Document:

EX-10.2

   

  Exhibit 10.2

   

  ═══════════════════════════════════════════════════════

  SECURITY AGREEMENT

  dated as of 

  September 2, 2022

  among

  ALIGNMENT HEALTHCARE USA, LLC,

  the other Grantors from time to time party hereto

  and

  OXFORD FINANCE LLC,

  as Administrative Agent and Collateral Agent

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  Table of Contents

  (continued)

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  Table of Contents

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	Section 1.	Definitions, Etc.
	2

	1.01	Certain Uniform Commercial Code Terms
	2

	1.02	Additional Definitions
	2

	1.03	Other Defined Terms
	4

	Section 2.	Representations and Warranties
	4

	2.01	Organizational Matters; Enforceability, Etc.
	4

	2.02	Title........
	4

	2.03	Names, Etc.
	5

	2.04	Changes in Circumstances
	5

	2.05	Pledged Shares
	5

	2.06	Promissory Notes
	5

	2.07	Intellectual Property
	5

	2.08	Deposit Accounts, Securities Accounts and Commodity Accounts
	6

	2.09	Commercial Tort Claims
	6

	2.10	Update of Schedules
	6

	Section 3.	Collateral
	6

	3.01	Granting Clause
	6

	3.02	Excluded Assets
	8

	Section 4.	Further Assurances; Remedies
	9

	4.01	Delivery and Other Perfection
	9

	4.02	Other Financing Statements or Control
	11

	4.03	Preservation of Rights
	11

	4.04	Special Provisions Relating to Certain Collateral
	11

	4.05	Remedies
	13

	4.06	Deficiency
	15

	4.07	Locations; Names, Etc.
	15

	4.08	Private Sale
	15

	4.09	Application of Proceeds
	15

	4.10	Attorney in Fact
	16

	4.11	Perfection and Recordation
	16

	4.12	Termination
	16

	4.13	Further Assurances
	17

	Section 5.	Miscellaneous
	17

   

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  Table of Contents

  (continued)

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	5.01	Notices......
	17

	5.02	No Waiver
	17

	5.03	Amendments, Etc.
	17

	5.04	Expenses......
	17

	5.05	Successors and Assigns
	18

	5.06	Counterparts
	18

	5.07	Governing Law; Submission to Jurisdiction; Etc.
	18

	5.08	WAIVER OF JURY TRIAL
	18

	5.09  	Captions.......
	19

	5.10	Agents and Attorneys in Fact
	19

	5.11	Severability
	19

	5.12	Additional Grantors
	19

	5.13	Healthcare Savings Clause
	19

   

   

   

   

   

  -ii-

   

  

   

  SCHEDULES AND EXHIBITS

   

  Exhibit A	-	Form of Joinder

  Schedule 1	 -	Certain Grantor Information

  Schedule 2	-	Pledged Shares

  Schedule 3	-	Promissory Notes

  Schedule 4	-	Copyrights, Copyright Registrations and Applications for Copyright

  Registrations

  Schedule 5	-	Patents and Patent Applications

  Schedule 6	-	Trademarks, Service Marks, Trademark and Service Mark Registrations

  and Applications for Trademark and Service Mark Registrations

  Schedule 7	-	Deposit Accounts, Securities Accounts and Commodity Accounts 

  Schedule 8	-	Commercial Tort Claims

   

   

   

   

   

  

   

  SECURITY AGREEMENT

  SECURITY AGREEMENT dated as of September 2, 2022 (this “Agreement”), among ALIGNMENT HEALTHCARE USA, LLC, a Delaware limited liability company (“Borrower”), ALIGNMENT HEALTHCARE HOLDCO 2, LLC, a Delaware limited liability company (“Holdings”), ALIGNMENT HEALTHCARE HOLDCO 1, LLC, a Delaware limited liability company (“Healthcare Holdco”), ALIGNMENT HEALTHCARE, INC., a Delaware corporation (“Parent”), the undersigned subsidiaries (collectively with Borrower, Holdings, Healthcare Holdco, Parent, and each entity that becomes a “Grantor” hereunder as contemplated by Section 5.12, the “Grantors” and each, a “Grantor”), and OXFORD FINANCE LLC, a Delaware limited liability company, as administrative agent and collateral agent for the Lenders (in such capacities, together with its successors and assigns, “Administrative Agent”).

  The Lenders have agreed to provide term loans to Borrower as provided in the Loan Agreement (as defined below).

  Each Grantor (other than Borrower) has guaranteed the obligations of Borrower to the Secured Parties under the Loan Agreement.

  To induce the Lenders to extend credit under the Loan Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Grantor has agreed to grant a security interest in the Collateral (as defined below) of such Grantor as security for the Secured Obligations (as defined below).

  Accordingly, the parties hereto agree as follows:

  Section 1.	Definitions, Etc.

  	1.01	Certain Uniform Commercial Code Terms. As used herein, the terms “Accession,” “Account,” “Chattel Paper,” “Check,” “Commodity Account,” “Commodity Contract,” “Deposit Account,” “Document,” “Electronic Chattel Paper,” “Encumbrance,” “Equipment,” “Fixture,” “General Intangible,” “Goods,” “Instrument,” “Inventory,” “Investment Property,” “Letter-of-Credit Right,” “Payment Intangibles,” “Proceeds,” “Promissory Note,” “Record,” “Software” and “Supporting Obligation” have the respective meanings set forth in Article 9 of the NYUCC, and the terms “Financial Asset,” “Securities Account,” “Security” and “Security Entitlement” have the respective meanings set forth in Article 8 of the NYUCC.

  	1.02	Additional Definitions. In addition, as used herein:

  “Collateral” has the meaning assigned to such term in Section 3.01.

  “Copyrights” means all copyrights, copyright registrations and applications for copyright registrations, including all renewals and extensions thereof, all rights to recover for past, present or future infringements thereof and all other rights whatsoever accruing thereunder or pertaining thereto.

  “Excluded Asset” means, to the extent any property is excluded from the Collateral solely by operation of Section 3.02, such property.

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  “Federal A/R Account” means any Deposit Account into which payments on Medicare or Medicaid accounts receivable, or other accounts receivable under which the Federal government is the account debtor, directly are paid (regardless of whether such Deposit Account is identified as such on Schedule 7).

  “Initial Pledged Shares” means the Shares of each Issuer beneficially owned by any Grantor on the date hereof and identified in Schedule 2.

  “Issuers” means, collectively, (a) the respective Persons identified on Schedule 2 under the caption “Issuer” and (b) the issuer of any Equity Interests (other than any Equity Interests constituting an Excluded Asset) hereafter owned by any Grantor.

  “Joinder” has the meaning specified in Section 5.12.

  “Loan Agreement” means that certain term loan agreement, dated as of the date hereof, among Parent, Healthcare Holdco, Holdings, Borrower, the subsidiary guarantors from time to time party thereto, the Lenders from time to time party thereto and Administrative Agent, as such agreement is amended, supplemented, or otherwise modified, restated, extended, renewed, or replaced from time to time.

  “Motor Vehicles” means motor vehicles, tractors, trailers and other like property, if the title thereto is governed by a certificate of title or ownership.

  “NYUCC” means the Uniform Commercial Code as in effect from time to time in the State of New York.

  “Patents” means all patents and patent applications, including the inventions and improvements described and claimed therein together with the reissues, divisions, continuations, renewals, extensions and continuations in part thereof, all income, royalties, damages and payments now or hereafter due and/or payable with respect thereto, all damages and payments for past or future infringements thereof and rights to sue therefor, and all rights corresponding thereto throughout the world.

  “Pledged Shares” means, collectively, (a) the Initial Pledged Shares and (b) all other Shares of any Issuer (other than any Shares constituting an Excluded Asset) now or hereafter owned by any Grantor, together in each case with (i) all certificates representing the same, (ii) all shares, securities, moneys or other property representing a dividend on or a distribution or return of capital on or in respect of the Pledged Shares, or resulting from a split-up, revision, reclassification or other like change of the Pledged Shares or otherwise received in exchange therefor, and any warrants, rights or options issued to the holders of, or otherwise in respect of, the Pledged Shares, and (iii) without prejudice to any provision of any of the Loan Documents prohibiting any merger or consolidation by an Issuer, all Shares of any successor entity of any such merger or consolidation.

  “Secured Obligations” means, with respect to each Grantor, the Obligations of such Grantor.

  “Shares” means shares of capital stock of a corporation, limited liability company interests, partnership interests and other ownership or equity interests of any class in any Person.

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  “Trademarks” means all trade names, trademarks and service marks, logos, trademark and service mark registrations, and applications for trademark and service mark registrations, including all renewals of trademark and service mark registrations, all rights to recover for all past, present and future infringements thereof and all rights to sue therefor, and all rights corresponding thereto throughout the world.

  	1.03	Other Defined Terms. All other capitalized terms used and not defined herein have the meanings ascribed to them in the Loan Agreement.

  Section 2.	Representations and Warranties. Each Grantor represents and warrants to the Secured Parties that:

  	2.01	Organizational Matters; Enforceability, Etc. (a) Each Grantor is duly organized, validly existing and, except where the failure to be in good standing could not reasonably be expected to result in a Material Adverse Effect, in good standing under the laws of the jurisdiction of its organization. The execution, delivery and performance of this Agreement, and the grant of the security interests pursuant hereto, (i) are within such Grantor’s powers and have been duly authorized by all necessary corporate or other action, (ii) except as disclosed on Schedule 7.03(a) of the Loan Agreement, do not require any consent or approval of, registration or filing with, or any other action by, any governmental authority or court, except for (A) such as have been obtained or made and are in full force and effect and (B) filings and recordings in respect of the security interests created pursuant hereto, (iii) will not violate any applicable law or regulation in any material respect or the charter, bylaws or other organizational documents of such Grantor or any order of any governmental authority or court binding upon such Grantor or its property, (iv) will not violate or result in a default under any indenture, agreement or other instrument binding upon such Grantor or any of its assets, or give rise to a right thereunder to require any payment to be made by any such person, and (v) except for the security interests created pursuant hereto, will not result in the creation or imposition of any Lien on any asset of such Grantor.

  	(b)	This Agreement has been duly executed and delivered by such Grantor and constitutes, a legal, valid and binding obligation of such Grantor, enforceable against such Grantor in accordance with its terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or similar laws of general applicability affecting the enforcement of creditors’ rights and (ii) the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

  	2.02	Title. (a) Such Grantor is the sole beneficial owner of the Collateral in which it purports to grant a lien hereunder, and no lien exists upon such Collateral other than Permitted Liens.

  	(b)	The security interest created or provided for herein constitutes a valid first-priority (subject to Permitted Liens) perfected lien on such Collateral, subject, for the following Collateral, to the occurrence of the following: (i) in the case of Collateral in which a security interest may be perfected by filing a financing statement under the UCC, the filing of a UCC financing statement naming such Grantor as debtor, the Administrative Agent as secured party, and listing all personal property as collateral, (ii) with respect to any Deposit Account, Securities Account or Commodity Account, the execution of agreements among such Grantor, the applicable financial institution and Administrative Agent, effective to grant “control” (as defined in the UCC) over such Deposit Account, Securities Account or Commodity Account to 

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  Administrative Agent, (iii) with respect to any Intellectual Property not described in the foregoing clause (i), the filing of this Security Agreement or a Short-Form IP Security Agreement with the applicable Intellectual Property office of the applicable government, and (iv) in the case of all certificated Shares, the delivery thereof to Administrative Agent, properly endorsed for transfer to Administrative Agent or in blank.

  	2.03	Names, Etc. The full and correct legal name, type of organization, jurisdiction of organization, organizational ID number (if applicable) and mailing address of such Grantor as of the date hereof are correctly set forth in Schedule 1. Schedule 1 correctly specifies (i) the place of business of such Grantor or, if such Grantor has more than one place of business, the location of the chief executive office of such Grantor and (ii) each location where Collateral in excess of $250,000 is stored or located.

  	2.04	Changes in Circumstances. Except to the extent that such Grantor has, prior to any such change, notified Administrative Agent in writing of such change, such Grantor has not (a) within the period of four months prior to the date hereof, changed its location (as defined in Section 9-307 of the NYUCC), or (b) changed its name from that set forth in Schedule 1.

  	2.05	Pledged Shares. (a) The Initial Pledged Shares constitute (i) 100% of the issued and outstanding Shares of each Issuer (other than a First-Tier Foreign Subsidiary that is not a Grantor) beneficially owned by such Grantor on the date hereof (other than any Shares held in a Securities Account referred to in Schedule 7), whether or not registered in the name of such Grantor and (ii) in the case of each Issuer that is a First-Tier Foreign Subsidiary that is not a Grantor, (x) 65% (or such greater percentage as may be provided pursuant to Section 3.02(a)) of the issued and outstanding shares of voting stock of such Issuer and (y) 100% of all other issued and outstanding shares of capital stock of whatever class of such Issuer beneficially owned by such Grantor on the date hereof, in each case whether or not registered in the name of such Grantor. Schedule 2 correctly identifies, as at the date hereof, the respective Issuers of the Initial Pledged Shares and (in the case of any corporate Issuer) the respective class and par value of such Shares and the respective number of such Shares (and registered owner thereof) represented by each such certificate.

