Common use of Stock Options Clause in Contracts

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At Immediately prior to the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company CAC Common Stock under the Company Equity Plans (each, a “Company CAC Stock Option”) shall vest and become fully exercisablewill, whether or not then vested or subject to any performance condition that has not been satisfied. At at the Effective Time, each Company cease to represent an option to purchase CAC Common Stock Option shall and will be converted automatically into an option to purchase the a number of shares of Parent CEC Common Stock (each, a “Converted Stock Option”) equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share)) of (i) the number of shares of CAC Common Stock subject to such CAC Stock Option and (ii) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to (x) the exercise price for each of such share of Company Common Stock subject to a Company CAC Stock Option divided by (y) the Exchange Ratio, and each unvested CAC Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted granted pursuant to the terms of this Section 2.4(a) Caesars Acquisition Company 2014 Performance Incentive Plan shall be referred amended to provide that it shall become vested and exercisable (at target performance levels, if applicable) upon the optionee’s termination of employment without “cause” (as a “Parent Exchange Option.” In connection with defined in the issuance Caesars Acquisition Company 2014 Performance Incentive Plan) by the Surviving Entity or any of Parent Exchange Optionsits Subsidiaries or for Good Reason (as defined herein), Parent shall reserve for issuance in either case within six (6) months following the number of shares of Parent Common Stock that will become subject Effective Time. Prior to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent the CAC Board shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or adopt appropriate resolutions and take all other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts actions necessary to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “each CAC Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment be converted, assumed and amended, as applicable, in accordance with Section 2.1(d)the foregoing. The number Following the Effective Time, except for the amendment of shares subject the unvested CAC Stock Options granted pursuant to any Parent Exchange the Caesars Acquisition Company 2014 Performance Incentive Plan, each Converted Stock Option will continue to be governed by the same terms and conditions as were applicable under the exercise price per share of such Parent Exchange CAC Stock Plan for each CAC Stock Option immediately prior to the Effective Time. Immediately prior to the Effective Time, each outstanding and unvested CEC Stock Option granted under to the Caesars Entertainment Corporation 2012 Performance Incentive Plan shall be determined in a manner which would not result amended to provide that it shall become vested and exercisable (at target performance levels, if applicable) upon the optionee’s termination of employment without “cause” (as defined in the conversion Caesars Entertainment Corporation 2012 Performance Incentive Plan) by the Surviving Entity or any of Company Stock Options into Parent Exchange Options being treated its Subsidiaries or for Good Reason (as a new grant of stock options under Section 409A of defined herein), in either case within six (6) months following the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsEffective Time.

Stock Options. (i) At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire Company Shares (a share of "Company Common Stock Option") under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisablePlans, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Timeunvested, each Company Stock Option shall be converted into deemed to constitute an option to purchase acquire, on the same terms and conditions as were applicable under such Company Option (except to the extent such terms and conditions are altered in accordance with their terms as a result of the consummation of the transactions contemplated by this Agreement), the same number of shares of Parent SBC Common Stock equal as the holder of such Company Option would have been entitled to receive pursuant to the product of (x) the Stock Merger had such holder exercised such Company Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained full immediately prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole sharenumber) (a "Substitute Option"), at an exercise price per share (rounded up to the nearest centwhole cent)(the "Substitute Option Price") equal to (y) the aggregate exercise price for each the Company Shares otherwise purchasable pursuant to such share of Company Common Stock subject to a Company Stock Option divided by (z) the number of full shares of SBC Common Stock deemed purchasable pursuant to such Company Option Conversion Fractionin accordance with the foregoing. For each Substitute Option substituted for a Company Option that included a right under certain circumstances to receive dividend equivalents in the form of stock units ("Company Stock Units"), and all references Company Stock Units credited to the Company in each account of the holder of such option shall Substitute Option at the Effective Time shall, as of the Effective Time, be deemed to refer constitute a number of stock units, each of which shall represent one share of SBC Common Stock ("SBC Stock Units"), equal to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent SBC Common Stock the holder of such Substitute Option would have been entitled to receive pursuant to this Agreement had such Company Stock Units been distributed to such holder in full immediately prior to the Effective Time and thereafter SBC Stock Units shall continue to be credited to the account of the holder of such Substitute Option to the same extent and on the same terms and conditions as they would have under the Company Option for which the Substitute Option was substituted (except that will become subject the record dates and dividend amounts shall be the record dates and dividend amounts for SBC Common Stock), and all such SBC Stock Units shall be distributed at the same times and in the same manner as the Company Stock Units would have been distributed had the Substitute Option not been substituted for the Company Option (except that the option price used to Parent Exchange determine if the SBC Stock Units can be distributed shall be the Substitute Option Price). At or prior to the Effective Time, the Company shall make all necessary arrangements with respect to the Company Stock Plans to permit the assumption of the unexercised Company Options by SBC pursuant to this Section 2.4(a). As promptly and as reasonably soon as practicable after the Effective Time, Parent Time SBC shall issue use its best efforts to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) register under the Securities Act on Form S-8 or other appropriate form (and use its best efforts to maintain the Closing Date with respect to the effectiveness thereof) shares of Parent SBC Common Stock subject issuable pursuant to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange all Substitute Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At the Effective Time, each option outstanding unexpired (and unexercised option which by its terms does not lapse on or before the Effective Time) to purchase or acquire a share of Company Common Stock (a "COMPANY STOCK OPTION") granted under the Company's 1993 Employee Stock Option Plan, as amended (the "COMPANY EMPLOYEE OPTION PLAN"), or the Company's 1993 Outside Director Stock Option Plan (the "COMPANY DIRECTOR PLAN" and, together with the Company Equity Plans (eachEmployee Option Plan, a “Company Stock Option”) shall vest and become fully exercisablethe "COMPANY OPTION PLANS"), whether or not then vested or subject exercisable, shall be replaced by a comparable option to purchase Parent Common Stock (a "PARENT STOCK OPTION"), after giving effect to the requirements of the Company Option Plans (including without limitation any performance condition that has not been satisfiedprovisions with respect to a change of control of the Company) pursuant to which it was granted and any stock option agreement by which it is evidenced. At Notwithstanding the foregoing, in the event that, as of the Effective Time, Parent shall not have reserved a sufficient number of shares for issuance upon exercise of each of the Parent Stock Options contemplated by this Section 2.5, then, to the extent of such deficiency and on a pro rata basis, each holder of a Company Stock Option (whether or not then vested or exercisable) shall be entitled to receive, immediately prior to the Effective Time, cash in an amount equal to the difference between (A) the Base Consideration Value minus (B) the per-share exercise price of the applicable Company Stock Option. It is intended that the foregoing provisions shall be undertaken in a manner that will not constitute a "modification" as defined in Section 424 of the Code as to any stock option which is an "incentive stock option." Each Parent Stock Option shall be converted into an option to purchase the exercisable for that number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of the Company Common Stock which could have been obtained prior Shares subject to the Effective Time upon the exercise of each such corresponding Company Stock Option multiplied by the Stock Exchange Ratio, and shall have an exercise price per share equal to its exercise price per Company Share divided by the Stock Exchange Ratio (the "Adjusted Strike Price"). Any resulting fractional share of Parent Common Stock shall be rounded down to the nearest whole share), at share and Parent shall pay an exercise price per share (rounded up amount in cash to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms holder of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant at the Effective Time equal to the terms product of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares such fractional share of Parent Common Stock that will become subject multiplied by an amount equal to the Stock Value minus the Adjusted Strike Price. Parent Exchange Options pursuant and the Company shall use commercially reasonable efforts to take all such steps as may be required to cause the transactions contemplated by this Section 2.4(a). As promptly as reasonably practicable after 2.5 and any other dispositions of equity securities of the Company or dispositions of Parent equity securities in connection with this Agreement by each individual who (i) is a director or officer of the Company or (ii) at the Effective Time, Parent shall issue will become a director or officer of Parent, to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) be exempt under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration Rule 16b-3 of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsAct.

Stock Options. At (i) On the Effective TimeDate, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableFBKP Option which is then outstanding, whether or not then vested or subject exercisable, shall cease to any performance condition that has not been satisfied. At the Effective Time, each Company represent a right to acquire shares of FBKP Common Stock Option and shall be converted automatically into an option to purchase the number of shares of Parent PSB Common Stock equal to Stock, and PSB shall assume each FBKP Option, in accordance with the product terms of (x) the FBKP Stock Option Conversion Fraction Plan, the FBKP Standby Options and the stock option agreements and certificates by which they are evidenced, except that from and after the Effective Date, (as defined in this Section 2.4(a)i) multiplied PSB and its Board of Directors or a duly authorized committee thereof shall be substituted for FBKP and FBKP's Board of Directors or duly authorized committee thereof administering such FBKP Stock Option Plan, (ii) each FBKP Option assumed by PSB may be exercised solely for shares of PSB Common Stock, (yiii) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company PSB Common Stock subject to a Company Stock such FBKP Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed equal to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent FBKP Common Stock subject to Parent such FBKP Option immediately prior to the Effective Date multiplied by the Applicable Exchange Options Ratio, provided that any fractional shares of PSB Common Stock resulting from such multiplication shall be rounded to the nearest share, and (iv) the per share exercise price under each such FBKP Option shall use its commercially reasonable efforts be adjusted by dividing the per share exercise price under each such FBKP Option by the Applicable Exchange Ratio, provided that such exercise price shall be rounded to cause such registration statement to remain effective until the exercise or expiration nearest cent. Notwithstanding clauses (iii) and (i v) of the Parent Exchange Optionspreceding sentence, each FBKP Option which is an "incentive stock option" shall be adjusted as required by Section 424 of the IRC, and the regulations promulgated thereunder, so as not to constitute a modification, extension or renewal of the option within the meaning of Section 424(h) of the IRC. For purposes PSB and FBKP agree to take all necessary steps to effect the foregoing provisions of this Section 2.4(a1.02(f), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At or prior to the Effective TimeDate, each Palatin and MBI shall take all action necessary to cause the assumption by Palatin as of the Effective Date of all outstanding unexpired and unexercised option options as of the Effective Date (the "Outstanding Options") to purchase or acquire a share of Company MBI Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableStock, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Timeunvested, each Company issued under MBI's Pre-1984 Stock Option Plan, 1984 Stock Option Plan, 1993 Stock Option Plan, , 1993 Outside Director's Stock Option Plan, 1997 Outside Directors Stock Option Plan and 1998 Stock Option Plan (the "MBI Stock Option Plans") or pursuant to separate option agreements, all of which are listed in Section 3.5 of the MBI Disclosure Schedule (as defined below). Each of the Outstanding Options shall be converted without any action on the part of the holder thereof into an option to purchase shares of Palatin Common Stock as of the Effective Date. The number of shares of Palatin Common Stock that the holder of an assumed Outstanding Option shall be entitled to receive upon the exercise of such option shall be a number of whole and fractional shares determined by multiplying the number of shares of Parent MBI Common Stock equal subject to such option, determined immediately before the product Effective Date, by the Exchange Ratio. The exercise price of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number each share of shares of Company Palatin Common Stock which could have been obtained prior subject to an assumed Outstanding Option shall be the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share amount (rounded up to the nearest whole cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided obtained by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and dividing the exercise price per share of MBI Common Stock at which such Parent option is exercisable immediately before the Effective Date by the Exchange Option Ratio. Except as specified in Section 3.5 of the MBI Disclosure Schedule, the assumption and substitution of options as provided in this Section shall not give the holders of such options additional benefits or additional vesting rights which they did not have immediately prior to the Effective Date or relieve the holders of any obligations or restrictions applicable to their options or the shares obtainable upon exercise of the options. Only whole shares of Palatin Common Stock shall be determined issued upon exercise of any Outstanding Option, and in a manner which would not result lieu of receiving any fractional share of Palatin Common Stock, the holder of such option shall receive in cash the conversion of Company Stock Options into Parent Exchange Options being treated Prior Day Market Price (as a new grant of stock options under Section 409A defined below) of the Codefractional share, net of the applicable exercise price of the fractional share and applicable withholding taxes. After the Effective Date, the MBI Stock Option Plans and any Outstanding Options issued outside the scope of the MBI Stock Option Plans shall be continued in effect by the Surviving Corporation subject to amendment, modification, suspension, abandonment or termination as provided therein, and the Company and Parent Stock Option Plans as so continued (i) shall agree upon any adjustments relate solely to Outstanding Options, (ii) thereafter shall relate only to the issuance of Palatin Common Stock as provided in this Section 2.4(aand (iii) necessary shall continue to avoid provide for equitable adjustment in the terms of Outstanding Options in the event of certain corporate events which alter the capital structure of the Surviving Corporation. For purposes of this Agreement, the term "Prior Day Market Price" with respect to shares of either Palatin Common Stock or MBI Common Stock, as applicable, shall mean the last reported sale price or, if not so reported, the average of the high bid and low asked prices in the over-the-counter market, as reported by the applicable exchange or automated quotation system on which such new grant of stock optionstrades for the day immediately preceding the day for which the Prior Day Market Price is being determined.

Stock Options. (a) At the Effective Time, each KNBT Stock Option which is outstanding unexpired and unexercised option immediately prior to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableEffective Time, whether or not then vested or subject and exercisable, shall cease to any performance condition that has not been satisfied. At the Effective Time, each Company represent a right to acquire shares of KNBT Common Stock Option and shall be converted automatically into an option to purchase the number of shares of Parent NPB Common Stock, and NPB shall assume each KNBT Stock equal to Option, in accordance with the product terms of the applicable KNBT Stock Plan and stock option or other agreement by which it is evidenced, except that from and after the Effective Time, (xi) NPB and the Human Resources Committee of the NPB Board shall be substituted for KNBT and the committee of the KNBT Board (including, if applicable, the entire KNBT Board) administering such KNBT Stock Option Conversion Fraction Plan, (as defined in this Section 2.4(a)ii) multiplied each KNBT Stock Option assumed by NPB may be exercised solely for shares of NPB Common Stock, (yiii) the number of shares of Company NPB Common Stock which could have been obtained subject to such KNBT Stock Option shall be equal to the number of shares of KNBT Common Stock subject to such KNBT Stock Option immediately prior to the Effective Time upon multiplied by the exercise Exchange Ratio, provided that any fractional shares of each NPB Common Stock resulting from such Company Stock Option (multiplication shall be rounded down to the nearest whole share), at an (iv) the per share exercise price under each such KNBT Stock Option shall be adjusted by dividing the per share (exercise price under each such KNBT Stock Option by the Exchange Ratio, provided that such exercise price shall be rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and (v) all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock outstanding KNBT Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as become fully vested and exercisable. Each Company exercisable at the Effective Time notwithstanding anything to the contrary in the applicable KNBT Stock Plan or stock option or other agreement by which a KNBT Stock Option converted pursuant to is evidenced. Notwithstanding clauses (iii) and (iv) of the terms of this Section 2.4(a) preceding sentence, each KNBT Stock Option which is an “incentive stock option” shall be referred to adjusted as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption required by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options Sections 409A and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A 424 of the Code, and the Company regulations promulgated thereunder, so as not to constitute a modification, extension or renewal of the option within the meaning of Sections 409A and Parent shall 424(h) of the Code. NPB and KNBT agree upon any adjustments to take all necessary steps to effect the foregoing provisions of this Section 2.4(a) 2.05 (a), including in the case of NPB taking all corporate action necessary to avoid such new grant reserve for issuance a sufficient number of stock optionsshares of NPB Common Stock for delivery upon exercise of the options to issue shares of NPB Common Stock issued in accordance herewith.

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans Shares (each, a “"COMPANY STOCK OPTION") under Company Stock Option”) shall vest and become fully exercisableOption Plans or under any agreement which Company disclosed in Section 2.3 of the Company Disclosure Schedule, whether or not then vested or vested, shall by virtue of the Merger be assumed by Parent. Each Company Stock Option so assumed by Parent under this Agreement will continue to have, and be subject to, the same terms and conditions of such options immediately prior to any performance condition that has not been satisfied. At the Effective TimeTime (including, without limitation, any repurchase rights or vesting provisions and provisions regarding the acceleration of vesting on certain transactions), except that: (i) each Company Stock Option shall will be converted into an option to purchase the solely exercisable (or will become exercisable in accordance with its terms) for that number of whole shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares Company Shares that were issuable upon exercise of such Company Common Stock which could have been obtained Option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option Exchange Ratio (as defined below), rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after and (ii) the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to per share exercise price for the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause issuable upon exercise of such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “assumed Company Stock Option Conversion Fraction” shall mean will be equal to the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and quotient determined by dividing the exercise price per share Company Share at which such Company Stock Option was exercisable immediately prior to the Effective Time by the Option Exchange Ratio, rounded up to the nearest whole cent. Parent shall comply with the terms of all such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange and use its best efforts to ensure, to the extent required by, and subject to the provisions of, Company Option Plans and permitted under the Code or other relevant laws and regulations that any Company Stock Options being treated as a new grant of stock options that qualified for tax treatment under Section 409A 422 of the CodeCode prior to the Effective Time and that any Company Stock Options that qualified for tax treatment under Section 102 of the Ordinance prior to the Effective Time continue to so qualify, with the same rights, after the Effective Time. Parent shall take all corporate actions necessary to reserve for issuance a sufficient number of shares of Parent Common Stock for delivery upon exercise of all Company Stock Options pursuant to the terms set forth in this Section 5.11(a). Prior to the Effective Time, the Company shall take all actions necessary to effect the transactions contemplated by this Section 5.11(a); provided, however, Company shall not be required to obtain consents from optionees with respect to the option assumption formula set forth herein: The "OPTION EXCHANGE RATIO" shall be equal to the greater of (i) the quotient obtained by dividing the Per Share Cash Consideration by the average closing sale price of one share of Parent Common Stock as reported on Nasdaq for the five (5) consecutive trading days ending immediately prior to the Effective Time and (ii) the sum of (A) 0.2365, and (B) the Company and quotient obtained by dividing $12.375 by the average closing sale price of one share of Parent shall agree upon any adjustments Common Stock as reported on Nasdaq for the five (5) consecutive trading days ending immediately prior to this Section 2.4(a) necessary to avoid such new grant of stock optionsthe Effective Time.

Stock Options. At the Effective TimeFor purposes of this Agreement, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock "CBI Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into " means an option to purchase CBI common shares pursuant to a CBI LTIP and "Convergys Option" means an option to purchase Convergys common shares pursuant to the Convergys LTIP. At the time of the Distribution, each holder of a CBI Option shall receive a Convergys Option to purchase a number of Convergys common shares equal to the number of CBI common shares of Parent Common Stock equal subject to the product CBI Option. Each Convergys Option shall have the same terms and conditions (including vesting) as the CBI Option with respect to which it is granted, except that termination of employment shall mean (xi) in the Stock case of a CBI employee or director, termination of employment with CBI and (ii) in the case of a Convergys employee or director, termination of employment with Convergys. Each CBI Option Conversion Fraction (as defined shall be amended to provide that, in this Section 2.4(a)) multiplied by (y) the number case of shares a Convergys employee or director, termination of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise employment shall mean termination of each such Company Stock Option (rounded down to the nearest whole share), at an employment with Convergys. The exercise price per share of each CBI Option (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a"CBI Exercise Price") shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Optionsreduced, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange the associated Convergys Option (the "Convergys Exercise Price") shall be determined in a manner which would not result set so that (i) the sum of the CBI Exercise Price (after the reduction provided herein) and the Convergys Exercise Price is equal to the CBI Exercise Price (before the reduction provided herein) and (ii) the ratio of the CBI Exercise Price (after the reduction provided herein) to the Convergys Exercise Price is equal to the ratio of the average of the daily high and low per-share prices of CBI common shares on the New York Stock Exchange ("NYSE") during each of the five trading days starting on the ex-dividend date for the Distribution to the average of the daily high and low per-share prices of Convergys common shares on the NYSE during each of the five trading days starting on the ex-dividend date for the Distribution. Notwithstanding the foregoing, in the conversion event that the number of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A Convergys common shares to be distributed to each CBI shareholder at the time of the CodeDistribution with respect to each CBI common share owned by the shareholder on the record date for the Distribution is greater or less than one, the number of Convergys common shares represented by each Convergys Option and the Company and Parent Convergys Exercise Price shall agree upon any adjustments be adjusted to this Section 2.4(a) necessary to avoid reflect such new grant of stock optionsdifference.

Stock Options. (a) At the Effective Time, each outstanding unexpired and unexercised stock option that is then outstanding, whether vested or unvested (a "Company Option"), shall be assumed by Parent in accordance with the terms (as in effect as of the Effective Time) of the Company's 1996 Stock Option Plan, the stock option agreement and/or warrant agreement by which such Company Option is evidenced. All rights with respect to purchase or acquire a share of Company Common Stock under the outstanding Company Equity Plans (eachOptions shall thereupon be converted into rights with respect to Parent Common Stock. Accordingly, a “Company Stock Option”) shall vest from and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At after the Effective Time, (a) each Company Stock Option shall assumed by Parent may be converted into an option to purchase exercised solely for shares of Parent Common Stock, (b) the number of shares of Parent Common Stock subject to each such assumed Company Option shall be equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained that were subject to such Company Option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option (Exchange Ratio, rounded down to the nearest whole share)number of shares of Parent Common Stock, at an (c) the per share exercise price for the Parent Common Stock issuable upon exercise of each such assumed Company Option shall be determined by dividing the exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a such Company Stock Option divided Option, as in effect immediately prior to the Effective Time, by the Stock Option Conversion FractionExchange Ratio, and all references rounding the resulting exercise price up to the Company in nearest whole cent, and (d) all restrictions on the exercise of each such option assumed Company Option shall be deemed to refer to Parentcontinue in full force and effect, where appropriate. The and the term, exercisability, vesting schedule and other terms provisions of such Company Stock Options Option shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, otherwise remain unchanged; provided, however, that each such assumed Company Option shall, in accordance with its terms, be subject to further adjustment as appropriate to reflect any Recapitalization Event after the Effective Time. The Company and Parent shall treat each Company take all action that may be necessary (under the Company's 1996 Stock Option as fully vested Plan and exercisable. Each Company Stock Option converted pursuant otherwise) to effectuate the terms provisions of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with 1.6. Following the issuance of Parent Exchange OptionsClosing, Parent shall reserve for issuance will send to each holder of an assumed Company Option a written notice setting forth (i) the number of shares of Parent Common Stock that will become subject to such assumed Company Option, and (ii) the exercise price per share of Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder Common Stock issuable upon exercise of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parentsuch assumed Company Option. Parent shall file with the SEC, within thirty (30) days after the Closing Date, a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the registering shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until issuable upon the exercise or expiration of the Company Options assumed by Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments pursuant to this Section 2.4(a) necessary to avoid 1.6, provided such new grant of stock optionsCompany Options are registrable on Form S-8.

Stock Options. (a) At the Effective Time, (x) each Company Option that is outstanding unexpired and unexercised immediately prior to the Effective Time, whether or not vested, shall be converted into and become an option to purchase or acquire Parent Common Stock, and Parent shall assume such Company Option in accordance with the terms (as in effect as of the date of this Agreement) of the applicable Company Option Plan and the terms of the stock option agreement by which such Company Option is evidenced; and (y) each share of Parent Common Stock into which a share of Company Restricted Stock was converted pursuant to Section 1.5 shall be a share of Parent Restricted Stock and shall remain subject to the same terms and conditions as were applicable under the award of Company Restricted Stock immediately prior to the Effective Time. All rights with respect to Company Common Stock under the Company Equity Plans (eachOptions assumed by Parent shall thereupon be converted into options with respect to Parent Common Stock. Accordingly, a “Company Stock Option”) shall vest from and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At after the Effective Time, : (A) each Company Stock Option shall assumed by Parent may be converted into an option to purchase exercised solely for shares of Parent Common Stock; (B) the number of shares of Parent Common Stock equal subject to the product of (x) the Stock each Company Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied assumed by (y) Parent shall be determined by multiplying the number of shares of Company Common Stock which could have been obtained that were subject to such Company Option immediately prior to the Effective Time upon by the exercise of each such Company Stock Option (rounded Exchange Ratio, and rounding the resulting number down to the nearest whole share), at an exercise price number of shares of Parent Common Stock; (C) the per share (rounded up to the nearest cent) equal to the exercise price for the Parent Common Stock issuable upon exercise of each such Company Option assumed by Parent shall be determined by dividing the per share exercise price of Company Common Stock subject to a such Company Stock Option divided Option, as in effect immediately prior to the Effective Time, by the Stock Option Conversion FractionExchange Ratio, and all references rounding the resulting exercise price up to the nearest whole cent; and (D) any restriction on the exercise of any Company Option assumed by Parent shall continue in each such option shall be deemed to refer to Parentfull force and effect and the term, where appropriate. The exercisability, vesting schedule and other terms provisions of such Company Stock Options Option shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, remain unchanged; provided, however, that Parent Board or a committee thereof shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant succeed to the terms authority and responsibility of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (Company Board or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date committee thereof with respect to the shares of Parent Common each Company Option, Company Restricted Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsassumed by Parent.

