Document:

ASSET PURCHASE AGREEMENT

 Exhibit 10.1 
  
 Confidential Materials omitted and filed separately with the 
 Securities and Exchange Commission. Asterisks denote omissions. 
  
 LIFELINE SYSTEMS, INC. 
  
 (the “Purchaser”) 
  
 - and - 

 
 MARCH NETWORKS CORPORATION 
  
 (the “Vendor”) 
  

  
 ASSET PURCHASE AGREEMENT 
  

  
 DATED the 16th day of July, 2003 

  
 TABLE OF CONTENTS

  

	 ARTICLE 1 – INTERPRETATION
	  	1
			
	 1.1
	  	DEFINITIONS.	  	1
	 1.2
	  	CONSTRUCTION.	  	4
	 1.3
	  	SCHEDULES.	  	5
		
	 ARTICLE 2 – PURCHASE AND SALE OF PURCHASED ASSETS
	  	5
			
	 2.1
	  	PURCHASE AND SALE.	  	5
	 2.2
	  	PURCHASE PRICE.	  	6
	 2.3
	  	ALLOCATION OF PURCHASE PRICE.	  	6
	 2.4
	  	PAYMENT OF PURCHASE PRICE.	  	6
	 2.5
	  	CALCULATION OF EARN-OUT AMOUNT.	  	6
	 2.6
	  	ESCROW AND SET-OFF.	  	7
	 2.7
	  	TRANSFER TAXES.	  	7
		
	 ARTICLE 3 – ASSUMPTION OF OBLIGATIONS
	  	7
			
	 3.1
	  	ASSUMPTION BY THE PURCHASER.	  	7
		
	 ARTICLE 4 – REPRESENTATIONS AND WARRANTIES OF THE VENDOR
	  	8
			
	 4.1
	  	REPRESENTATIONS AND WARRANTIES.	  	8
		
	 ARTICLE 5 – REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
	  	11
			
	 5.1
	  	REPRESENTATIONS AND WARRANTIES.	  	11
		
	 ARTICLE 6 – COVENANTS OF THE VENDOR
	  	12
			
	 6.1
	  	DISCLOSURE OF TRANSACTION.	  	12
	 6.2
	  	EXAMINATIONS AND INVESTIGATIONS.	  	12
	 6.3
	  	CONDUCT OF BUSINESS PRIOR TO CLOSING.	  	13
	 6.4
	  	CONSENTS AND APPROVALS.	  	14
	 6.5
	  	REPRESENTATIONS, WARRANTIES AND CONDITIONS.	  	14
	 6.6
	  	NON-COMPETITION AND NON-SOLICITATION AGREEMENT.	  	14
	 6.7
	  	REFERRAL OF COMMUNICATIONS.	  	14
	 6.8
	  	TECHNICAL SUPPORT.	  	15
	 6.9
	  	ESCROW AGREEMENT.	  	15
		
	 ARTICLE 7 – COVENANTS OF THE PURCHASER
	  	15
			
	 7.1
	  	DISCLOSURE OF TRANSACTION.	  	15
	 7.2
	  	REPRESENTATIONS, WARRANTIES AND CONDITIONS.	  	15
	 7.3
	  	INFORMING PERSONS DEALING WITH PURCHASED BUSINESS.	  	15
		
	 ARTICLE 8 – SURVIVAL AND INDEMNIFICATION
	  	16
			
	 8.1
	  	SURVIVAL OF VENDOR’S REPRESENTATIONS AND WARRANTIES.	  	16
	 8.2
	  	SURVIVAL OF PURCHASER’S REPRESENTATIONS AND WARRANTIES.	  	16
	 8.3
	  	SURVIVAL OF COVENANTS.	  	16
	 8.4
	  	INDEMNIFICATION.	  	16
	 8.5
	  	PROCEDURE FOR INDEMNIFICATION.	  	18
	 8.6
	  	ADDITIONAL RULES AND PROCEDURES.	  	19
	 8.7
	  	RIGHTS CUMULATIVE.	  	20

  

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	 ARTICLE 9 – CONDITIONS OF CLOSING IN FAVOUR OF THE PURCHASER
	  	20
			
	 9.1
	  	CONDITIONS OF CLOSING.	  	20
	 9.2
	  	WAIVER.	  	22
		
	 ARTICLE 10 – CONDITIONS OF CLOSING IN FAVOUR OF THE VENDOR
	  	22
			
	 10.1
	  	CONDITIONS OF CLOSING.	  	22
	 10.2
	  	WAIVER.	  	24
		
	 ARTICLE 11 – RISK OF LOSS
	  	24
			
	 11.1
	  	DAMAGE OR DESTRUCTION.	  	24
	 11.2
	  	NOTICE.	  	24
	 11.3
	  	NOTICE OF REDUCTION OF PURCHASE PRICE.	  	25
	 11.4
	  	PURCHASE PRICE.	  	25
	 11.5
	  	EXTENT OF LOSS.	  	25
	 11.6
	  	RIGHTS CUMULATIVE.	  	25
		
	 ARTICLE 12 – CLOSING PROCEDURE
	  	25
			
	 12.1
	  	CLOSING.	  	25
	 12.2
	  	PROCEDURE.	  	25
		
	 ARTICLE 13 – GENERAL
	  	26
			
	 13.1
	  	PUBLIC DISCLOSURE.	  	26
	 13.2
	  	ARBITRATION.	  	26
	 13.3
	  	NOTICE.	  	26
	 13.4
	  	COSTS.	  	27
	 13.5
	  	TIME OF THE ESSENCE.	  	27
	 13.6
	  	FURTHER ACTS.	  	27
	 13.7
	  	JURISDICTION.	  	27
	 13.8
	  	AMENDMENT.	  	27
	 13.9
	  	WAIVER.	  	28
	 13.10
	  	ENTIRE AGREEMENT.	  	28
	 13.11
	  	SEVERABILITY.	  	28
	 13.12
	  	COUNTERPARTS.	  	28
	 13.13
	  	ASSIGNMENT.	  	28
	 13.14
	  	ENUREMENT AND BINDING EFFECT.	  	1

  
 SCHEDULES 
  
  

 - ii - 

 ASSET PURCHASE AGREEMENT 
  
 DATED the 16th day of July, 2003. 
  
 B E T W
E E N: 
  
 LIFELINE SYSTEMS, INC., a
corporation incorporated under the laws of the State of Massachusetts 
  
 (the “Purchaser”) 
  
 - and - 
  
 MARCH NETWORKS CORPORATION, a corporation incorporated under the federal laws of Canada 
  
 (the “Vendor”) 
  
 The parties agree as follows: 
  
 ARTICLE 1 – INTERPRETATION 
  

	1.1	Definitions. 

  
 In this Agreement, except as otherwise expressly provided, capitalized words or expressions shall have the meanings set out below: 
  

	 	(a)	“Accounts Payable” means all unsecured debts of the Vendor incurred or accrued in connection with the conduct of the Purchased Business in the ordinary course of
business prior to the Time of Closing. 

  

	 	(b)	“Acquired March Customers” means those customers of the Purchased Business who are listed in Schedule 1.1(b). 

  

	 	(c)	“Affiliate” shall have the meaning given it in the Canada Business Corporations Act. 

  

	 	(d)	“Agreement” means this agreement and includes all schedules set out in section 1.3. 

  

	 	(e)	“Assumed Obligations” means all obligations to be performed by the Vendor on or after the Closing Date under the Contracts, including the provision of services
under: 

  

	 	(i)	the service agreements included therein; 

  

	 	(ii)	product warranties; 

  

 and the obligation to accept delivery of and pay for any Inventories that have been ordered but not yet
delivered to the Vendor, as set out in Schedule 1.1(e). 
  

	 	(f)	“Business Day” means every day except a Saturday, Sunday or any other day on which principal commercial banks are not open for business in the City of Ottawa,
Ontario. 

  

	 	(g)	“Closing” means the completion of the transactions described in this Agreement, “Closing Date” or “Date of Closing” means July 16, 2003, and
“Time of Closing” means 10:00 a.m. (local time) at Gowling Lafleur Henderson LLP, Suite 2600, 160 Elgin Street, Ottawa, Ontario, K1P 1C3 on the Closing Date or such other date or time as the parties may agree upon.

  

	 	(h)	“Contracts” means all oral or written material contracts of the Vendor relating exclusively to the Purchased Business, including all contracts with customers or
subscribers of the Purchased Business (collectively, the “Service Contracts”) and those listed on Schedule 1.1(h). 

  

	 	(i)	“Earn-Out Amount” means an amount equal to [**]% of all Net Revenues earned by the Purchaser, during the period commencing on the day following the Closing Date and
ending on the third anniversary of the Closing Date, from sales orders entered into during the said period in respect of sales of products and/or services to Acquired March Customers and, if applicable, following an acquisition, directly or
indirectly, by the Purchaser or any Affiliate of the Purchaser of Home Technology Systems (“HTS”) whether by purchase of shares, assets, amalgamation or other form of corporate reorganization, from sales orders entered into during the said
period in respect of sales of products and/or services to any customers of HTS. 

  

	 	(j)	“Earn-Out Statement” shall have the meaning attributed thereto in section 2.5. 

  

	 	(k)	“Encumbrance” means any mortgage, lien, pledge, charge, hypothec or other security interest, restriction, claim, encumbrance, right to use or acquire, ownership
interest, action or demand of any nature whatsoever. 

  

	 	(l)	“Escrow Agreement” shall have the meaning attributed thereto in Section 6.9. 

  

	 	(m)	“Equipment” means all equipment used exclusively in the Purchased Business, including the equipment described in Schedule 1.1(m). 

 

	 	(n)	“GAAP” means generally accepted accounting principles as set forth in the handbook published by the Canadian Institute of Chartered Accountants.

  

	 	(o)	“Goodwill” means the goodwill relating exclusively to the Purchased Business, including the customer lists set out in Schedule 1.1(o), together with the
exclusive right of the Purchaser to represent itself as carrying on the Purchased Business in continuation of and in succession to the Vendor. 

  

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	 	(p)	“Indemnification Amount” shall have the meaning attributed thereto in section 9.6(a). 

  

	 	(q)	“Indemnified Party” shall have the meaning attributed thereto in section 9.5(a). 

  

	 	(r)	“Indemnifying Party” shall have the meaning attributed thereto in section 9.5(a). 

  

	 	(s)	“Intellectual Property” means the patents, trademarks, copyrights and industrial designs owned or used by the Vendor and used exclusively in the Purchased Business,
including the intellectual property set out in Schedule 1.1(f). 

  

	 	(t)	“Inventories” means all inventories owned by the Vendor and used exclusively in carrying on the Purchased Business as a going concern including the inventory set
out in Schedule 1.1(t). 

  

	 	(u)	“Licenses” shall have the meaning attributed thereto in section 4.1(o). 

  

	 	(v)	“Losses” shall have the meaning attributed thereto in section 8.4(a). 

  

	 	(w)	“Net Revenues” means the aggregate of the total amount of the actual selling price of all goods sold and services performed by or on behalf of the Purchased
Business conducted by or on behalf of the Purchaser including, without limiting the generality of the foregoing, the amounts received for the sale or leasing of goods, the performance of services, all deposits received and not refunded to purchasers
and all other receipts or receivables whatsoever (including all interest, instalment and finance charges, without any deduction for bank charges or uncollected or uncollectible credit accounts or charges made by collection agencies) and no
allowances for bad debts. In addition each sale or service performed on an instalment or credit basis will be treated as a sale for the full selling price in the month during which such charge or sale is made, irrespective of the time when payment
is received in respect thereof (whether full or partial). 

  

	 	(x)	“Person” includes an individual, partnership, unincorporated association, organization, syndicate, corporation, trust, trustee, executor, administrator or other
legal or personal representative. 

  

	 	(y)	“Purchase Price” means the purchase price for the Purchased Assets as set forth in section 2.2. 

  

	 	(z)	“Purchased Assets” means: 

  

	 	(i)	the Contracts; 

  

	 	(ii)	the Equipment; 

  

	 	(iii)	the Goodwill; 

  

	 	(iv)	the Intellectual Property; 

  

	 	(v)	the Inventories; and 

  

	 	(vi)	the Records. 

  

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	 	(aa)	“Purchased Business” means the business currently carried on by the Vendor through its Healthcare Business Unit division, consisting of the development,
manufacture, marketing and distribution of emergency response systems in the United States and Canada targeting primarily the independent and assisted living markets in the United States and Canada, and including the Vendor’s Outreach Personal
Emergency Response Services business, but, for greater certainty, excluding the Vendor’s Telehealth and other business endeavours. 

  

	 	(bb)	“Records” means all records relating exclusively to the Purchased Business, including those listed on Schedule 1.1(bb). 

  

	 	(cc)	“Service Contracts” shall have the meaning attributed thereto in section 1.1(h). 

  

	 	(dd)	“Third Party” shall have the meaning attributed thereto in section 8.5(b) 

  

	 	(ee)	“Third Party Claim” shall have the meaning attributed thereto in section 8.5(b). 

  

	1.2	Construction. 

  
 In this Agreement: 
  

	 	(a)	words denoting the singular include the plural and vice versa and words denoting any gender include all genders; 

  

	 	(b)	the word “including” shall mean “including without limitation”; 

  

	 	(c)	any reference to a statute shall mean the statute in force as at the date hereof, unless otherwise expressly provided; 

  

	 	(d)	the use of headings is for convenience of reference only and shall not affect the construction of this Agreement; 

  

	 	(e)	any references to sections or Articles are references to sections or Articles of this Agreement; 

  

	 	(f)	when calculating the period of time within which or following which any act is to be done or step taken, the date which is the reference day in calculating such period shall be
excluded. If the last day of such period is not a Business Day, the period shall end on the next Business Day; 

  

	 	(g)	all dollar amounts are expressed in U.S. funds; 

  

	 	(h)	any tender of documents or money under this Agreement may be made upon the parties or their respective counsel and money may be tendered by bank draft drawn upon a Canadian
chartered bank or by negotiable cheque payable in U.S. funds and certified by a Canadian chartered bank; and 

  

 - 4 - 

	 	(i)	any reference to the “knowledge of the Vendor” or to the “Vendor’s knowledge” or to similar wording shall mean the knowledge of Christine Cimaglia, David
Rothwell and/or William McIntosh after making all reasonable and diligent inquiries in the circumstances. 

  

	1.3	Schedules. 

  
 The following attached Schedules form part of this Agreement: 
  

		
	 Schedule 1.1(b)
	  	Acquired March Customers
		
	 Schedule 1.1(e)
	  	Inventories ordered but not yet paid for
		
	 Schedule 1.1(f)
	  	Intellectual Property
		
	 Schedule 1.1(h)
	  	Service Contracts
		
	 Schedule 1.1(m)
	  	Equipment
		
	 Schedule 1.1(o)
	  	Customer List
		
	 Schedule 1.1(t)
	  	Inventories
		
	 Schedule 1.1(bb)
	  	Records
		
	 Schedule 2.3
	  	Allocation of Purchase Price
		
	 Schedule 4.1(a)
	  	Purchased Business Jurisdictions
		
	 Schedule 4.1(e)
	  	Contracts
		
	 Schedule 4.1(o)
	  	Licenses
		
	 Schedule 4.1(p)
	  	Litigation
		
	 Schedule 6.4(1)
	  	Consents
		
	 Schedule 6.4(2)
	  	Form of Assignment of Contracts Agreement
		
	 Schedule 6.6
	  	Form of Non-Competition Agreement
		
	 Schedule 6.8
	  	Form of Telephone Customer Support Services Agreement
		
	 Schedule 6.9
	  	Form of Escrow Agreement
		
	 Schedule 9.1(f)
	  	Form of Opinion of Vendor’s Counsel
		
	 Schedule 10.1(e)
	  	Form of Opinion of Purchaser’s Counsel
		
	 Schedule 13.2
	  	Arbitration Procedures

  
 ARTICLE 2
– PURCHASE AND SALE OF PURCHASED ASSETS 
  

	2.1	Purchase and Sale. 

  
 Subject to the terms and conditions of this Agreement, on the Closing Date, the Vendor shall sell to the Purchaser and the Purchaser shall purchase from
the Vendor the Purchased Assets in consideration of the Purchase Price. 
  