  	(b)	The Initial Pledged Shares are, and all other Pledged Shares that in the future will constitute Collateral will be, (i) duly authorized, validly existing, fully paid and non- assessable (in the case of any Shares issued by a corporation) and (ii) duly issued and outstanding (in the case of any equity interest in any other entity). None of such Pledged Shares are or will be subject to any contractual restriction, or any restriction under the charter, bylaws, partnership agreement or other organizational instrument of the respective Issuer thereof, upon the transfer of such Pledged Shares (except for any such restriction contained in or expressly permitted under any Loan Document, including any Restrictive Agreement permitted under Section 9.11 of the Loan Agreement).

  	2.06	Promissory Notes. Schedule 3 sets forth a complete and correct list of all Promissory Notes (other than any held in a Securities Account referred to in Schedule 7) held by such Grantor on the date hereof.

  	2.07	Intellectual Property. (a) Schedules 4, 5 and 6, respectively, set forth a complete and correct list of all of the following owned by such Grantor on the date hereof (or, in the case of any supplement to said Schedules 4, 5 and 6, effecting a pledge thereof, as of the date of such supplement): (i) applied for or 

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  registered Copyrights, (ii) applied for or registered Patents, including the jurisdiction and patent number and (iii) applied for or registered Trademarks, including the jurisdiction, trademark application or registration number and the application or registration date.

  	(b)	Except as could not reasonably be expected to have a Material Adverse Effect, all registrations listed in said Schedules 4, 5 and 6 (as so supplemented) are, except as noted therein, in full force and effect.

  	(c)	Except as could not reasonably be expected to have a Material Adverse Effect, such Grantor owns and possesses the right to use all Copyrights, Patents and Trademarks listed on Schedules 4, 5 and 6, respectively. Except as could not reasonably be expected to have a Material Adverse Effect, (i) except as set forth on Schedule 4, 5 or 6 (as supplemented by any supplement effecting a pledge thereof), there is no violation by others of any right of such Grantor with respect to any Copyright, Patent or Trademark listed on Schedule 4, 5 or 6 (as so supplemented), respectively, and (ii) such Grantor is not infringing in any respect upon any Copyright, Patent or Trademark of any other Person. Except as could not reasonably be expected to have a Material Adverse Effect, no proceedings alleging such infringement have been instituted or are pending against such Grantor and no written claim against such Grantor has been received by such Grantor, alleging any such violation, except as may be set forth on Schedule 4, 5 or 6 (as so supplemented).

  	2.08	Deposit Accounts, Securities Accounts and Commodity Accounts. Schedule 7 sets forth a complete and correct list of all Deposit Accounts, Securities Accounts and Commodity Accounts of such Grantor on the date hereof.

  	2.09	Commercial Tort Claims. Schedule 8 sets forth a complete and correct list of all commercial tort claims of such Grantor in existence on the date hereof.

  	2.10	Update of Schedules. Each of Schedules 1 through 8 may be updated by Borrower from time to time to ensure the continued accuracy of the representations set forth in this Section 2 to be made on any upcoming date on which representations and warranties are made incorporating the information in such Schedule, by Borrower providing notice (attaching an amended and restated version of such Schedule) in accordance with Section 13.02 of the Loan Agreement.

  Section 3.	Collateral. 

  	3.01	Granting Clause. As collateral security for the payment in full when due (whether at stated maturity, by acceleration or otherwise) of the Secured Obligations, each Grantor hereby pledges and grants to Administrative Agent, for the benefit of the Secured Parties, a security interest in all of such Grantor’s right, title and interest in, to and under all of its personal property constituting Collateral (as defined below). The term “Collateral”, as to any Grantor, collectively means the following personal property, in each case whether tangible or intangible, wherever located, and whether now owned by such Grantor or hereafter acquired and whether now existing or hereafter coming into existence, but excluding all Excluded Assets:

  	(a)	all Accounts, accounts receivable, notes receivable, contract rights, chattel paper (including electronic chattel paper), documents (including Documents of Title), instruments and letters of credit; 

  	(b)	all Chattel Paper and other Records;

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  	(c)	all Checks;

  	(d)	all commercial tort claims, as defined in Section 9-102(a)(13) of the NYUCC, arising out of the events described in Schedule 8;

  	(e)	all Deposit Accounts;

  	(f)	all Documents;

  	(g)	all Equipment (including all Software, whether or not the same constitutes embedded Software, used in the operation thereof);

  	(h)	all Fixtures;

  	(i)	all General Intangibles (including Payment Intangibles and Software, patents, trademarks, tradestyles, copyrights, and all other intellectual property rights, including all applications, registration, and licenses therefor, and all goodwill of the business connected therewith or represented thereby);

  	(j)	all Goods not otherwise described in this Section 3;

  	(k)	all Instruments, including all Promissory Notes;

  	(l)	all Intellectual Property;

  	(m)	all Inventory;

  	(n)	all Letter-of-Credit Rights and all Supporting Obligations;

  	(o)	all Investment Property not otherwise described in this Section 3, including all Securities, all Securities Accounts and all Security Entitlements with respect thereto and Financial Assets carried therein, and all Commodity Accounts and Commodity Contracts;

  	(p)	all Pledged Shares;

  	(q)	all other Property of such Grantor; and

  	(r)	the collections and Proceeds, whether cash or non-cash, of all of the foregoing (including, without limitation, any adequate protection payments), all Accessions to and substitutions and replacements for, any of the Collateral, and all offspring, rents, profits and products of any of the Collateral, and, to the extent related to any Collateral, all books, correspondence, credit files, records, invoices and other papers (including all tapes, cards, computer runs and other papers and documents in the possession or under the control of such Grantor or any computer bureau or service company from time to time acting for such Grantor);

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  provided, however, that nothing set forth in this Section 3.01 or any other provision of this Agreement or any other Loan Document shall at any time constitute the grant of a security interest in, or a Lien on, any Excluded Asset, none of which shall constitute Collateral.

  	3.02	Excluded Assets. Notwithstanding anything herein to the contrary, in no event shall the Collateral include, and each Grantor shall not be deemed to have granted a security interest in, any of such Grantor’s right, title or interest in:

  	(a)	any of the outstanding voting capital stock or other ownership interests of a First-Tier Foreign Subsidiary that is not a Grantor in excess of 65% of the voting power of all classes of capital stock or other ownership interests of such First-Tier Foreign Subsidiary entitled to vote; provided that (i) immediately upon the amendment of the Code to allow the pledge of a greater percentage of the voting power of capital stock or other ownership interests in a First- Tier Foreign Subsidiary without adverse tax consequences, the Collateral shall include, and each Grantor shall be deemed to have granted a security interest in, such greater percentage of capital stock or other ownership interests of each First-Tier Foreign Subsidiary in which it has any interest and (ii) if no material adverse tax consequences to Parent and its Subsidiaries, taken as a whole, shall arise or exist in connection with the pledge of any First-Tier Foreign Subsidiary, the Collateral shall include, and the applicable Grantor shall be deemed to have granted a security interest in, all of the capital stock or other ownership interests of such First-Tier Foreign Subsidiary held by such Grantor;

  	(b)	any lease, license, contract or agreement to which any Grantor is a party, in each case, if and only if, and solely to the extent that, the grant of a security interest therein shall constitute or result in a breach, termination or default or invalidity thereunder or thereof (other than to the extent that any such term would be rendered ineffective pursuant to Sections 9- 406, 9-407, 9-408 or 9-409 of the UCC of any relevant jurisdiction or any other applicable law or principles of equity); provided that immediately upon the time at which the consequences described in the foregoing provision shall no longer exist, the Collateral shall include, and the applicable Grantor shall be deemed to have granted a security interest in, all of such Grantor’s right, title and interest in such lease, license, contract or agreement;

  	(c)	any license, franchise, charter or authorization from a Governmental Authority, in each case, if and only if, and solely to the extent that, the grant of a security interest therein shall constitute or result in a breach, termination or default or invalidity thereunder or thereof (other than to the extent that any such term would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC of any relevant jurisdiction or any other applicable law or principles of equity);

  	(d)	all Equity Interests, property and assets of any Healthcare Subsidiary or Managed Company;

  	(e)	all Equity Interests of any Person not constituting a Subsidiary to the extent that the grant of a security interest therein (i) is prohibited by any joint venture or shareholders agreement (other than to the extent that any such prohibition would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC of any relevant jurisdiction or any other applicable law or principles of equity) or (ii) requires consent or authorization from a Governmental Authority (except to the extent such consent or authorization has been obtained or would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC of any relevant jurisdiction or any other applicable law or principles of equity);

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  	(f)	any Equipment or other property that would otherwise be included in the Collateral if such equipment or other property is subject to a Lien described in Section 9.02(c), (d), (k) and (l) of the Loan Agreement, in each case to the extent that the grant of a security interest therein is prohibited by the applicable documentation relating to such Lien; 

  	(g)	 (A) Deposit Accounts the balance of which consists exclusively of and used exclusively for (i) withheld income taxes and federal, state or local employment taxes in such amounts as are required to be paid to the IRS or state or local government agencies within the following two months with respect to employees of any of Parent, its Subsidiaries or any Managed Company or (ii) amounts required to be paid over to an employee benefit plan pursuant to DOL Reg. Sec. 2510.3-102 on behalf of or for the benefit of employees of any of Parent, its Subsidiaries or any Managed Company, (B) bank accounts constituting (and the balance of which consists solely of funds set aside to be used in connection with) taxes bank accounts and payroll bank accounts and (C) zero balance accounts that sweep to an account over which the Secured Parties have a perfected security interest each Business Day; and

  	(h)	any United States “intent-to-use” trademark applications; 

  provided, that, Excluded Assets shall not include any Proceeds, substitutions or replacements of any Excluded Assets referred to in clauses (a) through (g) above (unless such Proceeds, substitutions or replacements would independently constitute Excluded Assets referred to in clauses (a) through (g) above).

  Section 4.	Further Assurances; Remedies. In furtherance of the grant of the security interest pursuant to Section 3, the Grantors hereby jointly and severally agree with the Secured Parties as follows:

  	4.01	Delivery and Other Perfection. Each Grantor shall promptly from time to time give, execute, deliver, file, record, authorize or obtain all such financing statements, continuation statements, notices, instruments, documents, agreements or consents or other papers as may be necessary or desirable in the reasonable judgment of Administrative Agent to create, preserve, perfect, maintain the perfection of or validate the security interest granted pursuant hereto or to enable the Secured Parties to exercise and enforce their rights hereunder with respect to such security interest, and without limiting the foregoing, shall:

  	(a)	if any of the Pledged Shares, Investment Property or Financial Assets constituting part of the Collateral are received by the Grantor, forthwith (x) deliver to Administrative Agent the certificates or instruments representing or evidencing the same, duly endorsed in blank or accompanied by such instruments of assignment and transfer in such form and substance as Administrative Agent may reasonably request, all of which thereafter shall be held by Administrative Agent, pursuant to the terms of this Agreement, as part of the Collateral and (y) take such other action as Administrative Agent may reasonably deem necessary or appropriate to duly record or otherwise perfect the security interest created hereunder in such Collateral;

  	(b)	promptly from time to time deliver to Administrative Agent any and all Instruments in excess of $250,000 in the aggregate for all Instruments constituting part of the Collateral, endorsed and/or accompanied by such instruments of assignment and transfer in such form and substance as Administrative Agent may reasonably request; provided that (other than in the case of the Promissory Notes described in Schedule 3) at all times other than after the occurrence and during the continuance of an Event of Default, such Grantor may retain for collection in the ordinary course any Instruments received by such Grantor in 

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  the ordinary course of business and Administrative Agent shall, promptly upon request of such Grantor, make appropriate arrangements for making any Instrument delivered by such Grantor available to such Grantor for purposes of presentation, collection or renewal (any such arrangement to be effected, to the extent requested by Administrative Agent, against trust receipt or like document);

  	(c)	(i)	promptly from time to time enter into such control agreements, each in form and substance acceptable to Administrative Agent, as may be required to perfect the security interest created hereby in any and all Deposit Accounts, Investment Property, Electronic Chattel Paper and Letter-of-Credit Rights (but, in each case, only to the extent constituting Collateral), and will promptly furnish to Administrative Agent true copies thereof; except with respect to Federal A/R Accounts;