Stock Options. (i) At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock Option under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisablePlans, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Timeunvested, each Company Stock Option shall be converted into deemed to constitute an option to purchase acquire (a "New Parent Option"), on the same terms and conditions as were applicable under such Company Option, the number of shares of Parent Common Stock of Parent (rounded to the nearest whole number) equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yA) the number of shares Shares issuable upon exercise of such Company Option and (B) the Price Per Share divided by the average of the closing sales prices of Common Stock which could have been obtained of Parent on the New York Stock Exchange for the ten (10) consecutive days immediately prior to and including the day preceding the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share)Time, at an exercise price per share (rounded up to the nearest whole cent) equal to (x) the aggregate exercise price for each the Shares otherwise purchasable pursuant to such share of Company Common Stock subject to a Company Stock Option divided by (y) the aggregate number of shares of Common Stock Option Conversion Fraction, and all references of Parent purchasable pursuant to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, New Parent Option (as calculated immediately above); provided, however, that Parent shall treat each in the case of any Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to which Section 422 of the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with Code applies, the issuance of Parent Exchange Optionsoption price, Parent shall reserve for issuance the number of shares purchasable pursuant to such option and the terms and conditions of Parent Common Stock that will become exercise of such option shall be determined in accordance with the foregoing, subject to such adjustments as are necessary in order to satisfy the requirements of Section 424(a) of the Code. At or prior to the Effective Time, the Company shall take all necessary actions to permit the assumption of the unexercised Company Options by Parent Exchange Options pursuant to this Section 2.4(a)and shall take all action necessary to cause the funds held in the Company's Employee Stock Purchase Plan to be used to purchase outstanding Shares through open market transactions so that such Shares will be converted into the right to receive cash in the Merger; provided that thereafter the Company shall terminate the Company's Employee Stock Purchase Plan. As promptly as reasonably practicable after -40- 44 (ii) Effective at the Effective Time, Parent shall issue to assume, as a New Parent Option, each holder outstanding Company Option in accordance with this Section and with the terms of an outstanding Parent Exchange Option a document evidencing the foregoing assumption Stock Plan under which it was issued and the stock option agreement by Parentwhich it is evidenced. Not later than thirty calendar days after the Closing Date, Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act of 1933 on the Closing Date with respect to the Form S-8, or other appropriate form, covering shares of Parent Common Stock subject to such New Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At (i) On the Effective TimeDate, each outstanding unexpired Heritage Option and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableeach BCB Option which is then outstanding, whether or not then vested exercisable, shall cease to represent a right to acquire shares of Heritage Common Stock or subject to any performance condition that has not been satisfied. At BCB Common Stock, as the Effective Timecase may be, each Company Stock Option and shall be converted automatically into an option to purchase the number of shares of Parent Holding Company Common Stock, and the Holding Company shall assume each Heritage Option and BCB Option, in accordance with the terms of the applicable Heritage Stock equal to Option Plan or BCB Stock Option Plan, as the product of case may be, and the stock option agreement by which it is evidenced, except that from and after the Effective Date, (xi) the Holding Company and its Board of Directors or a duly authorized committee thereof shall be substituted for Heritage, BCB or their respective Boards of Directors or duly authorized committee thereof administering such Heritage Stock Option Conversion Fraction Plan or BCB Stock Option Plan, as the case may be, (as defined in this Section 2.4(a)ii) multiplied each Heritage Option and BCB Option assumed by the Holding Company may be exercised solely for shares of the Holding Company Common Stock, (yiii) the number of shares of Holding Company Common Stock which could have been obtained subject to each BCB Option shall be equal to the number of shares of BCB Common Stock subject to such BCB Option immediately prior to the Effective Time upon Date multiplied by the exercise BCB Exchange Ratio, provided that any fractional shares of each Holding Company Common Stock resulting from such Company Stock Option (multiplication shall be rounded down to the nearest whole share), at an and (iv) the per share exercise price under each such BCB Option shall be adjusted by dividing the per share (exercise price under each such BCB Option by the BCB Exchange Ratio, provided that such exercise price shall be rounded up to the nearest cent, (v) equal to the exercise price for each such share number of shares of Holding Company Common Stock subject to a Company Stock each Heritage Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed equal to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Heritage Common Stock subject to Parent such Heritage Option immediately prior to the Effective Date multiplied by the Heritage Exchange Options Ratio, provided that any fractional shares of Holding Company Common Stock resulting from such multiplication shall be rounded down to the nearest share, and (vi) the per share exercise price under each such Heritage Option shall use its commercially reasonable efforts be adjusted by dividing the per share exercise price under each such Heritage Option by the Heritage Exchange Ratio, provided that such exercise price shall be rounded up to cause such registration statement to remain effective until the exercise or expiration nearest cent. Notwithstanding clauses (iii), (iv), (v) and (vi) of the Parent Exchange Optionspreceding sentence, each BCB Option or Heritage Option which is an "incentive stock option" shall be adjusted as required by Section 424 of the IRC, and the regulations promulgated thereunder, so as not to constitute a modification, extension or renewal of the option within the meaning of Section 424(h) of the IRC. For purposes BCB and Heritage agree to take all necessary steps to effect the foregoing provisions of this Section 2.4(a1.02(f), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. (a) At the Effective Time, each outstanding unexpired the Acquiror will assume the Company's 1995 Stock Option Plan (the "Option Plan") and unexercised all of the Company's obligations thereunder and may, at its election, provide for the merger of the Company's option to purchase or acquire a share plans into those of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfiedAcquiror. At the Effective Time, each Company Stock the Option Plan shall be converted into amended to provide that each outstanding option issued pursuant to the Option Plan shall become an option to purchase acquire, on the same terms and conditions as were applicable under such option (including, without limitation, the time periods allowed for exercise), a number of shares of Parent Acquiror Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) Exchange Ratio and the number of shares of Company Common Stock which could have been obtained prior subject to the Effective Time upon the exercise such option (provided that any fractional shares of each Acquiror Common Stock resulting from such Company Stock Option (multiplication shall be rounded down up to the nearest whole share), at an exercise a price per share (rounded up down to the nearest cent) equal to the exercise price for each such per share of the shares of Company Common Stock subject to a Company Stock Option such option divided by the Stock Exchange Ratio on the same terms and conditions as were applicable under such option (including without limitation, the time periods allowed for exercise). Immediately prior to the Effective Time, the Company may issue remaining unissued options under the Option Conversion FractionPlan, to result in a total of 62,500 granted options, and may also amend the Option Plan or adopt a further option plan to permit issuance of up to an additional 1, 350 option grants. The Company shall also amend the Option Plan to (i) modify the Option Plan by eliminating any existing provisions providing for an adjustment in option shares in the event of payment of a cash dividend (in connection with which amendment the Company shall utilize its best efforts to have option grantees enter into replacement option agreements which eliminate any claim or right to such adjustment), (ii) eliminate any right of option grantees to put granted options to the Company, and (iii) include such further amendments an may be reasonably requested by Acquiror. Notwithstanding the foregoing, with respect to options that are incentive stock options, the excess of the aggregate fair market value of the shares subject to the option immediately after the substitution over the aggregate option price of such shares shall not be more than the excess of the aggregate fair market value of all shares subject to the option immediately before the substitution over the aggregate option price of such shares. The duration and other terms of the option shall remain the same, except that all references to the Company in each such option shall refer to the Acquiror. All options granted under the Option Plans shall be deemed to refer to Parent, where appropriatefully vested as of the day preceding the Effective Time. The other terms of such Company Stock Options shall continue Acquiror agrees to apply in accordance with their terms, including pursuant take all corporate action necessary to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the a sufficient number of shares of Parent Acquiror Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder for delivery upon exercise of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) options under the Securities Act on Option Plans assumed by the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment Acquiror in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsAgreement.

Stock Options. At (a) Each grantee under any of the Effective TimeMII Legacy Equity Plans (i) who is a B&W Legacy Award Holder or will be a B&W Employee, or who will not be a B&W Employee but will serve on the board of directors of B&W and not on the board of directors of MII immediately after the Distribution Date, and (ii) who holds as of the Distribution Date, one or more MII Options, shall receive, as a replacement award in substitution for each outstanding unexpired and unexercised such MII Option (which shall be cancelled), an option to purchase or acquire a share number of Company shares of B&W Common Stock under the Company B&W New Equity Plans Plan (each, a “Company Stock Replacement B&W Option”) shall vest and become fully exercisable, whether or not then vested or having a value (calculated using the Post-Distribution B&W Share Price) equal to the value of the MII Common Stock subject to any performance condition that has not been satisfiedthe MII Option (calculated using the Pre-Distribution MII Share Price), as calculated pursuant to the following provisions. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the The number of shares of Parent B&W Common Stock subject to a Replacement B&W Option shall be equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yi) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company MII Common Stock subject to an MII Option as of the Distribution Date and (ii) a Company Stock fraction, the numerator of which is the Pre-Distribution MII Share Price and the denominator of which is the Post-Distribution B&W Share Price. Each such Replacement B&W Option divided by shall have the Stock Option Conversion Fraction, and all references same comparative ratio of the exercise price to the Company in Post-Distribution B&W Share Price as the exercise price of each such option MII Option to the Pre-Distribution MII Share Price. B&W shall be deemed to refer to Parent, where appropriate. The other terms responsible for (i) the satisfaction of such Company Stock all tax reporting and withholding requirements in respect of the exercise of Replacement B&W Options shall continue to apply issued in accordance with their termsthis Section 3.4(a) and (ii) remitting the appropriate tax or withholding amounts to the appropriate taxing authorities. Replacement B&W Options shall not be exercisable until the Registration Statement Effectiveness Date. Except as provided in the foregoing provisions of this Section 3.4(a), Replacement B&W Options granted under this Section 3.4(a) shall be granted on terms which are in all material respects identical (including pursuant with respect to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant vesting) to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange MII Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsthey replace.

Stock Options. At Company will, promptly on or after the date of this Agreement, take all such actions as it is permitted or required to take under the terms of its stock option plans to cancel, after the Offer Completion (as defined in Section 6.5(a)) and prior to the Effective Time, each all outstanding unexpired options (collectively, the "STOCK OPTIONS" and unexercised option individually, a "STOCK OPTION") to purchase or acquire a share shares of Company Common Stock heretofore granted under any such employee or nonemployee director stock option plan with Company and to pay, promptly, and in any event within five days, after the Company Equity Plans Offer Completion, in cancellation of each such Stock Option (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company such Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock is then exercisable) a cash amount equal to the product amount, if any, by which the Merger Consideration exceeds the per share exercise price of (x) the such Stock Option Conversion Fraction (as defined in this Section 2.4(a)) Option, multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior then subject to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share"STOCK OPTION SETTLEMENT AMOUNT"), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock but subject to all required tax withholdings by Company. Each holder of a Company then outstanding Stock Option divided by the Stock Option Conversion Fraction, and all references that Company does not have a right to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted cancel pursuant to the terms of this Section 2.4(athe applicable stock option plan, upon execution of a cancellation agreement (a "STOCK OPTION CANCELLATION AGREEMENT") shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange OptionsCompany, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and which Company shall use its commercially reasonable efforts to cause obtain from each such registration statement holder prior to remain effective until or promptly after the exercise Offer Completion, shall have the right to receive in cancellation of such Stock Option (whether or expiration not such Stock Option is then exercisable) a cash payment from Company promptly and in any event within five days after the later of the Parent Exchange OptionsOffer Completion or the execution of a Stock Option Cancellation Agreement, in an amount equal to the Stock Option Settlement Amount, without interest, but subject to all required tax withholdings by Company. For Each Stock Option that is subject to a Stock Option Cancellation Agreement shall be canceled upon payment of the Stock Option Settlement Amount for such Option. The Company Board or the Committee appointed pursuant to Section 2 of the Funco, Inc. 1993 Stock Option Plan Amended and Restated Through July 31, 1998 has determined that a Potential Change in Control (as defined in said Stock Option Plan) has occurred for purposes of this Section 2.4(a), determining the “Change in Control Price (as defined in said Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(dPlan). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At Subject to and conditioned upon the Effective TimeExecutive’s delivering to the Company the Release provided for in Section 16 with all periods for revocation expired and notwithstanding any provision in the Incentive Compensation Plan, each outstanding unexpired the 1998 Option Plan, other relevant plan or program or this Section 6, all stock options granted to the Executive by the Company which have not otherwise vested shall vest immediately upon a Termination that occurs upon the date of the Change in Control or thereafter on or before the second anniversary of the Change in Control and unexercised such vested stock options shall remain exercisable for a period of ninety (90) days following the Termination Date (or such longer period as may be set forth in the applicable stock option to purchase plan or acquire award agreement), but not later than the expiration of the stated option term; provided, however, such stock options shall vest immediately upon the consummation of a share of Company Common Stock Change in Control if the successor entity has not either assumed (expressly or impliedly) the Company’s obligations under the Company Equity Plans (eachapplicable option award or plan document or issued to the Executive a substitute stock option award of equivalent value on no less favorable terms for vesting or payment as provided under the stock option award so replaced; provided further that, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At Section 6(d), within five (5) days after all periods for revocation have expired in the Effective TimeRelease provided for in Section 16, each the Company Stock Option shall be converted into may, at its election, pay to the Executive in cash an option to purchase the number of shares of Parent Common Stock amount equal to the product aggregate of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) difference between the number exercise price of shares of Company Common Stock which could have been obtained each stock option granted to the Executive prior to the Effective Time upon consummation of the exercise Change in Control that remains outstanding and unexercised at the time of each such Company Termination, and the fair market value (computed as the average of the high and low trades reported on the New York Stock Option (rounded down to Exchange) of the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fractionoption, and all references to determined as of the Company in each such option Termination Date. Such cash payment shall be deemed to refer be in lieu of and in substitution for any right the Executive may have to Parent, where appropriate. The other terms of exercise such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to stock option or a related stock appreciation right under the terms of this Section 2.4(a) shall be referred the relevant stock option plan describing such rights, and the Executive agrees to as a “Parent Exchange Option.” In connection with surrender all stock options and related stock appreciation rights being cashed out hereunder prior to receiving the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Optionscash payment described above. For purposes of this Section 2.4(a)hereunder, the term “Stock Option Conversion Fractionstock option” shall mean the Exchange Ratio subject should be read to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would include all other similar equity instruments, including, but not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of limited to, stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsappreciation rights.

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company Common Stock under the Company Equity Plans (each, a “"COMPANY STOCK OPTION") under the Company Stock Option”) shall vest and become fully exercisableOption Plans, whether or not then vested vested, shall by virtue of the Merger and without any action on the part of -49- 55 Company, Parent or any holder of Company Stock Option, be assumed by Parent. Each Company Stock Option so assumed by Parent under this Agreement will continue to have, and be subject to, the same terms and conditions of such Company Stock Option immediately prior to any performance condition that has not been satisfied. At the Effective TimeTime (including, without limitation, any repurchase rights or vesting provisions and provisions regarding the acceleration of vesting on certain transactions, other than the transactions contemplated by this Agreement, except to the extent otherwise provided for in any plan or agreement applicable to such Company Stock Options and disclosed on Section 2.03 or 2.18 of the Company Schedule), except that (i) each Company Stock Option shall will be converted into an option to purchase the exercisable (or will become exercisable in accordance with its terms) for that number of whole shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained that were issuable upon exercise of such Company Stock Option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option (Exchange Ratio, rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after and (ii) the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to per share exercise price for the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause issuable upon exercise of such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “assumed Company Stock Option Conversion Fraction” shall mean will be equal to the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and quotient determined by dividing the exercise price per share of Company Common Stock at which such Company Stock Option was exercisable immediately prior to the Effective Time by the Exchange Ratio, rounded up to the nearest whole cent. Parent Exchange Option shall be determined in a manner which would not result in comply with the conversion terms of all such Company Stock Options. It is intended that Company Stock Options into assumed by Parent Exchange Options being treated shall qualify following the Effective Time as a new grant of incentive stock options under as defined in Section 409A 422 of the Code to the extent such Company Stock Options qualified as incentive stock options immediately prior to the Effective Time and the provisions of this Section 5.11 shall be applied consistent with such intent in accordance with Section 424 of the Code, and the Company and . Parent shall agree take all corporate actions necessary to reserve for issuance a sufficient number of shares of Parent Common Stock for delivery upon any adjustments to exercise of assumed Company Stock Options on the terms set forth in this Section 2.4(a) necessary to avoid such new grant of stock options5.11(a).

Stock Options. At Effective as of the Effective TimeDistribution Date, each Tenneco shall cause all outstanding unexpired and unexercised option options to purchase or acquire a share of Company Tenneco Common Stock under held by employees and officers other than (i) Active Employees and Former Employees of Automotive Group, (ii) employees of Packaging Corporation of America and (iii) employees of the Company Equity Plans folding carton division (eachor persons who have succeeded to the rights of any persons described in (i), a “Company Stock Option”(ii) shall vest and become fully exercisable, whether or not then vested or subject (iii) with respect to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option options to purchase the number of shares of Parent Tenneco Common Stock equal Stock) to be replaced by options to purchase Packaging Common Stock. Subject to the product requirements of (x) applicable law and generally accepted accounting principles, the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share)number, at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option replacement options shall be determined in a manner which would consistent with that described in Exhibit A attached hereto. Options to purchase Tenneco Common Stock held by persons described in clause (ii) or (iii) above, not result exercised prior to the Distribution Date shall be canceled effective as of the Distribution Date. Options held by Active Employees and Former Employees of Automotive Group (or persons who have succeeded to the rights of such persons) shall, unless exercised prior to the Distribution Date, remain outstanding as adjusted as provided herein after the Distribution Date, subject to the requirements of applicable law and generally accepted accounting principles. The parties recognize that in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of some jurisdictions, Automotive Group employees were granted rights other than stock options under Section 409A in lieu of the CodeSpecial Stock Option Award of 100 options per grantee, and in those jurisdictions, the outstanding rights will be adjusted comparably. The Automotive Company options and Parent rights shall agree upon any adjustments have the same terms and conditions as prior to this Section 2.4(a) necessary the Distribution Date except that the number of options and the option exercise price shall be adjusted as described in Exhibit A attached hereto. To the extent that the exercisability of options to avoid such new purchase Tenneco Common Stock currently is subject to the attainment of share price hurdles, those hurdles will also be adjusted with respect to both options to purchase Packaging Common Stock and Tenneco Common Stock. Tenneco may grant of stock optionsspecial pre-Distribution Date exercisability with respect to some or all options which are not otherwise exercisable.

Stock Options. At (a) Immediately prior to the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company IRT Common Stock (an "IRT Option") granted under any IRT Plan (as defined below) (other than any "Stock Purchase Plan" within the Company Equity Plans (eachmeaning of Section 423 of the Code), a “Company Stock Option”) shall vest and become fully exercisableshall, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Timeexercisable, each Company Stock Option shall be converted into become and represent an option to purchase the number of shares of Parent Company Common Stock equal (an "Assumed Option") rounded up to the product of nearest whole share, determined by multiplying: (x) the number of shares of IRT Common Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied subject to such option immediately prior to the Effective Time by (y) the Exchange Ratio, at an exercise price per share of Company Common Stock (increased to the nearest whole cent) equal to the exercise price per share of IRT Common Stock immediately prior to the Effective Time divided by the Exchange Ratio; provided, however, that in the case of any IRT Option to which Section 421 of the Code applies by reason of its qualification as an incentive stock option under Section 422 of the Code, the conversion formula shall be adjusted if necessary to comply with Section 424(a) of the Code. After the Effective Time, each Assumed Option shall vest only to the extent required by the terms of the underlying IRT Option. If no automatic vesting requirement is set forth in the underlying IRT Option or other agreement, then the Assumed Option shall be subject to the same vesting schedule and be exercisable upon the same terms and conditions as were applicable to the related option immediately prior to the Effective Time. As soon as reasonably practical, the Company shall register under the Securities Act on Form S-8 or another appropriate SEC form (and use its commercially reasonable efforts to maintain the effectiveness thereof and maintain the current status of the prospectuses contained therein) all shares of Company Common Stock issuable pursuant to all Assumed Options. At or prior to the Effective Time, the Company shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company delivery in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance Assumed Options. Schedule 2.8 of Parent Exchange Options, Parent shall reserve for issuance the number IRT Disclosure Memorandum contains a true and complete list of all IRT Options and shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder restricted capital stock of an IRT issued and outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to date of this Agreement and the vesting schedules and exercise prices of such IRT Options and shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsrestricted stock.

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans Shares (each, a “Company Stock MediVision Option”) shall vest and become fully exercisableunder the Option Plans (as defined in Section 5.01(b)(i)(A)), whether or not then vested exercisable and whether or subject to any performance condition that has not been satisfied. At the Effective Timevested, each Company Stock Option shall be assumed by OIS such that it is converted into an option (a “Replacement Option”) to purchase the a number of shares of Parent OIS Common Stock equal to the product number of (x) the Stock Shares underlying such MediVision Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share)Conversion Ratio, at an exercise price per share (rounded up to the nearest cent) of Common Stock equal to the exercise price for each per Share of such share of Company Common Stock subject MediVision Option as in effect immediately prior to a Company Stock Option the Closing divided by the Stock Option Conversion Fraction, Ratio and all references to the Company in each with such option shall be deemed to refer to Parent, where appropriate. The other terms of and conditions as were applicable to such Company Stock MediVision Option (including any repurchase rights or vesting provisions); provided, that OIS shall use its reasonable efforts to effect the conversion in such a manner that the Replacement Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, have the same tax attributes as the MediVision Options; provided, however, that Parent (i) the exercise price and the number of shares of OIS Common Stock purchasable pursuant to the Replacement Options shall treat each Company Stock Option be determined in a manner consistent with the requirements of Sections 409A, 422 and 424(a) of the Code, as fully vested applicable; (ii) for the purposes of converting option exercise prices, euros will be converted into U.S. dollars at the exchange rate prevailing at the close of business on the trading date prior to the date of this Agreement; and exercisable. Each Company Stock Option converted (iii) the Replacement Options will be issued pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange OIS Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange OptionsPlans. For purposes of this Section 2.4(a4.04(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option OIS shall be determined in a manner which would not result in considered to have used its "reasonable efforts" to effect the conversion of Company the MediVision Options so that the Replacement Options have the same tax attributes as the MediVision Options in the following circumstances: (i) if the Options Tax Ruling is not issued prior to the Effective Date, OIS issues “Nonqualified Stock Options into Parent Exchange Options being treated Options,” meaning options which do not qualify as a new grant of incentive stock options within the meaning of Section 422 of the Code (“ISOs”), for all of the Replacement Options; and (ii) if the Options Tax Ruling is issued prior to the Effective Date, (A) for the MediVision Options with favorable tax treatment under Israeli tax law as described in Section 409A 6.12(c)(i) (“Favorable MV Options”), OIS coordinates the issuance of such Replacement Options with the Options Tax Ruling so that ISOs may be issued to the extent such conversion is permitted and consistent with Sections 422 and 424(a) of the Code, and (B) for the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid non-Favorable MV Options, OIS issues Nonqualified Stock Options for such new grant of stock optionsReplacement Options.

Stock Options. Section 2.4.1 At the Effective Time, each outstanding all unexercised and unexpired and unexercised option options to purchase or acquire a share of Company Common Stock (“Company Options”) then outstanding, under any stock option plan of the Company Company, including the 1995 Nonstatutory Stock Option Plan, the 1995 Director Option Plan, the 1996 Nonstatutory Stock Option Plan and the 2006 Equity Plans Incentive Plan and any other plan, agreement or arrangement (each, a the “Company Stock OptionOption Plans”) shall vest and become fully exercisable), whether or not then vested or exercisable, will be assumed by Parent (each, an “Assumed Company Option”). Each Assumed Company Option so assumed by Parent under this Agreement will continue to have, and be subject to, the same terms and conditions as set forth in the Company Stock Option Plan applicable to such Assumed Company Option and any performance condition that has not been satisfied. At agreements thereunder immediately prior to the Effective Time, except that (A) each Assumed Company Stock Option shall will be converted into an option to purchase the exercisable (or will become exercisable in accordance with its terms) for that number of whole shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained that were issuable upon exercise of such Assumed Company Option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option (Exchange Ratio, rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after and (B) the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to per share exercise price for the shares of Parent Common Stock subject issuable upon exercise of such Assumed Company Option, will be equal to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and quotient determined by dividing the exercise price per share of Company Common Stock at which such Parent Assumed Company Option was exercisable immediately prior to the Effective Time by the Exchange Option Ratio, rounded up to the nearest whole cent. Continuous employment with the Company or its subsidiaries shall be determined in a manner which would not result in credited to the conversion optionee for purposes of determining the vesting of all Assumed Company Options after the Effective Time. Parent will assume the Company Stock Options into Option Plans at the Effective Time, provided, however, that following the Effective Time, Parent Exchange Options being treated as a new grant of stock options will issue awards, if any, only under Section 409A of the Code2006 Equity Incentive Plan. The 1995 Nonstatutory Stock Option Plan, the 1995 Director Option Plan and the 1996 Nonstatutory Stock Option Plan will be assumed pursuant to the preceding sentence solely for purposes of governing the Assumed Company and Parent shall agree upon any adjustments Options following the Effective Time that were previously issued pursuant to this Section 2.4(a) necessary to avoid the terms of such new grant of stock optionsplans.

Stock Options. (a) At the Effective Time, the Target Stock Option Plan and each outstanding unexpired Target Option, whether vested or unvested, shall be assumed by Acquiror, and unexercised Target's repurchase right with respect to any unvested option to purchase or acquire a share of Company Common Stock shares granted under the Company Equity Plans (eachTarget Stock Option Plan shall be assigned to Acquiror and Acquiror shall thereafter comply with the terms of the Target Stock Option Plan with respect to such assumed Target Options. On the Closing Date, a “Company Target shall deliver to Acquiror an updated Option Schedule current as of such date. Each Target Option so assumed by Acquiror under this Agreement shall continue to have, and be subject to, the same terms and conditions set forth in the Target Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject Option Plan immediately prior to any performance condition that has not been satisfied. At the Effective Time, each Company Stock except that (i) such Target Option shall be converted into an option to purchase the exercisable for that number of whole shares of Parent Acquiror Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Target Common Stock which could have been obtained that were issuable upon exercise of such Target Option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option Exchange Ratio (as defined below) and rounded down to the nearest whole share)number of shares of Acquiror Common Stock, at an (ii) the per share exercise price for the shares of Acquiror Common Stock issuable upon exercise of such Target Option shall be equal to the quotient determined by dividing the exercise price per share (of Target Common Stock at which such option was exercisable immediately prior to the Effective Time by the Option Exchange Ratio, rounded up down to the nearest whole cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms vesting of such Company Stock any unvested Target Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option will not accelerate as fully vested and exercisable. Each Company Stock Option converted pursuant to a result of the terms execution of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with Agreement or the issuance consummation of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a)transactions contemplated hereby. As promptly as reasonably practicable Within 45 business days after the Effective Time, Parent shall Acquiror will issue to each person who, immediately prior to the Effective Time was a holder of an outstanding Parent Exchange a Target Option a document evidencing the foregoing assumption of such Target Option by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect Acquiror, and within 45 business days after an adjustment to the shares of Parent Common Stock subject to Parent Option Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration Ratio as a result of the Parent provisions of Annex A hereto, Acquiror will issue to each such person a revised document reflecting the adjusted Option Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d)Ratio. The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options."

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share All options which may be exercised for issuance of Company Common Stock under the Company Equity Plans (whether or not vested) (each, a “Company Stock Option” and collectively the “Company Stock Options”) shall vest are described in the Company Disclosure Schedule and become fully exercisableare issued and outstanding pursuant to the Company’s Amended and Restated 1997 Stock Option Plan, whether or not then vested or subject 1999 Stock Option Plan and 2003 Stock Option Plan (each, a “Company Stock Option Plan” and collectively, the “Company Stock Option Plans”) and the agreements pursuant to any performance condition that has not which such Company Stock Options were granted (each, an “Option Grant Agreement”). True and complete copies of the Company Stock Option Plans and all Option Grant Agreements relating to outstanding Company Stock Options have been satisfieddelivered to Parent. At the Effective Time, each Company Stock Option that (i) is outstanding at the Effective Time, and (ii) would otherwise survive the Effective Time in the absence of the transactions contemplated by this Agreement (“Old Stock Options”), shall be converted into assumed by Parent through the grant of an option to purchase acquire shares of Parent Common Stock on the terms set forth below (each Old Stock Option, as assumed, a “Parent Stock Option”). All Old Stock Options shall automatically be converted as of the Effective Time, into Parent New Options which shall be identical to the Old Stock Options in all material respects, except that (i) upon exercise of the Parent Options, the optionholder will receive Parent Common Stock rather than Company Common Stock, (ii) the number of shares of Parent Common Stock covered by each Parent Option shall equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to covered by the Effective Time upon the exercise of each such Company corresponding Old Stock Option multiplied by the Exchange Ratio, (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest centiii) equal to the exercise price for of each such share of Company Common Stock subject Parent Option shall equal the exercise price applicable to a Company the corresponding Old Stock Option divided by the Stock Option Conversion Fraction, Exchange Ratio and all references to (iv) the Company in each committee that administers the plan by which such option Parent Options are governed shall be deemed to refer to a committee established by the Board of Directors of Parent. In all other material respects, where appropriate. The other the Parent Options shall be governed by the terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each the Company Stock Option as fully vested Plan at and exercisableafter the Effective Time. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable Promptly after the Effective Time, Parent shall use its reasonable best efforts to register the shares issuable upon exercise of the Parent Options under the Securities Act of 1933, and to keep such registration in effect until such time as all New Stock Options have been exercised. In connection with the foregoing, (i) the foregoing is intended to effect an assumption of the Old Stock Options by Parent under Section 424(a) of the Code and (ii) neither a Parent Stock Option nor the assumption of Old Stock Option shall give the holder of an Old Stock Option additional benefits which he did not have under such an Old Stock Option within the meaning of Section 424(a)(1) of the Code. Subject to issuance of the Parent Stock Options and the foregoing, the Company Stock Option Plans and all options or other rights to acquire Company Common Stock issued thereunder shall terminate at the Effective Time. Parent shall not issue or pay for any fractional shares otherwise issuable upon exercise of a Parent Stock Option. Prior to the Effective Time (to the extent required as determined by Parent or the Company under applicable law, the terms of the Company Stock Option Plans or otherwise), Parent shall receive agreements from each holder of an outstanding Parent Exchange Old Stock Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible does not elect to use) under the Securities Act on the Closing Date with respect exercise such Old Stock Option immediately prior to the shares Effective Time and have the Company Common Stock acquired as a result of such exercise converted into Parent Common Stock subject pursuant to Section 2.1 of this Agreement, pursuant to which each such holder agrees to accept a Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until Stock Option in substitution for the exercise or expiration Old Stock Option, as of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsEffective Time.

