Exhibit 10.31

 

FORM OF MANAGEMENT STOCKHOLDER’S AGREEMENT

 

This Management Stockholder’s Agreement (this “Agreement”) is entered into as of
                    , 200   (the “Effective Date”) between Visant Holding Corp.
(formerly known as Jostens Holding Corp.), a Delaware corporation (the
“Company”), and the undersigned person (the “Management Stockholder”) (the
Company and the Management Stockholder being hereinafter collectively referred
to as the “Parties”).  All capitalized terms not immediately defined are
hereinafter defined in Section 7(b) of this Agreement or in the Option Plan (as
such term is defined below).

 

WHEREAS, pursuant to the Contribution Agreement, dated as of July 21, 2004 (the
“Contribution Agreement”), between the Company and Fusion Acquisition LLC, a
Delaware limited liability company (“Fusion”), (the Closing thereunder having
occurred on October 4, 2004), Fusion has received in exchange for the
contribution (the “Contribution”) of the capital stock of AHC I Acquisition
Corporation and Von Hoffmann Holdings Inc. (i) 2,664,356 shares of the Company’s
Class A common stock, par value $0.01 per share (the “Class A Common Stock”),
representing, as of the date hereof, 44.85% of the issued and outstanding shares
of the Company’s Common Stock (as defined below) and (ii) one share of the
Company’s Class C Common Stock, par value $0.01 per share (the “Class C Common
Stock” and together with the Class A Common Stock, the “Common Stock”) initially
representing 4.8% of the voting securities of the Company (the date of such
Contribution, the “Closing Date);

 

WHEREAS, as of the date hereof, DLJ Merchant Banking Partners III, L.P., DLJ
Offshore Partners III-1, C.V., DLJ Offshore Partners III-2, C.V., DLJ Offshore
Partners III, C.V., DLJ MB Partners III GmbH & Co. KG, Millennium Partners II,
L.P. and MBP III Plan Investors, L.P. (collectively, the “DLJMB Funds” and
together with Fusion, the “Investors”) beneficially own 2,664,357 shares of the
Class A Common Stock, representing, as of the date hereof, 44.85% of the issued
and outstanding shares of the Company’s Common Stock;

 

WHEREAS, in connection with the Contribution, the Management Stockholder has
been selected by the Company to be permitted to contribute to the Company cash
in exchange for shares of Class A Common Stock;

 

WHEREAS, the Management Stockholder has been selected by the Company, as of the
date hereof, to receive an option to purchase shares of Class A Common Stock
(the “Option”) pursuant to the terms set forth below and the terms of the
Amended and Restated 2004 Stock Option Plan for Key Employees of the Company and
Its Subsidiaries (the “Option Plan”) and the Stock Option Agreement dated as of
the date hereof, entered into by and between the Company and the Management
Stockholder (the “Stock Option Agreement”); and

 

WHEREAS, this Agreement is one of several other agreements (“Other Management
Stockholders’ Agreements”) which in the future will be entered into between the
Company and other individuals who are or will be key employees of the Company or
one of its subsidiaries (collectively, the “Other Management Stockholders”).

 

NOW THEREFORE, to implement the foregoing and in consideration of the grant of
Options and of the mutual agreements contained herein, the Parties agree as
follows:

 

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1.                                       ISSUANCE OF PURCHASED STOCK; OPTIONS

 

(A)                                  SUBJECT TO THE TERMS AND CONDITIONS
HEREINAFTER SET FORTH, THE MANAGEMENT STOCKHOLDER HEREBY SUBSCRIBES FOR AND
SHALL PURCHASE, AS OF THE EFFECTIVE DATE, AND THE COMPANY SHALL ISSUE AND
DELIVER TO THE MANAGEMENT STOCKHOLDER AS OF THE EFFECTIVE DATE, [     ] SHARES
OF CLASS A COMMON STOCK, AT A PER SHARE PURCHASE PRICE OF $96.10401 (THE “BASE
PRICE”), WHICH PRICE IS EQUAL TO THE EFFECTIVE PER SHARE PURCHASE PRICE PAID BY
FUSION FOR THE SHARES OF THE COMPANY (ALL SUCH SHARES ACQUIRED BY THE MANAGEMENT
STOCKHOLDER, THE “PURCHASED STOCK”).  THE AGGREGATE PURCHASE PRICE FOR ALL
SHARES OF THE PURCHASED STOCK IS $[     ].

 

(B)                                 SUBJECT TO THE TERMS AND CONDITIONS
HEREINAFTER SET FORTH AND AS SET FORTH IN THE OPTION PLAN, AS OF THE EFFECTIVE
DATE THE COMPANY IS ISSUING TO THE MANAGEMENT STOCKHOLDER AN OPTION TO ACQUIRE
SHARES OF CLASS A COMMON STOCK, AT AN INITIAL EXERCISE PRICE EQUAL TO THE BASE
PRICE, AND THE PARTIES SHALL EXECUTE AND DELIVER TO EACH OTHER COPIES OF THE
STOCK OPTION AGREEMENT CONCURRENTLY WITH THE ISSUANCE OF THE OPTION.

 

(C)                                  THE COMPANY SHALL HAVE NO OBLIGATION TO
SELL ANY PURCHASED STOCK TO ANY PERSON WHO (I) IS A RESIDENT OR CITIZEN OF A
STATE OR OTHER JURISDICTION IN WHICH THE SALE OF THE COMMON STOCK TO HIM OR HER
WOULD CONSTITUTE A VIOLATION OF THE SECURITIES OR “BLUE SKY” LAWS OF SUCH
JURISDICTION OR (II) IS NOT AN EMPLOYEE OF THE COMPANY OR ANY OF ITS
SUBSIDIARIES ON THE DATE HEREOF.

 

2.                                       MANAGEMENT STOCKHOLDER’S
REPRESENTATIONS, WARRANTIES AND AGREEMENTS.

 

(A)                                  THE MANAGEMENT STOCKHOLDER AGREES AND
ACKNOWLEDGES THAT HE WILL NOT, DIRECTLY OR INDIRECTLY, OFFER, TRANSFER, SELL,
ASSIGN, PLEDGE, HYPOTHECATE OR OTHERWISE DISPOSE OF (ANY OF THE FOREGOING ACTS
BEING REFERRED TO HEREIN AS A “TRANSFER”) ANY SHARES OF PURCHASED STOCK AND, AT
THE TIME OF EXERCISE, THE COMMON STOCK ISSUABLE UPON EXERCISE OF THE OPTIONS
(“OPTION STOCK”; TOGETHER WITH ALL PURCHASED STOCK AND ANY OTHER COMMON STOCK
OTHERWISE ACQUIRED AND/OR HELD BY THE MANAGEMENT STOCKHOLDER ENTITIES, “STOCK”),
EXCEPT AS OTHERWISE PROVIDED FOR HEREIN.  IF THE MANAGEMENT STOCKHOLDER IS A
RULE 405 AFFILIATE, THE MANAGEMENT STOCKHOLDER ALSO AGREES AND ACKNOWLEDGES THAT
HE WILL NOT TRANSFER ANY SHARES OF THE STOCK UNLESS:

 

(I)  THE TRANSFER IS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS IN EFFECT
THEREUNDER (THE “ACT”), AND IN COMPLIANCE WITH APPLICABLE PROVISIONS OF STATE
SECURITIES LAWS; OR

 

(II)  (A) COUNSEL FOR THE MANAGEMENT STOCKHOLDER (WHICH COUNSEL SHALL BE
REASONABLY ACCEPTABLE TO THE COMPANY) SHALL HAVE FURNISHED THE COMPANY WITH AN
OPINION, REASONABLY SATISFACTORY IN FORM AND SUBSTANCE TO THE COMPANY, THAT NO
SUCH REGISTRATION IS REQUIRED BECAUSE OF THE AVAILABILITY OF AN EXEMPTION FROM
REGISTRATION UNDER THE ACT AND (B) IF THE MANAGEMENT STOCKHOLDER IS A CITIZEN OR
RESIDENT OF ANY COUNTRY OTHER THAN THE UNITED STATES, OR THE MANAGEMENT
STOCKHOLDER DESIRES TO EFFECT ANY TRANSFER IN ANY SUCH COUNTRY, COUNSEL FOR THE
MANAGEMENT STOCKHOLDER (WHICH COUNSEL SHALL BE REASONABLY SATISFACTORY TO THE
COMPANY) SHALL HAVE FURNISHED THE COMPANY WITH AN OPINION OR OTHER ADVICE
REASONABLY SATISFACTORY IN FORM AND SUBSTANCE

 

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TO THE COMPANY TO THE EFFECT THAT SUCH TRANSFER WILL COMPLY WITH THE SECURITIES
LAWS OF SUCH JURISDICTION.

 

Notwithstanding the foregoing, the Company acknowledges and agrees that any of
the following transfers are deemed to be in compliance with the Act and this
Agreement (including without limitation any restrictions or prohibitions herein)
and no opinion of counsel is required in connection therewith: (x) a transfer
made pursuant to Section 3, 4, 5, 6 or 9 hereof, (y) a transfer upon the death
or Permanent Disability of the Management Stockholder to the Management
Stockholder’s Estate or a transfer to the executors, administrators,
testamentary trustees, legatees or beneficiaries of a person who has become a
holder of Stock in accordance with the terms of this Agreement; provided that it
is expressly understood that any such transferee shall be bound by the
provisions of this Agreement, and (z) a transfer made after the Effective Date
in compliance with the federal securities laws to a Management Stockholder’s
Trust, provided that such transfer is made expressly subject to this Agreement
and that the transferee agrees in writing to be bound by the terms and
conditions hereof.

 

(B)                                 THE CERTIFICATE (OR CERTIFICATES)
REPRESENTING THE STOCK SHALL BEAR THE FOLLOWING LEGEND:

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED, SOLD,
ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS SUCH TRANSFER,
SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION COMPLIES WITH THE
PROVISIONS OF THE MANAGEMENT STOCKHOLDER’S AGREEMENT DATED AS OF              
       , 2005 BETWEEN VISANT HOLDING CORP. (THE “COMPANY”) AND THE MANAGEMENT
STOCKHOLDER NAMED ON THE FACE HEREOF (A COPY OF WHICH IS ON FILE WITH THE
SECRETARY OF THE COMPANY).”

 

(C)                                  THE MANAGEMENT STOCKHOLDER ACKNOWLEDGES
THAT HE HAS BEEN ADVISED THAT (I) A RESTRICTIVE LEGEND IN THE FORM HERETOFORE
SET FORTH SHALL BE PLACED ON THE CERTIFICATES REPRESENTING THE STOCK AND (II) A
NOTATION SHALL BE MADE IN THE APPROPRIATE RECORDS OF THE COMPANY INDICATING THAT
THE STOCK IS SUBJECT TO RESTRICTIONS ON TRANSFER AND APPROPRIATE STOP TRANSFER
RESTRICTIONS WILL BE ISSUED TO THE COMPANY’S TRANSFER AGENT WITH RESPECT TO THE
STOCK.  IF THE MANAGEMENT STOCKHOLDER IS A RULE 405 AFFILIATE, THE MANAGEMENT
STOCKHOLDER ALSO ACKNOWLEDGES THAT (1) THE STOCK MUST BE HELD INDEFINITELY AND
THE MANAGEMENT STOCKHOLDER MUST CONTINUE TO BEAR THE ECONOMIC RISK OF THE
INVESTMENT IN THE STOCK UNLESS IT IS SUBSEQUENTLY REGISTERED UNDER THE ACT OR AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE, (2) WHEN AND IF SHARES OF THE
STOCK MAY BE DISPOSED OF WITHOUT REGISTRATION IN RELIANCE ON RULE 144 OF THE
RULES AND REGULATIONS PROMULGATED UNDER THE ACT, SUCH DISPOSITION CAN BE MADE
ONLY IN LIMITED AMOUNTS IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF SUCH RULE
AND (3) IF THE RULE 144 EXEMPTION IS NOT AVAILABLE, PUBLIC SALE WITHOUT
REGISTRATION WILL REQUIRE COMPLIANCE WITH SOME OTHER EXEMPTION UNDER THE ACT.

 

(D)                                 IF ANY SHARES OF THE STOCK ARE TO BE
DISPOSED OF IN ACCORDANCE WITH RULE 144 UNDER THE ACT OR OTHERWISE, THE
MANAGEMENT STOCKHOLDER SHALL PROMPTLY NOTIFY THE

 

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COMPANY OF SUCH INTENDED DISPOSITION AND SHALL DELIVER TO THE COMPANY AT OR
PRIOR TO THE TIME OF SUCH DISPOSITION SUCH DOCUMENTATION AS THE COMPANY MAY
REASONABLY REQUEST IN CONNECTION WITH SUCH SALE AND, IN THE CASE OF A
DISPOSITION PURSUANT TO RULE 144, SHALL DELIVER TO THE COMPANY AN EXECUTED COPY
OF ANY NOTICE ON FORM 144 REQUIRED TO BE FILED WITH THE SEC.

