Document:

exhibit101

Execution Version    [  ]  April 8, 2021  To:  Progress Software Corporation    14 Oak Park   Bedford, Massachusetts 01730   Attention: Anthony Folger, CFO   Telephone No.: (781) 280-4000   Email: anthony.folger@progress.com  Re:  Base Call Option Transaction  The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and conditions of the  call option transaction entered into between [  ] (“Dealer”) and Progress Software Corporation (“Counterparty”) as  of the Trade Date specified below (the “Transaction”). This letter agreement constitutes a “Confirmation” as  referred to in the ISDA Master Agreement specified below. Each party further agrees that this Confirmation together  with the Agreement evidence a complete binding agreement between Counterparty and Dealer as to the subject  matter and terms of the Transaction to which this Confirmation relates, and shall supersede all prior or  contemporaneous written or oral communications with respect thereto.  The definitions and provisions contained in the 2002 ISDA Equity Derivatives Definitions (the “Equity  Definitions”), as published by the International Swaps and Derivatives Association, Inc. (“ISDA”) are incorporated  into this Confirmation.  In the event of any inconsistency between the Equity Definitions and this Confirmation, this  Confirmation shall govern.  Certain defined terms used herein are based on terms that are defined in the Offering  Memorandum, dated April 8, 2021 (the “Offering Memorandum”), relating to the 1.00% Convertible Senior Notes  due 2026 (as originally issued by Counterparty, the “Convertible Notes” and each USD 1,000 principal amount of  Convertible Notes, a “Convertible Note”) issued by Counterparty in an aggregate initial principal amount of USD  325,000,000 (as increased by up to an aggregate principal amount of USD 50,000,000 if and to the extent that the  Initial Purchasers (as defined herein) exercise their option to purchase additional Convertible Notes pursuant to the  Purchase Agreement (as defined herein)), pursuant to an Indenture to be dated April 13, 2021 between Counterparty  and U.S. Bank, National Association, as trustee (the “Indenture”).  In the event of any inconsistency between the  terms defined in the Offering Memorandum, the Indenture and this Confirmation, this Confirmation shall govern.   The parties acknowledge that this Confirmation is entered into on the date hereof with the understanding that (i)  definitions set forth in the Indenture which are also defined herein by reference to the Indenture and (ii) sections of  the Indenture that are referred to herein will conform to the descriptions thereof in the Offering Memorandum.  If  any such definitions in the Indenture or any such sections of the Indenture differ from the descriptions thereof in the  Offering Memorandum, the descriptions thereof in the Offering Memorandum will govern for purposes of this  Confirmation.  The parties further acknowledge that the Indenture section numbers used herein are based on the  draft of the Indenture last reviewed by Dealer as of the date of this Confirmation, and if any such section numbers  are changed in the Indenture as executed, the parties will amend this Confirmation in good faith to preserve the  intent of the parties.  Subject to the foregoing, references to the Indenture herein are references to the Indenture as in  effect on the date of its execution, and if the Indenture is amended or supplemented following such date (other than  any amendment or supplement (x) pursuant to Section 8.01(I) of the Indenture that, as determined by the Calculation  Agent, conforms the Indenture to the description of Convertible Notes in the Offering Memorandum or (y) pursuant  to Section 5.09 of the Indenture, subject, in the case of this clause (y), to the second paragraph under “Method of  Adjustment” in Section 3), any such amendment or supplement will be disregarded for purposes of this  Confirmation (other than as provided in Section 10(i)(iv) below) unless the parties agree otherwise in writing.  For  the purposes of the Equity Definitions, the Transaction shall be deemed to be a Share Option Transaction.   Each party is hereby advised, and each such party acknowledges, that the other party has engaged in, or  refrained from engaging in, substantial financial transactions and has taken other material actions in reliance upon  the parties’ entry into the Transaction to which this Confirmation relates on the terms and conditions set forth below.  1. This Confirmation evidences a complete and binding agreement between Dealer and Counterparty as to the  terms of the Transaction to which this Confirmation relates.  This Confirmation shall supplement, form a  part of, and be subject to an agreement in the form of the 2002 ISDA Master Agreement (the  “Agreement”) as if Dealer and Counterparty had executed an agreement in such form on the Trade Date  but without any Schedule except for:  

 

2  (a) the election of the laws of the State of New York as the governing law (without reference to  choice of law doctrine) and the election of USD as the Termination Currency;   (b) [(i) the election of an executed guarantee of [Dealer’s ultimate parent] (“Guarantor”) dated as of  the Trade Date in substantially the form attached hereto as Schedule I as a Credit Support  Document and (ii) the election of Guarantor as Credit Support Provider in relation to Dealer;] and  (c) (i) the election that the “Cross Default” provisions of Section 5(a)(vi) of the Agreement shall  apply to Dealer with a “Threshold Amount” of three percent of the shareholders’ equity of  [Dealer][Dealer’s ultimate parent] as of the Trade Date; provided that “Specified Indebtedness”  shall not include obligations in respect of deposits received in the ordinary course of Dealer’s  banking business, (ii) the phrase “or becoming capable at such time of being declared” shall be  deleted from clause (1) of such Section 5(a)(vi) and (iii) the following language shall be added to  the end thereof “Notwithstanding the foregoing, a default under subsection (2) hereof shall not  constitute an Event of Default if (x) the default was caused solely by error or omission of an  administrative or operational nature; (y) funds were available to enable the party to make the  payment when due; and (z) the payment is made within two Local Business Days of such party’s  receipt of written notice of its failure to pay.”   In the event of any inconsistency between provisions of the Agreement and this Confirmation, this  Confirmation will prevail for the purpose of the Transaction to which this Confirmation relates.  The parties  hereby agree that no transaction other than the Transaction to which this Confirmation relates shall be  governed by the Agreement.  If there exists any ISDA Master Agreement between Dealer and Counterparty  or any confirmation or other agreement between Dealer and Counterparty pursuant to which an ISDA  Master Agreement is deemed to exist between Dealer and Counterparty, then notwithstanding anything to  the contrary in such ISDA Master Agreement, such confirmation or agreement or any other agreement to  which Dealer and Counterparty are parties, the Transaction shall not be considered a Transaction under, or  otherwise governed by, such existing or deemed ISDA Master Agreement.  2. The terms of the particular Transaction to which this Confirmation relates are as follows:  General Terms.  Trade Date: April 8, 2021  Effective Date: The Trade Date, subject to Section 10(w) below  Option Style: “Modified American”, as described under “Procedures for  Exercise” below  Option Type: Call  Buyer: Counterparty  Seller: Dealer  Shares: The common stock of Counterparty, par value USD 0.01  per share (Exchange symbol: “PRGS”).  Number of Options: 325,000.  For the avoidance of doubt, the Number of  Options shall be reduced by any Options exercised by  Counterparty.  In no event will the Number of Options be  less than zero.  Applicable Percentage: [  ]%  Option Entitlement: A number equal to the product of the Applicable  Percentage and 17.4525.  Strike Price: USD 57.2984  

 

3  Cap Price: USD 89.8800  Premium:  USD [  ]   Premium Payment Date:  April 13, 2021  Exchange:  The Nasdaq Global Select Market  Related Exchange(s):  All Exchanges  Excluded Provisions: Section 5.06 and Section 5.07 of the Indenture.  Procedures for Exercise.  Conversion Date: With respect to any conversion of a Convertible Note  (other than any conversion of Convertible Notes with a  Conversion Date occurring prior to the Free  Convertibility Date (any such conversion, an “Early  Conversion”), to which the provisions of 10(i)(i) of this  Confirmation shall apply), the date on which the Holder  (as such term is defined in the Indenture) of such  Convertible Note satisfies all of the requirements for  conversion thereof as set forth in Section 5.02 of the  Indenture; provided that if Counterparty has not delivered  to Dealer a related Notice of Exercise, then in no event  shall a Conversion Date be deemed to occur hereunder  (and no Option shall be exercised or deemed to be  exercised hereunder) with respect to any surrender of a  Convertible Note for conversion in respect of which  Counterparty has elected to designate a financial  institution for exchange in lieu of conversion of such  Convertible Note pursuant to Section 5.08 of the  Indenture.  Free Convertibility Date: January 15, 2026  Expiration Time:  The Valuation Time  Expiration Date:  April 15, 2026, subject to earlier exercise.  Multiple Exercise: Applicable, as described under “Automatic Exercise upon  Conversion” and “Notice of Exercise” below.  Automatic Exercise upon Conversion:  Notwithstanding Section 3.4 of the Equity Definitions, on  each Conversion Date occurring on or after the Free  Convertibility Date in respect of which a Notice of  Conversion that is effective as to Counterparty has been  delivered by the relevant converting Holder, a number of  Options equal to the number of Convertible Notes in  denominations of USD 1,000 as to which such  Conversion Date has occurred shall be deemed to be  automatically exercised; provided that such Options shall  be exercised or deemed exercised only if Counterparty  has provided a Notice of Exercise to Dealer in accordance  with “Notice of Exercise” below.   Notwithstanding the foregoing, in no event shall the  number of Options that are exercised or deemed exercised  hereunder exceed the Number of Options.  

 

4  Notice of Exercise: Notwithstanding anything to the contrary in the Equity  Definitions or under “Automatic Exercise upon  Conversion” above, in order to exercise any Options (a)  relating to Convertible Notes with a Conversion Date  occurring on or after the Free Convertibility Date or  (b) that remain outstanding following a Repayment Event  (as defined below) other than the repurchase of any  Convertible Notes by Counterparty pursuant to Section  4.02 of the Indenture or Section 4.03 of the Indenture (any  Options described in this clause (b), “Repayment  Options”), Counterparty must notify Dealer in writing  (which, for the avoidance of doubt, may be by email)  before 5:00 p.m. (New York City time) on the Scheduled  Valid Day immediately preceding the Expiration Date  specifying the number of such Options; provided that if  the Relevant Settlement Method for such Options is (x)  Net Share Settlement and the Specified Cash Amount (as  defined below) is not USD 1,000, (y) Cash Settlement or  (z) Combination Settlement, Counterparty shall provide  Dealer a separate notice (the “Notice of Final Settlement  Method”) (which, for the avoidance of doubt, may be by  email) in respect of all such Convertible Notes before  5:00 p.m. (New York City time) on the Free  Convertibility Date specifying (1) the Relevant Settlement  Method for such Options, and (2) if the settlement method  for the related Convertible Notes is not Settlement in  Cash (as defined below), the fixed amount of cash per  Convertible Note that Counterparty has elected to deliver  to Holders (as such term is defined in the Indenture) of  the related Convertible Notes (the “Specified Cash  Amount”) and if Counterparty fails to timely provide  such Notice of Final Settlement Method, it shall be  deemed to have provided a Notice of Final Settlement  Method indicating that the Relevant Settlement Method is  Net Share Settlement and that the settlement method for  the related Convertible Notes is a combination of cash  and shares with a Specified Cash Amount of USD 1,000.  Counterparty acknowledges its responsibilities under  applicable securities laws, and in particular Section 9 and  Section 10(b) of the Exchange Act (as defined below) and  the rules and regulations thereunder, in respect of any  election of a settlement method with respect to the  Convertible Notes that is not Net Share Settlement with a  Specified Cash Amount of USD1,000 that applies  pursuant to Section 5.03(A) of the Indenture.  Valuation Time: At the close of trading of the regular trading session on  the Exchange; provided that if the principal trading  session is extended, the Calculation Agent shall determine  the Valuation Time in its commercially reasonable  discretion.  Market Disruption Event: Section 6.3(a) of the Equity Definitions is hereby replaced  in its entirety by the following:   “‘Market Disruption Event’ means, in respect of a Share,  (i) a failure by the primary United States national or  regional securities exchange or market on which the  

 

5  Shares are then listed, or if the Shares are not then listed  on a United States national or regional securities  exchange, the principal other market on which the Shares  are then traded, to open for trading during its regular  trading session or (ii) the occurrence or existence, for  more than one half-hour period in the aggregate, of any  suspension or limitation imposed on trading (by reason of  movements in price exceeding limits permitted by the  relevant stock exchange or otherwise) in the Shares or in  any options contracts or futures contracts relating to the  Shares, and such suspension or limitation occurs or exists  at any time before 1:00 p.m. (New York City time) on any  Scheduled Valid Day.”  Settlement Terms.    Settlement Method: For any Option, Net Share Settlement; provided that if the  Relevant Settlement Method set forth below for such  Option is not Net Share Settlement, then the Settlement  Method for such Option shall be such Relevant Settlement  Method, but only if Counterparty shall have notified  Dealer of the Relevant Settlement Method in the Notice  of Final Settlement Method for such Option.  Relevant Settlement Method: In respect of any Option:  (i) if Counterparty has elected to settle its conversion  obligations in respect of the related Convertible Note in a  combination of cash and Shares pursuant to Section  5.03(B)(i)(2) of the Indenture with a Specified Cash  Amount equal to USD 1,000, then, in each case, the  Relevant Settlement Method for such Option shall be Net  Share Settlement;  (ii) if Counterparty has elected to settle its conversion  obligations in respect of the related Convertible Note in a  combination of cash and Shares pursuant to Section  5.03(B)(i)(2) of the Indenture with a Specified Cash  Amount greater than USD 1,000, then the Relevant  Settlement Method for such Option shall be Combination  Settlement; and  (iii) if Counterparty has elected to settle its conversion  obligations in respect of the related Convertible Note  entirely in cash pursuant to Section 5.03(B)(i)(1) of the  Indenture (such settlement method, “Settlement in  Cash”), then the Relevant Settlement Method for such  Option shall be Cash Settlement.  Notwithstanding the foregoing, the Relevant Settlement  Method for any Repayment Options exercised pursuant to  “Notice of Exercise” above shall be Net Share Settlement  or such other Settlement Method notified by Counterparty  to Dealer in the Notice of Final Settlement Method and, if  such Relevant Settlement Method is not Settlement in  Cash or Net Share Settlement, the Specified Cash Amount  for such Repayment Options shall be deemed to be the  amount identified in the Notice of Final Settlement  Method.  

