Document:

mdvp_ex42.htm

EXHIBIT 4.2
  
 DESCRIPTION OF CAPITAL STOCK
  
 Our authorized capital stock consists of 100,000,000 shares of common stock, par value $0.001 per share and 25,000,000 shares of preferred stock, par value $0.001. As of March 23, 2022, there were 10,005,000 shares of common stock, and no shares of preferred stock, issued and outstanding.
  
 Common Stock
  
 Holders of our common stock are entitled to one vote per share. Our Articles of Incorporation do not provide for cumulative voting. Holders of our common stock are entitled to receive ratably such dividends, if any, as may be declared by our board of directors out of legally available funds. However, the current policy of our board of directors is to retain earnings, if any, for the operation and expansion of the Company. Upon liquidation, dissolution or winding-up, the holders of our common stock are entitled to share ratably in all of our assets which are legally available for distribution, after payment of or provision for all liabilities and the liquidation preference of any outstanding preferred stock. The holders of our common stock have no preemptive, subscription, redemption or conversion rights. 
  
 Preferred Stock
  
 Our Articles of Incorporation authorize the issuance of up to 25,000,000 shares of preferred stock with designations, rights and preferences as may be determined from time to time by our board of directors (commonly known as "blank check" preferred stock). The board of directors may, without stockholder approval, issue preferred stock with voting, dividend, liquidation and conversion rights that could dilute the voting strength of our common stockholder and may assist management in impeding an unfriendly takeover or attempted changes in control.Exhibit 10.1

 

Execution
Version

 

EMPLOYEE MATTERS AGREEMENT

 

This EMPLOYEE MATTERS AGREEMENT
(this “Agreement”), dated as of March 23, 2022, is entered into by and among Ligand Pharmaceuticals Incorporated,
a Delaware corporation (the “Company”), OmniAb, Inc., a Delaware corporation and a wholly owned subsidiary of
the Company (“SpinCo”), Avista Public Acquisition Corp. II, a Cayman Islands exempted company (which will migrate to
and domesticate as a Delaware corporation) (“Parent”), and Orwell Merger Sub Inc., a Delaware corporation and wholly
owned Subsidiary of Parent (“Merger Sub”). “Party” or “Parties” means the Company,
SpinCo, Parent or Merger Sub, individually or collectively, as the case may be. Capitalized terms used in this Agreement, but not otherwise
defined in this Agreement, the Separation Agreement or the Merger Agreement, shall have the meaning set forth in Section 1.1.

 

W I T N E S S E T H:

 

WHEREAS, the Company, acting
through its direct and indirect Subsidiaries, currently conducts the Company Retained Business and the SpinCo Business;

 

WHEREAS, the Company Board
has determined that it is appropriate, desirable and in the best interests of the Company and its stockholders to separate the Company
into two separate companies, one for each of (i) the Company Retained Business, which shall be owned and conducted, directly or indirectly,
by the Company and its Subsidiaries (other than SpinCo and its Subsidiaries) and (ii) the SpinCo Business, which shall be owned and
conducted, directly or indirectly, by SpinCo and its Subsidiaries, in the manner contemplated by the Separation and Distribution Agreement
by and among the Parties, dated as of the date hereof (the “Separation Agreement”) and the other Transaction Documents;

 

WHEREAS, following the Domestication
and the Separation and pursuant to the Merger Agreement, Merger Sub shall merge with and into SpinCo and SpinCo will be the surviving
corporation and a wholly owned Subsidiary of Parent; and

 

WHEREAS, in connection with
the transactions contemplated by the Separation Agreement and the Merger Agreement, the Parties have agreed to enter into this Agreement
for the purpose of allocating assets, Liabilities and responsibilities with respect to certain employee matters and employee compensation
and benefit plans and programs among them and to address certain other employment-related matters.

 

NOW, THEREFORE, in consideration
of the foregoing and the mutual agreements, provisions and covenants contained in this Agreement, the Parties hereby agree as follows:

 

Article I

DEFINITIONS AND INTERPRETATION

 

1.1             General.
As used in this Agreement, the following terms shall have the following meanings:

 

(a)            “401(k) Plan
Transition Date” shall mean (i) December 31 of the calendar year in which the Distribution Time occurs, or (ii) such
earlier date as mutually agreed by the Parties.

 

(b)            “Adjusted
Parent Equity Award” shall mean an Adjusted Parent Option, Adjusted Parent RSU Award or Adjusted Parent PSU Award.

 

     

     

    

 

(c)            “Adjusted
Parent Option” shall have the meaning set forth in Section 4.2(d).

 

(d)            “Adjusted
Parent PSU Award” shall have the meaning set forth in Section 4.4(f).

 

(e)            “Adjusted
Parent RSU Award” shall have the meaning set forth in Section 4.3(d).

 

(f)            “Agreement”
shall have the meaning set forth in the Preamble.

 

(g)            “Benefit
Plan” shall mean an “employee benefit plan” (within the meaning of Section 3(3) of ERISA but regardless
of whether such plan is subject to ERISA) and each compensation plan, program, agreement or arrangement, including each pension, retirement,
profit sharing, 401(k), severance, health and welfare, disability, deferred compensation, employment, termination, change-in-control,
retention, fringe benefit, stock purchase, cash bonus or equity-based incentive or other benefit plan, program, agreement, policy or other
arrangement, in each case, that is or was maintained for the benefit of current and/or former directors, officers, consultants or employees.

 

(h)            “Code”
means the Internal Revenue Code of 1986, as amended, or any successor federal income tax law. Reference to a specific Code provision also
includes any proposed, temporary or final regulation in force under that provision.

 

(i)            “Company”
shall have the meaning set forth in the Preamble.

 

(j)            “Company
2021 TSR PSU Award” shall mean a Company PSU Award granted in 2021 (or portion thereof) the vesting of which is tied to the
Company’s total shareholder return for the three-year performance period ending December 31, 2023.

 

(k)            “Company
401(k) Plan” shall mean the Company’s Section 401(k) Savings/Retirement Plan.

 

(l)            “Company
Allocation Factor” shall mean the quotient obtained by dividing (i) the Company Post-Adjustment Stock Value, by (ii) the
sum of (A) the Company Post-Adjustment Stock Value, plus (B) the product of (x) the SpinCo Stock Value times (y) the
Distribution Ratio.

 

(m)            “Company
Benefit Plan” shall mean any Benefit Plan sponsored, maintained or contributed to (or required to be contributed to) by any
member of the Company Group that (i) is or has been maintained, sponsored, contributed to or entered into by any member of the Company
Group for the benefit of any SpinCo Employee or SpinCo Independent Contractor or for which any member of the SpinCo Group could have any
Liability and (ii) that is not a SpinCo Benefit Plan.

 

(n)            “Company
Employee” shall mean each employee of the Company or any of its Subsidiaries or Affiliates who does not qualify as a SpinCo
Employee.

 

(o)            “Company
Employee List” shall have the meaning set forth in Section 2.2(d).

 

(p)            “Company
Equity Award” shall mean a Company Option, Company RSU Award or a Company PSU Award.

 

(q)            “Company
Equity Plan” shall mean the Company’s 2002 Stock Incentive Plan, as amended from time to time.

 

     

     

    

 

(r)            “Company
ESPP” shall mean the Company’s 2002 Employee Stock Purchase Plan, as amended from time to time.

 

(s)            “Company
Group” shall mean (i) the Company, the Company Retained Business and each Person that is a direct or indirect Subsidiary
of the Company as of immediately following the Distribution Time and (ii) each Business Entity that becomes a Subsidiary of the Company
after the Distribution Time.

 

(t)            “Company
Independent Contractor” shall mean each individual who is engaged as an independent contractor or consultant by the Company
or any of its Subsidiaries or Affiliates who does not qualify as a SpinCo Independent Contractor.

 

(u)            “Company
Individual Agreement” shall mean each Benefit Plan sponsored, maintained entered into or contributed to by the Company under
which no more than one service provider is eligible to receive compensation and/or benefits.

 

(v)            “Company
Option” shall mean an option to purchase shares of Company Common Stock granted pursuant to the Company Equity Plan.

 

(w)            “Company
Post-Adjustment Stock Value” shall mean the average closing price per share of Company Common Stock trading on an ex-dividend
basis on the Nasdaq Stock Market during regular trading hours for the five (5) trading days ending on the date on which the Distribution
Time occurs (or, if the Distribution Time occurs prior to regular trading hours, for the five (5) trading days ending on the date
prior to the date on which the Distribution Time occurs).

 

(x)            “Company
Pre-Adjustment Stock Value” shall mean the average closing price per share of Company Common Stock trading “regular way
with due bills” (if applicable) on the Nasdaq Stock Market during regular trading hours for the five (5) trading days ending
on the date on which the Distribution Time occurs (or, if the Distribution Time occurs prior to regular trading hours, for the five (5) trading
days ending on the date prior to the date on which the Distribution Time occurs).

 

(y)            “Company
PSU Award” shall mean a performance stock unit award granted pursuant to the Company Equity Plan.

 

(z)            “Company
Ratio” shall mean the quotient obtained by dividing the Company Pre-Adjustment Stock Value by the Company Post-Adjustment Stock
Value.

 

(aa)          “Company
RSU Award” shall mean a restricted stock unit award granted pursuant to the Company Equity Plan that vests solely based on the
continued employment or service of the recipient.

 

(bb)          “Company
Service Provider” shall mean a Company Employee, a Company Independent Contractor or a member of the Company Board.

 

(cc)          “Company
Severance Plan” shall mean the Company’s Amended and Restated Severance Plan, as amended from time to time.

 

(dd)          “Distribution
Ratio” shall mean the number of shares (and/or fraction of a share, expressed as a decimal) of SpinCo Common Stock to be distributed
in respect of one share of Company Common Stock in the Distribution, as determined by the Company.

 

     

     

    

 

(ee)          “Distribution
Time” shall mean the effective time of the Distribution pursuant to the Separation Agreement.

 

(ff)            “Effective
Time” shall mean the “Effective Time” as defined in the Merger Agreement.

 

(gg)          “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended.

 

(hh)          “Former
Company Service Provider” means (i) any individual (other than a SpinCo Employee or SpinCo Independent Contractor) who,
as of the Distribution Time is a former employee or independent contractor of the Company or any of its Subsidiaries, or (ii) any
individual who is a Company Employee or Company Independent Contractor as of the Distribution Time or thereafter who ceases to be an employee
or independent contractor of the Company or any of its Subsidiaries following the Distribution Time.

 

(ii)            “Former
SpinCo Service Provider” shall mean any individual who is a SpinCo Employee or SpinCo Independent Contractor as of the Distribution
Time and thereafter ceases to be an employee or independent contractor of the SpinCo Group following the Distribution Time.

 

(jj)            “Merger
Agreement” shall mean the Agreement and Plan of Merger, dated as of March 23, 2022, by and among the Company, SpinCo, Parent,
and Merger Sub.