Stock Options. At The Founders shall use their best -------------- efforts to obtain from each Optionholder the Effective Timeconsent of such Optionholder to the transactions contemplated by the form of Option Amendment Agreement, which consent shall be evidenced by the execution and delivery by such Optionholder of a counterpart to an Option Amendment Agreement between ICI and such Optionholder. As soon as practicable following the date of this Agreement, the Founders shall use their best efforts to cause the Board of Directors of ICI (or, if appropriate, any committee administering the 1995 ICI Stock Option Plan or the 1996 ICI Stock Option Plan) to adopt such resolutions or take such other actions (i) as are required (A) to adjust the terms of all outstanding options to purchase shares of ICI Common Stock (and any stock appreciation rights linked to the price of shares of ICI Common Stock) heretofore granted to any employee (but not former employee) or director of ICI under the 1995 ICI Stock Option Plan or the 1996 ICI Stock Option Plan, whether vested or unvested, and (B) to adjust the terms of all outstanding options to purchase shares of ICI Common Stock (and any stock appreciation rights linked to the price of shares of ICI Common Stock) heretofore granted to any former employee of ICI under the 1995 ICI Stock Option Plan or the 1996 ICI Stock Option Plan that are vested as of the date on which the employment of such employee was terminated, in the case of clauses (A) and (B), as necessary to provide that each outstanding unexpired and unexercised such option to purchase or acquire a share shares of Company ICI Common Stock under (and any stock appreciation right related thereto) outstanding immediately prior to the Company Equity Plans effectiveness of the Merger shall not give the holder thereof the right to receive any capital stock of ICI or Holdings after the effective time of the Merger or to receive any consideration other than, for each option (eachand any stock appreciation right related thereto), a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock amount in cash equal to (i) the product excess, if any, of (x) the consideration paid in the Merger for each outstanding share of ICI Common Stock Option Conversion Fraction over (as defined in this Section 2.4(a)y) the exercise price per share of ICI Common Stock subject to such option multiplied by (yii) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company ICI Common Stock subject to a Company such option and (ii) as are required to make such other changes to the 1995 ICI Stock Option divided by Plan and the 1996 ICI Stock Option Conversion Fraction, Plan as IHS and all references the Founders may agree are appropriate to give effect to the Company in each such option shall be deemed to refer to Parent, where appropriatetransactions contemplated by this Agreement and the Ancillary Agreements. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and Founders shall use its commercially reasonable their best efforts to cause such registration statement ICI to remain effective until (i) cause the exercise or expiration 1995 ICI Stock Option Plan and the 1996 ICI Stock Option Plan to terminate upon consummation of the Parent Exchange Options. For purposes Merger, (ii) cause all provisions in any other ICI Benefit Plan providing for the issuance, transfer or grant of this Section 2.4(a)any capital stock of ICI, or any interest in respect of any capital stock of ICI, to be deleted upon consummation of the Merger and (iii) ensure that, upon consummation of the Merger, no holder of options to purchase shares of ICI Common Stock or participant in the 1995 ICI Stock Option Plan, the “1996 ICI Stock Option Conversion Fraction” Plan or any other ICI Benefit Plan shall mean the Exchange Ratio subject have any right to adjustment in accordance with Section 2.1(d). The number acquire any capital stock of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsICI or Holdings.

Stock Options. (a) At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire Company Shares (a share of Company Common Stock "COMPANY STOCK OPTION") granted under the Company's plans identified in the Schedule 1.4 as being the only compensation or benefit plans or agreements pursuant to which Company Equity Plans Shares may be issued (eachcollectively, a “Company Stock Option”) shall vest and become fully exercisablethe "COMPANY STOCK OPTION PLANS"), whether vested or not then vested or subject vested, shall be deemed assumed by Acquirer and shall thereafter be deemed to constitute an option to acquire, on the same terms and conditions (including any performance condition that has not been satisfied. At the Effective Time, each provisions for acceleration) as were applicable under such Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon (in accordance with the exercise past practice of each the Company with respect to interpretation and application of such Company Stock Option terms and conditions), the number (rounded down to the nearest whole share)number) of shares of Acquirer Common Stock determined by multiplying (x) the number of Company Shares subject to such Company Stock Option immediately prior to the Effective Time by (y) the Exchange Ratio, at an exercise a price per share of Acquirer Common Stock (rounded up to the nearest whole cent) equal to (A) the exercise price for each per Company Share otherwise purchasable pursuant to such share of Company Common Stock subject to a Company Stock Option divided by (B) the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriateExchange Ratio. The other terms parties intend that the conversion of such the Company Stock Options hereunder will meet the requirements of Section 424(a) of the Code and this Section 1.4(a) shall continue to apply in accordance be interpreted consistent with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisableintention. Each Company Stock Option converted pursuant Subject to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Company Stock Options and the documents governing such Company Stock Options, Parent shall reserve for issuance the number Merger will not terminate or accelerate any Company Stock Option or any right of shares of Parent exercise, vesting or repurchase relating thereto with respect to Acquirer Common Stock that acquired upon exercise of such assumed Company Stock Option. Holders of Company Stock Options will become subject not be entitled to Parent Exchange Options pursuant acquire Company Shares after the Merger. In addition, prior to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall the Company will make any amendments to the terms of such stock option or compensation plans or arrangements that are necessary to give effect to the transactions contemplated by this Section 1.4. Promptly following the Effective Time, Acquirer will issue to each holder of an outstanding Parent Exchange Company Stock Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Company Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsby Acquirer.

Stock Options. (i) At the Effective TimeDate, each Graystone Stock Option which is outstanding unexpired and unexercised option immediately prior to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableEffective Date, whether or not then vested or subject and exercisable, shall cease to any performance condition that has not been satisfied. At the Effective Time, each Company represent a right to acquire shares of Graystone Common Stock Option and shall be converted automatically into an option to purchase the number of shares of Parent Tower Common Stock, and Tower shall assume each Graystone Stock equal to Option, in accordance with the product terms of the applicable Graystone Stock-Based Plan or other agreement by which it is evidenced, except that from and after the Effective Date, (xi) Tower and a disinterested committee of the Tower board of directors shall be substituted for Graystone and the committee of the Graystone board of directors (including, if applicable, the entire Graystone board of directors) administering such Graystone Stock Plan, (ii) each Graystone Stock Option Conversion Fraction assumed by Tower may be exercised solely for shares of Tower Common Stock, (as defined in this Section 2.4(a)) multiplied by (yiii) the number of shares of Company Tower Common Stock which could have been obtained subject to such Graystone Stock Option shall be equal to the number of shares of Graystone Common Stock subject to such Graystone Stock Option immediately prior to the Effective Time upon Date multiplied by the exercise Exchange Ratio, provided that any fractional shares of each Tower Common Stock resulting from such Company Stock Option (multiplication shall be rounded down to the nearest whole share), at an and (iv) the per share exercise price under each such Graystone Stock Option shall be adjusted by dividing the per share (exercise price under each such Graystone Stock Option by the Exchange Ratio, provided that such exercise price shall be rounded up to the nearest cent. Notwithstanding clauses (iii) equal to and (iv) of the exercise price for preceding sentence, each such share of Company Common Stock subject to a Company Graystone Stock Option divided which is an “incentive stock option” shall be adjusted as required by Sections 409A and 424 of the Stock Option Conversion FractionIRC, and the regulations and guidance promulgated thereunder, so as not to constitute a modification, extension or renewal of the option within the meaning of Sections 409A and 424(h) of the IRC. Tower and Graystone agree to take all references necessary steps to effect the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms foregoing provisions of this Section 2.4(a) shall be referred 1.02(g), including in the case of Tower taking all corporate action necessary to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the a sufficient number of shares of Parent Tower Common Stock that will become subject for delivery upon exercise of the options to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Tower Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment issued in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsherewith.

Stock Options. At the Effective Time, each Each stock option issued and outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the 1993 Stock Option Plan, as amended, of the Company Equity Plans (each, a “Company the "Stock Option Plan") is referred to herein as an "Employee/Director Stock Option”" and all such options are referred to herein, collectively, as the "Employee/Director Stock Options." Each stock option issued and outstanding under the 1993 Directors' Stock Option Plan (the "Directors' Stock Option Plan") shall vest is referred to herein as a "Director's Option" and become fully exercisableall such options are referred to herein, whether or not then vested or subject collectively, as the "Directors' Options." The Employee/Director Stock Options and the Directors' Options are referred to any performance condition that has not been satisfied. herein, collectively, as the "Company Options" and, individually, as a "Company Option." At the Effective Time, each Company Stock Option shall become immediately fully vested and shall be converted into an option to purchase shares of Parent Common Stock, as provided below. Following the Effective Time, each such Company Option shall be exercisable upon the same terms and conditions as then are applicable to such Company Option, except that (i) each such Company Option shall be exercisable for that number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock for which could have been obtained such Company Option was exercisable immediately prior to the Effective Time upon Date and (y) the Stock Exchange Ratio and (ii) the exercise price of each such Company Stock Option (rounded down option shall be equal to the nearest whole share), at an quotient obtained by dividing the exercise price per share (rounded up of such Company Option by the Stock Exchange Ratio. From and after the date of this Agreement, no additional options to the nearest cent) equal to the exercise price for each such share purchase shares of Company Common Stock subject to a shall be granted under the Company Stock Option divided Plan, Directors' Stock Option Plan or otherwise. Except as otherwise agreed to by the Stock Option Conversion Fractionparties, and all references to no person shall have any right under any stock option plan (or any option granted thereunder) or other plan, program or arrangement of the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their termsrespect to, including pursuant any right to such preexisting terms and conditionsacquire, provided, however, that Parent shall treat each equity securities of the Company Stock Option following the Effective Time. At or as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to soon as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of a Company Option that is canceled an outstanding agreement that accurately reflects the terms of the Parent Exchange Option a document evidencing the foregoing assumption substituted therefore as contemplated by Parentthis Section 2.7. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible i) take all corporate actions necessary to use) under the Securities Act on the Closing Date with respect to the reserve for issuance such number of shares of Parent Common Stock subject as will be necessary to satisfy exercises in full of all Parent Exchange Options and shall after the Effective Time, (ii) use its commercially reasonable best efforts to cause such registration statement ensure that an effective Registration Statement on Form S-8 is on file with the Securities and Exchange Commission (the "SEC") with respect to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the CodeCommon Stock, and the Company and (iii) use its reasonable best efforts to have such shares admitted to trading upon exercises of Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsOptions.

Stock Options. At (i) On the Effective TimeDate, each outstanding unexpired FLC Option and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableeach Patriot Option which is then outstanding, whether or not then vested exercisable, shall cease to represent a right to acquire shares of FLC Common Stock or subject to any performance condition that has not been satisfied. At Patriot Common Stock, as the Effective Timecase may be, each Company Stock Option and shall be converted automatically into an option to purchase the number of shares of Parent Holding Company Common Stock, and the Holding Company shall assume each FLC Option and Patriot Option, in accordance with the terms of the applicable FLC Stock equal to Option Plan or Patriot Stock Option Plan, as the product of case may be, and the stock option agreement by which it is evidenced, except that from and after the Effective Date, (xi) the Holding Company and its Board of Directors or a duly authorized committee thereof shall be substituted for FLC, Patriot or their respective Boards of Directors or duly authorized committee thereof administering such FLC Stock Option Conversion Fraction Plan or Patriot Stock Option Plan, as the case may be, (as defined in this Section 2.4(a)ii) multiplied each FLC Option and Patriot Option assumed by the Holding Company may be exercised solely for shares of the Holding Company Common Stock, (yiii) the number of shares of Holding Company Common Stock which could have been obtained subject to each Patriot Option shall be equal to the number of shares of Patriot Common Stock subject to such Patriot Option immediately prior to the Effective Time upon Date multiplied by the exercise Patriot Exchange Ratio, provided that any fractional shares of each Holding Company Common Stock resulting from such Company Stock Option (multiplication shall be rounded down to the nearest whole share), at an and (iv) the per share exercise price under each such Patriot Option shall be adjusted by dividing the per share (exercise price under each such Patriot Option by the Patriot Exchange Ratio, provided that such exercise price shall be rounded up to the nearest cent, (v) equal to the exercise price for each such share number of shares of Holding Company Common Stock subject to a Company Stock each FLC Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed equal to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent FLC Common Stock subject to Parent such FLC Option immediately prior to the Effective Date multiplied by the Applicable FLC Common and Senior Preferred Exchange Options Ratio, provided that any fractional shares of Holding Company Common Stock resulting from such multiplication shall be rounded down to the nearest share, and (vi) the per share exercise price under each such FLC Option shall use its commercially reasonable efforts be adjusted by dividing the per share exercise price under each such FLC Option by the FLC Common and Senior Preferred Exchange Ratio, provided that such exercise price shall be rounded up to cause such registration statement to remain effective until the exercise or expiration nearest cent. Notwithstanding clauses (iii), (iv), (v) and (vi) of the Parent Exchange Optionspreceding sentence, each Patriot Option or FLC Option which is an "incentive stock option" shall be adjusted as required by Section 424 of the IRC, and the regulations promulgated thereunder, so as not to constitute a modification, extension or renewal of the option within the meaning of Section 424(h) of the IRC. For purposes Patriot and FLC agree to take all necessary steps to effect the foregoing provisions of this Section 2.4(a1.02(f), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At Effective as of the Effective TimeDistribution Date, each Tenneco shall cause all outstanding unexpired and unexercised option options to purchase or acquire a share of Company Tenneco Common Stock under held by employees and officers other than (i) Active Employees and Former Employees of Automotive Group, (ii) employees of Packaging Corporation of America and (iii) employees of the Company Equity Plans folding carton division (eachor persons who have succeeded to the rights of any persons described in (i), a “Company Stock Option”(ii) shall vest and become fully exercisable, whether or not then vested or subject (iii) with respect to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option options to purchase the number of shares of Parent Tenneco Common Stock equal Stock) to be replaced by options to purchase Packaging Common Stock. Subject to the product requirements of (x) applicable law and generally accepted accounting principles, the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share)number, at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option replacement options shall be determined in a manner which would consistent with that described in Exhibit A attached hereto. Options held by persons described in clause (ii) or (iii) above, not result exercised prior to the Distribution Date shall be canceled effective as of the Distribution Date. Options held by Active Employees and Former Employees of Automotive Group (or persons who have succeeded to the rights of such persons) shall, unless exercised prior to the Distribution Date, remain outstanding as adjusted as provided herein after the Distribution Date, subject to the requirements of applicable law and generally accepted accounting principles. The parties recognize that in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of some jurisdictions, Automotive employees were granted rights other than stock options under Section 409A in lieu of the CodeSpecial Stock Option Award of 100 options per grantee, and in those jurisdictions, the outstanding rights will be adjusted comparably. The Automotive Company options and Parent rights shall agree upon any adjustments have the same terms and conditions as prior to this Section 2.4(a) necessary the Distribution Date except that the number of options and the option exercise price shall be adjusted as described in Exhibit A attached hereto. To the extent that the exercisability of options to avoid such new purchase Tenneco Common Stock currently is subject to the attainment of share price hurdles, those hurdles will also be adjusted with respect to both options to purchase Packaging Common Stock and Tenneco Common Stock. Tenneco may grant of stock optionsspecial pre-Distribution Date exercisability with respect to some or all options which are not otherwise exercisable.

Stock Options. At In addition to the Effective Timebasic salary provided for above, each outstanding unexpired Employer hereby grants to executive the right, privilege and unexercised option (the "Stock Option") to purchase one hundred thousand (100,000) shares of the common stock, $.001 par value. The "Option Shares" are to be fully vested and become exercisable immediately. The exercise price of the Option Shares shall be twenty cents ($.20) per share. The option rights granted hereby shall be cumulative. Upon becoming exercisable, the option rights shall be exercisable at any time and from time to time, in whole or acquire in part; provided, however, that options may be exercised for no longer than five (5) years from the date of this Agreement. The options shall be exercised by written notice directed to Employer, accompanied by a share check payable to Employer for the Option shares being purchased. Employer shall make immediate delivery of Company Common Stock such purchased shares, fully paid and non-assessable, registered in the name of Executive. The certificates evidencing such shares shall bear the following restrictive legend, unless and until such shares have been registered in accordance with the Securities and Exchange Act of 1933, as amended (the "Act"): THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, (THE "ACT"), OR THE SECURITIES LAWS OF ANY OTHER JURISDICTION, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED, OR OTHERWISE DISPOSED OF IN ANY MANNER UNLESS THEY ARE REGISTERED UNDER SUCH ACT AND THE SECURITIES LAWS OR ANY APPLICABLE JURISDICTIONS OR UNLESS PURSUANT TO ANY EXEMPTION THEREFROM. Employer shall use its best efforts to register the Option Shares under the Company Equity Plans (eachAct at the earlier of such time as it registers shares issuable pursuant to a qualified employee stock option plan or such time as it registers shares beneficially owned by or issued to either or all of the following individuals: If, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition the extent that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product common stock of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option Employer shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their termsincreased or reduced by whatever action, including pursuant but not limited to such preexisting terms and conditionschange of par value, providedsplit, howeverreclassification, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to distribution or a dividend payable in stock, or the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a)like, the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange the Stock Option and the exercise option price per share shall be proportionately adjusted. If Employer is reorganized or consolidated or merged with another corporation, Executive shall be entitled to receive options covering shares of such Parent Exchange Option shall be determined in a manner which would not result reorganized, consolidated, or merged company in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A same proportion, at an equivalent price, and subject to the same conditions. For purposes of the Codepreceding sentence, the excess of the aggregate fair market value of the shares subject to the option immediately after any such reorganization, consolidation, or merger over the aggregate option price of such shares shall not be more than the excess of the aggregate fair market value of all shares subject to the Stock Option immediately before such reorganization, consolidation, or merger over the aggregate option price of such shares, and the Company new option or assumption of the old Stock Option shall not give Executive additional benefits which he did not have under the old Stock Option, or deprive him of benefits which he had under the old Stock Option. Executive shall have no rights as a stockholder with respect to the Option Shares until exercise of the Stock Option and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant payment of stock optionsthe Option Price as herein provided.

Stock Options. At On the Effective TimeDate, each outstanding unexpired and unexercised option Executive will be granted options to purchase or acquire a share One Million (1,250,000) shares of Company Common Stock under common stock of the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price equal to $1.01 per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Non-Qualified Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 Agreement (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean Agreement”) which is attached hereto as Exhibit B to the Exchange Ratio subject to adjustment in accordance with Section 2.1(d)Agreement. THE SHARES ISSUABLE PURSUANT TO THIS AGREEMENT ARE SUBJECT TO AN OPTION TO REPURCHASE AND A RIGHT OF FIRST REFUSAL PROVIDED UNDER THE PROVISIONS OF THE COMPANY’S 2002 STOCK OPTION PLAN AND THIS AGREEMENT IS ENTERED INTO PURSUANT THERETO. COPIES OF THE PLAN ARE AVAILABLE UPON WRITTEN REQUEST TO THE COMPANY AT ITS PRINCIPAL EXECUTIVE OFFICES. SWIFT FOODS COMPANY 2002 STOCK OPTION PLAN NON-QUALIFIED STOCK OPTION AGREEMENT November 6, 2006 Rxx Xxxxxxx c/o Swift Foods Company 1000 Xxxxxxxxxx Xxxxxx Xxxxxxx, Xxxxxxxx 00000 Re: Grant of Stock Option Dear Ray: The number Board of shares subject to any Parent Exchange Directors of Swift Foods Company (the “Company”) has adopted the Company’s 2002 Stock Option Plan (the “Plan”) for certain individuals, directors and the exercise price per share key employees of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent its Related Entities. A copy of the Plan is being furnished to you concurrently with the execution of this Option Agreement and shall agree upon be deemed a part of this Option Agreement as if fully set forth herein. The terms and provisions of that certain employment agreement between you and the Company, dated as of November 6, 2006 (together with any adjustments successor or replacement agreement, the “Employment Agreement”), that relate to or affect the Option are incorporated herein by reference. Terms not defined herein that are defined in the Employment Agreement shall have the respective meanings set forth in the Employment Agreement. Terms not defined herein that are not defined in the Employment Agreement shall have the respective meanings set forth in the Plan. In the event of any conflict or inconsistency between the terms and conditions of this Section 2.4(a) necessary to avoid such new grant Option Agreement and the terms and conditions of stock optionsthe Employment Agreement, the terms and conditions of the Employment Agreement shall be controlling.

Stock Options. At Prior to the Effective Time, the Board of Directors of the Company (the “Company Board”) (or, if appropriate, any committee thereof) shall adopt appropriate resolutions and take all other actions necessary and appropriate to provide that, immediately prior to the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock Option under the Company Equity Plans (each, a “any Company Stock Option”) shall vest and become fully exercisableOption Plan, whether or not then vested exercisable or vested, shall be cancelled and, in exchange therefor, each former holder of any such cancelled Option shall be entitled to receive, in consideration of the cancellation of such Option and in settlement therefor, a payment in cash (subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall applicable withholding or other taxes required by applicable Legal Requirements to be converted into withheld) of an option to purchase the number of shares of Parent Common Stock amount equal to the product of (xA) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the total number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock previously subject to a Company Stock such Option divided by and (B) the Stock Option Conversion Fractionexcess, and all references to the Company in each such option shall be deemed to refer to Parentif any, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and Per Share Price over the exercise price per share of Company Common Stock previously subject to such Parent Exchange Option (such amounts payable hereunder being referred to as the “Option Payment”). From and after the Effective Time, any such cancelled Option shall no longer be determined in a manner which would not result in exercisable by the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A former holder thereof, but shall only entitle such holder to the payment of the CodeOption Payment, and the Company shall obtain all necessary consents to ensure that former holders of Options will have no rights other than the right to receive the Option Payment. As of the Effective Time, all Company Stock Option Plans shall be terminated and no further Options shall be granted thereunder. No less than thirty (30) days prior to the Effective Time, the Company shall provide each holder of an unexpired and unexercised Option under any Company Stock Option Plan with written notice of the potential merger contemplated by this Agreement, in a manner reasonably satisfactory to Parent and Parent’s counsel. Such written notice will notify the holder of an unexpired and unexercised Option of the right to exercise such Option within thirty (30) days from the date of the notice, and that such Option will terminate upon the expiration of the 30-day period. As an alternative to the foregoing, prior to the Effective Time, the Company may adopt appropriate resolutions and take all other actions necessary and appropriate to provide that, prior to the Effective Time, each unexpired and unexercised Option under any Company Stock Option Plan, whether or not then exercisable or vested, shall agree upon any adjustments be exercisable prior to this Section 2.4(a) necessary to avoid such new grant of stock optionsthe Effective Time and, if not so exercised, shall be terminated.

Stock Options. (a) At the Effective Time, each Synchrologic Option outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At at the Effective Time, each Company Stock Option whether vested or unvested, shall be converted into assumed by Pumatech and deemed to constitute an option (a “Pumatech Option”) to purchase acquire, on the same terms and conditions as were applicable under the Synchrologic Option (except for any right of first refusal or repurchase provisions contained in the Synchrologic Option which shall cease to apply after the Effective Time), the same number of shares of Parent Pumatech Common Stock equal as the holder of such Synchrologic Option would have been entitled to receive pursuant to the product of (x) the Stock Option Conversion Fraction (as defined Merger had such holder exercised such option in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained full immediately prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole sharenumber), at an exercise a price per share (rounded up to the nearest whole cent) equal to (i) the aggregate exercise price for each such share the shares of Company Synchrologic Common Stock subject otherwise purchasable pursuant to a Company Stock such Synchrologic Option divided by (ii) the number of full shares of Pumatech Common Stock deemed purchasable pursuant to such Pumatech Option Conversion Fractionin accordance with the foregoing; provided, however, that, in the case of any Synchrologic Option to which Section 422 of the Code applies (“incentive stock options”), the option price, the number of shares purchasable pursuant to such option and all references to the Company in each terms and conditions of exercise of such option shall be deemed determined in order to refer to Parentcomply with Section 424(a) of the Code. Concurrently with the assumption of the Synchrologic Options by Pumatech at the Effective Time, where appropriate. The other terms all Synchrologic Options that then remain unvested will immediately and fully vest, with no further action required by Synchrologic, Pumatech or the holders of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisableSynchrologic Options. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance assumption by Pumatech of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Synchrologic Options pursuant to this Section 2.4(a6.3(a). As promptly as reasonably practicable after , Synchrologic shall be deemed to have assigned to Pumatech, effective at the Effective Time, Parent shall issue Synchrologic’s right, if any, to each holder repurchase unvested shares of an outstanding Parent Exchange Option a document evidencing Synchrologic Common Stock issuable upon the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (exercise of the Synchrologic Options or any successor or other appropriate form that Parent is eligible to use) previously issued upon the exercise of options granted under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a)Synchrologic Option Plan, the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number the terms of shares subject to any Parent Exchange the Synchrologic Option Plan and the exercise price per share of such Parent Exchange related stock option agreements and stock purchase agreements entered into under the Synchrologic Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsPlan.