 

6  Net Share Settlement: If Net Share Settlement is applicable to any Option  exercised or deemed exercised hereunder, Dealer will  deliver to Counterparty, on the relevant Settlement Date  for each such Option, a number of Shares (the “Net Share  Settlement Amount”) equal to the sum, for each Valid  Day during the Settlement Averaging Period for each  such Option, of (i) (a) the Daily Option Value for such  Valid Day, divided by (b) the Relevant Price on such  Valid Day, divided by (ii) the number of Valid Days in the  Settlement Averaging Period; provided that in no event  shall the Net Share Settlement Amount for any Option  that is not a Repayment Option exceed a number of  Shares equal to the Applicable Limit for such Option  divided by the Applicable Limit Price on the Settlement  Date for such Option.   Dealer will pay cash in lieu of delivering any fractional  Shares to be delivered with respect to any Net Share  Settlement Amount valued at the Relevant Price for the  last Valid Day of the Settlement Averaging Period.  Combination Settlement: If Combination Settlement is applicable to any Option  exercised or deemed exercised hereunder, Dealer will pay  or deliver, as the case may be, to Counterparty, on the  relevant Settlement Date for each such Option:  (i) cash (the “Combination Settlement Cash  Amount”) equal to the sum, for each Valid Day  during the Settlement Averaging Period for such  Option, of (A) an amount (the “Daily  Combination Settlement Cash Amount”) equal  to the lesser of (1) the product of (x) the Applicable  Percentage and (y) the Specified Cash Amount  minus USD 1,000 and (2) the Daily Option Value,  divided by (B) the number of Valid Days in the  Settlement Averaging Period; provided that if the  calculation in clause (A) above results in zero or a  negative number for any Valid Day, the Daily  Combination Settlement Cash Amount for such  Valid Day shall be deemed to be zero; and  (ii) Shares (the “Combination Settlement Share  Amount”) equal to the sum, for each Valid Day  during the Settlement Averaging Period for such  Option, of a number of Shares for such Valid Day  (the “Daily Combination Settlement Share  Amount”) equal to (A) (1) the Daily Option Value  on such Valid Day minus the Daily Combination  Settlement Cash Amount for such Valid Day,  divided by (2) the Relevant Price on such Valid  Day, divided by (B) the number of Valid Days in  the Settlement Averaging Period; provided that if  the calculation in sub-clause (A)(1) above results  in zero or a negative number for any Valid Day,  the Daily Combination Settlement Share Amount  for such Valid Day shall be deemed to be zero;  provided that in no event shall the sum of (x) the  Combination Settlement Cash Amount for any  

 

7  Option that is not a Repayment Option and (y) the  Combination Settlement Share Amount for such  Option multiplied by the Applicable Limit Price on  the Settlement Date for such Option, exceed the  Applicable Limit for such Option.   Dealer will pay cash in lieu of delivering any fractional  Shares to be delivered with respect to any Combination  Settlement Share Amount valued at the Relevant Price for  the last Valid Day of the Settlement Averaging Period.  Cash Settlement: If Cash Settlement is applicable to any Option exercised  or deemed exercised hereunder, in lieu of Section 8.1 of  the Equity Definitions, Dealer will pay to Counterparty,  on the relevant Settlement Date for each such Option, an  amount of cash (the “Cash Settlement Amount”) equal  to the sum, for each Valid Day during the Settlement  Averaging Period for such Option, of (i) the Daily Option  Value for such Valid Day, divided by (ii) the number of  Valid Days in the Settlement Averaging Period; provided  that in no event shall the Cash Settlement Amount for any  Option that is not a Repayment Option exceed the  Applicable Limit for such Option.    Daily Option Value: For any Valid Day, an amount equal to (i) the Option  Entitlement on such Valid Day, multiplied by (ii) (A) the  lesser of the Relevant Price on such Valid Day and the  Cap Price, less (B) the Strike Price on such Valid Day;  provided that if the calculation contained in clause (ii)  above results in a negative number, the Daily Option  Value for such Valid Day shall be deemed to be zero.  In  no event will the Daily Option Value be less than zero.  Applicable Limit: For any Option that is not a Repayment Option, an  amount of cash equal to the Applicable Percentage  multiplied by the excess of (i) the aggregate of (A) the  amount of cash, if any, paid to the Holder of the related  Convertible Note upon conversion of such Convertible  Note and (B) the number of Shares, if any, delivered to  the Holder of the related Convertible Note upon  conversion of such Convertible Note multiplied by the  Applicable Limit Price on the Settlement Date for such  Option, over (ii) USD 1,000.  Applicable Limit Price: On any day, the opening price as displayed under the  heading “Op” on Bloomberg page PRGS <equity> (or  any successor thereto).  Valid Day: A day on which (i) there is no Market Disruption Event  and (ii) trading in the Shares generally occurs on the  principal United States national or regional securities  exchange on which the Shares are then listed or, if the  Shares are not then listed on a United States national or  regional securities exchange, on the principal other  market on which the Shares are then traded.  If the Shares  are not so listed or traded, “Valid Day” means a Business  Day.  

 

8  Scheduled Valid Day: A day that is scheduled to be a Valid Day on the principal  United States national or regional securities exchange on  which the Shares are listed or, if the Shares are not then  listed on a United States national or regional securities  exchange, on the principal other market on which the  Shares are then traded.  If the Shares are not so listed or  traded, “Scheduled Valid Day” means a Business Day.  Business Day: Any day other than a Saturday, a Sunday or a day on  which the Federal Reserve Bank of New York is  authorized or required by law or executive order to close  or be closed.  Relevant Price: On any Valid Day, the per Share volume-weighted  average price of the Shares as displayed under the  heading “Bloomberg VWAP” on Bloomberg page PRGS  <equity> AQR (or, if such page is not available, its  equivalent successor page) in respect of the period from  the scheduled open of trading to the scheduled close of  trading of the primary trading session on such Valid Day  (or if such volume-weighted average price is unavailable,  the market value of one Share on such Valid Day, as  determined by the Calculation Agent in a commercially  reasonable manner using, if practicable, a volume- weighted average method).  The Relevant Price will be  determined without regard to after-hours trading or any  other trading outside of the regular trading session.  Settlement Averaging Period: For any Option, the 50 consecutive Valid Days  commencing on, and including, the 51st Scheduled Valid  Day immediately prior to the Expiration Date.  Settlement Date: For any Option, the second Business Day immediately  following the final Valid Day of the Settlement Averaging  Period for such Option.  Settlement Currency: USD  Other Applicable Provisions:  The provisions of Sections 9.1(c), 9.8, 9.9 and 9.11 of the  Equity Definitions will be applicable, except that all  references in such provisions to “Physically-settled” shall  be read as references to “Share Settled”.  “Share Settled”  in relation to any Option means that Net Share Settlement  or Combination Settlement is applicable to that Option.  Representation and Agreement: Notwithstanding anything to the contrary in the Equity  Definitions (including, but not limited to, Section 9.11  thereof), the parties acknowledge that (i) any Shares  delivered to Counterparty shall be, upon delivery, subject  to restrictions and limitations arising from Counterparty’s  status as issuer of the Shares under applicable securities  laws, (ii) Dealer may deliver any Shares required to be  delivered hereunder in certificated form in lieu of delivery  through the Clearance System and (iii) any Shares  delivered to Counterparty may be “restricted securities”  (as defined in Rule 144 under the Securities Act of 1933,  as amended (the “Securities Act”)).  3. Additional Terms applicable to the Transaction.  

 

9  Adjustments applicable to the Transaction:  Potential Adjustment Events: Notwithstanding Section 11.2(e) of the Equity Definitions  (which Section shall not apply for purposes of the  Transaction, except as provided in Section 10(y) below), a  “Potential Adjustment Event” means an occurrence of any  event or condition, as set forth in any Dilution Adjustment  Provision, that would result in an adjustment under the  Indenture to the “Conversion Rate” or the composition of  a “Reference Property Unit” or to any “Last Reported  Sale Price”, “Daily VWAP,” “Daily Conversion Value,”  “Daily Share Amount” or “Daily Cash Amount” (each as  defined in the Indenture).  For the avoidance of doubt,  Dealer shall not have any delivery or payment obligation  hereunder, and no adjustment shall be made to the terms  of the Transaction, on account of (x) any distribution of  cash, property or securities by Counterparty to holders of  the Convertible Notes (upon conversion or otherwise) or  (y) any other transaction in which holders of the  Convertible Notes are entitled to participate, in each case,  in lieu of an adjustment under the Indenture of the type  referred to in the immediately preceding sentence  (including, without limitation, pursuant to the proviso to  the first sentence of Section 5.05(A)(iii)(1) of the  Indenture or the  proviso to the first sentence of Section  5.05(A)(iv) of the Indenture).   Method of Adjustment:  Calculation Agent Adjustment, which means that,  notwithstanding Section 11.2(c) of the Equity Definitions  (which Section shall not apply for purposes of the  Transaction, except as provided in Section 10(y) below),  upon any Potential Adjustment Event, the Calculation  Agent shall make a commercially reasonable adjustment  to any one or more of the Strike Price, the Option  Entitlement, the Relevant Price and/or other applicable  price with respect to the Shares and the composition of  the “Shares” hereunder, in each case, corresponding to the  applicable adjustment required to be made pursuant to the  Indenture.     Notwithstanding the foregoing and “Consequences of  Merger Events / Tender Offers” below:  (i) if the Calculation Agent in good faith disagrees  with any adjustment to the Convertible Notes  that involves an exercise of discretion by  Counterparty or its board of directors (including,  without limitation, pursuant to Section 5.05(H)  of the Indenture, Section 5.09 of the Indenture or  any supplemental indenture entered into  thereunder or in connection with any  proportional adjustment or the determination of  the fair value of any securities, property, rights  or other assets), then in each such case, the  Calculation Agent will determine in good faith  and in a commercially reasonable manner the  adjustment to be made to any one or more of the  Strike Price, Number of Options, Option  

 

10  Entitlement and any other variable relevant to the  exercise, settlement or payment for the  Transaction in a commercially reasonable  manner; provided that, notwithstanding the  foregoing, if any Potential Adjustment Event  occurs during the Settlement Averaging Period  but no adjustment was made to any Convertible  Note under the Indenture because the relevant  Holder (as such term is defined in the Indenture)  was deemed to be a record owner of the  underlying Shares on the related Conversion  Date, then the Calculation Agent shall make a  commercially reasonable adjustment, as  determined by it, to the terms hereof in order to  account for such Potential Adjustment Event;  (ii) in connection with any Potential Adjustment  Event as a result of an event or condition set  forth in Section 5.05(A)(ii) of the Indenture or  Section 5.05(A)(iii) of the Indenture where, in  either case, the period for determining “Y” (as  such term is used in Section 5.05(A)(ii) of the  Indenture) or “SP” (as such term is used in  Section 5.05(A)(iii) of the Indenture), as the case  may be, begins before Counterparty has publicly  announced the event or condition giving rise to  such Potential Adjustment Event, then the  Calculation Agent shall, in good faith and in a  commercially reasonable manner,  have the right  to adjust any variable relevant to the exercise,  settlement or payment for the Transaction as  appropriate to reflect the commercially  reasonable costs (including, but not limited to,  hedging mismatches and market losses) and  expenses incurred by Dealer in connection with  its hedging activities, with such adjustments  made assuming that Dealer maintains  commercially reasonable hedge positions, as a  result of such event or condition not having been  publicly announced prior to the beginning of  such period; and  (iii) if any Potential Adjustment Event is declared  and (a) the event or condition giving rise to such  Potential Adjustment Event is subsequently  amended, modified, cancelled or abandoned,  (b) the “Conversion Rate” (as defined in the  Indenture) is otherwise not adjusted at the time  or in the manner contemplated by the relevant  Dilution Adjustment Provision based on such  declaration or (c) the “Conversion Rate” (as  defined in the Indenture) is adjusted as a result of  such Potential Adjustment Event and  subsequently re-adjusted (each of clauses (a), (b)  and (c), a “Potential Adjustment Event  Change”) then, in each case, the Calculation  Agent shall, in good faith and in a commercially  reasonable manner, have the right to adjust any  

