resulting from such multiplication shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded down to the nearest whole cent or numbershare; and (2) The exercise price per share of Webster Common Stock under the option immediately after the Effective Time shall be equal to the exercise price per share of MECH Common Stock under the option immediately before the Effective Time divided by the Exchange Ratio, respectivelyprovided that such exercise price shall be rounded up to the nearest cent. Purchaser The adjustment provided herein shall use all reasonable efforts be and is intended to ensure that any Company Options that qualified as incentive stock options under be effected in a manner which is consistent with Section 422 424(a) of the Internal Revenue Code of 1986, as amended (the "Code") prior to ). The duration and other terms of the option immediately after the Effective Time continue to so qualify after shall be the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon same as the exercise of Purchaser Replacement Options after the Effective Time. Promptly after corresponding terms in effect immediately before the Effective Time, Purchaser shall file except that all references to MECH or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary MS Bank in connection with the purchase and sale of Purchaser MECH Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements Plans (and maintain the current status of corresponding references in the prospectus or prospectuses contained thereinoption agreement documenting such option) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior be references to Webster or ▇▇▇▇▇▇▇ Bank, as applicable. Nothing herein shall be construed as preventing option holders from exercising the same before the Effective Time, to Time in accordance with the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1terms thereof.

Options. (a) Except as provided in paragraph (b) below with respect As of the Effective Time, all options to the Company's 1996 Employee purchase Raptor Shares issued by Raptor pursuant to its 1995 Stock Purchase Option and Grant Plan, as amended and restated (the "Company ESPPRaptor Stock Option Plan"), at or pursuant to the resolution of Raptor's Board of Directors or the Compensation Committee thereof ("Options"), whether vested, unvested or subject to repurchase by Raptor following such exercise, which are outstanding and not exercised immediately prior to the Effective Time, shall be exchanged for options for Axent Common Stock to be issued by Axent. Axent and Raptor shall enter into the Stock Option Exchange Agreement in the form attached hereto as EXHIBIT G. Immediately after the Effective Time, each then Option outstanding and unexercised immediately prior to the Effective Time shall be deemed to constitute an option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receiveacquire, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including were applicable under such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant Option immediately prior to the plans or arrangements pursuant Effective Time, such number of shares of Axent Common Stock as is equal to which the number of Raptor Shares subject to the unexercised portion of such Company Options were granted) except that Option multiplied by the Exchange Ratio (with any fraction resulting from such multiplication to be rounded down to the next lower whole number). The exercise price per share of each such exchanged Option shall be equal to the exercise price and of such Option immediately prior to the number of shares issuable upon exercise shall be Effective Time, divided and multiplied, respectively, by the Conversion Fraction, and Exchange Ratio (with any fraction of a cent resulting from such division to be rounded up to the nearest next higher whole cent or numbercent). Except for any acceleration and termination, respectively. Purchaser shall use all reasonable efforts to ensure that the term, exercisability (including any Company Options that qualified acceleration of exercisability as a result of this transaction), vesting schedule, repurchase provisions, status as an "incentive stock options option" under Section 422 of the Internal Revenue Code of 19861986 (as amended, as amended (the "Code") ), if applicable, and all of the other terms of the Options in effect immediately prior to the Effective Time continue and after giving effect to so qualify any acceleration of vesting for such Options as a result of this transaction shall otherwise remain unchanged. Axent acknowledges that the unvested Options are subject to automatic acceleration of vesting pursuant to the terms of the Raptor Stock Option Plan and related agreements as a result of the consummation of this transaction. (b) As soon as practicable after the Effective Time. Purchaser , Axent or the Surviving Corporation shall deliver to the holders of Options appropriate notices setting forth such holders' rights pursuant to such Options, as amended by this Section 1.9, and the agreements evidencing such Options shall continue in effect on the same terms and conditions (subject to the amendments provided for in this Section 1.9 and such notice). (c) Axent shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Axent Common Stock for delivery upon the exercise of Purchaser Replacement the Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary exchanged in connection accordance with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. Firstar shall take action to amend the Firstar Stock Plans (aas defined herein) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP")so that, at the Effective Time, each then option granted by Firstar to purchase shares of Firstar Common Stock which is outstanding and unexercised option (the "Company Options") exercisable for immediately prior thereto shall cease to represent a right to acquire shares of Company Firstar Common Stock and shall become fully vested be converted automatically into an option to purchase shares of Foxtrot (DE) Common Stock in an amount and exercisable at an exercise price determined as follows (by virtue of their terms) and Purchaser shall cause each holder of a Company Option otherwise subject to receive, by virtue the terms of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock appropriate Firstar Benefit Plan ("Purchaser Replacement Options"as defined herein) having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were grantedoptions have been granted (such plans collectively the "Firstar Stock Plans") except that and the exercise price and agreements evidencing grants thereunder): (i) the number of shares issuable upon exercise of Foxtrot (DE) Common Stock to be subject to the new option shall be divided equal to the product of the number of shares of Firstar Common Stock subject to the original option and multipliedthe Exchange Ratio, respectively, by the Conversion Fraction, and provided that any fractional shares of Foxtrot (DE) Common Stock resulting from such multiplication shall be rounded down to the nearest whole cent or numbershare and (ii) the exercise price per share of Foxtrot (DE) Common Stock under the new option shall be equal to the exercise price per share of Firstar Common Stock under the original option divided by the Exchange Ratio, respectivelyprovided that such exercise price shall be rounded down to the nearest whole cent. Purchaser shall use all reasonable efforts The adjustment provided herein with respect to ensure that any Company Options that qualified as options which are "incentive stock options under options" (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code")) prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause be and is intended to be filed all registration statements on Form S-8 or other appropriate form as may be necessary effected in connection a manner which is consistent with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a424(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) Code. The duration and other terms of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares new option shall be issued the same as the original option except that all references to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant Firstar shall be deemed to have purchased immediately prior be references to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Foxtrot (DE).

Options. (ai) Except Prior to the Pre-Merger Special Dividend Time, the Valeant Board (or, if appropriate, any committee thereof) shall adopt such resolutions or take such other actions (including using reasonable efforts to obtain any required consents) to adjust the terms of all outstanding Valeant Stock Options to provide that, at the Pre-Merger Special Dividend Time and prior to the Effective Time, each Valeant Stock Option outstanding immediately prior to the Pre-Merger Special Dividend Time shall be converted into an option to acquire, on the same terms and conditions as were applicable under such Valeant Stock Option immediately prior to the Pre-Merger Special Dividend Time, a number of shares of Valeant Common Stock, rounded down to the nearest whole share, determined by multiplying the number of shares of Valeant Common Stock subject to such Valeant Stock Option immediately prior to the Pre-Merger Special Dividend Time by the Pre-Merger Special Dividend Adjustment Ratio, at a per share exercise price, rounded up to the nearest whole cent, determined by dividing the per share exercise price of such Valeant Stock Option by the Pre-Merger Special Dividend Adjustment Ratio; provided, however, that the adjustments provided in paragraph (bthis Section 6.04(a)(i) below with respect to any Valeant Stock Options, whether or not they are “incentive stock options” as defined in Section 422 of the Company's 1996 Employee Code, are intended to be effected in a manner that is consistent with Section 424(a) of the Code and Section 409A of the Code. (ii) Prior to the Effective Time, the Valeant Board (or, if appropriate, any committee thereof) shall adopt such resolutions or take such other actions (including using reasonable efforts to obtain any required consents) to adjust the terms of all outstanding Valeant Stock Purchase Plan, as amended (the "Company ESPP")Options to provide that, at the Effective Time, each then Valeant Stock Option outstanding and unexercised immediately prior to the Effective Time shall be converted into an option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receiveacquire, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as were applicable under such Valeant Stock Option following the Company Options (including such terms Pre-Merger Special Dividend Time and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, a number of shares of Biovail Common Stock, rounded down to the extent of payroll deductions accumulated nearest whole share, determined by such participant as of such offering period end, multiplying the number of whole shares of Company Valeant Common Stock subject to such Valeant Stock Option following the Pre-Merger Special Dividend Time and immediately prior to the Effective Time by the Equity Award Exchange Ratio, at a per share price determined pursuant exercise price, rounded up to the provisions nearest whole cent, determined by dividing the per share exercise price of such Valeant Stock Option by the Equity Award Exchange Ratio; provided, however, that the adjustments provided in this Section 6.04(a)(ii) with respect to any Valeant Stock Options, whether or not they are “incentive stock options” as defined in Section 422 of the Company ESPPCode, and each participant shall receive are intended to be effected in a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As manner that is consistent with Section 424(a) of the Effective Time, each participant shall receive, by virtue Code and Section 409A of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Code.

Options. (a) Except as provided in paragraph (b) below with With respect to all outstanding options to purchase Shares (the "COMPANY OPTIONS") granted under the Company's 1996 Employee 1992 Incentive and Non-qualified Stock Purchase Option Plan, as amended, 1992 Directors' Stock Option Plan, as amended, and 2004 Stock Option Plan, as amended (collectively, the "Company ESPPCOMPANY OPTION PLANS")) or otherwise, whether or not then vested, at the Effective Time, each then outstanding subject to the terms and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause conditions set forth below in this Section 1.6(a), each holder of a Company Option will be entitled to receive from the Company, and shall receive, by virtue in settlement of each Company Option a cash amount (the "CASH AMOUNT") equal to the net amount of (A) the product of (i) the excess, if any, of the sum of the Merger and without any action on Consideration plus the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that Distribution Consideration less the exercise price and per share of such Company Option at the Effective Time, multiplied by (ii) the number of shares issuable upon subject to such Company Option, less (B) any applicable withholdings for Taxes. If the exercise price per share of any Company Option equals or exceeds the sum of the Merger Consideration plus the Distribution Consideration, the Cash Amount therefor shall be divided zero and multiplied, respectively, by the Conversion Fraction, such Company Option shall be cancelled and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any of such holder's rights under such Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after shall terminate at the Effective Time. Purchaser shall take all corporate action necessary Notwithstanding the foregoing, (i) payment of the Cash Amount is subject to reserve for issuance written acknowledgement, in a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent reasonably acceptable to the Effective TimeSurviving Corporation, that no further payment is due to such holder on account of any Company Option and shall maintain the effectiveness all of such registration statements holder's rights under such Company Options have terminated and (and maintain the current status of the prospectus or prospectuses contained thereinii) for so long as with respect to any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons person subject to the reporting requirements of Section 16(a) of the Securities Exchange Act of 1934, as amended (as defined below) the "EXCHANGE ACT"), any Cash Amount to be exempt from paid to such person in accordance with this Section 1.6(a) shall be paid as soon as practicable after the application of payment can be made without liability to such person under Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receiveexcept as provided in this Section 1.6, by virtue all rights under any Company Option and any provision of the MergerCompany Option Plans and any other plan, program or arrangement providing for the number issuance or grant of whole shares any other interest in respect of Purchaser Stock the securities of the Company shall be cancelled. The Company shall ensure that, as of and after the Effective Time, except as provided in this Section 1.6, no person shall have any right (including, without limitation, any right to acquire any securities of the Company or cash into which the shares any of Company Stock such participant has so purchased its subsidiaries) under the Company ESPP have been converted pursuant Option Plans or any other plan, program or arrangement with respect to securities of the Company, the Surviving Corporation or any subsidiary thereof. (c) At or before the Effective Time, the Company shall cause to be effected any necessary amendments to the Merger as provided Company Option Plans and any other resolutions, consents or notices, in form and substance reasonably acceptable to Purchaser, required under the Company Option Plans or any Company Options to give effect to the foregoing provisions of this Section 1.3(a1.6. (d) hereofThe Company and the Purchaser agree that it is their intent to, plus and that they will, report all income tax deductions resulting from the cash value payment of any fraction the Cash Amount in the portion of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1the Company's taxable year prior to the Effective Time.

Options. In accordance with the terms of the Company’s 2001 Stock Incentive Plan (a) Except as provided in paragraph (b) below with respect amended prior to the date hereof, the “Company's 1996 Employee ’s Stock Purchase Option Plan, as amended (the "Company ESPP"”), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"i) prior to the Effective Time continue the Company will elect to so qualify after cause all of the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser options granted under the Company’s Stock for delivery upon Option Plan that are outstanding (each an “Option” and collectively, the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection “Options,” and together with the purchase and sale of Purchaser Common Stock contemplated by such Purchaser Replacement Options subsequent sometimes referred to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under as the “Company ESPP shall continue, Securities”) and Company Shares shall be issued unvested to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased become fully vested immediately prior to the Effective Time, (ii) the Company shall cause all of the Options that are outstanding immediately prior to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant Effective Time to be canceled immediately prior to the provisions of Effective Time and shall terminate the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As Company’s Stock Option Plan as of the Effective Time, and (iii) subject to the transfers and reductions provided for in Section 2.6, each participant holder of Options (each an “Optionholder” and collectively the “Optionholders” and together with the Company Stockholders, sometimes referred to in this Agreement as the “Securityholders”) shall receive, by virtue be entitled to receive from the Company out of the MergerPayment Fund paid by the Acquiror to the Paying Agent for the benefit of the Securityholders in accordance with Section 2.6(f), in consideration for such cancellation, the Option Price multiplied by the number of shares of Common Stock issuable upon exercise of the Options held by such Optionholder, minus the aggregate exercise price for the Common Stock issuable upon exercise of the Options held by such Optionholder. The holder of record of each Option, the number of whole shares of Purchaser Common Stock for which the Options held by such holder are exercisable, and the exercise price thereof, in each case as of the date hereof, is set forth on Schedule 2.3. Any and all amounts payable to or for the benefit of Optionholders pursuant to this Section 2.3 and Section 2.6 shall be subject to the Company’s withholding from such amount any and all applicable withholding Tax, as determined in good faith by the Company. The Company and Acquiror shall take or cause to be taken all action necessary so that on and after the Effective Time no Person shall have any option to purchase shares of Common Stock or cash into which any other equity interest in the shares of Company Stock such participant has so purchased pursuant to Options outstanding under the Company’s Stock Option Plan. Effective on or prior to the Effective Time, the Company ESPP have been converted will terminate (A) the provisions of all other plans, programs, or arrangements of the Company pursuant to the Merger as provided which any Person shall have any right to acquire or participate in Section 1.3(a) hereof, plus the cash changes in value of any fraction equity securities of a share of Purchaser Common Stock as provided in Section 1.5(hthe Company and (B) hereof, plus any dividends or distributions as provided in Section 1all such rights.

Options. (ai) Except Effective as of the Start Date, the Company shall grant to the Executive an option to purchase 125,000 shares of the Company’s common stock at $27.65 per share, and as of the earlier of May 1, 2012 and the initial public offering of the Company’s common stock (provided that the Executive is still employed by the Company as of the applicable date), the Company shall grant to the Executive an option to purchase an additional 125,000 shares of the Company’s common stock at a purchase price equal to the then current fair market value of the Company’s common stock or the initial public offering price (the “Stock Options”). The Stock Options will be subject to the adjustment provisions set forth in paragraph the Company’s Long-Term Incentive Plan (bthe “Plan”). The Executive may, with the consent of the Company, such consent not to be unreasonably withheld, assign the Stock Options for bona fide planning purposes to members of his immediate family, or to a trustee or trustees of a trust whose vested beneficiaries then include the Executive and/or any of the Executive’s immediate family, if (A) below with respect the persons who would control the Stock Options and the proposed arrangements for the control of the Stock Options are reasonably satisfactory to the Company's 1996 Employee , including, without limitation, that any Stock Purchase Options will remain subject to all of the forfeiture and transfer restrictions and conditions set forth in the applicable Stock Option Award Agreement and in the Plan, (B) the requirements of the Securities Act of 1933, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms“Securities Act”) and Purchaser shall cause each holder of a Company Option to receiveany applicable state securities, by virtue of the Merger and without any action on the part of the holder thereofblue sky or other laws are met, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided Executive and multiplied, respectively, by the Conversion Fraction, and rounded to transferee acknowledge that (x) the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that Executive remains responsible for any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon tax liabilities associated with the exercise of Purchaser Replacement the Stock Options after and (y) the Effective Time. Promptly after Company will not take on any role or liability whatsoever with respect to any transferee other than the Effective Time, Purchaser shall file or cause obligation to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status deliver shares of the prospectus or prospectuses contained therein) for so long Company’s common stock under the applicable Stock Option Award Agreement as any of if the Purchaser Replacement Stock Options registered thereunder remain outstanding. As soon as practicable after were still held by the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderExecutive. (bii) The current offerings Stock Options shall vest in process as three equal annual installments on the first, second and third anniversaries of the applicable grant date of this Agreement under (each, a “Vesting Date”), provided in each case that the Executive is employed by the Company ESPP on the applicable Vesting Date. The Stock Options shall continue, have a ten-year term (subject to earlier termination upon termination of employment as described herein and Company Shares in the applicable option agreement) and shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions ofof the Company’s Long-Term Incentive Plan and option agreements, all of which shall be consistent with the Company ESPPExecutive’s rights set forth in this Section 3(c). The Company may, consistent with past practice, commence new offering periods under Executive may receive additional stock option or other equity compensation grants in the Company ESPP on or after future in the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions sole discretion of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Company’s Compensation Committee.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent Prior to the Effective Time, with respect to each option to purchase shares of Xenon 2 into which options to purchase shares of Xoom (a "XOOM OPTION"), which were granted pursuant to the Xoom 1998 Stock Incentive Plan (the "XOOM OPTION PLAN") prior to May 9, 1999, were converted (the "CONVERTED XOOM PLAN OPTIONS"), Xenon 2 shall cause the Administrator (as defined in the Xoom Option Plan) to exercise its discretion to provide, and shall maintain take any other necessary action to provide, that each Converted Xoom Plan Option shall vest and become exercisable with respect to all shares as to which such options would otherwise have vested within 12 months following the effectiveness Effective Time. With respect to each option to purchase shares of Xenon 2 into which Xoom Options, which were not granted pursuant to the Xoom Option Plan prior to May 9, 1999, were converted (the "CONVERTED XOOM NON-PLAN OPTIONS"), Xenon 2 shall take any necessary action to provide that such Converted Xoom Non-Plan Options shall to the extent provided in the award agreement evidencing such option vest and become exercisable with respect to 75% of the then unvested portion of such registration statements (Converted Xoom Non-Plan Option and maintain any portion of a Converted Xoom Non-Plan Option which remains unexercised upon the current status occurrence of the prospectus or prospectuses contained thereinEffective Time shall terminate upon the occurrence of the Effective Time. In addition, with respect to each option to purchase shares of Xenon 2 into which Xoom Options, which were granted after May 9, 1999, were converted (the "CONVERTED NEW XOOM OPTIONS"), Xenon 2 shall cause the Administrator to exercise its discretion to provide, and shall take any other necessary action to provide, that each option Converted New Xoom Option shall not immediately vest (but rather, shall vest in accordance with its stated vesting schedule) for so long as with respect to any of the Purchaser Replacement shares subject thereto. Xenon 2 and Xoom acknowledge that the transaction contemplated hereby shall constitute a "Corporate Transaction" for purposes of both the Xoom Option Plan and the Converted Xoom Non-Plan Options registered thereunder remain outstanding. As soon as practicable after and the Effective TimeAdministrator, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors of Xoom and the Board of Directors of Xenon 2 shall take all actions necessary on action to effect the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderforegoing. (b) The current offerings in process as In the event that any Xoom employee incurs an excise tax under Section 4999 of the date Code as a result of this Agreement under the Company ESPP accelerated vesting of the Xoom Options pursuant to SECTION 6.8(A), Xenon 2 shall continuemake available to such employee a loan (the "TAX LOAN") in an amount sufficient to pay such excise tax. The determination of whether any such excise tax will be payable and the amount of such excise tax will be made by Xoom 2's independent auditors. The Tax Loan will (i) have a term of two years, and Company Shares shall (ii) bear interest at the lowest permissible rate without imputation of income, compounded annually and (iii) to the extent not previously forgiven become immediately due and payable upon the termination of such employee's employment with Xenon 2 and its Affiliates for cause or due to such employee's voluntary resignation. The Tax Loan, will be issued forgiven with respect to participants thereunder 1/24 of the initial principal amount of the Tax Loan (together with accrued interest thereon) on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to last day of each 1 month anniversary of the Effective Time at an exercise price for each if the employee has remained continually employed with Xenon 2 and its Affiliates through such offering not less than as date or if such employee's employment with Xenon 2 and its Affiliates is required under the Company ESPP. Immediately prior terminated without cause or due to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock employee's death or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1disability.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then outstanding and unexercised other than with respect to any option (the "Company Options") exercisable for to purchase shares of Company Common Stock granted pursuant to the ESPP, the treatment of which is addressed separately in Section 1.05(c) below, each outstanding Company Stock Option, whether or not then exercisable or vested, shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option be cancelled in exchange for the right to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions soon as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to reasonably practicable after the Effective Time continue to so qualify after (but in any event no later than the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly earliest of: (i) three Business Days after the Effective Time, Purchaser shall file (ii) the end of the year in which the Effective Time occurs, or cause to be filed all registration statements on Form S-8 or other appropriate form (iii) the expiration of the original term of such Company Stock Option outstanding as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time), and shall maintain an amount in cash equal to the effectiveness product of such registration statements (and maintain A) the current status total number of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Company Common Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the such Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased Stock Option immediately prior to the Effective Time, to multiplied by (B) the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balanceexcess, if any, of (x) the sum of the product of the Stock Consideration multiplied by the volume-weighted average price, rounded to the nearest one-tenth of a cent, of Parent Common Stock as reported by the NYSE for the five trading days immediately preceding the Closing Date plus the Cash Consideration over (y) the exercise price per share of Company Common Stock subject to such accumulated payroll deductions remaining after Company Stock Option, without interest and less any applicable taxes required to be withheld with respect to such payment. As used herein, the term “Company Stock Option” shall mean any outstanding option to purchase shares of such sharesCompany Common Stock granted under any Stock Plan or otherwise. As of the Effective Time, each participant shall receive, by virtue Company Stock Option for which the exercise price per share of Company Common Stock exceeds the Merger Consideration (based on a valuation of the MergerStock Consideration as set forth in clause (x) of Section 1.05(b)) shall be canceled and have no further effect, with no right to receive any consideration therefor. As of the Effective Time, all other Company Stock Options shall no longer be outstanding and shall automatically cease to exist and shall become only the right to receive the option consideration described in this Section 1.05(b), and, without limiting the foregoing, the number of whole shares of Purchaser Stock Company Board or cash into which the shares of Company Stock appropriate committee thereof shall take all necessary action to effect such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1cancellation.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each options under the Company's Amended and Restated 1994 Stock Option Plan (the "Assumed Stock Option Plan") to purchase Shares (each, a "Company Option"), which are then outstanding and unexercised option (the "Company Options") exercisable for unexercised, shall cease to represent a right to acquire Shares and shall be converted automatically into options to purchase shares of Company Stock common stock, par value $.001 per share, of Parent ("Parent Common Stock"), and Parent shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause assume each holder of a such Company Option subject to receive, by virtue the terms of the Merger and without any action on the part of the holder thereofAssumed Stock Option Plan, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions in each case as heretofore amended or restated, as the Company Options (including such terms case may be, and conditions as may be incorporated by reference into the agreements evidencing grants thereunder; provided, however, that from and after the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were grantedEffective Time, (i) except that the exercise price and the number of shares issuable of Parent Common Stock purchasable upon exercise of such Company Option shall be divided and multiplied, respectively, equal to the number of Shares that were purchasable under such Company Option immediately prior to the Effective Time multiplied by the Conversion FractionExchange Ratio (as hereinafter defined), and rounded rounding to the nearest whole cent share, and (ii) the per share exercise price under each such Company Option shall be adjusted by dividing the per share exercise price of each such Company Option by the Exchange Ratio, and rounding down to the nearest cent. The terms of each Company Option shall, in accordance with its terms, be subject to further adjustment as appropriate to reflect any stock split, stock dividend, recapitalization or numberother similar transaction with respect to Parent Common Stock on or subsequent to the Effective Date. Notwithstanding the foregoing, respectively. Purchaser shall use all reasonable efforts each Company Option which is intended to ensure that any Company Options that qualified as be an "incentive stock options under option": (as defined in Section 422 of the Internal Revenue Code of 1986, as amended amended, (the "Code")) prior shall be adjusted in accordance with the requirements of Section 424 of the Code. Accordingly, with respect to any incentive stock options, fractional shares shall be rounded down to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient nearest whole number of shares of Purchaser Stock for delivery upon and the per share exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser price shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent rounded down to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPPnearest cent. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as Exchange Ratio is required under the Company ESPP0.197656. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1ARTICLE III CERTIFICATE OF INCORPORATION AND BY-LAWS OF THE SURVIVING CORPORATION; OFFICERS AND DIRECTORS OF THE SURVIVING CORPORATION 3.1.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then (i) all options to acquire shares of Enron Common Stock outstanding and unexercised option at the Effective Time under Enron's stock plans (collectively, the "Company Enron Stock Plans") identified in Section 4.5(a) of the Enron Disclosure Letter (individually, a "Enron Option" and collectively, the "Enron Options") exercisable for and (ii) all options to acquire shares of Company Dynegy Class A Common Stock shall become fully vested and exercisable outstanding at the Effective Time under Dynegy's stock plans (by virtue of their termscollectively, the "Dynegy Stock Plans") and Purchaser shall cause each holder of a Company Option to receive, by virtue identified in Section 4.5(a) of the Merger Dynegy Disclosure Letter (individually, a "Dynegy Option" and without any action on collectively, the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Dynegy Options") having shall remain outstanding following the Effective Time, subject to the modifications described in this Section 4.5(a). Prior to the Effective Time, Enron, Dynegy and Newco shall take all actions (if any) as may be required to permit the assumption of such Enron Options and Dynegy Options by Newco pursuant to this Section 4.5(a). At the Effective Time, the Enron Options and the Dynegy Options shall be assumed and adjusted by Newco in the manner set forth herein and with respect to Dynegy Options that are incentive stock options within the meaning of Section 422 of the Code in such manner that Newco is a corporation "assuming a stock option in a transaction to which Section 424(a) applies" within the meaning of Section 424 of the Code. Each Enron Option assumed and adjusted by Newco shall be subject to the same terms and conditions as under the Company Options applicable Enron Stock Plan and the applicable option agreement entered into pursuant thereto, except that, immediately following the Effective Time, (including A) each Enron Option shall be an option for that whole number of shares of Newco Class A Common Stock (rounded up to the next whole share) equal to the number of shares of Enron Common Stock subject to such Enron Option immediately prior to the Effective Time multiplied by the Enron Merger Ratio, and (B) the exercise price per Newco share shall be an amount equal to the exercise price per share of Enron Common Stock subject to such Enron Option in effect immediately prior to the Effective Time divided by the Enron Merger Ratio (the price per share, as so determined, being rounded down to the nearest whole cent). Each Dynegy Option assumed and adjusted by Newco shall be subject to the same terms and conditions as may under the applicable Dynegy Stock Plan and the applicable option agreement entered into pursuant thereto, except that, immediately following the Effective Time, each Dynegy Option shall be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and an option for the number of shares issuable upon exercise of Newco Class A Common Stock equal to the number of shares of Dynegy Common Stock subject to such Dynegy Option immediately prior to the Effective Time. Without limiting the foregoing, effective at the Effective Time, Newco shall assume the Enron Corp. 1999 Stock Plan, Enron Corp. 1994 Stock Plan, Enron Corp. 1991 Stock Plan, Dynegy Inc. 2000 Long Term Incentive Plan, Dynegy Inc. 2001 Non-Executive Stock Incentive Plan and Dynegy Inc. 2001 Special Long-Term Incentive Plan (collectively, the "Assumed Plans") for purposes of employing such plans to make grants of stock options and other awards based on shares of Newco Class A Common Stock following the Effective Time; to the extent that any obligation exists at the Effective Time to issue Enron Common Stock or Dynegy Class A Common Stock under any Assumed Plan, the obligation of Newco thereafter to issue Newco Common Stock in fulfillment of such previous obligation shall be divided and multipliedto issue the number of shares of Newco Common Stock equal to (i) in the case of Enron Common Stock, respectively, by the Conversion Fraction, and number of shares (rounded to the nearest whole cent share) of Enron Common Stock subject to such obligation multiplied by the Enron Merger Ratio and (ii) in the case of Dynegy Class A Common Stock, the number of shares of Dynegy Class A Common Stock subject to such obligation; provided, however, that, if the obligation is an award of a specified dollar amount of Enron Common Stock or numberDynegy Common Stock, respectively. Purchaser the substitution shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of be effected simply by substituting Newco Common Stock having the Internal Revenue Code of 1986, as amended specified dollar value. (the "Code"b) At or prior to the Effective Time continue to so qualify after the Effective Time. Purchaser , Newco shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Newco Class A Common Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent equal to the Effective Time, and shall maintain the effectiveness number of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Newco Class A Common Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time available for issuance pursuant to Purchaser Replacement Options by persons subject the Assumed Plans (which number shall be the sum of (i) the product (rounded to the reporting requirements of Section 16(anearest whole share) of the Securities Exchange Act (as defined below) to be exempt from the application number of Section 16(b) shares of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and Enron Common Stock available for issuance immediately prior to the Effective Time at an exercise price multiplied by the Enron Merger Ratio plus (ii) the number of shares of Dynegy Common Stock available for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased issuance immediately prior to the Effective Time). Promptly following the Closing Date, Newco shall file with the Securities and Exchange Commission (the "SEC") a Registration Statement on Form S-8 (or a post-effective amendment on Form S-8 with respect to the extent Form S-4 or such other appropriate form) covering all such shares of payroll deductions accumulated Newco Class A Common Stock and shall cause such registration statement to remain effective (and shall cause the prospectus or prospectuses relating thereto to remain compliant with applicable securities laws) for as long as there are outstanding any such Enron Options or Dynegy Options or, with respect to Assumed Plans other than the Enron Stock Plans or Dynegy Stock Plans, for as long as required under applicable securities laws. (c) Except as otherwise specifically provided by such participant as of such offering period endthis Section 4.5, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions terms of the Company ESPPEnron Options and Dynegy Options and the relevant Enron Stock Plans and Dynegy Stock Plans, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of as in effect on the Effective Time, each participant shall receiveremain in full force and effect with respect to the Enron Options and Dynegy Options, as applicable, after giving effect to the Mergers and the assumptions by virtue of the MergerNewco as set forth above; similarly, the number terms of whole shares each other Assumed Plan shall remain in full force and effect after giving effect to the Mergers and the assumptions by Newco as set forth above. As soon as practicable following the Effective Time, Newco shall deliver to the holders of Purchaser Enron Options and Dynegy Options and beneficiaries of awards under Assumed Plans other than Enron Stock or cash into which Plans and Dynegy Stock Plans appropriate notices setting forth the shares rights of Company Stock such participant has so purchased under the Company ESPP have been converted holders and beneficiaries pursuant to the Merger as provided respective Enron Stock Plans and Dynegy Stock Plans and other Assumed Plans and under the agreements evidencing the grants of such Enron Options and Dynegy Options, and that such Enron Options and Dynegy Options and such Assumed Plans shall be assumed by Newco and shall continue in effect on the same terms and conditions (subject to any adjustments required by this Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 14.5).