 

(E)                                  THE MANAGEMENT STOCKHOLDER AGREES THAT, IF
ANY SHARES OF THE STOCK ARE OFFERED TO THE PUBLIC PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT (OTHER THAN REGISTRATION OF SECURITIES
ISSUED ON FORM S-8, S-4 OR ANY SUCCESSOR OR SIMILAR FORM), THE MANAGEMENT
STOCKHOLDER WILL NOT EFFECT ANY PUBLIC SALE OR DISTRIBUTION OF ANY SHARES OF THE
STOCK NOT COVERED BY SUCH REGISTRATION STATEMENT FROM THE TIME OF THE RECEIPT OF
A NOTICE FROM THE COMPANY THAT THE COMPANY HAS FILED OR IMMINENTLY INTENDS TO
FILE SUCH REGISTRATION STATEMENT TO, OR WITHIN 180 DAYS (OR SUCH SHORTER PERIOD
AS MAY BE CONSENTED TO BY THE MANAGING UNDERWRITER OR UNDERWRITERS) IN THE CASE
OF THE INITIAL PUBLIC OFFERING AND NINETY (90) DAYS (OR IN AN UNDERWRITTEN
OFFERING SUCH SHORTER PERIOD AS MAY BE CONSENTED TO BY THE MANAGING UNDERWRITER
OR UNDERWRITERS, IF ANY) IN THE CASE OF ANY OTHER PUBLIC OFFERING AFTER, THE
EFFECTIVE DATE OF SUCH REGISTRATION STATEMENT, UNLESS OTHERWISE AGREED TO IN
WRITING BY THE COMPANY.

 

(F)                                    THE MANAGEMENT STOCKHOLDER REPRESENTS AND
WARRANTS THAT (I) WITH RESPECT TO THE STOCK, HE HAS RECEIVED AND REVIEWED THE
AVAILABLE INFORMATION RELATING TO THE STOCK, INCLUDING HAVING RECEIVED AND
REVIEWED THE DOCUMENTS RELATED THERETO, CERTAIN OF WHICH DOCUMENTS SET FORTH THE
RIGHTS, PREFERENCES AND RESTRICTIONS RELATING TO THE OPTIONS AND THE STOCK
UNDERLYING THE OPTIONS AND (II) HE HAS BEEN GIVEN THE OPPORTUNITY TO OBTAIN ANY
ADDITIONAL INFORMATION OR DOCUMENTS AND TO ASK QUESTIONS AND RECEIVE ANSWERS
ABOUT SUCH INFORMATION, THE COMPANY AND THE BUSINESS AND PROSPECTS OF THE
COMPANY WHICH HE DEEMS NECESSARY TO EVALUATE THE MERITS AND RISKS RELATED TO HIS
INVESTMENT IN THE STOCK AND TO VERIFY THE INFORMATION CONTAINED IN THE
INFORMATION RECEIVED AS INDICATED IN THIS SECTION 2(F), AND HE HAS RELIED SOLELY
ON SUCH INFORMATION.

 

(G)                                 THE MANAGEMENT STOCKHOLDER FURTHER
REPRESENTS AND WARRANTS THAT (I) HIS FINANCIAL CONDITION IS SUCH THAT HE CAN
AFFORD TO BEAR THE ECONOMIC RISK OF HOLDING THE STOCK FOR AN INDEFINITE PERIOD
OF TIME AND HAS ADEQUATE MEANS FOR PROVIDING FOR HIS CURRENT NEEDS AND PERSONAL
CONTINGENCIES, (II) HE CAN AFFORD TO SUFFER A COMPLETE LOSS OF HIS OR HER
INVESTMENT IN THE STOCK, (III) HE UNDERSTANDS AND HAS TAKEN COGNIZANCE OF ALL
RISK FACTORS RELATED TO THE PURCHASE OF THE STOCK AND (IV) HIS KNOWLEDGE AND
EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS ARE SUCH THAT HE IS CAPABLE OF
EVALUATING THE MERITS AND RISKS OF HIS PURCHASE OF THE STOCK AS CONTEMPLATED BY
THIS AGREEMENT.

 

3.                                       TRANSFERABILITY OF STOCK.  THE
MANAGEMENT STOCKHOLDER AGREES THAT HE WILL NOT TRANSFER ANY SHARES OF THE STOCK
AT ANY TIME DURING THE PERIOD COMMENCING ON THE EFFECTIVE DATE AND ENDING ON THE
FIFTH ANNIVERSARY OF THE EFFECTIVE DATE; PROVIDED, HOWEVER, THAT THE MANAGEMENT
STOCKHOLDER MAY TRANSFER SHARES OF STOCK DURING SUCH TIME PURSUANT TO ONE OF THE
FOLLOWING EXCEPTIONS: (A) TRANSFERS PERMITTED BY SECTION 5 OR 6; (B) TRANSFERS
PERMITTED BY CLAUSES (Y) AND (Z) OF SECTION 2(A); (C) A SALE OF SHARES OF COMMON
STOCK PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT FILED BY THE
COMPANY, INCLUDING WITHOUT LIMITATION A SALE PURSUANT TO SECTION 9 (EXCLUDING
ANY REGISTRATION ON FORM S-8, S-4 OR ANY SUCCESSOR OR SIMILAR FORM);
(D) TRANSFERS PERMITTED PURSUANT TO THE SALE PARTICIPATION AGREEMENT (AS DEFINED
IN SECTION 7); OR (E) TRANSFERS PERMITTED BY THE BOARD.  NO TRANSFER OF ANY SUCH
SHARES IN VIOLATION

 

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HEREOF SHALL BE MADE OR RECORDED ON THE BOOKS OF THE COMPANY AND ANY SUCH
TRANSFER SHALL BE VOID AB INITIO AND OF NO EFFECT.

 

4.                                       RIGHT OF FIRST REFUSAL.  (A)  IF, AT
ANY TIME AFTER THE FIFTH ANNIVERSARY OF THE EFFECTIVE DATE AND PRIOR TO THE DATE
OF CONSUMMATION OF A QUALIFIED PUBLIC OFFERING, THE MANAGEMENT STOCKHOLDER
RECEIVES A BONA FIDE OFFER TO PURCHASE ANY OR ALL OF HIS STOCK (THE “THIRD PARTY
OFFER”) FROM A THIRD PARTY (WHICH, FOR THE AVOIDANCE OF DOUBT, SHALL NOT INCLUDE
ANY TRANSFERS PURSUANT TO CLAUSES (Y) AND (Z) OF SECTION 2(A)) (THE “OFFEROR”),
WHICH THE MANAGEMENT STOCKHOLDER WISHES TO ACCEPT, THE MANAGEMENT STOCKHOLDER
SHALL CAUSE THE THIRD PARTY OFFER TO BE REDUCED TO WRITING AND SHALL NOTIFY THE
COMPANY IN WRITING OF HIS WISH TO ACCEPT THE THIRD PARTY OFFER.  THE MANAGEMENT
STOCKHOLDER’S NOTICE TO THE COMPANY SHALL CONTAIN AN IRREVOCABLE OFFER TO SELL
SUCH STOCK TO THE COMPANY (IN THE MANNER SET FORTH BELOW) AT A PURCHASE PRICE
EQUAL TO THE PRICE CONTAINED IN, AND ON THE SAME TERMS AND CONDITIONS OF, THE
THIRD PARTY OFFER, AND SHALL BE ACCOMPANIED BY A COPY OF THE THIRD PARTY OFFER
(WHICH SHALL IDENTIFY THE OFFEROR).  AT ANY TIME WITHIN FIFTEEN (15) DAYS AFTER
THE DATE OF THE RECEIPT BY THE COMPANY OF THE MANAGEMENT STOCKHOLDER’S NOTICE,
THE COMPANY SHALL HAVE THE RIGHT AND OPTION TO PURCHASE, OR TO ARRANGE FOR A
THIRD PARTY TO PURCHASE, ALL (BUT NOT LESS THAN ALL) OF THE SHARES OF STOCK
COVERED BY THE THIRD PARTY OFFER, PURSUANT TO SECTION 4(B).

 

(B)                                 THE COMPANY SHALL HAVE THE RIGHT AND OPTION
TO PURCHASE, OR TO ARRANGE FOR A THIRD PARTY TO PURCHASE, ALL OF THE SHARES OF
STOCK COVERED BY THE THIRD PARTY OFFER AT THE SAME PRICE AND ON SUBSTANTIALLY
THE SAME TERMS AND CONDITIONS AS THE THIRD PARTY OFFER (OR, IF THE THIRD PARTY
OFFER INCLUDES ANY CONSIDERATION OTHER THAN CASH, THEN AT THE SOLE OPTION OF THE
COMPANY, AT THE EQUIVALENT ALL CASH PRICE, DETERMINED IN GOOD FAITH BY THE
COMPANY’S BOARD), BY DELIVERING A CERTIFIED BANK CHECK OR CHECKS IN THE
APPROPRIATE AMOUNT (OR BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS, IF THE
MANAGEMENT STOCKHOLDER ENTITIES PROVIDE TO THE COMPANY WIRE TRANSFER
INSTRUCTIONS) (AND ANY SUCH NON-CASH CONSIDERATION TO BE PAID) TO THE MANAGEMENT
STOCKHOLDER AT THE PRINCIPAL OFFICE OF THE COMPANY AGAINST DELIVERY OF
CERTIFICATES OR OTHER INSTRUMENTS REPRESENTING THE SHARES OF STOCK SO PURCHASED,
APPROPRIATELY ENDORSED BY THE MANAGEMENT STOCKHOLDER.  IF AT THE END OF THE
15-DAY PERIOD, THE COMPANY HAS NOT TENDERED THE PURCHASE PRICE FOR SUCH SHARES
IN THE MANNER SET FORTH ABOVE, THE MANAGEMENT STOCKHOLDER MAY, DURING THE
SUCCEEDING 60-DAY PERIOD, SELL NOT LESS THAN ALL OF THE SHARES OF STOCK COVERED
BY THE THIRD PARTY OFFER, TO THE OFFEROR ON TERMS NO LESS FAVORABLE TO THE
MANAGEMENT STOCKHOLDER THAN THOSE CONTAINED IN THE THIRD PARTY OFFER.  PROMPTLY
AFTER SUCH SALE, THE MANAGEMENT STOCKHOLDER SHALL NOTIFY THE COMPANY OF THE
CONSUMMATION THEREOF AND SHALL FURNISH SUCH EVIDENCE OF THE COMPLETION AND TIME
OF COMPLETION OF SUCH SALE AND OF THE TERMS THEREOF AS MAY REASONABLY BE
REQUESTED BY THE COMPANY.  IF, AT THE END OF SIXTY (60) DAYS FOLLOWING THE
EXPIRATION OF THE 15-DAY PERIOD DURING WHICH THE COMPANY IS ENTITLED HEREUNDER
TO PURCHASE THE STOCK, THE MANAGEMENT STOCKHOLDER HAS NOT COMPLETED THE SALE OF
SUCH SHARES OF THE STOCK AS AFORESAID, ALL OF THE RESTRICTIONS ON SALE, TRANSFER
OR ASSIGNMENT CONTAINED IN THIS AGREEMENT SHALL AGAIN BE IN EFFECT WITH RESPECT
TO SUCH SHARES OF THE STOCK.

 

(C)                                  NOTWITHSTANDING ANYTHING IN THIS AGREEMENT
TO THE CONTRARY, THIS SECTION 4 SHALL TERMINATE AND BE OF NO FURTHER FORCE OR
EFFECT UPON THE OCCURRENCE OF A CHANGE IN CONTROL.

 

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5.                                       THE MANAGEMENT STOCKHOLDER’S RIGHT TO
RESELL STOCK AND OPTIONS TO THE COMPANY.

 

(A)                                  EXCEPT AS OTHERWISE PROVIDED HEREIN, IF,
PRIOR TO THE LATER OF THE FIFTH ANNIVERSARY OF THE EFFECTIVE DATE AND A
QUALIFIED PUBLIC OFFERING, THE MANAGEMENT STOCKHOLDER’S EMPLOYMENT WITH THE
COMPANY (OR ANY OF ITS SUBSIDIARIES) TERMINATES AS A RESULT OF THE DEATH OR
PERMANENT DISABILITY OF THE MANAGEMENT STOCKHOLDER, THEN THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITY, SHALL, FOR 120 DAYS (THE “PUT PERIOD”) FOLLOWING
THE DATE OF SUCH TERMINATION FOR DEATH OR PERMANENT DISABILITY, HAVE THE RIGHT
TO:

 

(I)  WITH RESPECT TO THE STOCK, SELL TO THE COMPANY, AND THE COMPANY SHALL BE
REQUIRED TO PURCHASE, ON ONE OCCASION, ALL OF THE SHARES OF STOCK THEN HELD BY
THE APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES AT A PER SHARE PRICE EQUAL TO THE
FAIR MARKET VALUE PER SHARE (THE “SECTION 5 REPURCHASE PRICE”); AND

 

(II)  WITH RESPECT TO ANY OUTSTANDING OPTIONS, SELL TO THE COMPANY, AND THE
COMPANY SHALL BE REQUIRED TO PURCHASE, ON ONE OCCASION, ALL OF THE EXERCISABLE
OPTIONS THEN HELD BY THE APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES FOR AN
AMOUNT EQUAL TO THE PRODUCT OF (X) THE EXCESS, IF ANY, OF THE SECTION 5
REPURCHASE PRICE OVER THE OPTION EXERCISE PRICE AND (Y) THE NUMBER OF
EXERCISABLE OPTION SHARES, WHICH OPTIONS SHALL BE TERMINATED IN EXCHANGE FOR
SUCH PAYMENT.  IN THE EVENT THE FOREGOING OPTION EXCESS PRICE IS ZERO OR A
NEGATIVE NUMBER, ALL OUTSTANDING EXERCISABLE STOCK OPTIONS GRANTED TO THE
MANAGEMENT STOCKHOLDER UNDER THE OPTION PLAN SHALL BE AUTOMATICALLY TERMINATED
WITHOUT ANY PAYMENT IN RESPECT THEREOF.  IN THE EVENT THAT THE MANAGEMENT
STOCKHOLDER ENTITIES DO NOT EXERCISE THE FOREGOING RIGHTS, ALL EXERCISABLE BUT
UNEXERCISED OPTIONS SHALL TERMINATE PURSUANT TO THE TERMS OF SECTION 3.2(B) OF
THE STOCK OPTION AGREEMENT.  ALL UNEXERCISABLE OPTIONS HELD BY THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITIES SHALL TERMINATE WITHOUT PAYMENT IMMEDIATELY UPON
TERMINATION OF EMPLOYMENT.