 

(kk)          “Parent”
shall have the meaning set forth in the Preamble.

 

(ll)             “Parent
Equity Plan” shall have the meaning set forth in Section 4.6.

 

(mm)          “Parent
Equity Plan Share Reserve” shall have the meaning set forth in Section 4.6.

 

(nn)          “Parent
ESPP” shall have the meaning set forth in Section 4.6.

 

(oo)         “Parent
ESPP Share Reserve” shall have the meaning set forth in Section 4.6.

 

(pp)          “Party”
and “Parties” shall have the meanings set forth in the Preamble.

 

(qq)          “Plan
Transition Date” shall mean the date that is the earlier to occur of (i) January 1, 2023 or (ii) such earlier
date as agreed among the Parties.

 

(rr)          “SpinCo”
shall have the meaning set forth in the Preamble.

 

(ss)          “SpinCo
401(k) Plan” shall have the meaning set forth in Section 3.3(b).

 

(tt)           “SpinCo
Allocation Factor” shall mean the quotient obtained by dividing (i) the product of (A) the SpinCo Stock Value times
(B) the Distribution Ratio, by (ii) the sum of (A) the Company Post-Adjustment Stock Value, plus (B) the product of
(x) the SpinCo Stock Value times (y) the Distribution Ratio.

 

(uu)          “SpinCo
Benefit Plan” shall mean any Benefit Plan sponsored, maintained or contributed to exclusively by any member of the SpinCo Group.

 

     

     

    

 

(vv)          “SpinCo
Common Stock” shall mean the common stock, par value $0.001 per share, of SpinCo.

 

(ww)          “SpinCo
Employee” shall mean each individual listed on the SpinCo Employee List.

 

(xx)            “SpinCo
Employee List” shall have the meaning set forth in Section 2.2(d).

 

(yy)          “SpinCo
Equity Award” shall mean a SpinCo Option, SpinCo RSU Award or SpinCo PSU Award.

 

(zz)          “SpinCo
Equity Plans” shall have the meaning set forth in Section 4.5.

 

(aaa)        “SpinCo
Group” shall mean SpinCo and each SpinCo Entity as of the Distribution Time (but after giving effect to the Separation), and,
following the Effective Time, Parent and each Person that becomes a Subsidiary of Parent or SpinCo thereafter, provided, however, that
for the avoidance of doubt, no member of the Company Group shall be treated as a member of the SpinCo Group.

 

(bbb)       “SpinCo
Independent Contractor” shall mean each individual engaged as an independent contractor or consultant by the SpinCo Group as
of the Distribution Time.

 

(ccc)        “SpinCo
Individual Agreement” shall mean each Benefit Plan sponsored, maintained entered into or contributed to by SpinCo under which
no more than one service provider is eligible to receive compensation and/or benefits.

 

(ddd)       “SpinCo
Option” shall mean an option to purchase shares of SpinCo Common Stock issued pursuant to the SpinCo Equity Plans as part of
an equitable adjustment to a Company Option made in connection with the Distribution.

 

(eee)        “SpinCo
PSU Award” shall mean an award of restricted stock units covering SpinCo Common Stock issued pursuant to the SpinCo Equity Plans
as part of an equitable adjustment to a Company PSU Award made in connection with the Distribution.

 

(fff)          “SpinCo
Ratio” shall mean the quotient obtained by dividing the Company Pre-Adjustment Stock Value by the SpinCo Stock Value.

 

(ggg)       “SpinCo
RSU Award” shall mean an award of restricted stock units covering SpinCo Common Stock that vests solely based on the continued
employment or service of the recipient issued pursuant to the SpinCo Equity Plans as part of an equitable adjustment to a Company RSU
Award made in connection with the Distribution.

 

(hhh)        “SpinCo
Service Provider” shall mean a SpinCo Employee, a SpinCo Independent Contractor or a member of the board of directors of SpinCo,
or any individual independent contractor, consultant or director who is reasonably expected to become a SpinCo Service Provider prior
to the Distribution Time.

 

(iii)            “SpinCo
Severance Plan” shall have the meaning set forth in Section 5.2(a).

 

(jjj)           “SpinCo
Stock Value” shall mean (i) the Base Exchange Ratio, multiplied by (ii) $10 per share.

 

     

     

    

 

(kkk)         “Separation
Agreement” shall have the meaning set forth in the Recitals.

 

(lll)            “Specified
Service Provider” shall mean a Company Service Provider or SpinCo Service Provider who, in either case, is set forth on Schedule
C attached hereto.

 

1.2            References;
Interpretation. References in this Agreement to any gender include references to all genders, and references to the singular include
references to the plural and vice versa. Unless the context otherwise requires, the words “include”, “includes”
and “including” when used in this Agreement shall be deemed to be followed by the phrase “without limitation”.
Unless the context otherwise requires, references in this Agreement to Articles, Sections, Annexes, Exhibits and Schedules shall be deemed
references to Articles and Sections of, and Annexes, Exhibits and Schedules to, this Agreement. Unless the context otherwise requires,
the words “hereof”, “hereby” and “herein” and words of similar meaning when used in this Agreement
refer to this Agreement in its entirety and not to any particular Article, Section or provision of this Agreement. The words “written
request” when used in this Agreement shall include email. Reference in this Agreement to any time shall be to New York City, New
York time unless otherwise expressly provided herein. Unless the context requires otherwise, references in this Agreement to the “Company”
shall also be deemed to refer to the applicable member of the Company Group, references to “SpinCo” shall also be deemed to
refer to the applicable member of the SpinCo Group (including, with respect to periods of time following the Effective Time, Parent),
and, in connection therewith, any references to actions or omissions to be taken, or refrained from being taken, as the case may be, by
the Company or SpinCo shall be deemed to require the Company, SpinCo or Parent, as the case may be, to cause the applicable members of
the Company Group or the SpinCo Group, respectively, to take, or refrain from taking, any such action. In the event of any inconsistency
or conflict which may arise in the application or interpretation of any of the definitions set forth in Section 1.1, for the
purpose of determining what is and is not included in such definitions, any item explicitly included on a Schedule referred to in any
such definition shall take priority over any provision of the text thereof.

 

Article II

GENERAL PRINCIPLES

 

2.1            Nature
of Liabilities. All Liabilities assumed or retained by a member of the Company Group under this Agreement shall be “Ligand Retained
Liabilities” for purposes of the Separation Agreement. All Liabilities assumed or retained by a member of the SpinCo Group under
this Agreement shall be “OmniAb Liabilities” for purposes of the Separation Agreement.

 

2.2            Transfers
of Employees and Independent Contractors Generally.

 

(a)            Schedule
A attached hereto sets forth a complete list of each Company Employee as of the date hereof (the “Company Employee List”),
and Schedule B attached hereto sets forth a complete list of each employee of the Company Group whose employment will be transferred
to SpinCo prior to the Distribution Time (the “SpinCo Employee List”). The Company and SpinCo shall mutually update
the Company Employee List and the SpinCo Employee List from time to time between the date hereof and the Distribution Time to remove terminated
employees and to add any new Company Employees or SpinCo Employees hired following the date hereof.

 

(b)            All
SpinCo Employees who are employed by the SpinCo Group as of the Distribution Time shall continue to be employees of the SpinCo Group immediately
after the Distribution Time. The Company and SpinCo will cooperate to cause each of the SpinCo Employees to be employed by a member of
the SpinCo Group prior to the Distribution Time.

 

     

     

    

 

(c)            The
Company and SpinCo will cooperate to cause the contract of any individual who is engaged as an independent contractor or consultant and
who provides services on behalf of the SpinCo Business to the extent of such service, to be transferred to a member of the SpinCo Group
prior to the Distribution Time.

 

(d)            The
Company Group and SpinCo Group agree to execute, and to seek to have the applicable SpinCo Employees execute, such documentation, if any,
as may be necessary to reflect the transfers described in this Section 2.2.

 

2.3            Assumption
and Retention of Liabilities Generally.

 

(a)            Except
as pursuant to this Agreement, from and after the Distribution Time, the Company shall, or shall cause one or more members of the Company
Group to, accept, assume (or, as applicable, retain) and perform, discharge and fulfill (i) all Liabilities under all Company Benefit
Plans with respect to Company Employees, Former Company Service Providers and their respective dependents and beneficiaries (and any alternate
payees in respect thereof), whenever incurred, unless this Agreement expressly provides for such Liabilities to be assumed by the SpinCo
Group or subject to reimbursement by the SpinCo Group; (ii) all Liabilities with respect to the employment, service, termination
of employment or termination of service of all Company Employees, Former Company Service Providers and their respective dependents and
beneficiaries (and any alternate payees in respect thereof), in each case to the extent arising in connection with or as a result of employment
with or the performance of services to any member of the Company Group; and (iii) all other Liabilities or obligations expressly
assigned to or assumed by a member of the Company Group under this Agreement.

 

(b)            Except
as pursuant to this Agreement, from and after the Distribution Time, SpinCo shall, or shall cause one or more members of the SpinCo Group
to, accept, assume (or, as applicable, retain) and perform, discharge and fulfill (i) all Liabilities under all SpinCo Benefit Plans,
whenever incurred; (ii) all Liabilities with respect to the employment, service, termination of employment or termination of service
of all SpinCo Employees, Former SpinCo Service Providers and SpinCo Independent Contractors and their respective dependents and beneficiaries
(and any alternate payees in respect thereof), in each case to the extent arising in connection with or as a result of employment with
or the performance of services to any member of the SpinCo Group or the Company Group; and (iii) all other Liabilities or obligations
expressly assigned to or assumed by a member of the SpinCo Group under this Agreement.

 

(c)            The
Parties shall promptly reimburse one another, upon reasonable request of the Party requesting reimbursement and the presentation by such
Party of such substantiating documentation as the other Party shall reasonably request, for the cost of any obligations or Liabilities
satisfied or assumed by the Party requesting reimbursement or its Affiliates that are, or that have been made pursuant to this Agreement,
the responsibility of the other Parties or any of its Affiliates.

 

(d)            Notwithstanding
any provision of this Agreement or the Separation Agreement to the contrary, SpinCo shall, or shall cause one or more members of the SpinCo
Group to, accept, assume (or, as applicable, retain) and perform, discharge and fulfill all Liabilities that have been accepted, assumed
or retained under this Agreement.

 

2.4            Treatment
of Compensation and Benefit Plans; Terms of Employment. Except as otherwise (i) required by applicable Law, or (ii) expressly
provided for in this Agreement, for a period of twelve (12) months following the Distribution Time (or if shorter, during the period of
employment), SpinCo shall, or shall cause a member of the SpinCo Group to provide or cause to be provided to each SpinCo Employee (A) a
base salary or hourly wage rate, as applicable, that is at least equal to the base salary or hourly wage rate provided to such SpinCo
Employee immediately prior to the Distribution Time, (B) subject to Section 5.1, a cash incentive or sales commission opportunity
no less favorable than the cash incentive or sales commission opportunity in effect for such SpinCo Employee, if any, immediately prior
to the Distribution Time, (C) health, welfare and retirement benefits that are substantially similar in the aggregate to those provided
to such SpinCo Employee immediately prior to the Distribution Time, and (D) severance benefits (including severance payments, transition
payments and continued health coverage) that are substantially similar to those provided to such SpinCo Employee immediately prior to
the Distribution Time.