Options. (a) Except as provided set forth in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"Section 3.1(e), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company mayshall cause all Common Options, consistent with past practicewhether or not vested, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased that are outstanding immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant be cancelled as of such offering period endthe Effective Time, and in exchange therefor, the number of whole shares of Company Stock at a per share price determined pursuant Surviving Corporation shall pay to the provisions each Common Optionholder, in consideration of the Company ESPP, and each participant shall receive a cancellation of such Common Option: (i) an amount in cash payment equal to the balanceproduct of (x) the excess, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As (A) the Per Share Portion of the Effective TimeEstimated Merger Consideration over (B) the applicable exercise price per share of Company Common Stock issuable under such Common Option, each participant shall receive, multiplied by virtue of the Merger, (y) the number of whole shares of Purchaser Stock or cash into which the shares of Company Common Stock subject to such participant Common Option (the “Exercise Number” for such Common Option) (the “Estimated Common Option Merger Consideration”); and (ii) an amount in cash equal to the product of (x) the Exercise Number for such Common Option multiplied by (y) the excess, if any, of (A) the sum of the Per Share Portion of any Additional Merger Consideration and the Per Share Portion of the Estimated Merger Consideration over (B) the sum of the applicable exercise price per share of Company Common Stock issuable under such Common Option and the amount, if any, of the excess described in clause (i)(x) of this Section 3.1(d) (the “Additional Common Option Merger Consideration”). No holder of a Common Option that has so purchased under an exercise price per share that is equal to or greater than the Per Share Portion of the Estimated Merger Consideration shall be entitled to any payment with respect to such Common Option before or after the Effective Time and all such Common Options shall be cancelled for no consideration. All payments of (1) Estimated Common Option Merger Consideration shall be made (without interest) no later than the next payroll payment to such Common Optionholders but in no event sooner than three (3) Business Days after the Closing Date and (2) Additional Common Option Merger Consideration shall be made (without interest) no later than the next payroll date that is no earlier than three (3) Business Days after the date the Surviving Corporation receives any Additional Common Option Merger Connection to such Common Optionholders, or, if such Common Optionholder is not employed by the Company ESPP have been converted on such date, by check. The aggregate consideration to which Common Optionholders become entitled pursuant to this Section 3.1(d) is collectively referred to herein as the “Common Option Merger as provided Consideration.” The Company shall take all necessary actions in order to effectuate this Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 13.1(d).

Options. As of the Redemption Date, each outstanding option to purchase shares of Liberty Entertainment Stock (aeach, an "Outstanding Liberty Entertainment Option") Except as provided in paragraph will be split, automatically, into two option awards: (bi) below an option award (an "LEI Option") to purchase the number and series of whole shares of LEI Stock which the holder would have received on the Redemption Date with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Liberty Entertainment Stock shall become fully vested and exercisable subject to such Outstanding Liberty Entertainment Option if the holder had exercised such Outstanding Liberty Entertainment Option immediately prior to the Redemption Date (by virtue but subject to any modification to the terms of their termssuch LEI Option as provided for in Section 2.4(b) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger Agreement)), with any fraction of a share rounded down to the nearest whole number; and (ii) an adjusted option award (an "Adjusted Liberty Entertainment Option") to purchase the number and without series of whole shares of Liberty Entertainment Stock which the holder would have retained immediately following the Redemption Date had the holder exercised such Outstanding Liberty Entertainment Option immediately prior to the Redemption Date, with any action fraction of a share rounded down to the nearest whole number. The aggregate intrinsic value of each Outstanding Liberty Entertainment Option will be allocated between the LEI Option and the Adjusted Liberty Entertainment Option, with the exercise price of each calculated in accordance with the formula set forth on Schedule 3.3 (with any fraction of a cent rounded up). It is the part intent of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except formula set forth on Schedule 3.3 that the exercise price and the number of shares issuable upon exercise of Liberty Entertainment Stock and LEI Stock subject to such options shall be divided and multiplied, respectively, by determined in a manner consistent with the Conversion Fractionrequirements of Section 424 of the Code to avoid treatment as non-qualified deferred compensation subject to Section 409A, and rounded to the nearest whole cent or number, respectivelyprovisions of such schedule shall be interpreted accordingly. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 All other terms of the Internal Revenue Code LEI Options and related Adjusted Liberty Entertainment Options (including, for example, the vesting terms thereof) will, in all material respects, be the same as those of 1986the corresponding Outstanding Liberty Entertainment Option, except (A) as amended described above and (B) that the "Code") prior to the Effective Time options will continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for vest so long as the holder provides service (whether as an employee, consultant or nonemployee director, as the case may be) to any of LMC and its Subsidiaries, LEI and its Subsidiaries and any other Person that was a Subsidiary of LMC until the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance capital stock of such shares Person was distributed to the holders of Purchaser Stock issuable upon exercise one or more series of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons LMC common stock (subject to the reporting requirements any acceleration of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent vesting otherwise provided or permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to by the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1award).

Options. (ai) Except as provided Acquiror shall not assume, continue or otherwise replace any Vested Option in paragraph (b) below connection with respect the transactions contemplated hereby. Upon the terms and subject to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP")conditions set forth in this Agreement, at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereofAcquiror, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as Merger Sub, the Company Options (including or the holders of Vested Options, each Vested Option shall be cancelled and converted into a right to receive, in respect of each share of Common Stock subject to such terms Vested Option, without interest, subject to applicable withholding Taxes, at the respective times and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant subject to the plans or arrangements pursuant to which withholdings and adjustments set forth in Sections 2.9 and 2.10 and the execution and delivery of a duly executed Option Termination Agreement substantially in the form attached as Exhibit E (each such Company Options were grantedagreement, an “Option Termination Agreement”), an amount in cash equal to: (A) except that the Final Per Share Consideration, minus (B) the exercise price and per share under such Vested Option. For the number avoidance of shares issuable upon exercise doubt, each holder of a Vested Option will be entitled to receive a portion of the Earnout Payment, if any, in accordance with Section 2.14. The amount of cash each holder of a Vested Option is entitled to receive for all Vested Options held by such holder shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded down to the nearest whole cent or number, respectively. Purchaser shall use and computed after aggregating cash amounts for all reasonable efforts to ensure that any Company Vested Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated held by such Purchaser Replacement Options subsequent to the Effective Timeholder. (ii) Prior to, and shall maintain contingent upon, the effectiveness of such registration statements (and maintain Closing, the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors Company shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options provide that each Unvested Option and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to Out-of-the-Money Option shall be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderterminated and canceled for no consideration. (biii) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject Prior to the terms and conditions ofClosing, the Company ESPP. The Company mayshall provide any notices and transmittal information to holders of Vested Options, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminatedUnvested Options, and each participant shall be deemed to have purchased immediately prior to the Effective TimeOut-of-the-Money Options, to and the extent board of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions directors of the Company ESPPshall adopt any resolutions necessary to effectuate the foregoing, in each case after giving Acquiror reasonable opportunity to review and each participant shall receive a cash payment equal to comment on the balance, if any, of such accumulated payroll deductions remaining after such purchase of such sharesnotice or resolution. As of In connection with the Effective Time, each participant shall receive, by virtue of the Mergerforegoing, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant shall use commercially reasonable efforts to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction obtain from each holder of a share Vested Option an executed Option Termination Agreement and the execution of Purchaser Common Stock as provided in an Option Termination Agreement shall be a condition to each holder of a Vested Option receiving any payment under Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 12.6(c)(i).

Options. Each option to purchase shares of Liberty SiriusXM Common Stock (aa “Liberty SiriusXM option award”) Except that is outstanding as provided in paragraph (b) below with respect of immediately prior to the Company's 1996 Employee Stock Purchase PlanEffective Time shall accelerate and become fully vested immediately prior to, as amended (and contingent upon the "Company ESPP")occurrence of, at the Effective Time. As of the Effective Time, each then outstanding and unexercised option (as has been determined by the "Company Options") exercisable for shares Liberty Board pursuant to its authority granted under the applicable stock incentive plan of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger Liberty Media and without any further action on the part of the holder thereof, options exercisable for Liberty Media or SplitCo, each Liberty SiriusXM option award (as accelerated in accordance with the previous sentence) shall cease to represent an option award to purchase shares of Purchaser Liberty SiriusXM Common Stock and will be converted into an option to purchase shares of SplitCo Common Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) a “SplitCo option award”), except that the exercise price and (1) the number of shares issuable upon exercise of SplitCo Common Stock subject to such SplitCo option award shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded equal to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 product of (x) the Internal Revenue Code of 1986, as amended Exchange Ratio multiplied by (y) the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Liberty SiriusXM Common Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased Liberty SiriusXM option award immediately prior to the Effective Time, rounded down to the extent nearest whole share of payroll deductions accumulated by such participant as SplitCo Common Stock, and (2) the per share exercise price of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant SplitCo option award shall receive a cash payment be equal to the balance, if any, quotient of such accumulated payroll deductions remaining after such purchase of such shares. As (x) the exercise price per share of the Liberty SiriusXM option award immediately prior to the Effective TimeTime divided by (y) the Exchange Ratio, each participant shall receivewith the result rounded up to the nearest whole cent. Except with respect to the vesting terms thereof and as otherwise described herein, by virtue all other terms of the MergerSplitCo option awards will, in all material respects, be the number same as those of whole shares the corresponding Liberty SiriusXM option awards; provided, however, that neither the Effective Time nor any other transaction contemplated by this Agreement or the Merger Agreement shall be considered a termination of Purchaser Stock employment or cash into which service for any employee, non-employee director or consultant of Liberty Media, any Qualifying Subsidiary or their respective Subsidiaries for purposes of any SplitCo option award; provided, further, that the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant SplitCo option awards shall be subject to the Merger as provided in Section 1.3(a) hereof, plus terms of the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1SplitCo Transitional Plan.

Options. (a) Except as provided in paragraph (b) below with respect Conectiv shall take all action reasonably necessary so that, immediately prior to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised stock option (issued under the "Company Options") exercisable for shares of Company Conectiv Stock Option Plan shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue as of the Merger Effective Time and without any action on shall, at the part election of the holder thereof, options exercisable be either (i) canceled and the holder thereof shall be entitled to receive at the Effective Time from Conectiv or as soon as practicable thereafter (but in no event later than 10 days after the Effective Time) from HoldCo or Surviving Corporation B in consideration for such stock option an amount in cash equal to (A) the excess, if any, of the Conectiv Common Stock Cash Consideration under Section 1.8(b)(ii) over the exercise price per share previously subject to such stock option, less any required withholding taxes, multiplied by (B) the number of shares of Purchaser Conectiv Common Stock subject to such stock option, or (ii) converted into an option to purchase a number of shares of HoldCo Common Stock (a "Purchaser Replacement OptionsConverted Option") having equal to the same product of the number of shares of Conectiv Common Stock subject to such stock option and the number of shares of HoldCo Common Stock equal to the Conectiv Common Stock Exchange Ratio under Section 1.8(b)(ii) (provided that any fractional share resulting from such multiplication shall be rounded up or down to the nearest whole share). The terms and conditions of the Converted Option shall remain the same as the Company Options (including such terms and conditions as may be incorporated by reference into of the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) related stock option of Conectiv, except that the exercise price and per share of each Converted Option shall equal the exercise price per share of such stock option divided by the number of shares issuable upon of HoldCo Common Stock equal to the Conectiv Common Stock Exchange Ratio under Section 1.8(b)(ii) (provided that such exercise price shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded down to the nearest whole cent or number, respectivelycent). Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser HoldCo shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser HoldCo Common Stock for delivery upon the exercise of Purchaser Replacement the Converted Options. HoldCo shall use its best efforts to cause the registration of the shares of HoldCo Common Stock subject to the Converted Options after to become effective as part of the Effective Time. Promptly after Form S-4, or on the Effective Timesame date as the Form S-4 is declared effective; and, Purchaser thereafter, HoldCo shall file one or cause to be filed all more registration statements on Form S-8 or other appropriate form as may be necessary in connection forms with the purchase and sale respect to shares of Purchaser HoldCo Common Stock contemplated by such Purchaser Replacement Options subsequent subject to the Effective Time, Converted Options and shall use its best efforts to maintain the effectiveness of such registration statement or registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Converted Options registered thereunder remain outstanding. Conectiv and HoldCo shall take all such steps as may be required to cause the transactions contemplated by this Section 5.6 and any other dispositions of Conectiv equity securities (including derivative securities) or acquisitions of HoldCo equity securities (including derivative securities) in connection with this Agreement by each individual who (i) is a director or officer of Conectiv or (ii) at the Effective Time will become a director or officer of HoldCo to become exempt under Rule 16b-3 promulgated under the Exchange Act. As soon as practicable after the Effective Time, Purchaser HoldCo shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) deliver or cause to be exempt from the application delivered to each holder of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at Converted Options an exercise price for each appropriate notice setting forth such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, holder's rights pursuant to the Company ESPPConectiv Stock Option Plan and agreements evidencing the grants of such Converted Options, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior after giving effect to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1transactions hereunder.