 

11  variable relevant to the exercise, settlement or  payment for the Transaction as appropriate to  reflect the costs (including, but not limited to, for  hedging mismatches and market losses) and  expenses incurred by Dealer in connection with  its hedging activities, with such adjustments  made assuming that Dealer maintains  commercially reasonable hedge positions, as a  result of such Potential Adjustment Event  Change.  Dilution Adjustment Provisions: Sections 5.05(A)(i), (ii), (iii), (iv) and (v) and Section  5.05(H) of the Indenture.  Extraordinary Events applicable to the Transaction:  Merger Events: Applicable; provided that notwithstanding Section 12.1(b)  of the Equity Definitions, a “Merger Event” means the  occurrence of any event or condition set forth in the  definition of “Common Stock Change Event” in Section  5.09(A) of the Indenture.  Tender Offers: Applicable; provided that notwithstanding Section 12.1(d)  of the Equity Definitions, a “Tender Offer” means the  occurrence of any event or condition set forth in Section  5.05(A)(v) of the Indenture.  Consequences of Merger Events /  Tender Offers: Notwithstanding Section 12.2 and Section 12.3 of the  Equity Definitions (which Section shall not apply for  purposes of the Transaction except as provided in  Section 10(y) below), upon the occurrence of a Merger  Event or a Tender Offer, the Calculation Agent shall  make a corresponding adjustment in respect of any  adjustment under the Indenture to any one or more of the  nature of the Shares (in the case of a Merger Event),  Strike Price, Number of Options, Option Entitlement and  any other variable relevant to the exercise, settlement or  payment for the Transaction, subject to the second  paragraph under “Method of Adjustment”; provided,  however, that such adjustment shall be made without  regard to any adjustment to the Conversion Rate pursuant  to any Excluded Provision; provided further that if, with  respect to a Merger Event or a Tender Offer, (i) the  consideration for the Shares includes (or, at the option of  a holder of Shares, may include) shares of an entity or  person that is not a corporation or is not organized under  the laws of the United States, any State thereof or the  District of Columbia or (ii) the Counterparty to the  Transaction following such Merger Event or Tender Offer  will not be a corporation organized under the laws of the  United States, any State thereof or the District of  Columbia, then, in either case, Cancellation and Payment  (Calculation Agent Determination) may apply at Dealer’s  reasonable election; provided further that, for the  avoidance of doubt, adjustments shall be made pursuant  to the provisions set forth above regardless of whether  

 

12  any Merger Event or Tender Offer gives rise to an Early  Conversion.  Consequences of Announcement Events: Modified Calculation Agent Adjustment as set forth in  Section 12.3(d) of the Equity Definitions; provided that,  in respect of an Announcement Event, (w) references to  “Tender Offer” shall be replaced by references to  “Announcement Event” and references to “Tender Offer  Date” shall be replaced by references to “date of such  Announcement Event”, (x) the word “shall” in the second  line shall be replaced with “may (and, if it would be  commercially reasonable to do so, shall)”,  (y) the phrase  “exercise, settlement, payment or any other terms of the  Transaction (including, without limitation, the spread)”  shall be replaced with the phrase “Cap Price (provided  that in no event shall the Cap Price be less than the Strike  Price)” and the words “whether within a commercially  reasonable (as determined by the Calculation Agent)  period of time prior to or after the Announcement Event”  shall be inserted prior to the word “which” in the seventh  line, and (z) for the avoidance of doubt, the Calculation  Agent shall determine, in good faith and in a  commercially reasonable manner, whether the relevant  Announcement Event has had a material economic effect  on the Transaction (and, if so, shall adjust the Cap Price  accordingly to account for such economic effect in a  commercially reasonable manner) on one or more  occasions on or after the date of the Announcement Event  up to, and including, the Expiration Date, any Early  Termination Date and/or any other date of cancellation, it  being understood that any adjustment in respect of an  Announcement Event shall take into account any earlier  adjustment relating to the same Announcement Event and  shall not be duplicative with any other adjustment or  cancellation valuation made pursuant to this  Confirmation, the Equity Definitions or the Agreement;  provided that in no event shall the Cap Price be adjusted  to be less than the Strike Price (subject in all cases to  clause (ii) of Section 12.3(d) of the Equity Definitions).   In making any adjustment the Calculation Agent shall  take into account stock price, volatility, expected  dividends, stock loan rate, liquidity relevant to the Shares  or to the Transaction, and other commercially reasonable  option pricing inputs that the Calculation Agent  determines in a commercially reasonable manner to be  relevant, whether within a commercially reasonable (as  determined by the Calculation Agent) period of time prior  to or after such Announcement Event. An Announcement  Event shall be an “Extraordinary Event” for purposes of  the Equity Definitions, to which Article 12 of the Equity  Definitions is applicable.  Announcement Event: (w) An Announcement Date occurs in respect of a  potential Merger Event (for the avoidance of doubt,  determined without regard to the language in the  definition of “Merger Event” following the definition of  “Reverse Merger” therein) or Tender Offer or any  transaction or event or series of transactions and/or events  

 

13  that, if consummated, would lead to a Merger Event or  Tender Offer (as determined by the Calculation Agent),  (x) Counterparty, a subsidiary, affiliate, agent or  representative of Counterparty makes a public  announcement of an intention to solicit or enter into, or to  explore strategic alternatives or other similar undertaking  that may include a Merger Event, Tender Offer or an  Acquisition Transaction, (y) there occurs a public  announcement by (1) any Valid Third-Party Entity in  respect of the relevant transaction, (2) Counterparty or  (3) any subsidiary, affiliate, agent or representative of  Counterparty, in each case, of any potential acquisition or  disposition by Counterparty and/or its subsidiaries where  the aggregate consideration exceeds 35% of the market  capitalization of Counterparty as of the date of such  announcement (an “Acquisition Transaction”) or (z)  there occurs any subsequent public announcement of a  change to a transaction or intention that is the subject of  an announcement of the type described in clause (w), (x)  or (y) of this sentence (including, without limitation, a  new announcement, whether or not by the same party,  relating to such a transaction or intention or the  announcement of a withdrawal from, or the abandonment  or discontinuation of, such a transaction or intention) (in  each case, whether such announcement (and only if such  announcement) is made by Counterparty, its subsidiary,  affiliate, agent or representative, or a Valid Third-Party  Entity) (any event described in clause (w), (x), (y) or (z),  an “Announcement Event”) as determined by the  Calculation Agent.  For the avoidance of doubt, the  occurrence of an Announcement Event with respect to  any transaction or intention shall not preclude the  occurrence of a later Announcement Event with respect to  such transaction or intention. For purposes of this  definition of “Announcement Event,” each of “Merger  Event” and “Tender Offer” shall mean such term as  defined under Section 10(y) below .  Valid Third-Party Entity: In respect of any potential transaction,  any third party  that the Calculation Agent determines has a bona fide  intent to enter into or consummate such transaction (it  being understood and agreed that in determining whether  such third party has such a bona fide intent, the  Calculation Agent may take into consideration the effect  of the relevant announcement by such third party on the  Shares and/or options relating to the Shares).  Announcement Date: The definition of “Announcement Date” in Section 12.1  of the Equity Definitions is hereby amended by (i)  replacing the words “the first” with “any” and replacing  the words “a firm” with the word “any” in the second and  fourth lines thereof, (ii) replacing the word “leads to the”  with the words “, if completed, would lead to a” in the  third and the fifth lines thereof, (iii) replacing the words  “voting shares” with the word “Shares” in the fifth line  thereof, (iv) inserting the words “by Counterparty, a  subsidiary, affiliate, agent or representative of  Counterparty, or any Valid Third-Party Entity” after the  

 

14  word “announcement” in the second and the fourth lines  thereof and (v) inserting the word “potential” following  the words “in the case of a” at the beginning of clauses (i)  and (ii) therein.  Nationalization, Insolvency or Delisting: Cancellation and Payment (Calculation Agent  Determination); provided that, in addition to the  provisions of Section 12.6(a)(iii) of the Equity  Definitions, it will also constitute a Delisting if the  Exchange is located in the United States and the Shares  are not immediately re-listed, re-traded or re-quoted on  any of the New York Stock Exchange, The Nasdaq  Global Select Market or The Nasdaq Global Market (or  their respective successors); if the Shares are immediately  re-listed, re-traded or re-quoted on any of the New York  Stock Exchange, The Nasdaq Global Select Market or  The Nasdaq Global Market (or their respective  successors), such exchange or quotation system shall  thereafter be deemed to be the Exchange.  Additional Disruption Events:  Change in Law: Applicable; provided that Section 12.9(a)(ii) of the Equity  Definitions is hereby amended by (i) replacing the phrase  “the interpretation” in the third line thereof with the  phrase “, or public announcement of, the formal or  informal interpretation”, (ii) replacing the word “Shares”  where it appears in clause (X) thereof with the words  “Hedge Position”, (iii) replacing the parenthetical  beginning after the word “regulation” in the second line  thereof the words “(including, for the avoidance of doubt  and without limitation, (x) any tax law or (y) adoption,  effectiveness or promulgation of new regulations  authorized or mandated by existing statute)” and (iv)  adding the words “provided that, in the case of clause (Y)  hereof where such determination is based on Dealer’s  policies and procedures, such policies and procedures  have been adopted by Dealer in good faith and are  generally applicable in similar situations and applied in a  non-discriminatory manner;” after the semi-colon in the  last line thereof.  Failure to Deliver: Applicable  Hedging Disruption: Applicable; provided that:  (i) Section 12.9(a)(v) of the Equity Definitions is  hereby amended by (a) inserting the following  words at the end of clause (A) thereof: “in the  manner contemplated by the Hedging Party on the  Trade Date” and (b) inserting the following two  phrases at the end of such Section:   “For the avoidance of doubt, the term “equity price  risk” shall be deemed to include, but shall not be  limited to, stock price and volatility risk. And, for  the further avoidance of doubt, any such  transactions or assets referred to in phrases (A) or  

 

15  (B) above must be available on commercially  reasonable pricing terms.”; and  (ii) Section 12.9(b)(iii) of the Equity Definitions is  hereby amended by inserting in the third line  thereof, after the words “to terminate the  Transaction”, the words “or a portion of the  Transaction affected by such Hedging Disruption”.  Increased Cost of Hedging: Not Applicable  Hedging Party: For all applicable Additional Disruption Events, Dealer.  Following any determination or calculation by Hedging  Party hereunder, upon a written request by Counterparty  (which may be by email), Hedging Party will promptly  (but in any event within five Exchange Business Days)  provide to Counterparty by email to the email address  provided by Counterparty in such written request a report  (in a commonly used file format for the storage and  manipulation of financial data) displaying in reasonable  detail the basis for such determination or calculation  (including any quotations, market data or information  from internal or external sources, and any assumptions  used in making such determination or calculation), it  being understood that in no event will Hedging Party be  obligated to share with Counterparty any proprietary or  confidential data or information or any proprietary or  confidential models used by it in making such  determination or calculation or any information that is  subject to an obligation not to disclose such information.  Determining Party: For all applicable Extraordinary Events, Dealer; provided  that when making any determination or calculation as  “Determining Party,” Dealer shall be bound by the same  obligations relating to required acts of the Calculation  Agent as set forth in Section 1.40 of the Equity  Definitions and this Confirmation as if Determining Party  were the Calculation Agent.   Following any determination or calculation by  Determining Party hereunder, upon a written request by  Counterparty (which may be by email), Determining  Party will promptly (but in any event within five  Exchange Business Days) provide to Counterparty by  email to the email address provided by Counterparty in  such written request a report (in a commonly used file  format for the storage and manipulation of financial data)  displaying in reasonable detail the basis for such  determination or calculation (including any quotations,  market data or information from internal or external  sources, and any assumptions used in making such  determination or calculation), it being understood that in  no event will Determining Party be obligated to share  with Counterparty any proprietary or confidential data or  information or any proprietary or confidential models  used by it in making such determination or calculation or  any information that is subject to an obligation not to  disclose such information.  