 

     

     

    

 

2.5            Participation
in Company Benefit Plans. Except as otherwise provided pursuant to this Agreement or as required by Applicable Law, effective no later
than the Plan Transition Date, (i) SpinCo and each member of the SpinCo Group, to the extent applicable, shall cease to be a participating
company in any Company Benefit Plan and (ii) each then active SpinCo Employee shall cease to participate in, be covered by, accrue
benefits under, be eligible to contribute to or have any rights under any Company Benefit Plan (except to the extent of previously accrued
obligations that remain a Liability of any member of the Company Group pursuant to this Agreement).

 

2.6            Service
Recognition.

 

(a)            From
and after the Distribution Time, and in addition to any applicable obligations under applicable Law, SpinCo shall, and shall cause each
member of the SpinCo Group to, give each SpinCo Employee full credit for purposes of eligibility, vesting, and determination of level
of benefits under any SpinCo Benefit Plan for such SpinCo Employee’s prior service with any member of the Company Group or SpinCo
Group or any predecessor thereto, to the same extent such service was recognized by the applicable Company Benefit Plan; provided,
that, such service shall not be recognized to the extent it would result in the duplication of benefits or accruals under any defined
benefit pension plan.

 

(b)            Except
to the extent prohibited by applicable Law, as soon as administratively practicable on or after the Plan Transition Date with respect
to any applicable SpinCo Benefit Plan that is a health or welfare benefit plan: (i) SpinCo shall waive or cause to be waived all
limitations as to preexisting conditions or waiting periods with respect to participation and coverage requirements applicable to each
SpinCo Employee under any SpinCo Benefit Plan in which SpinCo Employees participate (or are eligible to participate) to the same extent
that such conditions and waiting periods were satisfied or waived under an analogous Company Benefit Plan, and (ii) SpinCo shall
use commercially reasonable efforts to provide or cause each SpinCo Employee to be provided with credit for any co-payments, deductibles
or other out-of-pocket amounts paid during the plan year in which the SpinCo Employees become eligible to participate in the SpinCo Benefit
Plans in satisfying any applicable co-payments, deductibles or other out-of-pocket requirements under any such plans for such plan year.

 

2.7            WARN.
Notwithstanding anything set forth in this Agreement to the contrary, none of the transactions contemplated by or undertaken by this Agreement
is intended to and shall not constitute or give rise to an “employment loss” or employment separation within the meaning of
the federal Worker Adjustment and Retraining Notification (WARN) Act, or any other federal, state, or local law or legal requirement addressing
mass employment separations.

 

2.8            No
Termination; No Change in Control. No Company Employee or SpinCo Employee shall be deemed to (a) terminate employment or service
solely by virtue of the consummation of the Distribution, any transfer of employment or other service relationship contemplated hereby,
or any related transactions or events contemplated by the Separation Agreement, this Agreement, the Merger Agreement, or any other Transaction
Document, or (b) become entitled to any severance, termination, separation or similar rights, payments or benefits, whether under
any Benefit Plan, the Company Equity Plan, the SpinCo Equity Plans, the Company Severance Plan, any Company Individual Agreement or any
other compensatory agreement or arrangement maintained by the Company or SpinCo or otherwise, in connection with any of the foregoing.
The Parties hereto agree that none of the transactions contemplated by the Separation Agreement, the Merger Agreement, or this Agreement,
constitutes a “change in control,” “change of control” or similar term, as applicable, within the meaning of any
Benefit Plan, the Company Equity Plan, the SpinCo Equity Plans, the Company Severance Plan, any Company Individual Agreement or any other
compensatory agreement or arrangement maintained by the Company or SpinCo.

 

     

     

    

 

Article III

CERTAIN BENEFIT PLAN PROVISIONS

 

3.1            Health
and Welfare Benefit Plans.

 

(a)            (i) Effective
as of the Plan Transition Date, the participation of each then-active SpinCo Employee who is a participant in a Company Benefit Plan shall
automatically cease and (ii) SpinCo shall or shall cause a member of the SpinCo Group to (A) have in effect, no later than the
Business Day immediately prior to the Plan Transition Date, SpinCo Benefit Plans providing health and welfare benefits for the benefit
of each such SpinCo Employee with terms that are substantially similar to those provided to the applicable SpinCo Employee immediately
prior to the date on which such SpinCo Benefit Plans become effective; and (B) effective on and after the Plan Transition Date, fully
perform, pay and discharge all claims of SpinCo Employees or Former SpinCo Service Providers, including but not limited to any claims
incurred under any Company Benefit Plan (to the extent not fully covered by insurance) on or prior to the date on which such SpinCo Benefit
Plans become effective, that remain unpaid as of the date on which such SpinCo Benefit Plans become effective, regardless of whether any
such claim was presented for payment prior to, on or after such date.

 

(b)            Without
duplication of amounts otherwise already covered in this Agreement or the Transition Services Agreement, the applicable member of the
SpinCo Group shall reimburse the Company or the applicable Company Benefit Plan in the ordinary course of business consistent with past
practice for any premiums and its proportionate share of any administrative or services costs related to SpinCo Employees or Former SpinCo
Service Providers paid by a Company Benefit Plan (whether prior to or after the Distribution Time) and not charged back to the appropriate
and applicable member of the SpinCo Group prior to the Plan Transition Date.

 

(c)            Notwithstanding
anything to the contrary in this Section 3.1, SpinCo Employees will continue to be considered to be “participants” in
any Company Benefit Plan that is either a health care flexible spending account program or a dependent-care flexible spending account
program for the duration of any grace period and/or claims run-out period following the calendar year in which the Plan Transition Date
occurs (in either case, solely as provided under the terms of such Company Benefit Plans), provided that such SpinCo Employees will be
considered to be participants solely for purposes of utilizing such grace period and/or claims run-out period; will not be allowed to
make any deferral or contribution elections under such Company Benefit Plans beyond the Plan Transition Date; and will cease to be participants
in such Company Benefit Plans upon the expiration of any grace period and/or claims run-out period. Effective as of the Plan Transition
Date, SpinCo shall establish a health care flexible spending account program or a dependent-care flexible spending account program for
SpinCo Employees.

 

     

     

    

 

3.2            Disability.

 

(a)            To
the extent any SpinCo Employee is, as of the Plan Transition Date, receiving payments as part of any short-term disability program that
is part of a Company Benefit Plan, such SpinCo Employee’s rights to continued short-term disability benefits (a) will end under
any Company Benefit Plan as of the Plan Transition Date; and (b) all remaining rights will be recognized under a SpinCo Benefit Plan
as of the Plan Transition Date, and the remainder (if any) of such SpinCo Employee’s short-term disability benefits will be paid
by a SpinCo Benefit Plan. In the event that any SpinCo Employee described above shall have any dispute with the short-term disability
benefits they are receiving under a SpinCo Benefit Plan, any and all appeal rights of such employees shall be realized through the SpinCo
Benefit Plan (and any appeal rights such SpinCo Employee may have under any Company Benefit Plan will be limited to benefits received
and time periods occurring prior to the Plan Transition Date). Any SpinCo Employee or Former SpinCo Service Provider who is receiving
short-term disability benefits under a Company Benefit Plan as of the Plan Transition Date and thereafter becomes entitled to long-term
disability benefits upon the expiration of such short-term disability period (whether under a Company Benefit Plan or SpinCo Benefit Plan),
shall be provided long-term disability benefits under the long-term disability plan which is a Company Benefit Plan.

 

(b)            For
any Former SpinCo Service Provider who is, as of the Distribution Time, receiving payments as part of any long-term disability program
that is part of a Company Benefit Plan, and has been receiving payments from such plan for twelve (12) months or fewer before the Distribution
Time, to the extent such Former SpinCo Service Provider may have any “return to work” rights under the terms of such Company
Benefit Plan, such Former SpinCo Service Provider’s eligibility for re-employment shall be with SpinCo or a member of the SpinCo
Group, subject to availability of a suitable position (with such availability to be determined in the sole discretion by SpinCo or the
applicable member of the SpinCo Group), provided however that, notwithstanding the foregoing, no Former SpinCo Service
Provider described in this subsection will be eligible for re-employment as described in this subsection after the first anniversary of
the Distribution Time.

 

3.3            401(k) Plans.

 

(a)            From
the Distribution Time and continuing until the 401(k) Plan Transition Date, SpinCo shall become an “adopting employer”
(as defined in the Company 401(k) Plan) and the Company 401(k) Plan shall provide for the SpinCo Group to participate in the
Company 401(k) Plan for the benefit of SpinCo Employees and Former SpinCo Service Providers, and the Company consents to such adoption
and maintenance, in accordance with the terms of the Company 401(k) Plan.

 

(b)     (i)     Effective
no later than the 401(k) Plan Transition Date, SpinCo shall establish a defined contribution savings plan and related trust that
satisfies the requirements of Sections 401(a) and 401(k) of the Code in which each SpinCo Employee who participated in the Company
401(k) Plan immediately prior thereto shall be eligible to participate (the “SpinCo 401(k) Plan”), with terms
that are substantially similar to those provided by the Company 401(k) Plan immediately prior to the date on which such SpinCo 401(k) Plan
become effective, (ii) the active participation of each SpinCo Employee who is a participant in the Company 401(k) Plan shall
automatically cease effective upon the date on which the SpinCo 401(k) Plan becomes effective, and (iii) as soon as practicable
after the SpinCo 401(k) Plan becomes effective, subject to the consent of the SpinCo 401(k) Plan administrator and reasonable
proof of qualification of the Company 401(k) Plan, the Company shall cause the accounts (including any outstanding participant loan
balances) in the Company 401(k) Plan attributable to SpinCo Employees and all of the assets in the Company 401(k) Plan related
thereto to be transferred in-kind to the SpinCo 401(k) Plan.

 

(c)            The
Company shall retain all accounts and all assets and Liabilities relating to the Company 401(k) Plan in respect of each Former SpinCo
Service Provider whose employment terminated prior to the 401(k) Plan Transition Date.