Options. (a) Except On or within sixty (60) days following your Start Date you shall be granted a stock option (the “Option”) to purchase 279,000 shares of Allogene’s common stock, par value $0.001 per share (the “Common Stock”) (the “Option Shares”) pursuant to the Company’s 2017 Equity Incentive Plan (the “Plan”). Such grant shall be evidenced by an option agreement (the “Option Agreement”) to be entered into by and between you and the Company. The exercise price per Option Share will be equal to the fair market value per share of the Company’s Common Stock as provided of the date that such Option is granted. The Option shall have a 10-year term and shall vest and become exercisable as follows: (i) 25% upon the first anniversary of your Start Date (the “Initial Vesting Date”); and thereafter (ii) the remaining unvested Options Shares shall vest in paragraph 36 substantially equal monthly installments as of the last calendar day of each month following the Initial Vesting Date. (b) below All Options shall be immediately exercisable with respect to one hundred percent (100%) of the Company's 1996 Employee Option Shares in exchange for restricted shares of Common Stock Purchase Plan, as amended of the Company (the "Company ESPP"“Restricted Shares”); provided, at however, that the Effective TimeRestricted Shares will be subject to vesting in accordance with the schedule described above. Upon termination of your employment, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options shall have the right to repurchase any Restricted Shares that have not vested as of such termination (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant “Unvested Shares”) at a price equal to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and per Option Share (the number of shares issuable upon exercise shall be divided and multiplied, respectively, “Repurchase Right”). (c) In the event that your employment is terminated by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act without Cause (as defined below) to be exempt from or by you for Good Reason (as defined below) at any time beginning on the application of Section 16(b) of the Securities Exchange Act, date that is 90 days prior to the extent permitted thereundereffective date of a Change of Control (as defined in the Plan) and ending on the date that is 12 months following the Change of Control, then (i) all unvested Restricted Stock and Option Shares shall immediately vest in full, and (ii) all Options will remain exercisable for a period of 90 calendar days following the date of such termination, after which time the Option shall expire; provided, however, that no such Option shall be exercisable after the expiration of its maximum term. In order to give effect to the foregoing provision, notwithstanding anything to the contrary set forth in any agreement governing an equity award regarding immediate forfeiture of unvested shares upon termination of service or the duration of post-termination of service exercise periods, following any termination of your employment, none of your equity incentive awards shall terminate with respect to any vested or unvested portion subject to such equity award before 90 days following such termination. (bd) The current offerings in process as of the date For purposes of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.Agreement:

Options. (aA) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at From and after the Effective Time, each all employee and director stock options to purchase shares of Company Common Stock (each, a "Company Option"), which are then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receiveunexercised, by virtue of the Merger and shall, without any further action on the part of the holder holders thereof, be converted into and become options exercisable for to purchase shares of Purchaser Stock First Union Common Stock, and First Union shall assume each such Company Option in accordance with the terms of the applicable Previously Disclosed Compensation and Benefit Plans ("Purchaser Replacement Options"as hereinafter defined) having the same terms and conditions as the Company Options (related agreements by which it is evidenced, including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant but not limited to the plans or arrangements pursuant to which accelerated vesting of such Company Options were grantedwhich shall occur in connection with and by virtue of the Merger as and to the extent required by such Previously Disclosed Compensation and Benefit Plans; provided, however, that from and after the Effective Time -------- ------- (i) except that the exercise price and each such Company Option assumed by First Union may be exercised solely to purchase shares of First Union Common Stock, (ii) the number of shares issuable of First Union Common Stock purchasable upon exercise of such Company Option shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded equal to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure number of shares of Company Common Stock that any were purchasable under such Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") Option immediately prior to the Effective Time continue multiplied by the Exchange Ratio and rounding to so qualify after the nearest whole share, and (iii) the per share exercise price under each such Company Option shall be adjusted by dividing the per share exercise price of each such Company Option immediately prior to the Effective TimeTime by the Exchange Ratio, and rounding to the nearest whole cent. Purchaser shall take all corporate action necessary The terms of each Company Option shall, in accordance with its terms, be subject to reserve for issuance a sufficient further adjustment as appropriate to reflect any stock split, stock dividend, recapitalization, merger, reorganization or other similar transaction with respect to First Union Common Stock on or subsequent to the Effective Date. Notwithstanding the foregoing, the number of shares and the per share exercise price of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause each Company Option which is intended to be filed all registration statements on Form S-8 or other appropriate form an "incentive stock option" (as may defined in Section 422 of the Code) shall be necessary adjusted in connection accordance with the purchase requirements of Section 424 of the Code. Accordingly, with respect to any incentive stock options, fractional shares shall be rounded down to the nearest whole number of shares and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent where necessary the per share exercise price shall be rounded up to the nearest cent. (B) Prior to the Effective Time, First Union shall reserve for issuance the number of shares of First Union Common Stock necessary to satisfy First Union's obligations under Section 2.06(A). Promptly after --------------- the Effective Time, First Union shall file with the SEC a registration statement on an appropriate form under the Securities Act with respect to the shares of First Union Common Stock subject to options to acquire First Union Common Stock issued pursuant to Section 2.06(A) hereof, and shall maintain the effectiveness of such registration statements (and use --------------- its reasonable best efforts to maintain the current status of the prospectus or prospectuses contained therein) , as well as comply with any applicable state securities or "blue sky laws", for so long as any of the Purchaser Replacement Options registered thereunder such options remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by Edify to purchase shares of Edify Common Stock which is outstanding and unexercised immediately prior thereto, whether or not vested, shall be converted automatically into an option to purchase shares of S1 Common Stock in an amount and at an exercise price determined as provided below (and otherwise subject to the terms of the 1996 Equity Incentive Plan (the "Company Options1996 Equity Plan"), the 1996 Directors Stock Option Plan (the "Directors Plan"), or the 1990 Stock Option Plan (the "1990 Option Plan"), as the case may be, (the 1996 Equity Plan, the Directors Plan and the 1990 Option Plan, collectively, the "Edify Stock Plans")): (1) exercisable for The number of shares of Company S1 Common Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant subject to the plans or arrangements pursuant option immediately after the Effective Time shall be equal to which such Company Options were granted) except that the exercise price and product of the number of shares issuable upon exercise of Edify Common Stock subject to the option immediately before the Effective Time, multiplied by the Exchange Ratio, provided that any fractional shares of S1 Common Stock resulting from such multiplication shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded down to the nearest whole cent or numbershare; and (2) The exercise price per share of S1 Common Stock under the option immediately after the Effective Time shall be equal to the exercise price per share of Edify Common Stock under the option immediately before the Effective Time divided by the Exchange Ratio, respectivelyprovided that such exercise price shall be rounded up to the nearest cent. Purchaser The adjustment provided herein shall use all reasonable efforts be and is intended to ensure that any Company Options that qualified as incentive stock options under be effected in a manner which is consistent with Section 422 424(a) of the Internal Revenue Code of 1986, as amended (the "Code"). The duration, vesting schedule, exercisability and other terms of the option immediately after the Effective Time shall be the same as the corresponding terms in effect immediately before the Effective Time, except that all references to Edify in the Edify Stock Plans (and the corresponding references in the option agreement documenting such option) shall be deemed to be references to S1. Except as set forth in Section 1.6 of the Edify Disclosure Schedule, vesting of stock options under the Edify stock plans shall not be accelerated as a result of the Merger. Continuous employment with Edify or its subsidiaries shall be credited to the optionee for purposes of determining the vesting of all assumed Edify options after the Effective Time. It is intended that Edify options assumed by S1 shall qualify following the Effective Time as incentive stock options are defined in Section 422 of the Code to the extent such options qualified as such prior to the Effective Time continue to so qualify after and the Effective Timeprovisions of this Section 1.6 shall be applied consistently with such intent. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly As soon as reasonably practicable, but in no event more than 30 days after the Effective Time, Purchaser shall file or cause S1 will issue to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with each holder of an assumed option notice of the purchase and sale of Purchaser Stock contemplated foregoing assumption by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness S1 of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderEdify option. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. Schedule 2.8 of the Camco Disclosure Schedules (adefined hereafter) Except as provided in paragraph sets forth all of the Camco stock option plans (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms“Camco Option Plans”) and Purchaser shall cause each holder of a Company Option all grantees holding unexercised and unexpired options to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser acquire Camco Common Stock ("Purchaser Replacement “Camco Options"”) having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement (“Camco Optionholder”), including the name of each such Camco Optionholder, the date on which each Camco Option was granted, the expiration date of each Camco Option, the price at which each Camco Option may be exercised under the Company ESPP Camco Option Plans, the number of shares of Camco Common Stock subject to each Camco Option and the status of the Camco Option grant as qualified or non-qualified under Section 422 of the Code. Upon the Effective Date, each Camco Option which is then outstanding shall continuecease to represent a right to acquire shares of Camco Common Stock and shall be converted automatically into an option to purchase shares of First Place Common Stock, and Company Shares First Place shall assume each such Camco Option, in accordance with the terms of the Camco Stock Option Plans and stock option or other agreement by which it is evidenced, except that from and after the Effective Time, (i) First Place and the Compensation Committee of its Board of Directors shall be issued to participants thereunder on substituted for Camco and the next currently scheduled purchase dates thereunder occurring after committee of the date hereof as provided underBoard of Directors of Camco (including, and if applicable, the entire Board of Directors of Camco) administering such Camco Option Plans, (ii) each Camco Option assumed by First Place may be exercised solely for shares of First Place Common Stock, (iii) the number of shares of First Place Common Stock subject to such Camco Option shall be equal to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and number of shares of Camco Common Stock subject to such Camco Option immediately prior to the Effective Time at an multiplied by the Exchange Ratio (as may be adjusted), provided that any fractional shares of First Place Common Stock resulting from such multiplication shall be rounded down to the nearest share, and (iv) the per share exercise price for under each such offering not less than Camco Option shall be adjusted by dividing the per share exercise price under each such Camco Option by the Exchange Ratio (as is required under the Company ESPP. Immediately prior may be adjusted), provided that such exercise price shall be rounded up to the Effective Timenearest cent. Notwithstanding clauses (iii) and (iv) of the preceding sentence, pursuant to the Company ESPP, all offerings under the Company ESPP (i) each Camco Option shall be terminatedadjusted in compliance with Section 409A of the Code, and the regulations promulgated thereunder, and (ii) each participant Camco Option which is an “incentive stock option” shall be deemed adjusted as required by Section 424 of the Code, and the regulations promulgated thereunder, so as not to have purchased immediately prior constitute a modification, extension or renewal of the option within the meaning of Section 424(h) of the Code. First Place and Camco agree to take all necessary steps to effect the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the foregoing provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in this Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 12.8.

Options. (aAll outstanding RedChip Options as of the date of this Agreement are set forth on Schedule 2.6(c) attached hereto. Each outstanding RedChip Option granted under the RedChip Stock Option Plan shall, in accordance with the terms of the RedChip Stock Option Plan, at the Effective Time, become fully vested and exercisable at the exercise price and for the number of shares of RedChip Stock set forth in the respective RedChip Stock Option Agreements under which they were granted. Any shares of RedChip Stock for which such RedChip Options are exercised prior to the Effective Time shall be deemed to be issued and outstanding immediately prior to the Effective Time, even if certificates evidencing such RedChip Stock have not been issued by RedChip and, at the Effective Time, such shares of RedChip Stock shall be converted into Merger Shares in accordance with Section 2.6 hereof, subject to the provisions of Section 2.6(h) hereof, related to fractional shares. Except to the extent exercised prior to the Effective Time as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP")foregoing sentence, at the Effective Time, each then outstanding RedChip Option shall terminate and unexercised option (shall cease to represent the "Company Options") exercisable for right to acquire shares of Company Stock RedChip Stock. FRT shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause grant to each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company RedChip Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company who did not exercise his or her RedChip Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after (and which were terminated at the Effective Time. Purchaser shall take all corporate action necessary ) options (the "Substitute Options") to reserve for issuance a sufficient purchase the number of shares of Purchaser FRT Stock for delivery upon as the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness holder of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement RedChip Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser would have been entitled to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, receive pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased Merger had such holder exercised such RedChip Options in full immediately prior to the Effective Time, at a price per share equal to the extent result of payroll deductions accumulated by such participant as multiplying the per share exercise price of such offering RedChip Option by the Exchange Ratio (rounded to the nearest full cent). The Substitute Options shall vest as follows: (i) for the RedChip Options which were vested immediately prior to the Effective Time (without regard to the acceleration of vesting due to the Merger), the Substitute Options shall be immediately exercisable at the time of grant and (ii) for the RedChip Options which were unvested immediately prior to the Effective Time (without regard to the acceleration of vesting due to the Merger), the Substitute Options shall vest over the shorter period endof (x) the two year period beginning at the Effective Time and (y) the vesting schedule of the original RedChip Options (without regard to any acceleration thereof). Notwithstanding the foregoing, the number of whole and the per share exercise price of each RedChip Option which is an "incentive stock option" (as defined in Section 422 of the Code) shall be adjusted in accordance with the requirements of Section 424 of the Code, as necessary in order for such RedChip Option to be an "incentive stock option." Accordingly, with respect to any incentive stock options, fractional shares of Company FRT Stock at a shall be rounded down to the nearest whole number of shares and, where necessary, the per share exercise price determined pursuant shall be rounded up to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1nearest cent.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option or warrant granted by SKAN to purchase shares of SKAN Common Stock which is outstanding and unexercised immediately prior thereto shall be converted automatically into an option to purchase shares of BSB Bancorp Common Stock in an amount and at an exercise price determined as provided below (and otherwise subject to the terms of the 1995 Non-Employee Directors Warrant Plan and 1998 Non-Employee Directors Warrant Plan, the 1998 Stock Option Plan, the 1991 Long Term Incentive and Capital Accumulation Plan and the 1987 Long Term Incentive and Capital Accumulation Plan (collectively, all such plans are referred to as the "Company OptionsSKAN Stock Plans"); (1) exercisable for The number of shares of Company BSB Bancorp Common Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant subject to the plans option or arrangements pursuant warrant immediately after the Effective Time shall be equal to which such Company Options were granted) except that the exercise price and product of the number of shares issuable upon exercise of SKAN Common Stock subject to the option or warrant immediately before the Effective Time, multiplied by the Exchange Ratio, provided that any fractional shares of BSB Bancorp Common Stock resulting from such multiplication shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded down to the nearest whole cent share; and (2) The exercise price per share of BSB Bancorp Common Stock under the option or numberwarrant immediately after the Effective Time shall be equal to the exercise price per share of SKAN Common Stock under the option or warrant immediately before the Effective Time divided by the Exchange Ratio, respectivelyprovided that such exercise price shall be rounded down to the nearest cent. Purchaser The adjustment provided herein shall use all reasonable efforts be and is intended to ensure that any Company Options that qualified as incentive stock options under be effected in a manner which is consistent with Section 422 424(a) of the Internal Revenue Code of 1986, as amended (the "Code"). The duration and other terms of the option or warrant immediately after the Effective Time shall be the same as the corresponding terms in effect immediately before the Effective Time, except that all references to SKAN or Skaneateles Bank in the SKAN Stock Plans (and the corresponding references in the option or warrant agreement documenting such option or warrant) shall be deemed to be references to BSB Bancorp. Nothing herein shall be construed as preventing option or warrant holders from exercising the same prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection accordance with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderterms thereof. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except The Buyer shall have the option for the construction by the Builder of one additional vessel as provided stated in paragraph Box 27 at the delivery date and the contract price stated in Box 28 (b) below with respect to the Company's 1996 Employee Stock Purchase Plandelivery date and the contract price, as amended (the "Company ESPP"Clause 46(b)-(f) below shall however apply), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action but otherwise on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as this Contract with logical amendments. Such option must be declared by the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant Buyer to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and Builder within the number of shares issuable upon exercise shall be divided and multiplied, respectively, by months stated in Box 29 following the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 effective date of the Internal Revenue Code this Contract (see Clause 44 (Effective date of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderContract). (b) The current offerings Parties agree that the contract price for the option vessel shall be the contract price stated in process Box 28. However, if there is any variation to any of the prices that are charged to the Builder by the suppliers of the major pieces of equipment as set out in Annex F (Price of Major Equipment N1130) between the date of this Agreement under Contract and the Company ESPP shall continue, and Company Shares date of the shipbuilding contract to be entered into for the option vessel then the contract price for the option vessel shall be issued revised accordingly (upwards or downwards, as applicable). The Builder must provide documentation proving the variations. (c) Furthermore, if there is: (i) [REDACTED] (ii) [REDACTED] (iii) [REDACTED] then Annex E (Price Variation Mechanism for Option Vessel) shall be applied in order to participants thereunder determine whether (and in the affirmative to what extent) the contract price for the option vessel shall be revised, upwards or downwards, due to these variations. The Builder must provide documentation proving the variations. (d) Furthermore, if the price charged to the Builder for the leg rack and scale plating material for the chords (the price charged for the material only, excluding fabrication, cutting, bending and welding and other costs) on the next currently scheduled purchase dates thereunder occurring date when the option is declared by the Buyer is higher or lower than the highest of the following amounts by more than 3%: · [REDACTED] · [REDACTED] · [REDACTED] then the contract price for the option vessel shall be revised accordingly for the amount in excess of the 3% (upwards or downwards, as applicable). The Builder must provide documentation proving the abovementioned prices. (e) If the contract price for the option vessel shall be revised upwards or downwards due to any of the variations/price changes set out in Clause 46(b)-(d), the Builder shall notify the Buyer in writing no later than 30 calendar days after the date hereof Buyer has declared the option (and in any event before the shipbuilding contract for the option vessel is signed). Such notice shall include the revised contract price and the necessary calculations in that respect as provided underwell as documentation proving the variations/price changes. If the Builder does not provide such notice before the expiry of the deadline (no later than 30 calendar days after the Buyer has declared the option and in any event before the shipbuilding contract for the option vessel is signed), the Builder shall not be entitled to demand that the contract price is revised upwards. The Buyer is not obliged to accept the revised contract price. If the Buyer considers that the revised contract price is not acceptable, the Buyer shall be entitled to withdraw the declaration of the option and subject neither Party shall have any liability to the terms other whatsoever or howsoever arising in that regard. The Buyer shall inform the Builder whether it accepts the revised contract price within 10 working days after the Buyer has received the Builder's notice with correct calculations and conditions offull documentation as set out above. If the Buyer does not accept the revised contract price, or if the Buyer does not inform the Builder whether it accepts the revised contract price within 10 working days after the Buyer has received the Builder's notice with correct calculations and full documentation as set out above, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant Buyer shall be deemed to have purchased immediately prior withdrawn the declaration of the option and neither Party shall have any liability to the Effective Timeother whatsoever or howsoever arising in that regard. The Buyer is always entitled to request - and the Builder shall promptly deliver - the documentation which is necessary to ascertain whether there have been any relevant variations/price changes. (f) The Parties agree that the delivery date for the option vessel shall be the delivery date stated in Box 28. However, if the Builder is unable to meet this delivery date when the Buyer declares the option due to the extent delivery schedules/slots of payroll deductions accumulated by the Sub-Contractors supplying the major pieces of equipment set out in Annex F (Price of Major Equipment N1130), then the Builder shall notify the Buyer in writing no later than 30 calendar days after the Buyer has declared the option (and in any event before the shipbuilding contract for the option vessel is signed). The notice shall include a proposal for a new delivery date, which shall be reasonable considering the aforementioned delivery schedules/slots. Documentation for the delivery schedules/slots of the Sub-Contractors shall also be included. If the Builder does not provide such participant as notice before the expiry of such offering period endthe deadline (no later than 30 calendar days after the Buyer has declared the option and in any event before the shipbuilding contract for the option vessel is signed), the number delivery date shall be the delivery date stated in Box 28 (7 months after the Contractual Date of whole shares Delivery in this Contract). The Buyer is not obliged to accept the Builder's proposal for a new delivery date. If the Buyer considers that the new delivery date is not acceptable, the Buyer shall be entitled to withdraw the declaration of Company Stock at a per share price determined pursuant the option and neither Party shall have any liability to the provisions other whatsoever or howsoever arising in that regard. The Buyer shall inform the Builder whether it accepts the Builder's proposal for a new delivery date within 10 working days after the Buyer has received the Builder's notice with reasonable proposal and full documentation as set out above. If the Buyer does not accept the Builder's proposal for a new delivery date, or if the Buyer does not inform the Builder whether it accepts the new delivery date within 10 working days after the Buyer has received the Builder's notice with reasonable proposal and full documentation as set out above, the Buyer shall be deemed to have withdrawn the declaration of the Company ESPP, option and each participant neither Party shall receive a cash payment equal have any liability to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock other whatsoever or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided howsoever arising in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1that regard.

