Common use of Put Procedures Clause in Contracts

Put Procedures. Pursuant to the Put Right, the Participant may elect to exercise his right to require the Company to purchase all or any portion of the Puttable Options or Puttable Shares by delivering written notice or notices (each, a “Put Notice”) to the Company. To the extent the Participant is exercising the Put Right with respect to the Puttable Shares, the Company shall be required to repurchase such Shares at a price per share equal to the Fair Market Value thereof determined by the Board on the date of the Put Closing (as defined in Section 3(c) below) after taking due consideration of (but not being bound by) the Formula Price (as defined below). If the Participant is exercising the Put Right with respect to any Puttable Options, the Company shall be required to purchase each such Puttable Option at a price per Share equal to the excess, if any, of the Fair Market Value of a Share, over the per Share exercise price of such Puttable Option. If the Participant believes that Fair Market Value is greater than the Fair Market Value determined by the Board, then the Participant may deliver a written objection notice to the Board within ten (10) business days of such determination (an “Objection Notice”), setting forth the Participant’s estimate of Fair Market Value (the “Participant’s Estimated Fair Market Value”). If the Participant timely delivers such an Objection Notice, the Company will promptly engage an Independent Appraiser. The Independent Appraiser will be engaged to deliver to the Board and the Participant a written determination (such determination to include a report setting forth all material analyses used in arriving at such determination) within thirty (30) days of being engaged stating the Independent Appraiser’s determination of Fair Market Value, which determination shall be made after taking due consideration of (but not being bound by) the Formula Price. If the Independent Appraiser’s determination of Fair Market Value exceeds the Fair Market Value as determined by the Board, the repurchase price for the Puttable Shares and the Puttable Options shall instead be determined using either the Fair Market Value determined by the Independent Appraiser, or, if the Fair Market Value determined by the Independent Appraiser exceeds the Formula Price, the Formula Price. If the Fair Market Value determined by the Independent Appraiser is less than ninety percent (90%) of the Participant’s Estimated Fair Market Value, the Participant may rescind his Put Notice by delivering a notice of rescission (the “Rescission Notice”) to the Board within ten (10) business days of the Independent Appraiser’s determination. The Company shall pay the costs and expenses of such Independent Appraiser. The Participant may not request a determination by an Independent Appraiser more than once per fiscal quarter of the Company. For purposes of the foregoing, “Independent Appraiser” means a nationally recognized independent third party appraiser retained by the Board that is acceptable to the Participant and the Board; and the “Formula Price” means the amount paid for a Share subject to the Put Right determined as if the Company’s enterprise value was equal to eight (8) times Adjusted EBITDA (as defined in the Award Certificate for the Initial Option) for the four (4) fiscal quarters preceding the last date on which GAAP quarterly financial statements were prepared less the average of the capital expenditures as reported on the Company’s audited financial statements for the twelve (12) fiscal quarters preceding the last date on which GAAP quarterly financial statements were prepared less average net debt (i.e, indebtedness for borrowed money and capitalized leases (using the classification under GAAP in existence on the date hereof) minus average cash), for the prior four (4) fiscal quarters determined using the monthly ending balance of debt and cash during such four (4) quarter period, plus the exercise prices of all then outstanding options and warrants divided by the fully diluted number of Shares of the Company then outstanding (including all Shares issuable upon the exercise of options and warrants) (the “Formula Price”).