 

16  Non-Reliance: Applicable   Agreements and Acknowledgments  Regarding Hedging Activities: Applicable  Additional Acknowledgments: Applicable  4. Calculation Agent.  Dealer; provided that, following the occurrence and  during the continuance of an Event of Default of the type  described in Section 5(a)(vii) of the Agreement with  respect to which Dealer is the sole Defaulting Party,  if  the Calculation Agent fails to timely make any  calculation, adjustment or determination required to be  made by the Calculation Agent hereunder or to perform  any obligation of the Calculation Agent hereunder and  such failure continues for two Exchange Business Days  following notice to the Calculation Agent by  Counterparty of such failure, Counterparty shall have the  right to designate a nationally recognized independent  equity derivatives dealer to replace Dealer as the  Calculation Agent, and the parties shall work in good  faith to execute any appropriate documentation required  by such replacement Calculation Agent.   Following any adjustment, determination or calculation  by the Calculation Agent hereunder, upon a written  request by Counterparty (which may be by email), the  Calculation Agent will promptly (but in any event within  five Exchange Business Days) provide to Counterparty by  email to the email address provided by Counterparty in  such written request a report (in a commonly used file  format for the storage and manipulation of financial data)  displaying in reasonable detail the basis for such  adjustment, determination or calculation (including any  quotations, market data or information from internal or  external sources, and any assumptions used in making  such adjustment, determination or calculation), it being  understood that in no event will the Calculation Agent be  obligated to share with Counterparty any proprietary or  confidential data or information or any proprietary or  confidential models used by it in making such adjustment,  determination or calculation or any information that is  subject to an obligation not to disclose such information.  All calculations and determinations by the Calculation  Agent shall be made in good faith and in a commercially  reasonable manner.  5. Account Details.  (a) Account for payments to Counterparty:  To be provided by Counterparty.  Account for delivery of Shares to Counterparty:  To be provided by Counterparty.  (b) Account for payments to Dealer:  

 

17  [  ]    Account for delivery of Shares from Dealer:  To be provided by Dealer     6. Offices.  (a) The Office of Counterparty for the Transaction is:  Inapplicable, Counterparty is not a Multibranch  Party.  (b) The Office of Dealer for the Transaction is: [  ]  7. Notices.   (a) Address for notices or communications to Counterparty:  To:  Progress Software Corporation    14 Oak Park   Bedford, Massachusetts 01730   Attention: Anthony Folger, CFO   Telephone No.: (781) 280-4000    Email: anthony.folger@progress.com  With a copy to:   Attention: Steve Faberman, Chief Legal Officer   Telephone No.: (781) 280-4473   Email: sfaberma@progress.com    (b) Address for notices or communications to Dealer:  [  ]  8. Representations and Warranties of Counterparty.  Each of the representations and warranties of Counterparty set forth in Section 1 of the Purchase Agreement  (the “Purchase Agreement”) dated as of April 8, 2021 between Counterparty and Citigroup Global  Markets Inc. and J.P. Morgan Securities LLC, as representatives of the Initial Purchasers party thereto (the  “Initial Purchasers”), are true and correct on and as of the Trade Date and the Premium Payment Date and  are hereby deemed to be repeated to Dealer as if set forth herein.  Counterparty hereby further represents  and warrants to Dealer on the date hereof and on and as of the Premium Payment Date (or such other date  as specified below) that:  (a) Counterparty has all necessary corporate power and authority to execute, deliver and perform its  obligations in respect of the Transaction; such execution, delivery and performance have been  duly authorized by all necessary corporate action on Counterparty’s part; and this Confirmation  has been duly and validly executed and delivered by Counterparty and constitutes its valid and  binding obligation, enforceable against Counterparty in accordance with its terms, subject to  applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar  laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general  principles of equity, including principles of commercial reasonableness, good faith and fair  dealing (regardless of whether enforcement is sought in a proceeding at law or in equity) and  except that rights to indemnification and contribution hereunder may be limited by federal or state  securities laws or public policy relating thereto.  (b) In lieu of the representation set forth in Section 3(a)(iii) of the Agreement, neither the execution  and delivery of this Confirmation nor the incurrence or performance of obligations of  Counterparty hereunder will conflict with or result in a breach of the certificate of incorporation or  

 

18  by-laws (or any equivalent documents) of Counterparty, or any applicable law or regulation, or  any order, writ, injunction or decree of any court or governmental authority or agency, or any  agreement or instrument to which Counterparty or any of its subsidiaries is a party or by which  Counterparty or any of its subsidiaries is bound or to which Counterparty or any of its subsidiaries  is subject, or constitute a default under, or result in the creation of any lien under, any such  agreement or instrument.  (c) No consent, approval, authorization, or order of, or filing with, any governmental agency or body  or any court is required in connection with the execution, delivery or performance by Counterparty  of this Confirmation, except such as have been obtained or made and such as may be required  under the Securities Act or state securities laws.  (d) Counterparty is not and, after consummation of the transactions contemplated hereby, will not be  required to register as an “investment company” as such term is defined in the Investment  Company Act of 1940, as amended.  (e) Counterparty is an “eligible contract participant” (as such term is defined in Section 1a(18) of the  Commodity Exchange Act, as amended, other than a person that is an eligible contract participant  under Section 1a(18)(C) of the Commodity Exchange Act).  (f) Counterparty is not, on the date hereof, aware of any material non-public information with respect  to Counterparty or the Shares.  (g) To the knowledge of Counterparty, no state or local (including any non-U.S. jurisdiction’s) law,  rule, regulation or regulatory order applicable to the Shares would give rise to any reporting,  consent, registration or other requirement (including without limitation a requirement to obtain  prior approval from any person or entity) as a result of Dealer or its affiliates owning or holding  (however defined) Shares; provided that Counterparty makes no representation or warranty  regarding any such requirement that is applicable generally to the ownership of, or transactions in,  common equity securities of a U.S. incorporated corporation listed on the Exchange by Dealer or  any of its affiliates solely as a result of it or any of such affiliates being a financial institution or  broker-dealer.  (h) Counterparty (A) is capable of evaluating investment risks independently, both in general and with  regard to all transactions and investment strategies involving a security or securities; (B) will  exercise independent judgment in evaluating the recommendations of any broker-dealer or its  associated persons, unless it has otherwise notified the broker-dealer in writing; and (C) has total  assets of at least USD 50 million.  (i) The assets of Counterparty do not constitute “plan assets” under the Employee Retirement Income  Security Act of 1974, as amended, the Department of Labor Regulations promulgated thereunder  or similar law.  (j) As of and immediately after each of the Trade Date and the Premium Payment Date, (A) the value  of the total assets of Counterparty is greater than the sum of the total liabilities (including  contingent liabilities) and the capital (as such terms are defined in Section 154 and Section 244 of  the General Corporation Law of the State of Delaware) of Counterparty, (B) the capital of  Counterparty is adequate to conduct its business, and its entry into the Transaction will not impair  its capital, (C) Counterparty has the ability to pay its debts and obligations as such debts mature  and does not intend to, and does not believe that it will, incur debt beyond its ability to pay as such  debts mature, (D) Counterparty will be able to continue as a going concern, (E) Counterparty is  not, and will not be, “insolvent” (as such term is defined under Section 101(32) of the U.S.  Bankruptcy Code (Title 11 of the United States Code) (the “Bankruptcy Code”)) and (F)  Counterparty would be able to purchase the Number of Shares with respect to the Transaction in  compliance with the laws of its jurisdiction of incorporation (including the adequate surplus and  capital requirements of Sections 154 and 160 of the General Corporation Law of the State of  Delaware).  

 

19  (k) Counterparty acknowledges that the Transaction may constitute a purchase of its equity securities  or a capital distribution. Counterparty further acknowledges that, pursuant to the provisions of the  Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), the Counterparty will be  required to agree to certain time-bound restrictions on its ability to purchase its equity securities or  make capital distributions if it receives loans, loan guarantees or direct loans (as that term is  defined in the CARES Act) under section 4003(b) of the CARES Act. Counterparty further  acknowledges that it may be required to agree to certain time-bound restrictions on its ability to  purchase its equity securities or make capital distributions if it receives loans, loan guarantees or  direct loans (as that term is defined in the CARES Act) under programs or facilities established by  the Board of Governors of the Federal Reserve System or the U.S. Department of Treasury for the  purpose of providing liquidity to the financial system, and may be required to agree to similar  restrictions under programs or facilities established in the future. Accordingly, Counterparty  represents and warrants that neither it nor any of its subsidiaries has applied for, and throughout  the term of this Transaction shall not apply, for a loan, loan guarantee, direct loan (as that term is  defined in the CARES Act) or other investment, or to receive any financial assistance or relief  (howsoever defined) under any program or facility that (a) is established under applicable law  (whether in existence as of the Trade Date or subsequently enacted, adopted or amended),  including without limitation the CARES Act and the Federal Reserve Act, as amended, and (b)  requires under applicable law (or any regulation, guidance, interpretation or other pronouncement  thereunder), as a condition of such loan, loan guarantee, direct loan (as that term is defined in the  CARES Act), investment, financial assistance or relief, that Counterparty or any of its subsidiaries  agree, attest, certify or warrant that it has not, as of the date specified in such condition,  repurchased, or will not repurchase, any equity security of Counterparty, and that it has not, as of  the date specified in such condition, made a capital distribution or will not make a capital  distribution (collectively, “Restricted Financial Assistance”); provided, that Counterparty may  apply for Restricted Financial Assistance if Counterparty either (a) determines, based on the  advice of outside counsel of national standing, that the terms of the Transaction would not cause  Counterparty to fail to satisfy any condition for application for or receipt or retention of such loan,  loan guarantee, direct loan (as that term is defined in the CARES Act), investment, financial  assistance or relief based on the terms of the program or facility as of the date of such advice or (b)  delivers to Dealer evidence of a waiver or other guidance from a governmental authority with  jurisdiction for such program or facility that the Transaction is permitted under such program or  facility (either by specific reference to the Transaction or by general reference to transactions with  attributes of the Transaction in all relevant respects). Counterparty further represents and warrants  that the Premium is not being paid, in whole or in part, directly or indirectly, with funds received  under or pursuant to any program or facility, including the U.S. Small Business Administration’s  “Paycheck Protection Program”, that (a) is established under applicable law (whether in existence  as of the Trade Date or subsequently enacted, adopted or amended), including without limitation  the CARES Act and the Federal Reserve Act, as amended, and (b) requires under such applicable  law (or any regulation, guidance, interpretation or other pronouncement of a governmental  authority with jurisdiction for such program or facility) that such funds be used for specified or  enumerated purposes that do not include the purchase of this Transaction (either by specific  reference to this Transaction or by general reference to transactions with the attributes of this  Transaction in all relevant respects).  9. Representation and Warranty of the Dealer.   (a) Dealer hereby represents and warrants to Counterparty on the date hereof and on and as of the  Premium Payment Date, that Dealer is an “eligible contract participant” (as such term is defined in  Section 1a(18) of the Commodity Exchange Act, other than a person that is an eligible contract  participant under Section 1a(18)(C) of the Commodity Exchange Act).  10. Other Provisions.  (a) Opinions.  On or prior to the Premium Payment Date, Counterparty shall deliver to Dealer an  opinion of counsel, dated as of the Premium Payment Date, with respect to the matters set forth in  Sections 8(a) through (d) of this Confirmation, subject to customary exceptions and limitations  (and, with respect to absence of conflicts with agreements or instruments, limited to those  

 