Options. (a) Except The Company shall take all reasonable commercial actions necessary to provide that all then outstanding options to acquire Shares (the “Company Options”) granted under the Company’s stock option plans referred to in Section 2.14 of the Company Disclosure Letter (as provided hereinafter defined), each as amended (collectively, the “Company Option Plans”), whether or not then exercisable or vested, shall become fully exercisable and vested no later than immediately prior to the Closing. The Company shall take all reasonable commercial actions to enable each holder of Company Options to exercise his or her Company Options so as to permit the holder of Company Options to tender into the Offer the Shares received upon exercise. The Offer Documents which shall be delivered to each Non-Executive Optionholder (as hereinafter defined) shall include separate provisions pursuant to which each person holding any Company Options (other than the members of the Company’s Board of Directors and the Company’s executive officers) (such persons are hereinafter collectively referred to as the “Non-Executive Optionholders”) may elect to (i) exercise, against delivery to the Company of an undertaking to pay the Aggregate Exercise Price (as hereinafter defined) no later than the Closing Date, and otherwise on the terms set forth in paragraph this Section 1.6(a), any and all Company Options held by such Non-Executive Optionholder, such election to become effective no later than immediately prior to the Closing Date and (bii) below tender into the Offer any Shares received upon the exercise of such Company Options. The Offer Documents delivered to each Non-Executive Optionholder shall require each Non-Executive Optionholder electing to tender Shares received upon exercise of Company Options in accordance with the preceding sentence to instruct and authorize the disbursing or other agent handling the Offer on behalf of the Company) regarding payment and remittance of the aggregate proceeds (with respect to each Non-Executive Optionholder, the “Aggregate Proceeds”) to which such Non-Executive Optionholder shall be entitled with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which Shares underlying all such Company Options were grantedvalidly tendered and not withdrawn in the Offer. The Offer Documents shall authorize that (x) except that the exercise price and the number of shares issuable upon exercise there shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded remitted to the nearest whole cent or numberCompany such Aggregate Proceeds, respectively. Purchaser shall use all reasonable efforts to ensure that any (y) the Company Options that qualified as incentive stock options under Section 422 retain, in satisfaction of the Internal Revenue Code undertaking of 1986such Non-Executive Optionholder, as amended (the "Code") prior aggregate exercise price, plus interest, if necessary, payable to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery Company upon the exercise of Purchaser Replacement such Company Options after (with respect to each Non-Executive Optionholder, the Effective Time“Aggregate Exercise Price”) and (z) the Company remit to the subsidiary of the Company employing such Non-Executive Optionholder (the “Employing Subsidiary”) an aggregate amount equal to the difference between the (A) Aggregate Proceeds and (B) Aggregate Exercise Price (the difference between (A) and (B) is hereinafter referred to as the “Net Amount”). Promptly after following receipt of the Effective TimeNet Amount, Purchaser the Employing Subsidiary shall file or cause remit and pay to the Non-Executive Optionholder such amount, net of any applicable taxes payable by such Non-Executive Optionholder (which taxes are required to be filed all registration statements withheld or otherwise paid by the Employing Subsidiary on Form S-8 or other appropriate form as may be necessary behalf of such Non-Executive Optionholder) in connection with the Purchaser’s purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain Non-Executive Optionholder’s Shares in the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderOffer. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof Except as provided under, and subject herein or as otherwise agreed to by the terms and conditions ofparties, the Company ESPP. The shall use reasonable commercial efforts to ensure that as soon as possible following the Closing no holder of Company may, consistent with past practice, commence new offering periods under Options or any participant in the Company ESPP on or after the date hereof and prior Option Plans shall have any right thereunder to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions acquire any equity securities of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1subsidiary thereof.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then outstanding and unexercised option (the "Company Options"each, a “Premier Stock Option”) exercisable for to purchase shares of Company Premier Common Stock under any and all plans of Premier under which stock options have been granted and are outstanding (collectively, the “Premier Stock Plans”) shall become fully vested vest pursuant to the terms thereof and exercisable shall be converted into an option (by virtue of their termseach, a “Replacement Option”) and Purchaser shall cause each holder of a Company Option to receiveacquire, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options were applicable under such Premier Stock Option (including such terms and conditions other than any requirement that an option be exercised within a specific time period after termination of employment or cessation of service as may a non-employee director which requirement shall be incorporated waived or deleted from each option by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and amendment thereto), the number of shares issuable upon exercise of United Common Stock equal to (a) the number of shares of Premier Common Stock subject to the Premier Stock Option, multiplied by (b) the Exchange Ratio. Such product shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number. The exercise price per share (rounded to the nearest whole cent) of each Replacement Option shall equal (y) the exercise price per share for the shares of Premier Common Stock which were purchasable pursuant to such Premier Stock Option divided by (z) the Exchange Ratio. Notwithstanding the foregoing, respectively. Purchaser shall use all reasonable efforts each Premier Stock Option which is intended to ensure that any Company Options that qualified as be an “incentive stock options under option” (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary adjusted in connection accordance with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) 424 of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPPCode. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on At or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, Premier shall use its reasonable best efforts, including using its reasonable best efforts to obtain any necessary consents from optionees, with respect to the Premier Stock Plans to permit the replacement of the outstanding Premier Stock Options by United pursuant to this Section and to permit United to assume the Company ESPP, Premier Stock Plans. Premier shall further take all offerings under action necessary to amend the Company ESPP shall be terminated, and each participant shall be deemed Premier Stock Plans to have purchased immediately prior to eliminate automatic grants or awards thereunder following the Effective Time. At the Effective Time, to United shall assume the extent of payroll deductions accumulated by Premier Stock Plans; provided, that such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions assumption shall be only in respect of the Company ESPP, Replacement Options and each participant that United shall receive a cash payment equal have no obligation with respect to any awards under the balance, if any, of Premier Stock Plans other than the Replacement Options and shall have no obligation to make any additional grants or awards under such accumulated payroll deductions remaining assumed Premier Stock Plans. (b) At all times after such purchase of such shares. As of the Effective Time, each participant United shall receive, by virtue of the Merger, the reserve for issuance such number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser United Common Stock as provided necessary so as to permit the exercise of options granted under the Premier Stock Plans in Section 1.5(h) hereof, plus any dividends or distributions the manner contemplated by this Agreement and the instruments pursuant to which such options were granted. United shall make all filings required under federal and state securities laws no later than the Effective Time so as provided in Section 1to permit the exercise of such options and the sale of the shares received by the optionee upon such exercise at and after the Effective Time and United shall continue to make such filings thereafter as may be necessary to permit the continued exercise of options and sale of such shares.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then outstanding and unexercised option (each, a "Century Option") to purchase shares of Century Common Stock under any and all plans of Century under which stock options have been granted and are outstanding (collectively, the "Company OptionsCentury Stock Plans") exercisable for shares of Company Stock shall become fully vested vest pursuant to the terms thereof and exercisable shall be converted into an option (by virtue of their terms) and Purchaser shall cause each holder of each, a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement OptionsOption") having to acquire, on the same terms and conditions as the Company Options were applicable under such Century Stock Option (including such terms and conditions other than any requirement that an option be exercised within a specific time period after termination of employment or cessation of service as may a non-employee director, which requirement shall be incorporated waived or deleted from each option by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and amendment thereto), the number of shares issuable upon exercise of United Common Stock equal to (a) the number of shares of Century Common Stock subject to the Century Stock Option, multiplied by (b) 0.5894 (the "Option Exchange Ratio"). Such product shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number. The exercise price per share (rounded to the nearest whole cent) of each Replacement Option shall equal (y) the exercise price per share for the shares of Century Common Stock which were purchasable pursuant to such Century Stock Option divided by (z) the Option Exchange Ratio. Notwithstanding the foregoing, respectively. Purchaser shall use all reasonable efforts each Century Stock Option which is intended to ensure that any Company Options that qualified as be an "incentive stock options under option" (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary adjusted in connection accordance with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) 424 of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPPCode. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on At or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, Century shall use its reasonable best efforts, including using its reasonable best efforts to obtain any necessary consents from optionees, with respect to the Century Stock Plans to permit the replacement of the outstanding Century Stock Options by United pursuant to this Section and to permit United to assume the Company ESPP, Century Stock Plans. Century shall further take all offerings under action necessary to amend the Company ESPP shall be terminated, and each participant shall be deemed Century Stock Plans to have purchased immediately prior to eliminate automatic grants or awards thereunder following the Effective Time. At the Effective Time, to United shall assume the extent of payroll deductions accumulated by Century Stock Plans; provided, that such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions assumption shall be only in respect of the Company ESPP, Replacement Options and each participant that United shall receive a cash payment equal have no obligation with respect to any awards under the balance, if any, of Century Stock Plans other than the Replacement Options and shall have no obligation to make any additional grants or awards under such accumulated payroll deductions remaining assumed Century Stock Plans. (b) At all times after such purchase of such shares. As of the Effective Time, each participant United shall receive, by virtue of the Merger, the reserve for issuance such number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser United Common Stock as provided necessary so as to permit the exercise of options granted under the Century Stock Plans in Section 1.5(h) hereof, plus any dividends or distributions the manner contemplated by this Agreement and the instruments pursuant to which such options were granted. United shall make all filings required under federal and state securities laws no later than the Effective Time so as provided in Section 1to permit the exercise of such options and the sale of the shares received by the optionee upon such exercise at and after the Effective Time and United shall continue to make such filings thereafter as may be necessary to permit the continued exercise of options and sale of such shares.

Options. All options to purchase shares of Company Common Stock (aeach, a “Company Stock Option”) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Planoutstanding, as amended (the "Company ESPP")whether or not exercisable and whether or not vested, at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of issued under any Company Stock Plan and any other plan or agreement pursuant to which Company Stock Options have been issued, in each case as such may have been amended, supplemented or modified, shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a remain outstanding following the Effective Time. At the Effective Time, the Company Option to receiveStock Options shall, by virtue of the Merger and without any further action on the part of the Company or the holder thereof, options be assumed by Acquiror in such manner that Acquiror (i) is a corporation “assuming a stock option in a transaction to which Section 424(a) applies” within the meaning of Section 424 of the Code and the regulations thereunder or (ii) to the extent that Section 424 of the Code does not apply to any such Company Stock Options, would be such a corporation were Section 424 of the Code applicable to such Company Stock Options. From and after the Effective Time, all references to the Company in the Company Stock Option Plans and the applicable stock option agreements issued thereunder shall be deemed to refer to Acquiror, which shall have assumed the Company Stock Option Plans as of the Effective Time by virtue of this Agreement and without any further action. Each Company Stock Option assumed by Acquiror (each, a “Substitute Option”) shall be exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having upon the same terms and conditions as under the applicable Company Options Stock Option Plan and the applicable option agreement issued thereunder, except that (including A) each such terms Substitute Option shall be exercisable for, and conditions as may be incorporated by reference into represent the agreements evidencing the Company Options pursuant right to acquire, that whole number of shares of Acquiror Common Stock (rounded upward to the plans or arrangements pursuant nearest whole share) equal to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise of Company Common Stock subject to such Company Stock Option multiplied by the Common Stock Exchange Ratio; and (B) the option price per share of Acquiror Common Stock shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded an amount equal to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts option price per share of Company Common Stock subject to ensure that any such Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") Stock Option in effect immediately prior to the Effective Time continue to divided by the Common Stock Exchange Ratio (the option price per share, as so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Timedetermined, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent being rounded upward to the Effective Time, and nearest whole cent). Such Substitute Option shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons otherwise be subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the same terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each as such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Option.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each all employee and director stock options to purchase shares of KSB Common Stock (each, a KSB Stock Option ), which are then outstanding and unexercised option (the "Company Options") exercisable for unexercised, shall cease to represent a right to acquire shares of Company KSB Common Stock, and shall be converted automatically into options to purchase shares of Camden Common Stock, and Camden shall assume each such KSB Stock shall become fully vested and exercisable (by virtue Option subject to the terms of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue any of the Merger stock option plans listed under Stock Plans in Section 3.7 of KSB s Disclosure Schedule (collectively, the KSB Stock Option Plans ), and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing grants thereunder; provided, however, that from and after the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were grantedEffective Time, (i) except that the exercise price and the number of shares issuable of Camden Common Stock purchasable upon exercise of any such KSB Stock Option shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded equal to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure number of shares of KSB Common Stock that any Company Options that qualified as incentive stock options were purchasable under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") such KSB Stock Option immediately prior to the Effective Time continue multiplied by the Exchange Ratio, rounding to so qualify after the nearest whole share (with .5 being rounded up), and (ii) the per share exercise price under each such KSB Stock Option shall be adjusted by dividing the per share exercise price of each such KSB Stock Option by the Exchange Ratio, rounding to the nearest cent. The terms of each KSB Stock Option shall, in accordance with its terms, be subject to further adjustment as appropriate to reflect any stock split, stock dividend, recapitalization or other similar transaction with respect to Camden Common Stock on or subsequent to the Effective Date. Notwithstanding the foregoing, the number of shares and the per share exercise price of each KSB Stock Option which is intended to be an incentive stock option (as defined in Section 422 of the Code) shall be adjusted in accordance with the requirements of Section 424(a) of the Code. Accordingly, with respect to any incentive stock options, fractional shares shall be rounded down to the nearest whole number of shares and where necessary the per share exercise price shall be rounded up to the nearest cent. (b) At or prior to the Effective Time. Purchaser , Camden shall take all corporate action necessary to reserve for issuance a sufficient the number of shares of Purchaser Camden Common Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Timenecessary to satisfy Camden s obligations under Section 3.7(a). Promptly after At the Effective Time, Purchaser or as soon as practicable thereafter, and in any event within fifteen business days thereafter, Camden shall file or cause to be filed all with the SEC a registration statements statement on Form S-8 or other appropriate form as may be necessary in connection under the Securities Act with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent respect to the Effective Timeshares of Camden Common Stock subject to options to acquire Camden Common Stock issued pursuant to Section 3.7(a) hereof, and shall maintain the effectiveness of such registration statements (and use its best efforts to maintain the current status of the prospectus or prospectuses contained therein) , as well as comply with any applicable state securities or blue sky laws, for so long as any of the Purchaser Replacement Options registered thereunder such options remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "The Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company all outstanding Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process canceled as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, at which time each holder of a Vested Option (an “Optionholder”) shall, contingent upon the Closing, become entitled to receive from Parent or the Surviving Corporation (in lieu of receiving any stock of the Company) an amount in cash (adjusted down to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of nearest whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment cent) equal to the balanceproduct of (i) the excess, if any, of such accumulated payroll deductions remaining after such purchase the Common Share Price over the applicable exercise price per share of such sharesVested Option, multiplied by (ii) the number of shares of Common Stock such Optionholder could have purchased if such Optionholder had exercised such Vested Option in full immediately prior to such time, less applicable Taxes withheld (it being understood that the portion paid at Closing will be based on the Estimated Common Share price). Parent shall cause the Surviving Corporation to make timely payment to the appropriate taxing authority or authorities of any amounts withheld from payment to the Optionholders under this Section 3.1(c). The aggregate consideration to which Optionholders become entitled pursuant to this Section 3.1(c) is collectively referred to herein as the “Option Merger Consideration.” As soon as reasonably practicable following the date of this Agreement, the Company shall deliver a notice to each of the Optionholders substantially in the form attached hereto as Exhibit G (the “Optionholder Notice”). Prior to the Effective Time, each participant the Company shall receiveadopt board (or committee) resolutions resolving that, by virtue as of immediately prior to the Effective Time, (a) no Person shall have any right under the Options, the ▇▇▇ Technology Holdings, Inc. 2010 Equity Incentive Plan (the “Equity Plan”) or any other plan, program, agreement or arrangement with respect to equity securities of the MergerSurviving Corporation or any direct or indirect Subsidiary thereof, except the number of whole shares of Purchaser Stock or cash into right to receive the amounts payable under this Section 3.1(c), if any, (b) the Equity Plan terminates and (c) each Option (i) for which the shares exercise price of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant Option is greater than or equal to the Merger as provided Estimated Common Share Price or (ii) is an Unvested Option, in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1each case is terminated for no consideration.

Options. (a) Except as provided in paragraph (b) below with respect Hertz hereby grants to Ford, on the Company's 1996 Employee Stock Purchase Planterms and conditions set forth herein, as amended a continuing right (the "Company ESPPClass B Common Stock Option")) to purchase from Hertz, at the Effective Timetimes set forth herein, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Class B Common Stock as is necessary to allow the Ford Entities to maintain the percentage of the then-outstanding Common Stock of Hertz that is equal to the Ownership Percentage. The Class B Common Stock Option shall be assignable, in whole or in part and from time to time, by Ford to any Ford Entity. The exercise price for the shares of Class B Common Stock purchased pursuant to the Class B Common Stock Option shall be the Market Price of the Class A Common Stock as of the date of first delivery upon the of notice of exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file Class B Common Stock Option by Ford (or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined belowits permitted assignee hereunder) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderHertz. (b) The current offerings in process as provisions of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date Section 2.1(a) hereof as provided under, and subject to the terms and conditions ofnotwithstanding, the Company ESPP. The Company mayClass B Common Stock Option granted pursuant to Section 2.1(a) shall not apply and shall not be exercisable in connection with the issuance by Hertz of any shares of Common Stock pursuant to any stock option or other executive or employee benefit or compensation plan maintained by Hertz, consistent with past practiceso long as, commence new offering periods under the Company ESPP on or from and after the date hereof and prior to the Effective Time issuance of such shares, Hertz has repurchased from shareholders and not subsequently reissued a number of shares equal or greater to the number of shares to be issued in any such issuance. (c) Hertz hereby grants to Ford, on the terms and conditions set forth herein, a continuing right (the "Nonvoting Stock Option" and, together with the Class B Common Stock Option, the "Options") to purchase from Hertz, at an the times set forth herein, such number of shares of Nonvoting Stock as is necessary to allow the Ford Entities to own 80 percent of each class of outstanding Nonvoting Stock. The Nonvoting Stock Option shall be assignable, in whole or in part and from time to time, by Ford to any Ford Entity. The exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, shares of Nonvoting Stock purchased pursuant to the Company ESPP, all offerings under the Company ESPP Nonvoting Stock Option shall be terminatedthe price at which such Nonvoting Stock is then being sold to third parties, and each participant shall be deemed to have purchased immediately prior to the Effective Timeor, to the extent of payroll deductions accumulated by such participant as of such offering period endif no Nonvoting Stock is being sold, the number fair market value thereof as determined in good faith by the Board of whole shares Directors of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Hertz.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by Saratoga to purchase shares of Saratoga Common Stock (each, an "Saratoga Option") which is outstanding and unexercised immediately prior thereto shall cease to represent a right to acquire shares of Saratoga Common Stock and shall be converted automatically into an option to purchase shares of SJNB Common Stock in an amount and at an exercise price determined as provided below (and otherwise subject to the terms of the stock option plans of Saratoga (the "Company OptionsSaratoga Stock Option Plans") exercisable for shares and the agreements evidencing grants thereunder, including but not limited to, the accelerated vesting of Company Stock such options which shall become fully vested occur in connection with and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part consummation of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms Merger as and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the extent required by such plans or arrangements pursuant to which such Company Options were grantedand agreements): (a) except that the exercise price and the number of shares issuable upon exercise of SJNB Common Stock to be subject to the new option shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded equal to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 product of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Saratoga Common Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements original option and the Exchange Ratio, provided that any fractional shares of Section 16(aSJNB Common Stock resulting from such multiplication shall be rounded down to the nearest share; and (b) the exercise price per share of SJNB Common Stock under the Securities new option shall be equal to the exercise price per share of Saratoga Common Stock under the original option divided by the Exchange Act Ratio, provided that such exercise price shall be rounded up to the nearest cent. In the case of any options which are "incentive stock options" (as defined below) to be exempt from the application of Section 16(b) in section 422 of the Securities Exchange ActCode), the exercise price, the number of shares purchasable pursuant to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, such options and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, of exercise of such options shall be determined in order to comply with section 424(a) of the Company ESPPCode. The Company may, consistent with past practice, commence duration and other terms of the new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP option shall be terminated, and each participant the same as the original option except that all references to Saratoga shall be deemed to have purchased immediately prior be references to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1SJNB.

Options. (ai) Except Each Emergent Option that is outstanding as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at of the Effective Time, each then outstanding Time that is held by an Emergent Employee or other Emergent Business service provider shall remain an option to purchase Emergent Common Shares and unexercised option (shall be adjusted as described below to reflect the "Company Options") exercisable for shares of Company Stock Distribution. Each such Adjusted Emergent Option shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option be subject to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior applicable to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased corresponding Emergent Option immediately prior to the Effective Time; provided, however, that from and after the Effective Time: (x) the per-share exercise price of each such Adjusted Emergent Option shall be equal to the extent product of payroll deductions accumulated (I) the per-share exercise price of the corresponding Emergent Option immediately prior to the Distribution Date multiplied by such participant as of such offering period end(II) the Emergent Price Ratio, rounded up to the nearest whole cent; and (y) the number of whole shares of Company Stock at a per share price determined pursuant Emergent Common Shares subject to the provisions of the Company ESPP, and each participant such Adjusted Emergent Option shall receive a cash payment be equal to the balanceproduct of (I) the number of Emergent Common Shares subject to each such Adjusted Emergent Option immediately prior to the Effective Time multiplied by (II) the Emergent Share Ratio, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As with any fractional shares rounded down to the nearest whole share. (ii) Each Emergent Option that is outstanding as of the Effective Time that is held by an Aptevo Employee or other Aptevo Business service provider shall be converted into an option to purchase Aptevo Common Shares and shall be adjusted as described below to reflect the Distribution. Each such Aptevo Option shall be subject to the same terms and conditions after the Effective Time as the terms and conditions applicable to the corresponding Emergent Option immediately prior to the Effective Time; provided, however, that from and after the Effective Time: (x) the per-share exercise price of each participant such Aptevo Option shall receive, by virtue be equal to the product of (I) the per-share exercise price of the Mergercorresponding Emergent Option immediately prior to the Effective Time multiplied by (II) the Aptevo Price Ratio, rounded up to the nearest whole cent; and (y) the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock Aptevo Common Shares subject to each such participant has so purchased under the Company ESPP have been converted pursuant Aptevo Option shall be equal to the Merger as provided in Section 1.3(aproduct of (A) hereofthe number of Emergent Common Shares subject to the corresponding Emergent Option immediately prior to the Effective Time multiplied by (B) the Aptevo Share Ratio, plus with any fractional share rounded down to the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1nearest whole share.

Options. Concurrently and as of even date herewith, the Company shall grant to the Executive options or warrants (“Options”) covering 200,000 shares (the “Option Shares”) of the Company’s common stock, $.0001 par value (the “Common Stock”). The Options shall vest in equal monthly installments over a one-year period commencing on the Effective Date (e.g., first monthly vesting will occur on August 30, 2003), subject to the Executive continuing to be employed hereunder at the time specified for vesting, shall be exercisable to the extent then vested and shall be exercisable at an exercise price (“Exercise Price”) per Option Share equal to the closing price per share of Common Stock on the OTCBB exchange on the date which Executive commences his employment, and shall expire to the extent not theretofore exercised upon the earliest to occur of (a) Except as provided in paragraph the fourth anniversary of the Effective Date; (b) 90 days following the date of termination of the Executive’s employment for any reason other than those set forth below with respect in this Section 5.3(c) hereof; or (c) immediately in the event of any termination by the Company of the Executive’s employment pursuant to Section 8.1 or Section 8.3 hereof. The number of Option Shares and the Exercise Price thereof shall be subject to equitable and proportionate adjustment as determined by the Board from time to time to reflect stock splits, reverse stock splits, stock dividends, recapitalizations, reclassifications and similar events of dilution. The Options will not be exercisable by the Executive unless or except to the Company's 1996 Employee Stock Purchase Planextent that (a) the underlying Option Shares are registered under the Securities Act of 1933, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fractionamended, and rounded to the nearest whole cent registered or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws (collectively, the issuance “Securities Laws”), or (b) in the reasonable opinion of counsel to the Company, exemptions from the registration and qualification provisions of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement OptionsSecurities Laws are applicable to the transaction. Purchaser's The Options will also contain such investment representations by the Executive as may reasonably be requested by the Company’s counsel to insure compliance with applicable Securities Laws. The Options shall be issued pursuant to a stock option plan or stock option agreement approved by the Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to Company and will be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings contained in process a separate document in customary form dated as of the date of this Agreement under Effective Date and executed by the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder the Executive on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided underor promptly thereafter; and, and subject to the terms and conditions ofpending such execution, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant this Section 5.3 shall be deemed to have purchased immediately prior constitute the grant of and contain the terms of the Options. The grant and exercise of such Options shall be subject to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value Company’s completion of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends and all required or distributions as provided in Section 1necessary state or federal securities filings and/or disclosure documents.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by Subject Company to purchase shares of Subject Company Common Stock (each a "Subject Company Option") which is outstanding and unexercised immediately prior thereto shall cease to represent a right to acquire shares of Subject Company Common Stock and shall be converted automatically into an option to purchase shares of Parent Common Stock in an amount and at an exercise price determined as provided below (and otherwise subject to the terms of the Subject Company 1995 Performance Stock Plan, the Subject Company 1991 Performance Stock Plan (as amended), the Subject Company 1988 Performance Stock Plan (as amended), the Subject Company 1983 Performance Stock Plan (as amended), the Subject Company Performance Stock Plan of 1980 (as amended and restated) and the Subject Company 1991 Director Option Plan (as amended and restated), as the case may be (collectively, the "Company Options") exercisable for shares of Subject Company Stock Option Plans"), and the agreements evidencing grants thereunder, including, but not limited to, the accelerated vesting of such options which shall become fully vested occur in connection with and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger as and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the extent required by such plans or arrangements pursuant to which such Company Options were grantedand agreements)): (1) except that the exercise price and the number of shares issuable upon exercise of Parent Common Stock to be subject to the new option shall be divided equal to the product of the number of shares of Subject Company Common Stock subject to the original option and multipliedthe Common Exchange Ratio, respectively, by the Conversion Fraction, and provided that any fractional shares of Parent Common Stock resulting from such multiplication shall be rounded down to the nearest whole cent or numbershare; and (2) the exercise price per share of Parent Common Stock under the new option shall be equal to the exercise price per share of Subject Company Common Stock under the original option divided by the Common Exchange Ratio, respectivelyprovided that such exercise price shall be rounded up to the nearest cent. Purchaser shall use all reasonable efforts The adjustment provided herein with respect to ensure that any Company Options that qualified as options which are "incentive stock options under options" (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code")) prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause be and is intended to be filed all registration statements on Form S-8 or other appropriate form as may be necessary effected in connection a manner which is consistent with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a424(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange ActCode and, to the extent permitted thereunder. (bit is not so consistent, such Section 424(a) shall override anything to the contrary contained herein. The current offerings in process as duration and other terms of the date of this Agreement under the Company ESPP shall continue, and Company Shares new option shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after same as the date hereof as provided under, and original option (subject to the terms and conditions of, the Section 6.7(b) hereof) except that all references to Subject Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior be references to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Parent.

