Common use of Earn-Out Clause in Contracts

Earn-Out. (a) As part of the Acquisition Consideration, Purchaser shall pay Earn-Out Payments, if any are earned, on the following terms and conditions: (i) for each of the 2017 calendar year (the “2017 Earn-Out Period”) and the 2018 calendar year (the “2018 Earn-Out Period”) (each such earn-out period, an “Earn-Out Period” and collectively, the “Earn-Out Term”), Purchaser shall pay to those employees listed on Schedule 1.3 and remaining with the Company following Closing and at the time of the applicable Earn-Out Payment (the “Key Employees”) an amount of restricted shares of Purchaser common stock equal to such percentage (up to 120%) of the 2017 Revenue Target or 2018 Revenue Target achieved, respectively, multiplied by the quotient of (x) $600,000 divided by 80% of the OTCQB marketplace (or Nasdaq Stock Market or any national exchange or marketplace on which shares are traded) closing price per share of Purchaser’s common stock on the date of the applicable Earn-Out Payment, and (ii) for each Earn-Out Period as applicable, Purchaser shall pay to the Key Employees an amount of restricted shares of Purchaser common stock equal to such percentage (up to 120%) of the 2017 EBITDA Target or 2018 EBITDA Target achieved, respectively, multiplied by the quotient of (x) $600,000 divided by (y) 80% of the OTCQB marketplace (or Nasdaq Stock Market or any national exchange or marketplace on which shares are traded) closing price per share of Purchaser’s common stock on the date of the applicable Earn-Out Payment (each such payment by the Purchaser to the Key Employees in respect of the achievement of the 2017 Revenue Target, 2018 Revenue Target, 2017 EBITDA Target or 2018 EBITDA Target, an “Earn-Out Payment”).

Earn-Out. The Escrow Property shall be held in the Escrow Account and, subject to Article VIII and this Article II, will only be released to the Sellers (aalong with the Accrued Dividends) As part of in the Acquisition Considerationevent that the Purchaser, Purchaser shall pay the Company and their respective Subsidiaries meet certain minimum performance requirements in accordance with this Article II. Subject to Article VIII and this Article II, in the event that (i) the Adjusted Net Income for the calendar year ended December 31, 2016 exceeds the 2016 Earn-Out PaymentsTarget, if any are earned, on (ii) the following terms and conditions: (i) Adjusted Net Income for each of the 2017 calendar year (ended December 31, 2017 exceeds the “2017 Earn-Out Period”Target or (iii) and the 2018 Adjusted Net Income for the calendar year (ended December 31, 2018 exceeds the “2018 Earn-Out Period”) (each such earn-out period, an “Earn-Out Period” and collectivelyTarget, the “Earn-Out Term”), Purchaser Sellers shall pay collectively be entitled to those employees listed on Schedule 1.3 and remaining with the Company following Closing and at the time of the applicable Earn-Out Payment receive (the “Key Employees”) an amount of restricted shares of Purchaser common stock equal to such percentage (up to 120%) of the 2017 Revenue Target or 2018 Revenue Target achieved, respectively, multiplied by the quotient of (x) $600,000 divided by 80% of the OTCQB marketplace (or Nasdaq Stock Market or any national exchange or marketplace on which shares are traded) closing price per share of Purchaser’s common stock on the date of the applicable Earn-Out Payment, and (ii) for each Earn-Out Period as applicable, Purchaser shall pay to the Key Employees an amount of restricted shares of Purchaser common stock equal to such percentage (up to 120%) of the 2017 EBITDA Target or 2018 EBITDA Target achieved, respectively, multiplied by the quotient of (x) $600,000 divided by (y) 80% of the OTCQB marketplace (or Nasdaq Stock Market or any national exchange or marketplace on which shares are traded) closing price per share of Purchaser’s common stock on the date of the applicable Earn-Out Payment (each such payment by the Purchaser to the Key Employees in respect of the achievement of the 2017 Revenue Target, 2018 Revenue Target, 2017 EBITDA Target or 2018 EBITDA Targeteach, an “Earn-Out Payment”) from the Escrow Account, in each case, one-third (1/3rd) of the Escrow Shares, and from the Purchaser the Accrued Dividends