 

(B)                                 IN THE EVENT THE APPLICABLE MANAGEMENT
STOCKHOLDER ENTITIES INTEND TO EXERCISE THEIR RIGHTS PURSUANT TO SECTION 5(A),
SUCH MANAGEMENT STOCKHOLDER ENTITIES SHALL SEND WRITTEN NOTICE TO THE COMPANY,
AT ANY TIME DURING THE PUT PERIOD, OF THEIR INTENTION TO SELL SHARES OF STOCK IN
EXCHANGE FOR THE PAYMENT REFERRED TO IN SECTION 5(A)(I) AND/OR TO SELL SUCH
OPTIONS IN EXCHANGE FOR THE PAYMENT REFERRED TO IN SECTION 5(A)(II) AND SHALL
INDICATE THE NUMBER OF SHARES OF STOCK TO BE SOLD AND THE NUMBER OF OPTIONS TO
BE SOLD WITH PAYMENT IN RESPECT THEREOF (THE “REDEMPTION NOTICE”).  THE
COMPLETION OF THE PURCHASES SHALL TAKE PLACE AT THE PRINCIPAL OFFICE OF THE
COMPANY ON THE TENTH BUSINESS DAY AFTER THE GIVING OF THE REDEMPTION NOTICE. 
THE APPLICABLE REPURCHASE PRICE (INCLUDING ANY PAYMENT WITH RESPECT TO THE
OPTIONS AS DESCRIBED ABOVE) SHALL BE PAID BY DELIVERY TO THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITIES OF A CERTIFIED BANK CHECK OR CHECKS IN THE
APPROPRIATE AMOUNT PAYABLE TO THE ORDER OF EACH OF THE APPLICABLE MANAGEMENT
STOCKHOLDER ENTITIES (OR BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS, IF THE
MANAGEMENT STOCKHOLDER ENTITIES PROVIDE TO THE COMPANY WIRE TRANSFER
INSTRUCTIONS), AGAINST DELIVERY OF CERTIFICATES OR OTHER INSTRUMENTS
REPRESENTING THE STOCK SO PURCHASED AND APPROPRIATE DOCUMENTS CANCELLING THE
OPTIONS SO TERMINATED APPROPRIATELY ENDORSED OR EXECUTED BY THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITIES OR ANY DULY AUTHORIZED REPRESENTATIVE.

 

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(C)                                  NOTWITHSTANDING ANYTHING IN SECTION 5(A) TO
THE CONTRARY AND SUBJECT TO SECTION 10(A), IF THERE EXISTS AND IS CONTINUING A
DEFAULT OR AN EVENT OF DEFAULT ON THE PART OF THE COMPANY OR ANY SUBSIDIARY OF
THE COMPANY UNDER ANY LOAN, GUARANTEE OR OTHER AGREEMENT UNDER WHICH THE COMPANY
OR ANY SUBSIDIARY OF THE COMPANY HAS BORROWED MONEY OR IF THE REPURCHASE
REFERRED TO IN SECTION 5(A) WOULD RESULT IN A DEFAULT OR AN EVENT OF DEFAULT ON
THE PART OF THE COMPANY OR ANY SUBSIDIARY OF THE COMPANY UNDER ANY SUCH
AGREEMENT OR IF A REPURCHASE WOULD NOT BE PERMITTED UNDER SECTION 170 OF THE
DELAWARE GENERAL CORPORATION LAW (THE “DGCL”) OR WOULD OTHERWISE VIOLATE THE
DGCL (OR IF THE COMPANY REINCORPORATES IN ANOTHER STATE, THE BUSINESS
CORPORATION LAW OF SUCH STATE) (EACH SUCH OCCURRENCE BEING AN “EVENT”), THE
COMPANY SHALL NOT BE OBLIGATED TO REPURCHASE ANY OF THE STOCK OR THE OPTIONS
FROM THE APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES UNTIL THE FIRST BUSINESS DAY
WHICH IS TEN (10) CALENDAR DAYS AFTER ALL OF THE FOREGOING EVENTS HAVE CEASED TO
EXIST (THE “REPURCHASE ELIGIBILITY DATE”); PROVIDED, HOWEVER, THAT (I) THE
NUMBER OF SHARES OF STOCK SUBJECT TO REPURCHASE UNDER THIS SECTION 5(C) SHALL BE
THAT NUMBER OF SHARES OF STOCK, AND (II) IN THE CASE OF A REPURCHASE PURSUANT TO
SECTION 5(A)(II), THE NUMBER OF EXERCISABLE OPTION SHARES FOR PURPOSES OF
CALCULATING THE OPTION EXCESS PRICE PAYABLE UNDER THIS SECTION 5(C) SHALL BE THE
NUMBER OF EXERCISABLE OPTION SHARES, IN EACH CASE AS SPECIFIED IN THE REDEMPTION
NOTICE AND HELD BY THE APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES AT THE TIME OF
DELIVERY OF THE REDEMPTION NOTICE IN ACCORDANCE WITH SECTION 5(B) HEREOF.  ALL
OPTIONS EXERCISABLE AS OF THE DATE OF A REDEMPTION NOTICE, IN THE CASE OF A
REPURCHASE PURSUANT TO SECTION 5(A), SHALL CONTINUE TO BE EXERCISABLE UNTIL THE
ACTUAL REPURCHASE OF SUCH OPTIONS PURSUANT TO SUCH REDEMPTION NOTICE, PROVIDED
THAT TO THE EXTENT ANY OPTIONS ARE EXERCISED AFTER THE DATE OF SUCH REDEMPTION
NOTICE, THE NUMBER OF EXERCISABLE OPTION SHARES FOR PURPOSES OF CALCULATING THE
OPTION EXCESS PRICE SHALL BE REDUCED ACCORDINGLY.  NOTWITHSTANDING THE FOREGOING
AND SUBJECT TO SECTION 6(D), IF AN EVENT EXISTS AND IS CONTINUING FOR
NINETY (90) DAYS, THE MANAGEMENT STOCKHOLDER ENTITIES SHALL BE PERMITTED BY
WRITTEN NOTICE TO RESCIND ANY REDEMPTION NOTICE.

 

(D)                                 EFFECT OF CHANGE IN CONTROL. 
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, EXCEPT FOR ANY
PAYMENT OBLIGATION OF THE COMPANY WHICH HAS ARISEN PRIOR TO THE OCCURRENCE OF A
CHANGE OF CONTROL, THIS SECTION 5 SHALL TERMINATE AND BE OF NO FURTHER FORCE OR
EFFECT UPON THE OCCURRENCE OF SUCH CHANGE IN CONTROL.

 

6.                                           THE COMPANY’S OPTION TO PURCHASE
STOCK AND OPTIONS OF MANAGEMENT STOCKHOLDER UPON CERTAIN TERMINATIONS OF
EMPLOYMENT.

 

(A)                                  TERMINATION FOR CAUSE BY THE COMPANY,
TERMINATION BY THE MANAGEMENT STOCKHOLDER WITHOUT GOOD REASON (OTHER THAN DUE TO
HIS DEATH OR PERMANENT DISABILITY) AND OTHER CALL EVENTS.  IF, PRIOR TO THE
FIFTH ANNIVERSARY OF THE EFFECTIVE DATE, (I) THE MANAGEMENT STOCKHOLDER’S ACTIVE
EMPLOYMENT WITH THE COMPANY (AND/OR, IF APPLICABLE, ITS SUBSIDIARIES) IS
TERMINATED BY THE COMPANY (AND/OR, IF APPLICABLE, ITS SUBSIDIARIES) FOR CAUSE,
(II) THE MANAGEMENT STOCKHOLDER’S ACTIVE EMPLOYMENT WITH THE COMPANY (AND/OR, IF
APPLICABLE, ITS SUBSIDIARIES) IS TERMINATED BY THE MANAGEMENT STOCKHOLDER
WITHOUT GOOD REASON (OTHER THAN DUE TO HIS DEATH OR PERMANENT DISABILITY),
(III) THE BENEFICIARIES OF A MANAGEMENT STOCKHOLDER’S TRUST SHALL INCLUDE ANY
PERSON OR ENTITY OTHER THAN THE MANAGEMENT STOCKHOLDER, HIS SPOUSE (OR
EX-SPOUSE) OR HIS LINEAL DESCENDANTS (INCLUDING ADOPTED CHILDREN) OR (IV) THE
MANAGEMENT STOCKHOLDER SHALL OTHERWISE EFFECT A TRANSFER OF ANY OF THE STOCK
OTHER THAN AS PERMITTED IN THIS AGREEMENT (OTHER THAN AS MAY BE REQUIRED BY
APPLICABLE LAW OR AN ORDER OF A COURT HAVING

 

7

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COMPETENT JURISDICTION) AFTER NOTICE FROM THE COMPANY OF SUCH IMPERMISSIBLE
TRANSFER AND A REASONABLE OPPORTUNITY TO CURE SUCH TRANSFER (EACH, A
“SECTION 6(A) CALL EVENT”):

 

(A)                              WITH RESPECT TO THE STOCK, THE COMPANY MAY
PURCHASE ALL OR ANY PORTION OF THE SHARES OF THE STOCK THEN HELD BY THE
APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES AT A PER SHARE PURCHASE PRICE EQUAL
TO THE LESSER OF (X) THE BASE PRICE AND (Y) THE BOOK VALUE PER SHARE (OR AFTER A
PUBLIC OFFERING, MARKET VALUE PER SHARE) (ANY SUCH APPLICABLE REPURCHASE PRICE,
THE “SECTION 6(A) REPURCHASE PRICE”); AND

 

(B)                                WITH RESPECT TO THE OPTIONS, ALL OPTIONS
(WHETHER OR NOT THEN EXERCISABLE) HELD BY THE APPLICABLE MANAGEMENT STOCKHOLDER
ENTITIES WILL TERMINATE IMMEDIATELY WITHOUT PAYMENT IN RESPECT THEREOF.

 

(B)                                 TERMINATION WITHOUT CAUSE BY THE COMPANY
(OTHER THAN DUE TO HIS DEATH OR PERMANENT DISABILITY), AND TERMINATION BY THE
MANAGEMENT STOCKHOLDER WITH GOOD REASON.  EXCEPT AS OTHERWISE PROVIDED HEREIN,
IF, PRIOR TO THE FIFTH ANNIVERSARY OF THE EFFECTIVE DATE, (I) THE MANAGEMENT
STOCKHOLDER’S ACTIVE EMPLOYMENT WITH THE COMPANY (AND/OR, IF APPLICABLE, ITS
SUBSIDIARIES) IS TERMINATED BY THE COMPANY (AND/OR, IF APPLICABLE, ITS
SUBSIDIARIES) WITHOUT CAUSE (OTHER THAN DUE TO HIS DEATH OR PERMANENT
DISABILITY), OR (II) THE MANAGEMENT STOCKHOLDER’S ACTIVE EMPLOYMENT WITH THE
COMPANY (AND/OR, IF APPLICABLE, ITS SUBSIDIARIES) IS TERMINATED BY THE
MANAGEMENT STOCKHOLDER WITH GOOD REASON, (EACH, A “SECTION 6(B) CALL EVENT”):

 

(A)                              WITH RESPECT TO THE STOCK, THE COMPANY MAY
PURCHASE ALL OR ANY PORTION OF THE SHARES OF SUCH STOCK THEN HELD BY THE
APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES AT A PER SHARE PURCHASE PRICE EQUAL
TO THE FAIR MARKET VALUE PER SHARE; AND

 

(B)                                WITH RESPECT TO THE OPTIONS, THE COMPANY MAY
PURCHASE ALL OR ANY PORTION OF THE EXERCISABLE OPTIONS HELD BY THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITIES FOR AN AMOUNT EQUAL TO THE PRODUCT OF (X) THE
EXCESS, IF ANY, OF THE PRICE EQUAL TO THE FAIR MARKET VALUE PER SHARE OVER THE
OPTION EXERCISE PRICE AND (Y) THE NUMBER OF EXERCISABLE OPTION SHARES, WHICH
OPTIONS SHALL BE TERMINATED IN EXCHANGE FOR SUCH PAYMENT.  IN THE EVENT THE
FOREGOING OPTION EXCESS PRICE IS ZERO OR A NEGATIVE NUMBER, ALL OUTSTANDING
EXERCISABLE STOCK OPTIONS GRANTED TO THE MANAGEMENT STOCKHOLDER UNDER THE OPTION
PLAN SHALL BE AUTOMATICALLY TERMINATED WITHOUT ANY PAYMENT IN RESPECT THEREOF. 
IN THE EVENT THAT THE COMPANY DOES NOT EXERCISE THE FOREGOING RIGHTS, ALL
EXERCISABLE BUT UNEXERCISED OPTIONS SHALL TERMINATE PURSUANT TO THE TERMS OF
SECTION 3.2(D) OR (E), AS THE CASE MAY BE, OF THE STOCK OPTION AGREEMENT.  ALL
UNEXERCISABLE OPTIONS HELD BY THE APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES
SHALL ALSO TERMINATE WITHOUT PAYMENT IMMEDIATELY UPON TERMINATION OF EMPLOYMENT.