20  agreements and instruments filed by Counterparty as exhibits to its Form 10-K filed with the SEC,  as updated by any subsequent filings). Delivery of such opinion to Dealer shall be a condition  precedent for the purpose of Section 2(a)(iii) of the Agreement with respect to each obligation of  Dealer under Section 2(a)(i) of the Agreement.  (b) Repurchase Notices.  Counterparty shall, on any day on which Counterparty effects any  repurchase of Shares, promptly give Dealer a written notice of such repurchase (a “Repurchase  Notice”) on such day if following such repurchase, the number of outstanding Shares as  determined on such day is (i) less than 40.6 million (in the case of the first such notice) or (ii)  thereafter more than 2.9 million less than the number of Shares included in the immediately  preceding Repurchase Notice; provided that Counterparty may provide Dealer advance notice on  or prior to any such day, which may include the maximum number of Shares that may be  repurchased under a repurchase program entered into in reliance or Rule 10b5-1(c) and the  approximate period in which such purchases may occur, to the extent it expects that repurchases  effected on such day may result in an obligation to deliver a Repurchase Notice (and in such case,  any such advance notice shall be deemed a Repurchase Notice to the maximum extent of  repurchases set forth in such advance notice as if Counterparty had executed such repurchases);  provided further that, if such repurchase, or the intention to effect the same, would constitute  material non-public information with respect to Counterparty or the Shares, Counterparty shall  make public disclosure thereof at or prior to delivery of such Repurchase Notice.  Counterparty  agrees to indemnify and hold harmless Dealer and its affiliates and their respective officers,  directors, employees, affiliates, advisors, agents and controlling persons (each, an “Indemnified  Person”) from and against any and all losses (including losses relating to Dealer’s hedging  activities as a consequence of becoming, or of the risk of becoming, a Section 16 “insider”,  including without limitation, any forbearance from hedging activities or cessation of hedging  activities and any losses in connection therewith with respect to the Transaction), claims, damages,  judgments, liabilities and reasonable and documented out-of-pocket expenses (including  reasonable attorney’s fees of one outside counsel in each relevant jurisdiction), joint or several,  which an Indemnified Person may become subject to, as a result of Counterparty’s failure to  provide Dealer with a Repurchase Notice on the day and in the manner specified in this paragraph,  and to reimburse, within 30 days, upon written request, each of such Indemnified Persons for any  reasonable legal or other out-of-pocket expenses incurred (and supported by invoices or other  documentation setting forth in reasonable detail such expenses) in connection with investigating,  preparing for, providing testimony or other evidence in connection with or defending any of the  foregoing.  If any suit, action, proceeding (including any governmental or regulatory  investigation), claim or demand shall be brought or asserted against the Indemnified Person as a  result of Counterparty’s failure to provide Dealer with a Repurchase Notice in accordance with  this paragraph, such Indemnified Person shall promptly notify Counterparty in writing, and  Counterparty, upon request of the Indemnified Person, shall retain counsel reasonably satisfactory  to the Indemnified Person to represent the Indemnified Person and any others Counterparty may  designate in such proceeding and shall pay the reasonable fees and expenses of such counsel  related to such proceeding.  Counterparty shall not be liable to the extent that the Indemnified  Person fails to notify Counterparty within a commercially reasonable period of time after any  action is commenced against it in respect of which indemnity may be sought hereunder (it being  understood that any such notice delivered within 30 calendar days of the commencement of any  such action shall be deemed to have been delivered within a commercially reasonable period of  time for such purpose), but only to the extent that Counterparty is materially prejudiced by such  failure to provide such notice.  In addition, Counterparty shall not have liability for any settlement  of any proceeding contemplated by this paragraph that is effected without its written consent, but  if settled with such consent or if there be a final judgment for the plaintiff, Counterparty agrees to  indemnify any Indemnified Person from and against any loss or liability by reason of such  settlement or judgment.  Counterparty shall not, without the prior written consent of the  Indemnified Person, effect any settlement of any pending or threatened proceeding contemplated  by this paragraph that is in respect of which any Indemnified Person is or could have been a party  and indemnity could have been sought hereunder by such Indemnified Person, unless such  settlement includes an unconditional release of such Indemnified Person from all liability on  claims that are the subject matter of such proceeding on terms reasonably satisfactory to such  Indemnified Person. Counterparty shall not be liable for any losses, claims, damages or liabilities  

 

21  (or expenses relating thereto) of any Indemnified Person that result from the bad faith, gross  negligence, willful misconduct or fraud of such Indemnified Person (in each case, as conclusively  determined by a court of competent jurisdiction in a final and non-appealable judgment).  If the  indemnification provided for in this paragraph is unavailable to an Indemnified Person or  insufficient in respect of any losses, claims, damages or liabilities referred to therein, then  Counterparty hereunder, in lieu of indemnifying such Indemnified Person thereunder, shall  contribute to the amount paid or payable by such Indemnified Person as a result of such losses,  claims, damages or liabilities.  The remedies provided for in this paragraph (b) are not exclusive  and shall not limit any rights or remedies which may otherwise be available to any Indemnified  Person at law or in equity.  The indemnity and contribution agreements contained in this  paragraph shall remain operative and in full force and effect regardless of the termination of the  Transaction.  (c) Regulation M.  Counterparty is not on the Trade Date engaged in a distribution, as such term is  used in Regulation M under the Securities Exchange Act of 1934, as amended (the “Exchange  Act”), of any securities of Counterparty, other than a distribution meeting the requirements of the  exception set forth in Rules 101(b)(10) and 102(b)(7) of Regulation M.  Counterparty shall not,  until the second Scheduled Trading Day immediately following the Effective Date, engage in any  such distribution.  (d) No Manipulation.  Counterparty is not entering into the Transaction to create actual or apparent  trading activity in the Shares (or any security convertible into or exchangeable for the Shares) or to  raise or depress or otherwise manipulate the price of the Shares (or any security convertible into or  exchangeable for the Shares) or otherwise in violation of the Exchange Act.  (e) Transfer or Assignment.    (i)  Counterparty shall have the right to transfer or assign its rights and obligations hereunder  with respect to all, but not less than all, of the Options hereunder (such Options, the  “Transfer Options”); provided that such transfer or assignment shall be subject to  reasonable conditions that Dealer may impose that are generally applicable in similar  situations (if any) and applied in a non-discriminatory manner, including but not limited,  to the following conditions:  (A) With respect to any Transfer Options, Counterparty shall not be released from  its notice and indemnification obligations pursuant to Section (b) or any  obligations under Section (o) or(t) of this Confirmation;  (B) Any Transfer Options shall only be transferred or assigned to a third party that is  a United States person (as defined in the Internal Revenue Code of 1986, as  amended (the “Code”);  (C) Such transfer or assignment shall be effected on terms, including any reasonable  undertakings by such third party (including, but not limited to, an undertaking  with respect to compliance with applicable securities laws in a manner that, in  the reasonable judgment of Dealer, will not expose Dealer to material risks  under applicable securities laws) and execution of any documentation and  delivery of legal opinions with respect to applicable securities laws and other  matters by such third party and Counterparty, as are requested and reasonably  satisfactory to Dealer;  (D) Dealer will not, as a result of such transfer and assignment, be required to pay  the transferee on any payment date an amount under Section 2(d)(i)(4) of the  Agreement greater than an amount that Dealer would have been required to pay  to Counterparty in the absence of such transfer and assignment, nor receive from  the transferee on any payment date an amount under Section 2(d)(i)(4) of the  Agreement that is less than the amount that Dealer would have received from  Counterparty in the absence of such transfer and assignment;  

 

22  (E) An Event of Default, Potential Event of Default or Termination Event will not  occur as a result of such transfer and assignment;  (F) Without limiting the generality of clause (B), Counterparty shall cause the  transferee to make such Payee Tax Representations and to provide such tax  documentation as may be reasonably requested by Dealer to permit Dealer to  determine that results described in clauses (D) and (E) will not occur upon or  after such transfer and assignment; and  (G) Counterparty shall be responsible for all commercially reasonable costs and  expenses, including commercially reasonable counsel fees, incurred by Dealer in  connection with such transfer or assignment.  (ii) Dealer may, (A) without Counterparty’s consent, transfer or assign (a “Transfer”) all or  any part of its rights or obligations under the Transaction to any affiliate or branch of  Dealer (1) that has a rating for its long term, unsecured and unsubordinated indebtedness  that is equal to or better than Dealer’s credit rating at the time of such Transfer, or (2)  whose obligations hereunder will be guaranteed, pursuant to the terms of a customary  guarantee in a form used by Dealer generally for similar transactions by  [Dealer][Dealer’s ultimate parent] or (B) with Counterparty’s consent (which consent will  not be unreasonably withheld) to any other third party with a rating for its long term,  unsecured and unsubordinated indebtedness equal to or better than the lesser of (1) the  credit rating of Dealer at the time of the Transfer and (2) BBB+ by Standard and Poor’s  Rating Group, Inc. or its successor (“S&P”), or Baa1 by Moody’s Investor Service, Inc.  (“Moody’s”) or, if either S&P or Moody’s ceases to rate such debt, at least an equivalent  rating or better by a substitute rating agency mutually agreed by Counterparty and  Dealer; provided that such transferee is an “eligible contract participant” (as such term is  defined in Section 1a(18) of the Commodity Exchange Act, as amended); provided  further that, in the case of a transfer or assignment under (A) or (B) above, (i) under the  applicable law effective on the date of transfer or assignment by Dealer, (1) Counterparty  will not, as a result of such transfer or assignment, be required to pay the transferee or  assignee on any payment date an amount under Section 2(d)(i)(4) of the Agreement  greater than an amount that Counterparty would have been required to pay to Dealer in  the absence of such transfer or assignment, (2) Counterparty will not, as a result of such  transfer or assignment, receive from the transferee or assignee on any payment date an  amount under Section 2(d)(i)(4) of the Agreement that is less than the amount that  Counterparty would have received from Dealer in the absence of such transfer or  assignment and (3) such transfer or assignment would not result in a taxable exchange  from Counterparty’s perspective for U.S. federal income tax purposes; (ii) Dealer shall  cause the transferee to make such Payee Tax Representations and to provide such tax  documentation as may be reasonably requested by Counterparty to permit Counterparty  to determine that the results described in clause (i) of this proviso will not occur upon or  after such transfer or assignment; and (iii) Dealer shall provide prompt written notice to  Counterparty following any such Transfer.  If at any time at which (A) the Section 16  Percentage exceeds 7.5%, (B) the Option Equity Percentage exceeds 14.5%, or (C) the  Share Amount exceeds the Applicable Share Limit (if any applies) (any such condition  described in clauses (A), (B) or (C), an “Excess Ownership Position”), Dealer is unable  after using its commercially reasonable efforts to effect a transfer or assignment of  Options to a third party on pricing terms reasonably acceptable to Dealer and within a  time period reasonably acceptable to Dealer such that (after giving effect to such transfer  or assignment and any resulting change in Dealer’s commercially reasonable Hedge  Positions) no Excess Ownership Position exists, then Dealer may designate any Exchange  Business Day as an Early Termination Date with respect to a portion of the Transaction  (the “Terminated Portion”), such that (after giving effect to such transfer or assignment  and any resulting change in Dealer’s commercially reasonable Hedge Positions)  following such partial termination no Excess Ownership Position exists.  In the event that  Dealer so designates an Early Termination Date with respect to a portion of the  Transaction, a payment shall be made pursuant to Section 6 of the Agreement as if (1) an  

 

23  Early Termination Date had been designated in respect of a Transaction having terms  identical to the Transaction and a Number of Options equal to the number of Options  underlying the Terminated Portion, (2) Counterparty were the sole Affected Party with  respect to such partial termination and (3) the Terminated Portion were the sole Affected  Transaction (and, for the avoidance of doubt, the provisions of Section 10(m) shall apply  to any amount that is payable by Dealer to Counterparty pursuant to this sentence as if  Counterparty was not the Affected Party).  The “Section 16 Percentage” as of any day is  the fraction, expressed as a percentage, (A) the numerator of which is the number of  Shares that Dealer and any of its affiliates or any other person subject to aggregation with  Dealer for purposes of the “beneficial ownership” test under Section 13 of the Exchange  Act, or any “group” (within the meaning of Section 13 of the Exchange Act) of which  Dealer is or may be deemed to be a part beneficially owns (within the meaning of Section  13 of the Exchange Act), without duplication, on such day (or, to the extent that for any  reason the equivalent calculation under Section 16 of the Exchange Act and the rules and  regulations thereunder results in a higher number, such higher number) and (B) the  denominator of which is the number of Shares outstanding on such day.  The “Option  Equity Percentage” as of any day is the fraction, expressed as a percentage, (A) the  numerator of which is the sum of (1) the product of the Number of Options and the  Option Entitlement and (2) the aggregate number of Shares underlying any other call  option transaction sold by Dealer to Counterparty, and (B) the denominator of which is  the number of Shares outstanding on such day.  The “Share Amount” as of any day is the  number of Shares that Dealer and any person whose ownership position would be  aggregated with that of Dealer (Dealer or any such person, a “Dealer Person”) under any  law, rule, regulation, regulatory order or organizational documents or contracts of  Counterparty that are, in each case, applicable to ownership of Shares (“Applicable  Restrictions”), owns, beneficially owns, constructively owns, controls, holds the power  to vote or otherwise meets a relevant definition of ownership under any Applicable  Restriction, as determined by Dealer in its reasonable discretion.  The “Applicable Share  Limit” means a number of Shares equal to (A) the minimum number of Shares that could  reasonably be expected to give rise to reporting or registration obligations (except for any  filing requirements on Form 13F, Schedule 13D or Schedule 13G under the Exchange  Act, in each case, as in effect on the Trade Date) or other requirements (including  obtaining prior approval from any person or entity) of a Dealer Person, or could  reasonably be expected to result in an adverse effect on a Dealer Person, under any  Applicable Restriction, as determined by Dealer in its reasonable discretion, minus (B)  1% of the number of Shares outstanding.  (iii) Notwithstanding any other provision in this Confirmation to the contrary requiring or  allowing Dealer to purchase, sell, receive or deliver any Shares or other securities, or  make or receive any payment in cash, to or from Counterparty, Dealer may designate any  of its affiliates (each, a “Dealer Designated Affiliate”) to purchase, sell, receive or  deliver such Shares or other securities, or to make or receive such payment in cash, and  otherwise to perform Dealer’s obligations in respect of the Transaction and any such  designee may assume such obligations; provided, that, to the extent applicable, such  Dealer Designated Affiliate shall comply with the provisions of the Transaction in the  same manner as Dealer would have been required to comply.  Dealer shall be discharged  of its obligations to Counterparty to the extent such Dealer Designated Affiliate fully  performs the obligations designated by Dealer to such Dealer Designated Affiliate under  this Section (iii).  (f) Staggered Settlement.  If upon advice of counsel with respect to applicable legal and regulatory  requirements, including any requirements relating to Dealer’s commercially reasonable hedging  activities hereunder, Dealer reasonably determines that it would not be practicable or advisable to  deliver, or to acquire Shares to deliver, any or all of the Shares to be delivered by Dealer on any  Settlement Date for the Transaction, Dealer may, by notice to Counterparty on or prior to any  Settlement Date (a “Nominal Settlement Date”), elect to deliver the Shares on two or more dates  (each, a “Staggered Settlement Date”) as follows:  