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	2.2	Purchase Price. 

  
 Subject to any adjustments pursuant to this Agreement, the Purchase Price shall be [**] Dollars ($[**]) plus the Earn-Out Amount, less [**] Dollars
($[**]), being the amount of the Assumed Liabilities provided for in sections 1.1(e)(i) and 1.1(e)(ii) (the result of such calculation being hereinafter described as the “Purchase Price”). In addition to the Purchase Price,
the Purchaser shall pay [**] Dollars ($[**]) to the Vendor on Closing in consideration for the Vendor entering into the Non-Competition and Non-Solicitation Agreement contemplated by Section 6.6, by delivery of a certified cheque or bank draft to or
to the order of the Vendor or by wire transfer in accordance with instructions received from the Vendor. 
  

	2.3	Allocation of Purchase Price. 

  
 The Purchase Price shall be allocated among the Purchased Assets in accordance with Schedule 2.3. Such allocation shall be binding and the Vendor
and the Purchaser shall make all filings which are necessary or desirable under the Income Tax Act (Canada) or any other taxation statute to give effect to such allocation. 
  

	2.4	Payment of Purchase Price. 

  
 The Purchaser shall satisfy the Purchase Price by delivering to the Vendor: 
  

	 	(a)	on Closing, a certified cheque or bank draft to or to the order of the Vendor or by wire transfer in accordance with instructions received from the Vendor in the amount of [**]
Dollars ($[**]); and 

  

	 	(b)	subject to section 2.6, simultaneously with the delivery by the Purchaser of each Earn-Out Statement as provided in section 2.5, a certified cheque to or to the order of the Vendor
in the amount set forth in such Earn-Out Statement as being payable on account of the Earn-Out Amount. 

  
 All payments on account of the Purchase Price shall be accompanied by the payment of applicable goods and services taxes thereon on the portion of the
Purchase Price on which such taxes are payable, and the Vendor shall remit such taxes to the applicable governmental authority on a timely basis. 
  

	2.5	Calculation of Earn-Out Amount. 

  
 Within thirty (30) days following the end of every second fiscal quarter of the Purchaser ending after the Closing Date until and including the second
fiscal quarter of the Purchaser ending after the third anniversary of the Closing Date, the Purchaser shall prepare and deliver to the Vendor a statement (the “Earn-Out Statement”), certified by the Chief Financial Officer of the
Purchaser, setting out in reasonable detail, a calculation of the Earn-Out Amount for the two fiscal quarters (or portion thereof if the period in respect of which the Earn-Out Amount is to be calculated is not two complete fiscal quarters)
immediately preceding the date of the Earn-Out Statement. During and within six months after the end of each fiscal year of the Purchaser, the Vendor shall have the right, through independent certified public accountants designated by the Vendor, to
examine and audit, during normal business hours, all records and accounts of the Purchaser which contain information bearing upon the calculation of the Earn-Out 

  

 - 6 - 

 
Amount for each of the relevant fiscal quarters of that fiscal year. Such examinations and audits shall be completed at the Vendor’s expense, unless a
discrepancy or error representing an underpayment exceeding 2% of the amount actually due is found in conjunction with such examination and audit, in which case, all costs of such examination and audit shall be borne by the Purchaser. To the extent
that the examination and audit, whether by the Purchaser’s auditors or on behalf of the Vendor, reveals an underpayment of the Earned-Out Amount, such underpayment shall be paid to the Vendor within 10 days of the date of the determination of
such underpayment. 
  

	2.6	Escrow and Set-Off 

  
 If the Purchaser, acting in good faith, makes a bona fide claim for indemnification pursuant to section 8.4 at least five Business Days prior to
the date on which any amounts on account of the Earn-Out Amount are payable to the Vendor, the Purchaser shall have the right to pay to Gowling Lafleur Henderson LLP, in escrow, pursuant to the Escrow Agreement, any such amounts up to the amount so
claimed (the amounts so paid to such escrow agent being collectively described as the “Escrowed Amount”), which shall remain in escrow until the final determination or settlement of such claim, and shall be available to satisfy the amount,
if any, determined or agreed to be owing to the Purchaser in connection therewith. The balance of the Escrowed Amount shall be paid to the Vendor. Any interest earned on the Escrowed Amount shall be allocated and paid to the Purchaser and Vendor in
accordance with the same percentages in which the Escrowed Amount is paid. None of the Purchaser’s rights under this section 2.6 shall limit any of the Purchaser’s other rights or remedies whatsoever. 
  

	2.7	Transfer Taxes. 

  
 The Purchaser shall be liable for and pay directly to the appropriate taxing authority or other entity, within the required time period, all federal and
provincial or state sales taxes and all other similar taxes, duties, registration charges or other like charges (but excluding any taxes based upon the income, revenues or capital receipts of the Vendor) properly payable in connection with the
transfer of the Purchased Assets, including any Inventories. 
  
 ARTICLE 3 – ASSUMPTION OF OBLIGATIONS 
  

	3.1	Assumption by the Purchaser. 

  
 The Purchaser shall assume the Assumed Obligations as of the close of business on the Closing Date and shall pay, discharge and perform the Assumed
Obligations, as the case may be, from and after the close of business on the Closing Date. The Purchaser shall not be liable for or assume any obligations of the Vendor other than the Assumed Obligations, including any Accounts Payable. Once the
Closing has occurred, the Purchaser shall be deemed to have assumed the Assumed Obligations and no further agreement is required to evidence that fact. 
  

 - 7 - 

 ARTICLE 4 – REPRESENTATIONS AND WARRANTIES OF THE VENDOR 
  

	4.1	Representations and Warranties. 

  
 The Vendor hereby makes the following representations and warranties and acknowledges that the Purchaser is relying on such representations and warranties
in entering into this Agreement and in purchasing the Purchased Assets from the Vendor: 
  

	 	(a)	Corporate. The Vendor is a corporation duly incorporated under the federal laws of Canada and has not been discontinued or dissolved. The Vendor has the requisite corporate
power and authority to own or lease its property and to carry on the Purchased Business and to sell the Purchased Assets to the Purchaser and otherwise perform its obligations pursuant to this Agreement. The Vendor has made all filings and
registrations under all applicable laws and is duly qualified as a corporation to carry on business, and is in good standing, in each jurisdiction in which the nature of the Purchased Business, or the property owned or leased by the Vendor, makes
such qualification necessary. Schedule 4.1(a) contains a complete list of the jurisdictions in which the Purchased Business is carried on by the Vendor. 

  

	 	(b)	Authorization of Agreement. This Agreement has been duly authorized, executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor,
enforceable against it in accordance with its terms. 

  

	 	(c)	Title to Purchased Assets. The Vendor is the sole legal and beneficial owner of the Purchased Assets and has good marketable title thereto. For greater certainty, the
Purchased Assets include rights relating to Intellectual Property that are licensed and not owned by the Vendor, and are fully described in section 4.1(f). The owned Purchased Assets shall, on the Closing, be free and clear of all Encumbrances.

  

	 	(d)	Rights to Acquire Purchased Assets. Except pursuant to this Agreement, no Person has any agreement, option, understanding, commitment or right or any right or privilege
capable of becoming a right to purchase any of the Purchased Assets from the Vendor other than agreements entered into by the Vendor in respect of any Inventories in the ordinary course of business. 

  

	 	(e)	Contracts. Schedule 4.1(e) contains a complete and accurate list of all the Contracts. Each of the Contracts constitutes valid and binding obligations of the parties
thereto, enforceable in accordance with its terms. The Vendor is not, nor, to the knowledge of the Vendor, are any of the other parties to any of the Contracts, in breach, in any material respect, of its obligations thereunder and no act or event
has occurred which with notice or lapse of time, or both, would constitute a breach of any of the Contracts. All of the Contracts were entered into in the ordinary course of business, are now in full force and effect and unamended and the Vendor is
entitled to all benefits, rights and privileges thereunder. Neither the Vendor nor its counsel has received notice that any subscriber, supplier or other Person has breached, intends to breach or intends to discontinue any Contract.

  

 - 8 - 

	 	(f)	Intellectual Property. 

  

	 	(i)	Schedule 1.1(f) lists all Intellectual Property relating exclusively to the Purchased Business, including particulars of any registration thereof, details of all applications
for registration in respect thereof and, where unregistered, the date of first use thereof; and 

  

	 	(ii)	The Intellectual Property includes all proprietary rights, trade processes and secrets necessary for the conduct of, or that are used in the Purchased Business as it is currently
conducted. 

  

	 	(g)	Location of Assets. All tangible Purchased Assets are, and will remain, throughout the period up to and including the Closing Date, situate at Kanata, Ontario, Carson,
California, Ogdensberg, New York and in various locations in Hong Kong and China. 

  

	 	(h)	Equipment. All of the Equipment is in good working order, having regard to its age and subject to reasonable wear and tear. 

  

	 	(i)	Inventories. Except for potential latent defects relating to the pendants described in sections 8.4(a)(vi) and 8.4(a)(vii), the Inventories are, to the knowledge of the
Vendor, in good condition, are of merchantable quality and quantity usable or saleable in the ordinary course of business and are fit for the purposes for which they are intended. The Inventories are labelled and stored in compliance with all
applicable federal, provincial, state and local laws, ordinances, governmental rules and regulations. 

  

	 	(j)	Books and Records. The Records are duly maintained in accordance with all applicable legal requirements and contain full and accurate records of all matters required to be
dealt with in such records. All material financial transactions and financial information relating to the period commencing May 1, 2001 to the date hereof and exclusively and directly to the Purchased Business and the Purchased Assets have been
accurately recorded in the Records in accordance with normal and customary procedures for a similar business. No indirect costing information is included in the Records. Without limiting the generality of the foregoing, all information regarding
subscribers and revenues relating to the Contracts and the Purchased Business for such time period is contained in the Records and is complete and accurate so as to provide the Purchaser with a reasonable opportunity to assess the Purchased
Business. 

  

	 	(k)	Taxes. All federal and provincial sales taxes and other similar taxes applicable to the Purchased Business or to the Purchased Assets (other than on the transfer thereof to
the Purchaser) with respect to all periods prior to the Time of Closing will have been paid and satisfied prior to the Time of Closing, or, if unpaid, shall not attach to any of the Purchased Assets whatsoever or become an obligation of the
Purchaser, it being acknowledged that the Purchaser is acquiring the Purchased Assets free and clear of all Encumbrances. 

  

 - 9 - 

	 	(l)	Non-Resident. The Vendor is not a non-resident of Canada for the purposes of the Income Tax Act (Canada). 

  

	 	(m)	GST. The Vendor has not been and is not now a financial institution for the purposes of the Excise Tax Act (Canada). The Vendor is a registrant for the purposes of the
Excise Tax Act (Canada), registration number 100237916 RT0001. 

  

	 	(n)	Validity of Transactions. The execution and delivery of this Agreement by the Vendor, the consummation of the transactions contemplated hereby and the fulfilment by the
Vendor of the terms, conditions and provisions hereof will not: 

  

	 	(i)	contravene or violate or result in the breach (with or without the giving of notice or lapse of time, or both) or acceleration of any obligations of the Vendor under:

  

	 	(A)	any laws applicable to the Vendor; 

  

	 	(B)	any judgment, order, writ, injunction or decree of any court or of any governmental official, agency or instrumentality which is presently applicable to the Vendor,

  

	 	(C)	the articles, by-laws or any resolutions of the Vendor or any amendments thereto or restatements thereof, or 

  

	 	(D)	subject to obtaining any requisite consents or approvals, the provisions of any agreement, arrangement or understanding to which the Vendor is a party or by which it is bound;

  

	 	(ii)	relieve any other party to a Contract of its obligations thereunder or enable it to determine its obligations thereunder; or 

  

	 	(iii)	result in the creation or imposition of any Encumbrance on any of the Purchased Assets. 

  

	 	(o)	Compliance with Laws. The Vendor has conducted the Purchased Business in compliance, in all material respects, with all applicable laws. The Vendor is duly licensed,
registered or qualified and duly possesses all material licenses, permits, quotas and approvals (the “Licenses”) to enable the Purchased Business to be carried on as now conducted in compliance with all applicable laws. The Licenses
are described in Schedule 4.1(o). The Licenses are valid and subsisting and in good standing and there has been no material violation in respect thereof. There are no limitations or restrictions on carrying on the Purchased Business from the
premises from which it is now carried on. 

  

	 	(p)	 Litigation. Except as disclosed in Schedule 4.1(p), there is no suit, action, dispute, civil or criminal litigation, claim, arbitration or legal,
administrative or other proceeding or governmental investigation, including appeals and applications for review (collectively, “Claims”), pending or, to the best of the 

  

 - 10 - 

	 	 
Vendor’s knowledge, threatened against the Vendor or relating to the Purchased Business or any of the Purchased Assets. To the knowledge of the Vendor,
there are no facts which are likely to give rise to any such Claims. There is not presently outstanding against the Vendor any judgment, execution, order, injunction, decree or rule of any court, administrative agency, governmental authority or
arbitrator which affects the Purchased Assets or the Purchased Business. 

  

	 	(q)	Brokers. Except for Focus Enterprises Inc., the fees and expenses of whom shall be borne solely by the Vendor, the Vendor has not engaged any broker or other agent in
connection with the transactions contemplated in this Agreement and, accordingly, there is no commission, fee or other remuneration payable to any other broker or agent who purports or may purport to have acted for the Vendor.

  

	 	(r)	Equipment List. The equipment list set out in Schedule 1.1(m) is complete and contains all of the equipment used exclusively in the Purchased Business.

  

	 	(s)	Truth and Accuracy of Schedules. All of the information disclosed in each of the Schedules attached to this Agreement is true and correct as of the date hereof.

  

	 	(t)	Disclosure. True and complete copies of all agreements, instruments and documents referred to in this Agreement, including all Schedules hereto, have been provided to the
Purchaser. 

  
 ARTICLE 5 – REPRESENTATIONS
AND WARRANTIES OF THE PURCHASER 
  

	5.1	Representations and Warranties. 

  
 The Purchaser hereby makes the following representations and warranties and acknowledges that the Vendor is relying on such representations and warranties
in entering into this Agreement and in selling the Purchased Business and the Purchased Assets to the Purchaser: 
  

	 	(a)	Corporate. The Purchaser is a corporation duly incorporated under the laws of the State of Massachusetts and has not been dissolved. 

  

	 	(b)	Authorization of Agreement. This Agreement has been duly authorized, executed and delivered by the Purchaser and constitutes a valid and binding obligation of the Purchaser,
enforceable against it in accordance with its terms. 