 

(C)                                  TERMINATION FOR DEATH OR DISABILITY. 
EXCEPT AS OTHERWISE PROVIDED HEREIN, IF, PRIOR TO THE FIFTH ANNIVERSARY OF THE
EFFECTIVE DATE, THE MANAGEMENT STOCKHOLDER’S EMPLOYMENT WITH THE COMPANY
(AND/OR, IF APPLICABLE, ITS SUBSIDIARIES) IS TERMINATED AS A RESULT OF THE DEATH
OR PERMANENT DISABILITY OF THE MANAGEMENT STOCKHOLDER (EACH A “SECTION 6(C) CALL
EVENT”), THEN THE COMPANY MAY:

 

8

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(A)                              WITH RESPECT TO THE STOCK, PURCHASE ALL OR ANY
PORTION OF THE SHARES OF STOCK THEN HELD BY THE APPLICABLE MANAGEMENT
STOCKHOLDER ENTITIES AT A PER SHARE PRICE EQUAL TO THE FAIR MARKET VALUE PER
SHARE; AND

 

(B)                                WITH RESPECT TO THE OPTIONS, PURCHASE ALL OR
ANY PORTION OF THE EXERCISABLE OPTIONS FOR AN AMOUNT EQUAL TO THE PRODUCT OF
(X) THE EXCESS, IF ANY, OF THE FAIR MARKET VALUE PER SHARE OVER THE OPTION
EXERCISE PRICE AND (Y) THE NUMBER OF EXERCISABLE OPTION SHARES, WHICH OPTIONS
SHALL BE TERMINATED IN EXCHANGE FOR SUCH PAYMENT.  IN THE EVENT THE FOREGOING
OPTION EXCESS PRICE IS ZERO OR A NEGATIVE NUMBER, ALL OUTSTANDING EXERCISABLE
STOCK OPTIONS GRANTED TO THE MANAGEMENT STOCKHOLDER UNDER THE OPTION PLAN SHALL
BE AUTOMATICALLY TERMINATED WITHOUT ANY PAYMENT IN RESPECT THEREOF.  IN THE
EVENT THAT THE COMPANY DOES NOT EXERCISE THE FOREGOING RIGHTS ALL EXERCISABLE
BUT UNEXERCISED OPTIONS SHALL TERMINATE PURSUANT TO THE TERMS OF SECTION 3.2(B)
OF THE STOCK OPTION AGREEMENT.  ALL UNEXERCISABLE OPTIONS HELD BY THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITIES SHALL ALSO TERMINATE WITHOUT PAYMENT IMMEDIATELY
UPON TERMINATION OF EMPLOYMENT.

 

(D)                                 CALL NOTICE.  THE COMPANY SHALL HAVE A
PERIOD OF SIXTY (60) DAYS FROM THE LATER OF (I) SIXTY (60) DAYS FROM THE DATE OF
ANY CALL EVENT (OR, IF LATER, WITH RESPECT TO A SECTION 6(A) CALL EVENT, THE
DATE AFTER DISCOVERY OF, AND THE APPLICABLE CURE PERIOD FOR, AN IMPERMISSIBLE
TRANSFER CONSTITUTING A SECTION 6(A) CALL EVENT) AND (II) THIRTY (30) DAYS FROM
THE DATE THE MANAGEMENT STOCKHOLDER RESCINDS A REDEMPTION NOTICE PURSUANT TO THE
LAST SENTENCE OF SECTION 5(C), IN WHICH TO GIVE NOTICE IN WRITING TO THE
MANAGEMENT STOCKHOLDER OF ITS ELECTION TO EXERCISE ITS RIGHTS AND OBLIGATIONS
PURSUANT TO THIS SECTION 6 (“REPURCHASE NOTICE”).  THE COMPLETION OF THE
PURCHASES PURSUANT TO THE FOREGOING SHALL TAKE PLACE AT THE PRINCIPAL OFFICE OF
THE COMPANY ON THE TENTH BUSINESS DAY AFTER THE GIVING OF THE CALL NOTICE.  THE
APPLICABLE REPURCHASE PRICE (INCLUDING ANY PAYMENT WITH RESPECT TO THE OPTIONS
AS DESCRIBED IN THIS SECTION 6) SHALL BE PAID BY DELIVERY TO THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITIES OF A CERTIFIED BANK CHECK OR CHECKS IN THE
APPROPRIATE AMOUNT PAYABLE TO THE ORDER OF EACH OF THE APPLICABLE MANAGEMENT
STOCKHOLDER ENTITIES (OR BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS, IF THE
MANAGEMENT STOCKHOLDER ENTITIES PROVIDE TO THE COMPANY WIRE TRANSFER
INSTRUCTIONS) AGAINST DELIVERY OF CERTIFICATES OR OTHER INSTRUMENTS REPRESENTING
THE STOCK SO PURCHASED AND APPROPRIATE DOCUMENTS CANCELLING THE OPTIONS SO
TERMINATED, APPROPRIATELY ENDORSED OR EXECUTED BY THE APPLICABLE MANAGEMENT
STOCKHOLDER ENTITIES OR ANY DULY AUTHORIZED REPRESENTATIVE.

 

(E)                                  DELAY OF CALL.  NOTWITHSTANDING ANY OTHER
PROVISION OF THIS SECTION 6 TO THE CONTRARY AND SUBJECT TO SECTION 10(A), IF
THERE EXISTS AND IS CONTINUING ANY EVENT, THE COMPANY SHALL DELAY THE REPURCHASE
OF ANY OF THE STOCK OR THE OPTIONS (PURSUANT TO A CALL NOTICE TIMELY GIVEN IN
ACCORDANCE WITH SECTION 6(D) HEREOF) FROM THE APPLICABLE MANAGEMENT STOCKHOLDER
ENTITIES UNTIL THE REPURCHASE ELIGIBILITY DATE; PROVIDED, HOWEVER, THAT (I) THE
NUMBER OF SHARES OF STOCK SUBJECT TO REPURCHASE UNDER THIS SECTION 6 SHALL BE
THAT NUMBER OF SHARES OF STOCK, AND (II) IN THE CASE OF A REPURCHASE PURSUANT TO
SECTION 6(B) OR 6(C), THE NUMBER OF EXERCISABLE OPTION SHARES FOR PURPOSES OF
CALCULATING THE OPTION EXCESS PRICE PAYABLE UNDER THIS SECTION 6 SHALL BE THE
NUMBER OF EXERCISABLE OPTION SHARES, IN EACH CASE HELD BY THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITIES AT THE TIME OF DELIVERY OF (AND AS SET FORTH IN)
A CALL NOTICE IN ACCORDANCE WITH SECTION 6(D) HEREOF.  ALL OPTIONS EXERCISABLE
AS OF THE DATE OF A REPURCHASE NOTICE, IN THE CASE OF A REPURCHASE PURSUANT TO
SECTION 6(B) OR 6(C), SHALL CONTINUE TO BE EXERCISABLE UNTIL THE REPURCHASE OF
SUCH OPTIONS PURSUANT TO SUCH CALL NOTICE, PROVIDED THAT TO

 

9

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THE EXTENT THAT ANY OPTIONS ARE EXERCISED AFTER THE DATE OF SUCH CALL NOTICE,
THE NUMBER OF EXERCISABLE OPTION SHARES FOR PURPOSES OF CALCULATING THE OPTION
EXCESS PRICE SHALL BE REDUCED ACCORDINGLY.  NOTWITHSTANDING THE FOREGOING, IF AN
EVENT EXISTS AND IS CONTINUING FOR NINETY (90) DAYS, THE MANAGEMENT STOCKHOLDER
ENTITIES SHALL BE PERMITTED BY WRITTEN NOTICE TO CAUSE THE COMPANY TO RESCIND
ANY REPURCHASE NOTICE BUT THE COMPANY SHALL HAVE ANOTHER THIRTY (30) DAYS FROM
THE DATE THE EVENT CEASES TO EXIST TO GIVE ANOTHER REPURCHASE NOTICE ON THE
TERMS APPLICABLE TO THE FIRST REPURCHASE NOTICE.

 

(F)                                    EFFECT OF CHANGE IN CONTROL. 
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, EXCEPT FOR ANY
PAYMENT OBLIGATION OF THE COMPANY WHICH HAS ARISEN PRIOR TO THE OCCURRENCE OF A
CHANGE OF CONTROL, THIS SECTION 6 SHALL TERMINATE AND BE OF NO FURTHER FORCE OR
EFFECT UPON THE OCCURRENCE OF SUCH CHANGE IN CONTROL.

 

(G)                                 ADDITIONAL VESTING OF OPTIONS.  IN THE EVENT
THAT THE MANAGEMENT STOCKHOLDER EXERCISED HIS OR HER RIGHTS PURSUANT TO
SECTION 5(A) OR THE COMPANY EXERCISED ITS RIGHTS PURSUANT TO SECTION 6(A), 6(B)
OR 6(C), AND SUBSEQUENT TO SUCH PURCHASE OF THE SHARES AND OPTIONS, AS PROVIDED
FOR IN SECTIONS 5 AND 6, AN ADDITIONAL PERCENTAGE OF THE MANAGEMENT
STOCKHOLDER’S PERFORMANCE OPTION (AS DEFINED IN THE STOCK OPTION AGREEMENT)
BECOMES EXERCISABLE PURSUANT TO SECTION 3.1(A)(II)(B) OF THE STOCK OPTION
AGREEMENT, THEN SUCH PERFORMANCE OPTION SHALL BE CANCELLED UPON PAYMENT TO THE
MANAGEMENT STOCKHOLDER OF AN AMOUNT EQUAL TO THE PRODUCT OF (X) THE EXCESS, IF
ANY, OF THE APPLICABLE REPURCHASE PRICE FOR SUCH PERFORMANCE OPTION, AS PROVIDED
FOR IN SECTIONS 5 AND 6, OVER THE OPTION EXERCISE PRICE AND (Y) THE ADDITIONAL
NUMBER OF SHARES OF COMMON STOCK THAT COULD BE PURCHASED BY THE MANAGEMENT
STOCKHOLDER UPON EXERCISE OF THE ADDITIONAL PERCENTAGE OF THE PERFORMANCE OPTION
VESTED PURSUANT TO SECTION 3.1(A)(II)(B) OF THE STOCK OPTION AGREEMENT.

 

7.                                       ADJUSTMENT OF REPURCHASE PRICE;
DEFINITIONS.

 

(A)                                  ADJUSTMENT OF REPURCHASE PRICE.  IN
DETERMINING THE APPLICABLE REPURCHASE PRICE OF THE STOCK AND OPTIONS, AS
PROVIDED FOR IN SECTIONS 5 AND 6, ABOVE, APPROPRIATE ADJUSTMENTS SHALL BE MADE
FOR ANY STOCK DIVIDENDS, SPLITS, COMBINATIONS, RECAPITALIZATIONS OR ANY OTHER
ADJUSTMENT IN THE NUMBER OF OUTSTANDING SHARES OF STOCK IN ORDER TO MAINTAIN, AS
NEARLY AS PRACTICABLE, THE INTENDED OPERATION OF THE PROVISIONS OF SECTIONS 5
AND 6.

 

(B)                                 DEFINITIONS.  ALL CAPITALIZED TERMS USED IN
THIS AGREEMENT AND NOT DEFINED HEREIN SHALL HAVE SUCH MEANING AS SUCH TERMS ARE
DEFINED IN THE OPTION PLAN.  TERMS USED HEREIN AND AS LISTED BELOW SHALL BE
DEFINED AS FOLLOWS:

 

“Act” shall have the meaning set forth in Section 2(a)(i) hereof.

 

“Agreement” shall have the meaning set forth in the introductory paragraph.

 

“Base Price” shall have the meaning set forth in Section 1(a) hereof.

 

“Board” shall mean the board of directors of the Company.