Stock Options. All options which may be exercised for issuance of Company Common Stock (each, a "Stock Option" and collectively the "Stock Options") are described in Section 1.6 of the Company Disclosure Schedule and are issued and outstanding pursuant to the Company's 1999 Incentive Stock Option Plan and the Company's 2004 Incentive Stock Option Plan (the "Company Stock Option Plans") and the agreements pursuant to which such Stock Options were granted (each, an "Option Grant Agreement"). True and complete copies of the Company's Stock Option Plans and all Option Grant Agreements relating to outstanding Stock Options have been delivered to Buyer. At the Effective Time, each Stock Option which is outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableimmediately prior thereto, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Timeexercisable, each Company Stock Option shall automatically be converted into an option to purchase Buyer Common Stock (a "New Option") as follows: (i) the number of shares of Parent Buyer Common Stock covered by each New Option shall equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained covered by the corresponding Stock Option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option Exchange Ratio and (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest centii) equal to the exercise price for each such share New Option shall equal the exercise price of Company Common Stock subject to a Company the corresponding Stock Option immediately prior to the Effective Time divided by the Stock Option Conversion FractionExchange Ratio. In substantially all respects, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options each New Option shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant otherwise be identical to the terms of this Section 2.4(a) shall be referred the corresponding Stock Option in effect immediately prior to the consummation of the Merger, subject to any provisions in the Company Stock Option Plans which require acceleration of vesting as a “Parent Exchange Option.” result of the consummation of the Merger. In connection with effecting such conversion, the issuance of Parent Exchange Options, Parent shall reserve for issuance the aggregate number of shares of Parent Buyer Common Stock that will become to be subject to Parent Exchange Options pursuant each New Option will be rounded up or down, if necessary, to this Section 2.4(athe nearest whole share (with one-half being rounded up) and the aggregate exercise price shall be rounded up or down, if necessary, to the nearest whole cent (with one-half being rounded up). As promptly as reasonably practicable after At the Effective Time, Parent the Company Stock Option Plans shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parentbe terminated. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date The adjustments provided herein with respect to the shares of Parent Common any Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration that are "incentive stock options" (as defined in Section 422 of the Parent Exchange Code) shall be effected in such manner as shall not cause a modification, extension or renewal of the Stock Options, within the meaning of Section 424(a) of the Code. For purposes of this Section 2.4(a)Prior to the Effective Time, the “Company shall take or cause to be taken all actions required under the Company Stock Option Conversion Fraction” Plans to provide for the foregoing. At the request of any holder of New Options, Buyer shall mean the Exchange Ratio subject to adjustment assist such holder in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share effecting cashless exercises of such Parent Exchange Option shall be determined in a manner which would not result New Options with third-party brokers in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant same manner that Buyer assists holders of stock options granted by Buyer under Section 409A its stock options plans to effect cashless exercises of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsoptions with third-party brokers.

Stock Options. At Each option outstanding at the Effective Time, each outstanding unexpired and unexercised option Time to purchase or acquire a share shares of Company Common Stock (a "STOCK OPTION") granted under (A) the Company's Executive Long Term Incentive Plan, (B) the Company's Amended and Restated 1987 Directors Stock Option Plan, (C) the Company's Amended and Restated 1990 Incentive Plan (the "1990 PLAN"), (D) the Company's 1996 Directors Stock Option Plan, (E) the Company's Bonus Deferral Plan (the "BONUS DEFERRAL PLAN"), (F) the 1981 Stock Option Plan or (G) any other written or otherwise binding stock option plan or agreement of the Company Equity Plans except the Company's 1984 Employee Stock Purchase Plan, the 1985 Employee Stock Purchase Plan and the Amended and Restated Raychem Corporation Limited Employee Stock Purchase Plan (eachthe "STOCK PURCHASE PLANS") (collectively, a “Company the "COMPANY STOCK OPTION PLANS"), shall constitute an option (an "ADJUSTED OPTION") to acquire, on the same terms and conditions MUTATIS MUTANDIS as were applicable to such Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject Option prior to any performance condition that has not been satisfied. At the Effective TimeTime (but taking account of the Merger), each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal Shares (rounded down to the product of a whole Parent Common Share) determined by multiplying (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained subject to such Stock Options immediately prior to the Effective Time upon the exercise of each such Company Stock Option by (rounded down to the nearest whole share)y) 0.4140, at an exercise a price per share (rounded up to the nearest a whole cent) equal to (u) the per share exercise price for each such share of Company Common Stock subject otherwise purchasable pursuant to a Company such Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate(v) 0.4140. The other terms of each such Stock Option, and the Company Stock Options Option Plans under which they were issued, shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditionsincluding, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms extent provided therein or under the Company's Key Employee Retention and Severance Plan, the acceleration of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In vesting of such Stock Options in connection with the issuance transactions contemplated hereby or upon the termination of Parent Exchange Options, Parent shall reserve for issuance the number employment of shares a holder of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a)an Adjusted Option. As promptly soon as reasonably practicable after the Effective Time, Parent Merger Sub shall issue cause to be delivered to each holder of an outstanding Parent Exchange Stock Option an appropriate notice setting forth such holder's rights pursuant thereto, and stating that such Stock Option shall continue in effect on the same terms and conditions (subject to the adjustments as a document evidencing result of the foregoing assumption by ParentMerger described in this Section 1.06(c)). Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under comply with the Securities Act on the Closing Date with respect terms of all such Adjusted Options and ensure, to the shares of Parent Common Stock extent required by, and subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a)provisions of, the “Company Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner Plans, that Adjusted Options which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated qualified as a new grant of incentive stock options under Section 409A 422(b) of the CodeCode ("ISOS") prior to the Effective Time continue to qualify as ISOs after the Effective Time to the extent permissible under governing law. Nothing in this paragraph is intended to or shall amend or modify the terms of any Stock Option, and including any provision for its expiration, cancellation or forfeiture in a transaction such as the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsMerger.

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “"Company Stock Option”") shall vest and become fully exercisable, to purchase shares of Company Stock granted under the Company Stock Plans that is outstanding immediately prior to the Effective Time (whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option vested) shall be converted into an option deemed fully vested and shall be cancelled in exchange for the right to purchase the number of receive shares of Parent Common Stock (without interest, and subject to deduction for any required withholding Tax, with cash being paid in lieu of issuing fractional shares of Parent Common Stock) with a value equal to the product of (xi) the excess (if any) of the Merger Consideration Closing Value minus the exercise price per share under such Company Stock Option Conversion Fraction and (as defined in this Section 2.4(a)) multiplied by (yii) the number of shares of Company Common Stock which could have been obtained prior subject to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, Option; provided, however, that Parent shall treat each (a) if the exercise price per share of any such Company Stock Option as fully vested and exercisable. Each is equal to or greater than the Merger Consideration Closing Value, such Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred cancelled without any payment being made in respect thereof, and (b) at the option of Parent, in lieu of paying all or a portion of the amounts due to as a “Parent Exchange Option.” In connection with the issuance holder of Parent Exchange Options, Parent shall reserve for issuance the number of Company Stock Options under this paragraph in shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective TimeStock, Parent may substitute for such shares an equivalent amount in cash, and (c) such holders of Company Stock Options shall issue have delivered to each holder the Company an executed Option Consent Agreement. For purposes of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to preceding sentence, the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts be issued to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion holders of Company Stock Options into shall be deemed to have a value equal to the closing price of Parent Exchange Options Common Stock on the NYSE on the trading day immediately preceding the Closing Date. Promptly following the Closing Date (and, in any event, within ten Business Days thereof), Parent shall (1) if any shares of Parent Common Stock are being treated as a new grant issued to any holder of stock options under Section 409A of the CodeCompany Stock Options, cause Parent's transfer agent to issue such Parent Common Stock, and (2) if any cash payments are being made to any holder of Company Stock Options, cause the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid process such new grant of stock optionspayments through its payroll system.

Stock Options. (i) At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Waypoint Common Stock under the Company Equity Plans (each, a “Company Stock "Waypoint Option”") shall vest and become fully exercisable, which is then outstanding whether or not then exercisable, shall become fully vested or subject and exercisable and shall cease to any performance condition that has not been satisfied. At the Effective Time, each Company represent a right to acquire shares of Waypoint Common Stock Option and shall be converted automatically into an option to purchase shares of Sovereign Common Stock and the corresponding number of Sovereign Stock Purchase Rights, and Sovereign shall assume each Waypoint Option, in accordance with the terms of the applicable Waypoint Stock Option Plan and stock option agreement by which such option is evidenced, except that from and after the Effective Time, (A) Sovereign and its Board of Directors or a duly authorized committee thereof shall be substituted for Waypoint and Waypoint's Board of Directors or duly authorized committee thereof administering such Waypoint Stock Option Plan, (B) each Waypoint Option assumed by Sovereign may be exercised solely for shares of Parent Sovereign Common Stock equal and accompanying Sovereign Stock Purchase Rights (subject to any limited rights or cash settlement rights set forth in the product of (x) the applicable Waypoint Stock Option Conversion Fraction Plans or related Waypoint stock option agreements), (as defined in this Section 2.4(a)) multiplied by (yC) the number of shares of Company Sovereign Common Stock which could have been obtained subject to such Waypoint Option shall be equal to the number of shares of Waypoint Common Stock subject to such Waypoint Option immediately prior to the Effective Time upon multiplied by the exercise Exchange Ratio, provided that any fractional shares of each Sovereign Common Stock resulting from such Company Stock Option (multiplication shall be rounded down to the nearest whole share), at an and (D) the per share exercise price under each such Waypoint Option shall be adjusted by dividing the per share (exercise price under each such Waypoint Option by the Exchange Ratio, provided that such exercise price shall be rounded up to the nearest cent. Notwithstanding clauses (C) equal to and (D) of the exercise price for preceding sentence, each such share Waypoint Option which is an "incentive stock option" shall be adjusted as required by Section 424 of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion FractionIRC, and the regulations promulgated thereunder, so as not to constitute a modification, extension or renewal of the option within the meaning of Section 424(h) of the IRC. Sovereign and Waypoint agree to take all references necessary steps to effect the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms foregoing provisions of this Section 2.4(a) shall be referred to as a “Parent Exchange Option1.02(h).” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At In addition to the Effective Timebasic salary provided for above, each outstanding unexpired Employer hereby grants to executive the right, privilege and unexercised option (the "Stock Option") to purchase Five hundred thousand (500,000) shares of the common stock, $0.001 par value. The "Option Shares" are to be fully vested and become exercisable immediately. The exercise price of the Option Shares shall be Twenty-five ($.25) per share. The option rights granted hereby shall be cumulative. Upon becoming exercisable, the option rights shall be exercisable at any time and from time to time, in whole or acquire in part; provided, however, that options may be exercised for no longer than three (3) years from the date of this Agreement. The options shall be exercised by written notice directed to Employer, accompanied by a share check payable to Employer for the Option shares being purchased. Employer shall make immediate delivery of Company Common Stock such purchased shares, fully paid and non-assessable, registered in the name of Executive. The certificates evidencing such shares shall bear the following restrictive legend, unless and until such shares have been registered in accordance with the Securities and Exchange Act of 1933, as amended (the "Act"): THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, (THE "ACT"), OR THE SECURITIES LAWS OF ANY OTHER JURISDICITON, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED, OR OTHERWISE DISPOSED OF IN ANY MANNER UNLESS THEY ARE REGISTERED UNDER SUCH ACT AND THE SECURITIES LAWS OR ANY APPLICABLE JURISDICITONS OR UNLESS PURSUANT TO ANY EXEMPTION THEREFROM. Employer shall use its best efforts to register the Option Shares under the Company Equity Plans (eachAct at the earlier of such time as it registers shares issuable pursuant to a qualified employee stock option plan or such time as it registers shares beneficially owned by or issued to either or all of the following individuals: If, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition the extent that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product common stock of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option Employer shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their termsincreased or reduced by whatever action, including pursuant but not limited to such preexisting terms and conditionschange of par value, providedsplit, howeverreclassification, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to distribution or a dividend payable in stock, or the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a)like, the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange the Stock Option and the exercise option price per share shall be proportionately adjusted. If Employer is reorganized or consolidated or merged with another corporation, Executive shall be entitled to receive options covering shares of such Parent Exchange Option shall be determined in a manner which would not result reorganized, consolidated, or merged company in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A same proportion, at an equivalent price, and subject to the same conditions. For purposes of the Codepreceding sentence, the excess of the aggregate fair market value of the shares subject to the option immediately after any such reorganization, consolidation, or merger over the aggregate option price of such shares shall not be more than the excess of the aggregate fair market value of all shares subject to the Stock Option immediately before such reorganization, consolidation, or merger over the aggregate option price of such shares, and the Company new option or assumption of the old Stock Option shall not give Executive additional benefits which he did not have under the old Stock Option, or deprive him of benefits which he had under the old Stock Option. Executive shall have no rights as a stockholder with respect to the Option Shares until exercise of the Stock Option and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant payment of stock optionsthe Option Price as herein provided.

Stock Options. At ECC and the Effective TimeCompany shall take any and all action as shall be necessary or appropriate so that outstanding options issued under the Amended and Restated EchoStar Communications Corporation 1995 Stock Incentive Plan, each outstanding unexpired the EchoStar Communications Corporation 1999 Stock Incentive Plan, the EchoStar Communications Corporation 2001 Nonemployee Director Stock Option Plan and unexercised option the ECC 1995 Nonemployee Director Stock Option Plan) (collectively, the “ECC SIPs”) to purchase or acquire a share of Company ECC Class A Common Stock (“ECC Stock Options”) held at the close of business on the Distribution Date by current and former employees and directors of ECC and its Subsidiaries and Affiliates (or their respective transferees) shall be replaced pursuant to the terms of the ECC SIPs with an adjusted ECC Stock Option with an adjusted exercise price and a substitute option under the EchoStar Holding Corporation Transition Stock Incentive Plan (the “Company Equity Plans SIP”) to purchase Company Class A Common Stock (each, a “Company Stock Option”). Such replacement will be implemented in a manner such that immediately following the Distribution (i) shall vest and become fully exercisable, whether or not then vested or subject the number of shares relating to any performance condition that has not been satisfied. At the Effective Time, each Company adjusted ECC Stock Option shall will be converted into an option equal to purchase the number of shares of Parent ECC Class A Common Stock subject to such option immediately prior to the Distribution, (ii) the number of shares subject to the substitute Company Stock Option will be equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Class A Common Stock which could that the option holder would have been obtained prior to received in the Effective Time upon Distribution had the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company ECC Class A Common Stock subject to a Company the option represented outstanding shares of ECC Class A Common Stock, and (iii) the per share option exercise price of the original ECC Stock Option divided by will be proportionally allocated between such separate stock options based upon the relative per share trading prices of ECC Class A Common Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to ParentClass A Common Stock immediately following the Distribution, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance intention that such adjustment and substitution satisfy the requirements of Parent Exchange Options, Parent shall reserve for issuance Section 424 of the number of shares of Parent Common Stock that will become Code and avoid treatment as non–qualified deferred compensation subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code. Each adjusted ECC Stock Option and substituted Company Stock Option adjusted from or substituted for an original ECC Stock Option described in this Section 5.01 (a), when combined, will in the exclusive and sole discretion of the administrative committee established pursuant to the applicable ECC SIP (the “ECC SIP Committee”) preserve the intrinsic value of such original ECC Option, and each will preserve the ratio from the original option of the exercise price to the fair market value of the stock subject to the option. Fractional shares shall be adjusted or compensated by ECC as appropriate in the sole discretion of the ECC SIP Committee. All employment with both ECC and the Company shall be taken into account for purposes of determining the vesting and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid exercisability provisions of such new grant of stock optionsawards.

Stock Options. At Subject to approval by the Board or the Compensation Committee, effective on the Effective TimeDate, each outstanding unexpired and unexercised option Employee will be granted stock options to purchase or acquire an aggregate of 250,000 shares of the Company’s common stock (the “Common Stock”) at a per share exercise price equal to the closing sale price of Company the Common Stock under on the Company Equity Plans Nasdaq Global Select Market on the date of grant, in two awards: (each, a “Company Stock Option”i) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal 100,000 shares, which will be granted pursuant to and subject to the product terms and conditions of the Company’s 2017 Equity Incentive Plan (xthe “2017 Plan Option”), and (ii) an option to purchase 150,000 shares, which will be an inducement material to you joining the Stock Company, pursuant to Rule 5635(c)(4) of the Nasdaq Listed Company Manual (the “Inducement Option” and together with the 2017 Plan Option, the “Options”) The 2017 Plan Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior will be, to the Effective Time upon maximum extent permissible, treated as an “incentive stock option” within the exercise meaning of each such Company Stock Option (rounded down to Section 422 of the nearest whole share), at an exercise price per share (rounded up to Internal Revenue Code and the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, rules and all references to the Company in each such option shall be deemed to refer to Parent, where appropriateregulations thereunder. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock 2017 Plan Option as fully vested and exercisable. Each Company Stock Option converted pursuant will be further subject to the terms of this Section 2.4(a) shall a stock option agreement as approved by the Board setting forth the exercise price, vesting conditions and other restrictions, and the Inducement Option will be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a)all terms, vesting schedules and other provisions as set forth in a separate option agreement. As promptly as reasonably practicable after the Effective Time, Parent shall issue to One fourth (1/4th) of each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange 2017 Plan Option and the exercise price per share of such Parent Exchange Inducement Option shall be determined in a manner which would not result in will vest on the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A first (1st) anniversary of the CodeEffective Date, and one forty-eighth (l/48th) of each of the 2017 Plan Option and the Inducement Option will vest each month over the following thirty-six (36) months thereafter, so long as Employee remains employed by the Company through each such vesting date. Fifty percent (50%) of any unvested portion of the 2017 Plan Option and Parent shall agree upon 50% of any adjustments unvested portion of the Inducement Option will vest immediately prior to, and subject to, the consummation of a Change in Control (as defined below) and, subject to this Employee’s execution of the release of claims described in Section 2.4(a4(b), any remaining unvested portion of the 2017 Plan Option and any remaining unvested portion of the Inducement Option will immediately vest if Employee’s employment is terminated by the Company without Cause (as defined below) necessary or Employee resigns with Good Reason (as defined below) within ninety (90) days following a Change in Control. A “Change in Control’’ means (i) the Company’s merger or consolidation with or into another entity such that the stockholders of the Company prior to avoid such new grant transaction do not or are not expected to own a majority of the voting stock optionsof the surviving entity, (ii) the sale or other disposition of all or substantially all of the assets of the Company, or (iii) the sale or other disposition of greater than fifty percent (50%) of the then-outstanding voting stock of the Company by the holders thereof to one or more persons or entities who are not then stockholders of the Company.

Stock Options. At As of the Effective Time, each close of business on the Reference Date: (i) 2,079,286 shares of LTX-Credence Common Stock were subject to issuance pursuant to outstanding unexpired and unexercised option LTX-Credence Options (as defined below) to purchase or acquire a share of Company LTX-Credence Common Stock under the Company Equity Plans applicable LTX-Credence Stock Plan (eachas defined below) (equity or other equity-based awards, a “Company Stock Option”) shall vest and become fully exercisablewhether payable in cash, shares or otherwise, whether or not then vested granted under or subject pursuant to the LTX-Credence Share Plans, other than LTX-Credence Restricted Shares or LTX-Credence Restricted Share Units, are referred to in this Agreement as “LTX-Credence Options”), and (ii) 646,565 shares of LTX-Credence Common Stock are reserved for future issuance under the LTX-Credence Share Plans, including 326,477 shares reserved for issuance under the LTX-Credence Purchase Plan. Section 2.2(c) of the LTX-Credence Disclosure Schedule sets forth a complete and accurate list of all stock option plans or any other plan or agreement adopted by LTX-Credence that provides for the issuance of equity to any performance condition that Person (the “LTX-Credence Share Plans”). LTX-Credence has not been satisfiedmade available to Verigy complete and accurate copies of all LTX-Credence Share Plans and the forms of all award agreements evidencing outstanding awards under such plans. At LTX-Credence has made available to Verigy a true and complete list of each LTX-Credence Option outstanding as of the Effective TimeReference Date, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of and (x1) the particular LTX-Credence Stock Plan or other arrangement pursuant to which such LTX-Credence Option Conversion Fraction was granted, (as defined in this Section 2.4(a)2) multiplied by the name of the holder of such LTX-Credence Option, (y3) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company LTX-Credence Common Stock subject to a Company Stock such LTX-Credence Option, (4) the exercise price of such LTX-Credence Option, (5) the date on which such LTX-Credence Option divided by was granted, (6) the Stock Option Conversion Fractionapplicable vesting schedule, and all references the extent to the Company in each which such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock LTX-Credence Option as fully was vested and exercisable. Each Company Stock exercisable as of the Reference Date, (7) the date on which such LTX-Credence Option converted pursuant expires and (8) whether such LTX-Credence Option is intended to the terms of this Section 2.4(a) shall be referred to qualify as a nonstatutory stock option or an “Parent Exchange Option.incentive stock option” In connection with within the issuance meaning of Parent Exchange Options, Parent shall reserve for issuance Section 422 of the number of Code. All shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent LTX-Credence Common Stock subject to Parent Exchange issuance under the applicable LTX-Credence Benefit Plans, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issued, would be duly authorized, validly issued, fully paid and nonassessable. All grants of LTX-Credence Options were validly issued and shall use its commercially reasonable efforts to cause such registration statement to remain effective until properly approved by the exercise Board of Directors of LTX-Credence (or expiration of a duly authorized committee or subcommittee thereof) in material compliance with all applicable Legal Requirements and recorded on the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment LTX-Credence Financials in accordance with Section 2.1(d)GAAP. The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A As of the CodeReference Date, there are no outstanding or authorized stock appreciation, phantom stock, profit participation or other similar rights or equity based awards (whether payable in cash, shares or otherwise) with respect to LTX-Credence other than as set forth in Sections 2.2(b) and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options(c).

Stock Options. At Effective as of the Effective TimeDistribution Date, each Tenneco shall cause all outstanding unexpired and unexercised option options to purchase or acquire a share of Company Tenneco Common Stock under held by employees and officers other than (i) Active Employees and Former Employees of Automotive Group, (ii) employees of Packaging Corporation of America and (iii) employees of the Company Equity Plans folding carton division (eachor persons who have succeeded to the rights of any persons described in (i), a “Company Stock Option”(ii) shall vest and become fully exercisable, whether or not then vested or subject (iii) with respect to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option options to purchase the number of shares of Parent Tenneco Common Stock equal Stock) to be replaced by options to purchase Packaging Common Stock. Subject to the product requirements of (x) applicable law and generally accepted accounting principles, the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share)number, at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option replacement options shall be determined in a manner which would consistent with that described in Exhibit A attached hereto. Options held by persons described in clause (ii) or (iii) above, not result exercised prior to the Distribution Date shall be canceled effective as of the Distribution Date. Options held by Active Employees and Former Employees of Automotive Group (or persons who have succeeded to the rights of such persons) shall, unless exercised prior to the Distribution Date, remain outstanding as adjusted as provided herein after the Distribution Date, subject to the requirements of TENNECO DISTRIBUTION AGREEMENT applicable law and generally accepted accounting principles. The parties recognize that in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of some jurisdictions, Automotive employees were granted rights other than stock options under Section 409A in lieu of the CodeSpecial Stock Option Award of 100 options per grantee, and in those jurisdictions, the outstanding rights will be adjusted comparably. The Automotive Company options and Parent rights shall agree upon any adjustments have the same terms and conditions as prior to this Section 2.4(a) necessary the Distribution Date except that the number of options and the option exercise price shall be adjusted as described in Exhibit A attached hereto. To the extent that the exercisability of options to avoid such new purchase Tenneco Common Stock currently is subject to the attainment of share price hurdles, those hurdles will also be adjusted with respect to both options to purchase Packaging Common Stock and Tenneco Common Stock. Tenneco may grant of stock optionsspecial pre-Distribution Date exercisability with respect to some or all options which are not otherwise exercisable.

Stock Options. At Section 2.2(c) of the Effective TimeCasden Disclosure Letter sets forth the options granted under the Casden Stock Plan, the dates on which options under the plan were granted, name of the optionee for each such grant, the number of options granted on each such date, the exercise price thereof, and the vesting schedule thereof. Pursuant to Section 10 of the Casden Stock Plan, upon notice from the Board (as defined in the Casden Stock Plan) of the pendency of the Merger, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Casden Common Stock granted under the Company Equity Plans Casden Stock Plan (each, a “Company Stock "Casden Option”") will become exercisable in full for a period of thirty (30) days following the delivery of such notice. AIC shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained exercise his Casden Options prior to the Effective Time upon the on a net exercise of each such Company Stock Option (rounded down basis. Immediately prior to the nearest whole share)expiration of such thirty (30) day period, at each holder of an unexercised Casden Option shall be entitled to receive from Casden in cancellation thereof a payment (subject to applicable withholding taxes) in an amount equal to (i) the excess, if any, of $21.66, over the per share exercise price per share (rounded up to of such Casden Option, multiplied by the nearest cent) equal to the exercise price for each such share number of Company unexercised shares of Casden Common Stock subject to a Company Stock such Casden Option divided (the "Option Settlement Amount"). The aggregate Option Settlement Amount in respect of each Casden Option shall be paid by the Stock Option Conversion Fraction, and all references AIMCO in cash to the Company in each such option holder concurrently with the Closing. The surrender of a Casden Option shall be deemed to refer to Parent, where appropriate. The other terms a release of any and all rights the holder had or may have in respect of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Optionoption.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At (a) Effective as of the date hereof, each outstanding option to purchase Shares (individually a “Director Option” and collectively “Director Options”) granted under the Medialink Worldwide Incorporated Amended and Restated 1996 Directors Stock Option Plan (the “Director Option Plan”) and each outstanding option to purchase Shares (individually an “Employee Option” and collectively “Employee Options”) granted under the Medialink Worldwide Incorporated Amended and Restated Stock Option Plan as adopted as of January 31, 1996 (the “Employee Option Plan”), whether or not any such Director Options or Employee Options are then exercisable (Director Options and Employee Options being sometimes hereinafter referred to individually as an “Option” and collectively as “Options”), shall be exercisable in full at the price per Share as established for each such Option. Thereafter, effective immediately prior to the Effective Time, each outstanding unexpired and unexercised option Option to purchase or acquire a share of Company Common Stock under any Share shall be converted by the Company Equity Plans into the right to receive from the Company, on the Closing Date, in consideration for any such Option, an amount in cash equal to the product of: (each, a “Company Stock Option”i) shall vest and become fully exercisable, whether or not then vested or the number of Shares subject to such Option (other than any performance condition that portion of such Option which has not previously been satisfiedexercised); and (ii) the excess, if any, of the Merger Consideration over the exercise price per Share in effect with respect to such Option, reduced by the amount of withholding or other Taxes required by law to be withheld with respect to such payment. At Any Option (including tandem stock appreciation rights, if any, granted in connection with such Option) which, as of the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock has not been exercised and which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at provides an exercise price per share (rounded up to for the nearest cent) equal to purchase of a Share which is greater than the exercise price amount of the Merger Consideration payable for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion FractionShare, and all references to the Company in each such option shall be deemed to refer to Parentshall, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after at the Effective Time, Parent be cancelled without consideration and the holders of any such Options (including any tandem stock appreciation rights granted in connection with any such Options) shall issue have no further rights whatsoever under the terms of any such Options. On the Closing Date, the Surviving Corporation will make the payments required to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption be made by Parentthis Section 1.5(a). Parent shall file a registration statement on Form S-8 (and Merger Sub will deposit or any successor or other appropriate form that Parent is eligible cause to use) under be deposited sufficient funds with the Securities Act on Company at the Closing Date with respect to make the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of payments required by this Section 2.4(a1.5(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans Option Plan or otherwise (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including any provisions for the acceleration of vesting resulting from the consummation of the transactions contemplated by this Agreement (or any subsequent termination of employment) pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a5.7(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a5.7(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable best efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a5.7(a), the “Stock Option Conversion Fraction” Fraction shall mean the sum of (x) the Mixed Election Stock Exchange Ratio subject to adjustment in accordance with Section 2.1(d)plus (y) the fraction resulting from dividing the Per Share Cash Amount by the closing price per share of the Parent Common Stock on the NYSE on the last trading day immediately preceding the Closing Date. The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a5.7(a) necessary to avoid such new grant of stock options.