 

     

     

    

 

3.4            Chargeback
of Certain Costs. Without duplication of amounts otherwise already covered in this Agreement or the Transition Services Agreement,
nothing contained in this Agreement shall limit the Company’s ability to charge back any Liabilities that it incurs in respect of
any SpinCo Service Provider under a Company Benefit Plan which is a retirement plan or health or welfare benefit plan to any of its operating
companies in the ordinary course of business consistent with its past practices. Subject, and in addition, to the foregoing, the Company
shall allocate and charge back to SpinCo or a member of the SpinCo Group (without duplication) its proportionate share of Liabilities
(other than those arising from the Company’s or its agent’s gross misconduct or negligence) that the Company incurs by reason
of the continued participation of SpinCo Employees, SpinCo Independent Contractors and Former SpinCo Service Providers in such Company
Benefit Plans following the Distribution Time (which Liabilities shall, for the avoidance of doubt, be subject to reimbursement under
Section 2.3(c) of this Agreement).

 

Article IV

EQUITY INCENTIVE AWARDS

 

4.1            Equity
Awards. The Parties shall use commercially reasonable efforts to take all actions necessary or appropriate so that each outstanding
Company Equity Award and SpinCo Equity Award held by any individual shall be adjusted as set forth in this Article IV and in accordance
with applicable Law, the applicable equity plan and the applicable award agreement. The adjustments set forth below shall be the sole
adjustments made with respect to Company Equity Awards in connection with the Distribution. The adjustments set forth below shall be the
sole adjustments made with respect to SpinCo Equity Awards in connection with the Merger and are subject to the terms and conditions of
the Merger Agreement.

 

4.2            Treatment
of Company Options.

 

(a)            Company
Options Other than (i) Company Options Held by Former Company Service Providers or (ii) SpinCo Service Providers who are Specified
Service Providers. As determined by the Compensation Committee of the Company Board (the “Company Compensation Committee”)
pursuant to its authority under the Company Equity Plan, each Company Option outstanding as of immediately prior to the Distribution Time,
other than (x) any Company Option held by a Former Company Service Provider and (y) any Company Option held by a Specified Service
Provider, shall, immediately prior to the Distribution Time, be converted into both a SpinCo Option and a Company Option and shall otherwise
be, subject to Section 4.2(d) below, subject to the same terms and conditions after the Distribution Time as the terms and conditions
applicable to such Company Option immediately prior to the Distribution Time; provided, however, that from and after the
Distribution Time:

 

(i)            Shares
Subject to Post-Distribution Company Option. The number of shares of Company Common Stock subject to such Company Option shall be
equal to the product obtained by multiplying (I) the number of shares of Company Common Stock subject to such Company Option immediately
prior to the Distribution Time by (II) the Company Ratio by (III) the Company Allocation Factor, and rounding such result down
to the nearest whole share.

 

(ii)            Shares
Subject to Post-Distribution SpinCo Option. The number of shares of SpinCo Common Stock subject to such SpinCo Option shall be equal
to the product obtained by multiplying (I) the number of shares of Company Common Stock subject to the Company Option immediately
prior to the Distribution Time by (II) the SpinCo Ratio by (III) the SpinCo Allocation Factor, and rounding such result down
to the nearest whole share. Each SpinCo Option that is outstanding as of the Effective Time will be further adjusted to reflect the Transactions
as set forth in Section 4.2(d) below.

 

(iii)            Exercise
Price of Post-Distribution Company Option. The per share exercise price of such Company Option shall be equal to the quotient obtained
by dividing (I) the per share exercise price of such Company Option immediately prior to the Distribution Time by (II) the Company
Ratio, and rounding such quotient up to the nearest whole cent.

 

     

     

    

 

(iv)            Exercise
Price of Post-Distribution SpinCo Option. The per share exercise price of such SpinCo Option shall be equal to the quotient obtained
by dividing (I) the per share exercise price of the Company Option immediately prior to the Distribution Time by (II) the SpinCo
Ratio, and rounding such quotient up to the nearest whole cent. Each SpinCo Option that is outstanding as of the Effective Time will be
further adjusted to reflect the Transactions as set forth in Section 4.2(d) below.

 

(b)            Company
Options Held by (i) Former Company Service Providers and (ii) Specified Service Providers who are Company Service Providers.
As determined by the Company Compensation Committee pursuant to its authority under the Company Equity Plan, each Company Option outstanding
as of immediately prior to the Distribution Time (x) that is held by a Former Company Service Provider or (y) that is held by
a Specified Service Provider who is a Company Service Provider, shall be subject to the same terms and conditions after the Distribution
Time as the terms and conditions applicable to such Company Option immediately prior to the Distribution Time; provided, however,
that from and after the Distribution Time:

 

(i)            Shares
Subject to Post-Distribution Company Option. The number of shares of Company Common Stock subject to such Company Option shall be
equal to the product obtained by multiplying (A) the number of shares of Company Common Stock subject to such Company Option immediately
prior to the Distribution Time by (B) the Company Ratio, and rounding such product down to the nearest whole share.

 

(ii)            Exercise
Price of Post-Distribution Company Option. The per share exercise price of such Company Option shall be equal to the quotient obtained
by dividing (A) the per share exercise price of such Company Option immediately prior to the Distribution Time by (B) the Company
Ratio, and rounding such quotient up to the nearest whole cent.

 

(c)            Company
Options Held by Specified Service Providers who are SpinCo Service Providers. As determined by the Company Compensation Committee
pursuant to its authority under the Company Equity Plan, each Company Option outstanding as of immediately prior to the Distribution Time
that is held by a Specified Service Provider who is an SpinCo Service Provider, shall, immediately prior to the Distribution Time, be
converted solely into an SpinCo Option and shall otherwise be, subject to Section 4.2(d) below, subject to the same terms and
conditions after the Distribution Time as the terms and conditions applicable to such Company Option immediately prior to the Distribution
Time; provided, however, that from and after the Distribution Time:

 

(i)            Shares
Subject to Post-Distribution SpinCo Option. The number of shares of Company Common Stock subject to such SpinCo Option shall be equal
to the product obtained by multiplying (A) the number of shares of Company Common Stock subject to such Company Option immediately
prior to the Distribution Time by (B) the SpinCo Ratio, and rounding such product down to the nearest whole share. Each SpinCo Option
that is outstanding as of the Effective Time will be further adjusted to reflect the Transactions as set forth in Section 4.2(d) below.

 

(ii)            Exercise
Price of Post-Distribution SpinCo Option. The per share exercise price of such Company Option shall be equal to the quotient obtained
by dividing (A) the per share exercise price of such Company Option immediately prior to the Distribution Time by (B) the SpinCo
Ratio, and rounding such quotient up to the nearest whole cent. Each SpinCo Option that is outstanding as of the Effective Time will be
further adjusted to reflect the Transactions as set forth in Section 4.2(d) below.

 

     

     

    

 

(d)            SpinCo
Options Outstanding as of Immediately Prior to the Effective Time. As of the Effective Time, each SpinCo Option that is then outstanding
and unexercised shall be converted into the right to receive an option relating to shares of Domesticated Parent Common Stock upon substantially
the same terms and conditions as are in effect with respect to such option immediately prior to the Effective Time (other than terms that
have been rendered inoperative by the Transactions), including with respect to vesting and termination-related provisions (each, an “Adjusted
Parent Option”), except that (A) such Adjusted Parent Option shall relate to that whole number of shares of Domesticated
Parent Common Stock (rounded down to the nearest whole share) equal to the number of shares of SpinCo Common Stock subject to such SpinCo
Option, multiplied by the Base Exchange Ratio, and (B) the exercise price per share for each such Adjusted Parent Option shall be
equal to the exercise price per share of such SpinCo Option in effect immediately prior to the Effective Time, divided by the Base Exchange
Ratio (the exercise price per share, as so determined, being rounded up to the nearest full cent). In addition, at the Effective Time,
Parent will issue to each holder of a SpinCo Option a number of Earnout Shares equal to the product of (A) the number of shares of
SpinCo Common Stock subject to the SpinCo Option, multiplied by (B) the Earnout Exchange Ratio, which Earnout Shares will be subject
to the restrictions set forth in the Merger Agreement.

 

4.3            Treatment
of Company RSU Awards.

 

(a)            Company
RSU Awards Other than (i) Company RSU Awards Held by Former Company Service Providers and (ii) Company RSU Awards Held by Specified
Service Providers. As determined by the Company Compensation Committee pursuant to its authority under the Company Equity Plan, each
Company RSU Award outstanding as of immediately prior to the Distribution Time, other than (x) any Company RSU Award held by a Specified
Service Provider and (y) any Company RSU Award held by a Former Company Service Provider, shall, immediately prior to the Distribution
Time, be converted into both a SpinCo RSU Award and a Company RSU Award and shall otherwise be, subject to Section 4.3(d) below,
subject to the same terms and conditions after the Distribution Time as the terms and conditions applicable to such Company RSU Award
immediately prior to the Distribution Time; provided, however, that from and after the Distribution Time:

 

(i)            Shares
Subject to Post-Distribution Company RSU. The number of shares of Company Common Stock subject to such Company RSU Award shall be
equal to the number of shares of Company Common Stock subject to such Company RSU Award immediately prior to the Distribution Time, and

 

(ii)            Shares
Subject to Post-Distribution SpinCo RSU. The number of shares of SpinCo Common Stock subject to such SpinCo RSU Award shall be equal
to the product obtained by multiplying (A) the number of shares of Company Common Stock subject to the Company RSU Award immediately
prior to the Distribution Time by (B) the Distribution Ratio, and rounding such product down to the nearest whole share. Each SpinCo
RSU Award that is outstanding as of the Effective Time will be further adjusted to reflect the Transactions as set forth in Section 4.3(d) below.

 

(b)            Company
RSU Awards Held by (i) Former Company Service Providers or Former SpinCo Service Providers and (ii) Specified Service Providers
who are Company Service Providers. As determined by the Company Compensation Committee pursuant to its authority under the Company
Equity Plan, each Company RSU Award that is outstanding as of immediately prior to the Distribution Time (x) that is held by a Former
Company Service Provider or a Former SpinCo Service Provider or (y) that is held by a Specified Service Provider who is a Company
Service Provider, shall be subject to the same terms and conditions after the Distribution Time as the terms and conditions applicable
to such Company RSU Award immediately prior to the Distribution Time; provided, however, that from and after the Distribution
Time, the number of shares of Company Common Stock covered by such Company RSU Award held by the participant, as applicable, rounded to
the nearest whole share, shall be equal to the product obtained by multiplying (i) the number of shares of Company Common Stock covered
by such Company RSU Award immediately prior to the Distribution Time by (ii) the Company Ratio.

 

     

     

    

 

(c)            Company
RSU Awards Held by Specified Service Providers who are SpinCo Service Providers. As determined by the Company Compensation Committee
pursuant to its authority under the Company Equity Plan, each Company RSU Award that is outstanding as of immediately prior to the Distribution
Time that is held by a Specified Service Provider who is a SpinCo Service Provider shall, immediately prior to the Distribution Time,
be converted solely into a SpinCo RSU Award and shall otherwise be, subject to Section 4.3(d) below, subject to the same terms
and conditions after the Distribution Time as the terms and conditions applicable to such Company RSU Award immediately prior to the Distribution
Time; provided, however, that from and after the Distribution Time the number of shares of SpinCo Common Stock
subject to such SpinCo RSU Award shall be equal to the product obtained by multiplying (x) the number of shares of Company Common
Stock subject to the Company RSU Award immediately prior to the Distribution Time by (y) the SpinCo Ratio, and rounding down to the
nearest whole share. Each SpinCo RSU Award that is outstanding as of the Effective Time will be further adjusted to reflect the Transactions
as set forth in Section 4.3(d) below.