 

“Book Value Per Share” shall mean (a) the Base Price plus (b) the quotient of
(A)(i) the aggregate net income of the Company from and after the Closing Date
(as decreased by any net

 

10

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losses from and after the Closing Date) excluding any one time costs and
expenses charged to income associated with the Closing and any related
transactions plus (ii) the aggregate dollar amount contributed to (or credited
to common stockholders’ equity of) the Company after the Closing Date as equity
of the Company (including consideration that would be received upon the exercise
of all outstanding stock options and other rights to acquire Common Stock and
the conversion of all securities convertible into Common Stock and other stock
equivalents) plus (iii) to the extent reflected as deductions to Book Value Per
Share in clause (i) above, unusual or other items recognized by the Company
(including, without limitation, extraordinary charges, and one time or
accelerated write-offs of good will, net of the related impact on the provision
for income taxes), in each case, if and to the extent determined in good faith
by the Board, plus (iv) the amortization of purchase accounting adjustments
occurring as a result of the Closing, minus (v) to the extent reflected as
additions to Book Value Per Share in clause (i) above, unusual or other items
recognized by the Company, in each case, if and to the extent determined in good
faith by the Board, minus (vi) the aggregate dollar amount of any dividends paid
by the Company after the Closing Date, divided by (B) the sum of the number of
shares of Common Stock then outstanding and the number of shares of Common Stock
issuable upon the exercise of all outstanding stock options and other rights to
acquire Common Stock.  The items referred to in the calculations set forth in
clauses (b)(A)(i) through (vi) of the immediately preceding sentence shall be
determined in good faith, and to the extent possible, in accordance with
generally accepted accounting principles applied on a basis consistent with any
prior periods as reflected in the consolidated financial statements of the
Company.

 

“Call Events” shall mean, collectively, Section 6(a) Call Events, Section 6(b)
Call Events, and Section 6(c) Call Events.

 

“Call Notice” shall have the meaning set forth in Section 6(d) hereof.

 

“Cause” shall mean “Cause” as such term may be defined in any employment
agreement or change-in-control agreement in effect at the time of termination
between the Management Stockholder and the Company or any of its subsidiaries or
Rule 405 Affiliates; or, if there is no such employment or change in-control
agreement, “Cause” shall mean (i) the Management Stockholder’s willful and
continued failure to perform his or her material duties with respect to the
Company or it subsidiaries which continues beyond ten (10) days after a written
demand for substantial performance is delivered to the Management Stockholder by
the Company (the “Cure Period”), (ii) the willful or intentional engaging by the
Management Stockholder in conduct that causes material and demonstrable injury,
monetarily or otherwise, to the Company, the Investors or their respective
Rule 405 Affiliates, (iii) commission of a crime constituting (A) a felony under
the laws of the United States or any state thereof or (B) a misdemeanor
involving moral turpitude, or (iv) a material breach of by the Management
Stockholder of this Agreement or other agreements, including, without
limitation, engaging in any action in breach of restrictive covenants, herein or
therein, that continues beyond the Cure Period (to the extent that, in the
Board’s reasonable judgment, such breach can be cured).

 

“Change in Control” means (i) the sale (in one transaction or a series of
transactions) of all or substantially all of the assets of the Company to an
Unaffiliated Person; (ii) a sale (in one transaction or a series of
transactions) resulting in more than 50% of the voting stock of the Company
being held by an Unaffiliated Person; (iii) a merger, consolidation,
recapitalization or

 

11

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reorganization of the Company with or into another Unaffiliated Person; if and
only if any such event listed in clauses (i) through (iii) above results in the
inability of the Investors, or any member or members of the Investors, to
designate or elect a majority of the Board (or the board of directors of the
resulting entity or its parent company).  For purposes of this definition, the
term “Unaffiliated Person” means any Person or Group who is not (x) an Investor
or any member of the Investors, (y) a Rule 405 Affiliate of any Investor or any
member of any Investor, or (z) an entity in which any Investor, or any member of
any Investor holds, directly or indirectly, a majority of the economic interests
in such entity.

 

“Class A Common Stock shall have the meaning set forth in the first “whereas”
paragraph.

 

“Class C Common Stock” shall have the meaning set forth in the first “whereas”
paragraph.

 

“Closing” shall have the meaning set forth in the Contribution Agreement.

 

“Closing Date” shall have the meaning set forth in the first “whereas”
paragraph.

 

“Common Stock” shall have the meaning set forth in the first “whereas”
paragraph.

 

“Company” shall have the meaning set forth in the introductory paragraph.

 

“Confidential Information” shall mean all non-public information concerning
trade secret, know-how, software, developments, inventions, processes,
technology, designs, the financial data, strategic business plans or any
proprietary or confidential information, documents or materials in any form or
media, including any of the foregoing relating to research, operations,
finances, current and proposed products and services, vendors, customers,
advertising and marketing, and other non-public, proprietary, and confidential
information of the Restricted Group.

 

“Contribution Agreement” shall have the meaning set forth in the first “whereas”
paragraph.

 

“Custody Agreement and Power of Attorney” shall have the meaning set forth in
Section 9(e) hereof.

 

“DGCL” shall have the meaning set forth in Section 5(c) hereof.

 

“DLJMB Funds” shall have the meaning set forth in the second “whereas”
paragraph.

 

“Event” shall have the meaning set forth in Section 5(c) hereof.

 

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended (or
any successor section thereto).

 

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“Exercisable Option Shares” shall mean the shares of Common Stock that, at the
Repurchase Calculation Date, could be purchased by the Management Stockholder
upon exercise of his or her outstanding and exercisable Options.

 

“Fair Market Value Per Share” shall mean the Market Value Per Share, or, if
there has been no Public Offering, the fair market value of the Common Stock as
determined (i) in the good faith discretion of the Board after consultation with
management of the Company and (ii) without any premiums for control or discounts
for minority interests or restrictions on transfer.

 

“Fusion” shall have the meaning set forth in the first “whereas” paragraph.

 

“Good Reason” shall mean “Good Reason” as such term may be defined in any
employment agreement or change-in-control agreement in effect at the time of
termination between the Management Stockholder and the Company or any of its
subsidiaries or Rule 405 Affiliates; or, if there is no such employment or
change-in-control agreement, “Good Reason” shall mean (i) a reduction in the
Management Stockholder’s base salary (other than a general reduction in base
salary that affects all members of senior management in substantially the same
proportions, provided that the Management Stockholder’s base salary is not
reduced by more than 10%); (ii) a substantial reduction in the Management
Stockholder’s duties and responsibilities; or (iii) a transfer of the Management
Stockholder’s primary workplace by more than fifty miles from his workplace as
of the Effective Date.

 

“Group” shall mean “group,” as such term is used for purposes of Section 13(d)
or 14(d) of the Exchange Act.

 

“Investors” shall have the meaning set forth in the second “whereas” paragraph.

 

“Management Stockholder” shall have the meaning set forth in the introductory
paragraph.

 

“Management Stockholder Entities” shall mean the Management Stockholder’s Trust,
the Management Stockholder and the Management Stockholder’s Estate,
collectively.

 

“Management Stockholder’s Estate” shall mean the conservators, guardians,
executors, administrators, testamentary trustees, legatees or beneficiaries of
the Management Stockholder.

 

“Management Stockholder’s Trust” shall mean a partnership, limited liability
company, corporation, trust or custodianship, the beneficiaries of which may
include only the Management Stockholder, his spouse (or ex-spouse) or his lineal
descendants (including adopted) or, if at any time after any such transfer there
shall be no then living spouse or lineal descendants, then to the ultimate
beneficiaries of any such trust or to the estate of a deceased beneficiary.

 

“Market Value Per Share” shall mean, on the Repurchase Calculation Date, the
price per share equal to (i) after a Public Offering but before a Qualified
Public Offering, (w) the average of the last sale price of the Common Stock on
the Repurchase Calculation Date on each stock exchange on which the Common Stock
may at the time be listed or, (x) if there shall have been no sales on any such
exchanges on the Repurchase Calculation Date on any given day, the

 

13

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average of the closing bid and asked prices of the Common Stock on each such
exchange on the Repurchase Calculation Date or, (y) if there is no such bid and
asked price on the Repurchase Calculation Date, the average of the closing bid
and asked prices of the Common Stock on the next preceding date when such bid
and asked price occurred or, (z) if the Common Stock shall not be so listed, the
closing sales price of the Common Stock as reported by NASDAQ on the Repurchase
Calculation Date in the over-the-counter market; and (ii) following a Qualified
Public Offering, the closing sale price of the Common Stock on the Repurchase
Calculation Date as reported on the primary exchange on which the Common Stock
is traded (or, if no such sale occurs on the Repurchase Calculation Date, such
closing sale price as was reported on the next preceding date when such closing
sale price occurred).

 

“Maximum Repurchase Amount” shall have the meaning set forth in Section 10(a)
hereof.

 

 “Notice” shall have the meaning set forth in Section 9(b) hereof.

 

“Offeror” shall have the meaning set forth in Section 4(a) hereof.

 

“Option” shall have the meaning set forth in the fourth “whereas” paragraph.

 

“Option Excess Price” shall mean the aggregate amount paid or payable by the
Company in respect of Exercisable Option Shares, as determined pursuant to
Section 5 or 6, as applicable.

 

“Option Exercise Price” shall mean the then-current exercise price of the shares
of Common Stock covered by the applicable Option.

 

“Option Plan” shall have the meaning set forth in the fourth “whereas”
paragraph.

 

“Option Stock” shall have the meaning set forth in Section 3(a) hereof.

 

“Other Management Stockholders” shall have the meaning set forth in the sixth
“whereas” paragraph.

 

“Other Management Stockholders’ Agreements” shall have the meaning set forth in
the seventh “whereas” paragraph.

 

“Parties” shall have the meaning set forth in the introductory paragraph.

 

“Permanent Disability” shall mean “Disability” or “Permanent Disability” (as
applicable) as such term may be defined in any employment agreement or
change-in-control agreement in effect at the time of termination between the
Management Stockholder and the Company or any of its subsidiaries or Rule 405
Affiliates; or, if there is no such employment or change-in-control agreement,
“Permanent Disability” shall mean the Management Stockholder becomes physically
or mentally incapacitated and is therefore unable for a period of six (6)
consecutive months or for an aggregate of nine (9) months in any eighteen (18)
consecutive month period to perform substantially all of the material elements
of the Management Stockholder’s duties with the Company or any subsidiary or
Rule 405 Affiliate thereof.  Any question as to the existence of the Permanent
Disability of the Management Stockholder as to which the Management Stockholder

 

14

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and the Company cannot agree shall be determined in writing by a qualified
independent physician mutually acceptable to the Management Stockholder and the
Company.  If the Management Stockholder and the Company cannot agree as to a
qualified independent physician, each shall appoint such a physician and those
two physicians shall select a third who shall make such determination in
writing.  The determination of Permanent Disability made in writing to the
Company and the Management Stockholder shall be final and conclusive for all
purposes of this Agreement.

 

“Person” shall mean “person,” as such term is used for purposes of Section 13(d)
or 14(d) of the Exchange Act.

 

“Piggyback Registration Rights” shall have the meaning set forth in
Section 9(a).

 

“Proposed Registration” shall have the meaning set forth in Section 9(b) hereof.

 

“Public Offering” shall mean the sale of shares of Common Stock to the public
subsequent to the date hereof pursuant to a registration statement under the Act
which has been declared effective by the SEC (other than a registration
statement on Form S-4, S-8 or any other similar form).

 

“Purchased Stock” shall have the meaning set forth in the fifth “whereas”
paragraph.

 

“Qualified Public Offering” shall mean a Public Offering, which results in an
active trading market of 25% or more of the Common Stock.

 

“Registration Rights Agreement” shall have the meaning set forth in
Section 9(a).

 

“Repurchase Calculation Date” shall mean the last day of the month preceding the
later of (i) the month in which the event giving rise to the right to repurchase
occurs and (ii) the month in which the Repurchase Eligibility Date occurs.

 

“Repurchase Eligibility Date” shall have the meaning set forth in Section 5(c)
hereof.

 

“Repurchase Price” shall mean the amount to be paid in respect of the Stock and
Options to be purchased by the Company pursuant to Section 5(a), Section 6(a),
6(b), or 6(c), as applicable.

 

“Request” shall have the meaning set forth in Section 9(b) hereof.

 

“Restricted Group” shall mean, collectively, the Company, its subsidiaries, the
Investors and their respective Rule 405 Affiliates.

 

“Rule 405 Affiliate” shall mean an affiliate of the Company as defined under
Rule 405 of the rules and regulations promulgated under the Act and as
interpreted in good faith by the Board.

 

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“Sale Participation Agreement” shall mean that certain sale participation
agreement entered into by and between the Management Stockholder and the
Investors dated as of the date hereof.

 

“SEC” shall mean the Securities and Exchange Commission.

 

“Stock” shall have the meaning set forth in Section 3(a) hereof.

 

“Stock Option Agreement” shall have the meaning set forth in the fourth
“whereas” paragraph.

 

 “Third Party Offer” shall have the meaning set forth in Section 4(a) hereof.

 

“Transaction Agreement” shall have the meaning set forth in the first “whereas”
paragraph.