  	(ii)	ensure at all times that all Federal A/R Accounts are subject to an arrangement whereby all funds on deposit therein automatically shall be swept at the end of each Business Day into an account over which Secured Parties have “control” (as defined in the UCC); and

  	(iii)	 (A) in the case of account debtors that make payments to such Grantor directly into an account, ensure that all such account debtors (1) other than Medicare, Medicaid or any other Federal government agency, are instructed to make such payments into a Deposit Account other than a Federal A/R Account, and (2) consisting of Medicare, Medicaid or any other Federal government agency, are instructed to make such payments into a Federal A/R Account, and (B) deposit all checks received directly by such Grantor from account debtors (1) other than Medicare, Medicaid or any other Federal government agency, into an account over which Secured Parties have “control” (as defined in the UCC), and (2) consisting of Medicare, Medicaid or any other Federal government agency, into a Federal A/R Account;

  	(d)	promptly from time to time upon the request of Administrative Agent, (i) execute and deliver such Short-Form IP Security Agreements as Administrative Agent may deem necessary or desirable to protect the interests of the Secured Parties in respect of that portion of the Collateral consisting of Intellectual Property, and (ii) take such other action as Administrative Agent may reasonably deem necessary or appropriate to duly record or otherwise perfect the security interest created hereunder in that portion of the Collateral consisting of Intellectual Property registered or located outside of the United States;

  	(e)	keep proper books and records relating to the Collateral in accordance with GAAP, and stamp or otherwise mark such books and records in such manner as Administrative Agent may reasonably require in order to reflect the security interests granted by this Agreement;

  	(f)	permit representatives of Administrative Agent and the Secured Parties, upon reasonable notice, at any time during normal business hours to inspect and make abstracts from its books and records pertaining to the Collateral, and permit representatives of Administrative Agent to be present at such Grantor’s place of business to receive copies of communications and remittances relating to the Collateral, and forward copies of any material notices or communications received by such Grantor with respect to the Collateral, all in such manner as Administrative Agent may reasonably require; and

  	(g)	promptly from time to time upon the request of Administrative Agent, (i) use commercially reasonable efforts to execute and deliver such Real Property Security Documents (to the extent such real property constitutes Collateral), landlord consents and collateral access agreements with respect to real property (x) owned and with a fair market value in excess of $1,000,000 for each such owned real property 

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  or (y) leased (as tenant) by such Grantor, in each case in the United States; provided that, notwithstanding anything to the contrary in any Loan Document, no leasehold mortgages shall be required and (ii) cause to be recorded in the appropriate real property records such documents delivered pursuant to this Section 4.01(h) as Administrative Agent may reasonably deem necessary or appropriate.

  	4.02	Other Financing Statements or Control. Except as otherwise permitted under the Loan Documents, no Grantor shall (a) file or suffer to be on file, or authorize or permit to be filed or to be on file, in any jurisdiction, any financing statement or like instrument with respect to any of the Collateral in which the Secured Parties are not named as the sole secured parties (except to the extent that such financing statement or instrument relates to a Permitted Lien or to the extent that such financing statement or like instrument was filed without the authorization of the Grantors, in which case the Grantors shall use commercially reasonable efforts to terminate such financing statement or like instrument) or (b) cause or permit any Person other than Administrative Agent or the Secured Parties to have “control” (as defined in Section 9-104, 9- 105, 9-106 or 9-107 of the NYUCC) of any Deposit Account, Securities Account, Commodity Account, Electronic Chattel Paper, Investment Property or Letter-of-Credit Right constituting part of the Collateral.

  	4.03	Preservation of Rights. The Secured Parties shall not be required to take steps necessary to preserve any rights against prior parties to any of the Collateral.

  	4.04	Special Provisions Relating to Certain Collateral.

  	(a)	Pledged Shares.

  	(i)	The Grantors will cause the Pledged Shares to constitute at all times (1) 100% of the total number of Shares of each Issuer (other than a First-Tier Foreign Subsidiary that is not a Grantor) then outstanding owned by the Grantors and (2) in the case of any Issuer that is a First-Tier Foreign Subsidiary and is not a Grantor, 65% (or such greater percentage as may be provided pursuant to Section 3.02(a)) of the total number of shares of voting stock of such Issuer and 100% of the total number of shares of all other classes of capital stock of such Issuer then issued and outstanding owned by the Grantors.

  	(ii)	At all times other than after the occurrence and during the continuance of an Event of Default, the Grantors shall have the right to exercise all voting, consensual and other powers of ownership pertaining to the Pledged Shares for all purposes not inconsistent with the terms of this Agreement, the other Loan Documents or any other instrument or agreement referred to herein or therein; provided that the Grantors jointly and severally agree that they will not vote the Pledged Shares in any manner that is inconsistent with the terms of this Agreement, the other Loan Documents or any such other instrument or agreement; and Administrative Agent and Secured Parties shall execute and deliver to the Grantors or cause to be executed and delivered to the Grantors all such proxies, powers of attorney, dividend and other orders, and all such instruments, without recourse, as the Grantors may reasonably request for the purpose of enabling the Grantors to exercise the rights and powers that they are entitled to exercise pursuant to this Section 4.04(a)(ii).

  	(iii)	At all times other than after the occurrence and during the continuance of an Event of Default, the Grantors shall be entitled to receive and retain any dividends, distributions or proceeds on the Pledged Shares paid in cash out of earned surplus or otherwise paid in accordance with the Loan Agreement.

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  	(iv)	Upon the occurrence and during the continuance of an Event of Default, whether or not the Secured Parties or any of them exercises any available right to declare any Secured Obligations due and payable or seeks or pursues any other relief or remedy available to them under applicable law or under this Agreement, the other Loan Documents or any other agreement relating to such Secured Obligation, all dividends and other distributions on the Pledged Shares shall be paid directly to Administrative Agent for distribution to the Secured Parties and retained by them as part of the Collateral, subject to the terms of this Agreement, and, if Administrative Agent shall so request in writing, the Grantors jointly and severally agree to execute and deliver to Administrative Agent appropriate additional dividend, distribution and other orders and documents to that end; provided that if such Event of Default is waived in writing by Administrative Agent in accordance with the Loan Agreement, any such dividend or distribution theretofore paid to Administrative Agent shall, upon request of the Grantors (except to the extent theretofore applied to the Secured Obligations), be returned by Administrative Agent to the Grantors.

  	(b)	Intellectual Property. (i) For the purpose of enabling the Secured Parties to exercise rights and remedies under Section 4.05 at such time as the Secured Parties shall be lawfully and contractually entitled to exercise such rights and remedies, and for no other purpose, each Grantor hereby grants to Administrative Agent, to the extent assignable, an irrevocable, non-exclusive license (exercisable without payment of royalty or other compensation to such Grantor) to use, and the right to assign, license or sublicense, any of the Intellectual Property now owned or hereafter acquired by such Grantor, wherever the same may be located, including in such license reasonable access to all media in which any of the licensed items may be recorded or stored and to all computer programs used for the compilation or printout thereof.

  	(ii)	Notwithstanding anything contained herein to the contrary, but subject to any provision of the Loan Documents that limits the rights of any Grantor to dispose of its property, at all times other than after the occurrence and during the continuance of an Event of Default, the Grantors will be permitted to exploit, use, enjoy, protect, defend, enforce, license, sublicense, assign, sell, dispose of or take other actions with respect to the Intellectual Property in the ordinary course of the business of the Grantors. In furtherance of the foregoing, at all times other than after the occurrence and during the continuance of an Event of Default, the Secured Parties or Administrative Agent shall from time to time, upon the request of the respective Grantor, execute and deliver any instruments, certificates or other documents, in the form so requested, that the Grantors shall have certified are appropriate in their judgment to allow them to take any action permitted above (including relinquishment of the license provided pursuant to Section 4.04(b)(i) as to any specific Intellectual Property). Further, upon the payment in full of all of the Secured Obligations (other than contingent indemnification obligations for which no claim has been made) or earlier expiration of this Agreement or release of the Collateral, Administrative Agent shall grant back to the Grantors the license granted pursuant to Section 4.04(b)(i). The exercise of rights and remedies under Section 4.05 by the Secured Parties shall not terminate the rights of the holders of any licenses, covenants not to sue or sublicenses theretofore granted by the Grantors in accordance with the first sentence of this Section 4.04(b)(ii).

  	(c)	Chattel Paper. The Grantors will, to the extent Chattel Paper is valued in excess of $250,000 in the aggregate, deliver to Administrative Agent each original of each item of Chattel Paper at any time constituting part of the Collateral.

  	4.05	Remedies. (a) Rights and Remedies Generally upon Event of Default. Upon the occurrence and during the continuance of an Event of Default, the Secured Parties shall have all of the rights and 

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  remedies with respect to the Collateral of a secured party under the NYUCC (whether or not the Uniform Commercial Code is in effect in the jurisdiction where the rights and remedies are asserted) and such additional rights and remedies to which a secured party is entitled under the laws in effect in any jurisdiction where any rights and remedies hereunder may be asserted, including the right, to the fullest extent permitted by law, to exercise all voting, consensual and other powers of ownership pertaining to the Collateral as if the Secured Parties were the sole and absolute owner thereof (and each Grantor agrees to take all such action as may be appropriate to give effect to such right). Upon the occurrence and during the continuance of an Event of Default, Administrative Agent may exercise, on behalf of all the Secured Parties, such rights and remedies of the Secured Parties described above; and without limiting the foregoing:

  	(i)	Administrative Agent may, in its name or in the name of any Grantor or otherwise, demand, sue for, collect or receive any money or other property at any time payable or receivable on account of or in exchange for any of the Collateral, but shall be under no obligation to do so;

  	(ii)	Administrative Agent may make any reasonable compromise or settlement deemed desirable with respect to any of the Collateral and may extend the time of payment, arrange for payment in installments, or otherwise modify the terms of, any of the Collateral;

  	(iii)	Administrative Agent may require the Grantors to notify (and each Grantor hereby authorizes Administrative Agent to so notify) each account debtor in respect of any Account, Chattel Paper or General Intangible, and each obligor on any Instrument, constituting part of the Collateral that such Collateral has been assigned to the Secured Parties hereunder, and to instruct that any payments due or to become due in respect of such Collateral shall be made directly to Administrative Agent or as it may direct (and if any such payments, or any other Proceeds of Collateral, are received by any Grantor they shall be held in trust by such Grantor for the benefit of the Secured Parties and as promptly as possible remitted or delivered to Administrative Agent for application as provided herein);

  	(iv)	Administrative Agent may require the Grantors to assemble the Collateral at such place or places, convenient to the Secured Parties and the Grantors, as Administrative Agent may direct;

  	(v)	Administrative Agent may require the Grantors to cause the Pledged Shares to be transferred of record into the name of Administrative Agent or its nominee (and Administrative Agent agrees that if any of such Pledged Shares is transferred into its name or the name of its nominee, Administrative Agent will thereafter promptly give to the respective Grantor copies of any notices and communications received by it with respect to such Pledged Shares); and

  	(vi)	Administrative Agent may sell, lease, assign or otherwise dispose of all or any part of the Collateral, at such place or places as Administrative Agent deems best, and for cash or for credit or for future delivery (without thereby assuming any credit risk), at public or private sale, without demand of performance or notice of intention to effect any such disposition or of the time or place thereof (except such notice as is required by applicable statute and cannot be waived), and the Secured Parties, Administrative Agent or anyone else may be the purchaser, lessee, assignee or recipient of any or all of the Collateral so disposed of at any public sale (or, to the extent permitted by law, at any private sale) and thereafter hold the same absolutely, free from any claim or right of whatsoever kind, including any right or equity of redemption (statutory or otherwise), of the Grantors, any such demand, notice and right or equity being hereby expressly waived and released. In the event of any sale, assignment, or other disposition of any of 

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  the Collateral consisting of Trademarks, the goodwill connected with and symbolized by the Trademarks subject to such disposition shall be included. Administrative Agent may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for the sale, and such sale may be made at any time or place to which the sale may be so adjourned.

  	(vii)	The Proceeds of each collection, sale or other disposition under this Section 4.05, including by virtue of the exercise of any license granted to Administrative Agent in Section 4.04(b), shall be applied in accordance with Section 4.09.

  	(b)	Certain Securities Act Limitations. The Grantors recognize that, by reason of certain prohibitions contained in the Securities Act of 1933, as amended, and applicable state securities laws, Administrative Agent may be compelled, with respect to any sale of all or any part of the Collateral, to limit purchasers to those who will agree, among other things, to acquire the Collateral for their own account, for investment and not with a view to the distribution or resale thereof. The Grantors acknowledge that any such private sales may be at prices and on terms less favorable to Administrative Agent than those obtainable through a public sale without such restrictions, and, notwithstanding such circumstances, agree that any such private sale shall be deemed to have been made in a commercially reasonable manner and that Administrative Agent shall have no obligation to engage in public sales and no obligation to delay the sale of any Collateral for the period of time necessary to permit the issuer thereof to register it for public sale.