  

	 	(c)	Validity of Transactions. Neither the execution and delivery of this Agreement by the Purchaser, the consummation of the transactions contemplated hereby nor the fulfilment
by the Purchaser of the terms, conditions and provisions hereof will contravene or violate or result in the breach (with or without the giving notice or lapse of time, or both) or acceleration of any obligations of the Purchaser under:

  

	 	(i)	any laws applicable to the Purchaser, 

  

 - 11 - 

	 	(ii)	any judgment, order, writ, injunction or decree of any court or of any governmental official, agency or instrumentality which is presently applicable to the Purchaser,

  

	 	(iii)	the articles or by-laws of the Purchaser or any amendments thereto or restatements thereof, or 

  

	 	(iv)	the provisions of any agreement, arrangement or understanding to which the Purchaser is a party or by which it is bound. 

  

	 	(d)	Brokers. The Purchaser has not engaged any broker or other agent in connection with the transactions contemplated in this Agreement and, accordingly, there is no commission,
fee or other remuneration payable to any broker or agent who purports or may purport to have acted for the Purchaser. 

  
 ARTICLE 6 – COVENANTS OF THE VENDOR 
  

	6.1	Disclosure of Transaction. 

  

	 	(a)	The Vendor shall not, and shall use its best efforts to ensure that its agents, employees, officers and directors do not, without the prior written consent of the Purchaser,
disclose or permit to be disclosed to anyone any information relating to the Purchaser, this Agreement and the transactions contemplated in this Agreement. This section does not prohibit disclosure to the professional advisors, bankers and employees
of the Vendor who need to know such information, or to the extent necessary to authorize the purchase and sale of the Purchased Assets pursuant to this Agreement, or as may be required by law. 

  

	 	(b)	Notwithstanding section 13.10, the Vendor shall continue to be bound, until Closing, by all existing confidentiality agreements between the Vendor and the Purchaser, including the
non-disclosure agreement dated October 8, 2002. 

  

	6.2	Examinations and Investigations. 

  
 The Vendor shall, upon reasonable notice and during normal business hours, until the Time of Closing make available to the Purchaser and its
representatives for examination all Records and other documents relating to the Purchased Business in the Vendor’s possession or under its control. The Vendor shall provide copies of the foregoing when reasonably requested by the Purchaser. The
Vendor shall, upon reasonable notice and during normal business hours, until the Time of Closing give the Purchaser and its representatives access to the Purchased Assets and the Purchased Business in order to make such investigations as they shall
deem necessary or advisable, and shall cause a senior employee of the Purchased Business to be available to the Purchaser at the Vendor’s premises to aid in the examinations and investigations by the Purchaser and its representatives upon
reasonable notice and during normal business hours until the Time of Closing, including answering any questions that they may have concerning the Purchased Business or its employees and to provide material or information regarding any of them. The
exercise of any rights of access, inspection or examination by or on behalf of the Purchaser or its representatives shall not affect or mitigate the Vendor’s covenants, representations and warranties in this Agreement. 
  

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	6.3	Conduct of Business Prior to Closing. 

  
 Except as otherwise contemplated or permitted by this Agreement or the planned termination of employees of the Purchased Business without disruption to
its operations, during the period from the date of this Agreement to the Time of Closing: 
  

	 	(a)	the Vendor shall promote the interests and maintain the goodwill of the Purchased Business and continue to operate the Purchased Business in the ordinary course consistent with past
practice, including paying and satisfying all obligations with respect to the Purchased Business as such obligations mature; 

  

	 	(b)	the Vendor shall not, without the prior written consent of the Purchaser, perform or make any material act or decision or enter into any contract, commitment or transaction not in
the ordinary course of business or which could have a material adverse effect on the Purchased Business or which would constitute a breach of any of the covenants, representations or warranties of the Vendor contained in this Agreement or which
would cause any of such covenants, representations and warranties not to be true at the Time of Closing, including: 

  

	 	(i)	entering into commitments acquiring or initiating new businesses or undertakings or assuming any material commitment or obligation (by written or agreement or otherwise) or selling,
encumbering or otherwise disposing or distributing any material asset, in any such case in connection solely with the Purchased Business, except in the ordinary course of business consistent with past practice; for purposes hereof, a commitment,
obligation or asset will be deemed to be material if, among other things, it alone has a value in excess of Fifty Thousand Dollars ($50,000) or all such commitments, obligations and assets have a value of more than One Hundred Thousand Dollars
($100,000) in the aggregate; 

  

	 	(ii)	entering into any employment, labour, consulting or service contracts relating solely to the Purchased Business except in the ordinary course of business consistent with past
practices; 

  

	 	(iii)	terminating any employment agreements or giving notice of termination respecting employees exclusively employed in the Purchased Business except in the ordinary course of business
consistent with past practices; 

  

	 	(iv)	initiating or settling any litigation to which the Vendor may be or may become a party and which relates solely to the Purchased Business; 

  

	 	(v)	entering into any transaction, understanding or arrangement with any Persons with whom the Vendor is not dealing at arm’s length (as that term is construed for the purposes of
the Income Tax Act (Canada)) solely in connection with the Purchased Business, except in the ordinary course of business, consistent with past practices; or 

  

	 	(vi)	 amending, revising, renewing or terminating any lease, licence, registered user or other material agreement to which the Vendor may be a party or 

  

 - 13 - 

	 	 
which may materially affect only the Purchased Business or the Purchased Assets or any trade name, business name, trademark, proposed trademark,
certification mark, distinguishing guise, industrial design, copyright or patent, whether domestic or foreign an whether registered or unregistered, relating solely to the Purchased Business or the Purchased Assets, except in the ordinary course of
business, consistent with past practices. 

  

	 	(c)	the Vendor shall give notice to the Purchaser of any potential defaults or breaches of representations, warranties or covenants of the Vendor or any other material matter which may
adversely affect only the Purchased Assets or the Purchased Business forthwith upon becoming aware of such matters; and 

  

	 	(d)	the Vendor shall continue to maintain in full force and effect all policies of insurance currently in effect in respect of the Purchased Assets and the Purchased Business and give
all notices and present all claims under all policies of insurance in a due and timely fashion. 

  

	6.4	Consents and Approvals. 

  
 The Vendor shall ensure that as of the Time of Closing, the actions, consents and approvals listed in Schedule 6.4(1) have been taken and obtained.
The terms of the Assignment of Contracts Agreement attached as Schedule 6.4(2) shall govern with respect to Contracts and Leases if the Purchaser completes the transaction contemplated hereby on the Closing Date notwithstanding that any of
the actions, consents or approvals required to assign such Contracts and Leases to the Purchaser have not been taken or obtained and completion of the transaction contemplated hereby shall relieve the Vendor of and from any failure to take or obtain
such actions, consents or approvals. 
  

	6.5	Representations, Warranties and Conditions. 

  
 The Vendor shall use commercially reasonable endeavours to ensure that the representations and warranties set forth in Article 4 are true and correct at
the Time of Closing as if such representations and warranties were made at and as of such time and that the conditions of closing for the benefit of the Purchaser set forth in Article 9 have been fulfilled, performed or satisfied by the Time of
Closing to the extent that the fulfilment, performance or satisfaction of such conditions is within the Vendor’s reasonable control. 
  

	6.6	Non-Competition and Non-Solicitation Agreement. 

  
 The Vendor shall on or prior to the Time of Closing execute the Non-Competition and Non-Solicitation Agreement in substantially the form attached as
Schedule 6.6. 
  

	6.7	Referral of Communications. 

  
 The Vendor shall forthwith redirect to the Purchaser any fax communications and other inquiries received by the Vendor from time to time following the
Closing which relate exclusively to the Purchased Business. This section 6.7 shall survive the Closing, indefinitely. 
  

 - 14 - 

	6.8	Technical Support. 

  
 In order to effectively transition the servicing of customers of the Purchased Business to the Purchaser, the Vendor shall, as and to the extent requested
by the Purchaser for the ninety (90) day period following the Closing Date, provide, on a sub-contract basis, the technical support for the products provided for in the service contracts included in the Contracts, and in furtherance thereof, the
Vendor and the Purchaser shall enter into the Telephone Customer Support Services Agreement in substantially the form attached as Schedule 6.8. The Purchaser shall pay the Vendor a fee for such services on a monthly basis, in arrears, on the
basis of the Vendor’s standard rates for such services. 
  

	6.9	Escrow Agreement 

  
 The Vendor and Gowlings LLP shall on or prior to the Time of Closing execute the Escrow Agreement in substantially the form attached as Schedule
6.9. 
  
 ARTICLE 7 – COVENANTS OF THE PURCHASER

  

	7.1	Disclosure of Transaction. 

  

	 	(a)	The Purchaser shall not, and shall use its best efforts to ensure that its agents, employees, officers and directors do not, without the prior written consent of the Vendor,
disclose or permit to be disclosed to anyone any information relating to the Vendor, this Agreement and the transactions contemplated in this Agreement. This section does not prohibit disclosure to the professional advisors, bankers and employees of
the Purchaser who need to know such information, or to the extent necessary to authorize the purchase and sale of the Purchased Assets pursuant to this Agreement, or as may be required by law. 

  

	 	(b)	Notwithstanding section 13.10, the Purchaser shall continue to be bound, until Closing, by all existing confidentiality agreements between the Purchaser and the Vendor, including
the term sheet dated May 2, 2003. 

  

	7.2	Representations, Warranties and Conditions. 

  
 The Purchaser shall use its reasonable best efforts to ensure that the representations and warranties forth in Article 5 are true and correct at the Time
of Closing as if such representations and warranties were made at and as of such time and that the conditions of closing for the benefit of the Vendor set forth in Article 10 have been fulfilled, performed or satisfied by the Time of Closing to the
extent that the fulfilment, performance or satisfaction of such conditions is within the Purchaser’s reasonable control. 
  

	7.3	Informing Persons Dealing with Purchased Business. 

  
 The Purchaser shall take reasonable steps following the Closing to inform all relevant Persons having dealings with the Purchased Business that the
Purchaser has acquired the Purchased Business and that all communications regarding the Purchased Business should, following the Closing, be directly with the Purchaser. 
  

 - 15 - 

 ARTICLE 8 – SURVIVAL AND INDEMNIFICATION 
  

	8.1	Survival of Vendor’s Representations and Warranties. 

  
 The representations and warranties of the Vendor contained in this Agreement or any document or certificate given pursuant to this Agreement shall survive
the Closing for the benefit of the Purchaser as follows: 
  

	 	(a)	as to the representations and warranties contained in sections 4.1(c) and 4.1(d), indefinitely; 

  

	 	(b)	as to tax matters, until the date following expiration of all periods allowed for objecting and appealing the determination of any proceedings relating to any assessment or
reassessment of the Purchaser or the Vendor, as the case may be, by any taxing authority in respect of any taxation period ending prior to the Closing or in which the Closing occurs unless a bona fide notice of a claim shall have been made in
writing before the expiry of that period, in which case the representation and warranty to which such notice applies shall survive in respect of that claim until the final determination or settlement of that claim; and 

  

	 	(c)	as to all other matters, for a period of three (3) years, unless a bona fide notice of a claim shall have been given in writing before the expiry of that period, in which
case the representation and warranty to which such notice applies shall survive in respect of that claim until the final determination or settlement of that claim. 

  

	8.2	Survival of Purchaser’s Representations and Warranties. 

  
 The representations and warranties of the Purchaser contained in this Agreement or any document or certificate given pursuant to this Agreement shall
survive the Closing for the benefit of the Vendor for a period of three (3) years, unless a bona fide notice of a claim shall have been given in writing before the expiry of that period, in which case the representation and warranty to which
such notice applies shall survive in respect of that claim until the final determination or settlement of that claim. 
  

	8.3	Survival of Covenants. 

  
 Except as otherwise provided in this Agreement, all covenants of the Vendor and the Purchaser, as the case may be, contained in this Agreement, including
those set forth in section 8.4(a)(vi) or section 8.4(a)(vii), or any document or certificate given pursuant to this Agreement shall survive the Closing for the benefit of the Purchaser or the Vendor, as the case may be, indefinitely. 
  

	8.4	Indemnification. 

  

	 	(a)	The Vendor shall indemnify and hold the Purchaser harmless from and against any claim, demand, action, cause of action, damage, loss (including lost profits), cost, liability or
expense (including reasonable legal fees) (collectively, “Losses”) which may be made or brought against the Purchaser or which the Purchaser may suffer or incur in respect of, as a result of, or arising out of:

  

	 	(i)	any non-fulfillment of any covenant on the part of the Vendor contained in this Agreement (other than as set out in section 8.4(a)(vii)) or any document or certificate given
pursuant to this Agreement; 

  

 - 16 - 

	 	(ii)	any inaccuracy in or breach of any of the Vendor’s representations or warranties contained in this Agreement or any document or certificate given pursuant to this Agreement;

  

	 	(iii)	any federal, provincial or state taxes related to the operation of Purchased Business prior to the Time of Closing which the Purchaser is required to pay; 

 

	 	(iv)	any liabilities of the Vendor, including Accounts Payable, which are not included in the Assumed Obligations, other than as expressly set forth in sections 8.4(a)(vi) and
8.4(a)(vii); 

  

	 	(v)	any of the litigation matters described in Schedule 4.1(p); 

  

	 	(vi)	any MHZ pendants or bracelets (series 173, revision 1) which were sold in the operation of the Purchased Business prior to Closing; 

  

	 	(vii)	any MHZ pendants or bracelets (series 173, revision 2) which were or are sold in the operation of the Purchased Business either prior to or following the Closing, to the extent that
there is a malfunction or failure to perform in accordance with its specifications and such malfunction is attributable to the design of such pendant or bracelet as at the Closing Date, when used in accordance with the written instructions provided
to end users by either or both of the manufacturer or the Vendor and under conditions recommended to end users, in writing, by either or both of the manufacturer or the Vendor; and 

  

	 	(viii)	the failure of the parties to this transaction to comply with the Bulk Sales Act (Ontario) or similar legislation in any other applicable jurisdiction.

  

	 	(b)	The Purchaser shall indemnify and hold the Vendor harmless from and against any Losses which may be made or brought against the Vendor or which the Vendor may suffer or incur, in
respect of, as a result of or arising out of: 

  

	 	(i)	any non-fulfillment of any covenant on the part of the Purchaser contained in this Agreement or any document or certificate given pursuant to this Agreement; and

  

	 	(ii)	any inaccuracy in or breach of any of the Purchaser’s representations or warranties contained in this Agreement or any document or certificate given pursuant to this Agreement.

  

 - 17 - 

	8.5	Procedure for Indemnification. 

  

	 	(a)	Claims Other Than Third Party Claims. Following receipt from the Vendor or the Purchaser, as the case may be (the “Indemnified Party”), of a written notice
of a claim for indemnification which has not arisen in respect of a Third Party Claim (as defined in section 8.5(b) below), the party who is in receipt of such notice (the “Indemnifying Party”) shall have 30 days to make such
investigation of the claim as the Indemnifying Party considers necessary or desirable. For the purpose of such investigation, the Indemnified Party shall make available to the Indemnifying Party the information available to the Indemnified Party or
in its possession relating to the claim. If the Indemnified Party and the Indemnifying Party agree at or prior to the expiration of such 30 day period (or any mutually agreed upon extension thereof) to the validity and amount of the claim, the
Indemnifying Party shall immediately pay to the Indemnified Party the full agreed upon amount of the claim. If the Indemnified Party and the Indemnifying Party do not agree within such period (or any mutually agreed upon extension thereof), such
dispute shall be resolved by arbitration as set out in section 13.2. 