Stock Options. At In the Effective Timeevent of a Change in Control, each outstanding unexpired Executive's resignation for Good Reason or Executive's termination without Cause, all unvested stock options previously granted to Executive shall immediately vest and be exercisable as set forth below. In the event that there is a termination of Executive's employment hereunder for any reason, Executive shall be entitled to exercise any and all stock options that were previously granted to him by the Company, and are outstanding, vested and unexercised as of his Termination Date, during the exercise period ending on the shorter of (i) two (2) years from his Termination Date or (ii) the expiration date of the stock option as specified in the stock option plan or stock option agreement, as applicable, notwithstanding any provision in such plan or agreement that provides for a more limited time period to purchase exercise stock options following termination of employment; provided however, if said stock option plan or acquire stock option agreement provides therein for a share longer period of Company Common Stock under time to exercise such outstanding, vested and unexercised stock options following his Termination Date, then such stock option plan or agreement shall control and the remaining provisions of this Section 6(c) shall be inapplicable and without further force or effect. In the event that there is a termination of Executive's employment hereunder for Cause or Executive voluntarily resigns without Good Reason within two years for the date of this Agreement, Executive shall forfeit any and all stock options that were previously granted to him by the Company, and are unvested and unexercised as of his Termination Date. During the extension period specified in the previous paragraph, if applicable, the Executive shall be considered an employee of the Company Equity Plans (each, a “Company Stock Option”) who shall vest and become fully exercisable, whether or not then vested or subject make himself available to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references provide consulting services to the Company in each consideration for such extension of the option shall exercise period and any post-termination payments provided to Executive under Section 6(a) or (b) of this Agreement. In this regard, Executive agrees to be deemed classified as an employee of the Company solely for the limited purpose of making himself available to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provide consulting services on an as-needed basis; provided, however, that Parent shall treat each Company Stock Option Executive hereby specifically waives any right, entitlement, claim or demand to (i) any additional compensation for such consulting services and (ii) coverage or benefits under any of the Company's employee benefit plans or programs, or other perquisites, terms and conditions of employment, except as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms expressly specified in other provisions of this Section 2.4(a) shall be referred to Agreement. Except as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to expressly provided in this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a6(c), the “Stock Option Conversion Fraction” provision of consulting services by Executive shall mean the Exchange Ratio subject not expand his rights or duties under this Agreement. Executive hereby agrees to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A provide, upon request of the CodeCompany, and consulting services to the Company on the following terms and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.conditions:

Stock Options. (a) At the Effective Time, each WFB Stock Option which is outstanding unexpired and unexercised option immediately prior to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableEffective Time, whether or not then vested or subject and exercisable, shall cease to any performance condition that has not been satisfied. At the Effective Time, each Company represent a right to acquire shares of WFB Common Stock Option and shall be converted automatically into an option to purchase the number of shares of Parent HNC Common Stock, and HNC shall assume each WFB Stock equal to Option, in accordance with the product terms of the applicable WFB Stock Plan and stock option or other agreement by which it is evidenced, except that from and after the Effective Time, (xi) HNC and a disinterested committee of the HNC board of directors shall be substituted for WFB and the committee of the WFB board of directors (including, if applicable, the entire WFB board of directors) administering such WFB Stock Plan, (ii) each WFB Stock Option Conversion Fraction assumed by HNC may be exercised solely for shares of HNC Common Stock, (as defined in this Section 2.4(a)) multiplied by (yiii) the number of shares of Company HNC Common Stock which could have been obtained subject to such WFB Stock Option shall be equal to the number of shares of WFB Common Stock subject to such WFB Stock Option immediately prior to the Effective Time upon multiplied by the exercise Exchange Ratio, provided that any fractional shares of each HNC Common Stock resulting from such Company Stock Option (multiplication shall be rounded down to the nearest whole share), at an and (iv) the per share exercise price under each such WFB Stock Option shall be adjusted by dividing the per share (exercise price under each such WFB Stock Option by the Exchange Ratio, provided that such exercise price shall be rounded up to the nearest cent. Notwithstanding clauses (iii) equal to and (iv) of the exercise price for preceding sentence, each such share of Company Common Stock subject to a Company WFB Stock Option divided which is an “incentive stock option” shall be adjusted as required by Sections 409A and 424 of the Stock Option Conversion FractionIRC, and the regulations promulgated thereunder, so as not to constitute a modification, extension or renewal of the option within the meaning of Sections 409A and 424(h) of the IRC. HNC and WFB agree to take all references necessary steps to effect the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms foregoing provisions of this Section 2.4(a) shall be referred 2.05(a), including in the case of HNC taking all corporate action necessary to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the a sufficient number of shares of Parent HNC Common Stock that will become subject for delivery upon exercise of the options to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent HNC Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment issued in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsherewith.

Stock Options. At The Company represents to the Effective TimePurchaser that (a) all outstanding options that, each outstanding unexpired and unexercised option to purchase or acquire a share as of the Signing Date, may be exercised for shares of Company Common Stock under the Company Equity Plans (whether or not vested) (each, a “Stock Option” and collectively the “Stock Options”) are described in Schedule 4.5 and are presently governed by the Company Stock OptionCompensation Plans and the agreements pursuant to which such Stock Options were granted (each, an “Option Grant Agreement”), (b) the Stock Options presently governed by the Company Stock Compensation Plans represent the right to purchase Class C Stock and no other Equity Interests and (c) true and complete copies of the Company Stock Compensation Plans and each Option Grant Agreement relating to outstanding Stock Options have been delivered to the Purchaser. Prior to the Closing, the board of directors of the Company shall take all actions necessary such that all Stock Options that are outstanding immediately prior to the Closing (“Subject Stock Options”) (i) are fully vested in advance of the Closing in accordance with the terms of the Company Stock Compensation Plans and (ii) shall vest be forfeited prior to the Closing or, in the case of Subject Stock Options that are In-the Money Subject Stock Options, if the holders thereof execute and become fully exercisabledeliver prior to the Closing an option cancellation agreement in form and substance reasonably acceptable to the Purchaser (each, whether or not then vested or an “Option Cancellation Agreement”), cancelled in exchange for the issuance by the Purchaser at the Closing, subject to any performance condition that has not been satisfied. At the Effective TimePurchaser’s receipt of such holder’s Option Cancellation Agreement and cancelled Subject Stock Option, each Company Stock Option shall be converted into an option to purchase the such number of shares of Parent Purchaser Common Stock equal to the product quotient of the (x) the Option Cancellation Amount for such Subject Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied divided by (y) the number Share Price. Notwithstanding the foregoing, the Purchaser may elect, in its sole and absolute discretion, to satisfy the aggregate Option Cancellation Amount due to the holders of In-the Money Subject Stock Options at Closing in cash (in lieu of Purchaser Shares), and, to the extent the Purchaser so elects to make such payment in cash at Closing, such holders shall not be entitled to receipt of any shares of Company Purchaser Common Stock which could have been obtained prior Stock; provided, however that in the event the Purchaser Control Transaction results in Sellers receiving consideration that is not all cash, then Purchaser shall be required to satisfy the aggregate Option Cancellation Amount due to the Effective Time upon holders of In-the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Money Subject Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms cash (in lieu of this Section 2.4(aany securities) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Optionsat Closing. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.Agreement:

Stock Options. At Immediately prior to the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock (a "STOCK OPTION") granted under the Company's 1997 Equity Incentive Plan or the Stock Option Plan for Non-Employee Directors or pursuant to any other employee stock option plan or agreement entered into by the Company Equity Plans with any employee of the Company or any subsidiary thereof and listed on Section 2.11(c) of the Company Disclosure Schedule (each, a “Company Stock Option”) shall vest and become fully exercisablethe "COMPANY STOCK OPTION PLANS"), whether or not then vested or exercisable, shall become exercisable, subject to any performance condition the terms of the Company Stock Option Plan pursuant to which such Stock Option was issued. If and to the extent that has a Stock Option shall not have been satisfied. At exercised at the Effective Time, each Company such Stock Option shall be converted into automatically canceled. Each holder of a canceled Stock Option shall be entitled to receive as soon as practicable after the first date payment can be made without liability to such person under Section 16(b) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the "EXCHANGE ACT") from the Company in consideration for such cancellation an option to purchase the number of shares of Parent Common Stock amount in cash (less applicable withholding taxes) equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yi) the number of shares of Company Common Stock which could have been obtained prior previously subject to such Stock Option multiplied by (ii) the excess, if any, of the equivalent cash value of the Merger Consideration at the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and over the exercise price per share of Common Stock previously subject to EXECUTION COPY EXHIBIT 2.1 such Stock Option (the "OPTION CONSIDERATION") upon surrender of such Stock Option to the Company or an affidavit of loss in the form requested by Parent, together with such additional documentation as may be reasonably required by Parent Exchange or the Company. The surrender of a Stock Option in exchange for the Option Consideration in accordance with the terms of this Section 1.6(c) shall be determined deemed a release of any and all rights the holder had or may have had in a manner which would not result respect of such Stock Option. Prior to the Effective Time, the Company shall use its reasonable best efforts to obtain all necessary consents or releases from holders of Stock Options under the Company Stock Option Plans and take all such other lawful action as may be necessary to give effect to the transactions contemplated by this Section 1.6(c). Except as otherwise agreed to by the parties, (i) the provisions in the conversion of Company Stock Options into Parent Exchange Options being treated Option Plans with respect to the right to issue or grant additional options or rights to acquire Common Stock shall terminate as a new of the Effective Time and the provisions in any other plan, program or arrangement providing for the issuance or grant of stock options under Section 409A any other interest in respect of the Codecapital stock of the Company or any subsidiary thereof shall be canceled as of the Effective Time, and (ii) the Company shall use its reasonable best efforts to assure that following the Effective Time no participant in the Stock Option Plans or other plans, programs or arrangements shall have any right thereunder to acquire any equity securities of the Company, the Surviving Corporation or any subsidiary thereof and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid terminate all such new grant of stock optionsplans.

Stock Options. At (a) As soon as practicable following the date of this Agreement, the Company Board (or, if appropriate, any committee administering the Company Stock Plans) shall adopt such resolutions or take such other actions as are required to adjust the terms of all outstanding Company Employee Stock Options heretofore granted under any Company Stock Plan and Company Warrants to provide that (i) each Company Employee Stock Option outstanding at the Effective TimeTime shall be canceled effective at the Effective Time with the holder thereof becoming entitled to receive an amount of cash equal to (A) the excess, each outstanding unexpired and unexercised option to purchase or acquire a if any, of (1) the Merger Consideration over (2) the exercise price per share of Company Common Stock under the subject to such Company Equity Plans (each, a “Company Employee Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yB) the number of shares of Company Common Stock for which could such Company Employee Stock Option shall not theretofore have been obtained prior exercised, (ii) with respect to each Company Warrant (other than the Company Warrants held by Parent or OCR) outstanding at the Effective Time, the right to exercise such Company Warrant shall terminate effective at the Effective Time upon with the exercise holder thereof becoming entitled to receive an amount of each such Company Stock Option cash equal to (rounded down to C) the nearest whole share)excess, at an if any, of (1) the Merger Consideration over (2) the exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their termsWarrant, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(amultiplied by (D) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Company Common Stock that will become subject for which such Company Warrant shall not theretofore have been exercised and (iii) and each Company Warrant held by Parent or OCR outstanding at the Effective Time shall be canceled effective at the Effective Time. At the Closing, Parent shall deposit with the Paying Agent as a separate fund within the Exchange Fund the amounts to be paid by Parent Exchange to the holders of Company Employee Stock Options and Company Warrants pursuant to this Section 2.4(a)6.04; provided that the Exchange Fund may, at the option of Parent, be held in an escrow arrangement for release upon the occurrence of the Effective Time. As promptly soon as reasonably practicable after the Effective Time, Parent the Paying Agent shall issue mail, or cause to be mailed, to each holder of an outstanding Parent Exchange a Company Employee Stock Option or a document evidencing Company Warrant as of the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (Effective Time notice that the Merger has been consummated and instructions for effecting the cancelation or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect termination, to the shares extent necessary, of Parent Common such Company Employee Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause Company Warrants (and the surrender of any certificates representing any such registration statement to remain effective until Company Warrants for cancelation or termination) and obtaining the exercise or expiration payment of the Parent Exchange Options. For purposes of amounts contemplated in this Section 2.4(a)6.04, which notice and instructions shall be in such form and have such other provisions as Parent may reasonably specify, and that are reasonably acceptable to the Company, prior to the Effective Time. Upon delivery by such holder to the Paying Agent of such documents as may be reasonably requested by the Paying Agent to effectuate the payment contemplated by this Section 6.04, the “Stock Option Conversion Fraction” Paying Agent shall mean promptly deliver the Exchange Ratio subject amount to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of which such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments holder is entitled pursuant to this Section 2.4(a) necessary to avoid such new grant of stock options6.04.

Stock Options. All options which may be exercised for issuance of Company Common Stock (each, a “Stock Option” and collectively the “Stock Options”) are described in the Company Disclosure Schedule and are issued and outstanding pursuant to the Company’s 2002 Incentive Stock Option Plan, the Company Bank’s 2000 Incentive Stock Option Plan, the Company’s 2002 Stock Option Plan for Non-Employee Directors, the Company Bank’s 1998 Stock Option Plan for Non-Employee Directors or the Company Bank’s 1996 Stock Option Plan (collectively, the “Company Stock Option Plans”) and the agreements pursuant to which such Stock Options were granted (each, an “Option Grant Agreement”). True and complete copies of the Company’s Stock Option Plans and all Option Grant Agreements relating to outstanding Stock Options have been delivered to Parent. Pursuant to the terms of the Company Stock Option Plans and the consents described in this Section 1.6, the Company shall take the following actions: (x) at least ten business days prior to the anticipated Election Deadline, the Company shall give all holders of Stock Options the choice of either (A) exercising their Stock Options (whether or not then vested) prior to the Election Deadline or (B) having their unexercised Stock Options cancelled immediately prior to the Effective Time in return for the payment set forth below (the “Cancellation Choice”, it being understood that any such holder who fails to specify any such choice prior to the Election Deadline shall be deemed to have elected the Cancellation Choice) and (y) the Company shall give each person exercising Stock Options prior to the Election Deadline a Form of Election in a manner consistent with Section 1.5(i). Between the date hereof and the Closing, the Company and the Company Bank shall take all other actions necessary to effect the provisions of this Section 1.6. Concurrent with the execution of this Agreement, the Company has delivered to Parent a consent form in which each holder of Stock Options granted under the Company’s 2002 Stock Option Plan for Non-Employee Directors or the Company Bank’s 2000 Stock Option Plan for Non-Employee Directors has consented to the steps contemplated by this Section 1.6 with respect to such holder’s Stock Options. At the Effective Time, each Stock Option which is outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableimmediately prior thereto, whether or not then vested or subject exercisable, shall be canceled and all rights thereunder shall be extinguished. As consideration for such cancellation, the Company shall make payment immediately prior to any performance condition that has not been satisfied. At the Effective Time, Time to each Company holder of an outstanding Stock Option shall be converted into of an option to purchase the number of shares of Parent Common Stock equal to the product of amount, if any, determined by multiplying (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each underlying such Company Stock Option by (rounded down to the nearest whole share), at y) an exercise price per share (rounded up to the nearest cent) amount equal to the exercise price for each such share excess (if any) of Company Common Stock subject to a Company Stock Option divided by (i) the Stock Option Conversion FractionPer Share Cash Consideration, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(aover (ii) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option Stock Option, provided, however, that no such payment shall be determined made to a holder unless and until such holder has executed and delivered to the Company an instrument in a manner which would not result such form prescribed by Parent and reasonably satisfactory to the Company accepting such payment in full settlement of his or her rights relative to such Stock Options. Prior to the conversion of Effective Time, the Company shall take or cause to be taken all actions required under the Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of Option Plans to provide for the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsforegoing.

Stock Options. At Immediately following the Effective Time, each outstanding unexpired and unexercised option expiration of the ------------- rescission period described in said Paragraph 23 all vested stock options granted to purchase or acquire a share of Company Common Stock Xxxxx through the Separation Date under the Company Equity Plans Omnibus Plan and two-thirds of the stock Options granted to Xxxxx in 2001 shall remain outstanding and exercisable by him through the earlier of their original maturity date and three (each, a “Company Stock Option”3) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At years from the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, Separation Date; provided, however, that Parent the date any such option is first exercisable shall treat each Company Stock Option not be accelerated. Attached as fully Schedule C to this Agreement is a listing of such vested stock options, whether incentive or non-qualified stock options, and exercisable. Each Company Stock Option converted pursuant to the dates of first exercisability and lapse thereof in accordance with the terms of this Section 2.4(aparagraph c. To the extent options designated as incentive stock options are exercised within thirty (30) days of the last day of Xxxxx'x employment, they shall retain their status as qualified options, to the extent otherwise qualifying as incentive stock options; options exercised after this thirty (30) day period shall be referred to treated as a “Parent Exchange Option.” nonqualified options. In connection with the issuance of Parent Exchange Options, Parent event Xxxxx shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options sell any Pentair common stock acquired pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder exercise of an outstanding Parent Exchange Option incentive stock option in a document evidencing the foregoing assumption by Parent. Parent disqualifying disposition, Xxxxx shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date immediately notify Pentair of such disposition and supply all information with respect to such sale as is reasonably requested by Pentair. This notification obligation shall apply regardless of whether such options were exercised before or after the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange OptionsSeparation Date. For purposes of this Section 2.4(a)subparagraph, the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number any disposition of shares subject to any Parent Exchange Option and the Pentair common stock received upon exercise price per share of an incentive stock option, within twelve (12) months of such Parent Exchange Option exercise, shall be determined in constitute a manner which would disqualifying disposition. In the event Xxxxx should die before all such options have been exercised or otherwise lapse, then the beneficiary designated by Xxxxx shall have six (6) months from Xxxxx'x death to exercise any options then outstanding. Any options not result in so exercised shall lapse at the conversion end of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(asaid six (6) necessary to avoid such new grant of stock optionsmonth period.

Stock Options. At Each year while the Effective TimeExecutive is employed pursuant to this Agreement, each outstanding unexpired and unexercised option to purchase he shall be considered for an award of one or acquire a share of Company Common Stock more options under the Company Equity Plans Corporation’s 1997 Omnibus Incentive Plan and any successor or substitute for such plan (each, a the “Company Stock OptionOption Plan”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At by the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction Committee (as defined in this the Stock Option Plan) at such time as awards are granted to other senior executives of the Corporation. Based upon the Corporation achieving targeted consolidated performance established by the Committee (which performance may be based upon criteria different than that utilized in determining the Annual Cash Bonus under Section 2.4(a4(b) above)) multiplied , it is expected, if the Executive is then employed by (y) the number of shares of Company Common Stock which could have been obtained prior Corporation, that the Committee will grant to the Effective Time upon Executive one or more options under the exercise of each such Company Stock Option (rounded down Plan to acquire common stock of the nearest whole share), Corporation at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by Fair Market Value (as defined in the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(aPlan) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date date of grant with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and such option(s) being determined by dividing the exercise price Black-Scholes value per share or such other value per share determined by an investment banking firm selected by the Board of such Parent Exchange Option Directors (in either case utilizing duration, volatility and other criteria reasonably selected by the Board of Directors) of the shares that will be subject to the option(s) into 100% of the Corporation Salary earned by the Executive for the preceding calendar year, which value per share shall be determined in a manner which would not result in utilizing the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant same methodology (and the same assumptions applied to such methodology) that is used for grants of stock options under Section 409A at such time for other senior executives of the CodeCorporation. If the Corporation’s consolidated performance is less or greater than the targeted consolidated performance established by the Committee, the Executive may be awarded one or more options with a lesser or greater number of underlying shares, but the value of such shares on the date of grant utilizing the methodology (and assumptions) set forth above shall in no event exceed 200% of the Corporation Salary earned by the Executive for the preceding calendar year. The grant will be made as an ISO (as defined in the Stock Option Plan) to the maximum extent permissible and then as an NQSO (as defined in the Stock Option Plan). Each option granted pursuant to the provisions hereof shall have an option term of 10 years and may be subject to a vesting schedule, provided: (i) vesting will continue following an Involuntary Termination at any time, (ii) such option to the extent outstanding and unexercisable shall become fully exercisable upon the death or disability of the Executive, (iii) all vested options shall be exercisable for the unexpired balance of the option term upon a termination of Executive’s employment other than as provided in the following subparts (iv) and (v) of this subsection, (iv) such option to the extent outstanding and unexercisable shall become fully exercisable upon a Change in Control if the unexercisable portion of the option would otherwise terminate or cease to be enforceable, in whole or in part, by reason of such Change in Control and shall remain exercisable for at least one year thereafter but not beyond the expiration of the option term, and (v) the Company option shall expire, terminate, and Parent shall agree be forfeited upon any adjustments a Termination for Cause or a termination pursuant to this Section 2.4(a7(g) necessary to avoid such new grant of stock optionsbelow.

Stock Options. (a) At the Effective Time, the Target Stock Option Plans and each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company Target Common Stock under the Company Equity Plans (each, a “Company Target Stock Option”) shall vest and become fully exercisableOption Plans, whether or not then vested or subject unvested, shall be assumed by Acquiror, and Target Company's repurchase right with respect to any performance condition that has not been satisfied. At unvested option shares granted under the Effective Time, each Company Target Stock Option Plans shall be converted into an option assigned to purchase Acquiror. Target has delivered to Acquiror a schedule (the "Option Schedule") that sets forth a true and complete list as of the date hereof of all holders of outstanding options under the Target Stock Option Plans, including the number of shares of Parent Target Capital Stock subject to each such option, the exercise or vesting schedule, the exercise price per share and the term of each such option. On the Closing Date, Target shall deliver to Acquiror an updated Option Schedule current as of such date. Each such option so assumed by Acquiror under this Agreement shall continue to have, and be subject to, the same terms and conditions set forth in the Target Stock Option Plans immediately prior to the Effective Time, except that (i) such option shall be exercisable for that number of whole shares of Acquiror Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Target Common Stock which could have been obtained that were issuable upon exercise of such option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option (Exchange Ratio, and rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Acquiror Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after Stock, and (ii) the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to per share exercise price for the shares of Parent Acquiror Common Stock subject issuable upon exercise of such assumed option shall be equal to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and quotient determined by dividing the exercise price per share of Target Common Stock at which such Parent option was exercisable immediately prior to the Effective Time, by the Exchange Option Ratio, rounded up to the nearest whole cent. The options so assumed by Acquiror shall be determined in a manner which would not result in qualify following the conversion of Company Stock Options into Parent Exchange Options being treated Effective Time as a new grant of incentive stock options under as defined in Section 409A 422 of the CodeCode to the extent such options qualified as incentive stock options prior to the Effective Time. Within ten (10) business days after the Effective Time, Acquiror will issue to each person who, immediately prior to the Effective Time was a holder of an outstanding option under the Target Stock Option Plans, a document in form and substance satisfactory to Target evidencing the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid foregoing assumption of such new grant of stock optionsoption by Acquiror.

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase On or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon Closing Date, each holder of Saehan Stock Options shall have entered into an Option Holder Agreement in the exercise form of Exhibit D attached to this Agreement (the “Option Holder Agreements”) providing for the termination of such holder’s Saehan Stock Options. Each holder of such terminated Saehan Stock Options shall be entitled to receive an amount in cash equal to (i) for holders of in-the-money Saehan Stock Options, in lieu of each such Company share of Saehan Common Stock Option that would otherwise have been issuable upon exercise thereof, (rounded down to A) the nearest whole share), at an exercise weighted average sales price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Saehan Common Stock subject to a Company Stock Option divided by on the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act OTC Bulletin Board on the Closing Date with respect to (or, in the event fewer than 100,000 shares of Parent Saehan Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until traded on the exercise or expiration of OTC Bulletin Board on the Parent Exchange Options. For purposes of this Section 2.4(aClosing Date, the Per Share Cash Consideration), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and less (B) the exercise price per share with respect to the corresponding Saehan Stock Option in question, and (ii) for holders of such Parent Exchange Option shall be determined out-of-the-money Saehan Stock Options, $500 per holder of out-of-the-money Saehan Stock Options); provided, however, that, at any time between the date of this Agreement and the Closing Date, Wilshire in its sole discretion may elect to assume (or substitute a manner which would not result in the conversion of Company Wilshire stock option or options for) any Saehan Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A not currently subject to such Option Holder Agreements in accordance with Sections 8(g) and 16 of the CodeSaehan stock option plans, and the Company and Parent shall agree upon treatment of such options shall, without further action on the part of any adjustments holder or any Party hereto, be accordingly changed for purposes of this Section 2.1(c). Any payments pursuant to this Section 2.4(a2.1(c) necessary shall take place only after the satisfaction or fulfillment or waiver of the conditions of Closing contained in Articles VI. The Surviving Corporation shall collect in cash (and timely pay) all applicable withholding and payroll taxes with respect to avoid such new grant of stock optionsoptions and shall comply with all payroll reporting requirements with respect thereto.

Stock Options. At the Effective Time, each stock option (all options issued pursuant to the Insurdata Stock Option Plans are referred to herein, collectively, as the "Insurdata Options" and, individually, as an "Insurdata Option") issued and outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Insurdata Incorporated 1999 Stock Option Plan, and any other plan or program maintained by Insurdata under which Options have been granted, as listed on Section 3.1(b) of the Insurdata Disclosure Schedule (the "Insurdata Stock Option Plans") shall be converted into an option to purchase shares of HealthAxis Common Stock, as provided below. Following the Effective Time, each such Insurdata Option shall be exercisable upon the same terms and conditions as then are applicable to such Insurdata Option, except that (i) each such Insurdata Option shall be exercisable for that number of shares (rounding down to the nearest whole share, with cash being payable for any fraction of Parent a share) of HealthAxis Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Insurdata Common Stock for which could have been obtained such Insurdata Option was exercisable immediately prior to the Effective Time upon and (y) the Exchange Ratio and (ii) the exercise price of each such Company Stock Insurdata Option (rounded down shall be equal to the nearest whole share), at an exercise price per share quotient (rounded up to the nearest centone hundredth) equal to obtained by dividing the exercise price for each such per share of Company such Insurdata Option by the Exchange Ratio. Following the Effective Time, any restriction on the exercise of any Insurdata Option shall continue in full force and effect and the term, exercisability, vesting schedule and other provisions of such Insurdata Option (except as set forth in this Section 2.3) shall remain unchanged. From and after the date of this Agreement, no additional options to purchase shares of Insurdata Common Stock subject to a Company shall be granted under the Insurdata Stock Option divided Plans or otherwise. Except as otherwise agreed to by the Stock Option Conversion FractionParties, and all references to the Company in each such no person shall have any right under any stock option shall be deemed to refer to Parentplan (or any option granted thereunder) or other plan, where appropriate. The other terms program or arrangement of such Company Stock Options shall continue to apply in accordance Insurdata with their termsrespect to, including pursuant any right to such preexisting terms and conditionsacquire, provided, however, that Parent shall treat each Company Stock Option equity securities of Insurdata following the Effective Time. At or as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to soon as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent HealthAxis, as the Surviving Corporation, shall issue to each holder of an outstanding Parent Exchange Insurdata Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible converted into an option to use) under the Securities Act on the Closing Date with respect to the purchase shares of Parent HealthAxis Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration a statement to remain effective until that accurately reflects the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange of HealthAxis Common Stock for which the Insurdata Option is exercisable and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to Insurdata Option as contemplated by this Section 2.4(a) 2.3. HealthAxis shall take all corporate actions necessary to avoid reserve for issuance such new grant number of stock optionsshares of HealthAxis Common Stock as will be necessary to satisfy exercises in full of all Surviving Corporation Insurdata Options after the Effective Time.