  	(c)	Notice. The Grantors agree that to the extent Administrative Agent is required by applicable law to give reasonable prior notice of any sale or other disposition of any Collateral, ten business days’ notice shall be deemed to constitute reasonable prior notice.

  	(d)	No Assumption of Obligations. Notwithstanding any provision in this Agreement or any other Loan Document to the contrary, the Secured Parties are not assuming any liability or obligation of any Grantor or any of its Affiliates of whatever nature, whether presently in existence or arising or asserted hereafter. All such liabilities and obligations shall be retained by and remain obligations and liabilities of the applicable Grantor and/or its Affiliates, as the case may be. Without limiting the foregoing, the Secured Parties are not assuming and shall not be responsible for any liabilities or Claims of any Grantor or its Affiliates, whether present or future, absolute or contingent and whether or not relating to a Grantor, the Obligor Intellectual Property, and/or the Material Agreements, and each Grantor shall indemnify and save harmless the Secured Parties from and against all such liabilities, Claims and Liens.

  	4.06	Deficiency. If the proceeds of sale, collection or other realization of or upon the Collateral pursuant to Section 4.05 are insufficient to cover the costs and expenses of such realization and the payment in full in cash of the Secured Obligations (other than contingent indemnification obligations for which no claim has been made), the Grantors shall remain liable for any deficiency.

  	4.07	Locations; Names, Etc. No Grantor shall (i) change its location (as defined in Section 9-307 of the NYUCC), (ii) change its name from the name shown as its current legal name on Schedule 1, or (iii) agree to or authorize any modification of the terms of any item of Collateral that would result in a change thereof from one Uniform Commercial Code category to another such category (such as from a General Intangible to Investment Property), if the effect thereof would be to result in a loss of perfection of, or 

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  diminution of priority for, the security interests created hereunder in such item of Collateral, or the loss of control (within the meaning of Section 9-104, 9-105, 9-106 or 9-107 of the NYUCC) over such item of Collateral, unless in each case 10 Business Days’ prior written notice has been provided to Administrative Agent and such change is not otherwise restricted by the terms of any Loan Document. No Grantor shall store its Collateral with an aggregate value in excess of $250,000 at any time with a bailee, consignee or similar party, except for such bailees, consignees and similar parties as are disclosed on Schedule 1, unless in each case written notice is provided to Administrative Agent with the immediately succeeding Compliance Certificate required to be delivered pursuant to the Loan Agreement.

  	4.08	Private Sale. The Secured Parties shall incur no liability as a result of the sale of the Collateral, or any part thereof, at any private sale pursuant to Section 4.05 conducted in a commercially reasonable manner. Each Grantor hereby waives any claims against Administrative Agent, the Secured Parties or any of them arising by reason of the fact that the price at which the Collateral may have been sold at such a private sale was less than the price that might have been obtained at a public sale or was less than the aggregate amount of the Secured Obligations, even if Administrative Agent, the Secured Parties or any of them accepts the first offer received and does not offer the Collateral to more than one offeree.

  	4.09	Application of Proceeds. Except as otherwise herein expressly provided and except as provided below in this Section 4.09, the Proceeds of any collection, sale or other realization of all or any part of the Collateral pursuant hereto, and any other cash at the time held by Administrative Agent or the Secured Parties under this Section 4, shall be applied by Administrative Agent or the Secured Parties (as the case may be):

  First, to the payment of the costs and expenses of such collection, sale or other realization, including reasonable out-of-pocket costs and expenses of the Secured Parties and the fees and expenses of their agents and counsel, and all expenses incurred and advances made by the Secured Parties in connection therewith;

  Next, to the payment in full of the Secured Obligations (other than contingent indemnification obligations for which no claim has been made) in such order as the Secured Parties in their sole discretion shall determine; and

  Finally, to the payment to the respective Grantor, or its successors or assigns, or as a court of competent jurisdiction may direct, of any surplus then remaining.

  	4.10	Attorney in Fact. Without limiting any rights or powers granted by this Agreement to the Secured Parties, upon the occurrence and during the continuance of an Event of Default, Administrative Agent (and any of its officers, employees or agents) hereby is appointed the attorney in fact of each Grantor for the purpose of carrying out the provisions of this Section 4 and taking any action and executing any instruments that Administrative Agent may deem necessary or advisable to perfect Administrative Agent’s security interest or Lien in the Collateral and to accomplish the purposes hereof, which appointment as attorney in fact is irrevocable and coupled with an interest. Without limiting the generality of the foregoing, so long as Administrative Agent shall be entitled under this Section 4 to make collections in respect of the Collateral, Administrative Agent shall have the right and power to receive, endorse and collect all checks made payable to the order of any Grantor representing any dividend, payment or other distribution in respect of the Collateral or any part thereof and to give full discharge for the same.

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  	4.11	Perfection and Recordation. Each Grantor authorizes the Secured Parties to file Uniform Commercial Code financing statements describing the Collateral as “all assets” or “all personal property and fixtures” of such Grantor (provided that no such description shall be deemed to modify the description of Collateral set forth in Section 3).

  	4.12	Termination.

  	(a)	When all Secured Obligations (other than contingent indemnification obligations for which no claim has been made) shall have been paid in full in cash and the other conditions specified in Section 12.10(b)(iii) of the Loan Agreement have been met, this Agreement automatically shall terminate, and the Secured Parties shall, upon request of Grantors, cause to be assigned, transferred and delivered, against receipt but without any recourse, warranty or representation whatsoever, any remaining Collateral and money received in respect thereof, to or on the order of the respective Grantor and to be released and canceled all licenses and rights referred to in Section 4.04(b), in each case, at Grantors’ sole expense.

  	(b)	The Liens granted to the Administrative Agent pursuant to this Agreement on any item of Collateral shall be automatically released upon the occurrence of any of the following:

  	(i)	upon the sale of such Collateral by any Grantor to any Person that is not a Grantor (and is not required to become a Grantor under the Loan Documents) in a transaction permitted under the Loan Agreement; and

  	(ii)	to the extent that the property constituting such Collateral is owned by any Grantor (other than Borrower or Holdings), upon the release of such Grantor from its obligations under Section 14 of the Loan Agreement.

  	(c)	The Secured Parties shall also, at the expense of such Grantor, execute and deliver to such Grantor upon such termination or release such Uniform Commercial Code termination statements, certificates for terminating the liens on the Motor Vehicles and such other documentation as shall be reasonably requested by the respective Grantor to affect the termination and/or release of the liens on the Collateral as required by this Section 4.12, in each case, at Grantors’ sole expense.

  	4.13	Further Assurances. Each Grantor agrees that, from time to time upon the written request of Administrative Agent, such Grantor will execute and deliver such further documents and do such other acts and things as Administrative Agent may request in order fully to effect the purposes of this Agreement and take all further action that may be required under applicable law (including the laws of each jurisdiction in which each Grantor or any of its Subsidiaries is organized), or that Administrative Agent may reasonably request, in order to grant, preserve, protect and perfect the validity and priority of the Liens created or intended to be created by the Loan Documents. Each Grantor will promptly cause any subsequently acquired or organized Subsidiary required pursuant to the Loan Agreement to guarantee the Secured Obligations to take such action as shall be necessary to ensure that it is a “Subsidiary Guarantor” in accordance with Section 8.12 of the Loan Agreement and enter into such other security agreements and take such other actions as may be required or reasonably requested by Administrative Agent for the Secured Parties to have a valid first priority Lien on and security interest in all of the assets of such Subsidiary (in each case, subject to Permitted Liens). Such Liens will be created under the Loan Documents in form and substance satisfactory to Administrative Agent and each Grantor shall deliver or cause to be delivered to 

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  Administrative Agent all such instruments and documents as Administrative Agent shall reasonably request to evidence compliance with this Section 4.13. The Secured Parties shall release any lien covering any asset that has been disposed of in accordance with the provisions of the Loan Documents.

  Section 5.	Miscellaneous.

  	5.01	Notices. All notices, requests, consents and demands hereunder shall be delivered in accordance with Section 13.02 of the Loan Agreement.

  	5.02	No Waiver. No failure on the part of any Secured Party to exercise, and no course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by any Secured Party of any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The remedies herein are cumulative and are not exclusive of any remedies provided by law.

  	5.03	Amendments, Etc. The terms of this Agreement may be waived, altered or amended only by an instrument in writing duly executed by each Grantor and Administrative Agent (unless the consent of a different group of Persons is required in accordance with Section 13.04 of the Loan Agreement).

  	5.04	Expenses.

  	(a)	The Grantors shall pay or reimburse Administrative Agent and the Secured Parties for costs and expenses in accordance with Section 13.03 of the Loan Agreement.

  	(b)	The Grantors shall hereby indemnify the Secured Parties, their Affiliates, and their respective directors, officers, employees, attorneys, agents, advisors and controlling parties in accordance with Section 13.03(b) of the Loan Agreement.

  	5.05	Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the respective successors and permitted assigns of each Grantor, Administrative Agent and the Secured Parties.

  	5.06	Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and any of the parties hereto may execute this Agreement by signing any such counterpart.

  	5.07	Governing Law; Submission to Jurisdiction; Etc. (a) Governing Law. This Agreement and the rights and obligations of the parties hereunder shall be governed by, and construed in accordance with, the law of the State of New York, without regard to principles of conflicts of laws that would result in the application of the laws of any other jurisdiction; provided that Section 5-1401 of the New York General Obligations Law shall apply.

  	(b)	Submission to Jurisdiction. Each Grantor agrees that any suit, action or proceeding with respect to this Agreement or any other Loan Document to which it is a party or any judgment entered by any court in respect thereof may be brought initially in any court of the State of New York sitting in New York County (Borough of Manhattan) or of the United States for the Southern District of New York or in the courts of its own corporate domicile and irrevocably submits to the non-exclusive jurisdiction of each 

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  such court for the purpose of any such suit, action, proceeding or judgment. This Section 5.07(b) is for the benefit of the Secured Parties only and, as a result, no Secured Party shall be prevented from taking proceedings in any other courts with jurisdiction. To the extent allowed by applicable Laws, the Secured Parties may take concurrent proceedings in any number of jurisdictions.

  	(c)	Waiver of Venue. Each Grantor irrevocably waives to the fullest extent permitted by law any objection that it may now or hereafter have to the laying of the venue of any suit, action or proceeding arising out of or relating to this Agreement and hereby further irrevocably waives to the fullest extent permitted by law any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. A final judgment (in respect of which time for all appeals has elapsed) in any such suit, action or proceeding shall be conclusive and may be enforced in any court to the jurisdiction of which such Grantor is or may be subject, by suit upon judgment.

  	(d)	Service of Process. Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 5.01. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

  	5.08	WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5.08.

  	5.09	Captions. The captions and section headings appearing herein are included solely for convenience of reference and are not intended to affect the interpretation of any provision of this Agreement.

  	5.10	Agents and Attorneys in Fact. The Secured Parties may employ agents and attorneys in fact in connection herewith.

  	5.11	Severability. If any provision hereof is invalid and unenforceable in any jurisdiction, then, to the fullest extent permitted by law, (a) the other provisions hereof shall remain in full force and effect in such jurisdiction and shall be liberally construed in favor of the Secured Parties in order to carry out the intentions of the parties hereto as nearly as may be possible and (b) the invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction.

  	5.12	Additional Grantors. Additional Persons may from time to time after the date of this Agreement become Grantors under this Agreement by executing and delivering to Administrative Agent a supplemental agreement (together with all schedules thereto, a “Joinder”) to this Agreement, in 

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  substantially the form attached hereto as Exhibit A. Accordingly, upon the execution and delivery of any such Joinder by any such Person, such Person shall automatically and immediately, and without any further action on the part of any Person, become a “Grantor” under and for all purposes of this Agreement, and each of the Schedules hereto shall be supplemented in the manner specified in such Joinder. In addition, upon the execution and delivery of any such Joinder, the new Grantor makes the representations and warranties set forth in Section 2.

  	5.13	Healthcare Savings Clause. Notwithstanding anything herein or in any other Loan Document to the contrary or otherwise, it is the intention of the Secured Parties and the Obligors to conform strictly to any applicable regulatory requirements for the Healthcare Subsidiaries. In the event any enforcement of any Loan Document could result in changes to pledged equity, cash reserves or minimum net assets or equity of any of the Healthcare Subsidiaries in violation of applicable law or regulation, the Secured Parties will observe all applicable requirements of law or regulation in connection with such enforcement action, including whether to seek regulatory approval from the applicable state or Federal agency prior to any enforcement action, including, to the extent required by applicable law or regulation, any such enforcement action that may result in a change of control of any Healthcare Subsidiary or any of its parent companies.

