Common use of Treatment of Company Stock Options Clause in Contracts

Treatment of Company Stock Options. Prior to the Effective Time, the Company shall take such action as may be necessary to cause each option for the purchase of Company Common Stock (a “Company Stock Option”) then outstanding, whether or not exercisable, under each of the Company’s 1993 Stock Plan, the Company’s 1996 Stock Plan or the Company’s 1998 Stock Plan (together, the “Company Stock Plans”), to become (if not then fully exercisable) fully exercisable, except for Company Stock Options held by employees who have been terminated prior to the Effective Time or by holders who have failed to achieve performance standards necessary for the vesting of such Company Stock Options, and each such Company Stock Option that is vested and exercisable shall thereafter represent the right to receive, for each share of Company Common Stock subject to such Company Stock Option, an amount in cash equal to the difference between (i) the Merger Consideration payable in respect of a share of Company Common Stock and (ii) the per share exercise price of such Company Stock Option, but only to the extent such difference is a positive number (such amount in cash as described above being hereinafter referred to as the “Option Consideration”). The parties agree that the cancellation of the Company Stock Options in exchange for the right to receive the Option Consideration pursuant to Section 2.2 and Section 2.4 is a transaction properly allocable to the portion of the Company’s day occurring after the Closing pursuant to Treasury Regulation Section 1.1502-76(b)(1)(ii)(B) and, consequently, shall be treated for Tax purposes as occurring at the beginning of the day following the Closing and any deductions resulting therefrom are properly reportable on Parent’s consolidated federal income tax return (and any applicable state or local income tax returns). The parties shall, and shall cause their respective Affiliates to, report consistently with the foregoing for all Tax purposes

Treatment of Company Stock Options. Prior Each option (or portion thereof) outstanding immediately prior to the Effective Time, the Company shall take such action as may be necessary Time to cause each option for the purchase shares of Company Common Stock (a “Company Stock Option”) then outstanding, whether or not exercisable, under each any stock option plan of the Company’s 1993 , including the TeleCommunication Systems, Inc. Amended and Restated Stock Plan, Incentive Plan and any other prior plan agreement or arrangement of the Company’s 1996 Stock Plan or the Company’s 1998 Stock Plan Company (togethercollectively, the “Company Stock PlansEquity Plan”), to become (if not then fully exercisable) fully exercisableshall, except for Company Stock Options held by employees who have been terminated prior to at the Effective Time or by holders who have failed to achieve performance standards necessary Time, automatically and without any required action on the part of the holder thereof, be canceled in consideration for the vesting of such Company Stock Options, and each such Company Stock Option that is vested and exercisable shall thereafter represent the right to receive, for each share receive a cash payment with respect thereto equal to the product of (x) the total number of shares of Company Common Stock subject to such canceled Company Stock Option as of the Effective Time and (y) the excess, if any, of (A) the Per Share Merger Consideration over (B) the exercise price per share subject to such canceled Company Stock Option, an amount in cash equal to without interest (such amounts payable hereunder, the difference between “Option Payments”); provided, however, that (i1) the Merger Consideration payable in respect of a share of Company Common Stock and (ii) the per share exercise price of any such Company Stock Option, but only Option with respect to which the extent exercise price per share subject thereto is equal to or greater than the Per Share Merger Consideration shall be canceled in exchange for no consideration and (2) such difference is a positive number (such Option Payments may be reduced by the amount of any required Tax withholdings as provided in cash as described above being hereinafter referred to as the “Option Consideration”Section 2.10(h). The parties agree that Surviving Corporation shall cause each Option Payment to be paid, less any required Tax withholdings, as promptly as practicable following the cancellation of Effective Time through its payroll systems. From and after the Effective Time, no Company Stock Options in exchange for Option shall be outstanding and each Company Stock Option shall only entitle the right to receive the Option Consideration pursuant to Section 2.2 and Section 2.4 is a transaction properly allocable holder thereof to the portion of the Company’s day occurring after the Closing pursuant to Treasury Regulation payment provided for in this Section 1.1502-76(b)(1)(ii)(B) and, consequently, shall be treated for Tax purposes as occurring at the beginning of the day following the Closing and any deductions resulting therefrom are properly reportable on Parent’s consolidated federal income tax return (and any applicable state or local income tax returns2.09(d)(i). The parties shall, and shall cause their respective Affiliates to, report consistently with the foregoing for all Tax purposes.