Stock Options. At Each unexercised MSB Stock Option that is outstanding immediately prior to the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) Time shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At exercisable at the Effective Time, each Company Stock Option Time and shall be converted automatically at the Effective Time into an option to purchase shares of IBC Common Stock under the IBC Employee Stock Option Plan ("IBC Stock Option"), with the number of shares of Parent IBC Common Stock equal to the product of (x) the be subject to a particular IBC Stock Option to equal the Conversion Fraction (as defined in this Section 2.4(a)) Ratio multiplied by (y) the number of shares of Company MSB Common Stock which could have been obtained prior subject to the Effective Time upon the exercise of each such Company a particular MSB Stock Option (Option, provided that any fractional share shall be rounded down to the nearest whole share), at an ; and with the exercise price per for each share (rounded up of IBC Common Stock subject to the nearest cent) a particular IBC Stock Option to be equal to the exercise price for each such share of Company an MSB Common Stock subject to a Company Share under the MSB Stock Option divided by the Conversion Ratio. Notwithstanding the preceding sentence, in the case of any MSB Stock Option Conversion Fractionto which Section 421 of the Internal Revenue Code of 1986, and all references to as amended ("the Company in each such option shall be deemed to refer to Parent"Code") applies by reason of its qualification under Section 422 of the Code, where appropriate. The other the terms of the IBC Stock Option into which such Company MSB Stock Options shall continue Option is to apply in accordance with their termsbe converted, including the exercise price, the number of shares of IBC Common Stock purchasable pursuant to such preexisting Option, and the terms and conditionsconditions of exercise of such Option, shall be determined so as to comply with Sections 422 and 424(a) of the Code. A cash payment shall be made for any fractional share of MSB Common Stock that is not represented by the IBC Stock Option, based upon the average closing sale price of shares of IBC Common Stock on the five trading days immediately preceding the Effective Time, as reported on the Nasdaq Stock Market. Upon such conversion, all rights under each such MSB Stock Option and under the related stock option plan previously adopted by MSB ("MSB Stock Option Plan") shall terminate; provided, however, that Parent shall treat each Company the terms, benefits, rights and features of such MSB Stock Option and the agreement evidencing the grant of such MSB Stock Option, as fully vested and exercisable. Each Company Stock Option converted pursuant in existence immediately prior to the Effective Time shall, to the extent inconsistent with the terms of this Section 2.4(a) shall be referred the IBC Stock Option Plan or any similar IBC Plan, and favorable to as a “Parent Exchange the interests of the holder of the IBC Stock Option.” In connection with , continue to apply to such IBC Stock Option from and after the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a)Effective Time. As promptly soon as reasonably practicable after the Effective Time, Parent IBC shall issue deliver to each the holder of an outstanding Parent Exchange each IBC Stock Option a document appropriate notices setting forth such holder's rights pursuant to the IBC Stock Option Plan, the agreement evidencing such IBC Stock Option and the foregoing assumption by Parent. Parent original grant of such converted MSB Stock Option shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act continue in effect on the Closing Date with respect same terms and conditions (after giving effect to the shares of Parent Common Stock subject Consolidation pursuant to Parent Exchange Options the Agreement and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration conversion as set forth above). As of the Parent Exchange Options. For purposes Effective Time, IBC shall amend the IBC Stock Option Plan to the extent necessary to conform to, and implement, the provisions of this Section 2.4(a4.14(e), including, without limitation, amendments necessary to preserve those provisions of the “converted MSB Stock Options that are more favorable to the holders of IBC Stock Options than would otherwise be the case pursuant to the terms of the IBC Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsPlan.

Stock Options. At the Effective Time, the Target Stock Option Plan and each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company Target Common Stock under the Company Equity Plans (each, a “Company Target Stock Option”) shall vest and become fully exercisableOption Plan, whether or not then vested or subject unvested, shall be assumed by Acquiror. In addition, Target's rights to any performance condition that has not been satisfied. At repurchase shares of Target Common Stock under the Effective Time, each Company Target Stock Option Plan shall be converted into an option assigned to, and assumed by, Acquiror. Target has delivered to purchase Acquiror a schedule (the "Option Schedule") which sets forth a true and complete list as of the date hereof of all holders of outstanding options under the Target Stock Option Plan including the number of shares of Parent Target Capital Stock subject to each such option, the exercise or vesting schedule, the exercise price per share and the term of each such option. On the Closing Date, Target shall deliver to Acquiror an updated Option Schedule current as of such date. Each such option so assumed by Acquiror under this Agreement shall continue to have, and be subject to, the same terms and conditions set forth in the Target Stock Option Plan immediately prior to the Effective Time, except that (i) such option shall be exercisable for that number of whole shares of Acquiror Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Target Common Stock which could have been obtained that were issuable upon exercise of such option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option (Exchange Ratio and rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Acquiror Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after Stock, (ii) the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to per share exercise price for the shares of Parent Acquiror Common Stock subject issuable upon exercise of such assumed option shall be equal to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and quotient determined by dividing the exercise price per share of Target Common Stock at which such Parent option was exercisable immediately prior to the Effective Time by the Exchange Option Ratio, rounded up to the nearest whole cent, and (iii) each assumed option which provided for acceleration of vesting upon a change in control of Target shall not accelerate in accordance with the terms of the plan or agreement currently evidencing the assumed option but shall be determined eligible for acceleration in a manner which would not result in accordance with the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A terms of the Code, assumption agreement entered into between Acquiror and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsoptionee.

Stock Options. At On the Effective TimeDate, each then outstanding unexpired and unexercised stock option to purchase or acquire a share of Company Primary Bank Common Stock under ("Primary Bank Stock Options") pursuant to the Company Equity Plans employee and director stock option plans identified in Primary Bank Disclosure Schedules to the Reorganization Agreement (eachcollectively, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company "Primary Bank Stock Option shall be converted into an option to purchase Plans") (it being understood that the aggregate number of shares of Parent Primary Bank Common Stock subject to purchase pursuant to the exercise of such Primary Bank Stock Options is not and shall not be more than 355,523), whether vested or unvested, will be assumed by Granite State. Each Primary Bank Stock Option so assumed by Granite State under this Agreement shall continue to have, and be subject to, the same terms and conditions set forth in the Primary Bank Stock Option Plans immediately prior to the Effective Date, except that (i) such Primary Bank Stock Options shall be exercisable (when vested) for that number of whole shares of Granite State Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Primary Bank Common Stock which could have been obtained prior covered by the Primary Bank Stock Option multiplied by the Exchange Ratio, provided that any fractional share of Granite State Common Stock resulting from such multiplication shall be rounded up to the Effective Time upon nearest share; (ii) the exercise price per share of each Granite State Common Stock shall be equal to the exercise price per share of Primary Bank Common Stock of such Company Primary Bank Stock Option (Option, divided by the Exchange Ratio, provided that such exercise price shall be rounded down to the nearest whole share)cent; and (iii) that the holder of all Primary Bank Stock Options whose employment or affiliation is terminated as a result of the Merger (except termination of employment for cause) shall have two years from the Closing Date to exercise the Primary Bank Stock Options. It is the intention of the parties that the Primary Bank Options assumed by Granite State qualify following the Effective Date as incentive stock options as defined in Section 422 of the Internal Revenue Code of 1986, at an exercise price per share (rounded up as amended to the nearest cent) equal extent that the Primary Bank Options qualified as incentive stock options immediately prior to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by Effective Date. Promptly following the Stock Option Conversion FractionEffective Date, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent Granite State shall reserve for issuance the such number of shares of Parent Granite State Common Stock that will become subject as shall be necessary to Parent Exchange Options be issued pursuant to the exercise of the options assumed by Granite State pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective TimeArticle 6, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent and Granite State shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to register the shares of Parent Granite State Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment issuable in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsconnection therewith.

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to ------------- purchase or acquire a share shares of Company Common Stock under the Company Equity Plans (each, a “"Company Stock Option”") shall vest and become fully exercisableunder the Company Option Plans, whether or not then vested or vested, shall be assumed by Parent. Each Company Stock Option so assumed by Parent under this Agreement will continue to have, and be subject to, the same terms and conditions of such Company Stock Options immediately prior to any performance condition that has not been satisfied. At the Effective TimeTime (including, without limitation, any repurchase rights or vesting provisions and provisions regarding the acceleration of vesting on certain transactions, other than the transactions contemplated by this Agreement), except that (i) each Company Stock Option shall will be converted into an option to purchase the exercisable (or will become exercisable in accordance with its terms) for that number of whole shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained that were issuable upon exercise of such Company Stock Option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option (Exchange Ratio, rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that and (ii) the per share exercise price for the shares of Parent Common Stock issuable upon exercise of such assumed Company Stock Option will become be equal to the quotient determined by dividing the exercise price per share of Company Common Stock at which such Company Stock Option was exercisable immediately prior to the Effective Time by the Exchange Ratio, rounded up to the nearest whole cent. Parent shall comply with the terms of all such Company Stock Options and use its best efforts to ensure, to the extent required by and subject to the provisions of, the Company Option Plans, and to the extent permitted under the Code, that any Company Stock Options that qualified for tax treatment as incentive stock options under Section 422 of the Code prior to the Effective Time continue to so qualify after the Effective Time. Parent Exchange shall take all corporate actions necessary to reserve for issuance a sufficient number of shares of Parent Common Stock for delivery upon exercise of assumed Company Stock Options pursuant to on the terms set forth in this Section 2.4(a5.8(a). As promptly soon as reasonably practicable after the Effective Time, Parent shall issue deliver to each holder of an outstanding Parent Exchange a Company Stock Option a document evidencing the foregoing assumption of such Company Stock Option by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. At Not later than the Effective Time, each Exl Stock Option which is outstanding unexpired and unexercised immediately prior to the Effective Time pursuant to Exl's stock option to plans (other than any "stock purchase or acquire a share plan" within the meaning of Company Common Section 423 of the Code) in effect on the date hereof (the "Stock under the Company Equity Plans (each, a “Company Stock Option”Plans") shall vest become and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into represent an option to purchase the number of shares of Parent Conseco Common Stock equal (a "Substitute Option") (decreased to the product of nearest full share) determined by multiplying (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yi) the number of shares of Company Common Stock which could have been obtained subject to such Exl Stock Option immediately prior to the Effective Time upon by (ii) the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an Exchange Ratio. The exercise price per share (rounded up to of each Substitute Option shall be adjusted so that the nearest cent) equal to the aggregate exercise price for each to be paid upon exercise of such share of Company Common Stock subject to a Company Stock Substitute Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms the same as the aggregate exercise price of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company the Exl Stock Option converted pursuant to the terms this Section. Conseco shall pay cash to holders of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance Exl Stock Options in lieu of Parent Exchange Options, Parent shall reserve for issuance the number of issuing fractional shares of Parent Conseco Common Stock that will become subject to Parent Exchange upon the exercise of Substitute Options pursuant to this Section 2.4(a)for shares of Conseco Common Stock. As promptly as reasonably practicable after After the Effective Time, Parent except as provided above in this Section 2.14, each Substitute Option shall issue be exercisable upon the same terms and conditions as were applicable under the related Exl Stock Option immediately prior to each holder or at the Effective Time. Conseco and Exl shall take all necessary action to implement the provisions of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent Section 2.14 and shall file cause a registration statement on Form S-8 to be filed with the United States Securities and Exchange Commission (or any successor or other appropriate form that Parent is eligible the "SEC") within thirty days of the Effective Time to use) under the Securities Act on the Closing Date with respect to register the shares of Parent Conseco Common Stock subject to Parent Exchange be issued pursuant to the exercise of the Substitute Options and shall use its commercially reasonable efforts to cause such which registration statement to remain will be effective until upon filing with the exercise or expiration SEC under the current rules of the Parent Exchange SEC. Exl agrees that it will not grant any stock appreciation rights or limited stock appreciation rights and will not permit cash payments to holders of Exl Stock Options in lieu of the substitution therefor of Substitute Options. For purposes of , as described in this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options2.14.

Stock Options. At the Effective Time, each outstanding all unexercised and unexpired and unexercised option options to purchase or acquire a share of Company Zhone Common Stock under the Company Equity Plans (each, a “Company Stock OptionZhone Options”) shall vest and become fully exercisablethen outstanding, under any stock option plan of Zhone or any other plan, agreement or arrangement (the “Zhone Stock Option Plans”), whether or not then vested or exercisable, will be assumed by the Company. Each Zhone Option so assumed by the Company under this Agreement will continue to have, and be subject to, the same terms and conditions as set forth in the Zhone Stock Option Plan and any agreements thereunder immediately prior to any performance condition that has not been satisfied. At the Effective Time, except that (i) each Company Stock Zhone Option shall will be converted into an option to purchase the exercisable (or will become exercisable in accordance with its terms) for that number of whole shares of Parent Company Common Stock equal to the product of (x) the number of shares of Zhone Common Stock that were issuable upon exercise of such Zhone Option Conversion Fraction (as defined in this Section 2.4(a)) immediately prior to the Effective Time multiplied by (y) the Exchange Ratio, rounded down to the nearest whole number of shares of Company Common Stock which could have been obtained prior to and (ii) the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share the shares of Company Common Stock subject to a Company Stock issuable upon exercise of such Zhone Option divided by the Stock Option Conversion Fractionassumed, and all references will be equal to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption quotient determined by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and dividing the exercise price per share of Zhone Common Stock at which such Parent Zhone Option was exercisable immediately prior to the Effective Time by the Exchange Option shall be determined in a manner which would not result in Ratio, rounded to the nearest whole cent. The conversion of Company Stock any Zhone Options into Parent Exchange Options being treated as a new grant of which are incentive stock options under within the meaning of Section 409A 422 of the Code, and into options to purchase Company Common Stock shall be made so as not to constitute a “modification” of such Zhone Options within the Company and Parent meaning of Section 424 of the Code. A Zhone Employee’s continuous employment with Zhone or its Subsidiaries shall agree upon any adjustments be credited to this Section 2.4(a) necessary to avoid such new grant the optionee for purposes of stock optionsdetermining the vesting of all assumed Zhone Options after the Effective Time.

Stock Options. (a) At the Effective Time, each option granted by MBFC under the MBFC Option Plans, which is outstanding unexpired and unexercised immediately prior thereto shall cease to represent a right to acquire shares of MBFC Common Stock and shall be converted automatically into a fully-vested option to purchase or acquire a share shares of Company TSFG Common Stock under the Company Equity Plans in an amount and at an exercise price determined as provided below (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or otherwise subject to the terms of the applicable MBFC Option Plan), the agreements evidencing grants thereunder, and any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into other agreements between MBFC and an option to purchase the number of shares of Parent Common Stock equal to the product of optionee regarding MBFC Options): (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y1) the number of shares of Company TSFG Common Stock which could have been obtained prior to be subject to the Effective Time upon new option shall be equal to the exercise product of each the number of shares of MBFC Common Stock subject to the original option and the Common Exchange Ratio, provided that any fractional shares of TSFG Common Stock resulting from such Company Stock Option (multiplication shall be rounded down to the nearest whole shareshare (and .5 of a share shall be rounded up), at an ; and (2) the exercise price per share (rounded up to of TSFG Common Stock under the nearest cent) new option shall be equal to the exercise price for each such per share of Company MBFC Common Stock subject to a Company Stock Option under the original option divided by the Stock Option Conversion FractionCommon Exchange Ratio, and all references provided that such exercise price shall be rounded to the Company in each such option nearest cent (and .5 of a cent shall be deemed to refer to Parent, where appropriaterounded down). The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant (b) Prior to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange OptionsEffective Time, Parent TSFG shall reserve for issuance the number of shares of Parent TSFG Common Stock that will become subject necessary to Parent Exchange Options pursuant to satisfy TSFG's obligations under this Section 2.4(a)Section. As promptly as reasonably practicable TSFG shall file with the SEC no later than five business days after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other an appropriate form that Parent is eligible to use) under the Securities Act on of 1933, as amended (the Closing Date "Securities Act"), with respect to the shares of Parent TSFG Common Stock subject to Parent Exchange Options options to acquire TSFG Common Stock issued pursuant to this Section, and shall use its commercially reasonable best efforts to cause maintain the current status of the prospectus contained therein, as well as comply with applicable state securities or "blue sky" laws, for so long as such options remain outstanding; provided, however, that TSFG shall only be required to file and maintain the effectiveness of such registration statement with respect to remain effective until options that are eligible to be registered on a Form S-8. (c) Prior to the exercise or expiration Effective Time, TSFG and MBFC shall take all such steps as may be required to cause any acquisitions of TSFG equity securities (including derivative securities with respect to any TSFG equity securities) and dispositions of MBFC equity securities (including derivative securities with respect to any MBFC equity securities) resulting from the transactions contemplated by this Agreement by each individual who is anticipated to be subject to the reporting requirements of Section 16(a) of the Parent Exchange Options. For purposes Act with respect to TSFG or who is subject to the reporting requirements of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean 16(a) of the Exchange Ratio subject Act with respect to adjustment in accordance with Section 2.1(d). The number of shares subject MBFC, to any Parent be exempt under Rule 16b-3 promulgated under the Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsAct.

Stock Options. (a) At the Effective TimeDate, each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company TXEN Class A Common Stock pursuant to an option grant under the Company Equity Plans TXEN, Inc., 1996 Incentive Stock Option Plan or the TXEN, Inc., Key Employee Incentive Stock Option Plan (each, a “Company Stock Option”the "Option Plans") shall vest and become fully exercisablewhich are outstanding at the Effective Date (the "TXEN Options"), whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Timeexercisable, each Company Stock Option shall be converted into an option and become rights with respect to purchase NRC Common Stock, and NRC shall assume each TXEN Option, in accordance with the number terms of the Option Plan by which it is evidenced, except that from and after the Effective Date, (i) NRC and NRC's Board of Directors shall be substituted for TXEN and the Committee of TXEN's Board of Directors (including, if applicable, the entire Board of Directors of TXEN) administering such Option Plans, (ii) each TXEN Option assumed by NRC may be exercised solely for shares of Parent NRC Common Stock equal to the product of Stock, (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yiii) the number of shares of Company NRC Common Stock which could have been obtained subject to such options shall be equal to the number of shares of TXEN Common Stock subject to each such TXEN Option immediately prior to the Effective Time upon Date multiplied by .451677 (the "Exchange Ratio"), and (iv) the per share exercise of price under each such Company Stock TXEN Option (rounded down to shall be adjusted by dividing the nearest whole share), at an per share exercise price per share (rounded under each such TXEN Option by the Exchange Ratio and rounding up to the nearest cent. Notwithstanding the provisions of clause (iii) equal of the preceding sentence, NRC shall not be obligated to the exercise price for each such issue any fraction of a share of Company NRC Common Stock upon exercise of TXEN Options, and any fraction of a share of NRC Common Stock that otherwise would be subject to a Company converted TXEN Option shall represent the right to receive a cash payment upon exercise between the market value of one share of NRC Common Stock Option divided by at the time of exercise of such option and the per share exercise price of such option. The market value of one share of NRC Common Stock Option Conversion Fraction, and all references to at the Company in each such time of exercise of an option shall be deemed to refer to Parent, where appropriate. The other terms the closing price of such Company NRC Common Stock Options shall continue on the Nasdaq National Market (as reported by THE WALL STREET JOURNAL or, if not reported thereby, any other authoritative source selected by NRC) on the last trading day preceding the date of exercise. NRC and TXEN agree to apply in accordance with their terms, including pursuant take all necessary steps to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to effectuate the terms foregoing provisions of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a)5.6. As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.8

Stock Options. At (a) Prior to the Effective Time, the Company and Acquiror shall take such action as may be necessary or appropriate for Acquiror to assume or to issue a substitute option, at its option, with respect to each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company Common Stock (collectively, the "Company Stock Options") under the Company Equity Plans Company's 1997 Incentive Share Plan or 1999 --------------------- Stock Incentive Plan (eachtogether, a “the "Company Stock Option”) shall vest and become fully exercisablePlans"), whether or not then vested or subject to any performance condition so that has not been satisfied. At at the ------------------- Effective Time, Time each Company Stock Option shall will become or be converted into replaced by an option to purchase a number of whole shares of Acquiror Common Stock (an "Acquiror -------- Option") equal to the product of the Exchange Ratio and the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of ------ Company Common Stock which could have been obtained prior subject to the Effective Time upon the exercise of each such Company Stock Option Options (rounded assuming full vesting) under the Company Stock Plans (and rounding any fractional share down to the nearest whole share), at an exercise a price per share (rounded up to the nearest cent) equal to the aggregate exercise price under such Company Stock Option for each such share the shares of Company Common Stock subject to a such Company Stock Option divided by the number of whole shares of Acquiror Common Stock purchasable pursuant to such Acquiror Option; provided, -------- however, that Acquiror shall not assume the Company Stock Plans. Each ------- substituted Acquiror Option Conversion Fraction, and all references shall otherwise be subject to the same terms and conditions as apply to the related Company in Stock Option. The date of grant of each substituted Acquiror Option for purposes of such option terms and conditions shall be deemed to refer be the date on which the corresponding Company Stock Option was granted. As to Parenteach substituted Company Stock Option, where appropriateat the Effective Time Acquiror shall issue to each holder of a Company Stock Option a document evidencing the foregoing substitution by Acquiror. The other Nothing in this Section 2.04 shall affect the accelerated and complete vesting with respect to the Company Stock Options in accordance with the terms of such Company Stock Options at the Effective Time. Prior to the Effective Time, the Company shall continue have amended the Company Stock Plans (such amendment shall be substantially in the form attached hereto as Exhibit D) to apply provide that Acquiror may substitute in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat the manner --------- described in this Section 2.04(a) an Acquiror Option for each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to in accordance with the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated Plans, as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsamended.

Stock Options. At (a) As soon as practicable following the date of this Agreement, the Board of Directors of Ascend (or, if appropriate, any committee administering the Ascend Stock Plans) shall adopt such resolutions or take such other actions as may be required to effect the following: (i) adjust the terms of all outstanding Ascend Stock Options granted under Ascend Stock Plans, whether vested or unvested, as necessary to provide that, at the Effective Time, each Ascend Stock Option outstanding unexpired and unexercised option immediately prior to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option Time shall be amended and converted into an option to purchase acquire, on the same terms and conditions as were applicable under such Ascend Stock Option (as modified by the terms of an agreement (referred to in Section 3.01(k) of the Ascend Disclosure Schedule) in effect on the date hereof between Ascend and the holder of such Ascend Stock Option as disclosed to Lucent prior to the date hereof), the same number of shares of Parent Lucent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share)) as the holder of such Ascend Stock Option would have been entitled to receive pursuant to the Merger had such holder exercised such Ascend Stock Option in full immediately prior to the Effective Time, at an exercise a price per share of Lucent Common Stock (rounded up to the nearest whole cent) equal to (A) the aggregate exercise price for each such share the shares of Company Ascend Common Stock subject otherwise purchasable pursuant to a Company such Ascend Stock Option divided by (B) the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the aggregate number of shares of Parent Lucent Common Stock that will become subject to Parent Exchange Options deemed purchasable pursuant to this such Ascend Stock Option (each, as so adjusted, an "Adjusted Option"); and (ii) make such other changes to the Ascend Stock Plans as Ascend and Lucent may agree are appropriate to give effect to the Merger, including as provided in Section 2.4(a)5.07. (b) As promptly soon as reasonably practicable after the Effective Time, Parent Lucent shall issue deliver to each the holders of Ascend Stock Options appropriate notices setting forth such holders' rights pursuant to the respective Ascend Stock Plans and the agreements evidencing the grants of such Ascend Stock Options and that such Ascend Stock Options and agreements shall be assumed by Lucent and shall continue in effect on the same terms and conditions (subject to the adjustments required by this Section 5.06 after giving effect to the Merger). (c) A holder of an outstanding Parent Exchange Adjusted Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (may exercise such Adjusted Option in whole or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in part in accordance with Section 2.1(d). The number its terms by delivering a properly executed notice of shares subject exercise to any Parent Exchange Option Lucent, together with the consideration therefor and the exercise price per share of such Parent Exchange Option shall be determined federal withholding tax information, if any, required in a manner which would not result in accordance with the conversion of Company related Ascend Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsPlan.

Stock Options. At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock granted by IB under the Company Equity Plans IB Option Plan (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject unvested), which is outstanding and unexercised immediately prior thereto shall cease to represent a right to acquire shares of IB Common Stock and shall have no effect and the agreements evidencing grants of options that are unexercised thereunder, and any performance condition that has not been satisfied. At other agreements between IB and an optionee regarding IB Option shall be terminated by IB and the optionee prior to the Effective Time, and each Company Stock Option such option shall be converted converted, at the option of the option holder, into (i) the right to receive a cash payment from SAB promptly after the Effective Time in an amount equal to (a) any positive difference between the amount of $34.81 and the per share exercise price of each such stock option multiplied by (b) the number of shares subject to such stock option, or (ii) an option to purchase the number of shares of Parent SAB Common Stock, in which event SAB shall assume each such IB Option, in accordance with the terms of the applicable SAB Stock equal to Plan and stock option or other agreement by which it is evidenced, except that from and after the product Effective Time, (a) SAB and the human resources department of SAB shall be substituted for IB and the committee of the IB Board of Directors administering such IB stock option plan, (xb) the each IB Stock Option Conversion Fraction assumed by SAB may be exercised solely for shares of SAB Common Stock, (as defined in this Section 2.4(a)) multiplied by (yc) the number of shares of Company SAB Common Stock which could have been obtained subject to such IB Stock Option shall be equal to the number of shares of IB Common Stock subject to such IB Stock Option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option (Share Ratio, rounded down to the nearest whole share), at an and (d) the per share exercise price under each such IB Stock Option shall be adjusted by dividing the per share (exercise price under each such IB Stock Option by the Share Ratio, provided that such exercise price shall be rounded up to the nearest cent. Notwithstanding clauses (ii)(c) equal to and (ii)(d) of the exercise price for preceding sentence, each such share of Company Common Stock subject to a Company IB Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option which is an “incentive stock option” shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option adjusted as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this required by Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A 424 of the Code, and the Company regulations promulgated thereunder, so as not to constitute a modification, extension or renewal of the option within the meaning of Section 424(h) of the Code. SAB and Parent shall agree upon any adjustments IB agreed to take all necessary steps to effect the foregoing provisions of this Section 2.4(a) necessary 2.12. IB shall deliver to avoid SAB prior to the Effective Time a list of all option holders, and shall use its best efforts to deliver to SAB prior to the Effective Time a letter from each stating his or her election to receive cash or an option for SAB Common Stock. If IB does not deliver a letter from an option holder stating his or her election to receive cash or an option for SAB Common Stock, then such new grant of stock optionsholder shall be deemed to have elected to receive a cash payment.