  [SIGNATURE PAGES FOLLOW]

   

   

   

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

   

  ALIGNMENT HEALTHCARE USA, LLC,

  as Grantor

   

   

  By  /s/ Thomas Freeman				

  	Name: Thomas Freeman

  	Title:  Chief Financial Officer

   

   

  ALIGNMENT HEALTHCARE HOLDCO 2, LLC, as Grantor

   

   

  By  /s/ Thomas Freeman				

  	Name: Thomas Freeman

  	Title:  Chief Financial Officer

   

   

  ALIGNMENT HEALTHCARE HOLDCO 1, LLC,

  as Grantor

   

   

  By  /s/ Thomas Freeman				

  	Name: Thomas Freeman

  	Title:  Chief Financial Officer

   

   

  ALIGNMENT HEALTHCARE, INC., 
as Grantor

   

   

  By  /s/ Thomas Freeman				

  	Name: Thomas Freeman

  	Title:  Chief Financial Officer

   

   

  ALIGNMENT HEALTH ADVISORS, LLC, 
as Grantor

   

   

  By  /s/ Thomas Freeman				

  	Name: Thomas Freeman

  	Title:  Chief Financial Officer

   

  Signature Page to Security Agreement

  

   

  secure health holdings, llc, 
as Grantor

  By: Alignment Healthcare USA, LLC, its Manager

  By  /s/ Thomas Freeman				

  	Name: Thomas Freeman

  	Title:  Chief Financial Officer

   

   

   

   

   

   

  Signature Page to Security Agreement

  

   

  OXFORD FINANCE LLC, as Administrative

  Agent

   

  	By:  /s/ Colette H. Featherly	

  	 

  	Name: Colette H. Featherly

  	Title:  Senior Vice President

   

  Signature Page to Security Agreement

  

  	 

   

  FORM OF JOINDER AGREEMENT

  JOINDER AGREEMENT dated as of [  ] (this “Joinder”) by [NAME OF ADDITIONAL GRANTOR], a [  ] [  ] (the “Additional Grantor”), in favor of each Lender, each other Secured Party (each as defined in the Loan Agreement referred to below) and OXFORD FINANCE LLC, as administrative agent and collateral agent (in such capacities, together with its successors and assigns, the “Administrative Agent”) for the Secured Parties.

  	A.	Reference is made to (i) the Term Loan Agreement, dated as of September 2, 2022 (as amended, supplemented, restated, extended, renewed or replaced from time to time, the “Loan Agreement”), among ALIGNMENT HEALTHCARE USA, LLC, a Delaware limited liability company (“Borrower”), ALIGNMENT HEALTHCARE HOLDCO 2, LLC, a Delaware limited liability company (“Holdings”), ALIGNMENT HEALTHCARE HOLDCO 1, LLC, a Delaware limited liability company (“Healthcare Holdco”), ALIGNMENT HEALTHCARE, INC., a Delaware corporation (“Parent”), the subsidiary guarantors from time to time party thereto, the Lenders from time to time party thereto and Administrative Agent, and (ii) the Security Agreement, dated as of September 2, 2022 (as amended, supplemented, restated, extended, renewed or replaced from time to time, the “Security Agreement”; capitalized terms used herein but not defined shall have the meaning ascribed to such terms therein), among Parent, Healthcare Holdco, Holdings, Borrower, the other Grantors party thereto and Administrative Agent.

  	B.	Section 5.12 of the Security Agreement provides that additional Persons may from time to time after the date of the Security Agreement become Grantors under the Security Agreement by executing and delivering to the Secured Parties a supplemental agreement to the Security Agreement in the form of this Joinder.

  	C.	To induce the Secured Parties to maintain the term loans pursuant to the Loan Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Additional Grantor has agreed to execute and deliver (i) a Guarantee Assumption Agreement under the Loan Agreement and (ii) this Joinder.

  	The Additional Grantor hereby agrees to become a “Grantor” for all purposes of the Security Agreement (and hereby supplements each of the Schedules to the Security Agreement in the manner specified in Appendix A hereto). Without limitation, as collateral security for the payment in full when due (whether at stated maturity, by acceleration or otherwise) of the Secured Obligations (other than contingent indemnification obligations for which no claim has been made), the Additional Grantor hereby pledges and grants to the Secured Parties as provided in Section 3 of the Security Agreement a security interest in all of the Additional Grantor’s right, title and interest in, to and under the Collateral of the Additional Grantor, in each case whether tangible or intangible, wherever located, and whether now owned by the Additional Grantor or hereafter acquired and whether now existing or hereafter coming into existence. In addition, the Additional Grantor hereby makes the representations and warranties set forth in Section 2 of the Security Agreement, with respect to itself and its obligations under this Joinder, as if each reference in such Sections to the Loan Documents included reference to this Joinder.

  [SIGNATURE PAGES FOLLOW]

   

   

  

   

  IN WITNESS WHEREOF, the Additional Grantor has caused this Joinder to be duly executed and delivered as of the day and year first above written.

   

  [INSERT NAME OF ADDITIONAL GRANTOR],

  as Grantor

   

   

  By  	

  	Name:	

  	Title:  	

  OXFORD FINANCE LLC, as Administrative

  Agent

   

  	By	

  	Name:	

  	Title:EX-10.3

  Exhibit 10.3

   

   

   

   

   

   

  EMPLOYMENT AGREEMENT

  BETWEEN

  ALIGNMENT HEALTHCARE USA, LLC

  AND

  JOSEPH KONOWIECKI

  OCTOBER 31, 2022

   

   

   

   

   

   

   

   

   

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  EMPLOYMENT AGREEMENT

  THIS EMPLOYMENT AGREEMENT is made and entered into effective as of October 31, 2022 (the “Effective Date”), by and between Alignment Healthcare USA, LLC, a California corporation (the “Employer”), and Joseph Konowiecki (the “Employee”).

  WHEREAS, Employee currently serves as a non-employee director and Chairman of the Board of Alignment Healthcare, Inc. (“Parent”), the indirect parent of Employer;

  WHEREAS, in addition to services Employee provides to Parent as a member of Parent’s Board of Directors, Employee and Parent are parties to a Consulting Agreement, dated as of January 1, 2022 (the “Consulting Agreement”), pursuant to which Employee provides Parent with certain limited advisory services relating to Parent’s business and financial strategies in the areas of corporate development and network management; and

   

  WHEREAS, Employer and Employee now desire to terminate the Consulting Agreement and for Employee to enter into an employment relationship with Employer and to assume a role as an executive officer of Parent, on the terms and subject to the conditions set forth in this Agreement, while continuing to serve concurrently as Chairman of the Board of Parent;

  NOW, THEREFORE, in consideration of the covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows.

  1.Definitions.  Generally, defined terms used in this Agreement are defined in the first instance in which they appear herein.  In addition, the following terms and phrases have the following meanings:

  “Affiliate” means, when used with reference to a specified Person, (a) any Person who directly or indirectly controls, is controlled by or is under common control with the specified Person, (b) any Person who is an officer, director, partner, member, manager or trustee of, or serves in a similar capacity with respect to, the specified Person, or for which the specified Person is an officer, director, partner, member or manager or trustee or serves in a similar capacity, (c) any Person who, directly or indirectly, is the beneficial owner of 10% or more of any class of equity securities of the specified Person, or of which the specified Person, directly or indirectly, is the owner of 10% or more of any class of equity securities and (d) any member of such specified Person’s immediate family.

  “Board” means the board of directors of Parent or any other Person the Board has appointed or delegated authority.

  “Cause” means the Employee’s:

  (i)failure to devote substantially all Employee’s working time to the business of the Employer and its Affiliates;

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  (ii)willful disregard of Employee’s duties, or Employee’s intentional failure to act where the taking of such action would be in the ordinary course of the Employee’s duties hereunder, provided that the Employee is first given 30 days prior written notice of such conduct in order for the Employee to cure such alleged conduct during such period of time;

  (iii)violation or breach of the provisions, representations or covenants of Sections 10, 11, 15 or 16(a);

  (iv)gross negligence or willful misconduct in the performance of Employee’s duties hereunder;

  (v)commission of any act of fraud, theft or financial dishonesty, or any felony or criminal act involving moral turpitude; or

  (vi)unlawful use (including being under the influence) of alcohol or drugs or possession of illegal drugs while on the premises of the Employer or any of its Affiliates or while performing duties and responsibilities to the Employer and its Affiliates.

  “Confidential Information” means all proprietary and other information relating to the business and operations of the Employer and its Affiliates, which has not been specifically designated for release to the public by an authorized representative of the Employer or one of its Affiliates, including, but not limited to the following: (i) information, observations, procedures and data concerning the business or affairs of the Employer or any of its Affiliates; (ii) products or services; (iii) costs and pricing structures; (iv) analyses; (v) drawings, photographs and reports; (vi) computer software, including operating systems, applications and program listings; (vii) flow charts, manuals and documentation; (viii) databases; (ix) accounting and business methods; (x) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice; (xi) customers, vendors, suppliers and customer, vendor and supplier lists; (xii) business goals, plans, techniques and strategies; (xiii) other copyrightable works; (xiv) all production methods, processes, technology and trade secrets; and (xv) all similar and related information in whatever form.  Confidential Information also includes any information that the Employer or any of its Affiliates have received, or may receive hereafter, belonging to customers or other third parties with any understanding, express or implied, that the information would not be disclosed.  Confidential Information will not include any information that has been published in a form generally available to the public (through no wrongful act of the Employee) prior to the date the Employee proposes to disclose or use such information.  Confidential Information will not be deemed to have been published merely because individual portions of the information have been separately published, but only if all material features comprising such information have been published in combination.

  “Disability” means the Employee’s inability, due to physical or mental illness or disability, to perform the essential functions of Employee’s employment with the Employer, even with reasonable accommodation that does not impose an undue hardship on the Employer, for more than 60 consecutive days, or for any 90 days within any one 

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  year period, unless a longer period is required by federal or state law, in which case such longer period will be applicable.  The Employer reserves the right, in good faith, to make the determination of Disability under this Agreement based on information supplied by the Employee and/or Employee’s medical personnel, as well as information from medical personnel selected by the Employer or its insurers.

  “Employer” has the meaning set forth in the preamble; provided that, for purposes of Sections 8 through 15, “Employer” includes Parent and all of its Subsidiaries and Affiliates.  All references in this Agreement to Parent shall refer to Alignment Healthcare Holdings, LLC prior to its conversion into Alignment Healthcare, Inc. unless the context indicates otherwise.

  “Good Reason” means:

  (i)a material reduction during any 24 consecutive month period in Base Salary (as that term is defined in Section 4(a)) or in the Employee’s annual total cash compensation opportunity (i.e., Base Salary and Target Bonus Percentage (as that term is defined in Section 4(b))), but excluding any reduction applicable to management employees generally;

  (vii)a material breach of this Agreement by the Employer; or

  (viii)a change in the Employee’s principal work location to a location more than 50 miles from the Employee’s prior work location and more than 50 miles from the Employee’s principal residence as of the date of such change in work location.

  Notwithstanding the foregoing provisions of this definition, Good Reason shall not exist (A) if the Employee has in Employee’s sole discretion agreed in writing that such event shall not be Good Reason or (B) unless, (I) within 60 days of the occurrence of the events claimed to be Good Reason the Employee notifies the Employer in writing of the reasons why Employee believes that Good Reason exists, (II) the Employer has failed to correct the circumstance that would otherwise be Good Reason within 30 days of receipt of such notice, and (III) the Employee terminates Employee’s employment within 60 days of such 30-day period (the date of such resignation, the “Early Resignation Date”).

  “Person” shall be construed broadly and shall include, without limitation, an individual, a partnership, an investment fund, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.

  “Subsidiary” or “Subsidiaries” of any Person means any corporation, partnership, joint venture or other legal entity of which such Person (either alone or through or together with any other Person), owns, directly or indirectly, 50% or more of the stock or other equity interests which are generally entitled to vote for the election of the board of directors or other governing body of such corporation or other legal entity.

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  “Termination Date” means the effective date of the termination of the Employee’s employment hereunder, which (i) in the case of termination due to resignation by the Employee without Good Reason, shall mean the date that is 90 days following the date of the Employee’s written notice to the Employer of Employee’s resignation, or in the case of resignation by the Employee with Good Reason, shall mean the Early Resignation Date, provided, however, that in each case the Employer may accelerate the Termination Date; (ii) in the case of termination by reason of the Employee’s death, shall mean the date of death; (iii) in the case of termination by reason of Disability, shall mean the date specified in the notice of such termination delivered to the Employee by the Employer; (iv) in the case of a termination by the Employer for Cause or without Cause, shall mean the date specified in the written notice of such termination delivered to the Employee by the Employer; (iv) in the case of termination by mutual agreement, shall mean the date mutually agreed to by the parties hereto, (v) in the case of termination due to either party’s delivery to the other party of a Notice of Nonrenewal pursuant to Section 2, shall mean the next scheduled Renewal Date to which the Notice of Nonrenewal relates.