on such one-third (1/3rd) portion of the Escrow Shares, subject to maximum Earn-Out Payments in the aggregate for all three calendar years 2016, 2017 and 2018 together (each such calendar year, an “Earn-Out Year”, and such three-year calendar period, the “Earn-Out Period”) equal to the Escrow Property plus the Accrued Dividends. In the event that the above Adjusted Net Income targets are not met for any Earn-Out Year, the Sellers shall not be entitled to receive any Earn-Out Payment for such Earn-Out Year and shall forfeit any right to such Escrow Property and Accrued Dividends with respect to such Earn-Out Year; provided, however, that in the event that at the end of the Earn-Out Period the average Adjusted Net Income per Earn-Out Year for all three Earn-Out Years exceeds the Alternative Earn-Out Target (each of the 2016 Earn-Out Target, the 2017 Earn-Out Target, the 2018 Earn-Out Target and the Alternative Earn-Out Target, an “Earn-Out Target”), the Sellers shall collectively be entitled to receive all of the Escrow Property and Accrued Dividends that they previously did not receive (such payment the “Alternative Earn-Out Payment”, with such Alternative Earn-Out Payment considered an additional Earn-Out Payment). For the avoidance of doubt, failure to qualify for an Earn-Out Payment in any Earn-Out Year during the Earn-Out Period shall not prevent the Sellers from being able to collectively receive an Earn-Out Payment in a subsequent Earn-Out Year during the Earn-Out Period. If for any Earn-Out Year there is a final determination in accordance with Section 2.2 that the Sellers are entitled to receive an Earn-Out Payment for such Earn-Out Year or the Alternative Earn-Out Payment, then within five (5) Business Days after such final determination, the Purchaser, the DT Representative and the Seller Representative will provide joint written instructions to the Escrow Agent to release to the Sellers Escrow Property from the Escrow Account (and Purchaser shall pay the Accrued Dividends) in an aggregate amount (of Escrow Property and Accrued Dividends) equal to (i) such Earn-Out Payment less (ii) the aggregate amount of any indemnification claims by any Indemnified Parties under Article VIII that (A) are pending, (B) have been finally determined as due and owing but are unpaid from the Escrow Account in accordance with Article VIII or (C) have been paid from the Escrow Account in accordance with Article VIII but have not previously been used to reduce the amount of any prior Earn-Out Payment, with each Seller receiving its Pro Rata Share of such net Earn-Out Payment. At the end of the Earn-Out Period, if there is any Escrow Property and/or Accrued Dividends which the Sellers are not entitled to receive in accordance with this Article II, such Escrow Property and/or Accrued Dividends will be forfeited by the Sellers and distributed to Purchaser from the Escrow Account in the case of Escrow Property, or retained by the Purchaser, in the case of Accrued Dividends, and within five (5) Business Days after a final determination in accordance with Section 2.2 that at the end of the Earn-Out Period there is such Escrow Property to which the Sellers are not entitled to receive, the Purchaser, the DT Representative and the Seller Representative will provide joint written instructions to the Escrow Agent to release such Escrow Property to the Purchaser. The Purchaser will cancel any Escrow Shares distributed to the Purchaser from the Escrow Account promptly after its receipt thereof and cancel any Accrued Dividends payable in respect of such Escrow Shares. Each Seller acknowledges that such Seller’s right to receive the Escrow Shares, other Escrow Property and Accrued Dividends is contingent based on the performance of the Purchaser, the Company and their respective Subsidiaries for periods including those after the Closing as set forth in this ‎Article II, and that if the requirements for the payment of the Earn-Out Payments as set forth in this Article II are not met in accordance with the terms hereof, the Escrow Shares, the other Escrow Property and the Accrued Dividends will not be paid or delivered to the Sellers, and the Sellers shall have no right to receive such Escrow Shares, other Escrow Property or Accrued Dividends.