Stock Options. At In addition to the Effective Timebasic compensation provided for above, each outstanding unexpired NFOX hereby grants to Consultant the right, privilege and unexercised option (the "Stock Option") to purchase 75,000 shares of the common stock $.001 par value, of NFOX (the "Option Shares"), which are to be fully vested and become exercisable immediately. The exercise price, "Option Price," of the Option Shares shall be twenty cents ($.20) per share. The Option Price shall not be adjusted upon the occurrence of a reverse stock split or acquire a share other recapitalization that effectively reduces the number of Company issued and outstanding shares of Common Stock of NFOX. The option rights granted hereby shall be cumulative. Upon becoming exercisable, the option rights shall be exercisable at any time and from time to time, in whole or in part; provided, however, that options may be exercised for no longer than five (5) years from the date on which they vest. The options shall be exercised by written notice directed to NFOX, accompanied by a check payable to NFOX in the amount of the aggregate Option Price. NFOX shall make immediate delivery of such purchased shares, fully paid and non-assessable, registered in the name of Consultant. The certificates evidencing such shares shall bear the following restrictive legend, unless and until such shares have been registered in accordance with the Securities and Exchange Act of 1933, as amended (the "Act"): THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, (THE "ACT"), OR THE SECURITIES LAWS OF ANY OTHER JURISDICTION, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED, OR OTHERWISE DISPOSED OF IN ANY MANNER UNLESS THEY ARE REGISTERED UNDER SUCH ACT AND THE SECURITIES LAWS OR ANY APPLICABLE JURISDICTIONS OR UNLESS PURSUANT TO ANY EXEMPTION THEREFROM. NFOX shall use its best efforts to register the Option Shares under the Company Equity Plans (eachAct at the earlier of such time as it registers shares issuable pursuant to a qualified employee stock option plan or such time as it registers shares beneficially owned by or issued to either or all of the following individuals: Except as otherwise provided in subparagraph 7.6, a “Company Stock Option”) shall vest If, and become fully exercisable, whether or not then vested or subject to any performance condition the extent that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product common stock of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option NFOX shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their termsincreased or reduced by whatever action, including pursuant but not limited to such preexisting terms and conditionschange of par value, providedsplit up, howeverreclassification, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to distribution or a dividend payable in stock, or the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a)like, the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange the Stock Option and the exercise option price per share shall be proportionately adjusted. If NFOX is reorganized or consolidated or merged with another corporation, Consultant shall be entitled to receive options covering shares of such Parent Exchange Option shall be determined in a manner which would not result reorganized, consolidated, or merged company in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A same proportion, at an equivalent price, and subject to the same conditions. For purposes of the Codepreceding sentence, the excess of the aggregate fair market value of the shares subject to the option immediately after any such reorganization, consolidation, or merger over the aggregate option price of such shares shall not be more than the excess of the aggregate fair market value of all shares subject to the Stock Option immediately before such reorganization, consolidation, or merger over the aggregate option price of such shares, and the Company new option or assumption of the old Stock Option shall not give Consultant additional benefits which he did not have under the old Stock Option, or deprive him of benefits which he had under the old Stock Option. Further, nothing contained herein shall prevent NFOX from effectuating a split or reverse split of the shares of NFOX. Consultant shall have no rights as a stockholder with respect to the Option Shares until exercise of the Stock Option and Parent payment of the Option Price as herein provided. In the event that NFOX enters into an agreement for its merger with another entity or for the sale or transfer of the business assets or Capital Stock of NFOX, whereby causing the dissolution of NFOX as a Corporation, NFOX shall agree upon any adjustments provide reasonable advance notice of the consummation of such transaction (but in no event less than thirty (30) days prior to this Section 2.4(asuch consummation) necessary to avoid such new grant Consultant, and Consultant's Option Shares, pursuant to subparagraph 7.6, shall fully vest, giving the Consultant the right to purchase the entire amount of stock optionsOption Shares at the "Option Price".

Stock Options. At The parties acknowledge that the Effective Time, each outstanding unexpired and unexercised option Compensation Committee of the Board of Directors of WTI (the “Compensation Committee”) granted to you (i) options to purchase or acquire a share shares of Company Common Stock WTI’s common stock under the Company WTI’s 2005 Performance Equity Plans (each, a “Company Stock Option”) shall vest Plan and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At terms of the Effective Time, each Company associated Stock Option shall be converted into an option Agreement dated January 26, 2009 and (ii) options to purchase the number of shares of Parent Common Stock equal WTI’s common stock outside of any of WTI’s equity plans but subject to the product terms of (x) the Stock Option Conversion Fraction Agreement dated January 28, 2010 (collectively, the “Options”). The Options are subject to the terms and conditions of the Stock Option Agreements, provided however, and notwithstanding anything to the contrary in the Stock Option Agreements, (A) in the event that a termination of your employment by the Company without Cause or a resignation from your employment for Good Reason occurs at any time other than during the Notice Period (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole shareParagraph 6 below), at an exercise price per share (rounded up to the nearest centi) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option you shall be deemed entitled to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date accelerated vesting only with respect to the portion of the Options, if any, that would have vested during the 12-month period immediately following the date of termination (“Post-Employment Period”); (ii) vesting shall otherwise cease as of the last day of your employment but the non-vested shares of Parent Common Stock subject to Parent Exchange Options underlying the Option will not expire and shall use its commercially reasonable efforts to cause such registration statement to remain effective the Option will not terminate until the exercise or expiration last day of the Parent Exchange Options. For purposes Post-Employment Period; and (iii) if a Change in Control (as defined in the Stock Option Agreement) occurs during the Post-Employment Period, you shall be entitled to the same vesting with respect to the Options as you would have if you had been employed on the date of this Section 2.4(athe Change in Control; and (B) in the event that a termination of your employment by the Company without Cause or a resignation from your employment for Good Reason occurs during the Notice Period (as defined in Paragraph 6 below), (i) you shall be entitled to accelerated vesting only with respect to the portion of the Options, if any, that would have vested during the six-month period immediately following the date of termination (“Reduced Post-Employment Period”); (ii) vesting shall otherwise cease as of the last day of your employment but the non-vested shares underlying the Option will not expire and the Option will not terminate until the last day of the Reduced Post-Employment Period; and (iii) if a Change in Control (as defined in the Stock Option Conversion Fraction” shall mean Agreement) occurs during the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option Reduced Post-Employment Period, you shall be determined in a manner which entitled to the same vesting with respect to the Options as you would not result in have if you had been employed on the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A date of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsChange in Control.

Stock Options. At Prior to the Effective Time, each holder of an outstanding unexpired and unexercised option Schuxx Xxxck Option (as defined in Section 4.3) to purchase shares of Schuxx Xxxmon Stock, shall have either (a) exercised such options (so long as such option is vested and exercisable at such time) or acquire (b) agreed to the amendment of such options in the manner described in the following sentence. The Schuxx Xxxck Options outstanding as of the Effective Time shall be amended such that Oakwood shall be substituted for Schuxx xx a share of Company Common Stock under party thereto and shall continue to have, and be subject to, the Company Equity Plans (each, a “Company Stock Option”) shall vest same terms and become fully exercisable, whether or not then vested or subject conditions as set forth in the stock option plans and agreements pursuant to any performance condition that has not been satisfied. At which such Schuxx Xxxck Options were issued as in effect immediately prior to the Effective Time, except that (a) each Company Stock Schuxx Xxxck Option shall be converted into an option to purchase the exercisable for that number of whole shares of Parent Oakwood Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Schuxx Xxxmon Stock which could have been obtained covered by such Schuxx Xxxck Option immediately prior to the Effective Time upon multiplied by the exercise fraction obtained by dividing $22.50 by the closing price of each such Company Oakwood Common Stock Option on the New York Stock Exchange on the date hereof (the "Exchange Ratio") and rounded down up to the nearest whole share), number of shares of Oakwood Common Stock and (b) the price at an which each such Schuxx Xxxck Option is exercisable shall be equal to the exercise price per share (of the Schuxx Xxxck Option immediately prior to the Effective Time divided by the Exchange Ratio and rounded up to the nearest cent. Oakwood shall (i) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the aggregate number of shares of Parent Oakwood Common Stock that will become subject to Parent Exchange issuable upon the exercise of such Schuxx Xxxck Options pursuant to this Section 2.4(a). As promptly 3.2 and (ii) as reasonably soon as practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-3 or Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date form), as determined by Oakwood, with respect to the shares of Parent Oakwood Common Stock subject to Parent Exchange Options such options and shall use its commercially reasonable efforts to cause maintain the effectiveness of such registration statement to remain effective until (and maintain the exercise or expiration current status of the Parent Exchange Optionsprospectus or prospectuses contained therein) for so long as such options remain outstanding. Nothing in this Section 3.2 shall affect the schedule of vesting with respect to the Schuxx Xxxck Options to be assumed by Oakwood. For purposes of this Section 2.4(a)each outstanding Schuxx Xxxck Option, Schedule 3.2 sets forth the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option of Schuxx Xxxmon Stock for which such option is exercisable and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionswith respect thereto.

Stock Options. At Seller believes that the Effective Time, each outstanding unexpired Acquired Business is capable of producing higher revenues and unexercised option to purchase or acquire a share of Company Common Stock under greater profitability than has been achieved by the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon Closing Date. Therefore, in further consideration of the exercise Stock sold by Seller to Purchaser pursuant to this Agreement and, without regard to the continuing employment status of Willxx, Xxhnxxx xxx Browx xx Purchaser or its affiliates, Seller shall be entitled to receive from Monarch options to purchase shares of Monarch's Common Stock as described herein (which shall be allocated equally among the Sellers). Subject to the provisions of this Section 3.2, Seller shall be entitled to receive from Monarch options to purchase up to an aggregate of 40,000 shares of Monarch Common Stock (based on the total shares of Monarch Common Stock outstanding as of April 28, 1997) as set forth in the matrix attached as Exhibit B. Such options will be granted ratably following the end of each of the first five (5) calendar years following the date of Closing, commencing with the period January 1, 1998 through December 31, 1998 (each such Company Stock Option (rounded down period being referred to as an "Earnout Period") subject to the nearest whole shareachievement of the performance goals based on annual revenue and EBITDA over each of such five (5) calendar years as set forth in the matrix attached as Exhibit B. For this purpose, revenues mean, for the applicable Earnout Period, the gross revenues of the Acquired Business which shall be determined in accordance with generally accepted accounting principles, consistently applied, excluding capital or extraordinary gains or losses and any gain or loss from sales of investments, receivables, goodwill or agreements not to compete. Options granted hereunder, if any, shall be granted pursuant to Monarch's 1996 Equity Acquisition Option Plan (the "Plan"), and shall be subject to all limitations of such Plan, including the aggregate number of options which may be granted thereunder. Any options granted pursuant to this Section 3.2 shall be at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share IPO Price of Company Monarch Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriateStock. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options granted pursuant to this Section 2.4(a3.2 shall be fully vested on the date of grant and shall expire ten (10) years from the date of grant. Monarch shall grant the options to Seller for the applicable Earnout Period pursuant to this Section 3.2 on or before the one hundred twentieth (120th) day following the end of each of the applicable Earnout Periods. Options not earned by Seller during each applicable Earnout Period(s) shall not be available for grant to Seller in a subsequent Earnout Period. The items in the attached matrix (Exhibit B) shall be determined from Purchaser's financial records for the applicable Earnout Period and set forth in a statement (the "Statement"), represented by Purchaser that such Statement was prepared in accordance with this Agreement and generally accepted accounting principles. As promptly as reasonably practicable A copy of such Statement shall be delivered to Seller not later than forty-five (45) days after the Effective Timeend of each Earnout Period. Such Statements may be reviewed for accuracy by the accountants employed by Seller. If within thirty (30) days after delivery of the Statement to Seller, Parent Browx (xx any other representative designated by Seller in writing to Purchaser), on behalf of Seller, has not given written notice to Monarch disputing such Statement and stating the basis of such dispute, Monarch shall issue thereafter have no further liability to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible grant options to use) under the Securities Act on the Closing Date Seller with respect to that Earnout Period except as set forth in such Statement. If Monarch receives notice disputing the shares of Parent Common Stock subject to Parent Exchange Options Statement within such thirty (30) day period, Seller's accountants and Purchaser's auditors shall use its commercially reasonable their best efforts to cause settle the dispute within ninety (90) days after the giving of such registration statement dispute notice. If Purchaser's auditors and the accountants representing Seller are unable to remain effective until resolve the exercise or expiration of dispute within the Parent Exchange Options. For purposes of this Section 2.4(a)ninety (90)-day period, the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option dispute shall be determined in a manner which would not result in the conversion submitted to an independent firm of Company Stock Options into Parent Exchange Options being treated as a new grant certified public accountants of stock options under Section 409A of the Coderecognized national standing, reasonably satisfactory to Monarch and the Company and Parent Seller, whose decision on such dispute shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsbe binding on all parties.

Stock Options. At the Effective Time, each the Company Stock Options, whether vested or unvested, will be assumed by PCA ("ASSUMED STOCK OPTIONS"). Section 2.2 of the Company Disclosure Schedule (as defined in Article III) sets forth a true and complete list as of the date hereof of all holders of outstanding unexpired and unexercised option options to purchase or acquire a share shares of Company Common Stock under the Company Equity Plans (each"COMPANY STOCK OPTIONS"), a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) including the number of shares of Company Common Stock which could have been obtained subject to each such option, the exercise or vesting schedule, the exercise price per share and the term of each such option. On the Closing Date, the Company shall deliver to PCA an updated Section 2.2 of the Company Disclosure Schedule (as defined in Article III) current as of such date. Each such option so assumed by PCA under this Agreement shall continue to have, and be subject to, the same terms and conditions set forth in the Company Stock Option Plan ("COMPANY OPTION PLAN") and any other document governing such option immediately prior to the Effective Time upon the exercise Time, except that (a) such option will be exercisable for that number of each such Company whole shares of PCA Common Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share one and one-half (1.5) times that number of shares of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each that were issuable upon exercise of such option shall be deemed immediately prior to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing (b) the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to per share exercise price for the shares of Parent PCA Common Stock subject issuable upon exercise of such assumed option will be equal to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of Company Common Stock at which such Parent option was exercisable immediately prior to the Effective Time divided by the Exchange Ratio and rounded up to the nearest whole cent (the "ADJUSTED EXERCISE PRICE") and (c) any restriction on the exercisability of such Company Stock Option shall continue in full force and effect, and the term, exercisability, vesting schedule and other provisions of such Company Stock Option shall remain unchanged. If the foregoing calculation of the Adjusted Exercise Price results in an Assumed Stock Option being exercised for a fraction of a share of PCA Common Stock, then the number of shares of PCA Common Stock subject to that option will be determined in a manner which would not result rounded to the nearest whole number of shares of PCA Common Stock (rounded down, in the conversion case of the Company Stock Options into Parent Exchange that are Incentive Stock Options being treated as a new grant of stock options under Section 409A 422 of the Code). Continuous employment with the Company shall be credited to an optionee of the Company for purposes of vesting of the Assumed Stock Option. Consistent with the terms of the Company Option Plan and the documents governing the outstanding options, the Merger will not terminate any of the outstanding options under the Company Option Plan or accelerate the exercisability or vesting of such options or the shares of PCA Common Stock which will be subject to those options upon PCA's assumption of the options in the Merger. It is the intention of the parties that the options so assumed by PCA following the Effective Time will remain incentive stock options as defined in Section 422 of the Code to the extent such options qualified as incentive stock options prior to the Effective Time, and the parties hereto shall use their commercially reasonable efforts to carry out such intention. Within ten (10) business days after the Effective Time, PCA will issue to each person who, immediately prior to the Effective Time was a holder of an outstanding option under the Company Option Plan, a document in form and Parent shall agree upon any adjustments substance reasonably satisfactory to this Section 2.4(a) necessary to avoid the Company evidencing the foregoing assumption of such new grant of stock optionsoption by PCA.

Stock Options. At As of the Effective Time, (1) each outstanding unexpired and unexercised option to purchase or acquire a share Infinop Shares listed on Section 4(b) of Company Common Stock under the Company Equity Plans DISCLOSURE SCHEDULE (each, a “Company Stock Option”AN "INFINOP STOCK OPTION") shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option SHALL BE CONVERTED INTO AN OPTION (AN "ADJUSTED OPTION") to purchase the number of shares of Parent Common Stock Vianet Shares equal to the product number of (x) the Infinop Shares subject to such Infinop Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option Conversion Ratio (rounded down to the nearest whole sharenumber of Vianet Shares), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock Infinop Share subject to a Company Stock Option such option divided by the Stock Option Conversion FractionRatio, and all references in each SUCH OPTION TO INFINOP SHALL BE DEEMED TO REFER TO VIANET, WHERE APPROPRIATE; PROVIDED, HOWEVER, that the adjustments provided in this clause with respect to any options which are "incentive stock options" (as defined in Section 422 of the Code) or which are described in Section 423 of the Code, shall be affected in a manner consistent with the requirements of Section 424(a) of the Code, and (2) Vianet shall assume the obligations of Infinop under the Infinop Stock Options and the Infinop 1998 Stock Option Plan (the "INFINOP STOCK OPTION PLAN") and stock option agreements between Infinop and the individuals listed on Section 4(b)(b) of the Disclosure SCHEDULE (THE "INFINOP STOCK OPTION AGREEMENTS"). For purposes of this Section 2(d) (viii), the Conversion Ratio shall be adjusted if Adjustment Escrow Shares (as defined below) are delivered to Vianet as a result of a reduction in the Merger Consideration pursuant to Section 2(d)(x) such that the Conversion Ratio will equal the actual rate at which Infinop Shares are converted into Vianet Shares in the Merger after giving effect to the Company in each full dollar amount of such option shall be deemed to refer to Parent, where appropriatereduction. The other terms of such Company each Adjusted Option, and the Infinop Stock Options Option Plan and Infinop Stock Option Agreements shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent . The date of grant of each Adjusted Option shall treat each Company be the date on which the corresponding Infinop Stock Option as fully vested and exercisablewas granted. Each Company Vianet agrees that the Infinop Stock Option converted Plan shall be amended, to the extent necessary, to reflect the transactions contemplated by this Agreement, including, but not limited, to the conversion of Infinop Shares held or to be awarded or paid pursuant to the terms of this Section 2.4(a) shall be referred to as Infinop Stock Option Plan and the Infinop Stock Option Agreements into Vianet Shares on a “Parent Exchange Option.” In connection basis consistent with the issuance of Parent Exchange Options, Parent transactions contemplated by this Agreement. Vianet shall (x) reserve for issuance the number of shares of Parent Common Stock Vianet Shares that will become subject to Parent Exchange Options the Infinop Stock Option Plan and the Infinop Stock Option Agreements referred to in this clause and (y) issue or cause to be issued the appropriate number of Vianet Shares pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Infinop Stock Option Plan and the Infinop Stock Option Agreements upon the exercise or maturation of rights existing thereunder at the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.

Stock Options. (a) At the Effective Time, the Target Stock Option Plans and each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company Target Common Stock under the Company Equity Plans (each, a “Company Target Stock Option”) shall vest and become fully exercisableOption Plans, whether or not then vested or subject unvested, shall be assumed by Acquiror. Target has delivered to any performance condition that has not been satisfied. At Acquiror a schedule which is attached hereto as Schedule 5.16 (the Effective Time, each Company "Option Schedule") which sets forth a true and complete list as of the date hereof of all holders of outstanding options under the Target Stock Option shall be converted into an option to purchase Plans including the number of shares of Parent Target Capital Stock subject to each such option, the exercise or vesting schedule, the exercise price per share and the term of each such option. On the Closing Date, Target shall deliver to Acquiror an updated Option Schedule current as of such date. Each such option so assumed by Acquiror under this Agreement shall continue to have, and be subject to, the same terms and conditions set forth in the Target Stock Option Plans immediately prior to the Effective Time, except that (i) such option shall be exercisable for that number of whole shares of Acquiror Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Target Common Stock which could have been obtained that were issuable upon exercise of such option immediately prior to the Effective Time upon multiplied by the exercise of each such Company Stock Option (Common Exchange Ratio and rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Acquiror Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after Stock, and (ii) the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to per share exercise price for the shares of Parent Acquiror Common Stock subject issuable upon exercise of such assumed option shall be equal to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and quotient determined by dividing the exercise price per share of Target Common Stock at which such Parent option was exercisable immediately prior to the Effective Time by the Common Exchange Option shall be determined in a manner which would not result in Ratio, rounded up to the conversion nearest whole cent. It is the intention of Company Stock Options into Parent Exchange Options being treated the parties that the options so assumed by Acquiror qualify following the Effective Time as a new grant of incentive stock options under as defined in Section 409A 422 of the CodeCode to the extent such options qualified as incentive stock options prior to the Effective Time. Within five (5) business days after the Effective Time, Acquiror will issue to each person who, immediately prior to the Effective Time was a holder of an outstanding option under the Target Stock Option Plans a document in form and substance satisfactory to Target evidencing the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid foregoing assumption of such new grant of stock optionsoption by Acquiror.

Stock Options. At (a) First Data and Western Union shall take any and all action as shall be necessary or appropriate, including without limitation, approval of the Effective Timeprovisions of this Article V by the Western Union Board of Directors and the Compensation Committee of the First Data Board of Directors, each outstanding unexpired so that options issued under the First Data Corporation 1992 Long Term Incentive Plan, the 2002 First Data Corporation Long Term Incentive Plan, the First Data Corporation 1993 Director’s Stock Option Plan, the Concord EFS, Inc. 1993 Incentive Stock Option Plan, the Concord EFS, Inc. 2002 Stock Option Plan, and unexercised option the Star Systems, Inc. 2000 Equity Incentive Plan (collectively, the “First Data LTIPs”) to purchase or acquire a share of Company First Data Common Stock (“First Data Stock Options”) held at the close of business on the Distribution Date by current and former employees and directors of First Data and its Subsidiaries and Affiliates who will not be Transferred Employees and Business Employees whose employment terminated prior to the Distribution Date (or their respective transferees) shall be replaced pursuant to the terms of the First Data LTIPs with an adjusted First Data Stock Option with an adjusted exercise price and a substitute option issued under The Western Union Company 2006 Long Term Incentive Plan or The Western Union Company 2006 Non-Employee Directors’ Equity Plan (collectively the Company Equity Plans “Western Union LTIPs”) to purchase Western Union Common Stock (each, a “Company Western Union Stock Option”). Such replacement will be implemented in a manner such that immediately following the Distribution (i) shall vest and become fully exercisable, whether or not then vested or subject the number of shares relating to any performance condition that has not been satisfied. At the Effective Time, each Company adjusted First Data Stock Option shall will be converted into an option equal to purchase the number of shares of Parent First Data Common Stock equal subject to such option immediately prior to the product of Distribution, (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yii) the number of shares of Company Common Stock which could have been obtained prior subject to the Effective Time upon the exercise of each such Company substitute Western Union Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) will be equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Western Union Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each option holder of an outstanding Parent Exchange Option a document evidencing would have received in the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under Distribution had the Securities Act on the Closing Date with respect to the shares of Parent First Data Common Stock subject to Parent Exchange Options the option represented outstanding shares of First Data Common Stock, and shall use its commercially reasonable efforts to cause such registration statement to remain effective until (iii) the per share option exercise or expiration price of the Parent Exchange Options. For purposes of this Section 2.4(a), the “original First Data Stock Option Conversion Fraction” shall mean will be proportionally allocated between such separate stock options based upon the Exchange Ratio relative per share trading prices of First Data Common Stock and Western Union Common Stock immediately following the Distribution, with the intention that such adjustment and substitution satisfy the requirements of Section 424 of the Code and avoid treatment as non-qualified deferred compensation subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code. Each adjusted First Data Option and substituted Western Union Option adjusted from or substituted for an original First Data Option described in this Section 5.01(a), when combined, will in the exclusive and sole discretion of the Compensation Committee of the First Data Board of Directors preserve the intrinsic value of such original First Data Option, and each will preserve the Company and Parent ratio from the original option of the exercise price to the fair market value of the stock subject to the option. Fractional shares shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant be adjusted or compensated by First Data as appropriate in the sole discretion of stock optionsthe Compensation Committee of the First Data Board of Directors.

Stock Options. (a) At the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share shares of Company Common Stock under the that is then outstanding, whether vested or unvested (a "Company Equity Plans Option"), (each, a “Company Stock Option”i) shall vest remain outstanding following the Effective Time and become fully exercisable-------------- shall, whether by virtue of the Merger and without any further action on the part of Parent, Company, Sub or not then vested or subject the holder of such Company Option, be assumed by Parent in accordance with the terms (as in effect as of the date of this Agreement and without regard to any performance condition that has not been satisfied. At provisions thereof which permit modification to such terms by the Effective Time, Board of Directors of Company or Parent) of the Company's 2001 Stock Incentive Plan (the "Stock Plan") and each stock option agreement by which such ---------- Company Stock Option is evidenced and (ii) shall be converted into become and represent an option to purchase the a number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yA) the number of shares of Company Common Stock which could have been obtained purchasable under the Company Option immediately prior to the Effective Time upon multiplied by (B) the exercise of each such Company Stock Option Exchange Ratio (rounded down to the nearest whole sharenumber of shares), at an exercise a price per share (rounded up to the nearest whole cent) equal to (A) the aggregate exercise price for each the shares purchasable pursuant to such share Company Option immediately prior to the Effective Time divided by (B) the number of Company full shares of Parent Common Stock subject deemed purchasable pursuant to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply Option in accordance with their termsthe foregoing. After the Effective Time, except as provided above in this Section and subject to paragraph (b) below, each assumed Company Option shall be exercisable upon the same terms and conditions as were applicable under the Company Option at the Effective Time, including pursuant the terms set forth in the Stock Plan and the applicable stock option agreement providing for further adjustment as appropriate to such preexisting terms and conditionsreflect any stock split, providedreverse stock split, howeverstock dividend, that recapitalization or similar transaction effected by the Parent after the Effective Time. Parent shall treat each take all corporate action necessary to reserve for issuance a sufficient number of Parent Common Stock for delivery upon exercise of Company Stock Option as fully vested Options. The Company and exercisable. Each Company Stock Option converted pursuant Parent shall take on or before the Effective Time all necessary action to implement or to provide for implementation of the terms provision of this Section 2.4(a2.04. Within ten (10) shall be referred to as a “Parent Exchange Option.” In connection with days following the issuance of Parent Exchange OptionsClosing, Parent shall reserve for issuance will send to each holder of an assumed Company Option a written notice setting forth (i) the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange assumed Company Option and (ii) the exercise price per share of Parent Common Stock issuable upon exercise of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of assumed Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsOption.