  2.Employment.  

  (a)The Employer shall employ the Employee, and the Employee accepts employment with the Employer, upon the terms and conditions set forth in this Agreement. The initial term of this Agreement (the “Initial Term”) shall commence on the Effective Date and end on the first annual anniversary of the Effective Date; provided, however, that on the first annual anniversary of the date hereof and each annual anniversary thereafter (each, a “Renewal Date”), the term of this Agreement shall be extended by one additional year (each, an “Extension Term,” and collectively with the Initial Term, the “Employment Period”) unless either party gives written notice to the other within 90 days in advance of the next scheduled Renewal Date that it does not wish to extend the Employment Period (such notice, a “Notice of Nonrenewal”); and provided, further, that the Employment Period may be sooner terminated as provided herein.

  (b)As of the Effective Date, the Consulting Agreement shall terminate and shall be of no further force and effect, and neither Employer, Parent or Employee shall have any further obligations pursuant thereto.  The parties acknowledge and agree that notwithstanding anything contained in the Consulting Agreement to the contrary, the termination of the Consulting Agreement shall be treated as a termination by Parent, without cause, and accordingly, a prorated portion of the Equity Award (as defined in the Consulting Agreement) shall vest based on the number of days that have elapsed during the term of the Consulting Agreement as of the date of such termination.

  3.Position and Duties.  During the Employment Period, the Employee shall be employed by Employer on a full-time basis in an executive role and, subject to the discretion of the Board, shall continue to concurrently serve as Chairman of the Board of Parent.  Employee’s executive role will not have a separate title and shall consist of leading network and corporate development strategies. In connection with the executive role, Employee shall report to the Chief Executive Officer and shall further undertake such other customary duties as reasonably may be determined and assigned to Employee by the Chief Executive Officer from time to time. For so long as Employee continues to serve as 

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  Chairman of the Board of Parent, Employee shall have the usual and customary duties, responsibilities and authority of such position and shall be accountable to the Board with respect to such duties.  The Employee further agrees to perform such other duties and responsibilities on behalf of the Employer and Parent as reasonably may be directed by the Employer or Parent, including, if elected or appointed thereto, to serve as an officer and/or member of the board or any Subsidiary or Affiliate of the Employer as reasonably requested by the Employer and its Affiliates, in each case, without additional compensation hereunder. The Employee hereby accepts such employment and positions and agrees to diligently and conscientiously devote Employee’s full and exclusive business time, attention, and best efforts in discharging and fulfilling Employee’s duties and responsibilities hereunder.  The Employee shall comply with the Employer’s policies and procedures and the direction and instruction of the Board, and the Employee shall not engage in any business activity which, in the reasonable judgment of the Board, conflicts with the duties of the Employee hereunder, whether or not such activity is pursued for gain, profit or other pecuniary advantage.  As of the Effective Date, Employee hereby resigns from his position as a member of the Compensation Committee of the Board and the Nominating, Corporate Governance and Compliance Committee of the Board.

  4.Compensation.  

  (a)Salary.  During the Employment Period, the Employer shall pay the Employee a base salary at the rate of $560,000 per annum (as may be increased from time to time at the discretion of the Employer, the “Base Salary”), less applicable deductions and withholdings.

  (b)Performance Bonus.  In addition to the Base Salary, during the Employment Period, the Employee shall be eligible to receive a cash bonus (the “Bonus”) with respect to each calendar year. The amount of the Bonus, if any, payable in respect of any calendar year will be determined based on the achievement of the Employer’s performance metrics, achievement of performance goals established for the Employee, or a combination of the foregoing. The target Bonus amount (the “Target Bonus Percentage”) and the maximum Bonus amount (the “Maximum Bonus Percentage”) in respect of each calendar year will equal 85% and 170%, respectively, of the Base Salary payable to the Employee for such year. The Bonus in respect to any calendar year shall be prorated for partial years. A Bonus will not be paid for the calendar year in which the Employee initiates employment with the Employer if the Employee’s start date occurs on or after October 1. If a Bonus is awarded with respect to a calendar year, approximately 80% of the Bonus will be paid on or before June 1st, and the remainder will be paid on or before October 31st, of the year immediately following such calendar year. As a condition to receiving the Bonus, the Employee must be an employee of Employer in good standing as of the applicable Bonus payment date. 

  (c)Employee Benefits.  During the Employment Period, retirement, health and welfare benefits shall be subject to the Employer’s policies and practices and the terms of the applicable benefit plans and arrangements as in effect from time to time.  The Employee shall accrue paid-time off at the rate of five (5) weeks per twelve (12) months of employment.

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  (d)Reimbursements.  The Employer shall reimburse the Employee for all reasonable and necessary business-related expenses incurred by Employee in the course of performing Employee’s duties under this Agreement which are consistent the Employer’s policies in effect from time to time with respect to travel, entertainment and other business expenses, subject to the Employer’s requirements with respect to reporting and documentation of such expenses.

  (e)Deductions and Withholding.  The Employer shall deduct from any payments to be made by it to or on behalf of the Employee under this Agreement any amounts required to be withheld in respect of any federal, state or local income or other taxes.

  (f)Annual Review of Base Salary and Bonus Percentages.  The Board (or the Compensation Committee of the Board) shall undertake a review of rate of Base Salary and the Target Bonus Percentage and Maximum Bonus Percentage (the “Bonus Percentages”) not less frequently than annually during the Employment Period and may increase, but not decrease, the rate of Base Salary and the Bonus Percentages from those then in effect.

  (g)Equity Grants.  The Employee will be eligible to receive the following equity grants (“Equity Awards”) on November 7, 2022 (unless Parent is not on such date in an open trading window under its Insider Trading Policy, in which case Employee shall be granted the Equity Awards on the first day of the next open trading window) (the “Grant Date”): (i) a stock option to purchase shares of common stock of Parent, at an exercise price per share equal to the closing per share price of Parent’s common stock on the Grant Date, with the number of shares subject to the stock option that is necessary to cause the Black-Scholes-Merton value of such stock option on the Grant Date to be equal to $250,000, which stock option will vest in equal installments of twenty-five percent (25%) each on the first four anniversaries of the Grant Date (subject to the Employee’s continued employment on the applicable vesting date); and (ii) a number of restricted stock units of Parent equal to (A) $750,000 divided by the closing per share price of Parent’s common stock on the Grant Date minus (B) 7,318 restricted stock units (the “Grant Adjustment”), which restricted stock units will vest in equal installments of twenty-five percent (25%) each on the first four anniversaries of the Grant Date (subject to the Employee’s continued employment on the applicable vesting date).  Employee acknowledges and agrees that the Grant Adjustment is being made in consideration of the continued vesting of the full amount of the equity award granted in March 2022 under the Parent’s Non-Employee Director Compensation Policy.  The Equity Awards shall be subject to the terms of Alignment’s 2021 Equity Incentive Plan and the terms of the applicable award agreements.  During the Employment Period, the Employee will be eligible to receive equity grants in the form of stock options, and restricted stock units or other equity incentive awards at the discretion of the Board of Directors (or a committee thereof) and subject to their approval. The amount of equity, if any, issuable in respect of any calendar year will be based on the achievement of Employer’s corporate performance metrics, achievement of individual performance goals established for the Employee, or a combination of the foregoing.  

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  (h)Compensation for Service as Director.  For the avoidance of doubt, the compensation set forth in this Section 4 is inclusive of compensation for Employee’s service as a member of the Board of Directors of Parent, and during the term of this Agreement, Employee will no longer receive any separate compensation under Parent’s non-employee director policy (the “Non-Employee Director Policy”), provided, however, that unvested equity awards issued pursuant to the Non-Employee Director Policy and outstanding as of the date hereof (the “Prior Grants”) will continue in accordance with their terms.  If the Employee’s employment under this Agreement is terminated for any reason but the Board, in its sole and absolute discretion, desires for him to continue to serve as a member of the Board notwithstanding such termination of employment, (i) the Prior Grants will continue in accordance with their terms; (ii) Employee shall be compensated under the Non-Employee Director Policy, and (iii) vesting of the Equity Awards shall terminate (notwithstanding anything to the contrary in the applicable award agreements), provided, however, that Employee shall be entitled to receive the equity award issuable under the Non-Employee Director Policy to other directors for the calendar year in which the termination occurs, on the same terms and conditions (including vesting schedule and conditions) as such other directors.  For the avoidance of doubt, in the event Employee’s employment under this Agreement is terminated for any reason, there are no assurances that Employee will continue to serve as a member of the Board, or as Chairman of the Board, and such determination shall be made by the Board in its sole and absolute discretion.

  5.Termination of Employment.  The Employee’s employment under this Agreement shall be terminated upon the earliest to occur of the following events:

  (a)Termination for Cause.  The Employer may in its sole discretion terminate this Agreement and the Employee’s employment hereunder for Cause at any time and with or without advance notice to the Employee.

  (b)Termination without Cause.  The Employer may terminate this Agreement and the Employee’s employment hereunder without Cause at any time, with or without notice, for any reason or no reason (and no reason need be given).

  (c)Mutual Agreement.  This Agreement and the Employee’s employment hereunder may be terminated by the mutual written agreement of the Employer and the Employee.

  (d)Termination by Death or Disability.  This Agreement and the Employee’s employment hereunder shall automatically terminate upon the Employee’s death or Disability.

  (e)Resignation.  The Employee may terminate this Agreement and Employee’s employment hereunder without Good Reason upon 90 days advance written notice to the Employer.  In addition, the Employee may terminate this Agreement and Employee’s employment hereunder with Good Reason as of the Early Resignation Date.

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  (f)Nonrenewal.  If either party delivers to the other a Notice of Nonrenewal, this Agreement and the Employee’s employment hereunder shall automatically terminate as of the next scheduled Renewal Date to which the Notice of Nonrenewal relates.

  6.Compensation upon Termination.

  (a)General.  In the event of the Employee’s termination of employment for any reason, the Employee or Employee’s estate or beneficiaries shall have the right to receive the following:

  (i)the unpaid portion of the Base Salary and paid time off accrued and payable through the Termination Date;

  (ii)reimbursement for any expenses for which the Employee shall not have been previously reimbursed, as provided in Section 4(d); and

  (iii)continuation of health insurance coverage rights, if any, as required under applicable law.

  (b)Termination for Cause; Resignation without Good Reason; Mutual Agreement; Nonrenewal by the Employee; Death or Disability.

  (i)In the event of the Employee’s termination of employment by reason of (A) a termination by the Employer for Cause, (B) resignation by the Employee without Good Reason or (C) mutual agreement, the Employer shall have no current or further obligations (including Base Salary) to the Employee under this Agreement other than as set forth in Section 6(a).

  (ii)In the event of the Employee’s termination of employment by reason of (A) the Employee’s death, (B) the Employee’s Disability or (C) delivery by the Employee of a Notice of Nonrenewal, the Employer shall have no current or further obligations (including Base Salary) to the Employee under this Agreement other than as set forth in Section 6(a) and payment of any Bonus for any calendar year preceding the calendar year in which termination occurs which has not yet been paid, payable at the time bonuses for such calendar year are otherwise payable to senior executives of the Employer (“Prior Year Bonus”).

  (c)Termination without Cause, Resignation with Good Reason or Nonrenewal by the Employer.  In the event of the Employee’s termination of employment hereunder by reason of (i) a termination by the Employer without Cause, (ii) resignation by the Employee with Good Reason or (iii) delivery by the Employer of a Notice of Nonrenewal, the Employer shall pay or provide to the Employee the payments and benefits set forth in Section 6(a) and payment of any Prior Year Bonus.  In addition, subject to the Employee’s execution and non-revocation of a customary general waiver and release of claims in such form as provided by the Employer (a “Release”) in accordance with Section 6(d) and the Employee’s continued full performance of obligations under Sections 10 and 11, and in lieu of any severance benefits that may be payable to the Employee under a 

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  separate severance agreement or an executive severance plan as a result of such termination, the Employer shall pay or provide to the Employee the following (the “Severance Benefits”):

  (i)severance pay in an aggregate amount equal to one (1.0) times the sum of (1) Base Salary plus (2) the Target Bonus Percentage, paid in substantially equal installments over the 12-month period following the Termination Date in accordance with the Employer’s normal payroll practices;

  (ii)a pro rata amount of the Bonus, if any, which would have been payable to the Employee for the calendar year in which the Termination Date occurs, determined after the end of the calendar year in which such Termination Date occurs and equal to the amount which would have been payable to the Employee if Employee’s employment had not been terminated during such calendar year multiplied by the fraction, the numerator of which is the number of whole months the Employee was employed by the Employer during such calendar year and the denominator of which is 12 (or, in the case of calendar year 2022, the number of whole months on and after the Effective Date during such year); it being understood that any pro rata bonus payable under this clause (ii) shall be paid in a lump sum at the time bonuses for such calendar year are otherwise payable to senior executives of the Employer; and

  (iii)if the Employee elects COBRA benefits, the Employer shall pay or reimburse the Employee’s share of the premium for such COBRA benefits until the earlier of (A) the first annual anniversary of Termination Date; or (B) the date that the Employee is eligible to receive health benefits through new employment; it being understood that (x) the Employee is required to notify the Employer immediately if Employee begins new employment during such period and to repay promptly any excess benefits contributions made by the Employer; and (y) after the Employer’s payment or reimbursement obligation ends, the Employee may continue benefits coverage for the remainder of the COBRA period, if any, by paying the full premium cost of such benefits.