 

24  (i) in such notice, Dealer will specify to Counterparty the related Staggered Settlement Dates  (each of which will be on or prior to the Nominal Settlement Date) and the number of  Shares that it will deliver on each Staggered Settlement Date;  (ii) the aggregate number of Shares that Dealer will deliver to Counterparty hereunder on all  such Staggered Settlement Dates will equal the number of Shares that Dealer would  otherwise be required to deliver on such Nominal Settlement Date; and  (iii) if the Net Share Settlement terms or the Combination Settlement terms set forth above  were to apply on the Nominal Settlement Date, then the Net Share Settlement terms or  the Combination Settlement terms, as the case may be, will apply on each Staggered  Settlement Date, except that the Shares otherwise deliverable on such Nominal  Settlement Date will be allocated among such Staggered Settlement Dates as specified by  Dealer in the notice referred to in clause (i) above.  (g) [Insert relevant Dealer agency language, if any].  (h) Dividends.  If at any time during the period from and including the Effective Date, to but  excluding the Expiration Date, (i) an ex-dividend date for a regular quarterly cash dividend occurs  with respect to the Shares (an “Ex-Dividend Date”), and that dividend is less than the Regular  Dividend on a per Share basis or (ii) if no Ex-Dividend Date for a regular quarterly cash dividend  occurs with respect to the Shares in any quarterly dividend period of Counterparty, then the  Calculation Agent will adjust the Cap Price to preserve the fair value of the Options after taking  into account such dividend or lack thereof.  “Regular Dividend” shall mean USD 0.175 per Share  per quarter.  Upon any adjustment to the “Dividend Threshold” (as defined in the Indenture) for  the Convertible Notes pursuant to the Indenture, the Calculation Agent will make a corresponding  adjustment to the Regular Dividend for the Transaction.  (i) Additional Termination Events.  (i) Notwithstanding anything to the contrary in this Confirmation, upon any Early  Conversion in respect of which a “Notice of Conversion” (as defined in the Indenture)  that is effective as to Counterparty has been delivered by the relevant converting Holder:  (A) Counterparty shall, within five Scheduled Trading Days of the “Conversion  Date” (as defined in the Indenture) for such Early Conversion, provide written  notice (an “Early Conversion Notice”) to Dealer specifying the number of  Convertible Notes surrendered for conversion on such Conversion Date (such  Convertible Notes, the “Affected Convertible Notes”) and the anticipated  settlement date, and the giving of such Early Conversion Notice shall constitute  an Additional Termination Event as provided in this clause (i);  (B) upon receipt of any such Early Conversion Notice, Dealer shall designate an  Exchange Business Day as an Early Termination Date (which Exchange  Business Day shall correspond to a settlement date in respect of the Affected  Number of Options (as defined below) that occurs on or as promptly as  reasonably practicable after the related conversion settlement date for the  Affected Convertible Notes for such Early Conversion) with respect to the  portion of the Transaction corresponding to a number of Options (the “Affected  Number of Options”) equal to the lesser of (x) the number of Affected  Convertible Notes and (y) the Number of Options as of the Conversion Date for  such Early Conversion;  (C) any payment hereunder with respect to such termination shall be calculated  pursuant to Section 6 of the Agreement as if (x) an Early Termination Date had  been designated in respect of a Transaction having terms identical to the  Transaction and a Number of Options equal to the Affected Number of Options,  (y) Counterparty were the sole Affected Party with respect to such Additional  Termination Event and (z) the terminated portion of the Transaction were the  

 

25  sole Affected Transaction (and, for the avoidance of doubt, the provisions of  Section 10(m) shall apply to any amount that is payable by Dealer to  Counterparty pursuant to this Section 10(i)(i)(C) as if, solely for the purpose of  electing the settlement method, Counterparty were not the Affected Party);  provided that the amount payable with respect to such termination shall not be  greater than (1) the Applicable Percentage, multiplied by (2) the Affected  Number of Options, multiplied by (3) (x) the sum of (i) the amount of cash paid  (if any) and (ii) the number of Shares delivered (if any) to the Holder (as such  term is defined in the Indenture) of an Affected Convertible Note upon  conversion of such Affected Convertible Note, multiplied by the Applicable  Limit Price on the settlement date for the conversion of such Affected  Convertible Note, minus (y) USD 1,000.   (D) for the avoidance of doubt, in determining the amount payable in respect of such  Affected Transaction pursuant to Section 6 of the Agreement, the Calculation  Agent shall assume that (x) the relevant Early Conversion and any conversions,  adjustments, agreements, payments, deliveries or acquisitions by or on behalf of  Counterparty leading thereto had not occurred, (y) no adjustments to the  Conversion Rate have occurred pursuant to any Excluded Provision and (z) the  corresponding Convertible Notes remain outstanding until their final maturity  date; and  (E) the Transaction shall remain in full force and effect, except that, as of the  Conversion Date for such Early Conversion, the Number of Options shall be  reduced by the Affected Number of Options.  (ii) Notwithstanding anything to the contrary in this Confirmation if an event of default with  respect to Counterparty occurs under the terms of the Convertible Notes as set forth in  Section 7.01 of the Indenture and such event of default results in the Convertible Notes  being accelerated and declared due and payable, then such event of default shall  constitute an Additional Termination Event applicable to the Transaction and, with  respect to such Additional Termination Event, (A) Counterparty shall be deemed to be  the sole Affected Party, (B) the Transaction shall be the sole Affected Transaction and  (C) Dealer shall be the party entitled to designate an Early Termination Date pursuant to  Section 6(b) of the Agreement (which Early Termination Date shall be on or as promptly  as reasonably practicable after Dealer becomes aware of the occurrence of such  acceleration).  (iii) Within five Scheduled Trading Days following any Repayment Event (as defined below),  Counterparty (x) in the case of a Repayment Event resulting from the repurchase of any  Convertible Notes by Counterparty pursuant to Section 4.02 of the Indenture or Section  4.03 of the Indenture, shall notify Dealer in writing of such Repayment Event and (y) in  the case of a Repayment Event not described in clause (x) above, may notify Dealer in  writing of such Repayment Event, in each case, including the aggregate principal amount  of Convertible Notes (the “Repayment Convertible Notes”) subject to such Repayment  Event (any such notice, a “Repayment Notice”); provided that no such Repayment  Notice described in clause (y) above shall be effective unless it contains the  representation by Counterparty set forth in Section 8(f) as of the date of such Repayment  Notice. The receipt by Dealer from Counterparty of any Repayment Notice shall  constitute an Additional Termination Event as provided in this Section 10(i)(iii). Upon  receipt of any such Repayment Notice, Dealer shall designate an Exchange Business Day  following receipt of such Repayment Notice as an Early Termination Date with respect to  the portion of the Transaction corresponding to a number of Options (the “Repayment  Options”) equal to the lesser of (A) the aggregate principal amount of such Convertible  Notes specified in such Repayment Notice, divided by USD 1,000, and (B) the Number  of Options as of the date Dealer designates such Early Termination Date and, as of such  date, the Number of Options shall be reduced by the number of Repayment Options. Any  payment hereunder with respect to such termination (the “Repayment Unwind  

 

26  Payment”) shall be calculated pursuant to Section 6 of the Agreement as if (1) an Early  Termination Date had been designated in respect of a Transaction having terms identical  to the Transaction and a Number of Options equal to the number of Repayment Options,  (2) Counterparty were the sole Affected Party with respect to such Additional  Termination Event and (3) the terminated portion of the Transaction were the sole  Affected Transaction; provided that in the event of a Repayment Event pursuant to  Section 4.02 of the Indenture or Section 4.03 of the Indenture, the Repayment Unwind  Payment shall not be greater than (x) the number of Repayment Options multiplied by (y)  the product of (A) the Applicable Percentage and (B) the excess, if any, of (I) the amount  paid by the Counterparty per Convertible Note pursuant to the relevant sections of the  Indenture over (II) USD 1,000.  “Repayment Event” means that (i) any Convertible  Notes are repurchased or redeemed (whether in connection with or as a result of a  fundamental change, howsoever defined, or for any other reason) by Counterparty or any  of its subsidiaries, (ii) any Convertible Notes are delivered to Counterparty or any of its  subsidiaries in exchange for delivery of any property or assets of such party (howsoever  described), (iii) any principal of any of the Convertible Notes is repaid prior to the final  maturity date of the Convertible Notes (for any reason other than as a result of an  acceleration of the Convertible Notes that results in an Additional Termination Event  pursuant to Section 10(i)(ii)), or (iv) any Convertible Notes are exchanged by or for the  benefit of the “Holders” (as defined in the Indenture) thereof for any other securities of  Counterparty or any of its subsidiaries (or any other property, or any combination thereof)  pursuant to any exchange offer or similar transaction.  For the avoidance of doubt, any  conversion of Convertible Notes (whether into cash, Shares, “Reference Property” (as  defined in the Indenture) or any combination thereof) pursuant to the terms of the  Indenture shall not constitute a Repayment Event.  (iv) Notwithstanding anything to the contrary in this Confirmation, the occurrence of an  Amendment Event shall constitute an Additional Termination Event applicable to the  Transaction and, with respect to such Additional Termination Event, (A) Counterparty  shall be deemed to be the sole Affected Party, (B) the Transaction shall be the sole  Affected Transaction and (C) Dealer shall be the party entitled to designate an Early  Termination Date pursuant to Section 6(b) of the Agreement. “Amendment Event”  means that Counterparty amends, modifies, supplements, waives or obtains a waiver in  respect of any term of the Indenture or the Convertible Notes governing the principal  amount, coupon, maturity, repurchase obligation of Counterparty, redemption right of  Counterparty, any term relating to conversion of the Convertible Notes (including  changes to the conversion rate, conversion rate adjustment provisions, conversion  settlement dates or conversion conditions), or any term that would require consent of the  holders of not less than 100% of the principal amount of the Convertible Notes to amend  (other than, in each case, any amendment or supplement (x) pursuant to Section 8.01(I) of  the Indenture that, as determined by the Calculation Agent, conforms the Indenture to the  description of Convertible Notes in the Offering Memorandum or (y) pursuant to Section  5.09 of the Indenture), in each case, without the consent of Dealer (such consent not to be  unreasonably withheld or delayed).  (j) Amendments to Equity Definitions.    (i) Solely in respect of adjustments to the Cap Price pursuant to Section 10(y),  Section 11.2(e)(vii) of the Equity Definitions is hereby amended by deleting the words  “that may have a diluting or concentrative effect on the theoretical value of the relevant  Shares” and replacing them with the words “that is the result of a corporate event  involving the Issuer or its securities that has a material economic effect on the Shares or  options on the Shares; provided that such event is not based on (a) an observable market,  other than the market for Issuer’s own stock or (b) an observable index, other than an  index calculated and measured solely by reference to Issuer’s own operations.”   (i) Section 12.6(a)(ii) of the Equity Definitions is hereby amended by (1) inserting “(1)”  immediately following the word “means” in the first line thereof and (2) inserting  

 