Options. (a) Except At the Effective Time, Parent shall assume the Company Stock Plans as provided in paragraph (b) below well as the rights, duties and obligations of the Company with respect to the Company's 1996 Employee Stock Purchase Plan, as amended administration of such plans. (the "Company ESPP"), at b) At the Effective Time, each then option granted by the Company to purchase shares of Company Common Stock (each, a“Company Option”) which is outstanding and unexercised option (the "Company Options") exercisable for immediately prior thereto, whether vested or unvested, shall cease to represent a right to acquire shares of Company Common Stock and shall become fully vested be assumed and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option be converted into an option to receiveacquire, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant were applicable to the plans or arrangements pursuant to which such original Company Options were granted) except Option, that the exercise price and number of shares of Parent Common Stock determined by multiplying the number of shares issuable upon exercise shall be divided and multiplied, respectively, of Company Common Stock subject to such Company Option immediately prior to the Effective Time by the Conversion FractionExchange Ratio, and rounded down to the nearest whole cent or numbershare of Company Common Stock, respectively. Purchaser shall use all reasonable efforts at a price per share (rounded up the nearest one-hundredth of a cent) equal to ensure the per share exercise price specified in such Company Option divided by the Exchange Ratio; provided, however, that in the case of any Company Options that qualified as incentive stock options Option to which Section 421 of the Code applies by reason of its qualification under Section 422 of the Internal Revenue Code of 1986Code, as amended (the "Code") prior to option price, the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares subject to such option and the terms and conditions of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser such option shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary determined in connection a manner consistent with the purchase and sale requirements of Purchaser Stock Section 424(a) of the Code. The parties will make good faith efforts to make equitable adjustments to ensure that the conversions of Company Options contemplated by such Purchaser Replacement Options subsequent this Section 3.4(b) comply with Section 409A of the Code. Prior to the Effective Time, and Parent shall maintain reserve for issuance the effectiveness number of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Parent Common Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on to satisfy Parent’s obligations under this Section 3.4. (c) On the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after same day as the Effective Time pursuant (if it has not done so prior thereto), Parent shall prepare and file with the SEC a registration statement on Form S-8 to Purchaser Replacement Options by persons subject to register the reporting requirements sale of Section 16(a) shares of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, Parent Common Stock issuable pursuant to the Company ESPPOptions assumed by Parent pursuant to Section 3.4(a), and Parent shall cause such registration statement to become and remain effective until the earlier of (i) the date on which all offerings such assumed Company Options are no longer outstanding and (ii) the date on which all such shares of Parent Common Stock issuable pursuant to all such assumed Company Options are tradable without restriction as to volume pursuant to Rule 144 of the Securities Act. In addition, Parent shall take further actions as may be reasonably necessary to include under such registration statement all shares of Parent Common Stock issuable pursuant to all such assumed Company Options of those persons who are directors of the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided The Lessee has the option to make advance rental payments for deposit in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue Redemption Account of the Merger and without any action on Bond Fund to effect the retirement of the Bonds in whole or the redemption in whole or in part of the holder thereofBonds, options exercisable for shares all in accordance with the terms of Purchaser Stock the Indenture; provided, however, that no partial redemption of the Bonds may be effected through advance rental payments hereunder if there shall exist and be continuing an Event of Default. The Lessee shall exercise its option to make such advance rental payments by delivering a written notice of an Authorized Representative of the Lessee to the Trustee in accordance with the Indenture, with a copy to the Agency, at least twenty ("Purchaser Replacement Options"20) having days prior to the same terms date upon which the Trustee is to mail notice of redemption to Bondholders, setting forth (i) the amount of the advance rental payment, (ii) the principal amount of Bonds Outstanding requested to be redeemed with such advance rental payment (which principal amount shall be in such minimum amount or integral multiple of such amount as shall be permitted in the Indenture), and conditions (iii) the date on which such principal amount of Bonds are to be redeemed. Such advance rental payment shall be paid to the Trustee in legal tender on or before the redemption date and shall be an amount which, when added to the amount on deposit in the Bond Fund and available therefor, will be sufficient to pay the Redemption Price of the Bonds to be redeemed, together with interest to accrue to the date of redemption and all expenses of the Agency, the Bond Registrar, the Trustee and the Paying Agents in connection with such redemption. In the event the Bonds are to be redeemed in whole or otherwise retired, the Lessee shall further pay on or before such redemption date, in legal tender, to the Agency, the Trustee, the Bond Registrar and the Paying Agents, as the Company Options case may be, all fees and expenses owed such party or any other party entitled thereto under this Agreement or the Indenture together with (including such terms i) all other amounts due and conditions as may payable under this Agreement and the other Security Documents, and (ii) any amounts required to be incorporated by reference into rebated to the agreements evidencing the Company Options Federal government pursuant to the plans Indenture or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderTax Certificate. (b) The current offerings Lessee shall have the option to terminate the Agency's leasehold interest in process the Facility commencing on that date upon which the Bonds may first optionally be redeemed in whole and on any date thereafter permitted therefor as provided in the Indenture. (c) The Lessee shall also have the option to terminate the Agency's leasehold interest in the Facility on any date during the term of this Agreement within ninety (90) days of the occurrence of any of the following events: (i) The Facility shall have been damaged or destroyed to such extent that as evidenced by a certificate of an Independent Engineer filed with the Agency and the Trustee (A) the Facility cannot be reasonably restored within a period of one year from the date of such damage or destruction to the condition thereof immediately preceding such damage or destruction, (B) the Lessee is thereby prevented or likely to be prevented from carrying on its normal operation of the Facility for a period of one year from the date of such damage or destruction, or (C) the restoration cost of the Facility would exceed the total amount of all insurance proceeds, including any deductible amount, in respect of such damage or destruction; or (ii) Title to, or the temporary use of, all or substantially all of the Facility shall have been taken or condemned by a competent authority which taking or condemnation results, or is likely to result, in the Lessee being thereby prevented or likely to be prevented from carrying on its normal operation of the Facility for a period of one year from the date of such taking or condemnation, as evidenced by a certificate of an Independent Engineer filed with the Agency and the Trustee; or (iii) As a result of changes in the Constitution of the United States of America or of the State or of legislative or executive action of the State or any political subdivision thereof or of the United States of America or by final decree or judgment of any court after the contest thereof by the Lessee, this Agreement under becomes void or unenforceable or impossible of performance in accordance with the Company ESPP intent and purpose of the parties as expressed herein or unreasonable burdens or excessive liabilities are imposed upon the Lessee by reason of the operation of the Facility. (d) The Lessee, in terminating the Agency's leasehold interest in the Facility pursuant to Section 8.1(c) hereof, shall continuefile with the Agency and the Trustee the certificate prescribed by Section 8.1(c) (i) or (ii) hereof together with a certificate of an Authorized Representative of the Lessee stating that, as a result of the occurrence of the event giving rise to the exercise of such option to terminate the Agency's leasehold interest in the Facility, the Lessee has discontinued, or at the earliest practicable date will discontinue, the operation of the Facility for its intended purposes, and Company Shares in the case of Section 8.1(b) or 8.1(c) hereof, the Lessee shall be issued pay to participants thereunder on the next currently scheduled Trustee as the purchase dates thereunder occurring after price, in legal tender, advance rental payments, for deposit in the date hereof Bond Fund (if payment in full of the principal of or the Redemption Price, if any, as provided underthe case may be, of, and subject interest on, all the Outstanding Bonds, and the interest thereon at maturity or upon earlier redemption has not yet been made) equal to the terms and conditions ofsum of the following: (i) an amount which, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior when added to the Effective Time at an exercise price for each such offering not less than as is required under amount on deposit in the Company ESPP. Immediately prior Bond Fund and available therefor, will be sufficient to pay, retire and redeem the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to Outstanding Bonds in accordance with the provisions of the Company ESPPIndenture, including, without limitation, the principal of or the Redemption Price (as the case may be) of, together with interest to maturity or redemption date (as the case may be) on, the Outstanding Bonds; (ii) expenses of redemption, the fees and expenses of the Agency, the Trustee, the Bond Registrar and the Paying Agents and all other amounts due and payable under this Agreement and the Indenture; (iii) any amounts required to be rebated to the Federal government pursuant to the Indenture or the Tax Certificate; and (iv) one dollar. (e) Upon the payment in full of the principal of and interest on the Outstanding Bonds (whether at maturity or earlier redemption), the Lessee shall have the option to terminate the Agency's leasehold interest in the Facility and shall exercise such option by (1) delivering to the Agency prior written notice of an Authorized Representative of the Lessee no more than thirty (30) days after the payment in full of the Bonds of the exercise of such option to purchase, which notice shall set forth a requested closing date for the purchase of the Facility which shall be not later than sixty (60) days after the payment in full of the Bonds, and each participant shall receive (2) paying on such closing date a cash payment purchase price equal to the balancesum of one dollar, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As the fees and expenses of the Effective Time, each participant shall receive, by virtue of the MergerAgency, the number of whole shares of Purchaser Stock Trustee, the Bond Registrar and the Paying Agents and all other amounts due and payable under this Agreement or cash into which the shares of Company Stock such participant has so purchased under Indenture, together with any amounts required to be rebated to the Company ESPP have been converted Federal government pursuant to the Merger as provided in Section 1.3(a) hereofIndenture or the Tax Certificate. Upon the written request of the Lessee, plus the cash value Agency may approve the extension or waiver of any fraction of the time periods set forth in this paragraph. (f) The Lessee shall not, at any time, assign or transfer its option to purchase the Facility as contained in this Section 8.1 separate and apart from a share permitted assignment of Purchaser Common Stock as provided in this Agreement pursuant to Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 19.3 hereof without the prior written consent of the Agency and the Trustee.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by Witco to purchase shares of Witco Common Stock that is outstanding and unexercised option (the "Company Options") exercisable for immediately prior thereto shall cease to represent a right to acquire shares of Company Witco Common Stock and shall become fully vested be converted automatically into an option to purchase shares of Newco Common Stock in an amount and exercisable at an exercise price determined as provided below (by virtue of their terms) and Purchaser shall cause each holder of a Company Option otherwise subject to receive, by virtue the terms of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements appropriate Witco Employee Benefit Plan pursuant to which such Company Options were grantedoptions have been issued (such plans collectively the "Witco Stock Plans") except that and the exercise price and agreements evidencing grants thereunder): (i) The number of shares of Newco Common Stock to be subject to the new option shall be equal to the product of the number of shares issuable upon exercise of Witco Common Stock subject to the original option and the Exchange Ratio, provided that any fractional shares of Newco Common Stock resulting from such multiplication shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole share; and (ii) The exercise price per share of Newco Common Stock under the new option shall be equal to the exercise price per share of Witco Common Stock under the original option divided by the Exchange Ratio, provided that such exercise price shall be rounded down to the nearest whole cent or number(as so adjusted, respectively. Purchaser shall use all reasonable efforts a "Substitute Option"). (b) The adjustment provided herein with respect to ensure any options that any Company Options that qualified as are "incentive stock options under options" (as defined in Section 422 of the Internal Revenue Code Code) shall be and is intended to be effected in a manner that is consistent with Section 424(a) of 1986the Code. The duration and other terms of the new option shall be the same as the original option, as amended except that all references to Witco shall be deemed to be references to Newco. (the "Code"c) prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly Within ten (10) days after the Effective Time, Purchaser Newco shall file or cause to be filed all registration statements register under the Securities Act on Form S-8 or other appropriate form as may be necessary in connection with (and use its reasonable best efforts to maintain the purchase and sale effectiveness thereof) shares of Purchaser Newco Common Stock contemplated by such Purchaser Replacement Options subsequent issuable pursuant to all Substitute Options. (d) Effective at the Effective Time, Newco shall assume each Substitute Option in accordance with the plan or arrangement under which it was issued and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options stock option agreement by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderwhich it is evidenced. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided set forth in paragraph Section 7.2(f), each Company Stock Option that is outstanding immediately prior to the date the Offer is consummated (bthe "Offer Consummation Date") below pursuant to any Company Stock Plan shall vest and become immediately exercisable at the time of the consummation of the Offer. On the Offer Consummation Date with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options held by persons who are not subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) Act, and at the Effective Time with respect to be exempt from Company Stock Options held by persons who are subject to the application reporting requirements of Section 16(b16(a) of the Securities Exchange Act, each Company Stock Option shall be adjusted to represent an option to purchase the number of shares of Company Common Stock (a "Company Adjusted Option") (rounded down to the nearest full share) determined by multiplying (i) the number of shares of Company Common Stock subject to such Company Stock Option immediately prior to the Offer Consummation Date with respect to Company Stock Options held by persons who are not subject to the reporting requirements of Section 16(a) of the Exchange Act and immediately prior to the Effective Time with respect to Company Stock Options held by persons who are subject to the reporting requirements of Section 16(a) of the Exchange Act, by (ii) 0.5, at an exercise price per share of Company Common Stock equal to the exercise price per share of Company Common Stock immediately prior to the Offer Consummation Date. In addition, promptly following the Offer Consummation Date with respect to holders of Company Stock Options who are not subject to the reporting requirements of Section 16(a) of the Exchange Act, and promptly following the Effective Time with respect to holders of Company Stock Options who are subject to the reporting requirements of Section 16(a) of the Exchange Act, Parent shall pay to the holder of each Company Stock Option an amount of cash (rounded up to the nearest cent) equal to the product of (A) (x) $73.00 minus (y) the exercise price per share of Company Common Stock immediately prior to the Offer Consummation Date and (B) the number of shares of Company Common Stock subject to such option multiplied by 0.5 (rounded up to the nearest full share). Each Company Adjusted Option shall be exercisable upon the same terms and conditions as under the applicable Company Stock Plan and the applicable option agreement issued thereunder, except as otherwise provided in this Section 7.2. (b) At the Effective Time, each Company Adjusted Option shall be assumed by Parent and become and represent an option to purchase the number of Parent Shares (a "Parent Substitute Option") (rounded to the nearest full share, or if there shall not be a nearest share, the next greater full share) determined by multiplying (i) the number of shares of Company Common Stock subject to such Company Adjusted Option immediately prior to the Effective Time by (ii) 1.767, at an exercise price per Parent Share (rounded up to the nearest tenth of a cent) equal to (A) the exercise price per share of Company Common Stock immediately prior to the Effective Time divided by 1.767. Parent shall pay cash to holders of Parent Substitute Options in lieu of issuing fractional Parent Shares upon the exercise of Parent Substitute Options. Each Company Adjusted Option so converted shall be exercisable upon the same terms and conditions as under the applicable Company Stock Plan and the applicable option agreement issued thereunder, except as otherwise provided in this Section 7.2. Parent shall (i) on or prior to the Effective Time, reserve for issuance the number of Parent Shares that will become subject to Parent Substitute Options pursuant to this Section 7.2(b), (ii) from and after the Effective Time, upon exercise of the Parent Substitute Options in accordance with the terms thereof, make available for issuance all Parent Shares covered thereby, (iii) at the Effective Time, assume the Company Stock Plans, with the result that all obligations of the Company under the Company Stock Plans, including with respect to Company Adjusted Options outstanding at the Effective Time, shall be obligations of Parent following the Effective Time, and (iv) as promptly as practicable after the Effective Time, issue to each holder of an outstanding Company Adjusted Option a document evidencing the foregoing assumption by Parent. (c) The parties shall take all actions so that the Company Adjusted Options converted by Parent qualify following the Effective Time as incentive stock options as defined in Section 422 of the Code to the extent permitted under Section 422 of the Code and to the extent the Company Adjusted Options qualified as incentive stock options prior to the Effective Time; provided, however, that nothing in this Section 7.2(c) shall prevent the acceleration of the vesting or exercisability of any Company Stock Option, as provided in Section 7.2(a). (d) Parent shall, as promptly as practicable but in any event no later than three days after the Effective Time, file a registration statement on Form S-8 or other applicable form under the Securities Act, covering the Parent Shares issuable upon the exercise of Parent Substitute Options created upon the assumption by Parent of Company Adjusted Options under Section 7.2(b), and will maintain the effectiveness of such registration, and the current status of the prospectus contained therein, until the exercise or expiration of such Parent Substitute Options. (e) The parties will cooperate to take all reasonable steps necessary to give effect to this Section 7.2. (f) Notwithstanding the terms of Section 7.2(a), to the extent permitted thereunderan option holder holds any unexercisable incentive stock options ("Unvested ISO") on the Offer Consummation Date that do not become exercisable upon the consummation of the Offer pursuant to the terms of the Company Stock Plan(s) under which such Unvested ISOs were granted, then, to the extent possible, each such Unvested ISO shall be converted into the right to receive cash in full and the other options held by such option holder shall be appropriately adjusted such that the aggregate amount of cash payable to such option holder pursuant to Section 7.2(a) and this Section 7.2(f) does not exceed the amount that would otherwise be payable pursuant to Section 7.2(a). -34- 39 (a) Parent and the Company shall, as soon as practicable following the acceptance of Shares pursuant to the Offer, prepare and the Company shall file with the SEC the Proxy Statement and Parent and the Company shall prepare and Parent shall file with the SEC a registration statement on Form S-4 (the "Form S-4") for the offer and sale of the Parent Shares pursuant to the Merger and in which the Proxy Statement will be included as a prospectus. Each of the Company and Parent shall use all reasonable efforts to have the Form S-4 declared effective under the Securities Act as promptly as practicable after such filing. The Company will use all reasonable efforts to cause the Proxy Statement to be mailed to the Company's stockholders as promptly as practicable after the Form S-4 is declared effective under the Securities Act. Parent shall also take any action (other than qualifying to do business in any jurisdiction in which it is not now so qualified or to file a general consent to service of process) required to be taken under any applicable state securities laws in connection with the issuance of Parent Shares in the Merger and the Company shall furnish all information concerning the Company and the holders of capital stock of the Company as may be reasonably requested in connection with any such action and the preparation, filing and distribution of the Proxy Statement. No filing of, or amendment or supplement to, or correspondence to the SEC or its staff with respect to, the Form S-4 will be made by Parent, or the Proxy Statement will be made by the Company, without providing the other party a reasonable opportunity to review and comment thereon. Parent will advise the Company, promptly after it receives notice thereof, of the time when the Form S-4 has become effective or any supplement or amendment has been filed, the issuance of any stop order, the suspension of the qualification of the Parent Shares issuable in connection with the Merger for offering or sale in any jurisdiction, or any request by the SEC for amendment of the Form S-4 or comments thereon and responses thereto or requests by the SEC for additional information. The Company will advise Parent, promptly after it receives notice thereof, of any request by the SEC for the amendment of the Proxy Statement or comments thereon and responses thereto or requests by the SEC for additional information. If at any time prior to the Effective Time any information relating to the Company or Parent, or any of their respective affiliates, officers or directors, should be discovered by the Company or Parent which should be set forth in an amendment or supplement to either of the Form S-4 or the Proxy Statement, so that any of such documents would not include any misstatement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, the party which discovers such information shall promptly notify the other parties hereto and an appropriate amendment or supplement describing such information shall be promptly filed with the SEC and, to the extent required by law, disseminated to the stockholders of the Company. (b) The current offerings Company shall establish, prior to or as soon as practicable following the date upon which the Form S-4 becomes effective, a record date (which shall be prior to or as soon as practicable following the date upon which the Form S-4 becomes effective) for, duly call, give notice of, convene and hold a meeting of its stockholders (the "Company Stockholders Meeting") for the purpose of considering and taking action upon this Agreement and the Merger and (with the consent of Parent) such other matters as may in process as the reasonable judgment of the date Company be appropriate for consideration at the Company Stockholders Meeting. Once the Company Stockholders Meeting has been called and noticed, the Company shall not postpone or adjourn the Company Stockholders Meeting (other than for the absence of a quorum) without the consent of Parent. Subject to its fiduciary duties under applicable law, the Board of Directors of the Company shall include the Recommendations in the Form S-4 and the Proxy Statement as such Recommendations pertain to the Merger and this Agreement. The Company shall use its reasonable best efforts to solicit from stockholders of the Company proxies for use at the Company Stockholders Meeting and in favor of this Agreement under and the Company ESPP Merger and shall continue, and Company take all other actions reasonably necessary or advisable to secure the vote or consent of stockholders required by the DGCL to effect the Merger. (c) Parent agrees to cause all Shares shall owned by Parent or any Subsidiary of Parent to be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue voted in favor of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option to purchase a share of the Company Common Stock (an "Option" and, collectively, the "Options") outstanding and unexercised option as of the Effective Time granted pursuant to the 1985 Incentive Stock Option Plan, the 1985 Non-Qualified Stock Option Plan, the 1995 Long Term Incentive Stock Plan, any other equity-based plans or agreements of or with the Company, any of its Subsidiaries or SRH providing for the granting of options with respect to Company Common Stock (collectively, the "Company OptionsStock Option Plans") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multipliedcanceled, respectively, by the Conversion Fractionwhether or not then exercisable or vested, and rounded shall represent the right to receive the nearest whole cent or number, respectivelyfollowing consideration in settlement thereof. Purchaser shall use all reasonable efforts With respect to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986Option which is, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file vested, the Successor Corporation (or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary any trust that is adopted in connection with the purchase and sale of Purchaser any such Company Stock contemplated by such Purchaser Replacement Options subsequent Option Plan) shall pay to the Effective Timeoptionholder thereof the excess, and shall maintain the effectiveness of such registration statements (and maintain the current status if any, of the prospectus or prospectuses contained thereinMerger Consideration over such Option's exercise price (the "Option Spread") for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time. With respect to any Option which is not, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant vested, the Successor Corporation (or any trust that is adopted in connection with any such Company Stock Option Plan) shall pay to the Company ESPPoptionholder thereof the Option Spread as soon as practicable after the date when (but only if) such Option would otherwise have vested had such Option not been canceled pursuant hereto; provided, all offerings under however, with respect to any optionholder whose employment is terminated without cause by the Company ESPP shall be terminatedSuccessor Corporation or any of its Subsidiaries while such Option would have been outstanding had it not been canceled pursuant hereto, and each participant such Option shall be deemed to have purchased immediately prior to vest on the date of such termination. At the Effective Time, each option to purchase a share of the extent of payroll deductions accumulated by such participant SRH Common Stock (as defined in Section 4.2) (a "SRH Option" and, collectively, the "SRH Options") outstanding and unexercised as of such offering period end, the number of whole shares of Company Stock at a per share price determined Effective Time granted pursuant to the provisions 1989 Stock Option Plan, any other equity-based plans or agreements of or with SRH or any of its Subsidiaries providing for the granting of options with respect to SRH Common Stock (collectively, the "SRH Stock Option Plans") shall be canceled, whether or not then exercisable or vested, and shall represent the right to receive the following consideration in settlement thereof. With respect to any SRH Option which is, as of the Company ESPPEffective Time, and each participant vested, SRH (or any trust that is adopted in connection with any such SRH Stock Option Plan) shall receive a cash payment equal pay to the balanceoptionholder thereof the excess, if any, of the Merger Consideration over such accumulated payroll deductions remaining SRH Option's exercise price (the "SRH Option Spread") as soon as practicable after such purchase of such sharesthe Effective Time. As With respect to any SRH Option which is not, as of the Effective Time, each participant vested, SRH (or any trust that is adopted in connection with any such SRH Stock Option Plan) shall receivepay to the optionholder thereof the SRH Option Spread as soon as practicable after the date when (but only if) such SRH Option would otherwise have vested had such SRH Option not been canceled pursuant hereto; provided, however, with respect to any optionholder whose employment is terminated without cause by virtue SRH or any of its Subsidiaries while such SRH Option would have been outstanding had it not been canceled pursuant hereto, such SRH Option shall be deemed to vest on the date of such termination. Notwithstanding the foregoing, no optionholder shall be entitled to any payment hereunder unless he or she delivers to Parent a consent to the cancellation of the Merger, Option or SRH Option (as the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted case may be) in a form to be prescribed by Parent. All payments made pursuant to the Merger as provided in this Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 11.6 shall be reduced by all applicable withholding taxes and other similar charges.