 

(d)            SpinCo
RSU Awards Outstanding as of the Effective Time. As of the Effective Time, each SpinCo RSU Award that is outstanding immediately prior
to the Effective Time shall be converted into the right to receive restricted stock units relating to shares of Domesticated Parent Common
Stock (each, an “Adjusted Parent RSU Award”) with substantially the same terms and conditions as were applicable to
such SpinCo RSU Award immediately prior to the Effective Time (other than terms that have been rendered inoperative by the Transactions),
including with respect to vesting and termination-related provisions, except that such Adjusted Parent RSU Award shall relate to that
whole number of shares of Domesticated Parent Common Stock as is equal to the product of (B) the number of shares of SpinCo Common
Stock subject to such SpinCo RSU Awards immediately prior to the Effective Time, multiplied by (B) the Base Exchange Ratio, with
any fractional shares rounded down to the nearest whole share. In addition, at the Effective Time, Parent will issue to each holder
of a SpinCo RSU Award a number of Earnout Shares equal to the product of (A) the number of shares of SpinCo Common Stock subject
to the SpinCo RSU Award, multiplied by (B) the Earnout Exchange Ratio, which Earnout Shares will be subject to the restrictions set
forth in the Merger Agreement.

 

4.4            Treatment
of Company PSU Awards.

 

(a)            Company
PSU Awards (Other than Company 2021 TSR PSU Awards) Not Held by Former Company Service Providers. As determined by the Company Compensation
Committee pursuant to its authority under the Company Equity Plan, each Company PSU Award outstanding as of immediately prior to the Distribution
Time, other than (x) any Company PSU Award held by a Former Company Service Provider and (y) any Company PSU Award that is a
Company 2021 TSR PSU Award, shall, immediately prior to the Distribution Time, be converted into both a SpinCo PSU Award and a Company
PSU Award and shall, subject to Sections 4.4(e) and (f) below, otherwise be subject to the same terms and conditions after the
Distribution Time as the terms and conditions applicable to such Company PSU Award immediately prior to the Distribution Time; provided, however,
that from and after the Distribution Time:

 

(i)            Shares
Subject to Post-Distribution Company PSU. The number of shares of Company Common Stock subject to such Company PSU Award shall be
equal to the number of shares of Company Common Stock subject to such Company PSU Award immediately prior to the Distribution Time, and

 

     

     

    

 

(ii)            Shares
Subject to Post-Distribution SpinCo PSU. The number of shares of SpinCo Common Stock subject to such SpinCo PSU Award shall be equal
to the product obtained by multiplying (A) the number of shares of Company Common Stock subject to the Company PSU Award immediately
prior to the Distribution Time by (B) the Distribution Ratio, and rounding such product down to the nearest whole share. Each SpinCo
PSU Award that is outstanding as of the Effective Time will be further adjusted to reflect the Transactions as set forth in Section 4.4(f) below.

 

(b)            Company
2021 TSR PSU Awards Not Held by Former Company Service Providers. As determined by the Company Compensation Committee pursuant to
its authority under the Company Equity Plan, each Company 2021 TSR PSU Award outstanding as of immediately prior to the Distribution Time,
other than any 2021 TSR PSU Award that is held by a Former Company Service Provider, shall, immediately prior to the Distribution Time,
be converted into both an SpinCo PSU Award and a Company PSU Award and shall, subject to Sections 4.4(e) and (f) below, otherwise
be subject to the same terms and conditions after the Distribution Time as the terms and conditions applicable to such Company PSU Award
immediately prior to the Distribution Time; provided, however, that from and after the Distribution Time:

 

(i)            Shares
Subject to Post-Distribution Company PSU. The number of shares of Company Common Stock subject to such Company PSU Award shall be
equal to (x) the number of shares of Company Common Stock subject to such Company 2021 TSR PSU Award immediately prior to the Distribution
Time, multiplied by (y) such percentage (not to exceed 200%) as is mutually determined by the Company and SpinCo prior to the Distribution
Time, and rounding such product down to the nearest whole share, and

 

(ii)            Shares
Subject to Post-Distribution SpinCo PSU. The number of shares of SpinCo Common Stock subject to such SpinCo PSU Award shall be equal
to the product obtained by multiplying (A) (x) the number of shares of Company Common Stock subject to the Company PSU Award
immediately prior to the Distribution Time, multiplied by (y) such percentage (not to exceed 200%) as is mutually determined by the
Company and SpinCo prior to the Distribution Time by (B) the Distribution Ratio, and rounding such product down to the nearest whole
share;

 

provided,
further, that from and after the Distribution Time, such Company 2021 TSR PSU Award shall no longer vest based on the performance objectives
applicable to such Company 2021 TSR PSU Award immediately prior to the Distribution Time and shall instead be amended to vest solely based
on continuous employment or service on December 31, 2023. Each SpinCo PSU Award that is outstanding as of the Effective Time will
be further adjusted to reflect the Transactions as set forth in Section 4.4(f) below.

 

(c)            Company
PSU Awards (Other than Company 2021 TSR PSU Awards) Held by Former Company Service Providers. As determined by the Company Compensation
Committee pursuant to its authority under the Company Equity Plan, each Company PSU Award that is not a Company 2021 TSR PSU Award and
is held by a Former Company Service Provider outstanding as of immediately prior to the Distribution Time shall be, subject to Sections
4.4(e) and (f) below, subject to the same terms and conditions after the Distribution Time as the terms and conditions applicable
to such Company PSU Award immediately prior to the Distribution Time; provided, however, that from and after the
Distribution Time, the number of shares of Company Common Stock covered by such Company PSU Award held by the participant, as applicable,
rounded to the nearest whole share, shall be equal to the product obtained by multiplying (i) the number of shares of Company Common
Stock covered by such Company PSU Award immediately prior to the Distribution Time by (ii) the Company Ratio.

 

     

     

    

 

(d)            Company
2021 TSR PSU Awards Held by Former Company Service Providers. As determined by the Company Compensation Committee pursuant to its
authority under the Company Equity Plan, each Company 2021 TSR PSU Award held by a Former Company Service Provider that is outstanding
as of immediately prior to the Distribution Time shall be, subject to Sections 4.4(e) and (f) below, subject to the same terms
and conditions after the Distribution Time as the terms and conditions applicable to such Company 2021 TSR PSU Award immediately prior
to the Distribution Time; provided, however, that from and after the Distribution Time, the number of shares of
Company Common Stock covered by such Company 2021 TSR PSU Award held by the participant, as applicable, rounded to the nearest whole share,
shall be equal to the product obtained by multiplying (i) the number of shares of Company Common Stock covered by such Company 2021
TSR PSU Award immediately prior to the Distribution Time by (ii) such percentage (not to exceed 200%) as is mutually determined by
the Company and SpinCo prior to the Distribution Time by (iii) the Company Ratio; provided, further, that from and after the Distribution
Time, such Company 2021 TSR PSU Award shall no longer vest based on the performance objectives applicable to such Company 2021 TSR PSU
Award immediately prior to the Distribution Time and shall instead be amended to vest solely based on continuous employment or service
on December 31, 2023.

 

(e)            Amendment
to Vesting Terms. Prior to the Distribution Time, the Company and SpinCo may mutually agree to amend the vesting terms of any or all
outstanding Company PSU Awards.

 

(f)            SpinCo
PSU Awards Outstanding as of the Effective Time. As of the Effective Time, each SpinCo PSU Award that is outstanding immediately prior
to the Effective Time shall be converted into the right to receive (i) performance-vesting restricted stock units relating to shares
of Domesticated Parent Common Stock (each, an “Adjusted Parent PSU Award”) with substantially the same terms and conditions
as were applicable to such SpinCo PSU Award immediately prior to the Effective Time (other than terms that have been rendered inoperative
by the Transactions), including with respect to vesting and termination-related provisions, except that such Adjusted Parent PSU Award
shall relate to that whole number of shares of Domesticated Parent Common Stock as is equal to the product of (A) the number of shares
of SpinCo Common Stock subject to such SpinCo PSU Awards immediately prior to the Effective Time, multiplied by (B) the Base Exchange
Ratio, with any fractional shares rounded down to the nearest whole share. Any performance targets to which an Adjusted Parent PSU Awards
are subject will be adjusted to reflect the Transactions contemplated hereby. In addition, at the Effective Time, Parent will issue
to each holder of a SpinCo PSU Award a number of Earnout Shares equal to the product of (A) the number of shares of SpinCo Common
Stock subject to the SpinCo PSU Award, multiplied by (B) the Earnout Exchange Ratio, which Earnout Shares will be subject to the
restrictions set forth in the Merger Agreement.

 

4.5            SpinCo
Equity Plans. Effective as of immediately prior to the Distribution Time, SpinCo shall have adopted the SpinCo 2022 Incentive Award
Plan (Company Service Provider Awards) and the SpinCo 2022 Incentive Award Plan (SpinCo Service Provider Awards) (the “SpinCo
Equity Plans”), which shall permit the grant and issuance of equity incentive awards denominated in SpinCo Common Stock as described
in this Article IV. In addition, prior to the Distribution Time, the Company shall approve the SpinCo Equity Plans as the sole stockholder
of SpinCo. As of the Effective Time, Parent will assume the SpinCo Equity Plans and all outstanding equity awards thereunder in accordance
with the terms of this Article IV.

 

     

     

    

 

4.6            Parent
Equity Plan and Parent ESPP. Prior to the Effective Time, Parent shall approve and adopt, subject to receipt of Parent Shareholder
Approval: (i) an incentive equity plan (the “Parent Equity Plan”); and (ii) an employee stock purchase plan
(the “Parent ESPP”), in each case, in form and substance reasonably acceptable to the Company and SpinCo in consultation
with Parent, and effective as of the Effective Time. The Parent Equity Plan will provide for the grant of awards of Domesticated Parent
Common Stock with a total pool of shares equal to (i) 14% of the aggregate number of Fully Diluted SpinCo Shares as of the Effective
Time, plus (ii) any shares which, as of the effective date of the Parent Equity Plan, are subject to Adjusted Parent Equity Awards
under the SpinCo Equity Plans which, on or following such effective date, become available for issuance under the Parent Equity Plan pursuant
to its terms, plus (iii) an annual “evergreen” increase of 5% of the shares of Parent Common Stock outstanding as of
the day prior to such increase (the “Parent Equity Plan Share Reserve”). The ESPP will provide for the grant of purchase
rights with respect to Domesticated Parent Common Stock with a total pool of shares equal to 1.5% of the aggregate number of Fully Diluted
SpinCo Shares as of the Effective Time, plus an annual “evergreen” increase of 1% of the shares of Parent Common Stock outstanding
as of the day prior to such increase (the “Parent ESPP Share Reserve”). As soon as reasonably practicable following
the expiration of the sixty (60) day period following the date Parent has filed current Form 10 information with the SEC reflecting
its status as an entity that is not a shell company, Parent shall file an effective registration statement on Form S-8 (or other
applicable form, including Form S-1 or Form S-3) with respect to the Domesticated Parent Common Stock issuable under the Parent
Equity Plan and the Parent ESPP, and Parent shall use commercially reasonable efforts to maintain the effectiveness of such registration
statement(s) (and maintain the current status of the prospectus or prospectuses contained therein) for so long as awards granted
pursuant to the Parent Equity Plan and the Parent ESPP remain outstanding.