 

“Transfer” shall have the meaning set forth in Section 2(a) hereof.

 

8.                                       THE COMPANY’S REPRESENTATIONS AND
WARRANTIES.

 

(A)                                  THE COMPANY REPRESENTS AND WARRANTS TO THE
MANAGEMENT STOCKHOLDER THAT (I) THIS AGREEMENT HAS BEEN DULY AUTHORIZED,
EXECUTED AND DELIVERED BY THE COMPANY AND IS ENFORCEABLE AGAINST THE COMPANY IN
ACCORDANCE WITH ITS TERMS AND (II) THE STOCK, WHEN ISSUED AND DELIVERED IN
ACCORDANCE WITH THE TERMS HEREOF AND THE OTHER AGREEMENTS CONTEMPLATED HEREBY,
WILL BE DULY AND VALIDLY ISSUED, FULLY PAID AND NONASSESSABLE.

 

(B)                                 IF THE COMPANY BECOMES SUBJECT TO THE
REPORTING REQUIREMENTS OF SECTION 12 OF THE EXCHANGE ACT, THE COMPANY WILL FILE
THE REPORTS REQUIRED TO BE FILED BY IT UNDER THE ACT AND THE EXCHANGE ACT AND
THE RULES AND REGULATIONS ADOPTED BY THE SEC THEREUNDER, TO THE EXTENT REQUIRED
FROM TIME TO TIME TO ENABLE THE MANAGEMENT STOCKHOLDER TO SELL SHARES OF STOCK
WITHOUT REGISTRATION UNDER THE EXCHANGE ACT WITHIN THE LIMITATIONS OF THE
EXEMPTIONS PROVIDED BY (A) RULE 144 UNDER THE ACT, AS SUCH RULE MAY BE AMENDED
FROM TIME TO TIME, OR (B) ANY SIMILAR RULE OR REGULATION HEREAFTER ADOPTED BY
THE SEC.  NOTWITHSTANDING ANYTHING CONTAINED IN THIS SECTION 8(B), THE COMPANY
MAY DE-REGISTER UNDER SECTION 12 OF THE EXCHANGE ACT IF IT IS THEN PERMITTED TO
DO SO PURSUANT TO THE EXCHANGE ACT AND THE RULES AND REGULATIONS THEREUNDER AND,
IN SUCH CIRCUMSTANCES, SHALL NOT BE REQUIRED HEREBY TO FILE ANY REPORTS WHICH
MAY BE NECESSARY IN ORDER FOR RULE 144 OR ANY SIMILAR RULE OR REGULATION UNDER
THE ACT TO BE AVAILABLE.  NOTHING IN THIS SECTION 8(B) SHALL BE DEEMED TO LIMIT
IN ANY MANNER THE RESTRICTIONS ON SALES OF STOCK CONTAINED IN THIS AGREEMENT.

 

9.                                       “PIGGYBACK” REGISTRATION RIGHTS. 
EFFECTIVE UPON THE DATE OF THIS AGREEMENT AND UNTIL THE LATER OF (I) THE FIRST
OCCURRENCE OF A QUALIFIED PUBLIC OFFERING AND (II) THE FIFTH ANNIVERSARY OF THE
EFFECTIVE DATE:

 

(A)                                  THE MANAGEMENT STOCKHOLDER HEREBY AGREES TO
BE BOUND BY ALL OF THE TERMS, CONDITIONS AND OBLIGATIONS OF THE PIGGYBACK
REGISTRATION RIGHTS CONTAINED IN SECTION 2 OF THE REGISTRATION RIGHTS AGREEMENT
(THE “REGISTRATION RIGHTS AGREEMENT”) ENTERED INTO BY AND AMONG THE COMPANY AND
INVESTORS PARTY THERETO (THE “PIGGYBACK REGISTRATION RIGHTS”), AS IN

 

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EFFECT ON THE DATE HEREOF (SUBJECT TO ANY AMENDMENTS THERETO TO WHICH THE
MANAGEMENT STOCKHOLDER HAS AGREED IN WRITING TO BE BOUND), AND, IF FUSION IS
SELLING STOCK, SHALL HAVE ALL OF THE RIGHTS AND PRIVILEGES OF THE PIGGYBACK
REGISTRATION RIGHTS (INCLUDING, WITHOUT LIMITATION, THE RIGHT TO PARTICIPATE IN
THE QUALIFIED PUBLIC OFFERING AND ANY RIGHTS TO INDEMNIFICATION AND/OR
CONTRIBUTION FROM THE COMPANY AND/OR THE INVESTORS), IN EACH CASE AS IF THE
MANAGEMENT STOCKHOLDER WERE AN ORIGINAL PARTY (OTHER THAN THE COMPANY) TO THE
REGISTRATION RIGHTS AGREEMENT, SUBJECT TO APPLICABLE AND CUSTOMARY UNDERWRITER
RESTRICTIONS; PROVIDED, HOWEVER, THAT AT NO TIME SHALL THE MANAGEMENT
STOCKHOLDER HAVE ANY RIGHTS TO REQUEST REGISTRATION UNDER SECTION 3 OF THE
REGISTRATION AGREEMENT; AND PROVIDED FURTHER, THAT THE MANAGEMENT STOCKHOLDER
SHALL NOT BE BOUND BY ANY AMENDMENTS TO THE REGISTRATION RIGHTS AGREEMENT UNLESS
THE MANAGEMENT STOCKHOLDER CONSENTS IN WRITING THERETO PROVIDED THAT SUCH
CONSENT WILL NOT BE UNREASONABLY WITHHELD.  ALL STOCK PURCHASED OR HELD BY THE
APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES PURSUANT TO THIS AGREEMENT SHALL BE
DEEMED TO BE “REGISTRABLE SECURITIES” AS DEFINED IN THE REGISTRATION RIGHTS
AGREEMENT.

 

(B)                                 IN THE EVENT OF A SALE OF COMMON STOCK BY
FUSION IN ACCORDANCE WITH THE TERMS OF THE REGISTRATION RIGHTS AGREEMENT, THE
COMPANY WILL PROMPTLY NOTIFY THE MANAGEMENT STOCKHOLDER IN WRITING (A “NOTICE”)
OF ANY PROPOSED REGISTRATION (A “PROPOSED REGISTRATION”).  IF WITHIN
FIFTEEN (15) DAYS OF THE RECEIPT BY THE MANAGEMENT STOCKHOLDER OF SUCH NOTICE,
THE COMPANY RECEIVES FROM THE APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES A
WRITTEN REQUEST (A “REQUEST”) TO REGISTER SHARES OF STOCK HELD BY THE APPLICABLE
MANAGEMENT STOCKHOLDER ENTITIES (WHICH REQUEST WILL BE IRREVOCABLE UNLESS
OTHERWISE MUTUALLY AGREED TO IN WRITING BY THE MANAGEMENT STOCKHOLDER AND THE
COMPANY), SHARES OF STOCK WILL BE SO REGISTERED AS PROVIDED IN THIS SECTION 9;
PROVIDED, HOWEVER, THAT FOR EACH SUCH REGISTRATION STATEMENT ONLY ONE REQUEST,
WHICH SHALL BE EXECUTED BY THE APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES, MAY
BE SUBMITTED FOR ALL REGISTRABLE SECURITIES HELD BY THE APPLICABLE MANAGEMENT
STOCKHOLDER ENTITIES.

 

(C)                                  THE MAXIMUM NUMBER OF SHARES OF STOCK WHICH
WILL BE REGISTERED PURSUANT TO A REQUEST WILL BE THE LOWEST OF (I) THE NUMBER OF
SHARES OF STOCK THEN HELD BY THE MANAGEMENT STOCKHOLDER ENTITIES, INCLUDING ALL
SHARES OF STOCK WHICH THE MANAGEMENT STOCKHOLDER ENTITIES ARE THEN ENTITLED TO
ACQUIRE UNDER AN UNEXERCISED OPTION TO THE EXTENT THEN EXERCISABLE, MULTIPLIED
BY A FRACTION, THE NUMERATOR OF WHICH IS THE NUMBER OF SHARES OF STOCK BEING
SOLD BY FUSION AND ANY AFFILIATED OR UNAFFILIATED INVESTMENT PARTNERSHIPS AND
INVESTMENT LIMITED LIABILITY COMPANIES INVESTING WITH FUSION AND THE DENOMINATOR
OF WHICH IS THE AGGREGATE NUMBER OF SHARES OF STOCK OWNED BY FUSION AND ANY
INVESTMENT PARTNERSHIPS AND INVESTMENT LIMITED LIABILITY COMPANIES INVESTING
WITH FUSION OR (II) THE MAXIMUM NUMBER OF SHARES OF STOCK WHICH THE COMPANY CAN
REGISTER IN CONNECTION WITH SUCH REQUEST IN THE PROPOSED REGISTRATION WITHOUT
ADVERSE EFFECT ON THE OFFERING IN THE VIEW OF THE MANAGING UNDERWRITERS (REDUCED
PRO RATA AS MORE FULLY DESCRIBED IN SUBSECTION (D) OF THIS SECTION 9 OR
(III) THE MAXIMUM NUMBER OF SHARES WHICH THE MANAGEMENT STOCKHOLDER (PRO RATA
BASED UPON THE AGGREGATE NUMBER OF SHARES OF STOCK THE MANAGEMENT STOCKHOLDER
AND ALL OTHER MANAGEMENT STOCKHOLDERS HAVE REQUESTED TO BE REGISTERED) IS
PERMITTED TO REGISTER UNDER THE PIGGYBACK REGISTRATION RIGHTS.

 

(D)                                 IF A PROPOSED REGISTRATION INVOLVES AN
UNDERWRITTEN OFFERING AND THE MANAGING UNDERWRITER ADVISES THE COMPANY IN
WRITING THAT, IN ITS OPINION, THE NUMBER OF SHARES OF STOCK REQUESTED TO BE
INCLUDED IN THE PROPOSED REGISTRATION EXCEEDS THE NUMBER WHICH CAN BE SOLD IN
SUCH OFFERING, SO AS TO BE LIKELY TO HAVE AN ADVERSE EFFECT ON THE PRICE, TIMING
OR

 

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DISTRIBUTION OF THE SHARES OF STOCK OFFERED IN SUCH PUBLIC OFFERING AS
CONTEMPLATED BY THE COMPANY, THEN THE COMPANY WILL INCLUDE IN THE PROPOSED
REGISTRATION (I) FIRST, 100% OF THE SHARES OF STOCK THE COMPANY PROPOSES TO SELL
AND (II) SECOND, TO THE EXTENT OF THE NUMBER OF SHARES OF STOCK REQUESTED TO BE
INCLUDED IN SUCH REGISTRATION WHICH, IN THE OPINION OF SUCH MANAGING
UNDERWRITER, CAN BE SOLD WITHOUT HAVING THE ADVERSE EFFECT REFERRED TO ABOVE,
THE NUMBER OF SHARES OF STOCK WHICH THE SELLING INVESTORS AND ANY AFFILIATED OR
UNAFFILIATED INVESTMENT PARTNERSHIPS AND INVESTMENT LIMITED LIABILITY COMPANIES
INVESTING WITH THE SELLING INVESTORS, THE MANAGEMENT STOCKHOLDER AND ALL OTHER
MANAGEMENT STOCKHOLDERS (TOGETHER, THE “HOLDERS”) HAVE REQUESTED TO BE INCLUDED
IN THE PROPOSED REGISTRATION, SUCH AMOUNT TO BE ALLOCATED PRO RATA AMONG ALL
REQUESTING HOLDERS ON THE BASIS OF THE RELATIVE NUMBER OF SHARES OF STOCK THEN
HELD BY EACH SUCH HOLDER (INCLUDING UPON EXERCISE OF ALL EXERCISABLE OPTIONS)
(PROVIDED THAT ANY SHARES THEREBY ALLOCATED TO ANY SUCH HOLDER THAT EXCEED SUCH
HOLDER’S REQUEST WILL BE REALLOCATED AMONG THE REMAINING REQUESTING HOLDERS IN
LIKE MANNER).

 

(E)                                  UPON DELIVERING A REQUEST THE MANAGEMENT
STOCKHOLDER WILL, IF REQUESTED BY THE COMPANY, EXECUTE AND DELIVER A CUSTODY
AGREEMENT AND POWER OF ATTORNEY HAVING CUSTOMARY TERMS AND IN FORM AND SUBSTANCE
REASONABLY SATISFACTORY TO THE COMPANY WITH RESPECT TO THE SHARES OF STOCK TO BE
REGISTERED PURSUANT TO THIS SECTION 9 (A “CUSTODY AGREEMENT AND POWER OF
ATTORNEY”).  THE CUSTODY AGREEMENT AND POWER OF ATTORNEY WILL PROVIDE, AMONG
OTHER THINGS, THAT THE MANAGEMENT STOCKHOLDER WILL DELIVER TO AND DEPOSIT IN
CUSTODY WITH THE CUSTODIAN AND ATTORNEY-IN-FACT NAMED THEREIN A CERTIFICATE OR
CERTIFICATES (TO THE EXTENT APPLICABLE) REPRESENTING SUCH SHARES OF STOCK (DULY
ENDORSED IN BLANK BY THE REGISTERED OWNER OR OWNERS THEREOF OR ACCOMPANIED BY
DULY EXECUTED STOCK POWERS IN BLANK) AND IRREVOCABLY APPOINT SAID CUSTODIAN AND
ATTORNEY-IN-FACT AS THE MANAGEMENT STOCKHOLDER’S AGENT AND ATTORNEY-IN-FACT WITH
FULL POWER AND AUTHORITY TO ACT UNDER THE CUSTODY AGREEMENT AND POWER OF
ATTORNEY ON THE MANAGEMENT STOCKHOLDER’S BEHALF WITH RESPECT TO THE MATTERS
SPECIFIED THEREIN.