  

	 	(b)	Third Party Claims. The Indemnified Party shall notify the Indemnifying Party in writing as soon as is reasonably practicable after being informed that facts exist which may
result in a claim originating from a Person other than the Indemnified Party (a “Third Party Claim”) and in respect of which a right of indemnification given pursuant to section 8.4 may apply. The Indemnifying Party shall have the
right to elect, by written notice delivered to the Indemnified Party within 10 days following receipt by the Indemnifying Party of the notice from the Indemnified Party in respect of the Third Party Claim, at the sole expense of the Indemnifying
Party, to participate in or assume control of the negotiation, settlement or defence of the Third Party Claim, provided that: 

  

	 	(i)	such will be done at all times in a diligent and bona fide matter; 

  

	 	(ii)	the Indemnifying Party acknowledges in writing its obligation to indemnify the Indemnified Party in accordance with the terms contained in this Agreement in respect of that Third
Party Claim; and 

  

	 	(iii)	the Indemnifying Party shall pay all reasonable out-of-pocket expenses incurred by the Indemnified Party as a result of such participation or assumption. 

 
 If the Indemnifying Party elects to assume such control, the Indemnified
Party shall cooperate with the Indemnifying Party and its counsel and shall have the right to participate in the negotiation, settlement or defence of such Third Party Claim at its own expense. If the Indemnifying Party does not so elect or, having
elected to assume such control, thereafter fails to proceed with the settlement or defence of any such Third Party Claim, the Indemnified Party shall be entitled to assume such control. In such case, the Indemnifying Party shall cooperate where
necessary with the Indemnified Party and its counsel in connection with such Third Party Claim and the Indemnifying Party shall be bound by the results obtained by the Indemnified Party with respect to such Third Party Claim. 
  

 - 18 - 

	8.6	Additional Rules and Procedures. 

  
 The obligation of the parties to indemnify each other pursuant to this Article 8 shall also be subject to the following: 
  

	 	(a)	an Indemnified Party shall only be entitled to make a claim for indemnification pursuant to section 8.4(a)(i) or (ii), or 8.4(b)(i) or (ii), as the case be, if written notice
containing reasonable particulars of such claim is delivered to the Indemnifying Party within the time periods provided for in section 8.1, 8.2 or 8.3, as the case may be, and the Purchaser shall only be entitled to make a claim for indemnification
pursuant to section 8.4(a)(vii) if written notice containing reasonable particulars of such claim is delivered to the Vendor prior to the third anniversary of the Closing Date; 

  

	 	(b)	if any Third Party Claim is of a nature such that the Indemnified Party is required by applicable law to make a payment to any Person (a “Third Party”) with respect
to such Third Party Claim before the completion of settlement negotiations or related legal proceedings, the Indemnified Party may make such payment and the Indemnifying Party shall, forthwith after demand by the Indemnified Party, reimburse the
Indemnified Party for any such payment. If the amount of any liability under the Third Party Claim in respect of which such a payment was made, as finally determined, is less than the amount which was paid by the Indemnifying Party to the
Indemnified Party, the Indemnified Party shall, forthwith after receipt of the difference from the Third Party, pay such difference to the Indemnifying Party; 

  

	 	(c)	except in the circumstances contemplated by section 8.6(b), and whether or not the Indemnifying Party assumes control of the negotiation, settlement or defence of any Third Party
Claim, the Indemnified Party shall not settle or compromise any Third Party Claim except with the prior written consent of the Indemnifying Party (which consent shall not be unreasonably withheld). A failure by the Indemnifying Party to respond in
writing to a written request by the Indemnified Party for consent for a period of twenty (20) days or more, shall be deemed a consent by the Indemnifying Party to such request; 

  

	 	(d)	the Indemnifying Party and the Indemnified Party shall provide each other on an ongoing basis with all information which may be relevant to the other’s liability hereunder and
shall supply copies of all relevant documentation promptly as they become available; 

  

	 	(e)	notwithstanding section 8.6(c), the Indemnifying Party shall not settle any Third Party Claim or conduct any related legal or administrative proceeding in a manner which would, in
the opinion of the Indemnified Party, acting reasonably, have a material adverse impact on the Indemnified Party; 

  

	 	(f)	no Indemnifying Party shall be liable for any indirect or consequential loss or damages unless and to the extent that they are claimed by a third party pursuant to a Third Party
Claim; 

  

 - 19 - 

	 	(g)	no Indemnifying Party shall be liable to the Indemnified Party pursuant to sections 8.4(a)(i) and/or 8.4(a)(ii) until the aggregate of the Losses which the Indemnified Party is
entitled to recover thereunder exceeds Fifty Thousand Dollars ($50,000), after which time claims for indemnification by the Indemnifying Party may be made back to dollar one. Notwithstanding anything else set out or referred to in this Agreement or
otherwise, in no event shall the Vendor be liable to the Purchaser under this Agreement, in the aggregate, for any amount in excess of the total of all payments actually received by the Vendor on account of the Purchase Price, and with respect to
section 8.4(a)(vii) only, for any amount in excess of Seven Hundred and Fifty Thousand Dollars ($750,000); 

  

	 	(h)	the Indemnified Party shall use reasonable commercial efforts to mitigate any Losses giving rise to a claim for indemnification pursuant to this Article 8; and

  

	 	(i)	where an amount is payable by the Indemnifying Party as indemnification pursuant to the terms of this Agreement and the Excise Tax Act (Canada) provides that GST is deemed to
have been collected by the payee thereof, the amount so payable as determined without reference to this Article 8 (the “Indemnification Amount”) shall be increased by an amount equal to the rate of GST applied to the Indemnification
Amount in accordance with the Excise Tax Act (Canada). 

  

	8.7	Rights Cumulative. 

  
 The rights of indemnification contained in this Article 8 are cumulative and, except as provided for in section 8.6(f), are in addition to every other
right or remedy of the parties contained in this Agreement or otherwise. 
  
 ARTICLE 9 – CONDITIONS OF CLOSING IN FAVOUR OF THE PURCHASER 
  

	9.1	Conditions of Closing. 

  
 The obligation of the Purchaser to purchase the Purchased Assets is subject to the fulfillment, performance and satisfaction of each of the conditions set
forth below. The Vendor acknowledges that the following conditions are for the exclusive benefit of the Purchaser. 
  

	 	(a)	Representations and Warranties. All representations and warranties of the Vendor made in or pursuant to this Agreement shall be true and correct at the Time of Closing in all
material respects with the same force and effect as if made at and as of such time and date, and the Vendor shall have delivered to the Purchaser at the Time of Closing a certificate dated the Closing Date, duly executed by an officer of the Vendor
acceptable to the Purchaser, to such effect. The receipt of such certificate and the closing of the transaction of purchase and sale provided for in this Agreement shall not be nor be deemed to be a waiver of the representations and warranties
contained in this Agreement, which representations and warranties shall continue in full force and effect for the benefit of the Purchaser as provided in Article 8. 

  

	 	(b)	 Performance of Covenants. The Vendor shall have performed or complied with, in all material respects, all of the obligations, covenants and agreements in
this 

  

 - 20 - 

	 	 
Agreement which are to be performed or complied with by the Vendor at or prior to the Time of Closing. The Vendor shall not be in breach in any material
respect of any covenant contained in this Agreement and shall have delivered to the Purchaser at the Time of Closing a certificate, duly executed by an officer of the Vendor acceptable to the Purchaser, to such effect. 

 

	 	(c)	Consents and Approvals. All actions, approvals and consents listed on Schedule 6.4(1) and the consents or authorizations of any other Persons that are, in the
reasonable opinion of the Purchaser, required to be obtained in connection with the completion of the transactions contemplated by this Agreement, the execution of this Agreement, the Closing or the performance of any of the terms and conditions
hereof (other than any which are the responsibility, under applicable law, of the Purchaser to obtain), shall have been obtained by the Vendor at or prior to the Time of Closing on terms and conditions acceptable to the Purchaser, acting reasonably.
Such consents, in the case of a Contract, shall include an acknowledgement by the parties to such Contract as to the good standing of such Contract. 

  

	 	(d)	No Action to Restrain. No action or proceeding shall be pending or threatened by any governmental or regulatory agency or authority or any other Person (including a party
hereto) to restrain or prohibit the completion of the transaction contemplated by this Agreement or to prevent or restrain the Purchaser from carrying on the Purchased Business as presently carried on. 

  

	 	(e)	Corporate Approval. Prior to the execution of this Agreement, all necessary corporate actions and authorizations shall have been taken or obtained, as the case may be, by the
Purchaser and its directors, officers, and shareholders in connection with the purchase of the Purchased Assets and the transaction contemplated hereunder. 

  

	 	(f)	Opinion of Counsel to the Vendor. The Purchaser shall have received an opinion dated the Closing Date from counsel to the Vendor in the form attached as Schedule
9.1(f). 

  

	 	(g)	Retail Sales Tax. The Vendor shall have provided evidence that no tax is payable under the Retail Sales Tax Act (Ontario). If, in the alternative, retail sales tax is
payable in connection with the operation of the Purchased Business, the Vendor shall have obtained at its expense and shall have delivered to the Purchaser a certificate pursuant to section 6 of the Retail Sales Tax Act (Ontario) stating that
all taxes required to be paid by the Vendor in respect of the Purchased Business under the Retail Sales Tax Act (Ontario) have been paid. 

  

	 	(h)	No Material Adverse Change. Except as has been specified in this Agreement or otherwise disclosed to the Purchaser in writing or the planned termination of employees of the
Purchased Business without disruption to its operations, since the date of this Agreement there shall not have been: 

  

	 	(i)	any material change in the condition or operation of the Purchased Business or the Purchased Assets other than changes in the ordinary and normal course of Purchased Business
consistent with past practice, none of which has been materially adverse; or 

  

 - 21 - 

	 	(ii)	any damage, destruction or loss, labour disruption or other event, development or condition of any character (whether or not covered by insurance) materially and adversely affecting
the Purchased Business, the Purchased Assets or the future prospects of the Purchased Business. 

  

	 	(i)	Closing Documents and Proceedings. All documentation relating to the purchase and sale of the Purchased Assets and the due authorization of the performance by the Vendor of
its obligations under this Agreement shall have been approved by the Purchaser and its counsel, acting reasonably, and the Purchaser shall have received copies of all such documentation or other evidence as it may reasonably request.

  

	 	(j)	[**] Corporation shall have entered into a license of certain software in favour of the Purchaser, on terms and conditions satisfactory to the Purchaser, acting reasonably.

  

	 	(k)	[**] Corporation shall have entered into a manufacturing agreement in favour of the Purchaser, on terms and conditions satisfactory to the Purchaser, acting reasonably.

  

	9.2	Waiver. 

  
 If any of the conditions set forth in this Article 9 have not been fulfilled, performed and satisfied at or prior to the Closing, the Purchaser may, by
written notice to the Vendor, terminate all of its obligations hereunder and each of the Purchaser and the Vendor shall be released from all its obligations under this Agreement except that the provisions of the non-disclosure agreement between the
Vendor and the Purchaser dated October 8, 2002 shall continue in full force and effect as provided for therein. Any of these conditions may be waived in whole or in part by the Purchaser by instrument in writing, without prejudice to any of its
rights of termination in the event of non-performance of any other condition, obligation or covenant in whole or in part, and without prejudice to its right to complete the transaction of purchase and sale contemplated by this Agreement and claim
damages for breach of representation, warranty or covenant. 
  
 ARTICLE 10 – CONDITIONS OF CLOSING IN FAVOUR OF THE VENDOR 
  

	10.1	Conditions of Closing. 

  
 The obligation of the Vendor to sell the Purchased Assets is subject to the fulfillment, performance and satisfaction of each of the conditions set forth
below. The Purchaser acknowledges that the following conditions are for the exclusive benefit of the Vendor. 
  

	 	(a)	 Representations and Warranties. All representations and warranties of the Purchaser made in or pursuant to this Agreement shall be true and correct at the
Time of Closing in all material respects with the same force and effect as if made 

  

 - 22 - 

	 	 
at and as of such time and date, and the Purchaser shall have delivered to the Vendor at the Time of Closing a certificate dated the Closing Date, duly
executed by an officer of the Purchaser acceptable to the Vendor, to such effect. The receipt of such certificate and the Closing of the transaction of purchase and sale provided for in this Agreement shall not be nor be deemed to be a waiver of the
representations and warranties contained in this Agreement, which representations and warranties shall continue in full force and effect for the benefit of the Vendor as provided in Article 8. 

  

	 	(b)	Performance of Covenants. The Purchaser shall have performed or complied with, in all material respects, all the obligations, covenants and agreements in this Agreement to be
performed or complied with by the Purchaser at or prior to the Time of Closing. The Purchaser shall not be in breach in any material respect of any covenant on its part contained in this Agreement and shall have delivered to the Vendor at the Time
of Closing a certificate, duly executed by an officer of the Purchaser acceptable to the Vendor, to such effect. 

  

	 	(c)	Consents and Approvals. All actions, approvals and consents listed on Schedule 6.4(1) and the consents or authorizations of any other Persons that are, in the
reasonable opinion of the Purchaser, required to be obtained in connection with the completion of the transactions contemplated by this Agreement, the execution of this Agreement, the Closing or the performance of any of the terms and conditions
hereof (other than any which are the responsibility, under applicable law, of the Purchaser to obtain), shall have been obtained by the Vendor at or prior to the Time of Closing on terms and conditions acceptable to the Purchaser, acting reasonably.
Such consents, in the case of a Contract, shall include an acknowledgement by the parties to such Contract as to the good standing of such Contract. 

  

	 	(d)	No Action to Restrain. No action or proceeding shall be pending or threatened by any governmental or regulatory agency or authority or any other Person (including a party
hereto) to restrain or prohibit the completion of the transaction contemplated by this Agreement. 

  

	 	(e)	Opinion of Counsel to the Purchaser. The Vendor shall have received an opinion dated the Closing Date from counsel to the Purchaser in the form attached as Schedule
10.1(e). 

  

	 	(f)	Corporate Approval. Prior to the Time of Closing, all necessary corporate action and authorization shall have been taken and obtained, as the case may be, by the Vendor and
its directors, officers and shareholder in connection with the sale of the Purchased Assets and the transactions contemplated hereunder. 

  

	 	(g)	Closing Documents and Proceedings. All documentation relating to the purchase and sale of the Purchased Assets and all documentation relating to the due authorization of the
performance by the Purchaser of its obligations under this Agreement shall have been approved by the Vendor and its counsel, acting reasonably, and the Vendor shall have received copies of all such documentation or other evidence as it may
reasonably request. 

  

 - 23 - 

	10.2	Waiver. 

  
 If any of the conditions set forth in this Article 10 have not been fulfilled, performed or satisfied at or prior to the Closing, the Vendor may, by
written notice to the Purchaser, terminate all of its obligations hereunder and each of the Vendor and the Purchaser shall be released from all its obligations under this agreement except that the provisions of the non-disclosure agreement between
the Vendor and the Purchaser dated October 8, 2002 shall continue in full force and effect as provided for therein. Any of these conditions may be waived in whole or in part by the Vendor by instrument in writing, without prejudice to any of its
rights of termination in the event of non-performance of any other condition, obligation or covenant in whole or in part, and without prejudice to its right to complete the transaction of purchase and sale contemplated by this Agreement and claim
damages for breach of representation, warranty or covenant. 
  