 

4.7            Vesting;
Accelerated Vesting.

 

(a)            The
Distribution Time shall not constitute a termination of employment or service for any SpinCo Service Providers for purposes of any Company
Equity Award and, except as otherwise provided in this Agreement, with respect to grants adjusted pursuant to this Article IV, continued
employment with the SpinCo Group shall be treated as continued employment with the Company Group with respect to Company Equity Awards
held by SpinCo Service Providers and continued employment with the Company Group shall be treated as continued employment with the SpinCo
Group with respect to SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards) held by Company Service Providers.

 

(b)            Notwithstanding
the foregoing, with respect to any unvested SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards) granted
to a Company Service Provider in accordance with this Agreement, if the original Company Equity Award (that was partially adjusted into
the SpinCo Equity Award (or, following the Effective Time, Adjusted Parent Equity Award)) was subject, as of immediately prior to the
Distribution, to accelerated vesting provisions (i) by reference to a termination of employment or service with the Company and/or
(ii) in connection with a “Change in Control” (as defined in the applicable award agreement and/or Company Equity Plan)
of the Company, then the SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards) also shall be subject
to such same acceleration provisions upon the Company Service Provider’s termination of employment or service with the Company Group
and/or in connection with a “Change in Control” (as defined in the applicable award agreement and/or Company Equity Plan)
of the Company.

 

(c)            Further
notwithstanding the foregoing, with respect to any unvested Company Equity Awards or unvested SpinCo Equity Awards (or, following the
Effective Time, Adjusted Parent Equity Awards) granted to an SpinCo Service Provider in accordance with this Agreement, if the original
Company Equity Award (including any Company Equity Award that was solely or partially adjusted into the SpinCo Equity Award (or, following
the Effective Time, Adjusted Parent Equity Award)), was subject, as of immediately prior to the Distribution, to accelerated vesting provisions
(i) by reference to a termination of employment or service with the Company and/or (ii) in connection with a “Change in
Control” (as defined in the applicable award agreement and/or Company Equity Plan) of the Company, then the Company Equity Award
or SpinCo Equity Award (or, following the Effective Time, Adjusted Parent Equity Award), as applicable, also shall be subject to such
same acceleration provisions upon the SpinCo Service Provider’s termination of employment or service with the relevant member of
the SpinCo Group and/or in connection with a “Change in Control” (as defined in the applicable award agreement and/or SpinCo
Equity Plan) of SpinCo.

 

     

     

    

 

(d)            In
addition, with respect to any unvested SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards) held by
a Company Service Provider following the Distribution Time, notwithstanding anything herein or in the applicable award agreement to the
contrary, such SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards) will vest in full upon a “Change
in Control” (as defined in the applicable award agreement and/or SpinCo Equity Plans) of SpinCo (or, following the Effective Time,
Parent). Further, with respect to any unvested Company Equity Awards which are adjusted as of immediately prior to the Distribution Time
and continue to be held by a SpinCo Service Provider following the Distribution, in each case, in accordance with this Agreement, notwithstanding
anything herein or in the applicable award agreement to the contrary, such Company Equity Awards will vest in full upon a “Change
in Control” (as defined in the applicable award agreement and/or Company Equity Plan) of the Company.

 

(e)            Additionally,
notwithstanding anything herein or in the applicable award agreement to the contrary, if, following the Distribution Time, the Company
Board determines, in its discretion, to accelerate in full the vesting of all Company Equity Awards then held by Company Service Providers
and Former Company Service Providers (other than in connection with a “Change in Control” (as defined in the applicable award
agreement and/or Company Equity Plan)), the Company Board shall also accelerate in full the vesting of all outstanding Company Equity
Awards which are then held by SpinCo Service Providers and Former SpinCo Service Providers. Further notwithstanding anything herein or
in the applicable award agreement to the contrary, if, following the Distribution Time, the SpinCo Board or Parent Board determines, in
its discretion, to accelerate in full the vesting of all SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity
Awards) then held by SpinCo Service Providers and Former SpinCo Service Providers (other than in connection with a “Change in Control”
(as defined in the applicable award agreement and/or SpinCo Equity Plans)), the SpinCo Board or Parent Board shall also accelerate in
full the vesting of all outstanding SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards) which are then
held by Company Service Providers and Former Company Service Providers.

 

(f)            The
Parties hereto acknowledge and agree that in no event shall the vesting of any Company Equity Awards or SpinCo Equity Awards (or, following
the Effective Time, Adjusted Parent Equity Awards), in any case, accelerate solely by reason of the transactions or events contemplated
by the Separation Agreement, this Agreement, the Merger Agreement or any other Transaction Document.

 

4.8            General
Terms.

 

(a)            The
adjustments contemplated by this Article IV are all intended to comply in all respects with the requirements of Sections 409A and
424 of the Code, in each case, to the extent applicable, and all such provisions shall be interpreted and implemented in accordance with
the foregoing.

 

(b)            The
Parties shall use their commercially reasonable efforts to maintain effective registration statements with the Securities Exchange Commission
with respect to the awards described in this Article IV, to the extent any such registration statement is required by applicable
Law. For the avoidance of doubt, Parent shall use commercially reasonable efforts to file an effective registration statement on Form S-8
(or other applicable form, including Form S-1 or Form S-3) with respect to the Domesticated Parent Common Stock issuable under
the Adjusted Parent Equity Awards issuable under the SpinCo Equity Plans, and Parent shall use commercially reasonable efforts to maintain
the effectiveness of such registration statement(s) (and maintain the current status of the prospectus or prospectuses contained
therein) for so long as such awards remain outstanding.

 

(c)            The
Parties hereby acknowledge that the provisions of this Article IV are intended to achieve certain tax, legal and accounting objectives
and, in the event such objectives are not achieved, the Parties agree to negotiate in good faith regarding such other actions that may
be necessary or appropriate to achieve such objectives.

 

     

     

    

 

(d)            After
the Distribution Time, Company Equity Awards adjusted pursuant to this Article IV, regardless of by whom held, shall be settled by
the Company pursuant to the terms of the Company Equity Plan, and SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent
Equity Awards), regardless of by whom held, shall be settled by SpinCo or Parent (as applicable) pursuant to the terms of the SpinCo Equity
Plan. Accordingly, it is intended that, to the extent of the issuance of such SpinCo Equity Awards (or, following the Effective Time,
Adjusted Parent Equity Awards) and in connection with the adjustment provisions of this Article IV, the SpinCo Equity Plan shall
be considered a successor to the Company Equity Plan and to have assumed the obligations of the Company Equity Plan to make the adjustments
of the Company Equity Awards as set forth in this Article IV.

 

(e)            The
Parties acknowledge and agree that each of the applicable tax deductions for which they may be eligible for federal income tax purposes
with regard to the Company Equity Awards and SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards), in
any case, shall be determined in accordance with Revenue Ruling 2002-1.

 

(f)            By
approving the form, terms and conditions of, and the entrance by the Parties into, this Agreement, the Company Board, the SpinCo Board
and the Parent Board intend to exempt from the short-swing profit recovery provisions of Section 16(b) of the Exchange Act,
by reason of the application of Rule 16b−3 thereunder, all acquisitions and dispositions of Company Equity Awards, SpinCo Equity
Awards and/or Adjusted Parent Equity Awards by directors and executive officers of each of the Parties contemplated herein, and the Company
Board, the SpinCo Board and the Parent Board also intend to expressly approve, in respect of any Company Equity Awards, SpinCo Equity
Awards and/or Adjusted Parent Equity Awards, the use of any method for the payment of an exercise price and the satisfaction of any applicable
tax withholding (specifically including the actual or constructive tendering of shares in payment of an exercise price and the withholding
of shares from delivery in satisfaction of applicable tax withholding requirements) to the extent such method is permitted under the Company
Equity Plan or SpinCo Equity Plan (as applicable) and the applicable award agreement.

 

(g)            Each
of the Parties shall establish an appropriate administration system in order to handle, in an orderly manner that complies with applicable
Laws, (i) exercises of Ligand Options and SpinCo Options (or, following the Effective Time, Adjusted Parent Options), (ii) the
settlement of other Ligand Equity Awards and SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards), (iii) the
vesting of Ligand Equity Awards and SpinCo Equity Awards (or, following the Effective Time, Adjusted Parent Equity Awards) and (iv) the
satisfaction of applicable withholding taxes with respect to Ligand Equity Awards and SpinCo Equity Awards (or, following the Effective
Time, Adjusted Parent Equity Awards). The Parties shall work together to unify and consolidate all indicative data and payroll and employment
information on regular timetables and make certain that each applicable entity’s data and records in respect of such awards are
correct and updated on a timely basis. The foregoing shall include employment status and information required for tax withholding/remittance
and reporting, compliance with trading windows and compliance with the requirements of the Exchange Act and other applicable Laws.

 

Article V

ADDITIONAL MATTERS

 

5.1            Cash
Incentive Programs. SpinCo shall assume all Liabilities with respect to all cash incentive compensation, commissions or similar cash
payments earned by or payable to SpinCo Employees for the year in which the Distribution Time occurs and thereafter. The Company shall
retain all Liabilities with respect to any cash incentive compensation, commissions or similar cash payments earned by or payable to Company
Employees for the year in which the Distribution Time occurs and thereafter.

 

     

     

    

 

5.2            Severance.

 

(a)            Effective
as of the Distribution Time, SpinCo shall have adopted a severance plan (the “SpinCo Severance Plan”) for the benefit
of eligible SpinCo Employees containing terms substantially similar to those set forth in the Company Severance Plan. Following the Distribution
Time, the Company shall be responsible for any and all Liabilities and other obligations with respect to the Company Severance Plan, and
SpinCo shall be responsible for any and all Liabilities and other obligations with respect to the SpinCo Severance Plan.