  (d)Release Condition.  Notwithstanding anything to the contrary in this Agreement, to the extent that any payments due under this Agreement as a result of the termination of the Employee’s employment are subject to the Employee’s execution and delivery of a Release, (i) no such payments shall be made prior to the first normal payroll date of the Employer occurring on or after the Release Effective Date, (ii) the Employer shall deliver the Release to the Employee within ten business days following the Termination Date, (iii) if the Employee fails to execute the Release on or prior to the Release Expiration Date (as defined below) or the Employee timely revokes Employee’s acceptance of the Release within the seven day period following the Release Expiration Date, the Employee shall not be entitled to the Severance Benefits otherwise conditioned on the Release, and (iv) if the Employee executes the Release on or prior to the Release Expiration Date and does not timely revoke Employee’s acceptance of the Release within the seven day period following the Release Expiration Date, any Severance Benefits that would otherwise have been paid to the Employee prior to the first normal payroll date of the Employer occurring on or after the Release Effective Date but for clause (i) above shall be paid on the first normal payroll date of the Employer occurring on or after the Release 

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  Effective Date.  For purposes of this Section 6(d), “Release Expiration Date” shall mean the date that is 21 days following the date upon which the Employer timely delivers the Release to the Employee, or, in the event that termination of the Employee’s employment is “in connection with an exit incentive or other employment termination program” (as such phrase is defined in the Age Discrimination in Employment Act of 1967), the date that is 45 days following such delivery date, and “Release Effective Date” shall mean the eighth day following the Release Expiration Date, provided that the Employee executes the Release on or prior to the Release Expiration Date and does not timely revoke Employee’s acceptance of the Release within the seven day period following the Release Expiration Date.

  (e)Exclusive Remedy.  The rights of the Employee set forth in this Section 6 are intended to be the Employee’s exclusive remedy for termination and any severance benefits related thereto and, to the greatest extent permitted by applicable law, the Employee waives all other remedies.

  7.Insurance.  The Employer or one of its Affiliates may, for its own benefit, maintain “key man” life and disability insurance policies covering the Employee.  The Employee will cooperate with the Employer or its Affiliates and provide such information or other assistance as they may reasonably request in connection with obtaining and maintaining such policies.

  8.The Employee’s Termination Obligations.  The Employee hereby acknowledges and agrees that all personal property and equipment furnished to or prepared by the Employee in the course of or incident to Employee’s employment hereunder belongs to the Employer and shall be promptly returned to the Employer upon termination of the Employee’s employment or, at any event, at the Employer’s request.  The term “personal property” includes, without limitation, all office equipment, laptop computers, cell phones, books, manuals, records, reports, notes, contracts, requests for proposals, bids, lists, blueprints, and other documents, or materials, or copies thereof (including computer files), and all other proprietary and non-proprietary information relating to the business of the Employer.  Following termination of Employee’s employment hereunder, the Employee will not retain any written or other tangible material containing any proprietary or non-proprietary information of the Employer.

  9.Acknowledgment of Protectable Interests.  The Employee acknowledges and agrees that Employee’s employment with the Employer involves building and maintaining business relationships and good will on behalf of the Employer with customers, patients, physicians and other professional contractors, employees and staff, and various providers and users of health care services; that Employee is entrusted with proprietary, strategic and other confidential information which is of special value to the Employer; and that the foregoing matters are significant interests that the Employer is entitled to protect.

  10.Confidential Information.  All Confidential Information that comes or has come into the Employee’s possession by reason of Employee’s employment hereunder is the property of the Employer and shall not be used except in the course of employment by the Employer and for the Employer’s exclusive benefit.  Further, the Employee shall not, 

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  during Employee’s employment or thereafter, disclose or acknowledge the content of any Confidential Information to any person who is not an employee of the Employer authorized to possess such Confidential Information.  Upon termination of employment, the Employee shall deliver to the Employer all documents, writings, electronic storage devices, and other tangible things containing any Confidential Information and the Employee shall not make or retain copies, excerpts, or notes of such information.

  11.Restrictive Covenants.

  (a)During the Employment Period, the Employee shall not, directly or indirectly, without written approval by the Board, accept or perform any work, consulting, or other services for any other business entity or for remuneration of any kind.  Without limiting the foregoing, during the Employment Period, the Employee shall not, directly or indirectly, without written approval by the Board, engage in activities or businesses (including, without limitation, owning any interest in, managing, controlling, participating in, consulting with, advising, rendering services for, or in any manner engaging in the business of owning, operating or managing any business) that are principally or primarily involved in holding, managing or acquiring investments in the healthcare industry or other similar business in which the Employer is engaged (or so engage with, for or on behalf of any customer of the Employer), provided, however, that neither (i) the passive ownership by the Employee of not more than 2.0% of the outstanding equity securities of a publicly traded company nor (ii) the Employee’s ownership of the securities or interests described on Schedule 1 shall constitute a violation of this Section 11(a).  If the Employee acquires knowledge of a business venture which may be a business venture or prospective business venture (“Corporate Opportunity”) in which the Employer could have an interest or expectancy, or otherwise is exploiting any Corporate Opportunity, the Employee shall promptly bring such opportunity to the Employer.  The Employee shall not have the right to hold any such Corporate Opportunity for Employee’s own account or benefit (or for the account or benefit of Employee’s agents’, partners’ or Affiliates’), or to recommend, assign or otherwise transfer or deal in such Corporate Opportunity with Persons other than the Employer.

  (b)During the Employment Period and for a period of one year thereafter, the Employee shall not, directly or indirectly, solicit, induce or encourage any employee of the Employer to terminate Employee’s employment with the Employer or hire or attempt to hire any employee of the Employer.

  (c)During the Employment Period and for a period of one year thereafter, the Employee shall not, directly or indirectly, use the Employer’s Confidential Information to induce, attempt to induce or knowingly encourage any Customer (as defined below) of the Employer to divert any business or income from the Employer, or to stop or alter the manner in which it is then doing business with the Employer.  The term “Customer” with respect to the Employer shall mean any individual or business firm that is, or within the prior 24 months was, a customer or client of the Employer, or whose business was actively solicited by the Employer at any time, regardless of whether such customer or client was generated, in whole or in part, by the Employee’s efforts.

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  (d)During the Employment Period and thereafter, the Employee shall not make any disparaging statement concerning the Employer or its Affiliates, or their respective predecessors and successors, or any of the current or former directors, employees, officers, managers, shareholders, partners, members, agents or representatives of any of the foregoing (the “Protected Persons”) to the extent such statement could be reasonably likely to damage the reputation and/or financial position of any of the Protected Persons.  Notwithstanding the foregoing, nothing herein shall or shall be deemed to prevent or impair the Employee from (i) testifying truthfully in any legal or administrative proceeding if such testimony is compelled or requested, (ii) making competitive-type statements that are normal and customary for the industry in the context of product or service comparisons and the like, or (iii) making good faith statements in the good faith performance of the Employee’s duties for the Employer or its Affiliates.

  (e)The Employee acknowledges that the provisions of Sections 10 and 11 are reasonable and necessary to protect the continuing interests of the Employer, and any violation of Sections 10 and 11 will result in irreparable injury to the Employer, the exact amount of which will be difficult to ascertain, and that the remedies at law for any such violation would not reasonably or adequately compensate the Employer for such violation.  Accordingly, the Employee agrees that if the Employee violates any of the provision of Sections 10 and 11, in addition to any other remedy that may be available at law or in equity, the Employer shall be entitled to specific performance and injunctive relief, without the necessity of proving actual damages or posting of a bond or other security.

  12.Damages For Improper Termination With Cause.  If the Employer terminates this Agreement and the Employee’s employment hereunder for Cause, but it subsequently is determined by a court of competent jurisdiction, as the case may be, that the Employer did not have Cause for the termination, then for purposes of this Agreement, the Employer’s decision to terminate shall be deemed to have been a termination without Cause, and the Employer shall be obligated to pay the Severance Benefits specified under Section 6(c), and, subject to Section 24 hereof, only that amount.

  13.Arbitration.  

  (a)Except as provided in Section 13(b) below, any controversy or dispute arising out of, based upon, or relating to this Agreement, its enforcement or interpretation, or because of an alleged breach, default, or misrepresentation in connection with any of its provisions, or arising out of, based upon, or relating in any way to the Employee’s employment or association with the Employer, or termination of the same, including, without limiting the generality of the foregoing, any questions regarding whether a particular dispute is arbitrable, and any alleged violation of statute, common law or public policy, including, but not limited to, any state or federal statutory claims, shall be submitted to final and binding arbitration in Orange County, California, in accordance with the JAMS Employment Arbitration Rules and Procedures, before a single neutral arbitrator selected from the JAMS panel, or if JAMS is no longer able to supply the arbitrator, such arbitrator shall be selected from the American Arbitration Association, in accordance with its National Rules for the Resolution of Employment Disputes (the arbitrator selected 

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  hereunder, the “Arbitrator”).  Provisional injunctive relief may, but need not, be sought by either party to this Agreement in a court of law while arbitration proceedings are pending, pursuant to California Code of Civil Procedure section 1281.8, and any provisional injunctive relief granted by such court shall remain effective until the matter is finally determined by the Arbitrator.  Final resolution of any dispute through arbitration may include any remedy or relief which the Arbitrator deems just and equitable, including any and all remedies provided by applicable state or federal statutes.  At the conclusion of the arbitration, the Arbitrator shall issue a written decision that sets forth the essential findings and conclusions upon which the Arbitrator’s award or decision is based.  Any award or relief granted by the Arbitrator hereunder shall be final and binding on the parties hereto and may be enforced by any court of competent jurisdiction.  To the extent permitted by law, the arbitrator’s fees and arbitration expenses and any other costs associated with the arbitration or arbitration hearing that are unique to arbitration will be borne equally by each party.  The parties shall each pay their own deposition, witness, expert and attorneys’ fees and other expenses as and to the same extent as if the matter were being heard in court, provided that the arbitrator may in its discretion award costs to the prevailing party if it determines that to be appropriate.

  (b)Notwithstanding the foregoing, the Employee agrees that it would be difficult to measure any damages caused to the Employer which might result from any breach by the Employee of the covenants set forth in Sections 10, 11, 14 or 15, and that in any event, money damages would be an inadequate remedy for any such breach.  Accordingly, if the Employee has breached, breaches, or proposes to breach Sections 10, 11, 14 or 15, the Employer shall be entitled, in addition to all other remedies such party may have, to a temporary, preliminary or permanent injunction or other appropriate equitable relief to restrain any such breach without showing or proving any actual damage to the non-breaching party from any court having competent jurisdiction over either party.

  (c)THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL, INCLUDING ANY RIGHTS TO TRIAL BY JURY, IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES AGAINST THE OTHER IN CONNECTION WITH ANY MATTER WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT OR THE PROVISION OF SERVICES UNDER THIS AGREEMENT.

  14.Cooperation.  Upon the receipt of reasonable notice from the Employer (including from outside counsel to the Employer), the Employee agrees that while employed by the Employer and after the termination of the Employee’s employment for any reason, the Employee will respond and provide information with regard to matters in which the Employee has knowledge as a result of the Employee’s employment with the Employer, and will provide reasonable assistance to the Employer, its Affiliates and their respective representatives in defense of any claims that may be made against the Employer or its Affiliates, and will assist the Employer and its Affiliates in the prosecution of any claims that may be made by the Employer or its Affiliates, to the extent that such claims may relate to the period of the Employee’s employment with the Employer, provided, that with respect to periods after the termination of the Employee’s employment, the Employer shall reimburse the Employee for any reasonable out-of-pocket expenses incurred in 

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  providing such assistance and, with respect to any period in which the Employee is required to provide more than ten hours of assistance per week after Employee’s termination of employment but is not receiving severance payments from the Employer or its Affiliates, and is not testifying, the Employer shall pay the Employee a reasonable amount of money for Employee’s services at a reasonable rate agreed to between the Employer and the Employee; and provided further that after the Employee’s termination of employment with the Employer, such assistance shall not unreasonably interfere with the Employee’s business or personal obligations.  The Employee agrees to promptly inform the Employer if the Employee becomes aware of any lawsuits involving such claims that may be filed or threatened against the Employer or its Affiliates.  The Employee also agrees to promptly inform the Employer (to the extent the Employee is legally permitted to do so) if the Employee is asked to assist in any investigation of the Employer or its Affiliates (or their actions), regardless of whether a lawsuit or other proceeding has then been filed against the Employer or its Affiliates with respect to such investigation, and shall not do so unless legally required.