Options. (a) Except For purposes of this Agreement, the term “Option” means each outstanding unexercised option to purchase Common Shares, whether or not then vested or fully exercisable, granted on or prior to the date hereof to any current or former employee or director of the Company or any subsidiary of the Company or any other person, whether under any stock option plan or otherwise (including, without limitation, under the Company’s Amended and Restated Stock Option Plan for Directors, Amended and Restated 1995 Stock Option Plan, 1997 European Stock Option Plan (Dutch, U.K. and French Sub-Plan Versions), 1998 Stock Option Plan, 1998 Singapore Stock Option Plan, Australian Stock Option Plan, German Stock Option Plan or Argentinean Stock Option Plan, as provided in paragraph amended) (collectively, the “Stock Plans”). (b) below The Company shall take all actions necessary so that (i) immediately prior to the Effective Time, each outstanding Option that has a per-share exercise price less than the Merger Consideration (the “Cash-Pay Options”) shall become immediately vested and exercisable in full and (ii) at the Effective Time, all Options shall be canceled, in each case, in accordance with and pursuant to the terms of the Stock Plans under which such Options were granted. In consideration of such cancellation, each holder of a Cash-Pay Option canceled in accordance with this Section 2.02(b) will be entitled to receive in settlement of such Cash-Pay Option as promptly as practicable following the Effective Time, but in no event later than 10 business days after the Effective Time, a cash payment from the Surviving Corporation, subject to any required withholding of taxes, equal to the product of (i) the total number of Common Shares otherwise issuable upon exercise of such Cash-Pay Option and (ii) the Merger Consideration per Common Share less the applicable exercise price per Common Share otherwise issuable upon exercise of such Cash-Pay Option (the “Cash-Pay Option Consideration”); provided, however, that with respect to any person subject to Section 16 of the Company's 1996 Employee Stock Purchase PlanSecurities Exchange Act of 1934, as amended (the "Company ESPP"“Exchange Act”), at any such amount shall be paid as soon as practicable after the first date payment can be made without liability to such person under Section 16(b) of the Exchange Act. The Company Board will fully accelerate the vesting schedule of the Options issued under the Stock Plans. (c) Following the Effective TimeTime and as a prerequisite to receiving their Cash-Pay Option Consideration, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of an Option whose exercise price is less than the Merger Consideration per Common Share shall be required to execute a Company Option written acknowledgment to receive, by virtue the effect that (i) the payment of the Merger Cash-Pay Option Consideration, if any, will satisfy in full the Company’s obligation to such person pursuant to such Option and (ii) subject to the payment of the Cash-Pay Option Consideration, if any, such Option held by such holder shall, without any action on the part of the Company or the holder, be deemed terminated, canceled, void and of no further force and effect as between the Company and the holder thereofand neither party shall have any further rights or obligations with respect thereto. Such written acknowledgment shall be in a form to be agreed upon by the parties hereto. (d) Between the date of this Agreement and the Effective Time, the Company shall take all necessary action to provide that the Company’s Amended and Restated Employee Stock Purchase Plan (the “ESPP”) and all options exercisable for or other rights to purchase shares of Purchaser Company Common Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") outstanding immediately prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement granted under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased terminated immediately prior to the Effective Time, to . The Company shall refund the extent of payroll deductions accumulated by such participant as of such offering period endcredited to each participant’s account under the ESPP, without interest, in accordance with the number of whole shares of Company Stock at a per share price determined pursuant to the provisions terms of the Company ESPP, and each participant shall receive a cash payment equal . (e) Prior to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant the Company shall receivetake all actions that are necessary to give effect to the transactions contemplated by this Section 2.02. (f) Except as otherwise provided herein or agreed to in writing by Merger Sub and the Company or as may be necessary to administer Options remaining outstanding following the Effective Time, by virtue the ESPP shall terminate effective as of the Mergerdate hereof and no participant in the ESPP shall thereafter be granted any rights thereunder to acquire any equity securities of the Company, the number of whole shares of Purchaser Stock Surviving Corporation, Parent or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value any subsidiary of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1the foregoing.

Options. In consideration for, and as an inducement to, agreeing to enter into this Agreement and provide the Services hereunder, the Executive shall be granted options (athe “GOLD Options”) Except as provided in paragraph (b) below with respect to purchase an aggregate of 100,000 common shares of the Company at an exercise price equal to the last closing price of the common shares of the Company on the Toronto Stock Exchange on the trading day immediately prior to the grant of the GOLD Options and vesting over a period of three years. The Company will cause BRI to grant to the Executive options (the “BRI Options”) to purchase an aggregate of 10,000 common shares of BRI, with an exercise price equal to the price per share in connection with an initial public offering or other going-public transaction of the Company (an “IPO”). For greater clarity: (i) 25% of each of the GOLD Options and the BRI Options will vest on the date of grant and 25% will vest on each of the dates that are 6, 12 and 18 months thereafter; (ii) the BRI Options will be granted as soon as reasonably practicable after completion of the IPO; (iii) the GOLD Options will be granted pursuant to, and shall at all times be subject to, the terms of the Company's 1996 Employee Stock Purchase Plan’s second amended and restated stock option plan dated April 5, 2019, as amended the same may be amended, supplemented or replaced from time to time (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms“GOLD Plan”) and Purchaser shall cause each holder the terms of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions an option agreement as may be incorporated determined by reference into the agreements evidencing Board and/or its compensation committee; (iv) the Company BRI Options will be granted pursuant to, and shall at all times be subject to, the terms of a customary long-term incentive plan to be adopted by BRI prior to its IPO (the plans or arrangements pursuant to which such Company Options were granted“BRI Plan”) except that the exercise price and the number terms of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form an applicable award agreement as may be necessary in connection with determined by the purchase board of directors and/or compensation committee of BRI; and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status v) each of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement GOLD Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement BRI Options by persons subject to the reporting requirements will be exercisable for a period of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt five years from the application of Section 16(b) of the Securities Exchange Actgrant date thereof, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms of the GOLD Plan and conditions ofBRI Plan, respectively. Notwithstanding the foregoing, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions terms of the Company ESPP, GOLD Options and each participant shall receive a cash payment equal BRI Options may be amended if required to comply with the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value requirements of any fraction of a share of Purchaser Common Stock as provided applicable stock exchange in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1connection with an IPO.

Options. (a) Except as provided in paragraph (b) below with respect For purposes of the vesting of any unvested awards previously made to Executive under the Company's 1996 Employee Stock Purchase Plan, as amended Edison International Equity Compensation Plan or under the Edison International Management and Officer Long-Term Incentive Compensation Plans (the "Company ESPPEquity Plans"), at Executive's employment by the Company shall be given the same effect as if Executive had remained regularly employed through the Effective TimeDate. Executive and the Company agree that, each then outstanding as of the Effective Date, Executive's vested options to acquire stock of the Parent and unexercised option vested phantom options in respect of the Company will be as set forth in the Schedule of Vested Options attached hereto and incorporated herein by reference (the "Company Options") exercisable ). From and after the Effective Date, the Executive shall no longer be eligible for shares grants of any awards under the Equity Plans or under any other long-term incentive plan of the Company Stock or its Affiliates, and except as set forth in Section 3.02, all unvested awards shall become fully vested and exercisable (by virtue terminate as of their terms) and Purchaser the Effective Date. On March 16, 2000, the Company shall cause each holder of a Company Option pay to receiveExecutive, by virtue wire transfer in accordance with Executive's reasonable written instructions given at least forty-eight (48) hours in advance, a gross amount, before withholding, that is equal to the difference between $471.0642 per phantom share and the pertinent exercise price of such share as shown on the Schedule of Vested Options for each vested phantom Option of the Merger Company. From and without after the date hereof, Executive shall have no further rights or entitlements in respect of such phantom Options or any action on the part phantom options in respect of the holder thereofCompany, options exercisable for shares except as set forth in Section 3.02; provided that if, within six (6) months of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as date hereof, the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing or any Affiliate of the Company Options pursuant consummates an exchange offer with holders of phantom options of the Company in which the stated exchange value (before interest and any contingent amounts) per phantom share for purposes of the exchange offer exceeds $471.0642 per phantom share, then, within thirty (30) days following the completion of such exchange offer, the Company shall pay to the plans or arrangements pursuant Executive a gross amount, before withholding, equal to which such Company Options were granted) except that the exercise price and excess multiplied by the number of shares issuable upon exercise shall be divided and multipliedvested phantom Options of Executive shown on the Schedule of Vested Options. Following the Effective Date, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive for stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary Parent listed on the part Schedule of Purchaser to enable the acquisition of Purchaser StockVested Options, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and remain subject to the terms of the award and conditions ofthe Plan under which they were granted, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant subject to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 13.02.

Options. (ai) Except If the Employee's employment is terminated following a Change of Control as provided in paragraph (b) below with respect to a result of an Involuntary Termination other than for Cause, then the unvested portion of any stock option held by the Employee under the Company's 1996 stock option plans shall automatically be accelerated as of the Termination Date and the Employee Stock Purchase Planor the Employee's representative, as amended the case may be, shall have the right to exercise all or any portion of such stock option, in addition to any portion of the option exercisable prior to such termination. If a termination of Employee's employ ment results in acceleration of vesting of any option, the Employee shall have 90 days following the Termination Date to exercise such option, notwithstanding any contrary provision of the option agreement. (ii) If a Change of Control occurs within 90 days following the "Company ESPP")termination of Employee's employment as a result of an Involuntary Termination other than for Cause, then Employee or the Employee's representative, as the case may be, shall have the right to exercise all options which were not exercisable as of the Termination Date, at the Effective Time, each then outstanding and unexercised option (same exercise price as would have applied if Employee had still been employed at the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue time of the Merger and without Change in Control. Promptly following the occurrence of any action on the part such Change of the holder thereofControl within such 90 days, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant will provide to the plans or arrangements pursuant employee written notice of such Change of Control and a written statement as to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercisable by Employee as a result of this Section 5(d)(ii) and the exercise price or prices thereof. The right to exercise such option shall be divided and multiplied, respectively, continue for 90 days following the Company's delivery of the written notice contemplated by the Conversion Fraction, and rounded to preceding sentence. In the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure event that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) such options have been converted into different securities as a result of the Securities Exchange Act (Change of Control, or have been converted into a right to receive consideration as defined below) to be exempt from the application of Section 16(b) a result of the Securities Exchange ActChange of Control, Employee shall, upon exercise of such option, be entitled to receive the extent permitted thereunder. (b) The current offerings in process same securities or consideration as of Employee would have received had the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased option been exercised immediately prior to the Effective Time, to the extent Change of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Control.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each then option granted by Subject Company to purchase shares of Subject Company Common Stock (each a "Subject Company Option") which is outstanding and unexercised immediately prior thereto shall cease to represent a right to acquire shares of Subject Company Common Stock and shall be converted automatically into an option to purchase shares of Parent Common Stock in an amount and at an exercise price determined as provided below (and otherwise subject to the terms of the Subject Company 1995 Performance Stock Plan, the Subject Company 1991 Performance Stock Plan (as amended), the Subject Company 1988 Performance Stock Plan (as amended), the Subject Company 1983 Performance Stock Plan (as amended), the Subject Company Performance Stock Plan of 1980 (as amended and restated) and the Subject Company 1991 Director Option Plan (as amended and restated), as the case may be (collectively, the "Company Options") exercisable for shares of Subject Company Stock Option Plans"), and the agreements evidencing grants thereunder, including, but not limited to, the accelerated vesting of such options which shall become fully vested occur in connection with and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part approval of the holder thereof, options exercisable for shares Merger Agreement and the Merger by the stockholders of Purchaser Stock ("Purchaser Replacement Options") having the same terms Subject Company as and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the extent required by such plans or arrangements pursuant to which such Company Options were grantedand agreements): (1) except that the exercise price and the number of shares issuable upon exercise of Parent Common Stock to be subject to the new option shall be divided equal to the product of the number of shares of Subject Company Common Stock subject to the original option and multipliedthe Common Exchange Ratio, respectively, by the Conversion Fraction, and provided that any fractional shares of Parent Common Stock resulting from such multiplication shall be rounded down to the nearest whole cent or numbershare; and (2) the exercise price per share of Parent Common Stock under the new option shall be equal to the exercise price per share of Subject Company Common Stock under the original option divided by the Common Exchange Ratio, respectivelyprovided that such exercise price shall be rounded up to the nearest cent. Purchaser shall use all reasonable efforts The adjustment provided herein with respect to ensure that any Company Options that qualified as options which are "incentive stock options under options" (as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code")) prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause be and is intended to be filed all registration statements on Form S-8 or other appropriate form as may be necessary effected in connection a manner which is consistent with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a424(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange ActCode and, to the extent permitted thereunder. (bit is not so consistent, such Section 424(a) shall override anything to the contrary contained herein. The current offerings in process as duration and other terms of the date of this Agreement under the Company ESPP shall continue, and Company Shares new option shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after same as the date hereof as provided under, and original option (subject to the terms and conditions of, the Section 6.7(b) hereof) except that all references to Subject Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior be references to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Parent.

Options. (a) Except as provided in paragraph may otherwise be agreed upon between a holder of Company Stock Options and Parent, each option granted to a Company employee to acquire shares of Company Common Stock (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPPStock Option"), at ) that is outstanding immediately prior to the Effective Time, each whether or not then outstanding vested or exercisable, shall, effective as of the Effective Time, become and unexercised represent an option to acquire the number of shares of Parent Common Stock (a "Substitute Option"), rounded up or down to the "Company Options"nearest whole share, determined by multiplying (i) exercisable for the number of shares of Company Common Stock shall become fully vested and exercisable subject to such Company Stock Option immediately prior to the Effective Time by (ii) the Exchange Ratio, at an exercise price per share of Parent Common Stock (increased to the nearest whole cent) equal to the exercise price per share of such Company Stock Option divided by virtue the Exchange Ratio; provided, however, that in the case of their terms) and Purchaser shall cause each holder of a any Company Stock Option to receive, by virtue which Section 421 of the Merger and without any action on the part Code applies by reason of its qualification as an incentive stock option under Section 422 of the holder thereofCode, options the conversion formula shall be adjusted if necessary to comply with Section 424(a) of the Code; and provided, further, that the conversion formula shall be further adjusted as provided in Section 2.3(d). After the Effective Time, except as provided in this Section 2.3, each Substitute Option shall be exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having upon the same terms and conditions as were applicable to the related Company Stock Option immediately prior to the Effective Time. (b) Prior to the Effective Time, the Company shall (i) obtain any consents from holders of Company Stock Options and (including such ii) amend the terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant of its equity incentive plans or arrangements, in each case to the plans extent, if any, necessary to give effect to the provisions of Section 2.3(a). (c) As soon as reasonably practicable after the Effective Time, Parent shall (i) file with the Securities and Exchange Commission (the "SEC") a registration statement on Form S-8 or arrangements pursuant another appropriate form with respect to which the shares of Parent Common Stock subject to such Company Options were grantedoptions, (ii) except that as soon as reasonably practicable, prepare and file with the Nasdaq listing applications covering the shares of Parent Common Stock issuable upon the exercise price of Substitute Options and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as obtain approval for the listing of such shares of Parent Common Stock, subject only to official notice of issuance and (iii) amend the terms of its equity incentive stock options under Section 422 of the Internal Revenue Code of 1986plans or arrangements, as amended (the "Code") prior in each case to the Effective Time continue extent, if any, necessary to so qualify after give effect to the Effective Timeprovisions of Section 2.3(a). Purchaser Parent shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Parent Common Stock for delivery upon the exercise of Purchaser Replacement Options after Substitute Options. (d) In the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary event that any Franchise Amount becomes due in connection accordance with the purchase provisions of Section 2.6, the conversion formula applicable to each Substitute Option shall be adjusted by recalculating such formula in accordance with clauses (i) and sale (ii) of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to Section 2.3(a) as if the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after Exchange Ratio had been determined at the Effective Time pursuant to Purchaser Replacement Options by persons subject to include the reporting requirements of Section 16(a) value of the Securities Exchange Act (as defined below) to be exempt from the application of Franchise Amount that is actually due in accordance with Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder2.6. (be) The current offerings in process as On any date on which either (i) a Contingent Deferred Payment is paid or (ii) the Escrow Agent releases any portion of the date Escrow Account (as it may be increased) to Parent in respect of this Agreement under any Indemnified Losses, the Company ESPP shall continue, and Company Shares conversion formula applicable to each Substitute Option shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date adjusted by recalculating such formula in accordance with clauses (i) and (ii) of Section 2.3(a) hereof as provided under, and subject to if the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to Exchange Ratio had been determined at the Effective Time at an exercise price for each such offering not less than as is required under to include the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction Contingent Deferred Payment that is actually paid in accordance with Section 2.5 and to exclude the value of a share any portion of Purchaser Common Stock as provided the Escrow Account that is released to Parent in Section 1.5(h) hereof, plus respect of any dividends or distributions as provided in Section 1Indemnified Losses.

Options. Subject to the following and the provisions of section "4.6" hereinbelow, it is hereby acknowledged and agreed that the Executive will be granted, or will have already been granted, subject to the rules and policies of the Regulatory Authorities and applicable securities legislation, the terms and conditions of the Company's existing stock incentive plans (acollectively, the "Option Plan") Except as provided in paragraph and the final determination of the Board of Directors, acting reasonably, an incentive stock option or options (beach being an "Option") below for the collective purchase of up to an aggregate of not less than 217,500 common shares of the Company (each an "Option Share"); at an exercise price of U.S. $1.50 per Option Share with respect to not less than 75,000 of the Option Shares, at an exercise price of U.S. $2.40 per Option Share with respect to not less than a further 75,000 of the Option Shares and at an exercise price of U.S. $2.43 per Option Share with respect to the Company's 1996 Employee Stock Purchase Planbalance of the Option Shares; and exercisable for a period of not less than ten years from the date of grant in each instance; and such further number of Options to acquire an equivalent number of Option Shares of the Company as the Board of Directors may determine, in its sole and absolute discretion; and which Option or Options will be exercisable for such periods and at such exercise price or prices per Option Share as amended (the "Company ESPP")Board of Directors may also determine, at in its sole and absolute discretion, from time to time after the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except Date hereof. It is hereby acknowledged that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company initial Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") granted prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date Date of this Agreement under were negotiated as between the Parties hereto in the context of the stage of development of the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and existing prior to the Effective Time at an exercise price for each such offering not less than as Date of this Agreement. Correspondingly, it is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, hereby acknowledged and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, agreed that the number of whole shares of Options granted by the Company Stock at a per share price determined pursuant to the provisions Executive hereunder shall be reviewed and renegotiated at the request of either Party on a reasonably consistent basis during the Company ESPPcontinuance of this Agreement and, and each participant shall receive a cash payment equal to in the balanceevent that the Parties cannot agree, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, then the number of whole shares Options shall be increased on an annual basis one year after the Effective Date by the percentage which is the average percentage of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under all increases to management stock options within the Company ESPP have been converted pursuant to during the Merger as provided previous 12-month period; and in Section 1.3(a) hereof, plus each case on similar and reasonable exercise terms and conditions. Any dispute respecting either the cash value effectiveness or magnitude of any fraction of a share of Purchaser Common Stock as provided the final number and terms hereunder shall be determined by arbitration in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1accordance with Article "9" hereinbelow.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent Company has entered into letter agreements with each of payroll deductions accumulated by such participant as the holders (the “Option Holders”) of such offering period end, outstanding options of the number of whole shares of Company Stock at a per share price determined (the “Options”) granted pursuant to the provisions Pre-Amendment Option Plan (the Options granted pursuant to the Pre-Amendment Option Plan, the “Pre-Amendment Plan Options”) in the form attached hereto as Exhibit K (the “Option Letter Agreements”), pursuant to which each Pre-Amendment Plan Option (i) that would not otherwise be vested and exercisable immediately prior to the Effective Time will become fully vested and exercisable immediately prior to the Effective Time and (ii) will be converted at the Effective Time solely into the right to receive a portion of the Company ESPPMerger Consideration as set forth below. By virtue of the foregoing, the Pre-Amendment Plan Options held by each Option Holder shall be converted at the Closing into the right to receive cash in the amount set forth opposite such Option Holder’s name on Annex F (the “Pre-Amendment Plan Option Payments”) (it being acknowledged that, as set forth in the Option Letter Agreements, (i) no portion of any such Pre-Amendment Plan Option Payment will be included in the Escrowed Cash, and each participant shall (ii) the Option Holders will not be entitled to receive a cash payment equal any portion of any Final Adjustment Amount payable by the Emdeon Entities pursuant to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Section 2.3 hereof). (b) Effective immediately prior to Effective Time, each participant shall receivethe Board of Managers has approved a resolution providing that all Options granted pursuant to the Current Option Plan (the Options granted pursuant to the Current Option Plan, by the “Current Plan Options”) will be settled and cancelled solely in exchange for the right to receive a portion of the Merger Consideration as set forth below. By virtue of the Mergerforegoing, the number Current Plan Options held by each Option Holder shall be converted at the Closing into the right to receive cash in the amount set forth opposite such Option Holder’s name on Annex F (the “Current Plan Option Payment”; together with the Pre-Amendment Plan Option Payments, the “Option Payments”) (it being acknowledged that (i) no portion of whole shares the Current Plan Option Payments will be included in the Escrowed Cash, and (ii) the Option Holders will not be entitled to receive any portion of Purchaser Stock any Final Adjustment Amount payable by the Emdeon Entities pursuant to Section 2.3 hereof). Immediately following the Closing, the Surviving Entity and the Members’ Representative will cooperate to deliver to each of the holders of the Current Plan Options (a) the letter in the form of Exhibit L attached hereto notifying such holders of the settlement and cancellation of such Current Plan Options in accordance with this Section 2.6(b), and (b) along with the letter, the Current Plan Option Payment payable by the Members’ Representative to such holder pursuant to Section 2.6(c) below. (c) The Option Payments will comprise a portion of the Base Cash Consideration payable by the Emdeon Entities by wire transfer of immediately available funds at Closing to the Members’ Representative (and the Members’ Representative will distribute such Option Payments to the Option Holders in accordance with Annex F); provided, however, that (i) the Option Payments otherwise payable by the Emdeon Entities to the Members’ Representative shall be subject to reduction for the amount of federal, state or cash into which other Taxes that the shares of Company Stock such participant has so purchased under Emdeon Entities, the Company ESPP have been converted pursuant or the Surviving Entity are required to withhold with respect to such payments as reflected in the Merger as provided Funds Flow Statement, and (ii) the Members’ Representative will distribute the Option Payments in respect of the Current Plan Options in accordance with the last sentence of Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 12.6(b).