 

(b)            A
SpinCo Employee shall not be deemed to have terminated employment for purposes of determining eligibility for severance benefits in connection
with or in anticipation of the consummation of the transactions contemplated by the Separation Agreement or Merger Agreement. SpinCo shall
be solely responsible for all Liabilities in respect of all costs arising out of payments and benefits relating to the termination or
alleged termination of any SpinCo Employee’s employment that occurs on or after the Distribution Time, including as a result of,
in connection with or following the consummation of the transactions contemplated by the Separation Agreement or Merger Agreement, including
any amounts required to be paid (including any payroll or other taxes), and the costs of providing benefits, under any applicable severance,
separation, redundancy, termination or similar plan, program, practice, contract, agreement, law or regulation (such benefits to include
any medical or other welfare benefits, outplacement benefits, accrued vacation, and taxes).

 

5.3            Time-Off
Benefits. Unless otherwise required under applicable Law (or as would result in duplication of benefits), SpinCo shall (i) credit
each SpinCo Employee with the amount of accrued but unused vacation time, paid time-off and other time-off benefits as such SpinCo Employee
had with the Company Group as of immediately before the date on which the employment of the SpinCo Employee transfers to SpinCo and (ii) permit
each such SpinCo Employee to use such accrued but unused vacation time, paid time off and other time-off benefits in the same manner and
upon the same terms and conditions as the SpinCo Employee would have been so permitted under the terms and conditions of the applicable
Company policies in effect for the year in which such transfer of employment occurs, up to and including full exhaustion of such transferred
unused vacation time, paid-time off and other time-off benefits (if such full exhaustion would be permitted under the applicable Company
policies in effect for that year in which the transfer of employment occurs).

 

5.4            Workers’
Compensation Liabilities. Effective no later than the Distribution Time, SpinCo shall assume all Liabilities for SpinCo Employees,
SpinCo Independent Contractors and Former SpinCo Service Providers related to any and all workers’ compensation injuries, incidents,
conditions, claims or coverage, whenever incurred (including claims incurred prior to the Distribution Time but not reported until after
the Distribution Time), and SpinCo shall be fully responsible for the administration, management and payment of all such claims and satisfaction
of all such Liabilities. Notwithstanding the foregoing, if SpinCo is unable to assume any such Liability or the administration, management
or payment of any such claim solely because of the operation of applicable Law, the Company shall retain such Liabilities and SpinCo shall
reimburse and otherwise fully indemnify the Company for all such Liabilities, including the costs of administering the plans, programs
or arrangements under which any such Liabilities have accrued or otherwise arisen.

 

     

     

    

 

5.5            COBRA
Compliance. The Company shall retain responsibility for compliance with the health care continuation requirements of COBRA with respect
to SpinCo Employees or Former SpinCo Service Providers who, as of the Plan Transition Date, were covered under a Company Benefit Plan
or who had incurred a COBRA qualifying event and were eligible to elect COBRA under a Company Benefit Plan. SpinCo shall be responsible
for administering compliance with the health care continuation requirements of COBRA, and the corresponding provisions of the SpinCo Benefit
Plans with respect to SpinCo Employees and their covered dependents who incur a COBRA qualifying event or loss of coverage at any time
after the Plan Transition Date.

 

5.6            Code
Section 409A. Notwithstanding anything in this Agreement to the contrary, the Parties shall negotiate in good faith regarding
the need for any treatment different from that otherwise provided herein with respect to the payment of compensation to ensure that the
treatment of such compensation does not cause the imposition of a Tax under Section 409A of the Code. In no event, however, shall
any Party be liable to another in respect of any Taxes imposed under, or any other costs or Liabilities relating to, Section 409A
of the Code.

 

5.7            Payroll
Taxes and Reporting. The Parties shall, to the extent practicable, (i) treat SpinCo or a member of the SpinCo Group as a “successor
employer” and the Company (or the appropriate member of the Company Group) as a “predecessor,” within the meaning of
Sections 3121(a)(1) and 3306(b)(1) of the Code, with respect to SpinCo Employees for purposes of Taxes imposed under the United
States Federal Unemployment Tax Act or the United States Federal Insurance Contributions Act, and (ii) cooperate with each other
to avoid, to the extent reasonably practicable, the filing of more than one IRS Form W-2 with respect to each SpinCo Employee for
the calendar year in which the Distribution Time occurs.

 

5.8            Regulatory
Filings. Subject to applicable Law and the Tax Matters Agreement, the Company shall retain responsibility for all employee-related
regulatory filings for reporting periods ending at or prior to the Distribution Time, except for Equal Employment Opportunity Commission
EEO-1 reports and affirmative action program (AAP) reports and responses to Office of Federal Contract Compliance Programs (OFCCP) submissions,
for which the Company shall provide data and information (to the extent permitted by applicable Laws) to SpinCo, which shall be responsible
for making such filings in respect of SpinCo Employees.

 

5.9            Certain
Requirements. Notwithstanding anything in this Agreement to the contrary, if applicable Law requires that any assets or Liabilities
be retained by the Company Group or transferred to or assumed by the SpinCo Group in a manner that is different from that set forth in
this Agreement, such retention, transfer or assumption shall be made in accordance with the terms of such applicable Law and shall not
be made as otherwise set forth in this Agreement and the Parties shall reasonably cooperate to adjust for any related economic consequences.

 

Article VI

OBLIGATIONS OF PARENT AND MERGER SUB

 

6.1            Obligations
of Parent. Following the Merger Effective Time, Parent agrees to cause, and to take all actions to enable, SpinCo and the members
of the SpinCo Group to adhere to each provision of this Agreement which requires an act on the part of SpinCo or any member of the SpinCo
Group or any of its or their Affiliates, and to cause or enable SpinCo and the SpinCo Group to comply with their obligations to provide
or establish compensation or benefits to SpinCo Service Providers in accordance with this Agreement pursuant to a Benefit Plan sponsored
or maintained by Parent or any of its Subsidiaries.

 

Article VII

GENERAL AND ADMINISTRATIVE

 

7.1            Employer
Rights. Nothing in this Agreement shall be deemed to be an amendment to any Company Benefit Plan or SpinCo Benefit Plan or to prohibit
any member of the Company Group or SpinCo Group, as the case may be, from amending, modifying or terminating any Company Benefit Plan
or SpinCo Benefit Plan at any time within its sole discretion.

 

     

     

    

 

7.2            Effect
on Employment. Nothing in this Agreement is intended to or shall confer upon any employee or former employee of the Company, SpinCo
or any of their respective Affiliates any right to continued employment, or any recall or similar rights to any such individual on layoff
or any type of approved leave.

 

7.3            Consent
of Third Parties. If any provision of this Agreement is dependent on the consent of any third party and such consent is withheld,
the Parties shall use their reasonable efforts to implement the applicable provisions of this Agreement to the fullest extent practicable.
If any provision of this Agreement cannot be implemented due to the failure of such third party to consent, the Parties hereto shall negotiate
in good faith to implement the provision (as applicable) in a mutually satisfactory manner.

 

7.4            Access
to Employees. On and after the Distribution Time, the Parties shall, or shall cause each of their respective Affiliates to, make available
to each other those of their employees who may reasonably be needed in order to defend or prosecute any legal or administrative action
(other than a legal action among the Parties) to which any employee or director of the Company Group or the SpinCo Group or any Company
Benefit Plan or SpinCo Benefit Plan is a party and which relates to a Company Benefit Plan or SpinCo Benefit Plan. The Party to whom an
employee is made available in accordance with this Section 7.4 shall pay or reimburse the other Parties for all reasonable
expenses which may be incurred by such employee in connection therewith, including all reasonable travel, lodging, and meal expenses,
but excluding any amount for such employee’s time spent in connection herewith.

 

7.5            Beneficiary
Designation/Release of Information/Right to Reimbursement. To the extent permitted by applicable Law and except as otherwise provided
for in this Agreement, all beneficiary designations, authorizations for the release of information and rights to reimbursement made by
or relating to SpinCo Employees under Company Benefit Plan shall be transferred to and be in full force and effect under the corresponding
SpinCo Benefit Plan until such beneficiary designations, authorizations or rights are replaced or revoked by, or no longer apply, to the
relevant SpinCo Employee.

 

7.6            No
Third Party Beneficiaries. This Agreement is solely for the benefit of the Parties and, except to the extent otherwise expressly provided
herein, nothing in this Agreement, express or implied, is intended to confer any rights, benefits, remedies, obligations or Liabilities
under this Agreement upon any Person, including any SpinCo Employee or other current or former employee, officer, director or contractor
of the Company Group or SpinCo Group, other than the Parties and their respective successors and assigns.

 

7.7            Employee
Benefits Administration. At all times following the date hereof, the Parties will cooperate in good faith as necessary to facilitate
the administration of employee benefits and the resolution of related employee benefit claims with respect to SpinCo Employees, Former
SpinCo Service Providers and employees and other service providers of the Company, as applicable, including with respect to the provision
of employee level information necessary for the other Parties to manage, administer, finance and file required reports with respect to
such administration.

 

7.8            Audit
Rights With Respect to Information Provided.

 

(a)            Each
Party, and their duly authorized representatives, shall have the right to conduct reasonable audits with respect to all information required
to be provided to it by the other Parties under this Agreement. The Party conducting the audit (the “Auditing Party”)
may adopt reasonable procedures and guidelines for conducting audits and the selection of audit representatives under this Section 7.8.
The Auditing Party shall have the right to make copies of any records at its expense, subject to any restrictions imposed by applicable
laws and to any confidentiality provisions set forth in the Separation Agreement, which are incorporated by reference herein. The Party
being audited shall provide the Auditing Party’s representatives with reasonable access during normal business hours to its operations,
computer systems and paper and electronic files, and provide workspace to its representatives. After any audit is completed, the Party
being audited shall have the right to review a draft of the audit findings and to comment on those findings in writing within thirty business
days after receiving such draft.

 

     

     

    

 

(b)            The
Auditing Party’s audit rights under this Section 7.8 shall include the right to audit, or participate in an audit facilitated
by the Party being audited, of any Subsidiaries and Affiliates of the Party being audited and to require the other Parties to request
any benefit providers and third parties with whom the Party being audited has a relationship, or agents of such Party, to agree to such
an audit to the extent any such Persons are affected by or addressed in this Agreement (collectively, the “Non-parties”).
The Party being audited shall, upon written request from the Auditing Party, provide an individual (at the Auditing Party’s expense)
to supervise any audit of a Non-party. The Auditing Party shall be responsible for supplying, at the Auditing Party’s expense, additional
personnel sufficient to complete the audit in a reasonably timely manner. The responsibility of the Party being audited shall be limited
to providing, at the Auditing Party’s expense, a single individual at each audited site for purposes of facilitating the audit.

 

7.9            Cooperation.
Each of the Parties hereto will use its commercially reasonable efforts to share information and promptly take, or cause to be taken,
all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws to consummate the transactions
contemplated by this Agreement.