 ARTICLE 11 – RISK OF LOSS 
  

	11.1	Damage or Destruction. 

  
 The Purchased Assets shall be and remain at the risk of the Vendor up to and including the Time of Closing. If, prior to the Time of Closing, all or any
part of the Purchased Assets are destroyed or damaged by fire or any other casualty or shall be appropriated, expropriated or seized by governmental or other lawful authority, the Vendor shall have the option, exercisable by notice in writing given
no later than 10 Business Days after the Purchaser receives notice in writing from the Vendor of such destruction, damage, appropriate, expropriation or seizure: 
  

	 	(a)	to reduce the Purchase Price by an amount equal to the cost of repair, or, if destroyed or damaged beyond repair or appropriated, expropriated or seized, by an amount equal to the
replacement cost of the assets forming part of the Purchased Assets so destroyed, damaged, appropriated, expropriated or seized, and to complete the purchase, in which event all proceeds of insurance payable in respect of such damage or destruction,
or any compensation or award payable in respect of such appropriation, expropriation or seizure shall be paid to the Vendor; or 

  

	 	(b)	to terminate its obligations under this Agreement without further liability to the Purchaser if the value of the Purchased Assets destroyed, damaged, appropriated, expropriated or
seized exceeds $500,000.00. 

  

	11.2	Notice. 

  
 Upon the occurrence of any damage or destruction to, or appropriation, expropriation or seizure of, the Purchased Assets, the Vendor shall forthwith give
notice thereof in writing to the Purchaser. If any damage or destruction to, or appropriation, expropriation or seizure of, the Purchased Assets occurs within 10 Business Days before the Closing Date, the Vendor shall notify the Purchaser in writing
of its election under section 11.1 prior to the Time of Closing. 
  

 - 24 - 

	11.3	Notice of Reduction of Purchase Price. 

  
 If the Vendor elects to reduce the Purchase Price pursuant to section 11.1(a), the Vendor shall forthwith, and prior to the Time of Closing, give notice
in writing to the Purchaser as to the amount by which, in the Vendor’s reasonable opinion, the Purchase Price should be reduced. 
  

	11.4	Purchase Price. 

  
 If the Vendor elects to reduce the Purchase Price pursuant to section 11.1(a), the amount of the Purchase Price payable by the Purchaser to the Vendor
shall be applied first to reduce the Earn-Out Amount payable by the Purchaser to the Vendor in the reverse order of the payments thereof. 
  

	11.5	Extent of Loss. 

  
 If any dispute arises under this Article 11 with respect to the amount of any reduction in the Purchase Price (including a dispute as to the cost of
repair of a damaged asset or the cost of replacement of an asset which has been destroyed, appropriated, expropriated or seized), such dispute will be determined in accordance with the arbitration provisions contained in section 13.2. Closing shall
be delayed until the second Business Day after the determination of the amount of reduction in the Purchase Price. 
  

	11.6	Rights Cumulative. 

  
 The rights contained in this Article 11 are cumulative and are in addition to every other right contained in this Agreement. 
  
 ARTICLE 12 – CLOSING PROCEDURE 
  

	12.1	Closing. 

  
 The Closing shall take place at the offices of Gowling Lafleur Henderson LLP, Suite 2600, 160 Elgin Street, Ottawa, Ontario, K1P 1C3 at the Time of
Closing or at such other place and time as may be agreed to by the parties. 
  

	12.2	Procedure. 

  
 At the Time of Closing, upon satisfaction of all the conditions set out in Article 9 and Article 10 which have not been waived as provided therein,

  

	 	(a)	the Vendor shall deliver to the Purchaser: 

  

	 	(i)	all deeds, conveyances, bills of sale, transfers, assignments, assurances, consents and any other documents necessary or reasonably required to effectively transfer the Purchased
Assets to the Purchaser with good and marketable title free and clear of all Encumbrances, such documents to be in registrable form to the extent necessary; 

  

 - 25 - 

	 	(ii)	all withdrawals of trade names, business names or style registrations necessary to evidence that the Vendor no longer intends to use the trade names and business names relating to
the Purchased Business, and 

  

	 	(iii)	possession of the tangible Purchased Assets, provided that all costs of transporting any such assets from the locations described in section 4.1(g) shall be for the Purchaser’s
account; and 

  

	 	(b)	the Purchaser shall make the payment required by section 2.4(a). 

  
 ARTICLE 13 – GENERAL 
  

	13.1	Public Disclosure. 

  
 Except as may be required by the rules and regulations of any applicable stock exchanges, no public disclosure of any kind shall be made or permitted in
respect of the subject matter of this Agreement by any party without consultation with and the consent of the other parties (such consent not to be unreasonably withheld or delayed). If reasonably practicable in the circumstances, any party that is
legally compelled to make public disclosure, or is compelled by the rules and regulations of any applicable stock exchanges, shall give the other party the opportunity to review and comment on the disclosure before it is publicly made. 

 

	13.2	Arbitration. 

  
 Any controversy or claim arising out of or relating to this Agreement shall be settled by arbitration in accordance with the procedures set out in
Schedule 13.2. 
  

	13.3	Notice. 

  
 All notices required or permitted by this Agreement shall be in writing and delivered by hand or sent by electronic transmission to: 
  

	 	(a)	the Purchaser: 

  
 Lifeline Systems, Inc. 
 111 Lawrence Street 
 Framingham, Massachusetts 01702-8156 
 Attention: Sr. Vice President and Chief Financial Officer 
 Fax No.: (508) 988-1384 
  
 with a copy to: 
  
 Goodmans LLP 
 250 Yonge Street, Suite 2400 
 Toronto, Ontario M5B 2M6 
 Attention: Stephen Bloom 
 Fax No.: (416) 979-1234 
  

 - 26 - 

	 	(b)	the Vendor: 

  
 March Networks Corporation 
 Tower B, Suite 330 
 555 Legget Drive 
 Kanata, Ontario K2K 2X3 
 Attention: Chief Financial Officer 
 Fax No.: (613) 591-5210 
  
 with a copy to: 
  
 Gowling Lafleur Henderson LLP 
 160 Elgin Street, Suite 2600 
 Ottawa, Ontario K1P 1C3 
 Attention: Brian P. McIntomny 
 Fax No.: (613) 563-9869 
  
 or at such other address or fax number of which the addressee may from time to time have notified the addressor. A notice shall be deemed to have been sent and received
on the day it is delivered by hand or on the day on which transmission is confirmed, if telecopied. If such day is not a Business Day or if the notice is received after ordinary office hours (time of place of receipt), the notice shall be deemed to
have been sent and received on the next Business Day. 
  

	13.4	Costs. 

  
 Except as otherwise provided in this Agreement, each party shall be responsible for its own fees, expenses, and other costs incurred in connection with
the purchase and sale of the Purchased Assets. 
  

	13.5	Time of the Essence. 

  
 Time is of the essence to every provision of this Agreement. No extension, waiver or variation of any provision of this Agreement shall be deemed to
affect this provision and there shall be no implied waiver of this provision. 
  

	13.6	Further Acts. 

  
 The parties acknowledge that their co-operation is required to facilitate the Closing. The parties shall do or cause to be done all such further acts and
things as may be necessary or desirable to give full effect to this Agreement. 
  

	13.7	Jurisdiction. 

  
 This Agreement shall be governed by the laws of the Province of Ontario and the laws of Canada applicable therein. 
  

	13.8	Amendment. 

  
 This Agreement may be amended only by written agreement of the parties. 
  

 - 27 - 

	13.9	Waiver. 

  
 No waiver of any provision of this Agreement shall be binding unless it is in writing. No indulgence or forbearance by a party shall constitute a waiver
of such party’s right to insist on performance in full and in a timely manner of all covenants in this Agreement. Waiver of any provision shall not be deemed to waive the same provision thereafter, or any other provision of this Agreement at
any time. 
  

	13.10 Entire	Agreement. 

  
 This Agreement and the Schedules attached to this Agreement constitute the entire agreement among the parties pertaining to all the matters herein. Except
for the non-disclosure agreement between the Vendor and the Purchaser dated October 8, 2002 which shall survive the Closing in accordance with its terms, this Agreement supersedes all prior agreements, understandings, negotiations and discussions,
whether oral or written, of the parties including the term sheet between the parties dated May 2, 2003. 
  

	13.11 Severability.	

  
 If any provision of this Agreement is invalid or unenforceable, such provision shall be severed and the remainder of this Agreement shall be unaffected thereby but shall continue to be valid and enforceable to the
fullest extent permitted by law. 
  

	13.12 Counterparts.	

  
 This Agreement may be executed in one or more counterparts which, together, shall constitute one and the same Agreement and may be delivered by facsimile transmission. This Agreement shall not be binding upon any
party until it has been executed by each of the parties and delivered to all other parties. 
  

	13.13 Assignment.	

  
 Neither this Agreement nor any rights or obligations hereunder may be assigned, directly or indirectly, by either party without the prior written consent of the other party, provided that the Purchaser may assign any
of its rights or obligations under this Agreement to its lender(s) in connection with any bona fide financing and/or to any Affiliate of the Purchaser. 
  
 [INTENTIONALLY LEFT BLANK] 
  

 - 28 - 

	13.14 Enurement	and Binding Effect. 

  
 This Agreement shall be binding upon the parties hereto and their respective successors and assigns and shall enure to the benefit of the parties hereto
and their respective successors and permitted assigns. 
  
 IN
WITNESS WHEREOF the parties have duly executed this Agreement. 
  

	LIFELINE SYSTEMS, INC.
		
	By:	 	/s/ Dennis M. Hurley        
	 	

	 	 	Name:	 	Dennis M. Hurley
	 	 	Title:	 	Senior Vice President

  

		
	By:	 	 
	 	

	 	 	 Name:
 Title:

  

	 MARCH NETWORKS CORPORATION

		
	By:	 	/s/ Don Mills        
	 	

	 	 	Name:	 	Don Mills
	 	 	Title:	 	COO

  

		
	By:	 	/s/ Christine Cimaglia        
	 	

	 	 	Name:	 	Christine Cimaglia
	 	 	Title:	 	VP Finance, CFO

  

	

	 Pursuant to Item 601(b)(2) of Regulation S-K, schedules to the Asset Purchase Agreement are not
being filed herewith. Such omitted schedules will be provided to the Securities and Exchange Commission upon request.

	

  

	 Schedule 1.1(b)
	  	Acquired March Customers
	 Schedule 1.1(e)
	  	Inventories ordered but not yet paid for
	 Schedule 1.1(f)
	  	Intellectual Property
	 Schedule 1.1(h)
	  	Service Contracts
	 Schedule 1.1(m)
	  	Equipment
	 Schedule 1.1(o)
	  	Customer List
	 Schedule 1.1(t)
	  	Inventories
	 Schedule 1.1(bb)
	  	Records
	 Schedule 2.3
	  	Allocation of Purchase Price
	 Schedule 4.1(a)
	  	Purchased Business Jurisdictions
	 Schedule 4.1(e)
	  	Contracts
	 Schedule 4.1(o)
	  	Licenses
	 Schedule 4.1(p)
	  	Litigation
	 Schedule 6.4(1)
	  	Consents
	 Schedule 6.4(2)
	  	Form of Assignment of Contracts Agreement
	 Schedule 6.6
	  	Form of Non-Competition Agreement
	 Schedule 6.8
	  	Form of Telephone Customer Support Services Agreement
	 Schedule 6.9
	  	Form of Escrow Agreement
	 Schedule 9.1(f)
	  	Form of Opinion of Vendor’s Counsel
	 Schedule 10.1(e)
	  	Form of Opinion of Purchaser’s Counsel
	 Schedule 13.2
	  	Arbitration Procedures

  

 -2-Long-Term Incentive Plan

 
EXHIBIT 10.1 
  
 2003 LONG-TERM
INCENTIVE PLAN OF SCIENTIFIC-ATLANTA, INC. 
  

	1.	PURPOSE OF THE PLAN. This 2003 Long-Term Incentive Plan of Scientific-Atlanta, Inc. (henceforth referred to as “the Plan”), effective as of the date the Plan is approved
by the Company’s shareholders in accordance with Section 25 (“the Effective Date”) is intended to encourage officers and other employees of Scientific-Atlanta, Inc. (henceforth referred to as “the Company”) and its
Subsidiaries to acquire or increase their ownership of common stock of the Company on reasonable terms, to provide compensation opportunities for superior financial results and outstanding personal performance, to foster in participants a strong
incentive to put forth maximum effort for the continued success and growth of the Company and its Subsidiaries, and to assist in attracting and retaining the best available individuals to the Company and its Subsidiaries. 

 

	2.	DEFINITIONS. When used herein, the following terms shall have the meaning set forth below. 

  

	2.1	“Affiliate” means, with respect to any specified person or entity, a person or entity that directly or indirectly, through one or more intermediaries, controls, or is
controlled by, or is under common control with, the person or entity specified. 

  

	2.2	“Award” means an Option, Performance Award, Performance Share, Performance Unit, Restricted Stock Award, Restricted Stock Unit, or Stock Appreciation Right, whether
granted separately, in conjunction with, or in tandem with another Award pursuant to the Plan. 

  

	2.3	“Award Letter” means a written letter, agreement or other notice in such form as may from time to time be hereafter approved by the Committee, which Award Letter shall set
forth the terms and conditions of an Award under the Plan. 

  

	2.4	“Board” means the Board of Directors of the Company. 

  

	2.5	“Change in Control” shall mean the occurrence of any of the following events: 

  

	 	2.5.1	The acquisition in one or more transactions by any “Person” (as the term person is used for purposes of Section 13(d) or 14(d) of the Exchange Act of “Beneficial
Ownership” (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty percent (20%) or more of the combined voting power of the Company’s then outstanding voting securities (the “Voting Securities”),
provided, however, that for purposes of this paragraph (a), the Voting Securities acquired directly from the Company by any Person shall be excluded from the determination of such Person’s Beneficial Ownership of Voting Securities (but such
Voting Securities shall be included in the calculation of the total number of Voting Securities then outstanding); or 

  

	 	2.5.2	The individuals who are members of the Incumbent Board cease for any reason to constitute at least two-thirds of the Board; or 

  

	 	2.5.3	Approval by shareholders of the Company of: 

  

	 	2.5.3.1	 	A merger or consolidation involving the Company if the shareholders of the Company immediately before such merger or consolidation do not own, directly or indirectly, immediately
following such merger or consolidation, more than eighty percent (80%) of the combined voting power of the outstanding voting securities of the corporation resulting from such merger or consolidation in substantially the same proportion as their
ownership of the Voting Securities immediately before such merger or consolidation, or 

  

 19 of 44 

	 	2.5.3.2	A complete liquidation or dissolution of the Company or an agreement for the sale or other disposition of all or substantially all of the assets of the Company.

  

	 	2.5.4	Notwithstanding anything in this Section 2.5 to the contrary, a Change in Control shall not be deemed to occur solely because twenty percent (20%) or more of the then outstanding
Voting Securities is acquired by: 

  

	 	2.5.4.1	A trustee or other fiduciary holding securities under one or more employee benefit plans maintained by the Company or any of its subsidiaries, or 

  

	 	2.5.4.2	Any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the shareholders of the Company in the same proportion as their ownership of stock
in the Company immediately prior to such acquisition. 