 

(F)                                    SUBJECT TO THE TRANSFER RESTRICTIONS SET
FORTH IN SECTION 3, UPON THE OCCURRENCE OF A SALE OF COMMON STOCK BY FUSION IN A
PUBLIC OFFERING AND AT ALL TIME THEREAFTER, THE COMPANY SHALL MAINTAIN A
REGISTRATION STATEMENT ON FORM S-8 FILED WITH THE SEC THAT COVERS ALL SHARES OF
STOCK THAT THE MANAGEMENT STOCKHOLDER COULD REGISTER IN A PUBLIC SALE, IN ORDER
TO ALLOW THE MANAGEMENT STOCKHOLDER TO EXERCISE HIS RIGHTS SET FORTH IN THIS
SECTION 9.

 

(G)                                 THE MANAGEMENT STOCKHOLDER AGREES THAT HE
WILL EXECUTE SUCH OTHER AGREEMENTS AS THE COMPANY MAY REASONABLY REQUEST TO
FURTHER EVIDENCE THE PROVISIONS OF THIS SECTION 9.

 

10.                                 PRO RATA REPURCHASES; DIVIDENDS.  (A) 
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN SECTION 4, 5 OR 6, IF AT
ANY TIME CONSUMMATION OF ANY PURCHASE OR PAYMENT TO BE MADE BY THE COMPANY
PURSUANT TO THIS AGREEMENT AND THE OTHER MANAGEMENT STOCKHOLDERS AGREEMENTS
WOULD RESULT IN AN EVENT, THEN THE COMPANY SHALL MAKE PURCHASES FROM, AND
PAYMENTS TO, THE MANAGEMENT STOCKHOLDER AND OTHER MANAGEMENT STOCKHOLDERS PRO
RATA (ON THE BASIS OF THE PROPORTION OF THE NUMBER OF SHARES OF STOCK EACH SUCH
MANAGEMENT STOCKHOLDER AND ALL OTHER MANAGEMENT STOCKHOLDERS HAVE ELECTED OR ARE
REQUIRED TO SELL TO THE COMPANY) FOR THE MAXIMUM NUMBER OF SHARES OF STOCK
PERMITTED WITHOUT RESULTING IN AN EVENT (THE “MAXIMUM REPURCHASE AMOUNT”).  THE
PROVISIONS OF SECTION 5(C) AND 6(E) SHALL APPLY IN THEIR ENTIRETY TO PAYMENTS
AND REPURCHASES WITH RESPECT TO SHARES OF STOCK WHICH MAY NOT BE MADE DUE TO THE

 

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LIMITS IMPOSED BY THE MAXIMUM REPURCHASE AMOUNT UNDER THIS SECTION 10(A).  UNTIL
ALL OF SUCH STOCK IS PURCHASED AND PAID FOR BY THE COMPANY, THE MANAGEMENT
STOCKHOLDER AND THE OTHER MANAGEMENT STOCKHOLDERS WHOSE STOCK IS NOT PURCHASED
IN ACCORDANCE WITH THIS SECTION 10(A) SHALL HAVE PRIORITY, ON A PRO RATA BASIS,
OVER OTHER PURCHASES OF STOCK BY THE COMPANY PURSUANT TO THIS AGREEMENT AND
OTHER MANAGEMENT STOCKHOLDERS’ AGREEMENTS.

 

(B)                                 IN THE EVENT ANY DIVIDENDS ARE PAID WITH
RESPECT TO THE STOCK, THE MANAGEMENT STOCKHOLDER WILL BE TREATED IN THE SAME
MANNER AS ALL OTHER HOLDERS OF COMMON STOCK WITH RESPECT TO SHARES OF STOCK THEN
OWNED BY THE MANAGEMENT STOCKHOLDER, AND, WITH RESPECT TO ANY OPTIONS HELD BY
THE MANAGEMENT STOCKHOLDER, IN ACCORDANCE, AS APPLICABLE, WITH SECTION 2.4 OF
THE STOCK OPTION AGREEMENT.

 

11.                                 RIGHTS TO NEGOTIATE REPURCHASE PRICE. 
NOTHING IN THIS AGREEMENT SHALL BE DEEMED TO RESTRICT OR PROHIBIT THE COMPANY
FROM PURCHASING, REDEEMING OR OTHERWISE ACQUIRING FOR VALUE SHARES OF STOCK OR
OPTIONS FROM THE MANAGEMENT STOCKHOLDER, AT ANY TIME, UPON SUCH TERMS AND
CONDITIONS, AND FOR SUCH PRICE, AS MAY BE MUTUALLY AGREED UPON IN WRITING
BETWEEN THE PARTIES, WHETHER OR NOT AT THE TIME OF SUCH PURCHASE, REDEMPTION OR
ACQUISITION CIRCUMSTANCES EXIST WHICH SPECIFICALLY GRANT THE COMPANY THE RIGHT
TO PURCHASE, OR THE MANAGEMENT STOCKHOLDER THE RIGHT TO SELL, SHARES OF STOCK OR
ANY OPTIONS UNDER THE TERMS OF THIS AGREEMENT; PROVIDED THAT NO SUCH PURCHASE,
REDEMPTION OR ACQUISITION SHALL BE CONSUMMATED, AND NO AGREEMENT WITH RESPECT TO
ANY SUCH PURCHASE, REDEMPTION OR ACQUISITION SHALL BE ENTERED INTO, WITHOUT THE
PRIOR APPROVAL OF THE BOARD.

 

12.                                 COVENANT REGARDING 83(B) ELECTION.  EXCEPT
AS THE COMPANY MAY OTHERWISE AGREE IN WRITING, THE MANAGEMENT STOCKHOLDER HEREBY
COVENANTS AND AGREES THAT HE WILL MAKE AN ELECTION PROVIDED PURSUANT TO TREASURY
REGULATION 1.83-2 WITH RESPECT TO THE STOCK, INCLUDING WITHOUT LIMITATION, THE
STOCK TO BE ACQUIRED UPON EACH EXERCISE OF THE MANAGEMENT STOCKHOLDER’S OPTIONS;
AND MANAGEMENT STOCKHOLDER FURTHER COVENANTS AND AGREES THAT HE WILL FURNISH THE
COMPANY WITH COPIES OF THE FORMS OF ELECTION THE MANAGEMENT STOCKHOLDER FILES
WITHIN THIRTY (30) DAYS AFTER THE DATE HEREOF, AND WITHIN THIRTY (30) DAYS AFTER
EACH EXERCISE OF MANAGEMENT STOCKHOLDER’S OPTIONS AND WITH EVIDENCE THAT EACH
SUCH ELECTION HAS BEEN FILED IN A TIMELY MANNER.

 

13.                                 NOTICE OF CHANGE OF BENEFICIARY. 
IMMEDIATELY PRIOR TO ANY TRANSFER OF STOCK TO A MANAGEMENT STOCKHOLDER’S TRUST,
THE MANAGEMENT STOCKHOLDER SHALL PROVIDE THE COMPANY WITH A COPY OF THE
INSTRUMENTS CREATING THE MANAGEMENT STOCKHOLDER’S TRUST AND WITH THE IDENTITY OF
THE BENEFICIARIES OF THE MANAGEMENT STOCKHOLDER’S TRUST.  THE MANAGEMENT
STOCKHOLDER SHALL NOTIFY THE COMPANY AS SOON AS PRACTICABLE PRIOR TO ANY CHANGE
IN THE IDENTITY OF ANY BENEFICIARY OF THE MANAGEMENT STOCKHOLDER’S TRUST.

 

14.                                 RECAPITALIZATIONS, ETC.  THE PROVISIONS OF
THIS AGREEMENT SHALL APPLY, TO THE FULL EXTENT SET FORTH HEREIN WITH RESPECT TO
THE STOCK OR THE OPTIONS, TO ANY AND ALL SHARES OF CAPITAL STOCK OF THE COMPANY
OR ANY CAPITAL STOCK, PARTNERSHIP UNITS OR ANY OTHER SECURITY EVIDENCING
OWNERSHIP INTERESTS IN ANY SUCCESSOR OR ASSIGN OF THE COMPANY (WHETHER BY
MERGER, CONSOLIDATION, SALE OF ASSETS OR OTHERWISE) WHICH MAY BE ISSUED IN
RESPECT OF, IN EXCHANGE FOR, OR SUBSTITUTION OF THE STOCK OR THE OPTIONS BY
REASON OF ANY STOCK DIVIDEND, SPLIT, REVERSE SPLIT, COMBINATION,
RECAPITALIZATION, LIQUIDATION, RECLASSIFICATION, MERGER, CONSOLIDATION OR
OTHERWISE.

 

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15.                                 MANAGEMENT STOCKHOLDER’S EMPLOYMENT BY THE
COMPANY.  NOTHING CONTAINED IN THIS AGREEMENT OR IN ANY OTHER AGREEMENT ENTERED
INTO BY THE COMPANY AND THE MANAGEMENT STOCKHOLDER CONTEMPORANEOUSLY WITH THE
EXECUTION OF THIS AGREEMENT (SUBJECT TO, AND EXCEPT AS SET FORTH IN, THE
APPLICABLE PROVISIONS OF ANY OFFER LETTER OR LETTER OF EMPLOYMENT PROVIDED TO
THE MANAGEMENT STOCKHOLDER BY THE COMPANY OR ANY EMPLOYMENT AGREEMENT ENTERED BY
AND BETWEEN THE MANAGEMENT STOCKHOLDER AND THE COMPANY) (I) OBLIGATES THE
COMPANY OR ANY SUBSIDIARY OF THE COMPANY TO EMPLOY THE MANAGEMENT STOCKHOLDER IN
ANY CAPACITY WHATSOEVER OR (II) PROHIBITS OR RESTRICTS THE COMPANY (OR ANY SUCH
SUBSIDIARY) FROM TERMINATING THE EMPLOYMENT OF THE MANAGEMENT STOCKHOLDER AT ANY
TIME OR FOR ANY REASON WHATSOEVER, WITH OR WITHOUT CAUSE, AND THE MANAGEMENT
STOCKHOLDER HEREBY ACKNOWLEDGES AND AGREES THAT NEITHER THE COMPANY NOR ANY
OTHER PERSON HAS MADE ANY REPRESENTATIONS OR PROMISES WHATSOEVER TO THE
MANAGEMENT STOCKHOLDER CONCERNING THE MANAGEMENT STOCKHOLDER’S EMPLOYMENT OR
CONTINUED EMPLOYMENT BY THE COMPANY OR ANY SUBSIDIARY OF THE COMPANY.

 

16.                                 BINDING EFFECT.  THE PROVISIONS OF THIS
AGREEMENT SHALL BE BINDING UPON AND ACCRUE TO THE BENEFIT OF THE PARTIES HERETO
AND THEIR RESPECTIVE HEIRS, LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS.  IN
THE CASE OF A TRANSFEREE PERMITTED UNDER SECTION 2(A) OR SECTION 3 (OTHER THAN
CLAUSES (C) OR (D) THEREOF) HEREOF, SUCH TRANSFEREE SHALL BE DEEMED THE
MANAGEMENT STOCKHOLDER HEREUNDER; PROVIDED, HOWEVER, THAT NO TRANSFEREE
(INCLUDING WITHOUT LIMITATION, TRANSFEREES REFERRED TO IN SECTION 2(A) OR
SECTION 3 HEREOF) SHALL DERIVE ANY RIGHTS UNDER THIS AGREEMENT UNLESS AND UNTIL
SUCH TRANSFEREE HAS DELIVERED TO THE COMPANY A VALID UNDERTAKING AND BECOMES
BOUND BY THE TERMS OF THIS AGREEMENT.

 

17.                                 AMENDMENT.  THIS AGREEMENT MAY BE AMENDED
ONLY BY A WRITTEN INSTRUMENT SIGNED BY THE PARTIES HERETO.

 

18.                                 CLOSING.  EXCEPT AS OTHERWISE PROVIDED
HEREIN, THE CLOSING OF EACH PURCHASE AND SALE OF SHARES OF STOCK PURSUANT TO
THIS AGREEMENT SHALL TAKE PLACE AT THE PRINCIPAL OFFICE OF THE COMPANY ON THE
TENTH BUSINESS DAY FOLLOWING DELIVERY OF THE NOTICE BY EITHER PARTY TO THE OTHER
OF ITS EXERCISE OF THE RIGHT TO PURCHASE OR SELL SUCH STOCK HEREUNDER.