  15.Disclosure and Assignment of Inventions and Improvements.  Without prejudice to any other duties express or implied imposed on the Employee hereunder it shall be part of the Employee’s normal duties at all times to consider in what manner and by what methods or devices the products, services, processes, equipment or systems of the Employer and any customer or vendor of the Employer might be improved and promptly to give to the Chief Executive Officer of the Employer or Employee’s designee full details of any improvement, invention, research, development, discovery, design, code, model, suggestion or innovation (collectively called “Work Product”), which the Employee (alone or with others) may make, discover, create or conceive in the course of the Employee’s employment.  The Employee acknowledges that the Work Product is the property of the Employer.  To the extent that any of the Work Product is capable of protection by copyright, the Employee acknowledges that it is created within the scope of the Employee’s employment and is a work made for hire.  To the extent that any such material may not be a work made for hire, the Employee hereby assigns to the Employer all rights in such material.  To the extent that any of the Work Product is an invention, discovery, process or other potentially patentable subject matter (the “Inventions”), the Employee hereby assigns to the Employer all right, title, and interest in and to all Inventions.  The Employer acknowledges that the assignment in the preceding sentence does not apply to an Invention that the Employee develops entirely on Employee’s own time without using the Employer’s equipment, supplies, facilities or trade secret information, except for those Inventions that either:

  (i)relate at the time of conception or reduction to practice of the Invention to the Employer’s business, or actual or demonstrably anticipated research or development of the Employer, or

  (ii)result from any work performed by the Employee for the Employer.

  Execution of this Agreement constitutes the Employee’s acknowledgment of receipt of written notification of this Section 15 and of notice of the general exception to assignments 

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  of Inventions provided under the Uniform Employee Patents Act, in the form adopted by the state having jurisdiction over this Agreement or provision, or any comparable applicable law.

  16.Representations and Warranties; Advice of Counsel.

  (a)The Employee represents and warrants that (i) Employee is under no contractual or other obligation that would prevent Employee from accepting the Employer’s offer of employment as set forth herein, (ii) Employee has the full right, authority and capacity to enter into this Agreement and to perform Employee’s obligations hereunder, (iii) the execution of this Agreement and the performance of Employee’s obligations hereunder will not breach or be in conflict with any other agreement to which the Employee is a party or is bound, and (iv) the Employee is not now subject to, and has not previously violated, any covenants against competition, solicitation, hire or similar covenants, any court order or other legal obligation, or other agreement that would affect the performance of Employee’s obligations hereunder or would otherwise conflict with, prevent or restrict the full performance of Employee’s duties and obligations to the Employer or any of its Affiliates before, during or after the Employment Period.  The Employee covenants that Employee will not disclose or use on behalf of the Employer or its Affiliates any proprietary information of a third party without such party’s consent.

  (b)Prior to execution of this Agreement, the Employee was advised by the Employer of the Employee’s right to seek independent advice from an attorney of the Employee’s own selection regarding this Agreement.  The Employee acknowledges that the Employee has entered into this Agreement knowingly and voluntarily and with full knowledge and understanding of the provisions of this Agreement after being given the opportunity to consult with counsel.  The Employee further represents that in entering into this Agreement, the Employee is not relying on any statements or representations made by any of the directors, officers, employees or agents of the Employer or any of its Affiliates which are not expressly set forth herein, and that the Employee is relying only upon the Employee’s own judgment and any advice provided by the Employee’s attorney.

  17.Entire Agreement.  This Agreement is intended by the parties to be the final expression of their agreement with respect to the employment of the Employee by the Employer and may not be contradicted by evidence of any prior or contemporaneous agreement (including, without limitation any term sheet or similar agreement entered into between the Employer or any Affiliate and the Employee).  The parties further intend that this Agreement shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.

  18.No Other Representations.  Except as expressly provided in this Agreement, (i) no person or entity has made or has the authority to make any representations or promises on behalf of any of the parties which are inconsistent with the representations or promises contained in this Agreement, and (ii) this Agreement has not been executed in reliance on any representations or promises not set forth herein.  Specifically, no promises, warranties or representations have been made by anyone on any topic or subject matter 

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  related to the Employee’s relationship with the Employer or any of its Affiliates or any of their executives or employees, including but not limited to any promises, warranties or representations regarding future employment, compensation, benefits, any entitlement to equity interests in the Employer or any of its Affiliates or regarding the termination of the Employee’s employment.  In this regard, the Employee agrees that no promises, warranties or representations shall be deemed to be made in the future unless they are set forth in writing and signed by an authorized representative of the Employer.

  19.Amendments.  This Agreement may be modified only by agreement of the parties by a written instrument executed by the parties that is designated as an amendment to this Agreement.

  20.Severability and Non-Waiver/Survival.  Any provision of this Agreement (or portion thereof) which is deemed invalid, illegal or unenforceable in any jurisdiction shall, as to that jurisdiction and subject to this Section 20, be ineffective to the extent of such invalidity, illegality or unenforceability, without affecting in any way the remaining provisions thereof in such jurisdiction or rendering such provision or any other provision of this Agreement invalid, illegal, or unenforceable in any other jurisdiction.  If any covenant should be deemed invalid, illegal or unenforceable because its scope is considered excessive, such covenant shall be modified so that the scope of the covenant is reduced only to the minimum extent necessary to render the modified covenant valid, legal and enforceable.  No waiver of any provision or violation of this Agreement by the Employer shall be implied by the Employer’s forbearance or failure to take action.  The expiration or termination of the Employment Period and this Agreement shall not impair the rights or obligations of any party hereto which shall have accrued hereunder prior to such expiration or termination.

  21.Successor/Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, representatives, executors, administrators, successors, and assigns, provided, however, that the Employee may not assign any or all of Employee’s rights or duties hereunder.  The Employee shall be entitled, to the extent permitted under applicable law, to select and change a beneficiary or beneficiaries to receive any compensation or benefit hereunder following the Employee’s death by giving written notice thereof.  In the event of the Employee’s death or a judicial determination of Employee’s incompetence, references in this Agreement to the Employee shall be deemed, where appropriate, to refer to Employee’s beneficiary, estate or other legal representative.

  22.Voluntary and Knowledgeable Act.  The Employee represents and warrants that the Employee has read and understands each and every provision of this Agreement and has freely and voluntarily entered into this Agreement.

  23.Choice of Law.  This Agreement shall be construed and enforced under and be governed as to its validity and effect by the laws of the State of California without regard to the conflict of laws principles thereof.

  24.Attorneys’ Fees.  If any dispute between the parties should result in litigation, the prevailing party in such dispute shall be entitled to recover from the other 

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  party all reasonable out-of-pocket fees, costs and expenses of enforcing any right of the prevailing party, including without limitation, reasonable attorneys’ fees and expenses, all of which shall be deemed to have accrued upon the commencement of such action and shall be paid whether or not such action is prosecuted to judgment.  Any judgment or order entered in such action shall contain a specific provision providing for the recovery of attorneys’ fees and costs incurred in enforcing such judgment and an award of prejudgment interest from the date of the breach at the maximum rate of interest allowed by law.  For the purposes of this Section 24: (a) attorneys’ fees include, without limitation, fees incurred in the following: (i) post-judgment motions; (ii) contempt proceedings; (iii) garnishment, levy, and debtor and third party examinations; (iv) discovery and (v) bankruptcy litigation, and (b) “prevailing party” means the party who is determined in the proceeding to have prevailed or who prevails by dismissal, default or otherwise.

  25.Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but both of which together shall constitute one and the same instrument.

  26.Notices.  Except as otherwise provided for herein, all notices and other communications provided for hereunder shall be in writing (including facsimile communication and electronic mail) and mailed (via registered or certified mail), telecopied or delivered to the party for whom it is intended at the address, telecopier number or e-mail address set forth below or, as to each party, at such other address as designated by that party in a written notice to the other parties.  All notices and communications shall be deemed to have been validly served, given or delivered (i) if personally delivered, upon receipt or refusal to accept delivery, (ii) if sent via facsimile, upon mechanical confirmation of successful transmission thereof generated by the sending facsimile machine, (iii) if sent by a commercial overnight courier for delivery on the next business day, on the first business day after deposit with such courier service (or the second business day if sent to an address not in the United States), (iv) if sent by registered or certified mail, three days after deposit thereof in the United States mail, or (v) if sent by electronic mail, one business day after transmission when directed to the appropriate e-mail address (provided that the party giving notice must verify the e-mail address of the recipient prior to transmission):

  (a)if to the Employee, to Employee at Employee’s most recent address in the Employer’s records,

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  (b)If to the Employer, to:

  	Alignment Healthcare USA, LLC

  1100 Town & Country Road, Suite 1600

  Orange, CA 92868

  Facsimile:  (844) 320-2247
E-mail:  [***] 
Attention:  Corporate Secretary

  or to such other address as the recipient party to whom notice is to be given may have furnished to the other party in writing in accordance herewith.

  27.Descriptive Headings; Nouns and Pronouns.  Descriptive headings are for convenience only and shall not control or affect the meaning or construction of any provision of this Agreement.  Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice-versa.

  28.Non-Qualified Deferred Compensation.  To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), and Department of Treasury regulations and other interpretive guidance issued thereunder, including without limitation any such regulations or other guidance that may be issued after the Effective Date.  For purposes of Section 409A of the Code, each of the payments that may be made hereunder is designated as a separate payment and, for the avoidance of doubt and without limiting the foregoing, the Employee’s right to receive installment payments pursuant to Section 6(c) shall be treated as a right to receive a series of separate and distinct payments.  To the extent that any reimbursement of expenses or in-kind benefits constitutes “deferred compensation” under Section 409A of the Code, such reimbursement or benefit shall be provided no later than December 31 of the year following the year in which the expense was incurred.  The reimbursements under this Agreement are not subject to liquidation or exchange for another benefit, and the amount of expenses reimbursed in one taxable year shall not affect the amount eligible for reimbursement in any other taxable year.  Notwithstanding any provision of this Agreement to the contrary, in the event that the Employer determines that any amounts payable hereunder will be immediately taxable to the Employee under Section 409A of the Code and related Department of Treasury guidance, the Employer reserves the right (without any obligation to do so or to indemnify the Employee for failure to do so) to (a) adopt such amendments to this Agreement and appropriate policies and procedures, including amendments and policies with retroactive effect, that the Employer determines necessary or appropriate to preserve the intended tax treatment of the benefits provided by this Agreement, to preserve the economic benefits of this Agreement and to avoid less favorable accounting or tax consequences for the Employer and/or (b) take such other actions as the Employer determines necessary or appropriate to exempt the amounts payable hereunder from Section 409A of the Code and related Department of Treasury guidance, or to comply with the requirements of Section 409A of the Code and related Department of Treasury guidance, including such Department of Treasury guidance and other interpretive materials as may be issued after the Effective Date, and avoid the 

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  applicable of penalty taxes thereunder.  No provision of this Agreement shall be interpreted or construed to transfer any liability for failure to comply with the requirements of Section 409A of the Code from the Employee or any other individual to the Employer or any of its Affiliates, employees or agents.  To the extent any amounts under this Agreement are payable by reference to Employee’s “termination of employment,” such term and similar terms shall be deemed to refer to Employee’s “separation from service,” within the meaning of Section 409A of the Code.  Notwithstanding any other provision in this Agreement, to the extent any payments hereunder constitute nonqualified deferred compensation, within the meaning of Section 409A of the Code, then if the Employee is a specified employee (within the meaning of Section 409A of the Code) as of the date of Employee’s separation from service, each such payment that is payable upon the Employee’s separation from service and would have been paid prior to the six-month anniversary of Employee’s separation from service, shall be delayed until the earlier to occur of (i) the first day of the seventh month following the Employee’s separation from service or (ii) the date of the Employee’s death.

  [signature page follows]

   

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

  ALIGNMENT HEALTHCARE USA, LLC

  By:  /s/ John Kao				
Name:  John Kao
Title:  Chief Executive Officer

  
  /s/ Joseph Konowiecki			
Joseph Konowiecki, individually

   

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