  

	 	2.5.5	Moreover, notwithstanding anything in this Section 2.5 to the contrary, a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”)
acquired Beneficial Ownership of more than the permitted amount of the outstanding Voting Securities as a result of the acquisition of Voting Securities by the Company which, by reducing the number of Voting Securities outstanding, increases the
proportional number of shares Beneficially Owned by the Subject Person, provided, that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of Voting Securities by the Company, and after such
share acquisition by the Company, the Subject Person becomes the Beneficial Owner of any additional Voting Securities which increases the percentage of the then outstanding Voting Securities Beneficially Owned by the Subject Person, then a Change in
Control shall occur. 

  

	2.6	“Code” means the Internal Revenue Code of 1986, as amended from time to time, and reference to any specific provisions of the Code shall refer to the corresponding
provisions of the Code as it may hereafter be amended or replaced. 

  

	2.7	“Committee” means the Human Resources and Compensation Committee of the Board or any other committee appointed by the Board whose member or members meet the requirements
for eligibility to serve set forth in Section 4 of the Plan and which is vested by the Board with responsibility for the administration of the Plan; provided, however, that only those members of the committee of the Board who participate in
decisions relative to Awards under this Plan shall be deemed to be part of the “Committee” for purposes of this Plan. 

  

	2.8	“Company” means Scientific-Atlanta, Inc. 

  

	2.9	“Dividend Right” means the right of a Participant to receive an amount equal to the dividend which would be payable to the holder of a Share, pursuant to such terms and
conditions as may be established pursuant to this Plan and the determination of the Committee. 

  

	2.10	“Employees” means officers (including officers who are members of the Board) and other individuals who the Company or any of its Subsidiaries treats as an employee for
income tax reporting purposes, regardless of their status under common law. 

  

	2.11	“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and reference to any specific provisions of the Exchange Act shall refer to the
corresponding provisions of the Exchange Act as it may hereafter be amended or replaced. 

  

	2.12	 “Fair Market Value” means, with respect to the Shares, the closing sale price of such Shares on the New York Stock Exchange four o’clock PM (EST)
closing price on the date(s) in question, or, if the Shares shall not have been traded on any such date(s), the closing sale price on the New York Stock Exchange on the first day prior thereto on which the Shares were so traded or if the Shares are
not traded on the New York 

  

 20 of 44 

	 	 
Stock Exchange, such other amount as may be determined by the Committee by any fair and reasonable means. Fair Market Value determined by the Committee in
good faith shall be final, binding and conclusive on all parties. 

  

	2.13	“Incumbent Board” means the individuals who as of the Effective Date, were members of the Board and any individual becoming a director subsequent to the Effective Date
whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board; provided, however, that any individual who is not a member of the
Incumbent Board at the time he or she becomes a member of the Board shall become a member of the Incumbent Board upon the completion of two full years as a member of the Board; provided, further, however, that notwithstanding the foregoing, no
individual shall be considered a member of the Incumbent Board if such individual initially assumed office: 

  

	 	2.13.1	As a result of either an actual or threatened “election contest” (within the meaning of Rule 14a-11 promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the Board (a “Proxy Contest”), or; 

  

	 	2.13.2	With the approval of the other Board members, but by reason of any agreement intended to avoid or settle a Proxy Contest. 

  

	2.14	“Incentive Stock Option” means an Option meeting the requirements and containing the limitations and restrictions set forth in Section 422 of the Code.

  

	2.15	“Indexed Option” means an Option with an exercise price which either increases by a fixed percentage over time or changes by reference to a published index, as determined
by the Committee. In no event shall the exercise price at the time of grant be less than the Fair Market Value on the date of grant. 

  

	2.16	“Mature Shares” shall mean Shares which have been held by the Participant for a period of at least six (6) months and one (1) day after such Shares are issued, or, in the
case of Restricted Stock, vested. 

  

	2.17	“Non-Qualified Stock Option” means an Option other than an Incentive Stock Option. 

  

	2.18	“Option” means the right to purchase, at a price and for a term fixed by the Committee in accordance with the Plan, and subject to such other limitations and restrictions
as the Plan and the Committee impose, the number of Shares specified by the Committee. An Option may be either an Incentive Stock Option or a Non-Qualified Stock Option. 

  

	2.19	“Parent” means any corporation, other than the employer corporation, in an unbroken chain of corporations ending with the Company if each of the corporations other than
the employer corporation owns stock possessing more than fifty percent (50%) of the total combined voting power of all classes of stock in one of the other corporations in the chain. 

  

	2.20	“Participant” means any Employee to whom a grant of an Award has been made and is outstanding under the Plan. 

  

	2.21	“Performance Award” means Performance Units, Performance Shares or either or both of them. 

  

	2.22	 “Performance Objectives” means the specific targets and objectives established by the Committee under one or more, or a combination of or ratio between,
any key elements contained in or derived from the Company’s income statement, balance sheet and/or cash flow statement, or the equivalent measure in a business unit or function of the company, including but not limited to sales or revenue,
bookings, gross margin, costs and expenses, working capital, inventory, pre-tax and after-tax income, increase in cash, return on equity, return on assets, return on capital, earnings per share, return on sales, total shareholder return and net
income. These targets and objectives may represent performance vs. plan, performance vs. 

  

 21 of 44 

	 	 
historical performance or performance vs. a peer group of comparable companies established by the Committee. Results against targets and objectives shall be
determined and measured in accordance with generally accepted accounting principles as utilized by the Company in its reports filed under the Exchange Act. 

  

	2.23	“Performance Period” means a period of time established by the Committee for which Performance Objectives have been established, of not less than one nor more than ten
consecutive Company fiscal years. 

  

	2.24	“Performance Share” means a right, granted to a Participant under Section 12 of the Plan, that may be paid out as a Share. 

  

	2.25	“Performance Unit” means a right, granted to a Participant under Section 12 of the Plan, that may be paid entirely in cash, entirely in Shares, or such combination of cash
and Shares as the Committee in its sole discretion shall determine. 

  

	2.26	“Plan” means this Long-Term Incentive Plan. 

  

	2.27	“Regulation T” means Part 220, Chapter II, Title 12 of the Code of Federal Regulations, issued by the Board of Governors of the Federal Reserve System pursuant to the
Exchange Act, as amended from time to time, or any successor regulation which may hereafter be adopted in lieu thereof. 

  

	2.28	“Restricted Stock Award” means the right to receive Shares, but subject to forfeiture and/or other restrictions set forth in the related Award Letter and the Plan.
Restricted Stock Awards are subject to restrictions which lapse over time. 

  

	2.29	“Restricted Stock Unit” means the right to receive an Award, denominated in cash but payable in Shares but subject to forfeiture and/or other restrictions set forth in the
related Award Letter and the Plan. Restricted Stock Units are subject to restrictions which lapse over time. 

  

	2.30	“Rule 16b-3” means Rule 16b-3 of the General Rules and Regulations of the Exchange Act (or any successor rule or regulation). 

  

	2.31	“SAR” or “Stock Appreciation Right” means a stock appreciation right, which is a right to receive an amount in cash, or Shares, or a combination of cash and
Shares, as determined or approved by the Committee in its sole discretion, no greater than the excess, if any, of the Fair Market Value of a Share on the date the SAR is exercised, over the SAR Base Price. 

  

	2.32	“SAR Base Price” means the Fair Market Value of a Share on the date a SAR was granted, or if the SAR was granted in tandem with an Option (whether or not the Option was
granted on a different date than the SAR), in the Committee’s discretion, the option price of a Share subject to the Option. 

  

	2.33	“Securities Act” means the Securities Act of 1933, as amended from time to time, and reference to any specific provisions of the Securities Act shall refer to the
corresponding provisions of the Securities Act as it may hereafter be amended or replaced. 

  

	2.34	“Share” or “Shares” means a share or shares of the Company’s $0.50 par value common stock together with associated preferred stock rights, any security of
the Company issued in lieu of or in substitution of such common stock or, if by reason of the adjustment provisions contained herein any rights under an Award under the Plan pertain to any other security, such other security.

  

	2.35	“Subsidiary” or “Subsidiaries” means any corporation other than the employer corporation in an unbroken chain of corporations beginning with the employer
corporation if each of the corporations other than the last corporation in the unbroken chain owns stock possessing more than fifty percent (50%) of the total combined voting power of all classes of stock in one of the other corporations in such
chain. 

  

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	2.36	“Successor” means the legal representative of the estate of a deceased Employee or the person or persons who shall acquire the right to exercise an Award by bequest or
inheritance or by reason of the death of the Employee. 

  

	2.37	“Ten-Percent Shareholder” means an individual who “owns” as defined in Section 425 of the Code, stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of (i) the Company; (ii) if applicable, a Subsidiary, or (iii) if applicable, the Parent. 

  

	2.38	“Term” means the period during which a particular Award may be exercised. 

  

	3.	STOCK SUBJECT TO THE PLAN. 

  

	3.1	MAXIMUM NUMBER OF SHARES TO BE AWARDED.    The maximum number of Shares in respect for which Awards may be granted under the Plan shall be eight million
(8,000,000) Shares. 

  

	 	3.1.1	Such Shares may be in whole or in part, as the Board shall from time to time determine, authorized but unissued Shares, or issued Shares which shall have been reacquired by the
Company. 

  

	 	3.1.2	The number of SARs payable in cash and the number of units payable in cash under the Plan shall be counted when computing the total number of Shares available for Awards under the
Plan. 

  

	3.2	CERTAIN LIMITATIONS.    The maximum number of Shares with respect to which Options and SARs payable in Shares which may be granted during any three fiscal year
period to any Employee shall not exceed 3,000,000. The maximum dollar value with respect to which Awards (other than Options, Performance Shares and SARs payable in Shares) that are intended to qualify as performance-based compensation under Code
Section 162(m)(4)(C) which may be paid to any Employee for any particular Performance Period shall be Ten Million Dollars ($10,000,000). The maximum number of Shares which may be issued pursuant to the Plan as Restricted Stock, Restricted Stock
Units or Performance Shares shall be 3,000,000. 

  

	3.3	SHARES UNDERLYING EXPIRED, CANCELLED OR UNEXERCISED AWARDS.    Any Shares subject to issuance upon exercise of an Option or SAR, but which are not issued because
of a surrender, cancellation, lapse, expiration or termination of any such Option or SAR prior to issuance of the Shares, or any Shares subject to a SAR paid in cash, shall once again be available for issuance in satisfaction of Awards. Similarly,
any Shares issued or issuable pursuant to a Restricted Stock Award or Performance Award which are subsequently forfeited or not issued pursuant to the terms of the grant shall once again be available for issuance in satisfaction of Awards. If Shares
issued as Restricted Stock, Restricted Stock Units, or Performance Shares are forfeited or not issued pursuant to the Plan, they shall not be debited against the 3,000,000 limit on such Awards pursuant to Section 3.2. 

  

	4.	ADMINISTRATION OF THE PLAN. 

  

	4.1	MEMBERSHIP.    The Board shall appoint the Committee, which shall be comprised of one (1) or more directors or such greater number of directors as may be
required under applicable law and determined by the Board. In respect of any decisions regarding an Award intended to satisfy the requirements of Section 162(m) of the Code, the Committee shall be comprised of no less than two (2) members, each of
whom shall be an “outside director” within the meaning of Section 162(m) of the Code. The Board may, from time to time, appoint members to the Committee in substitution for or in addition to members previously appointed and may fill
vacancies, however caused, in the Committee, consistent with the qualifications listed above. 

  

	4.2	 COMMITTEE AUTHORITY. Subject to the provisions of the Plan, the Committee shall have full authority, in its discretion, to determine the Employees to whom Awards
shall be granted, the number of Options, 

  

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Shares, Performance Units, Restricted Stock Units or SARs to be covered by each of the Awards, and the terms (including restrictions and/or Performance
Objectives) of any such Award; to amend or cancel Awards (subject to Section 21 of the Plan); to extend or accelerate the vesting or exercisability of Awards or extend the term of any Award within the maximum ten-year term of Awards (subject to the
restrictions in Section 6.3); to require the cancellation or surrender of any Award previously granted under this Plan or any other plans of the Company as a condition to the granting of an Award; to construe or interpret the Plan, any Award Letter
and any documents defining the rights and obligations of the Company and any Participant in connection with the Plan; and to prescribe, amend, and rescind rules and regulations relating to it, and generally to interpret and determine any and all
matters whatsoever relating to the administration of the Plan and the granting of Awards hereunder. The Committee shall make such rules and regulations for the conduct of its business as it shall deem advisable, including the ability to delegate
administrative functions to an officer of the Company. All determinations and decisions by the Committee in the exercise of its powers shall be final, binding and conclusive. 

  

	4.3	OFFICER COMMITTEE.    An officer committee consisting of the Company’s chief human resources officer, chief legal officer and chief financial officer is
authorized to make any non-substantive or administrative amendments to the Plan necessary to carry out the administration of the Plan. 

  

	4.4	REPRICING OF OPTIONS AND SAR BASE PRICE.    No change in the exercise price of a Stock Option (other than the change in the exercise price of an Indexed
Option based on the movement of the underlying index) or in the SAR Base Price shall be made without the expressed approval of the shareholders of the Company. Notwithstanding this section, if there is a change in the capitalization of the Company,
any outstanding Awards may be adjusted pursuant to Section 16 of the Plan. 

  

	4.5	LIMITS ON LIABILITY.    No member of the Committee shall be liable, in the absence of bad faith, for any act or omission with respect to his service on the
Committee. 

  

	5.	EMPLOYEES TO WHOM AWARDS MAY BE GRANTED. 

  

	5.1	Awards may be granted in each year or portion thereof while the Plan is in effect to such of the Employees as the Committee, in its discretion, shall determine.

  

	5.2	Receipt of an Award by an Employee in one year neither guarantees nor implies that the Employee shall be eligible to receive an Award in any subsequent year.

  

	6.	STOCK OPTIONS. 

  

	6.1	TYPES OF OPTIONS. 

  

	 	6.1.1	Options granted under this Plan may be Incentive Stock Options or Non-Qualified Stock Options. In addition, Non-Qualified Stock Options may be issued as Indexed Options.

  

	 	6.1.2	The Award Letter for an Option shall designate whether an Option is an Incentive Stock Option or a Non-Qualified Stock Option, or a combination of Incentive Stock Options and
Non-Qualified Stock Options. Any Option not specifically designated as an Incentive Stock Option shall be treated as a Non-Qualified Stock Option by the Company and the Participant to whom the Option is granted for federal income tax purposes.

  

	6.2	OPTION PRICE.    The option price per Share of any Option granted under the Plan shall not be less than the Fair Market Value of the Shares covered by the Option
on the date the Option is granted. 

  

	 	6.2.1	Notwithstanding anything herein to the contrary, in the event an Incentive Stock Option is granted to an Employee who, at the time such Incentive Stock Option is granted, is a
Ten-Percent Shareholder, then the option price per Share of such Incentive Stock Option shall not be less than one hundred ten percent (110%) of the Fair Market Value of the Shares covered by the Incentive Stock Option on the date the Incentive
Stock Option is granted. 