Earn-Out. (a) As part of the Acquisition Consideration, Purchaser shall pay Earn-Outs; Earn-Out Payments, if any are earned, on Milestones. Schedule 1.14 sets forth the following terms and conditions: four (i4) for each components of the 2017 calendar year (the “2017 Earn-Out Period”) and the 2018 calendar year Amount (the “2018 each an "Earn-Out Period”) (each such earn-out period, an “Earn-Out Period” Out" and collectively, the “"Earn-Outs"), and the applicable milestone contingencies (each, an "Earn-Out Term”), Purchaser shall pay to those employees listed on Schedule 1.3 Milestone" and remaining with collectively the Company following Closing and at the time of "Earn-Out Milestones") that must be satisfied by the applicable Earn-Out Payment (Date in order for such contingencies to be removed and the “Key Employees”) an amount of restricted shares of Purchaser common stock equal Broadcom Common Stock that relate to such percentage Earn-Out to be (up i) released to 120%) the stockholders of the 2017 Revenue Target Company from the Earn-Out Escrow or 2018 Revenue Target achievedthe Option Escrows, respectivelyas applicable, multiplied or (ii) issued directly to the holder of a Company Option that is exercised after such Earn-Out Milestone is satisfied. As soon as reasonably practicable after the Effective Time, the Early Earn-Out Amount, without any act of any stockholder, will be deposited with the Depositary Agent (plus a proportionate share of any additional shares of Broadcom Common Stock as may be issued upon any stock splits, stock dividends or recapitalizations effected by Broadcom following the Effective Time), such deposit to constitute the "Earn-Out Escrow" to be governed by the quotient of (x) $600,000 divided by 80% terms set forth herein. The portion of the OTCQB marketplace (Early Earn-Out Amount contributed into the Earn-Out Escrow on behalf of each stockholder of the Company shall be in proportion to the aggregate number of shares of Broadcom Common Stock which such holder would otherwise be entitled under Section 1.6 as a result of the Earn-Out Exchange Ratio. Except as set forth in Schedule 1.14, no Earn-Out is subject to increase to make up for any reduction or Nasdaq Stock Market or forfeiture of any national exchange or marketplace on which shares are traded) closing price per share of Purchaser’s common stock on the date of other Earn-Out. If an Earn-Out is satisfied by the applicable Earn-Out PaymentDate, and an appropriate portion (ii) for each based on the portion of the Earn-Out Period Amount that such Earn-Out represents) of the shares of Broadcom Common Stock (x) deposited into the Earn-Out Escrow and the Option Escrows shall be distributed out of the Earn-Out Escrow and the Option Escrows, as applicable, Purchaser shall pay to the Key Employees an amount of restricted shares of Purchaser common stock equal to such percentage (up to 120%in accordance with Section 1.14(g) of the 2017 EBITDA Target or 2018 EBITDA Target achieved, respectively, multiplied by the quotient of (xand Section 1.6(d)(iv) $600,000 divided by and (y) 80% to be issued upon the exercise of the OTCQB marketplace (or Nasdaq Stock Market or any national exchange or marketplace on which shares are traded) closing price per share of Purchaser’s common stock on the date of the applicable a Company Option after such Earn-Out Payment (each such payment by the Purchaser Milestone is satisfied shall be issued directly to the Key Employees in respect holder of the achievement of the 2017 Revenue Target, 2018 Revenue Target, 2017 EBITDA Target or 2018 EBITDA Target, such Company Option upon such exercise rather than being deposited into an “Earn-Out Payment”)Option Escrow.