 

19.                                 APPLICABLE LAW; JURISDICTION; ARBITRATION;
LEGAL FEES.

 

(A)                                  THE LAWS OF THE STATE OF DELAWARE
APPLICABLE TO CONTRACTS EXECUTED AND TO BE PERFORMED ENTIRELY IN SUCH STATE
SHALL GOVERN THE INTERPRETATION, VALIDITY AND PERFORMANCE OF THE TERMS OF THIS
AGREEMENT.

 

(B)                                 IN THE EVENT OF ANY CONTROVERSY AMONG THE
PARTIES HERETO ARISING OUT OF, OR RELATING TO, THIS AGREEMENT WHICH CANNOT BE
SETTLED AMICABLY BY THE PARTIES, SUCH CONTROVERSY SHALL BE FINALLY, EXCLUSIVELY
AND CONCLUSIVELY SETTLED BY MANDATORY ARBITRATION CONDUCTED EXPEDITIOUSLY IN
ACCORDANCE WITH THE AMERICAN ARBITRATION ASSOCIATION RULES BY A SINGLE
INDEPENDENT ARBITRATOR.  SUCH ARBITRATION PROCESS SHALL TAKE PLACE WITHIN 100
MILES OF THE NEW YORK CITY METROPOLITAN AREA.  THE DECISION OF THE ARBITRATOR
SHALL BE FINAL AND BINDING UPON ALL PARTIES HERETO AND SHALL BE RENDERED
PURSUANT TO A WRITTEN DECISION, WHICH CONTAINS A DETAILED RECITAL OF THE
ARBITRATOR’S REASONING.  JUDGMENT UPON THE AWARD RENDERED MAY BE ENTERED IN ANY
COURT HAVING JURISDICTION THEREOF.

 

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(C)                                  NOTWITHSTANDING THE FOREGOING, THE
MANAGEMENT STOCKHOLDER ACKNOWLEDGES AND AGREES THAT THE COMPANY, ITS
SUBSIDIARIES, THE INVESTORS AND ANY OF THEIR RESPECTIVE RULE 405 AFFILIATES
SHALL BE ENTITLED TO INJUNCTIVE OR OTHER RELIEF IN ORDER TO ENFORCE THE COVENANT
NOT TO COMPETE, COVENANT NOT TO SOLICIT AND/OR CONFIDENTIALITY COVENANTS AS SET
FORTH IN SECTION 24(A) OF THIS AGREEMENT.

 

(D)                                 IN THE EVENT OF ANY ARBITRATION OR OTHER
DISPUTES WITH REGARD TO THIS AGREEMENT OR ANY OTHER DOCUMENT OR AGREEMENT
REFERRED TO HEREIN, EACH PARTY SHALL PAY ITS OWN LEGAL FEES AND EXPENSES, UNLESS
OTHERWISE DETERMINED BY THE ARBITRATOR.

 

20.                                 ASSIGNABILITY OF CERTAIN RIGHTS BY THE
COMPANY.  THE COMPANY SHALL HAVE THE RIGHT TO ASSIGN ANY OR ALL OF ITS RIGHTS OR
OBLIGATIONS TO PURCHASE SHARES OF STOCK PURSUANT TO SECTIONS 4, 5 AND 6 HEREOF.

 

21.                                 MISCELLANEOUS.

 

(A)                                  IN THIS AGREEMENT ALL REFERENCES TO
“DOLLARS” OR “$” ARE TO UNITED STATES DOLLARS AND THE MASCULINE PRONOUN SHALL
INCLUDE THE FEMININE AND NEUTER, AND THE SINGULAR THE PLURAL, WHERE THE CONTEXT
SO INDICATES

 

(B)                                 IF ANY PROVISION OF THIS AGREEMENT SHALL BE
DECLARED ILLEGAL, VOID OR UNENFORCEABLE BY ANY COURT OF COMPETENT JURISDICTION,
THE OTHER PROVISIONS SHALL NOT BE AFFECTED, BUT SHALL REMAIN IN FULL FORCE AND
EFFECT.

 

22.                                 WITHHOLDING.  THE COMPANY OR ITS
SUBSIDIARIES SHALL HAVE THE RIGHT TO DEDUCT FROM ANY CASH PAYMENT MADE UNDER
THIS AGREEMENT TO THE APPLICABLE MANAGEMENT STOCKHOLDER ENTITIES ANY MINIMUM
FEDERAL, STATE OR LOCAL INCOME OR OTHER TAXES REQUIRED BY LAW TO BE WITHHELD
WITH RESPECT TO SUCH PAYMENT.

 

23.                                 NOTICES.  ALL NOTICES AND OTHER
COMMUNICATIONS PROVIDED FOR HEREIN SHALL BE IN WRITING.  ANY NOTICE OR OTHER
COMMUNICATION HEREUNDER SHALL BE DEEMED DULY GIVEN (I) UPON ELECTRONIC
CONFIRMATION OF FACSIMILE, (II) ONE BUSINESS DAY FOLLOWING THE DATE SENT WHEN
SENT BY OVERNIGHT DELIVERY AND (III) FIVE (5) BUSINESS DAYS FOLLOWING THE DATE
MAILED WHEN MAILED BY REGISTERED OR CERTIFIED MAIL RETURN RECEIPT REQUESTED AND
POSTAGE PREPAID, IN EACH CASE AS FOLLOWS:

 

(A)                                  IF TO THE COMPANY, TO IT AT THE FOLLOWING
ADDRESS:

 

Visant Holding Corp.
One Byram Brook Place, Suite 202
Armonk, NY  10504
Attention:  General Counsel
Telecopy: (914) 595-8237

 

WITH COPIES TO:

 

Kohlberg Kravis Roberts & Co.

9 West 57th Street

 

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New York, New York 10019
Attention:  Alexander Navab
Telecopy: (212) 750-0003

 

and

 

DLJ Merchant Banking III, Inc.
Eleven Madison Avenue
New York, NY 10010
Attention:  Thompson Dean
Telecopy: (212) 538-0415

 

and

 

Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017
Attention:  Gary I. Horowitz, Esq.

Telecopy:  (212) 455-2502

 

and

 

Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Attention:  Douglas P. Warner, Esq.
Telecopy:  (212) 310-8007

 

(B)                                 IF TO THE MANAGEMENT STOCKHOLDER, TO HIM AT
THE ADDRESS SET FORTH BELOW UNDER HIS SIGNATURE;

 

OR AT SUCH OTHER ADDRESS AS EITHER PARTY SHALL HAVE SPECIFIED BY NOTICE IN
WRITING TO THE OTHER.

 

24.                                 CONFIDENTIAL INFORMATION; COVENANT NOT TO
COMPETE.

 

(A)                                  IN CONSIDERATION OF THE COMPANY ENTERING
INTO THIS AGREEMENT WITH THE MANAGEMENT STOCKHOLDER, THE MANAGEMENT STOCKHOLDER
HEREBY AGREES EFFECTIVE AS OF THE DATE OF THE MANAGEMENT STOCKHOLDER’S
COMMENCEMENT OF EMPLOYMENT WITH THE COMPANY OR ITS SUBSIDIARIES, WITHOUT THE
COMPANY’S PRIOR WRITTEN CONSENT, THE MANAGEMENT STOCKHOLDER SHALL NOT, DIRECTLY
OR INDIRECTLY, (I) AT ANY TIME DURING OR AFTER THE MANAGEMENT STOCKHOLDER’S
EMPLOYMENT WITH THE COMPANY OR ITS SUBSIDIARIES, DISCLOSE ANY CONFIDENTIAL
INFORMATION PERTAINING TO THE BUSINESS OF THE COMPANY OR ANY OF ITS
SUBSIDIARIES, EXCEPT WHEN REQUIRED TO PERFORM HIS OR HER DUTIES TO THE COMPANY
OR ONE OF ITS SUBSIDIARIES, BY LAW OR JUDICIAL PROCESS; OR (II) AT ANY TIME
DURING THE MANAGEMENT STOCKHOLDER’S EMPLOYMENT WITH THE COMPANY OR ITS
SUBSIDIARIES AND FOR A PERIOD OF TWO YEARS THEREAFTER, DIRECTLY OR INDIRECTLY
(A) ACT AS A PROPRIETOR, INVESTOR, DIRECTOR, OFFICER, EMPLOYEE, SUBSTANTIAL
STOCKHOLDER, CONSULTANT, OR PARTNER IN ANY BUSINESS THAT DIRECTLY OR INDIRECTLY
COMPETES, AT THE RELEVANT DETERMINATION DATE, WITH THE BUSINESS OF THE COMPANY
IN, (1) SCHOOL PHOTOGRAPHY SERVICES OR SCHOOL-RELATED CLOTHING, AFFINITY
PRODUCTS

 

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AND SERVICES, (2) COMMERCIAL PRINTING AND BINDING, (3) PRINTING SERVICES TO
COMPANIES ENGAGED IN DIRECT MARKETING, (4) FRAGRANCE, COSMETICS AND
TOILETRIES-RELATED SAMPLING OR (5) SINGLE USE PACKAGING FOR FRAGRANCES,
COSMETICS AND TOILETRIES, IN NORTH AMERICA IN THE CASE OF CLAUSES (1) THROUGH
(3) AND IN NORTH AMERICA AND EUROPE IN THE CASE OF CLAUSES (4) AND (5),
(B) SOLICIT CUSTOMERS OR CLIENTS OF THE COMPANY OR ANY OF ITS SUBSIDIARIES TO
TERMINATE THEIR RELATIONSHIP WITH THE COMPANY OR ANY OF ITS SUBSIDIARIES OR
OTHERWISE SOLICIT SUCH CUSTOMERS OR CLIENTS TO COMPETE WITH ANY BUSINESS OF THE
COMPANY OR ANY OF ITS SUBSIDIARIES OR (C) SOLICIT OR OFFER EMPLOYMENT TO ANY
PERSON WHO HAS BEEN EMPLOYED BY THE COMPANY OR ANY OF ITS SUBSIDIARIES AT ANY
TIME DURING THE TWELVE (12) MONTHS IMMEDIATELY PRECEDING THE TERMINATION OF THE
MANAGEMENT STOCKHOLDER’S EMPLOYMENT.  IF THE MANAGEMENT STOCKHOLDER IS BOUND BY
ANY OTHER AGREEMENT WITH THE COMPANY REGARDING THE USE OR DISCLOSURE OF
CONFIDENTIAL INFORMATION, THE PROVISIONS OF THIS AGREEMENT SHALL BE READ IN SUCH
A WAY AS TO FURTHER RESTRICT AND NOT TO PERMIT ANY MORE EXTENSIVE USE OR
DISCLOSURE OF CONFIDENTIAL INFORMATION.

 

(B)                                 NOTWITHSTANDING CLAUSE (A) ABOVE, IF AT ANY
TIME A COURT HOLDS THAT THE RESTRICTIONS STATED IN SUCH CLAUSE (A) ARE
UNREASONABLE OR OTHERWISE UNENFORCEABLE UNDER CIRCUMSTANCES THEN EXISTING, THE
PARTIES HERETO AGREE THAT THE MAXIMUM PERIOD, SCOPE OR GEOGRAPHIC AREA
DETERMINED TO BE REASONABLE UNDER SUCH CIRCUMSTANCES BY SUCH COURT WILL BE
SUBSTITUTED FOR THE STATED PERIOD, SCOPE OR AREA.  BECAUSE THE MANAGEMENT
STOCKHOLDER’S SERVICES ARE UNIQUE AND BECAUSE THE MANAGEMENT STOCKHOLDER HAS HAD
ACCESS TO CONFIDENTIAL INFORMATION, THE PARTIES HERETO AGREE THAT MONEY DAMAGES
WILL BE AN INADEQUATE REMEDY FOR ANY BREACH OF THIS AGREEMENT.  IN THE EVENT OF
A BREACH OR THREATENED BREACH OF THIS AGREEMENT, THE COMPANY OR ITS SUCCESSORS
OR ASSIGNS MAY, IN ADDITION TO OTHER RIGHTS AND REMEDIES EXISTING IN THEIR
FAVOR, APPLY TO ANY COURT OF COMPETENT JURISDICTION FOR SPECIFIC PERFORMANCE
AND/OR INJUNCTIVE RELIEF IN ORDER TO ENFORCE, OR PREVENT ANY VIOLATIONS OF, THE
PROVISIONS HEREOF (WITHOUT THE POSTING OF A BOND OR OTHER SECURITY).

 

(c)                                  In the event that the Management
Stockholder breaches any of the provisions of Section 24(a), in addition to all
other remedies that may be available to the Company, such Management Stockholder
shall be required to pay to the Company any amounts actually paid to him or her
by the Company in respect of any repurchase by the Company of the Option or
shares of Common Stock underlying the Option held by such Management
Stockholder.

 

25.                                 TERMINATION OF CERTAIN PROVISIONS.

 

The provisions contained in Section 4 and the portion of any other provision of
this Agreement that incorporates the provisions of Section 4, shall terminate,
and be of no further force or effect upon the consummation of a Qualified Public
Offering.

[Signatures on next page.]

 

23

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first above written.

 

 

VISANT HOLDING CORP.

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

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MANAGEMENT STOCKHOLDER:

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

ADDRESS:

 

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