  

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	 	6.2.2	In the case of an Indexed Option, the Committee shall determine the exercise price of such Indexed Option and the terms and conditions that affect, if any, any adjustments to the
exercise price of such Indexed Option, but under no circumstances shall the Committee set the exercise price at the time of grant at less than Fair Market Value on the date of the grant. 

  

	6.3	TERM OF OPTIONS.    Options granted hereunder shall be exercisable for a Term expiring on the tenth anniversary of the date of grant and shall be subject to
earlier termination as hereinafter provided, or such lesser term as may be specified in an Award Letter issued hereunder. No Option shall become exercisable before than the first anniversary of the date of the grant. The full vesting period for any
Option shall not be less than the third anniversary of the date of grant and no more than one-third of the Shares granted in the Option shall vest in any one year. Notwithstanding anything herein to the contrary, in the event an Incentive Stock
Option is granted to an Employee who, at the time such Incentive Stock Option is granted, is a Ten-Percent Shareholder, then such Incentive Stock Option shall not be exercisable more than five (5) years from the date of grant and shall be subject to
earlier termination as hereinafter provided. 

  

	6.4	LIMIT ON FAIR MARKET VALUE OF INCENTIVE STOCK OPTIONS.    In any calendar year, no Employee may be granted an Incentive Stock Option hereunder to the extent that
the aggregate Fair Market Value (such Fair Market Value being determined as of the date of grant of the Option in question) of the Shares with respect to which Incentive Stock Options first become exercisable by the Employee during any calendar year
(under all such plans of the Employee’s employer corporation, its Parent, if any, and its Subsidiaries, if any) exceeds the maximum amount allowed pursuant to Section 422 of the Internal Revenue Code (as from time to time amended). For purposes
of the preceding sentence, Options shall be taken into account in the order in which they were granted. Any Option granted under the Plan which is intended to be an Incentive Stock Option, but which exceeds the limitation set forth in this Section
6.4, shall be a Non-Qualified Stock Option to the extent that a portion of the Option exceeds this limitation. 

  

	7.	STOCK APPRECIATION RIGHTS. 

  

	7.1	GRANT OF SAR.    The Committee, in its discretion, may grant an Employee a SAR either on a free-standing basis or in tandem with an Option. The Committee, in its
discretion, may grant a SAR in tandem with an Option either at the time the Option is granted or at any time thereafter, so long as the grant of the SAR is made during the period in which grants of SARs may be made under the Plan. The Committee, in
its discretion, may grant a SAR in tandem with an Option, which is exercisable either in lieu of, or in addition to, exercise of the related Option. 

  

	7.2	LIMITATIONS ON EXERCISE. Each SAR granted in tandem with an Option shall be exercisable to the extent, and only to the extent, the related Option is exercisable and shall be for
such Term as the Committee may determine (which Term, which is not to exceed the tenth anniversary of the date of the grant, may expire prior to the Term of the related Option). Each SAR granted on a stand alone basis shall be exercisable to the
extent, and for such Term, as the Committee may determine. The SARs shall be subject to such other terms and conditions as the Committee, in its discretion, shall determine and which are not otherwise inconsistent with the Plan. The terms and
conditions may include Committee approval of the exercise of the SAR, limitations on the time within which and the extent to which such SAR shall be exercisable, and limitations, if any, on the amount of appreciation in value which may be recognized
with regard to such SAR. The Company’s obligation to any Participant exercising a SAR may be paid in cash or Shares, or partly in cash or Shares, at the sole discretion of the Committee, or as defined in the Award Letter at the time of the
Award. If, and to the extent that, Shares are issued in satisfaction of amounts payable on exercise of a SAR, the Shares shall be valued at their Fair Market Value on the date of exercise. 

  

	7.3	SARS IN TANDEM WITH INCENTIVE STOCK OPTIONS. With respect to SARs granted in tandem with Incentive Stock Options, the following shall apply: 

  

	 	7.3.1	No SAR shall be exercisable unless the Fair Market Value of the Shares on the date of exercise exceeds the option price of the related Incentive Stock Option.

  

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	 	7.3.2	In no event shall any amounts paid pursuant to the SAR exceed the difference between the Fair Market Value of the Shares on the date of exercise and the exercise price of the
related Incentive Stock Option. 

  

	 	7.3.3	The SAR must expire no later than the last date the related Incentive Stock Option can be exercised. 

  

	7.4	SURRENDER OF OPTION OR SAR GRANTED IN TANDEM.    If the Award Letter related to the grant of a SAR in tandem with an Option provides that the SAR can only be
exercised in lieu of the related Option, then, upon exercise of such SAR, the related Option or portion thereof with respect to which such SAR is exercised shall be deemed surrendered and shall not thereafter be exercisable and, similarly, upon
exercise of the Option, the related SAR or portion thereof with respect to which such Option is exercised shall be deemed surrendered and shall not thereafter be exercisable. If the Award Letter related to the grant of a SAR in tandem with an Option
provides that the SAR can be exercised in addition to, or separate from, the related Option, then, upon exercise of such SAR, the related Option or portion thereof with respect to which such SAR is exercised shall not be deemed surrendered and shall
continue to be exercisable and, similarly, upon exercise of the Option, the related SAR or portion thereof with respect to which such Option is exercised shall not be deemed surrendered and shall continue to be exercisable. 

 

	8.	EXERCISE OF RIGHTS UNDER OPTION OR SAR AWARDS. 

  

	8.1	NOTICE OF EXERCISE.    An Employee entitled to exercise an Option or SAR may do so by delivery of notice, in a manner and form established by the Company in its
sole discretion. Except as provided in Section 8.2 below, the notice shall be accompanied by payment in full of the purchase price of any Shares to be purchased, which payment may be made in cash or, in Mature Shares valued at Fair Market Value at
the time of exercise or, a combination thereof. No Shares shall be issued upon exercise of an Option until full payment has been made therefor. All notices or requests provided for herein shall be delivered to the Company as determined by the
Committee. 

  

	8.2	CASHLESS EXERCISE PROCEDURES.    The Committee, in its sole discretion, may establish procedures for Options or SARs whereby an Employee, subject to the
requirements of Regulation T, federal income tax laws, and other applicable federal, state and local tax and securities laws, can exercise an Option or a portion thereof without making a direct payment of the option price to the Company. If the
Committee so elects to establish a cashless exercise program, the Committee shall determine, in its sole discretion, and from time to time, such administrative procedures and policies as it deems appropriate and such procedures and policies shall be
binding on any Employee wishing to utilize the cashless exercise program. 

  

	8.3	FRACTIONS OF SHARES.    An Option may not be exercised for a fraction of a Share. 

  

	8.4	NO DIVIDEND ADJUSTMENT.    No adjustment will be made for a dividend or other right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 16 of the Plan. 

  

	9.	RIGHTS OF OPTION AND SAR HOLDERS.    The holder of an Option or SAR shall not have any of the rights of a shareholder with respect to the Shares subject to
purchase or issuance under such Award, except to the extent that one or more certificates for such Shares shall be delivered to the holder upon due exercise of the Option or SAR. 

  

	10.	RESTRICTED STOCK AWARDS. 

  

	10.1	Restricted Stock may be issued either alone, in addition to, or in tandem with other Awards granted under the Plan and/or cash awards made outside of the Plan. After the Committee
determines that it will grant an award of Restricted Stock under the Plan, it shall advise the Employee in writing of the terms, conditions and restrictions related to the offer, including the Restricted Period (as defined in Section 10.2)
applicable to such award, the imposition, if any, of any performance-based condition or other condition or restriction on an award of Restricted Stock, and the number of Shares. The prospective recipient of an Award of Restricted Stock shall not
have any rights with respect to any such Award, unless and until such recipient has executed an Award Letter, in the form determined by the Committee, evidencing the Award. 

  

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	10.2	LAPSE OF RESTRICTIONS.    With respect to an award of Restricted Stock, which becomes non-forfeitable due to the lapse of time, the Committee shall prescribe in
the Award Letter, the period in which such Restricted Stock becomes non-forfeitable (the “Restricted Period”). Notwithstanding any provision to the contrary, any award of Restricted Stock to an eligible recipient that is not based, at
least in part on the attainment of Performance Objectives, other than a recipient who, as determined by the Committee, is a “new hire” of the Company, any Parent or any Subsidiary, shall have a Restricted Period which is at least three (3)
years from the date of the Award; provided, however, that the Committee may provide, in its sole discretion, that upon the termination of such Employee’s employment with the Company, any Parent or any Subsidiary, by the Company (or any Parent
or any Subsidiary) without Cause, such Restricted Period shall be deemed to have lapsed and such award of Restricted Stock shall be non-forfeitable on the recipient’s termination date. 

  

	10.3	CERTIFICATES.    Each Participant who is granted an Award of Restricted Stock shall be issued a stock certificate in respect of such shares of Restricted Stock,
which certificate shall be registered in the name of the recipient and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to any such Award; provided that the Company may require that the stock
certificates evidencing Restricted Stock granted hereunder be held in the custody of the Company until the restrictions thereon shall have lapsed, and that, as a condition of any Award of Restricted Stock, the Participant shall have delivered a
stock power, endorsed in blank, relating to the Shares covered by such Award. 

  

	10.4	RIGHTS AS A SHAREHOLDER.    Except as otherwise provided in an Award Letter, the Participant shall possess all incidents of ownership with respect to Shares of
Restricted Stock during the Restricted Period, including the right to receive or reinvest dividends with respect to such Shares and to vote such Shares. Certificates for unrestricted Shares shall be delivered to the Participant promptly after, and
only after, the Restricted Period shall expire without forfeiture in respect of such Awards of Restricted Stock or such other applicable terms, conditions, and Performance Objectives have been satisfied, except as the Committee, in its sole
discretion, shall otherwise determine. 

  

	10.5	RESTRICTION PERIOD.    During the Restriction Period, the recipient of such award shall not be permitted to sell, transfer, pledge, hypothecate or assign shares
of Restricted Stock awarded under the Plan except by will or the laws of descent and distribution. Any attempt to dispose of any Restricted Stock in contravention of any such restrictions shall be null and void and without effect.

  

	10.6	RESTRICTED STOCK AWARD LETTER.    The Award Letter for Restricted Stock Awards shall contain such other terms, provisions and conditions not inconsistent with
the Plan as may be determined by the Committee in its sole discretion. In addition, the provisions of Award Letters for Restricted Stock Awards need not be the same with respect to each Participant. 

  

	11.	RESTRICTED STOCK UNITS. 

  

	11.1	GENERAL.    Restricted Stock Units may be issued either alone, in addition to, or in tandem with other Awards granted under the Plan and/or cash awards made
outside of the Plan. After the Committee determines that it will grant Restricted Stock Units under the Plan, it shall advise the Participant in writing of the terms, conditions and restrictions related to the offer, including the Restricted Unit
Period (as defined in this Section 11) applicable to an award, the imposition, if any, of any performance-based condition or other restriction on an award, and the number of Restricted Stock Units to which such person shall be entitled. The
prospective recipient of an Award of Restricted Stock Units shall not have any rights with respect to any such Award, unless and until such recipient has executed an Award Letter, in the form determined by the Committee, evidencing the Award.

  

	11.2	 LAPSE OF RESTRICTIONS.    With respect to an award of Restricted Stock Units, which becomes non-forfeitable due to the lapse of time, the
Committee shall prescribe in the Award Letter, the period in which 

  

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such Restricted Stock becomes non-forfeitable (the “Restricted Unit Period”). Notwithstanding any provision to the contrary, the Restricted Unit
Period shall be a period which is at least three (3) years from the Award. 

  

	11.3	RIGHTS AS A SHAREHOLDER.    A recipient who is awarded Restricted Stock Units shall possess no incidents of ownership with respect to such Units; provided that
the award agreement may provide for payments in lieu of dividends to such recipient. 

  

	11.4	RESTRICTED STOCK UNITS AWARD LETTER.    The Award Letter for Restricted Stock Units shall contain such other terms, provisions and conditions not inconsistent
with the Plan as may be determined by the Committee in its sole discretion. In addition, the provisions of Award Letters for Restricted Stock Units need not be the same with respect to each Participant. 

  

	12.	PERFORMANCE AWARDS. 

  

	12.1	PERFORMANCE PERIODS.    The Committee shall establish Performance Periods applicable to Performance Awards. There shall be no limitation on the number of
Performance Periods established by the Committee and more than one Performance Period may encompass the same fiscal year. 

  

	12.2	PERFORMANCE OBJECTIVES.    If the Committee determines that a Performance Award is intended to qualify as performance-based compensation under Code Section
162(m)(4)(C), then such Performance Award shall be subject to the attainment of Performance Objectives for a Performance Period. Such specific Performance Objectives shall be established in writing no later than ninety (90) days after the
commencement of the Performance Period to which the Performance Objectives relate, but in no event after twenty-five percent (25%) of the Performance Period has elapsed. In establishing the Performance Objective or Performance Objectives, the
Committee shall also establish a schedule or schedules setting forth the portion of the Performance Award which will be earned or forfeited based on the degree of achievement of the Performance Objectives actually achieved or exceeded as determined
by the Committee. The Committee may at any time adjust the Performance Objectives and any schedules and portions of payments related thereto, adjust the way Performance Objectives are measured, or shorten any Performance Period if it determines that
conditions or the occurrence of events warrant such actions; provided, that this provision shall not apply to any Performance Award that is intended to qualify as performance--based compensation under Code Section 162(m)(4)(C) if and to the extent
that it would prevent the Award from so qualifying. The Committee shall have the right to reduce or eliminate the compensation or Award payable upon the attainment of a Performance Objective but shall not have the discretion to increase an Award
upon the attainment of a Performance Objective with respect to a Participant whose compensation for the particular year is subject to the limits on tax deductibility in Code Section 162(m). 

  

	12.3	GRANTS OF PERFORMANCE AWARDS.    Performance Awards may be granted under the Plan as either Performance Shares or Performance Units, as the Committee may from
time to time approve. Performance Awards may be granted alone, in addition to or in tandem with other Awards under the Plan. Subject to the terms of the Plan, the Committee shall determine the amount or number of Performance Awards to be granted to
a Participant and the Committee may impose different terms and conditions on any particular Performance Award granted to any Participant. Each grant of a Performance Award shall be evidenced by a written instrument stating the number of Performance
Shares or Performance Units granted, the Performance Period, the Performance Objective or Performance Objectives, the proportion of payments for performance between the minimum and full performance levels, if any, restrictions applicable to Shares
receivable in settlement, if any, and any other terms, conditions, restrictions and rights with respect to such grant as determined by the Committee. The Committee may determine that the Participant forfeit such Performance Awards back to the
Company upon termination of employment for any reason or for specified reasons. The Committee may provide, in its sole discretion, that during a Performance Period, a Participant shall be paid cash amounts, with respect to each Performance Share or
Performance Unit held by such individual in the same manner, at the same time, and in the same amount paid, as a dividend on any Share. 

  

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	12.4	PERFORMANCE PERIOD.    During the Performance Period, the recipient of such award shall not be permitted to sell, transfer, pledge, hypothecate or assign
Performance Awards except by will or the laws of descent and distribution. Any attempt to dispose of any Performance Awards in contravention of any such restrictions shall be null and void and without effect. 

  

	12.5	PERFORMANCE AWARD LETTER.    The Award Letter for a Performance Award shall contain such other terms, provisions and conditions not inconsistent with the Plan as
may be determined by the Committee in its sole discretion. In addition, the provisions of Award Letters for Performance Awards need not be the same with respect to each Participant. 