27  immediately prior to the semi-colon at the end of subsection (B) thereof the following  words: “or (2) the occurrence of any of the events specified in Section 5(a)(vii)(1)  through (9) of the ISDA Master Agreement with respect to that Issuer; provided that the  period for dismissal, discharge, stay or restraint therein shall be increased from within 15  days to within 30 days.”  (ii) Without derogating from the provisions of Section 5(b)(i) of the Agreement, Section  12.9(b)(i) of the Equity Definitions is hereby amended by (1) replacing “either party may  elect” with “Dealer may elect” and (2) replacing “notice to the other party” with “notice  to Counterparty” in the first sentence of such section.  (k) Setoff.  Neither party shall have the right to set off any obligation that it may have to the other  party under the Transaction against any obligation such other party may have to it, whether arising  under the Agreement, this Confirmation or any other agreement between the parties hereto, by  operation of law or otherwise and each party hereby waives any such right to setoff.   (l) Adjustments. For the avoidance of doubt, whenever the Hedging Party, Determining Party or  Calculation Agent is required or permitted to make a calculation, adjustment, determination or  election pursuant to the terms of this Confirmation or the Equity Definitions to take into account  the effect of an event (other than on adjustments made by reference to the Indenture), the Hedging  Party, Determining Party or Calculation Agent shall make such adjustment in a commercially  reasonable manner by reference to the effect of such event on Dealer, assuming that Dealer  maintains a commercially reasonable hedge position.   (m) Alternative Calculations and Payment on Early Termination and on Certain Extraordinary  Events.  If (a) an Early Termination Date (whether as a result of an Event of Default or a  Termination Event) occurs or is designated with respect to the Transaction or (b) the Transaction  is cancelled or terminated upon the occurrence of an Extraordinary Event (except as a result of (i)  a Nationalization, Insolvency or Merger Event in which the consideration to be paid to holders of  Shares consists solely of cash, (ii) an Announcement Event, a Merger Event or Tender Offer that  is within Counterparty’s control, or (iii) an Event of Default in which Counterparty is the  Defaulting Party or a Termination Event in which Counterparty is the Affected Party other than an  Event of Default of the type described in Section 5(a)(iii), (v), (vi), (vii) or (viii) of the Agreement  or a Termination Event of the type described in Section 5(b) of the Agreement, in each case that  resulted from an event or events outside Counterparty’s control), and if Dealer would owe any  amount to Counterparty pursuant to Section 6(d)(ii) of the Agreement or any Cancellation Amount  pursuant to Article 12 of the Equity Definitions (any such amount, a “Payment Obligation”), then  Dealer shall satisfy the Payment Obligation by the Share Termination Alternative (as defined  below), unless (a) Counterparty gives irrevocable telephonic notice to Dealer, confirmed in writing  within one Scheduled Trading Day, no later than 12:00 p.m. (New York City time) on the date of  the Announcement Event, Merger Date, Tender Offer Date, Announcement Date (in the case of a  Nationalization, Insolvency or Delisting), Early Termination Date or date of cancellation, as  applicable, of its election that the Share Termination Alternative shall not apply, (b) Counterparty  remakes the representation set forth in Section 8(f) as of the date of such election and (c) Dealer  agrees, in its commercially reasonable discretion, to such election, in which case the provisions of  Section 12.7 or Section 12.9 of the Equity Definitions, or the provisions of Section 6(d)(ii) and  Section 6(e) of the Agreement, as the case may be, shall apply.    Share Termination Alternative: If applicable, Dealer shall deliver to Counterparty the  Share Termination Delivery Property on, or within a  commercially reasonable period of time after, the  date when the relevant Payment Obligation would  otherwise be due pursuant to Section 12.7 or 12.9 of  the Equity Definitions or Section 6(d)(ii) and 6(e) of  the Agreement, as applicable, in satisfaction of such  Payment Obligation in the manner reasonably  requested by Counterparty free of payment.  

 

28  Share Termination Delivery Property:  A number of Share Termination Delivery Units, as  calculated by the Calculation Agent, equal to the  Payment Obligation divided by the Share  Termination Unit Price.  The Calculation Agent shall  adjust the Share Termination Delivery Property by  replacing any fractional portion of a security therein  with an amount of cash equal to the value of such  fractional security based on the values used to  calculate the Share Termination Unit Price.  Share Termination Unit Price:  The value of property contained in one Share  Termination Delivery Unit, as determined by the  Calculation Agent in its reasonable discretion by  commercially reasonable means and notified by the  Calculation Agent to Dealer at the time of  notification of the Payment Obligation.  Share Termination Delivery Unit:  One Share or, if the Shares have changed into cash or  any other property or the right to receive cash or any  other property as the result of a Nationalization,  Insolvency or Merger Event (any such cash or other  property, the “Exchange Property”), a unit  consisting of the type and amount of such Exchange  Property received by a holder of one Share (without  consideration of any requirement to pay cash or other  consideration in lieu of fractional amounts of any  securities) in such Nationalization, Insolvency or  Merger Event, as determined by the Calculation  Agent in a commercially reasonable manner. If such  Nationalization, Insolvency, or Merger Event  involves a choice of Exchange Property to be  received by holders, such holder shall be deemed to  have elected to receive the maximum possible  amount of cash.  Failure to Deliver:  Applicable.  Other Applicable Provisions:  If Share Termination Alternative is applicable, the  provisions of Sections 9.8, 9.9 and 9.11 (as modified  above) of the Equity Definitions and the provisions  set forth opposite the caption “Representation and  Agreement” in Section 2 will be applicable, except  that all references in such provisions to “Physically- settled” shall be read as references to “Share  Termination Settled” and all references to “Shares”  shall be read as references to “Share Termination  Delivery Units”.  “Share Termination Settled” in  relation to the Transaction means that Share  Termination Alternative is applicable to the  Transaction.  (n) Waiver of Jury Trial.  Each party waives, to the fullest extent permitted by applicable law, any  right it may have to a trial by jury in respect of any suit, action or proceeding relating to the  Transaction.  Each party (i) certifies that no representative, agent or attorney of either party has  represented, expressly or otherwise, that such other party would not, in the event of such a suit,  action or proceeding, seek to enforce the foregoing waiver and (ii) acknowledges that it and the  other party have been induced to enter into the Transaction, as applicable, by, among other things,  the mutual waivers and certifications provided herein.  

 

29  (o) Registration.  Counterparty hereby agrees that if, in the good faith reasonable judgment of Dealer,  based on the advice of counsel, the Shares (“Hedge Shares”) acquired by Dealer for the purpose  of effecting a commercially reasonable hedge of its obligations pursuant to the Transaction cannot  be sold in the public market by Dealer without registration under the Securities Act, Counterparty  shall, at its election, either (i) in order to allow Dealer to sell the Hedge Shares in a registered  offering, make available to Dealer an effective registration statement under the Securities Act and  enter into an agreement, in form and substance reasonably satisfactory to Dealer, substantially in  the form of an underwriting agreement customary for a registered secondary offering of a similar  size in respect of a similar issuer; provided, however, that if Dealer, in its sole reasonable  discretion, is not satisfied with access to due diligence materials, the results of its due diligence  investigation, or the procedures and documentation for the registered offering referred to above,  then clause (ii) or clause (iii) of this paragraph shall apply at the election of Counterparty, (ii) in  order to allow Dealer to sell the Hedge Shares in a private placement, enter into a private  placement agreement substantially similar to private placement purchase agreements customary  for private placements of equity securities of a similar size in respect of a similar issuer, in form  and substance reasonably satisfactory to Dealer (in which case, the Calculation Agent shall make  any adjustments to the terms of the Transaction that are necessary, in its commercially reasonable  judgment, to compensate Dealer for any commercially reasonable discount from the public market  price of the Shares incurred on the sale of Hedge Shares in a private placement) provided that no  “comfort letter” or accountants’ consent shall be required to be delivered in connection with any  private placements, or (iii) purchase the Hedge Shares from Dealer at the then-current market  price on such Exchange Business Days, and in the amounts and at such time(s), reasonably  requested by Dealer.  (p) Tax Disclosure.  Effective from the date of commencement of discussions concerning the  Transaction, Counterparty and each of its employees, representatives, or other agents may disclose  to any and all persons, without limitation of any kind, the tax treatment and tax structure of the  Transaction and all materials of any kind (including opinions or other tax analyses) that are  provided to Counterparty relating to such tax treatment and tax structure.  (q) Right to Extend.  Dealer may postpone or add, in whole or in part, any Valid Day or Valid Days  during the Settlement Averaging Period or any other date of valuation, payment or delivery by  Dealer, with respect to some or all of the Options hereunder, if Dealer reasonably determines, in  the case of clause (i), in its commercially reasonable judgment or, in the case of clause (ii), based  on advice of counsel, that such action is reasonably necessary or appropriate (i) to preserve  Dealer’s commercially reasonable hedging or hedge unwind activity hereunder in light of existing  liquidity conditions in the stock loan market or other relevant market or (ii) to enable Dealer to  effect transactions with respect to Shares in connection with its commercially reasonable hedging,  hedge unwind or settlement activity hereunder in a manner that would, if Dealer were  Counterparty or an affiliated purchaser of Counterparty, be in compliance with applicable legal,  regulatory or self-regulatory requirements, or with related policies and procedures adopted by  Dealer in good faith so long as such policies and procedures are generally applicable in similar  situations and applied in a non-discriminatory manner; provided that no such Valid Day or other  date of valuation, payment or delivery may be postponed or added more than 100 Valid Days  after the original Valid Day or other date of valuation, payment or delivery, as the case may be.  (r) Status of Claims in Bankruptcy.  Dealer acknowledges and agrees that this Confirmation is not  intended to convey to Dealer rights against Counterparty with respect to the Transaction that are  senior to the claims of common stockholders of Counterparty in any United States bankruptcy  proceedings of Counterparty; provided that nothing herein shall limit or shall be deemed to limit  Dealer’s right to pursue remedies in the event of a breach by Counterparty of its obligations and  agreements with respect to the Transaction; provided, further that nothing herein shall limit or  shall be deemed to limit Dealer’s rights in respect of any transactions other than the Transaction.  (s) Securities Contract; Swap Agreement.  The parties hereto intend for (i) the Transaction to be a  “securities contract” and a “swap agreement” as defined in the Bankruptcy Code, and the parties  hereto to be entitled to the protections afforded by, among other Sections, Sections 362(b)(6),  362(b)(17), 546(e), 546(g), 555 and 560 of the Bankruptcy Code, (ii) a party’s right to liquidate  

 

30  the Transaction and to exercise any other remedies upon the occurrence of any Event of Default  under the Agreement with respect to the other party to constitute a “contractual right” as described  in the Bankruptcy Code, and (iii) each payment and delivery of cash, securities or other property  hereunder to constitute a “margin payment” or “settlement payment” and a “transfer” as defined in  the Bankruptcy Code.   (t) Notice of Certain Other Events. Counterparty covenants and agrees that:  (i) promptly following the public announcement of the results of any election by the holders  of Shares with respect to the consideration due upon consummation of any Merger Event,  Counterparty shall give Dealer written notice of the weighted average of the types and  amounts of consideration received by holders of Shares upon consummation of such  Merger Event (the date of such notification, the “Consideration Notification Date”);  provided that in no event shall the Consideration Notification Date be later than the date  on which such Merger Event is consummated; and   (A) Counterparty shall give Dealer commercially reasonable advance (but in no event  less than one Exchange Business Day) written notice of the section or sections of the  Indenture and, if applicable, the formula therein, pursuant to which any adjustment will  be made to the Convertible Notes in connection with any Potential Adjustment Event  (other than a Potential Adjustment in respect of the Dilution Adjustment Provisions set  forth in Section 5.05(A)(ii) or Section 5.05(A)(iv) of the Indenture) or Merger Event and  (B) promptly following any such adjustment, Counterparty shall give Dealer written  notice of the details of such adjustment. The “Adjustment Notice Deadline” means (i)  for any Potential Adjustment in respect of the Dilution Adjustment Provision set forth in  Section 5.05(A)(i) of the Indenture, the relevant Ex-Dividend Date (as such term is  defined in the Indenture) or “effective date” (as such term is used in Section 5.05(A)(i) of  the Indenture), as the case may be, (ii) for any Potential Adjustment in respect of the  Dilution Adjustment Provision in the formula set forth in Section 5.05(A)(iii)(1) of the  Indenture, the first Trading Day (as such term is defined in the Indenture) of the period  referred to in the definition of “SP” in such formula, (iii) for any Potential Adjustment in  respect of the Dilution Adjustment Provision in the formula set forth in Section  5.05(A)(iii)(2) of the Indenture, the first Trading Day (as such term is defined in the  Indenture) of the Spin-off Valuation Period (as such term is defined in the Indenture), (iv)  for any Potential Adjustment in respect of the Dilution Adjustment Provision set forth in  Section 5.05(A)(v) of the Indenture, the first Trading Day (as such term is defined in the  Indenture) of the period referred to in the definition of “SP’” in the formula in such  Section, and (v) for any Merger Event, the effective date of such Merger Event (or, if  earlier, the first day of any valuation or similar period in respect of such Merger Event).  (u) Wall Street Transparency and Accountability Act.  In connection with Section 739 of the Wall  Street Transparency and Accountability Act of 2010 (“WSTAA”), the parties hereby agree that  neither the enactment of WSTAA or any regulation under the WSTAA, nor any requirement under  WSTAA or an amendment made by WSTAA, shall limit or otherwise impair either party’s  otherwise applicable rights to terminate, renegotiate, modify, amend or supplement this  Confirmation or the Agreement, as applicable, arising from a termination event, force majeure,  illegality, increased costs, regulatory change or similar event under this Confirmation, the Equity  Definitions incorporated herein, or the Agreement (including, but not limited to, rights arising  from Change in Law, Hedging Disruption, Increased Cost of Hedging, an Excess Ownership  Position, or Illegality (as defined in the Agreement)).  (v) Agreements and Acknowledgements Regarding Hedging. Counterparty understands, acknowledges  and agrees that: (A) at any time on and prior to the Expiration Date, Dealer and its affiliates may  buy or sell Shares or other securities or buy or sell options or futures contracts or enter into swaps  or other derivative securities in order to adjust its hedge position with respect to the Transaction;  (B) Dealer and its affiliates also may be active in the market for Shares other than in connection  with hedging activities in relation to the Transaction; (C) Dealer shall make its own determination  as to whether, when or in what manner any hedging or market activities in securities of  