Earn-Out. (a) As part of the Acquisition Merger Consideration, Purchaser Digirad shall pay Earn-Out Payments, if any are earnedany, to the Stockholders on the following terms and conditions: (i) for each of the 2017 calendar year (2015 Earn-Out Period, the “0000 Xxxx-Xxx Period, and the 2017 Earn-Out Period”) and the 2018 calendar year (the “2018 Earn-Out Period”) Period (each such earn-out period, an “Earn-Out Period” and collectively, the “Earn-Out Term”), Purchaser to the extent the EBITDA earned by the Surviving Corporation exceeds the applicable Earn-Out Threshold for that Earn-Out Period, Digirad shall pay to those employees listed on Schedule 1.3 and remaining with each Stockholder his or her Pro Rata Share of fifty percent (50%) of EBITDA earned by the Company following Closing and at the time Surviving Corporation in excess of the applicable Earn-Out Payment (Threshold for the “Key Employees”) an amount of restricted shares of Purchaser common stock equal to such percentage (up to 120%) of the 2017 Revenue Target or 2018 Revenue Target achieved, respectively, multiplied by the quotient of (x) $600,000 divided by 80% of the OTCQB marketplace (or Nasdaq Stock Market or any national exchange or marketplace on which shares are traded) closing price per share of Purchaser’s common stock on the date of the applicable Earn-Out Payment, and (ii) for each related Earn-Out Period as applicable, Purchaser shall pay to the Key Employees an amount of restricted shares of Purchaser common stock equal to such percentage (up to 120%) of the 2017 EBITDA Target or 2018 EBITDA Target achieved, respectively, multiplied by the quotient of (x) $600,000 divided by (y) 80% of the OTCQB marketplace (or Nasdaq Stock Market or any national exchange or marketplace on which shares are traded) closing price per share of Purchaser’s common stock on the date of the applicable Earn-Out Payment (each such payment by the Purchaser to the Key Employees in respect of the achievement of the 2017 Revenue Target, 2018 Revenue Target, 2017 EBITDA Target or 2018 EBITDA Target, an “Earn-Out Payment”), subject to clause 2.13(a)(ii) below; (ii) fifty percent (50%) of all Earn-Out Payments for the 2015 and 2016 Earn-Out Periods shall be retained by Digirad (and shall accrue interest at a rate of 90-day LIBOR plus 2% simple interest per annum) until the end of the Earn-Out Term in order to satisfy resolution of any Potential Claims and to pay expenses related thereto (the “Earn-Out Escrow”), at which time any amount remaining of the Earn-Out Escrow (plus accrued interest) shall be paid to the Stockholders (with each Stockholder receiving his or her Pro Rata Share); and (iv) in the aggregate, the Earn-Out Payments shall not exceed $400,000 for the entire Earn-Out Term. By way of illustration and not limitation: (A) if during the 2015 Earn-Out Period (that portion of the 2015 calendar year beginning on the Closing Date), the EBITDA achieved by the Surviving Corporation is $300,000 in excess of the Earn-Out Threshold for such period, such excess EBITDA will be divided $75,000 to the Stockholders (with each Stockholder receiving his or her Pro Rata Share), $75,000 to Digirad for inclusion in the Earn-Out Escrow, and $150,000 to Digirad, (B) if during the 2016 Earn-Out Period (the 2016 calendar year), the EBITDA achieved by the Surviving Corporation is $450,000 in excess of the Earn-Out Threshold for such period, such excess EBITDA will be divided $112,500 to the Stockholders (with each Stockholder receiving his or her Pro Rata Share), $112,500 to Digirad for inclusion in the Earn-Out Escrow, and $225,000 to Digirad, (C) if during the 2017 Earn-Out Period (the 2017 calendar year), the EBITDA achieved by the Surviving Corporation is $50,000 in excess of the Earn-Out Threshold for such period, such excess EBITDA will be divided $25,000 to the Stockholders (with each Stockholder receiving his or her Pro Rata Share) and $25,000 to Digirad and (D) if Digirad used $100,000 of the Earn-Out Escrow amount in connection with expenses related to Potential Claims, Digirad would release $87,500 to the Stockholders (with each Stockholder receiving his or her Pro Rata Share) at the conclusion of the Earn-Out Term.