  

	12.6	NON-TRANSFERABILITY OF PERFORMANCE AWARDS.    Until such time as the Performance Objectives as determined by the Committee have been met and until any
restrictions upon the Performance Units or Performance Shares issued pursuant to any Performance Awards have lapsed, Performance Awards and any rights related thereto may not be sold, exchanged, transferred, pledged, hypothecated or otherwise
disposed of by any Participant. 

  

	12.7	PAYMENT OF AWARDS.    As soon as practicable after the end of the applicable Performance Period as determined by the Committee, the Committee shall determine the
extent to which the Performance Objectives have been met and the extent to which Performance Awards are payable. Payment and settlement of a Performance Award shall be as follows: 

  

	 	12.7.1	In the case of Performance Shares, one or more stock certificates representing the number of Shares payable shall be delivered to the Participant, free of all restrictions except
those established by the Committee at the time of the grant of the Performance Shares; and 

  

	 	12.7.2	In the case of Performance Units, entirely in cash, entirely in Shares, or in such combination of Shares and cash as the Committee may determine, in its discretion, prior to such
payment. If payment is to be made in the form of cash, the amount payable for each Performance Unit earned shall be equal to the dollar value of each Performance Unit (as determined by the Committee) times the number of earned Performance Units.

  

	12.8	RIGHTS AS A SHAREHOLDER. Except as otherwise provided in an Award Agreement and subject to the limitations contained in this Plan, the Participant shall possess all incidents of
ownership with respect to Performance Shares during the Performance Period, including the right to receive or reinvest dividends with respect to such Shares and to vote such Shares. Certificates for unrestricted Shares shall be delivered to the
Participant promptly after, and only after, the Performance Objective or Objectives have been achieved, except as the Committee, in its sole discretion, shall otherwise determine. No rights as a shareholder shall accrue to Performance Units.

  

	13.	AWARD TERMS AND CONDITIONS.    Each Award Letter setting forth an Award shall contain such other terms and conditions not inconsistent herewith as shall be
approved by the Board or by the Committee. The Committee shall from time to time adopt policies and procedures applicable to Awards that will govern the lapse or non-lapse of restrictions and the rights of Participants and beneficiaries in the event
of death, disability, leave of absence, termination of employment, or retirement of Participants or upon the occurrence of any other event determined by the Committee, in its sole discretion, to be appropriate. The Committee shall have authority to
define disability, leave of absence, termination of employment and retirement and other terms, and the Committee’s policies and procedures may differ with respect to Awards granted at different times. A Participant’s rights in the event of
death, disability, leave of absence, termination of employment, or retirement or such other events shall be set forth in the Award Letter that evidences an Award to the Participant. 

  

	14.	 NON-TRANSFERABILITY OF AWARDS.    An Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of, or disposed of in any
manner other than by will or by the laws of descent or distribution; provided, however, that the Committee may, in its discretion, grant transferable Nonstatutory 

  

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Stock Options pursuant to option agreements specifying (i) the manner in which such Nonstatutory Stock Options are transferable and (ii) that any such
transfer shall be subject to the Applicable Laws. Except as otherwise provided by the Administrator, an Award may only be exercised or purchased during the lifetime of the recipient of the Award or a transferee of a Nonstatutory Stock Option as
permitted by this Section 14. 

  

	15.	VESTING OF AWARDS.    The Committee may, in its sole discretion, grant Awards which vest over time and/or are based upon satisfaction of Performance Objectives.
The Committee may, in its discretion, modify or change any Performance Objectives concerning any Award or accelerate the vesting of any Award; provided that the Committee shall not modify or change any Performance Objective or accelerate the vesting
of any Award that is intended to qualify as performance-based compensation under Code Section 162(m)(4)(C) if and to the extent that such modification, change or acceleration would prevent the Award from so qualifying. 

  

	16.	ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.    In the event of changes in all of the outstanding Shares by reason of stock dividends, stock splits,
recapitalizations, mergers, consolidations, combinations, or exchanges of shares, separations, reorganizations or liquidations or similar events or in the event of extraordinary cash or non-cash dividends being declared with respect to outstanding
Shares or other similar transactions, the number and class of Shares available under the Plan in the aggregate, the number and class of Shares subject to Awards theretofore granted, the number of SARs therefore granted, applicable purchase prices,
applicable Performance Objectives for the Performance Periods not yet completed and performance levels and portion of payments related thereto, and all other applicable provisions, shall, subject to the provisions of the Plan, be equitably adjusted
by the Committee. The foregoing adjustment and the manner of application of the foregoing provisions shall be determined by the Committee in its sole discretion. Any such adjustment may provide for the elimination of any fractional Share which might
otherwise become subject to an Award. 

  

	17.	CHANGE IN CONTROL. 

  

	17.1	EFFECT ON AWARDS.    In the event of a Change in Control, then 

  

	 	17.1.1	All Options, SARs and Options in tandem with SARs then outstanding shall become fully exercisable as of the date of the Change in Control, whether or not then exercisable,

  

	 	17.1.2	All restrictions and conditions of all Restricted Stock Awards then outstanding shall be deemed satisfied as of the date of the Change in Control, and 

  

	 	17.1.3	All Performance Shares and Performance Units shall be deemed to have been fully earned as of the date of the Change in Control. 

  

	17.2	CHANGE OF CONTROL AWARDS.    The Committee, in its sole discretion, may at any time, and subject to the terms and conditions as it may impose:

  

	 	17.2.1	Grant Awards that become exercisable only in the event of a Change in Control; 

  

	 	17.2.2	Provide for Awards to be exercised automatically and only for cash in the event of a Change in Control, and; 

  

	 	17.2.3	Provide in advance of, or at the time of, a Change in Control for cash to be paid in settlement of any Award in the event of a Change in Control, with the amount of such payment to
be not less than the value of the Award at the time of the Change of Control. 

  

	17.3	 TERMINATION OF EMPLOYMENT.    Notwithstanding anything contained in this Plan to the contrary, in the event a Change in Control takes place and
a Participant’s employment is terminated prior to the Change in Control and the Participant reasonably demonstrates that such termination: (i) was at the request of a third party who has indicated an intention or taken steps reasonably
calculated to effect a Change in Control and who effectuates the Change in Control or (ii) otherwise occurred in connection with or in 

  

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 anticipation of a Change in Control which actually occurs; then for all purposes of this Plan, the date
of the Change in Control in respect of such Participant shall mean the date immediately prior to the date of termination of such Participant’s employment. 
  

	18.	FORM OF AWARDS.    Nothing contained in the Plan nor any resolution adopted or to be adopted by the Board or the shareholders of the Company shall constitute the
granting of any Award. An Award shall be granted hereunder at such date or dates as the Committee may determine, subject to the Plan. Whenever the Committee determines to grant an Award, the chief human resources officer of the Company, or such
other person as the Committee appoints, shall send notice thereof to the Employee, in such form as the Committee approves, stating the number of Options, Shares, Performance Units, Restricted Stock Units and SARs subject to the Award, its Term, and
the other provisions, restrictions and conditions thereof. The notice shall be accompanied by a written Award Letter (and, in the case of a Restricted Stock Award or a Performance Share Award, by a blank stock power and/or escrow agreement for
execution by the Employee) which shall have been duly executed by or on behalf of the Company. If the surrender of previously issued Awards is made a condition of the grant, the notice shall set forth the pertinent details of such condition.
Execution of an Award Letter by the recipient in accordance with the provisions of the Plan shall be a condition precedent to the exercise or settlement of any Award. 

  

	19.	WITHHOLDING FOR TAXES. 

  
 The Company shall, before any payment is made or a certificate for any Shares is delivered or any Shares are credited to any brokerage account, deduct or
withhold from any payment under the Plan any Federal, state, local or other taxes, including transfer taxes, required by law to be withheld or to require the Participant or his or her beneficiary or estate, as the case may be, to pay any amount, or
the balance of any amount, required to be withheld. The Company may elect to deduct such taxes from any amounts payable then or any time thereafter in cash to the Employee and, in the Employee’s sole discretion, the payment of such taxes may be
made from Mature Shares previously held by such Employee or from Shares obtained by the exercise of the Option. In the event the Employee disposes of Shares acquired pursuant to an Incentive Stock Option in any transaction considered to be a
disqualifying transaction under Sections 421 and 422 of the Code, the Employee must give the Company written notice of such transfer and the Company shall have the right to deduct any taxes required by law to be withheld from any amounts otherwise
payable to the Employee. 
  

	20.	TERMINATION OF PLAN.    The Plan shall terminate on the tenth anniversary of the Effective Date, and an Award shall not be granted under the Plan after that date
although the terms of any Awards may be amended at any date prior to the end of its Term in accordance with the Plan. Any Option granted under the Plan after August 13, 2013 shall not qualify as an Incentive Stock Option. Any Awards outstanding at
the time of termination of the Plan shall continue in full force and effect according to the terms and conditions of the Award and this Plan. 

  

	21.	AMENDMENT OF THE PLAN. 

  

	21.1	The Board may amend, alter, suspend, discontinue, or terminate the Plan or any portion thereof at any time; provided, that no such amendment, alteration, suspension, discontinuation
or termination shall be made without shareholder approval if such approval is necessary to comply with any tax, securities or regulatory law, rules of exchange or requirement with which the Board intends the Plan to comply. 

 

	21.2	Notwithstanding the foregoing, no such amendment or termination of the Plan shall materially adversely affect Awards already granted and such Awards shall remain in full force and
effect as if this Plan had not been amended or terminated, unless mutually agreed otherwise between the Participant and the Committee, which agreement must be in writing and signed by the Participant and the Company. 

  

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	22.	GOVERNING LAW; REGULATIONS AND APPROVALS. 

  

	22.1	GOVERNING LAW.    This Plan and the rights of all persons claiming hereunder shall be construed and determined in accordance of the laws of the State of Georgia
without giving effect to the conflicts of laws principles thereof, except to the extent that such laws are preempted by federal law. 

  

	22.2	DELIVERY OF SHARES.    The obligation of the Company to issue, sell and deliver Shares with respect to any Awards granted under this Plan shall be subject to all
applicable laws, rules and regulations, including all applicable federal and state securities laws, and the obtaining of all such approvals by governmental agencies as may be deemed necessary or appropriate by the Committee.

  

	22.3	SECURITIES ACT REQUIREMENTS.    No award shall be granted and no certificates for Shares pursuant to the grant or exercise of an Award shall be delivered
pursuant to this Plan if the grant or delivery would, in the opinion of counsel for the Company, violate the Securities Act or any other Federal or state statutes having similar requirements as may be in effect at that time. As a condition of the
issuance of any Shares pursuant to the grant or exercise of an Award under this Plan, the Committee may require the recipient to furnish a written representation that he or she is acquiring the Shares for investment and not with a view to
distribution to the public. In the event that the disposition of Shares acquired pursuant to the Plan is not covered by a then current registration statement under the Securities Act, as amended, and is not otherwise exempt from such registration,
such Shares shall be restricted against transfer to the extent required by the Securities Act and Rule 144 of the Securities Act or the regulations hereunder. 

  

	22.4	LISTING AND REGULATORY REQUIREMENTS.    Each Award is subject to the further requirements that, if at any time the Committee shall determine, in its discretion,
that the listing, registration or qualification of the Shares subject to the Award is required by any securities exchange or under any applicable law or the rule of any regulatory body, or is necessary or desirable as a condition of, or in
connection with, the granting of such Award or the issuance of Shares thereunder, such Award will not be granted or exercised and the Shares may not be issued unless and until such listing, qualification, consent or approval shall have been effected
or obtained free of any conditions not acceptable to the Committee. 

  

	22.5	SECTION 16.    With respect to persons subject to Section 16 of the Exchange Act, transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successors under the Exchange Act. To the extent any provision under the Plan or action by the Committee fails to so comply, it shall be deemed null and void to the extent permitted by law and deemed advisable by the
Committee. 

  

	22.6	PERFORMANCE-BASED COMPENSATION.    The Plan is intended to give the Committee the authority, in its discretion, to grant Awards that qualify as performance-based
compensation under Code Section 162(m). 

  

	23.	DEFERRAL ELECTIONS.    The Committee may, pursuant to the terms of an Award Letter or otherwise in its discretion, permit any Participant receiving an Award to
elect to defer his or her receipt of a payment of cash or the delivery of Shares that would be otherwise due such individual by virtue of the exercise, settlement, vesting or lapse of restrictions regarding any Award made under the Plan. If any such
election is permitted, the Committee shall establish rules and procedures for such deferrals. 

  

	24.	MISCELLANEOUS. 

  

	24.1	EMPLOYMENT RIGHTS.    Neither the Plan nor any action taken hereunder shall be construed as giving any Employee the right to participate under the Plan. Nothing
in this Plan shall be construed as conferring upon any Employee any right with respect to continuation of employment with the Company, nor shall it interfere in any way with such Employee’s right or the Company’s right to terminate his or
her employment at any time, with or without notice and with or without cause. 

  

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	24.2	NO TRUST OR FUND CREATED.    Neither the Plan nor any grant made hereunder shall create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Company and any recipient of a grant of an Award or any other person. To the extent that any person acquires a right to receive payments from the Company pursuant to a grant under the Plan, such right shall be no
greater than the right of any unsecured general creditor of the Company. Nothing herein shall prevent or prohibit the Company from establishing a trust or other arrangement for the purpose of providing for the payment of the benefits payable under
the Plan. 

  

	24.3	FEES AND COSTS.    The Company shall pay all original issue taxes on the exercise of any Award granted under the Plan and all other fees and expenses necessarily
incurred by the Company in connection therewith. 

  

	24.4	EMPLOYEES BASED OUTSIDE THE UNITED STATES.    Notwithstanding any provision of the Plan to the contrary, in order to comply with the laws in other countries in
which the Company, its Affiliates, and its Subsidiaries operate or have Employees, the Committee, in their sole discretion, shall have the power and authority to: 

  

	 	24.4.1	Determine which Affiliates and Subsidiaries shall be covered by the Plan; 

  

	 	24.4.2	Determine which Employees outside the United States are eligible to participate in the Plan; 

  

	 	24.4.3	Modify the terms and conditions of any Award granted to Employees outside the United States to comply with applicable foreign laws; 

  

	 	24.4.4	Establish subplans and modify exercise procedures, and other terms and procedures to the extent such actions may be necessary or advisable. Any subplans and modifications to Plan
terms and procedures established under this Section by the Committee shall be attached to this Plan document as Appendices; and 

  

	 	24.4.5	Take any action, before or after an Award is made, that it deems advisable to obtain approval or comply with any necessary local government regulatory exemptions or approvals.

  

	24.5	OTHER PROVISIONS.    As used in the Plan, and in Award Letters and other documents prepared in implementation of the Plan, references to the masculine pronoun
shall be deemed to refer to the feminine or neuter, and references in the singular or the plural shall refer to the plural or the singular, as the identity of the person or persons or entity or entities being referred to may require. The captions
used in the Plan and in such Awards and other documents prepared in implementation of the Plan are for convenience only and shall not affect the meaning of any provision hereof or thereof. 

  

	25.	EFFECTIVENESS OF THE PLAN.    The Plan shall be submitted to the Company’s shareholders for approval and shall become effective on the date of shareholder
approval. 

  

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