Stock Options. At The Company hereby acknowledges that the Board of Directors of the Company has authorized the Company to negotiate and to enter into a written Consulting Agreement with Employee (the "Consulting Agreement") for the period commencing on April __, 1996 and terminating on the Effective TimeDate (the "Consulting Period"), each outstanding unexpired pursuant to which Employee shall provide specified financial consulting, business development, and unexercised option non-tax accounting services to the Company, and for which services the Employee shall be compensated solely with the granting of options (the "Options") to purchase or acquire a share an aggregate of Company Common Stock under the Company Equity Plans Fifty Thousand (each, a “Company Stock Option”50,000) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent common stock of the Company, $.01 par value (the "Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole shareStock"), at an exercise price per share (rounded up to the nearest cent) equal to the exercise fair market value of such shares on the date upon which the Consulting Agreement is entered into by the Company and Employee, with fair market value being based upon the last sales price for each such of a share of Company Common Stock subject on such date as reported by The Nasdaq National Market. By his execution of this Agreement, Employee agrees to a use his best efforts, in good faith, to negotiate and execute the Consulting Agreement. The Company Stock Option divided by does hereby acknowledge that Employee shall be entitled to receive cash compensation from the Stock Option Conversion FractionCompany, and all references in addition to the Options, in connection with his provision of additional services to the Company in each such option during the Consulting Period, principally tax accounting and other tax related services, which are not covered by the Consulting Agreement. The Options shall be deemed to refer to Parentexercisable five (5) year period from the date of grant, where appropriateand shall be exercisable in full immediately. The other terms of such Company Stock Options shall continue does hereby agree to apply in accordance use its good faith reasonable efforts to file with their terms, including pursuant to such preexisting terms the Securities and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant Exchange Commission prior to the terms end of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file Consulting Period a registration statement on Form S-8 (or any successor or other appropriate form in order to register the distribution to Employee of the shares of Common Stock underlying the Options; and the Company does hereby further agree that Parent is eligible to use) under the Securities Act on the Closing Date extent that it fails to file such a registration it will grant to Employee "piggyback" registration rights with respect to the shares of Parent Common Stock subject underlying the Options. Employee acknowledges that unless the distribution to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration Employee of the Parent shares of Common Stock underlying the Option is registered with the Securities and Exchange Options. For purposes Commission, when issued upon Option exercise such shares will constitute "restricted securities" (within the meaning of this Section 2.4(athe Securities Act of 1933, as amended), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall can not be determined in a manner which would not result transferred by Employee in the conversion absence of Company Stock Options into Parent Exchange Options being treated as a new grant subsequent registration or the existence of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments an exemption from registration applicable to this Section 2.4(a) necessary to avoid such new grant of stock optionstheir distribution.

Stock Options. At or prior to the Effective Time, each outstanding unexpired Parent and unexercised option the Company shall take all action necessary to cause the assumption by Parent as of the Effective Time of the options, warrants or other rights to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisableoutstanding, whether or not then vested or subject to any performance condition that has not been satisfied. At unvested, as of the Effective Time, each Company Stock Option Time (the "OUTSTANDING OPTIONS"). Each of the Outstanding Options shall be converted without any action on the part of the holder thereof into an option to purchase shares of Parent Common Stock as of the Effective Time. The number of shares of Parent Common Stock equal that the holder of an assumed Outstanding Option shall be entitled to receive upon the exercise of such option shall be a number of shares (rounded down to the product of (xnearest whole number) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied determined by (y) multiplying the number of shares of Company Common Stock which could have been obtained prior subject to such option, determined immediately before the Effective Time upon Time, by the exercise Conversion Ratio. The option price of each such Company share of Parent Common Stock subject to an assumed Outstanding Option (rounded down to shall be the nearest whole share), at an exercise price per share amount (rounded up to the nearest whole cent) equal to obtained by dividing the exercise price for each such per share of Company Common Stock subject to a Company Stock Option divided at which such option is exercisable immediately before the Effective Time by the Stock Option Conversion Fraction, and all references Ratio applicable to the Company in each such option shall be deemed to refer to Parent, where appropriateShares. The other terms assumption and substitution of Outstanding Options as provided herein shall not give the holders of such Company Stock Options shall continue options additional benefits which they did not have immediately prior to apply in accordance with the Effective Time or relieve the holders of any obligations or restrictions applicable to their terms, including pursuant to such preexisting terms and conditions, provided, however, that options or the shares obtainable upon exercise of the options. Parent shall treat each Company (i) reserve out of its authorized but unissued shares of Common Stock Option sufficient shares to provide for the exercise of the Outstanding Options and (ii) use all commercially reasonable efforts to register under the Securities Act, as fully vested promptly as practicable after the Effective Time and exercisable. Each Company Stock Option converted pursuant to in no event later than seven (7) days after the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange OptionsEffective Time, Parent shall reserve for issuance the number of those shares of Parent Common Stock that will become subject to Parent Exchange be issued upon the exercise of the Outstanding Options pursuant for a period up to this Section 2.4(a). As promptly as reasonably practicable after and ending on the Effective Timefirst date by which all Outstanding Options have been fully exercised, Parent which registration shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file initially be effective under a registration statement on Form S-8 (or any successor or such other appropriate form that Parent is eligible to use) as may be permitted under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsAct.

Stock Options. At Pursuant to the AES China Generating Ltd. Incentive Stock Option Plan (the "Chigen Option Plan"), all outstanding options issued thereunder (the "Chigen Options") shall, as of the Effective Time, each outstanding unexpired automatically and unexercised option to purchase or acquire a share without any action on the part of Company the holder thereof, shall become options for AES Common Stock under in accordance with the Company Equity Plans (eachformulae set forth in this Section. AES shall assume the Chigen Option Plan as of the Effective Time. The holders of such Options shall continue to have, a “Company Stock Option”) shall vest and become fully exercisablebe subject to, whether or not then vested or subject the same terms and conditions set forth in the Chigen Option Plan and agreements pursuant to any performance condition that has not been satisfied. At which such Chigen Options were issued as in effect immediately prior to the Effective Time, each Company Stock except that, in accordance with Section 7.01 of the Chigen Option Plan, (i) such Chigen Options shall be converted into an option to purchase the exercisable for that number of whole shares of Parent AES Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Class B Common Stock which could have been obtained covered by the Chigen Option immediately prior to the Effective Time multiplied by the Exchange Ratio rounded up to the nearest whole number of shares of AES Common Stock, and (ii) the per share exercise price for the shares of AES Common Stock issuable upon the exercise of each such Company assumed Chigen Option shall be equal to the quotient determined by dividing the exercise price per share of Class B Common Stock specified for such Chigen Option (rounded under the Chigen Option Plan or agreement in effect immediately prior to the Effective Time by the Exchange Ratio rounding the resulting exercise price down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price . The date of grant for each such share of Company Common Stock subject to a Company Stock Chigen Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parentthe date on which the Chigen Option was originally granted. At the Effective Time, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent AES shall reserve for issuance the number of shares of Parent AES Common Stock that will become subject to Parent Exchange issuable upon the exercise of such Chigen Options pursuant to this Section 2.4(a)2.05. Nothing in this Section 2.05 shall affect the schedule of vesting (or the acceleration thereof) with respect to the Chigen Options to be assumed by AES as provided in this Section 2.05. As promptly soon as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent AES shall file a registration statement or registration statements on Form S-8 (or any successor form), or other another appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent AES Common Stock subject to Parent Exchange Options such Chigen Options, and shall use its commercially reasonable best efforts to cause maintain the effectiveness of such registration statement to remain effective until or registration statements (and maintain the exercise or expiration current status of the Parent Exchange Optionsprospectus contained therein) for so long as such Chigen Options remain outstanding. For purposes It is the intention of the parties that, subject to applicable law, the Chigen Options assumed by AES qualify following the Effective Time as "incentive stock options" (as defined in Section 422 of the Code) to the extent that the Chigen Options qualified as incentive stock options prior to the Effective Time and, accordingly, the provisions of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option 2.05 shall be determined in a manner which would not result in deemed amended to the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A extent necessary to maintain such status of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsChigen Options.

Stock Options. At Prior to the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”) shall vest and become fully exercisable, whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and Cxxxx shall use its commercially reasonable efforts to cause provide that each option to purchase Cxxxx Shares granted under Cxxxx’x 1997 Employee, Director and Consultant Stock Option Plan and its 2005 Stock Plan (in each case, a “Cxxxx Option”) outstanding at the Effective Time which is vested (in each case, a “Vested Cxxxx Option”) shall entitle each holder thereof to receive a payment in cash from the Surviving Corporation, upon the Effective Time, equal to the product of (i) the number of Cxxxx Shares previously subject to such registration statement to remain effective until Vested Cxxxx Option and (ii) the excess, if any, of the Merger Consideration over the exercise or price per Cxxxx Share previously subject to such Vested Cxxxx Option. All applicable withholding taxes attributable to the payments made hereunder shall be deducted from the amounts payable hereunder; provided, however, that with respect to any person subject to Section 16 of the Exchange Act, 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. Cxxxx shall, upon the request of any holder of Vested Cxxxx Options, permit such holder to execute and deliver to Cxxxx, prior to the expiration of the Parent Exchange OptionsOffer, an agreement substantially in the form of Annex B (an “Option Election”) under which such holder would agree, contingent upon the purchase of Cxxxx Shares by Acquisition Subsidiary pursuant to the Offer, to cause, immediately prior to the expiration of the Offer, such Vested Cxxxx Options to be exercised and the Cxxxx Shares issued as a result of that exercise to be tendered in the Offer. For purposes Cxxxx and Acquisition Subsidiary shall reflect on their books and records the transactions effected pursuant to the Option Elections. At the Effective Time, (A) each Cxxxx Option (whether vested or not) outstanding immediately prior to the Effective Time with an exercise price per share that is less than the applicable Merger Consideration for the class of this Section 2.4(a)Cxxxx Shares into which such Cxxxx Option is exercisable shall be cancelled by Cxxxx in exchange for the right to receive, without interest, a cash amount equal to the “Stock Option Conversion Fraction” shall mean product of (1) the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number excess, if any, of shares subject to any Parent Exchange Option and (x) such Merger Consideration, over (y) the exercise price per share of such Parent Exchange Cxxxx Option multiplied by (2) the total number of Cxxxx Shares subject to such Cxxxx Option (such product, as applied to Cxxxx Options referred to as “Option Consideration”); (B) each Cxxxx Option (whether vested or not) outstanding as of the Effective Time with an exercise price per share that is equal to or greater than the applicable Merger Consideration for the class of Cxxxx Shares into which such Cxxxx Option is exercisable shall be determined in terminated, without any consideration therefor; and (C) the Board of Directors of Cxxxx shall take any actions necessary to effect the transactions anticipated by this Section 2.5(e) under its 1997 Employee, Director and Consultant Stock Option Plan and its 2005 Stock Plan and all Cxxxx Option agreements and any other plan or arrangement of Cxxxx (whether written or oral, formal or informal). As soon as practicable following the date hereof, Cxxxx shall deliver or cause to be delivered to each holder of a manner which would not result in Cxxxx Option any certifications, notices or other communications required by the conversion terms of Company Stock Options such Cxxxx Option or any agreement entered into Parent Exchange Options being treated as a new grant of stock options under Section 409A of with respect thereto to be delivered to such holder prior to the Code, Effective Time and the Company and Parent shall agree upon any adjustments to other transactions contemplated by this Section 2.4(a) necessary to avoid such new grant of stock optionsAgreement.

Stock Options. At the Effective Time, each Each stock option issued and outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the 1993 Stock Option Plan, as amended, of the Company Equity Plans (eachthe "STOCK OPTION PLAN") is referred to herein as an "EMPLOYEE/ DIRECTOR STOCK OPTION" and all such options are referred to herein, collectively, as the "EMPLOYEE/ DIRECTOR STOCK OPTIONS." Each stock option issued and outstanding under the 1993 Directors' Stock Option Plan (the "DIRECTORS' STOCK OPTION PLAN") is referred to herein as a “Company "DIRECTOR'S OPTION" and all such options are referred to herein, collectively, as the "DIRECTORS' OPTIONS." The Employee/Director Stock Option”) shall vest Options and become fully exercisablethe Directors' Options are referred to herein, whether or not then vested or subject to any performance condition that has not been satisfied. collectively, as the "COMPANY OPTIONS" and, individually, as a "COMPANY OPTION." At the Effective Time, each Company Stock Option shall become immediately fully vested and shall be converted into an option to purchase shares of Parent Common Stock, as provided below. Following the Effective Time, each such Company Option shall be exercisable upon the same terms and conditions as then are applicable to such Company Option, except that (i) each such Company Option shall be exercisable for that number of shares of Parent Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock for which could have been obtained such Company Option was exercisable immediately prior to the Effective Time upon Date and (y) the Stock Exchange Ratio and (ii) the exercise price of each such Company Stock Option (rounded down option shall be equal to the nearest whole share), at an quotient obtained by dividing the exercise price per share (rounded up of such Company Option by the Stock Exchange Ratio. From and after the date of this Agreement, no additional options to the nearest cent) equal to the exercise price for each such share purchase shares of Company Common Stock subject to a shall be granted under the Company Stock Option divided Plan, Directors' Stock Option Plan or otherwise. Except as otherwise agreed to by the Stock Option Conversion Fractionparties, and all references to no person shall have any right under any stock option plan (or any option granted thereunder) or other plan, program or arrangement of the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their termsrespect to, including pursuant any right to such preexisting terms and conditionsacquire, provided, however, that Parent shall treat each equity securities of the Company Stock Option following the Effective Time. At or as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to soon as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of a Company Option that is canceled an outstanding agreement that accurately reflects the terms of the Parent Exchange Option a document evidencing the foregoing assumption substituted therefore as contemplated by Parentthis Section 2.7. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible i) take all corporate actions necessary to use) under the Securities Act on the Closing Date with respect to the reserve for issuance such number of shares of Parent Common Stock subject as will be necessary to satisfy exercises in full of all Parent Exchange Options and shall after the Effective Time, (ii) use its commercially reasonable best efforts to cause ensure that an effective Registration Statement on Form S-8 is on file with the Securities and Exchange Commission (the "SEC") with respect to such registration statement Parent Common Stock, and (iii) use its reasonable best efforts to remain effective until the exercise or expiration have such shares admitted to trading upon exercises of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.ARTICLE III

Stock Options. At (a) Pursuant to amendments effected in accordance with Section 9.03 hereof, all options (the Effective Time, each outstanding unexpired and unexercised option to purchase or acquire a share of Company Common Stock under the Company Equity Plans (each, a “Company Stock Option”"IVAX OPTIONS") shall vest and become fully exercisableoutstanding, whether or not then exercisable and whether or not vested at the Effective Time under IVAX's 1994 Stock Option Plan or subject to 1985 Stock Option Plan or any performance condition that has not been satisfiedplans assumed by IVAX in connection with any acquisition, business combination or similar transaction (collectively, the "IVAX STOCK OPTION PLANS"), shall remain outstanding following the Effective Time. At the Effective Time, the IVAX Options shall, by virtue of the Merger and without any further action on the part of IVAX or the holder thereof, be assumed by IVAX NYCOMED in such manner that IVAX NYCOMED (i) is a corporation "assuming a stock option in a transaction to which Section 424(a) applied" within the meaning of Section 424 of the Code or (ii) to the extent that Section 424 of the Code does not apply to any such IVAX Options, would be such a corporation were Section 424 of the Code applicable to such IVAX Options. From and after the Effective Time, all references to IVAX in the IVAX Stock Option Plans, Employee Savings Plan and the applicable stock option agreements issued thereunder shall be deemed to refer to IVAX NYCOMED, which shall have assumed the IVAX Stock Option Plans as of the Effective Time by virtue of this Agreement and without any further action. Each IVAX Option assumed by IVAX NYCOMED (each Company a "SUBSTITUTE OPTION") shall be exercisable upon the same terms and conditions as under the applicable IVAX Stock Option Plan and the applicable option agreement issued thereunder, except that (A) each such Substitute Option shall be converted into an option exercisable for, and represent the right to purchase the acquire, that whole number of shares of Parent IVAX NYCOMED Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded up or down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent IVAX Common Stock subject to Parent such IVAX Option multiplied by the Merger Exchange Options Ratio; and shall use its commercially reasonable efforts to cause such registration statement to remain effective until (B) the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise option price per share of such Parent Exchange Option IVAX NYCOMED Common Stock shall be determined an amount equal to the option price per share of IVAX Common Stock subject to such IVAX Option in a manner effect immediately prior to the Effective Time divided by the Merger Exchange Ratio (the option price per share, as so determined, being rounded upward to the nearest full cent). Notwithstanding anything in this Section 2.09 or in Section 9.03 to the contrary, any specified treatment of the IVAX Options which would not result in shall be inconsistent with accounting for the conversion of Company Stock Options into Parent Exchange Options being treated Transactions as a new grant "pooling of stock options under Section 409A of interests" for financial accounting purposes shall be modified to the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) extent necessary to avoid make such new grant treatment consistent with "pooling of stock optionsinterests" accounting treatment.

Stock Options. At (a) Each grantee under any of the Effective TimeMII Legacy Equity Plans (i) who is a B&W Legacy Award Holder or will be a B&W Employee, or who will not be a B&W Employee but will serve on the board of directors of B&W and not on the board of directors of MII immediately after the Distribution Date, and (ii) who holds as of the Distribution Date, one or more MII Options, shall receive, as a replacement award in substitution for each outstanding unexpired and unexercised such MII Option (which shall be cancelled), an option to purchase or acquire a share number of Company shares of B&W Common Stock under the Company B&W New Equity Plans Plan (each, a “Company Stock Replacement B&W Option”) shall vest and become fully exercisable, whether or not then vested or having a value (calculated using the Post-Distribution B&W Share Price) equal to the value of the MII Common Stock subject to any performance condition that has not been satisfiedthe MII Option (calculated using the Pre-Distribution MII Share Price), as calculated pursuant to the following provisions. At the Effective Time, each Company Stock Option shall be converted into an option to purchase the The number of shares of Parent B&W Common Stock subject to a Replacement B&W Option shall be equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (yi) the number of shares of Company Common Stock which could have been obtained prior to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company MII Common Stock subject to an MII Option as of the Distribution Date and (ii) a Company Stock fraction, the numerator of which is the Pre-Distribution MII Share Price and the denominator of which is the Post-Distribution MII Share Price. Each such Replacement B&W Option divided by shall have the Stock Option Conversion Fraction, and all references same comparative ratio of the exercise price to the Company in Post-Distribution B&W Share Price as the exercise price of each such option MII Option to the Pre-Distribution MII Share Price. B&W shall be deemed to refer to Parent, where appropriate. The other terms responsible for (i) the satisfaction of such Company Stock all tax reporting and withholding requirements in respect of the exercise of Replacement B&W Options shall continue to apply issued in accordance with their termsthis Section 3.4(a) and (ii) remitting the appropriate tax or withholding amounts to the appropriate taxing authorities. Replacement B&W Options shall not be exercisable until the Registration Statement Effectiveness Date. Except as provided in the foregoing provisions of this Section 3.4(a), Replacement B&W Options granted under this Section 3.4(a) shall be granted on terms which are in all material respects identical (including pursuant with respect to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant vesting) to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange MII Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsthey replace.

Stock Options. (a) At the Effective Time, each issued and outstanding unexpired and unexercised option to purchase or acquire a share of Company Foglight Common Stock under the Company Equity Plans (each, a “Company "Foglight Stock Option”") shall vest under (i) the Foglight 1998 Stock Option Plan (the "Foglight Option Plan") and become fully exercisable(ii) the Option Agreement dated January 13, 1999, reflecting the right to purchase up to 5,289 shares of Foglight Common Stock, will be assumed by Quest, whether or not then vested or unvested. Each Foglight Stock Option so assumed by Quest shall continue to have, and be subject to, the same terms and conditions set forth in the agreement evidencing such option immediately prior to any performance condition that has not been satisfied. At the Effective Time, each Company except that (i) such Foglight Stock Option shall be converted into an option to purchase the exercisable (when vested) solely and exclusively for that number of whole shares of Parent Quest Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company Foglight Common Stock which could have been obtained that were issuable upon the exercise of the Foglight Stock Option immediately prior to the Effective Time upon Time, multiplied by the exercise of each such Company Stock Option (Exchange Ratio and rounded down to the nearest whole share)number of shares of Quest Common Stock, at an (ii) the per share exercise price payable upon the exercise of such assumed Foglight Stock Option shall be equal to the quotient determined by dividing the exercise price per share (of Foglight Common Stock in effect under the Foglight Stock Option immediately prior to the Effective Time by the Exchange Ratio, rounded up to the nearest whole cent, and (iii) equal there shall be no right to receive any cash payments or other cash consideration upon the exercise of the assumed Foglight Stock Option. Unless otherwise agreed to in writing by Quest, there shall be no acceleration of the vesting of any Foglight Stock Option that is assumed in connection with this Section 5.12. Quest shall make such assumption in such manner that (i) Quest 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 or (ii) to the exercise price for each extent that Section 424 of the Code does not apply to such share Foglight Stock Option, Quest would be such a corporation were Section 424 of Company Common the Code applicable to such Foglight Stock subject to a Company Stock Option divided by Option; and, after the Stock Option Conversion FractionEffective Time, and all references to Foglight in any Foglight Option Plan and the Company in each such applicable stock option agreements shall be deemed to refer to Parent, where appropriate. The other terms Quest as issuer and Quest as the employer of such Company the holders of Foglight Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the number of shares of Parent Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock optionsapplicable.

Stock Options. At the Effective Time, each the outstanding unexpired and unexercised option options to purchase or acquire a share an aggregate of up to 3,545,662 shares of Company Common Stock (each a "Stock Option") granted under the Company Equity Plans Company's 1995 Stock Plan (each, a “the "Company Stock Option”) shall vest and become fully exercisablePlan"), whether or not then vested or subject to any performance condition that has not been satisfied. At the Effective Timeunvested, each Company Stock Option shall be converted into deemed assumed by the Parent and deemed to constitute an option to purchase acquire, on the same terms and conditions as were applicable under such Stock Option prior to the Effective Time (including terms and conditions relating to such Stock Option's term, exercisability, vesting schedule and status as an "incentive stock option" under Section 422 of the Code), the number (rounded down to the nearest whole number) of shares of Parent Common Stock equal to the product aggregate of that number of shares of Parent Common Stock (based on the Exchange Ratio) as the holder of such Stock Option would have been entitled to receive pursuant to the Merger had such holder exercised such Option in full immediately prior to the Effective Time (not taking into account whether or not such Option was in fact exercisable). The exercise price for such Stock Options shall be the price per share equal to (x) the aggregate exercise price for Company Common Stock otherwise purchasable pursuant to such Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied divided by (y) the number of shares of Company Parent Common Stock which could have been obtained prior deemed purchasable pursuant to the Effective Time upon the exercise of each such Company Stock Option (rounded down to the nearest whole share), at an exercise price per share (share, so determined, being rounded up to the nearest full cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option ). No payment shall be deemed to refer to Parent, where appropriatemade for fractional shares. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the aggregate number of shares of Parent Common Stock that will become subject to issuable upon the exercise of Options assumed by Parent Exchange Options pursuant to this Section 2.4(a). As promptly 2.2(c) shall be referred to in this Agreement as reasonably practicable after the Effective Time, Parent shall issue "Option Shares." Any adjustment to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) incentive stock option made under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” 2.2(c) shall mean the Exchange Ratio subject to adjustment in accordance comply with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange Option shall be determined in a manner which would not result in the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A 424(a) of the Code, and the Company and Parent shall agree upon any adjustments . The Parent's assumption of each Stock Option pursuant to this Section 2.4(a2.2(c) necessary shall be subject to avoid the holder of such new grant Stock Option executing and delivering to the Parent the Stock Option Assumption Agreement in the form of stock optionsExhibit I hereto providing that ten percent (10%) of the Option Shares subject to such Stock Option will be deposited in escrow as security for the indemnification obligations of the Holders under Article XI hereof.

Stock Options. At As of the Effective Time, each outstanding unexpired and unexercised stock option to purchase or acquire a share shares of Company MYR Common Stock under the Company Equity Plans (each, a “Company an "MYR Stock Option”") shall, by virtue of the Merger and without any action on the part of the holder thereof, entitle the holder thereof to receive in settlement of the exercisable portion thereof a cash payment from MYR in an amount (the "Option Cash-Out Amount"), if any, equal to the product of (i) the excess of the Merger Consideration over the per share exercise price of such MYR Stock Option, and (ii) the total number of shares of MYR Common Stock which the holder of such MYR Stock Option is entitled to purchase under such portion of the MYR Stock Option (whereupon such portion of the MYR Stock Option shall vest and become fully exercisablebe canceled). Each MYR Stock Option, whether or portion thereof, that is not then vested or subject to any performance condition that has not been satisfied. At exercisable at the Effective Time, shall be canceled as of such time and the holder thereof shall become entitled to receive on the date such MYR Stock Option, or portion thereof, otherwise would have become exercisable a cash payment from MYR in an amount equal to the Option Cash-Out Amount. GPU agrees to make cash in an amount equal to the aggregate Option Cash-Out Amount available to MYR as required to enable MYR to honor its obligations under this Section 2.1.3. Notwithstanding the foregoing, subject to the receipt of any required regulatory approvals, within 20 business days after the Effective Time each Company holder of an MYR Stock Option may elect in writing, in lieu of the cash settlement set forth in the first two sentences of this Section 2.1.3, to have any of such outstanding MYR Stock Options assumed by GPU, which assumed MYR Stock Options shall continue to have, and be subject to, the same terms and conditions set forth in the stock option plans and agreements pursuant to which the MYR Stock Options were issued as in effect immediately prior to the Effective Time, except that (a) such assumed MYR Stock Options shall be converted into an option to purchase the exercisable for that number of whole shares of Parent GPU Common Stock equal to the product of (x) the Stock Option Conversion Fraction (as defined in this Section 2.4(a)) multiplied by (y) the number of shares of Company MYR Common Stock which could have been obtained covered by the assumed MYR Stock Option immediately prior to the Effective Time upon multiplied by the exercise number (the "Exchange Ratio") determined by dividing the Merger Consideration by the average closing price of each such Company GPU Common Stock Option for the five (rounded down to 5) trading days immediately preceding the nearest whole share)Effective Time, at an exercise price per share (rounded up to the nearest cent) equal to the exercise price for each such share of Company Common Stock subject to a Company Stock Option divided by the Stock Option Conversion Fraction, and all references to the Company in each such option shall be deemed to refer to Parent, where appropriate. The other terms of such Company Stock Options shall continue to apply in accordance with their terms, including pursuant to such preexisting terms and conditions, provided, however, that Parent shall treat each Company Stock Option as fully vested and exercisable. Each Company Stock Option converted pursuant to the terms of this Section 2.4(a) shall be referred to as a “Parent Exchange Option.” In connection with the issuance of Parent Exchange Options, Parent shall reserve for issuance the whole number of shares of Parent GPU Common Stock, (b) the per share exercise price for the GPU Common Stock that will become subject to Parent Exchange Options pursuant to this Section 2.4(a). As promptly as reasonably practicable after the Effective Time, Parent shall issue to each holder of an outstanding Parent Exchange Option a document evidencing the foregoing assumption by Parent. Parent shall file a registration statement on Form S-8 (or any successor or other appropriate form that Parent is eligible to use) under the Securities Act on the Closing Date with respect to the shares of Parent Common Stock subject to Parent Exchange Options and shall use its commercially reasonable efforts to cause such registration statement to remain effective until issuable upon the exercise or expiration of the Parent Exchange Options. For purposes of this Section 2.4(a), the “Stock Option Conversion Fraction” shall mean the Exchange Ratio subject to adjustment in accordance with Section 2.1(d). The number of shares subject to any Parent Exchange Option and the exercise price per share of such Parent Exchange assumed MYR Stock Option shall be determined in a manner which would not result in equal to the conversion of Company Stock Options into Parent Exchange Options being treated as a new grant of stock options under Section 409A of the Code, and the Company and Parent shall agree upon any adjustments to this Section 2.4(a) necessary to avoid such new grant of stock options.quotient