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, each all employee and director stock options to purchase shares of USBC Common Stock (each, a "USBC Stock Option"), which are then outstanding and unexercised option (the "Company Options") exercisable for unexercised, shall cease to represent a right to acquire shares of Company USBC Common Stock and shall become fully vested be converted automatically into options to purchase shares of FBS Common Stock, and exercisable (by virtue FBS shall assume each such USBC Stock Option subject to the terms thereof, including but not limited to the accelerated vesting of their terms) such options which shall occur in connection with and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger as and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the extent required by the plans or arrangements pursuant to which and agreements governing such Company Options were grantedUSBC Stock Options; provided, however, that from and after the Effective Time, (i) except that the exercise price and the number of shares issuable of FBS Common Stock purchasable upon exercise of such USBC Stock Option shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded equal to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure number of shares of USBC Common Stock that any Company Options that qualified as incentive stock options were purchasable under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") such USBC Stock Option immediately prior to the Effective Time continue multiplied by the Exchange Ratio, and rounding to so qualify after the Effective Timenearest whole share, and (ii) the per share exercise price under each such USBC Stock Option shall be adjusted by dividing the per share exercise price of each such USBC Stock Option by the Exchange Ratio, and rounding down to the nearest cent. Purchaser shall take all corporate action necessary The terms of each USBC Stock Option shall, in accordance with its terms, be subject to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Timefurther adjustment as appropriate to reflect any stock split, Purchaser shall file or cause to be filed all registration statements on Form S-8 stock dividend, recapitalization or other appropriate form as may be necessary in connection similar transaction with the purchase and sale of Purchaser respect to FBS Common Stock contemplated by such Purchaser Replacement Options on or subsequent to the Effective TimeDate. Notwithstanding the foregoing, and shall maintain the effectiveness of such registration statements each USBC Stock Option which is intended to be an "incentive stock option" (and maintain the current status as defined in Section 422 of the prospectus or prospectuses contained thereinCode) for so long as any of shall be adjusted in accordance with the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) 424 of the Securities Exchange Act (as defined below) Code. Accordingly, with respect to any incentive stock options, fractional shares shall be exempt from the application of Section 16(b) of the Securities Exchange Act, rounded down to the extent permitted thereunder. (b) The current offerings in process as nearest whole number of shares and where necessary the date of this Agreement under the Company ESPP shall continue, and Company Shares per share exercise price shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject rounded down to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1nearest cent.

Options. (a) Except as provided in paragraph (b) below with respect Prior to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective Time, the Company Board (or, if appropriate, any committee thereof) shall take any actions necessary, including adopting appropriate resolutions, to provide that, concurrent with the Effective Time: (a) each then outstanding outstanding, unexpired and unexercised option to purchase Company Common Stock (the "“Company Options"”) exercisable for shares granted under the stock plans of the Company or under any individual consultant, employee or director agreement (the “Company Stock Plans”), whether or not then exercisable, conditioned or vested, shall become fully vested vest and exercisable (by virtue of their terms) be deemed to be exercised and Purchaser shall cause cancelled and each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to receive at the Effective Time continue to so qualify (or as soon as practicable thereafter, but in any event no later than three Business Days after the Effective Time. Purchaser shall take all corporate action necessary Closing Date), in consideration of the deemed exercise and cancellation of such Company Option, a payment by the Surviving Corporation (or, at Parent’s option, Parent) in cash (subject to reserve for issuance a sufficient any applicable withholding or other Taxes required to be withheld by applicable Law), without interest, in an amount equal to the product of (x) the total number of shares of Purchaser Company Common Stock for delivery upon subject to such Company Option (assuming such Company Option is fully vested and currently exercisable) and (y) the excess, if any, of the Merger Consideration over the exercise price per share of Purchaser Replacement Company Common Stock subject to such Company Option (such amounts payable hereunder being referred to as the “Option Payments”) and (b) each right of any kind, contingent or accrued, to receive shares of Company Common Stock or benefits measured by the value of a number of shares of Company Common Stock, and each award of any kind consisting of shares of Company Common Stock, granted under Company Stock Plans (including restricted stock, restricted stock units, deferred stock and performance awards), other than Company Options (each, a “Company Stock-Based Award”), whether or not then vested, shall vest on the terms set forth in the applicable Company Stock Plan and related agreements (or, if such Company-Stock Based Awards would not otherwise vest, the Company Board shall cause such Company-Stock Based Awards to vest in accordance with the applicable Company Stock Plan), and shall be cancelled and each beneficiary of a Company Stock-Based Award providing for such beneficiary to receive shares of Company Common Stock shall, in lieu thereof, be entitled to, and shall be paid pursuant to Section 3.2, the Merger Consideration payable pursuant to Section 3.1.1 in respect of such shares of Company Common Stock; provided, however, that the balance of any performance shares granted in 2006 and listed on Appendix A of the Company Disclosure Schedule which have not yet vested at the date of the Closing after giving effect to the Effective Timepro-ration language set forth in the 2006 Performance Share Award Agreement for such grants shall not vest and shall be canceled. Promptly At and after the Effective Time, Purchaser each Company Option and each Company Stock-Based Award shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, cancelled and shall maintain only entitle the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long holder thereof to payment as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions described in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of this Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder3.5. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (a) Except as provided in paragraph (b) below with respect Subject to the Company's 1996 Employee Stock Purchase Planreceipt of all necessary approvals of Regulatory Authorities, as amended (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including shall notify the Optionholders as required under the Option Plan and take all such terms and conditions steps as may be incorporated necessary or desirable to amend the Option Plan to: (i) permit all Optionholders to exercise all of their Options on an accelerated basis, whether or not exercisable or vested in accordance with their terms; (ii) permit all Optionholders to exercise all of their Options on a “cashless” basis by reference into the agreements evidencing allowing an Optionholder to surrender his or her Options to the Company Options pursuant to for cancellation, conditional upon the plans or arrangements pursuant to which such Offeror taking up Company Options were granted) except that Shares under the exercise price and the number of shares issuable upon exercise shall be divided and multipliedOffer, respectively, in exchange for a payment by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery per Company Share issuable upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent Option equal to the Effective Time, and shall maintain amount by which $2.80 exceeds the effectiveness exercise price of such registration statements Option payable in Company Shares at a value per Company Share of $2.80; and (and maintain iii) terminate the current status of Option Plan at the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Expiry Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as Offeror shall make tendering arrangements under the Offer to facilitate the conditional surrender of the date Options contemplated by Section 2.4(a)(ii) and the tender of this Agreement the Company Shares to be issued as a result of such conditional surrender (including providing for the ability of Optionholders to tender their Options or to tender Company Shares on the basis of guaranteed deliveries). All Company Shares that are to be issued pursuant to any such conditional surrender shall be accepted as validly tendered under the Company ESPP shall continue, Offer and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant surrender shall be deemed to have purchased occurred immediately prior to the Effective Timetake-up of Company Shares, to provided that the extent of payroll deductions accumulated by such participant as holders of such offering period end, Options indicate that the number of whole shares of Company Stock at a per share price determined Shares so conditionally issued are tendered pursuant to the provisions Offer and otherwise validly accept the Offer in accordance with its terms with respect to such Company Shares. The Company shall use its commercially reasonable efforts to cause all outstanding Options to be exercised or surrendered prior to the Expiry Time. (c) The Company shall withhold and remit to the relevant Regulatory Authority any amounts required or permitted in connection with the exercise, surrender or cancellation of the Options and the Company ESPPshall take all reasonable steps to ensure that such withholding and remittance is made, and each participant shall receive including obtaining a cash payment equal written direction from the Optionholder to pay a portion of the proceeds under the Offer to the balance, if any, Company (or cause the sale of such accumulated payroll deductions remaining after such purchase of such shares. As of any Offeror Shares received by the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased Optionholder under the Company ESPP have been converted pursuant Offer) to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1satisfy its withholding and remittance obligations.

Options. (a) Except as provided in paragraph (b) below with respect Prior to the Company's 1996 Employee Stock Purchase PlanEffective Time, as amended the Board of Directors of the Company (the "Company ESPPBoard")) (or, if appropriate, any committee thereof) and the Board of Directors of Parent (the "Parent Board") (or, if appropriate, any committee thereof) shall adopt appropriate resolutions and take all other actions necessary to provide that effective at the Effective Time, each then outstanding Company Option, whether vested or unvested, shall be assumed by Parent and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action continue in effect on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant in effect immediately prior to the plans or arrangements pursuant Effective Time (subject to which the adjustments in this Section 2.12) and each such Company Options were grantedOption shall be converted automatically into an option (a "New Option") except that the exercise price and to purchase the number of shares issuable upon of Parent Stock, determined as provided below, at the exercise price, determined as provided below: (i) The number of shares of Parent Stock to be subject to the New Option shall be divided and multipliedequal to the product of (x) the number of shares of Company Stock remaining subject (as of immediately prior to the Effective Time) to the Company Option multiplied by (y) the Common Exchange Ratio, respectively, by provided that the Conversion Fraction, and number of shares of Parent Stock resulting therefrom shall be rounded to the nearest whole cent or numbershare of Parent Stock. (ii) The exercise price per share of Parent Stock under the New Option shall be equal to (x) the exercise price per share of the Company Stock under the Company Option, respectivelydivided by (y) the Common Exchange Ratio, provided that such exercise price shall be rounded to the nearest whole cent. Purchaser shall use all reasonable efforts The adjustment provided herein with respect to ensure that any Company Options that qualified as Option which is an "incentive stock options under option" (as defined in Section 422 of the Internal Revenue Code Code) shall be, and is intended to be, effected in a manner which is consistent with Section 424(a) of 1986the Code. Except as provided in this Section 2.12, after the Effective Time, each New Option shall be exercisable upon the same terms and conditions as amended (were applicable to the "Code") related Company Option immediately prior to the Effective Time continue (except that with regard to so qualify after such New Option, any references to the Effective TimeCompany shall be deemed, as appropriate, to mean Parent). Purchaser Parent shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Timenecessary, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the authorize and reserve a number of whole shares of Company Parent Stock at a per share price determined pursuant to sufficient for issuance upon the provisions exercise of the Company ESPP, and each participant New Options as contemplated by this Section 2.12. (b) Parent shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining file promptly after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue a registration statement on Form S-8 (or any successor or other appropriate form) registering a number of shares of Parent Stock to be issued in connection with the exercise of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger New Options as provided determined in this Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 12.12.

Options. (a) Except as provided in paragraph (b) below with respect Immediately prior to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at the Effective TimeDate, each then then-outstanding and unexercised option to purchase Company Shares (the "Company Options"each, an “Option”) exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue granted under any director or employee stock option or compensation plan or arrangement of the Merger Company (collectively, the “Company Share Plans”) prior to calendar year 2021, whether or not vested, shall, automatically and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having be cancelled and converted into the same terms right to receive, and conditions as the Company Options (including shall pay to each former holder of any such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant Option an amount in cash equal to the plans or arrangements pursuant to which such Company Options were grantedproduct of (i) except that the excess, if any, of the Consideration over the applicable exercise price per Company Share of such Option and (ii) the number of shares issuable upon exercise shall be divided and multipliedCompany Shares subject to such Option, respectively, by payable (without any crediting of interest for the Conversion Fraction, and rounded to period from the nearest whole cent or number, respectivelyEffective Date through the date of payment) as soon as reasonably practicable (but no later than the first payroll date) after the Effective Date. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") Each Option outstanding immediately prior to the Effective Time continue to so qualify after Date that was granted in calendar year 2021 (the Effective Time. Purchaser shall take all corporate “2021 Option”) shall, automatically and without any action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser the holder thereof, be cancelled and converted into the right to enable receive an amount in cash (the acquisition “Option Cash Out Award”) equal to the product of Purchaser Stock(i) the excess, Purchaser Replacement Options if any, of the Consideration over the applicable exercise price per Company Share of such 2021 Option and subsequent transactions in Purchaser Stock after (ii) the number of Company Shares subject to such 2021 Option, payable (without any crediting of interest for the period from the Effective Time Date through the date of payment) as soon as reasonably practicable (but no later than the first payroll date) after each date that such 2021 Option would have otherwise vested and become exercisable in accordance with its terms but only if such conditions to vesting are satisfied prior to each such vesting date; provided, that if the employment or service of the grantee of such Option Cash Out Award is terminated prior to any vesting date by BidCo or one of its Affiliates without Cause or as a result of death or Disability (each as defined in the award agreement pursuant to Purchaser Replacement Options by persons subject to which the reporting requirements of Section 16(a) of 2021 Option was granted, which definitions shall be the Securities Exchange Act (same as defined below) to be exempt from the application of Section 16(b) of definitions in the Securities Exchange ActOption award agreements evidencing the grants made in calendar year 2020), to then the extent permitted thereunder. (b) The current offerings in process Option Cash Out Award shall fully vest as of the date of this Agreement under such termination of employment or service and be paid within thirty days following such termination. For the avoidance of doubt, any Option which has a per Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an Share exercise price for each such offering not less that is greater than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment or equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of Consideration shall be cancelled on the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock Date for no consideration or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1payment.

Options. (a) Except as provided in paragraph At the Effective Date, each outstanding and unexercised Company stock option (bwhether vested or unvested) below with respect to outstanding under The Compucare Company 1997 Stock Compensation Plan and the Company's 1996 Health Systems Integration, Inc. 1986 Employee Stock Purchase Plan, as amended Option Plan (the "Company ESPP"), at the Effective Time, each then outstanding and unexercised option (the "Company OptionsOption Plans") exercisable for and each outstanding warrant or similar right to purchase Company Common Stock shall cease to represent a right to acquire shares of Company Common Stock , as set forth on Schedule 2.4(a), as the case may be, and shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option be converted automatically into an option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for purchase shares of Purchaser QuadraMed Common Stock ("Purchaser Replacement Options") having the same terms in an amount and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the at an exercise price and determined as provided below. Schedule 2.4(a) sets forth the number of shares issuable upon exercise shall be divided and multipliedfor which each option, respectively, by the Conversion Fraction, and rounded warrant or similar right (other than those issued pursuant to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 Option Plans) is exerciseable and the per share exercise price of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify both before and after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock merger transaction contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunderthis agreement. (b) The current offerings number of shares of QuadraMed Common Stock subject to the new option, warrant or similar right shall be equal to the product of the number of shares of Company Common Stock (on an as converted basis) subject to the original option, warrant or similar right multiplied by the Conversion Ratio, provided that any fractional shares of QuadraMed Common Stock resulting from such multiplication shall be rounded to the nearest share. (c) The exercise price per share of QuadraMed Common Stock under the new option, warrant or similar right shall be equal to the quotient obtained by dividing the exercise price per share of Company Common Stock (on an as converted basis) under the original option , warrant or similar right by the Conversion Ratio, provided that such exercise price shall be rounded down to the nearest cent. (d) The adjustment provided herein with respect to any options that are "incentive stock options" (as defined in process Section 422 of the Code) shall be and are intended to be effected in a manner consistent with Section 424(a) of the Code. The duration and other terms of the new option shall be the same as the original option except that all references to the Company shall be deemed to be references to QuadraMed. (e) Each Company stock option shall be assumed by QuadraMed in accordance with the terms (as in effect as of the date of this Agreement under Agreement) of the Option Plans and the stock option agreement by which such Company ESPP stock option is evidenced. QuadraMed shall continuebecome the plan administrator of the Option Plans. All restrictions on the exercise of each such assumed Company stock option shall continue in full force and effect, and the term, exercisability, vesting schedule (if any) and other provisions of such Company Shares stock option shall be issued to participants thereunder on otherwise remain unchanged except as expressly provided in the next currently scheduled purchase dates thereunder occurring after Option Plans and/or the date hereof as provided under, and subject to applicable stock option agreements. QuadraMed acknowledges that all of the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, stock options outstanding pursuant to the Company ESPP, all offerings under the Company ESPP shall Option Plans will be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1fully vested except those set forth on Schedule 2.4(e).

Options. (a) Except as provided Spinners hereby covenants and agrees that at the Effective Time, all of the Spinners Stock Rights (all of which are set forth on Schedule 4.3(a) -------------- hereto) shall have been properly canceled and, except for the right to receive options to acquire Parent Stock described in paragraph Section 6.6(b) below, all rights and obligations thereunder shall have been terminated. (b) below with respect Parent hereby covenants and agrees that, at the Effective Time, each of the holders of Spinners Stock Rights shall receive incentive or non- qualified options (corresponding to whether their previous Spinners Options were incentive or non-qualified) to purchase the number of shares of validly issued, fully paid and nonassessable Parent Stock, at the exercise price per share, as set forth on Schedule 6.6(b) hereto, all of which -------------- options shall have been issued pursuant to the Company's IXL Holdings, Inc. 1996 Employee Stock Purchase Option Plan, as amended (the "Company ESPPParent Stock Option Plan"). (c) Parent further covenants that, at the Effective Time, each then outstanding and unexercised option (the "Company Options") exercisable for it will issue options to purchase up to 250,000 shares of Company Stock validly issued, fully paid and nonassessable Parent Stock, at an exercise price of $10 per share and vesting 20% per year over each of five years, to those Persons designated by Spinners, approved by Parent and listed on Schedule 6.6(c) hereto, all of which options -------------- shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options issued pursuant to the plans Parent Stock Option Plan; provided, however, that if for any reason any such options shall not fully vest in accordance with the terms of the award thereof, or arrangements pursuant to which such Company Options were granted) except are not exercised within the time period provided therein, and therefore expire or are canceled, then in that the exercise price and event non- qualified options on the number of shares issuable upon exercise of Parent Stock subject to such expired or canceled option, and corresponding as to price and vesting, shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded issued to the nearest whole cent or numberSpinners Shareholders without the payment of any additional consideration therefor, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of pro rata in accordance with the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Parent Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary received in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. Each CWS Stock Option (aas herein defined) Except to purchase CWS Common Shares as provided set forth in paragraph Schedule 2.3(b) of the CWS Disclosure Letter (bas defined herein) below with respect that is outstanding immediately prior to the Company's 1996 Employee REIT Merger Effective Time and that is held by a former employee of CWS, any CWS Subsidiary or their Affiliates or by any person whose employment with CWS, any CWS Subsidiary or their Affiliates is terminated as of the REIT Merger Effective Time shall be satisfied and cancelled at the REIT Merger Effective Time and, in the case of each such satisfied and cancelled CWS Stock Purchase PlanOption, each holder thereof shall be entitled to receive (subject to any withholding required by law), as amended soon as practicable but in no event later than five business days following the REIT Merger Effective Time, an amount, if any, equal to (i) the "Company ESPP")Cash Amount Per Share, at minus (ii) the exercise price of the CWS Stock Option, multiplied by (iii) the number of CWS Common Shares subject to the CWS Stock Option. Notwithstanding the foregoing, if the exercise price of any CWS Stock Option exceeds the Cash Amount Per Share, no cash shall be paid with regard to such CWS Stock Option to the holder of such CWS Stock Option and any such CWS Stock Options shall automatically be canceled. As of the REIT Merger Effective Time, each then CWS Stock Option to purchase CWS Common Shares as set forth in Schedule 2.3(b) of the CWS Disclosure Letter that is outstanding immediately prior to the REIT Merger Effective Time and unexercised that is not described in the preceding sentence, whether vested or unvested, shall be converted to an option (the a "Company OptionsSubstituted Option") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receiveacquire, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including were applicable under such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant CWS Stock Option, that number of shares of CHATEAU Common Stock equal to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, CWS Common Shares subject to the CWS Stock Option immediately prior to the REIT Merger Effective Time multiplied by the Conversion Fraction, and Exchange Ratio (rounded down to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required per share (rounded up to the nearest cent) equal to the exercise price per share under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased CWS Stock Option immediately prior to the REIT Merger Effective Time, to Time divided by the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Exchange Ratio.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At and after the Effective Time, each then option granted by FDB and BIF to purchase shares of FDB Common Stock and BIF Common Stock, respectively, which is outstanding and unexercised immediately prior thereto shall cease to represent a right to acquire shares of either FDB Common Stock or BIF Common Stock and shall be converted automatically into an option to purchase shares of Newco Common Stock (the "Company FDB Converted Stock Options" and the "BIF Converted Stock Options," respectively) exercisable for shares in an amount and at an exercise price determined as provided below and otherwise subject to the terms of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant grants of such options: (i) The number of shares of Newco Common Stock to be subject to each FDB Converted Stock Option shall be equal to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and product of the number of shares issuable upon exercise of FDB Common Stock subject to the original option and the FDB Exchange Ratio, provided that any fractional shares of Newco Common Stock shall be rounded up to the next highest whole share; and (ii) The exercise price per share of Newco Common Stock under the FDB Converted Stock Option shall be equal to the exercise price per share of FDB Common Stock under the original option divided and multiplied, respectively, by the Conversion FractionFDB Exchange Ratio, and provided that such exercise price shall be rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended cent. (the "Code"iii) prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient The number of shares of Purchaser Newco Common Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may subject to each BIF Converted Stock Option shall be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent equal to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status product of the prospectus or prospectuses contained therein) for so long as any number of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser BIF Common Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements original option and the BIF Exchange Ratio, provided that any fractional shares of Section 16(a) of the Securities Exchange Act (as defined below) to Newco Common Stock shall be exempt from the application of Section 16(b) of the Securities Exchange Act, rounded up to the extent permitted thereundernext highest whole share; and (iv) The exercise price per share of Newco Common Stock under the BIF Converted Stock Option shall be equal to the exercise price per share of BIF Common Stock under the original option divided by the BIF Exchange Ratio, provided that such exercise price shall be rounded to the nearest whole cent. (b) The current offerings adjustment provided herein with respect to any options which are "incentive stock options" (as defined in process as Section 422 of the date of this Agreement under the Company ESPP shall continueCode), and Company Shares shall be issued and is intended to participants thereunder on be effected in a manner which is consistent with Section 424(a) of the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPPCode. The Company may, consistent with past practice, commence new offering periods under duration and other terms of the Company ESPP on or after the date hereof FDB Converted Stock Options and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP BIF Converted Stock Options shall be terminatedthe same as he original option except that all references to FDB or BIF, and each participant as the case may be, shall be deemed to have purchased immediately prior be references to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1Newco.