 

Article VIII

MISCELLANEOUS

 

8.1            Entire
Agreement. This Agreement, the Separation Agreement, the Merger Agreement, and the other Transaction Documents, including the Exhibits
and Schedules thereto, shall constitute the entire agreement among the Parties with respect to the subject matter hereof and shall supersede
all previous negotiations, commitments, course of dealings and writings with respect to such subject matter.

 

8.2            Counterparts.
This Agreement may be executed in two or more counterparts (including by electronic or .pdf transmission), each of which shall be deemed
an original, but all of which together shall constitute one and the same instrument. Delivery of any signature page by facsimile,
electronic or .pdf transmission shall be binding to the same extent as an original signature page.

 

8.3            Survival
of Agreements. Except as otherwise contemplated by this Agreement, all covenants and agreements of the Parties contained in this Agreement
shall survive the Distribution Time and Merger Effective Time and remain in full force and effect in accordance with their applicable
terms.

 

8.4            Notices.
All notices and other communications among the Parties shall be in writing and shall be deemed to have been duly given (a) when delivered
in person, (b) when delivered after posting in the national mail having been sent registered or certified mail return receipt requested,
postage prepaid, (c) when delivered by FedEx or other internationally recognized overnight delivery service or (d) when delivered
by facsimile (solely if receipt is confirmed) or email (so long as the sender of such email does not receive an automatic reply from the
recipient’s email server indicating that the recipient did not receive such email), addressed as follows:

 

     

     

    

 

To the Company:

 

Ligand Pharmaceuticals Incorporated

3911 Sorrento Valley Boulevard, Suite 110

San Diego, California 92121

Attn: Chief Financial Officer

Email: tespinoza@ligand.com

 

with a copy (which shall not constitute notice) to:

 

Latham & Watkins, LLP

12670 High Bluff Dr.

San Diego, California 92130

	Attention:	Matthew Bush
	 	Scott Shean
	Email:	matt.bush@lw.com
	 	scott.shean@lw.com

 

To SpinCo:

 

OmniAb, Inc.

5980 Horton Street, Suite 405

Emeryville, California 94608

Attn: Chief Legal Officer

Email: cberkman@omniab.com

 

with a copy (which shall not constitute notice) to:

 

Latham & Watkins, LLP

12670 High Bluff Dr.

San Diego, California 92130

	Attention:	Matthew Bush
	 	Scott Shean
	Email:	matt.bush@lw.com
	 	scott.shean@lw.com

 

To Parent or Merger Sub:

 

Avista Public Acquisition Corp. II

65 East 55th Street, 18th
Floor

New York, New York 10022

Attn: General Counsel

Email: Silbert@avistacap.com

 

with a copy (which shall not constitute notice)
to:

 

Weil, Gotshal & Manges LLP

767 5th Avenue

New York, New York 10153

	Attention:	Jaclyn L. Cohen, Esq.
	 	Raymond O. Gietz, Esq.
	Email:	jackie.cohen@weil.com
	 	Raymond.gietz@weil.com

 

or to such other address or addresses as the Parties
may from time to time designate in writing by like notice.

 

     

     

    

 

8.5            Consents.
Any consent required or permitted to be given by any Party to the other Parties under this Agreement shall be in writing and signed by
the Party giving such consent and shall be effective only against such Party (and its Group).

 

8.6            Assignment.
This Agreement shall not be assignable, in whole or in part, directly or indirectly, by any Party hereto without the prior written consent
of the other Parties, and any attempt to assign any rights or obligations arising under this Agreement without such consent shall be void.
Notwithstanding the foregoing, and subject to any restrictions on assignment by SpinCo pursuant to Article IV of the Tax Matters
Agreement, this Agreement shall be assignable to (i) with respect to the Company, an Affiliate of the Company, and with respect to
SpinCo, and Affiliate of SpinCo, or (ii) a bona fide third party in connection with a merger, reorganization, consolidation or the
sale of all or substantially all the assets of a party hereto so long as the resulting, surviving or transferee entity assumes all the
obligations of the relevant party hereto by operation of Law or pursuant to an agreement in form and substance reasonably satisfactory
to the other Parties to this Agreement; provided however that in the case of each of the preceding clauses (i) and
(ii), no assignment permitted by this Section 8.6 shall release the assigning Party from liability for the full performance
of its obligations under this Agreement.

 

8.7            Successors
and Assigns. The provisions of this Agreement and the obligations and rights hereunder shall be binding upon, inure to the benefit
of and be enforceable by (and against) the Parties and their respective successors and permitted assigns.

 

8.8            Termination
and Amendment. This Agreement may be amended or modified, in whole or in part, only by a duly authorized agreement in writing executed
by the Parties in the same manner (but not necessarily by the same Persons) as this Agreement, and which makes reference to this Agreement.
This Agreement shall terminate automatically without any further action of the Parties upon a termination of the Merger Agreement, and
no Party will have any further obligations to the other Parties hereunder.

 

8.9            Subsidiaries.
Each of the Parties shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set
forth herein to be performed by any Subsidiary of such Party or by any entity that becomes a Subsidiary of such Party at and after the
Distribution Time, to the extent such Subsidiary remains a Subsidiary of the applicable Party.

 

8.10            Title
and Headings. Titles and headings to sections herein are inserted for the convenience of reference only and are not intended to be
a part of or to affect the meaning or interpretation of this Agreement.

 

     

     

    

 

8.11            Governing
Law. This Agreement, and all claims, disputes, controversies or causes of action (whether in contract, tort, equity or otherwise)
that may be based upon, arise out of or relate to this Agreement (including any schedule or exhibit hereto) or the negotiation, execution
or performance of this Agreement (including any claim, dispute, controversy or cause of action based upon, arising out of or related to
any representation or warranty made in or in connection with this Agreement or as an inducement to enter into this Agreement), shall be
governed by and construed in accordance with the Laws of the State of Delaware, without regard to any choice or conflict of law provision
or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the Laws of any jurisdiction
other than the State of Delaware. Each of the Parties agrees that any Action related to this agreement shall be brought exclusively in
the Chosen Courts. By executing and delivering this Agreement, each of the Parties irrevocably: (a) accepts generally and
unconditionally submits to the exclusive jurisdiction of the Chosen Courts for any Action relating to this Agreement; (b) waives
any objections which such party may now or hereafter have to the laying of venue of any such Action contemplated by this Section 8.11
and hereby further irrevocably waives and agrees not to plead or claim that any such Action has been brought in an inconvenient forum;
(c) agrees that it will not attempt to deny or defeat the personal jurisdiction of the Chosen Courts by motion or other request for
leave from any such court; (d) agrees that it will not bring any Action contemplated by this Section 8.11 in any court other
than the Chosen Courts; (e) agrees that service of all process, including the summons and complaint, in any Action may be made by
registered or certified mail, return receipt requested, to such party at their respective addresses provided in accordance with Section 8.4
or in any other manner permitted by Law; and (f) agrees that service as provided in the preceding clause (e) is sufficient to
confer personal jurisdiction over such party in the Action, and otherwise constitutes effective and binding service in every respect.
Each of the parties hereto agrees that a final judgment in any Action in a Chosen Court as provided above may be enforced in other jurisdictions
by suit on the judgment or in any other manner provided by Law, and each party further agrees to the non-exclusive jurisdiction of the
Chosen Courts for the enforcement or execution of any such judgment.

 

8.12            WAIVER
OF JURY TRIAL. THE PARTIES HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVE THEIR RIGHT TO TRIAL BY JURY IN ANY JUDICIAL PROCEEDING IN ANY
COURT RELATING TO ANY DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF, RELATING TO OR IN CONNECTION WITH THIS AGREEMENT (INCLUDING ANY SCHEDULE
OR EXHIBIT HERETO) OR THE BREACH, TERMINATION OR VALIDITY OF THIS AGREEMENT OR THE NEGOTIATION, EXECUTION OR PERFORMANCE OF THIS
AGREEMENT. NO PARTY TO THIS AGREEMENT SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE
BASED UPON, OR ARISING OUT OF, THIS AGREEMENT OR ANY RELATED INSTRUMENTS. NO PARTY WILL SEEK TO CONSOLIDATE ANY SUCH ACTION IN WHICH A
JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. EACH PARTY TO THIS AGREEMENT
CERTIFIES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT OR INSTRUMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
SET FORTH ABOVE IN THIS SECTION 8.12. NO PARTY HAS IN ANY WAY AGREED WITH OR REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF
THIS SECTION 8.12 WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.

 

8.13            Severability.
If any provision of this Agreement, or the application of any such provision to any Person or circumstance, shall be held invalid, illegal
or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision hereof. The Parties further agree that if any provision contained herein is, to any extent, held invalid or unenforceable
in any respect under the Laws governing this Agreement, they shall take any actions necessary to render the remaining provisions of this
Agreement valid and enforceable to the fullest extent permitted by Law and, to the extent necessary, shall amend or otherwise modify this
Agreement to replace any provision contained herein that is held invalid or unenforceable with a valid and enforceable provision giving
effect to the intent of the Parties.

 

8.14            Interpretation.
The Parties have participated jointly in the negotiation and drafting of this Agreement. This Agreement shall be construed without regard
to any presumption or rule requiring construction or interpretation against the Party drafting or causing any instrument to be drafted.

 

     

     

    

 

8.15            No
Duplication; No Double Recovery. Nothing in this Agreement is intended to confer to or impose upon any Party a duplicative right,
entitlement, obligation or recovery with respect to any matter arising out of the same facts and circumstances.

 

8.16            No
Waiver. No failure to exercise and no delay in exercising, on the part of any Party, any right, remedy, power or privilege hereunder
shall operate as a waiver hereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

 

8.17            No
Admission of Liability. The allocation of Assets and Liabilities herein is solely for the purpose of allocating such Assets and Liabilities
among the Parties and is not intended as an admission of liability or responsibility for any alleged Liabilities vis-à-vis any
third party, including with respect to the Liabilities of any non-wholly owned subsidiary of any Party.

 

[Signature Page Follows]

 

     

     

    

 

IN WITNESS WHEREOF, the Parties have caused this
Agreement to be duly executed as of the day and year first above written.

 

	LIGAND PHARMACEUTICALS INCORPORATED	 
	 	 	 
	By:	/s/ Matthew Korenberg	 
	Name:	Matthew Korenberg	 
	Title:	Executive Vice President, Finance and Chief Financial Officer	 
	 	 	 
	OMNIAB, INC.	 
	 	 	 
	By:	/s/ Matthew W. Foehr 	 
	Name:	Matthew W. Foehr	 
	Title:	President and Chief Executive Officer	 
	 	 	 
	AVISTA PUBLIC ACQUISITION CORP. II	 
	 	 	 
	By:	 /s/ Benjamin Silbert	 
	Name:	Benjamin Silbert	 
	Title:	General Counsel	 
	 	 	 
	ORWELL MERGER SUB INC.	 
	 	 	 
	By:	 /s/ David Burgstahler	 
	Name:	David Burgstahler	 
	Title:	President	 

 

[Signature Page to Employee Matters Agreement]

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