Options. Upon the execution hereof, Employee shall receive three hundred twelve thousand five hundred (a312,500) Except as provided in paragraph (b) below with respect options to purchase the Company's 1996 Employee Stock Purchase Plan, as amended common stock of Employer (the "Company ESPPOption Shares"). The exercise price of such options shall be equal to the mean between the bid and asked prices for Employer's common stock, at as reported by NASDAQ System as of the Effective Time, each then outstanding and unexercised option (close of business on the "Company Options") exercisable for shares date of Company Stock this Agreement. The options shall become be fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise grant. The option shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve valid for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process term commencing as of the date of this Agreement and ending ten (10) years thereafter. The options shall be non-transferable (other than by will or otherwise upon death). During Employee's lifetime, the options may be exercised only by the Employee. (i) At any time after the first anniversary of the Effective Date, Employee may, by written notice (the "Registration Notice") to the Company request that the Company register for sale under the Company ESPP Securities Act of 1933, as amended (the "Securities Act"), all or any portion of the Option Shares that Employee has purchased, or will purchase, on or before the effective of the registration statement relating to the disposition of the Option Shares. As soon as practicable following receipt of the Registration Notice, Employer (i) shall continue, commence to prepare and Company shall file a registration statement under the Securities Act for the sale of the Option Shares shall be issued specified in such Registration Notice and (ii) use its best efforts to participants thereunder on cause such registration statement to become effective for the next currently scheduled purchase dates thereunder occurring after lesser of (y) one year and (z) the date hereof as provided underupon which all of the Option Shares which are the subject of such registration statement have been disposed of. The registration statement contemplated by this clause (d) shall provide for the sale by Employee of the Option Shares included therein from time to time on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, and subject but shall not provide for the distribution of the Option Shares pursuant to an underwritten distribution. (ii) Notwithstanding anything to the terms and conditions ofcontrary contained in this Agreement, the Company ESPP. The Company mayEmployer shall not be required to file a registration statement or cause it to be declared effective at a time (x) after completion of a fiscal year end, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and but prior to the Effective Time at an exercise price availability of the year end audited financial statements, (y) when Employer, in the good faith judgement of its board of directors shall determine that any offering of Option Shares would impede, delay or otherwise interfere with any pending or contemplated acquisition involving Employer or (z) when Employer is in possession of material information which, in the good faith judgment of Employer's board of directors, if disclosed in a registration statement, would be materially harmful to the interests of Employer and its shareholders. Employee shall cease all disposition efforts with respect to Option Shares upon receipt of notice from Employer indicating the existence of any circumstance of any of the events described in this clause (ii). (iii) Employer shall not be required to register the Option Shares pursuant to this clause (d) on more than one occasion. (iv) It shall be a condition to the inclusion of any Option Shares in a registration statement that Employee cooperate in the execution and filing of the registration statement and any necessary state securities law filings. (v) Whether or not any registration statement becomes effective, Employer shall pay all costs, fees and expenses incident to Employer's performance of or compliance with this clause (d). Notwithstanding the foregoing, any discounts, commissions, brokers' fees or fees of similar securities industry professional relating to the distribution of the Option Shares and fees and expenses of counsel for each such offering not less than as is required under Employee will be payable by Employee and the Company ESPP. Immediately prior will have no obligation to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by pay any such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1amounts.

Options. (a) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at At the Effective Time, the Company Stock Plans (as defined herein), and each then outstanding and unexercised option (the "Company Options") exercisable for to purchase shares of Company Capital Stock, whether granted pursuant to a Company Stock shall become fully Plan or otherwise, whether vested and exercisable or unvested (by virtue of their terms"COMPANY OPTION") and Purchaser shall cause each holder outstanding grant of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for restricted shares of Purchaser Company Common Stock ("Purchaser Replacement OptionsRESTRICTED STOCK") having (all such Company Options and Restricted Stock being set forth on SCHEDULE 3.2 and SCHEDULE 3.31) will be assumed by Parent, pursuant to the terms of the applicable Company Stock Option Plan. Each such Company Option and grant of Restricted Stock so assumed by Parent under this Agreement shall continue to have, and be subject to, the same terms and conditions as set forth in the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price Stock Plans and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent applicable stock option agreement or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") purchase agreement immediately prior to the Effective Time continue (but giving effect to so qualify after changes in such terms and conditions resulting from the Effective Time. Purchaser shall take all corporate action necessary consummation of the Merger), except that (x) such Company Option will be exercisable for that number of whole shares of Parent Common Stock equal to reserve for issuance a sufficient the product of the number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Common Stock underlying such assumed Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased Option immediately prior to the Effective Time, multiplied by the Common Stock Conversion Ratio and rounded down to the extent nearest whole number of payroll deductions accumulated by such participant as shares of Parent Common Stock, (y) the per share exercise price for the shares of Parent Common Stock issuable upon exercise of such offering period end, assumed Company Option will be equal to the number of whole shares of Company Stock at a quotient determined by dividing the exercise price per share price determined pursuant to the provisions of the Company ESPPCommon Stock at which such Option was exercisable immediately prior to the Effective Time by the Common Stock Conversion Ratio, rounded up to the nearest whole cent, and (z) each participant share of Restricted Stock shall receive a cash payment equal be converted into shares of Parent Common Stock pursuant to the balance, if any, of such accumulated payroll deductions remaining Section 2.2(a)(iv). Within five (5) business days after such purchase of such shares. As of the Effective Time, Parent will distribute to each participant shall receive, person who appears as a holder of a Company Option listed on SCHEDULE 3.31 and the Record Schedule (as defined in Section 2.3(b)) a document evidencing the assumption of such Company Option by virtue Parent pursuant to this Section 2.2(d). For purposes of the MergerAgreement, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under "COMPANY STOCK PLANS" shall mean the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof1999 Stock Option/Stock Issuance Plan, plus the cash value of any fraction of a share of Purchaser Common Company 1999 Incentive Stock as provided in Section 1.5(h) hereofOption Plan, plus any dividends or distributions as provided in Section 1and Company 2000 Stock Incentive Plan.

Options. (a) Except as provided in paragraph (b) below with respect Prior to the Company's 1996 Employee Stock Purchase PlanEffective Time, as amended the Board of the Company (or the "Company ESPP")appropriate committee thereof) shall have adopted resolutions to provide that each Option, whether or not vested or exercisable at the Effective Time, each then and which remains outstanding and unexercised option (the "Company Options") exercisable for shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having the same terms and conditions as the Company Options (including such terms and conditions as may be incorporated by reference into the agreements evidencing the Company Options pursuant to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, shall be cancelled, extinguished and no longer outstanding and shall cease to represent the right to acquire shares of Common Stock and in consideration for such cancellation, automatically shall be converted into (i) with respect to each Company Share underlying an Option, the right to receive, without interest, and subject to the extent terms of payroll deductions accumulated by such participant as of such offering period endthis Agreement, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a an amount in cash payment equal to the balanceexcess, if any, of the Closing Per Share Merger Consideration over the exercise price per share attributable to such accumulated payroll deductions remaining after Option (such purchase amount being hereinafter referred to as the "Per Option Merger Consideration"), it being understood that the Per Option Merger Consideration with respect to Options other than In-the-Money Options will be zero; (ii) with respect to holders of such shares. As In-the-Money Options, the Pro Rata Portion of any Escrow Amount that may be payable in respect of the Effective Time, each participant shall receive, by virtue Company Shares underlying such Options as a result of the Merger, the number release of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted any then-remaining Escrow Amount pursuant to the Merger as provided in Section 1.3(aEscrow Agreement and Sections 2.12 and 9.4 of this Agreement; and (iii) hereofwith respect to holders of In-the-Money Options, plus the cash value Pro Rata Portion of any fraction Representative Reimbursement Amount that may be payable in respect of the Company Shares underlying such Options as a share result of Purchaser Common Stock as provided the release of any then-remaining Representative Reimbursement Amount pursuant to the terms and conditions of Section 8.2 hereof. Payments of the Per Option Merger Consideration and the Pro Rata Portion of any Escrow Amount and the Pro Rata Portion of any Representative Reimbursement Amount, in Section 1.5(h) hereofeach case, plus any dividends or distributions as provided in Section 1respect of Options shall be made by the Payments Administrator to the Company for further distribution to the applicable holders of Options through the Company's payroll system in accordance with its normal payroll procedures.

Options. The Executive shall be granted non-statutory stock options covering shares of common stock of the Company (a"Stock"), subject to the following: (i) Except as provided in paragraph (b) below with respect to As of the Employment Commencement Date, the Executive shall be granted a stock option covering 600,000 shares of Stock. Such option shall be granted under the Company's 1996 Employee Amended and Restated 1998 Long-Term Stock Purchase Plan, as amended Ownership Incentive Plan (the "Company ESPPStock Plan"), at and shall have an exercise price of $11.72 per share of Stock. The terms of such option for 600,000 shares shall be reflected in the Effective TimeNotice of Grant of Stock Options and Award Agreement set forth as Supplement 1A to this Agreement, each then outstanding which is attached to and unexercised forms a part of this Agreement. As of the Employment Commencement Date, the Executive shall be granted an additional option (the "Company Options") exercisable for covering 406,500 shares of Company Stock shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option Stock, subject to receive, by virtue of the Merger and without any action on the part of the holder thereof, options exercisable for shares of Purchaser Stock ("Purchaser Replacement Options") having substantially the same terms and conditions as the Company terms applicable to the option granted under the Stock Plan for the 600,000 share option described in the preceding sentence, and shall have an exercise price of $10.90 per share of Stock. The terms of such option for 406,500 shares shall be reflected in the Notice of Grant of Stock Options and Award Agreement set forth as Supplement 1B to this Agreement, which is attached to and forms a part of this Agreement. (including such terms and conditions as may ii) As of the one-year anniversary of the Employment Commencement Date, the Executive shall be incorporated by reference into granted an option covering 500,000 shares of Stock. As of the agreements evidencing two-year anniversary of the Company Options Employment Commencement Date, the Executive shall be granted an option covering an additional 500,000 shares of Stock. The options granted pursuant to this paragraph (ii) shall be granted under the plans Stock Plan or arrangements pursuant a successor to that plan (or, to the extent that no such plan is available for such grants, such grants shall be made outside of any plan). The terms of each such option shall be reflected in the Notice of Grant of Stock Options and Award Agreement set forth as Supplement 1C to this Agreement, which such Company Options were granted) except that is attached to and forms a part of this Agreement. If a Change in Control occurs prior to the exercise price and two-year anniversary of the Employment Commencement Date, then, as of the date immediately prior to the Change in Control, the Executive shall be granted an option covering the excess of 1,000,000 shares of Stock over the number of shares issuable upon exercise covered by options previously granted under this paragraph (ii) (which shall be divided and multiplied, respectively, by in lieu of any additional grants under this paragraph (ii)). The exercise price for each such option granted under this paragraph (ii) shall be the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 fair market value of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective Time. Promptly after the Effective Time, Purchaser shall file or cause to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent to the Effective Time, and shall maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of grant for the option. The obligation under this Agreement under paragraph (ii) to grant an option covering 500,000 shares of Stock on each of the Company ESPP shall continuefirst and second anniversaries of the Employment Commencement Date, and Company Shares to grant an option on a Change in Control, shall be issued to participants thereunder on adjusted in the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than same manner as is required under section 24 of the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant Plan. (iii) Subject to the provisions of paragraph 4, the options shall become vested and exercisable as to one-third of the covered shares on the one-year anniversary of the Employment Commencement Date, and the options shall become vested and exercisable as to an additional 1/36th of the covered shares on the last day of each calendar month following the one-year anniversary of the Employment Commencement Date, provided that the Executive's Date of Termination has not then occurred. It is recited here, for purposes of avoiding ambiguity, that by reason of this paragraph (iii), the options granted under paragraph (ii) above shall be partially vested on the date of grant. In the event of a Change in Control, all options granted under the foregoing provisions of this paragraph (c) shall become fully vested. (iv) Subject to the provisions of paragraph 4, the options shall have a ten-year term beginning on the respective grant date for each option. (v) The options shall be registered on a Form S-8 registration statement which shall remain effective for the term of the options. The options granted under the foregoing provisions of this paragraph (c) shall be treated as a hiring bonus, and are an inducement essential to the Executive's entering into this Agreement. In addition to the Options granted as a hiring bonus in accordance with paragraphs (i) and (ii) above, the Company ESPP, and each participant shall receive a cash payment equal will make annual grants of Stock options to the balanceExecutive based on performance and consistent with the Company's regular compensation practices for executive officers, if any, of such accumulated payroll deductions remaining after such purchase of such sharestaking into account the Executive's position relative to other executives. As In determining the amount of the Effective Time, each participant shall receive, by virtue of annual option grant to the MergerExecutive in any year, the number of whole shares of Purchaser Stock or cash into which Company will not consider the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant hiring bonus options granted to the Merger Executive under paragraphs (i) and (ii) above. Except as otherwise provided in Section 1.3(a) hereofby this paragraph (c), plus the cash value Stock options shall be subject to such terms as are comparable to the terms of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1options granted to other senior executive officers.

Options. (a) Except Effective as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP"), at of the Effective Time, each then outstanding and unexercised option to purchase shares of Target Common Stock (each a “Target Stock Option”) issued pursuant to the equity-based compensation plans identified in Section 4.12(a) of the Target Disclosure Schedule (the "Company Options"“Target Stock Plans”) exercisable for to any current or former employee, director or organizer of, or consultant to, Target shall be assumed by Parent and shall be converted automatically into an option to purchase a number of shares of Company Parent Common Stock (rounded to the nearest whole share) (an “Assumed Stock Option”) at an exercise price determined as provided below (and otherwise subject to the terms of the Target Stock Plans and the agreements evidencing the options thereunder): (i) The number of shares of Parent Common Stock to be subject to the Assumed Stock Option shall become fully vested be equal to the product of the number of shares of Target Common Stock subject to the Target Stock Option and exercisable the Exchange Ratio, provided that any fractional shares of Parent Common Stock resulting from such multiplication shall be rounded to the nearest whole share; and (ii) The exercise price per share of Parent Common Stock under the Assumed Stock Option shall be equal to (A) the exercise price per share of Target Common Stock under the Target Stock Option divided by virtue (B) the Exchange Ratio, provided that such exercise price shall be rounded to the nearest whole cent. In the case of their terms) and Purchaser shall cause each holder of a Company any Target Stock Option to receive, by virtue which Section 421 of the Merger and without any action on the part Code applies by reason of its qualification under Section 422 of the holder thereofCode, options exercisable for shares the conversion formula shall be adjusted, if necessary, to comply with Section 424(a) of Purchaser the Code. Except as otherwise provided herein, the Assumed Stock ("Purchaser Replacement Options") having Options shall be subject to the same terms and conditions as the Company Options (including such terms expiration date, vesting and conditions exercise provisions) as may be incorporated by reference into the agreements evidencing the Company Options pursuant were applicable to the plans or arrangements pursuant to which such Company corresponding Target Stock Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectively. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") immediately prior to the Effective Time continue (but taking into account any changes thereto, including the acceleration of vesting thereof, provided for in the Target Stock Plans or any other Target Benefit Plan or in any award agreement thereunder by reason of this Agreement or the transactions contemplated hereby); provided, however, that references to so qualify after the Effective Time. Purchaser Target shall take be deemed to be references to Parent. (b) Parent has taken all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser Parent Common Stock for delivery upon the exercise of Purchaser Replacement Options after the Effective TimeAssumed Stock Options. Promptly after As soon as reasonably practicable following the Effective TimeClosing Date, Purchaser Parent shall file or cause to be filed all a registration statements statement on Form S-8 or other an appropriate form as may be necessary in connection or a post-effective amendment to a previously filed registration statement under the Securities Act (defined below) with the purchase and sale of Purchaser Stock contemplated by such Purchaser Replacement Options subsequent respect to the Effective Time, issuance of the shares of Parent Common Stock subject to the Assumed Stock Options and shall use its reasonable efforts consistent with customary industry standards to maintain the effectiveness of such registration statement or registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any of the Purchaser Replacement Options registered thereunder such equity awards remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (bc) The current offerings in process as of the date of this Agreement under the Company ESPP shall continue, and Company Shares shall be issued to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, and subject to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less Not later than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, Target shall take all such actions (including, without limitation, approval of any amendment thereto) as are necessary to the extent of payroll deductions accumulated by such participant as of such offering period end, reduce the number of whole shares that remain available for issuance under the Target Stock Plans from and after the Effective Time to zero, such that no holder of any Target Stock Option shall be entitled to receive additional options if the Acquiror shall thereafter increase the number of issued and outstanding shares of Company Stock at a per share price determined pursuant its common stock. Moreover, Target shall reasonably cooperate with efforts by Parent and Acquiror to the provisions secure waivers from each option holder of the Company ESPP, and each participant shall receive a cash payment equal to the balancesuch option holder’s right, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of to receive additional options in the Effective Timeevent that Target, each participant Acquiror or Parent shall receive, by virtue of the Merger, the number of whole issue additional shares of Purchaser Stock or cash into which capital stock from and after the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) date hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1.

Options. (ai) Except as provided in paragraph (b) below with respect to the Company's 1996 Employee Stock Purchase Plan, as amended (the "Company ESPP")HBO and McKesson will take all action necessary such that, at the Effective Time, each then option granted by HBO to purchase shares of HBO Common Stock which is outstanding immediately prior thereto shall cease to represent a right to acquire shares of HBO Common Stock and unexercised shall be converted into an option to purchase shares of McKesson Common Stock in an amount and at an exercise price determined as provided below (and otherwise, in the case of options, subject to the terms of the HBO Stock Plans (as defined in Section 3.2(c)) and the agreements evidencing grants thereunder) (the "Company Assumed Options"): (1) exercisable for The number of shares of Company McKesson Common Stock to be subject to the new option shall become fully vested and exercisable (by virtue of their terms) and Purchaser shall cause each holder of a Company Option be equal to receive, by virtue the product of the Merger number of shares of HBO Common Stock subject to the original option and without the Exchange Ratio, provided that any action on fractional shares of McKesson Common Stock resulting from -------- such multiplication shall be rounded to the part nearest whole share; and (2) The exercise price per share of McKesson Common Stock under the new option shall be equal to the exercise price per share of HBO Common Stock under the original option divided by the Exchange Ratio, provided -------- that such exercise price shall be rounded to the nearest whole cent. (ii) The adjustment provided herein with respect to any options that are "incentive stock options" (as defined in Section 422 of the holder thereofCode) shall be and is intended to be effected in a manner that is consistent with Section 424(a) of the Code. The duration and other terms of the new options shall be the same as the original options except that all references to HBO shall be deemed to be references to McKesson. (iii) As soon as practicable following the Effective Time, options exercisable for shares McKesson shall deliver, upon due surrender of Purchaser the Assumed Options to holders of Assumed Options appropriate option agreements representing the right to acquire McKesson Common Stock ("Purchaser Replacement Options") having on the same terms and conditions as contained in the Company Assumed Options (including such except as otherwise set forth in this Section 2.1(e)). Except as expressly contemplated herein, McKesson shall comply with the terms and conditions of the HBO Stock Plans as may be incorporated by reference into the agreements evidencing the Company Options pursuant they apply to the plans or arrangements pursuant to which such Company Options were granted) except that the exercise price and the number of shares issuable upon exercise shall be divided and multiplied, respectively, by the Conversion Fraction, and rounded to the nearest whole cent or number, respectivelyAssumed Options. Purchaser shall use all reasonable efforts to ensure that any Company Options that qualified as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") prior to the Effective Time continue to so qualify after the Effective Time. Purchaser McKesson shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Purchaser McKesson Common Stock for delivery upon the exercise of Purchaser Replacement the Assumed Options after the Effective Timein accordance with this Section 2.1(e). Promptly after McKesson shall file a registration statement on Form S-8 (or any successor form) or on another appropriate form, and use commercially reasonable efforts to have such registration statement declared effective reasonably promptly following the Effective Time, Purchaser shall file or cause with respect to be filed all registration statements on Form S-8 or other appropriate form as may be necessary in connection with the purchase and sale of Purchaser McKesson Common Stock contemplated by such Purchaser Replacement Options subsequent subject to the Effective Time, Assumed Options and shall use commercially reasonable efforts to maintain the effectiveness of such registration statement or registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as any the Assumed Options remain outstanding and exercisable. (iv) McKesson acknowledges and agrees that the consummation of the Purchaser Replacement Merger will have certain effects in respect of the Assumed Options registered thereunder remain outstanding. As soon as practicable after the Effective Time, Purchaser shall qualify under applicable state securities laws the issuance of such shares of Purchaser Stock issuable upon exercise of Purchaser Replacement Options. Purchaser's Board of Directors shall take all actions necessary on the part of Purchaser to enable the acquisition of Purchaser Stock, Purchaser Replacement Options and subsequent transactions reflected in Purchaser Stock after the Effective Time pursuant to Purchaser Replacement Options by persons subject to the reporting requirements of Section 16(a2.1(e)(iv) of the Securities Exchange Act (as defined below) to be exempt from the application of Section 16(b) of the Securities Exchange Act, to the extent permitted thereunder. (b) The current offerings in process as of the date of this Agreement under the Company ESPP shall continueHBO Disclosure Schedule, and Company Shares shall be issued McKesson agrees to participants thereunder on the next currently scheduled purchase dates thereunder occurring after the date hereof as provided under, act in accordance therewith and subject give full effect to the terms and conditions of, the Company ESPP. The Company may, consistent with past practice, commence new offering periods under the Company ESPP on or after the date hereof and prior to the Effective Time at an exercise price for each such offering not less than as is required under the Company ESPP. Immediately prior to the Effective Time, pursuant to the Company ESPP, all offerings under the Company ESPP shall be terminated, and each participant shall be deemed to have purchased immediately prior to the Effective Time, to the extent of payroll deductions accumulated by such participant as of such offering period end, the number of whole shares of Company Stock at a per share price determined pursuant to the provisions of the Company ESPP, and each participant shall receive a cash payment equal to the balance, if any, of such accumulated payroll deductions remaining after such purchase of such shares. As of the Effective Time, each participant shall receive, by virtue of the Merger, the number of whole shares of Purchaser Stock or cash into which the shares of Company Stock such participant has so purchased under the Company ESPP have been converted pursuant to the Merger as provided in Section 1.3(a) hereof, plus the cash value of any fraction of a share of Purchaser Common Stock as provided in Section 1.5(h) hereof, plus any dividends or distributions as provided in Section 1same.