 

31  Counterparty shall be conducted and shall do so in a manner that it deems appropriate to hedge its  price and market risk with respect to the Relevant Prices; and (D) any market activities of Dealer  and its affiliates with respect to Shares may affect the market price and volatility of Shares, as well  as the Relevant Prices, each in a manner that may be adverse to Counterparty.  (w) Early Unwind. In the event the sale of the “Firm Securities” (as defined in the Purchase  Agreement) is not consummated with the Initial Purchasers for any reason, or Counterparty fails to  deliver to Dealer opinions of counsel as required pursuant to Section 10(a), in each case by 5:00  p.m. (New York City time) on the Premium Payment Date, or such later date as agreed upon by  the parties (the Premium Payment Date or such later date, the “Early Unwind Date”), the  Transaction shall automatically terminate (the “Early Unwind”) on the Early Unwind Date and (i)  the Transaction and all of the respective rights and obligations of Dealer and Counterparty under  the Transaction shall be cancelled and terminated and (ii) each party shall be released and  discharged by the other party from and agrees not to make any claim against the other party with  respect to any obligations or liabilities of the other party arising out of and to be performed in  connection with the Transaction either prior to or after the Early Unwind Date.  Each of Dealer  and Counterparty represents and acknowledges to the other that, upon an Early Unwind, all  obligations with respect to the Transaction shall be deemed fully and finally discharged.  (x) Payment by Counterparty. In the event that, following payment of the Premium, (i) an Early  Termination Date occurs or is designated with respect to the Transaction as a result of a  Termination Event or an Event of Default (other than an Event of Default arising under Section  5(a)(ii) or 5(a)(iv) of the Agreement) and, as a result, Counterparty owes to Dealer an amount  calculated under Section 6(e) of the Agreement, or (ii) Counterparty owes to Dealer, pursuant to  Section 12.7 or Section 12.9 of the Equity Definitions, an amount calculated under Section 12.8 of  the Equity Definitions, such amount shall be deemed to be zero.  (y) Other Adjustments Pursuant to the Equity Definitions.  Notwithstanding anything to the contrary  in this Confirmation, solely for the purpose of adjusting the Cap Price, the terms “Potential  Adjustment Event,” “Merger Event,” and “Tender Offer” shall each have the meanings assigned to  such term in the Equity Definitions (as amended by Section 10(j)(i)); provided that Section 12.1(d)  of the Equity Definitions is hereby amended by replacing “10%” with “20%” in the third line  thereof, and upon the occurrence of a Merger Date, the occurrence of a Tender Offer Date, or  declaration by Counterparty of the terms of any Potential Adjustment Event, respectively, as such  terms are defined in the Equity Definitions, the Calculation Agent shall determine in a  commercially reasonable manner whether such occurrence or declaration, as applicable, has had a  material economic effect on the Transactions and, if so, shall adjust the Cap Price to preserve the  fair value of the Options (including adjustments to account for changes in volatility, expected  dividends, stock loan rate or liquidity relative to the relevant Shares as determined by the  Calculation Agent in a commercially reasonable manner, but, for the avoidance of doubt, solely in  the case of Section 11.2(e)(i), (ii)(A) and (iv), no adjustments will be made to account for changes  in volatility, expected dividends, stock loan rate or liquidity relative to the relevant Shares);  provided that in no event shall the Cap Price be less than the Strike Price; provided further that, if  no adjustment to the Cap Price will preserve such fair value of the Options, Cancellation and  Payment will be deemed to apply and any payment to be made by one party to the other shall be  calculated in accordance with Section 12.7 of the Equity Definitions, and the Calculation Agent  shall determine the amount of such payment as if “Calculation Agent Determination” applied to  the Option Transaction; provided further that (i) any adjustment to the Cap Price made pursuant to  this Section 10(y) shall be made without duplication of any other adjustment hereunder (including,  for the avoidance of doubt, adjustment made pursuant to the provisions opposite the captions  “Method of Adjustment,” “Consequences of Merger Events / Tender Offers” and “Consequence of  Announcement Events” in Section 3 above); provided further that any Share repurchases by  Counterparty, whether pursuant to Rule 10b-18 of the Exchange Act, Rule 10b5-1 of the  Exchange Act or pursuant to forward contracts or accelerated stock repurchase contracts or similar  derivatives transactions on customary terms, at prevailing market prices, volume-average weighted  prices or discounts thereto shall not be considered Potential Adjustment Events, to the extent that  (I) such Share repurchases are pursuant to the Concurrent Repurchase (as defined below), or (II) in  respect of Share repurchases other than the Concurrent Repurchase, (A) the aggregate number of  

 

32  Shares so repurchased during the term of the Transaction would not exceed 25% of the number of  Shares outstanding as of the Trade Date and (B) the aggregate number of Shares so repurchased  during any calendar year would not exceed 15% of the number of Shares outstanding as of the  Trade Date, in each case as determined by Calculation Agent. “Concurrent Repurchase” means  the repurchase by Counterparty of an aggregate of up to 445,037 Shares on or around the Premium  Payment Date in connection with the offering of the Convertible Notes.  (z) Reserved.  (aa) Risk Disclosure Statement. Counterparty represents and warrants that it has received, read and  understands the OTC Options Risk Disclosure Statement provided by Dealer and a copy of the  most recent disclosure pamphlet prepared by The Options Clearing Corporation entitled  “Characteristics and Risks of Standardized Options”.  (bb) Delivery of Tax Certificates. For purposes of Section 4(a)(i) and (ii) of the Agreement,  Counterparty shall have delivered to Dealer a properly completed Internal Revenue Service Form  W-9 (or successor thereto) and Dealer agrees to deliver to Counterparty a complete and duly  executed Internal Revenue Service Form W-[9][8ECI] “Certificate of Foreign Person’s Claim  That Income Is Effectively Connected With the Conduct of a Trade or Business in the United  States” (or successor thereto). Such forms shall be delivered (i) upon execution and delivery of  this Confirmation, (ii) upon reasonable request by the other party and (iii) promptly upon learning  that any such tax form previously provided by it has become obsolete or incorrect.   (cc) Withholding Tax Imposed on Payments to Non-U.S. Counterparties under the United States  Foreign Account Tax Compliance Act. “Indemnifiable Tax”, as defined in Section 14 of the  Agreement, shall not include any U.S. federal withholding tax imposed or collected pursuant to  FATCA (a “FATCA Withholding Tax”). “FATCA” is defined as Sections 1471 through 1474 of  the Code, any current or future regulations or official interpretations thereof, any agreement  entered into pursuant to Section 1471(b) of the Code, or any fiscal or regulatory legislation, rules  or practices adopted pursuant to any intergovernmental agreement entered into in connection with  the implementation of such Sections of the Code. For the avoidance of doubt, a FATCA  Withholding Tax is a Tax the deduction or withholding of which is required by applicable law for  the purposes of Section 2(d) of the Agreement.   (dd) Incorporation of ISDA 2015 Section 871(m) Protocol Provisions. To the extent that either party to  the Agreement with respect to this Transaction is not an adhering party to the ISDA 2015 Section  871(m) Protocol published by the International Swaps and Derivatives Association, Inc. on  November 2, 2015 and available at www.isda.org, as may be amended, supplemented, replaced or  superseded from time to time (the “871(m) Protocol”), the parties agree that the provisions and  amendments contained in the Attachment to the 871(m) Protocol are incorporated into and apply  to the Agreement with respect to this Transaction as if set forth in full herein. The parties further  agree that, solely for purposes of applying such provisions and amendments to the Agreement with  respect to this Transaction, references to “each Covered Master Agreement” in the 871(m)  Protocol will be deemed to be references to the Agreement with respect to this Transaction, and  references to the “Implementation Date” in the 871(m) Protocol will be deemed to be references to  the Trade Date of this Transaction.  (ee) Payee Tax Representations. For purposes of Section 3(f) of the Agreement, each party makes the  following representations, as applicable:  Counterparty represents that it is a “U.S. person” (as that term is used in Section 1.1441-4(a)(3)(ii)  of United States Treasury Regulations), a corporation for U.S. federal income tax purposes and an  exempt recipient under Section 1.6049-4(c)(l)(ii) of the United States Treasury Regulations.   Dealer represents that it is a is a [  ].      

 

    [Signature Page to Base Capped Call Confirmation]  Counterparty hereby agrees to check this Confirmation and to confirm that the foregoing correctly sets  forth the terms of the Transaction by signing in the space provided below and returning to Dealer the fully executed  Confirmation via e-mail.  Very truly yours,    [  ]    By:     Name:  Title:    Accepted and confirmed  as of the Trade Date:  Progress Software Corporation  By:   Authorized Signatory  Name:EX-10.1

 Exhibit 10.1 

LONESTAR RESOURCES US INC. 

2021 MANAGEMENT INCENTIVE PLAN 

ARTICLE I. 
 PURPOSE

 The Plan’s purpose is to enhance the Company’s ability to attract, retain and motivate persons who make (or are expected to
make) important contributions to the Company by providing these individuals with equity ownership and other incentive opportunities. Capitalized terms used in the Plan are defined in Article XI. 

ARTICLE II. 
 ELIGIBILITY

 Service Providers are eligible to be granted Awards under the Plan, subject to the limitations described herein. 

ARTICLE III. 

ADMINISTRATION AND DELEGATION 

3.1 Administration. The Plan is administered by the Administrator. The Administrator has authority to determine which Service Providers
receive Awards, grant Awards, and set Award terms and conditions, subject to the conditions and limitations in the Plan. The Administrator also has the authority to take all actions and make all determinations under the Plan, to interpret the Plan
and Award Agreements and to adopt, amend and repeal Plan administrative rules, guidelines, and practices as it deems advisable. The Administrator may correct defects and ambiguities, supply omissions and reconcile inconsistencies in the Plan or any
Award as it deems necessary or appropriate to administer the Plan and any Awards. The Administrator’s determinations under the Plan are in its sole discretion and will be final and binding on all persons having or claiming any interest in the
Plan or any Award. 
 3.2 Appointment of Committees. To the extent Applicable Laws permit, the Board may delegate any or all of its
powers under the Plan to one or more Committees or officers of the Company or any of its Subsidiaries. The Board may abolish any Committee or re-vest in itself any previously delegated authority at any time.

 ARTICLE IV. 
 STOCK
AVAILABLE FOR AWARDS 
 4.1 Number of Shares. Subject to adjustment under Article VIII and the terms of this
Article IV, Awards may be made under the Plan covering up to the Overall Share Limit. Shares issued under the Plan may consist of authorized but unissued Shares, Shares purchased on the open market or treasury Shares. 

4.2 Share Recycling. If all or any part of an Award expires, lapses or is terminated, surrendered, repurchased, canceled without having
been fully exercised or forfeited, in any case, in a manner that results in the Company acquiring Shares covered by the Award at a price not greater than the price (as adjusted to reflect any Equity Restructuring) paid by the Participant for such
Shares or not issuing any Shares covered by the Award, the unused Shares covered by the Award will, as applicable, become or again be available for Award grants under the Plan. Awards exchanged for cash shall not again be available

 
for Award under the Plan. The payment of Dividend Equivalents in cash in conjunction with any outstanding Awards shall not count against the Overall Share Limit. Notwithstanding anything to the
contrary contained herein, Shares subject to an Award under the Plan shall not again be made available for issuance or delivery under the Plan if such Shares are delivered (either by actual delivery or attestation) to the Company by a
Participant to satisfy any applicable tax withholding obligation (including Shares retained by the Company from an Award upon exercise or vesting thereof to in connection with such tax withholding obligation). 

4.3 Incentive Stock Option Limitations. Notwithstanding anything to the contrary herein, no more than 966,184 Shares may be issued
pursuant to the exercise of Incentive Stock Options. 
 4.4 Substitute Awards. In connection with an entity’s merger or
consolidation with the Company or the Company’s acquisition of an entity’s property or stock, the Administrator may grant Awards in substitution for any options or other stock or stock-based awards granted before such merger or
consolidation by such entity or its affiliate. Substitute Awards may be granted on such terms as the Administrator deems appropriate, notwithstanding limitations on Awards in the Plan. Substitute Awards will not count against the Overall Share Limit
(nor shall Shares subject to a Substitute Award be added to the Shares available for Awards under the Plan as provided above), except that Shares acquired by exercise of substitute Incentive Stock Options will count against the maximum number of
Shares that may be issued pursuant to the exercise of Incentive Stock Options under the Plan. Additionally, in the event that a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines has shares
available under a pre-existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to
the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the Shares authorized for grant under the Plan (and Shares subject to such Awards shall not be added to
the Shares available for Awards under the Plan as provided above); provided that Awards using such available Shares shall not be made after the date awards or grants could have been made under the terms of the
pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not Employees or Directors prior to such acquisition or combination. For the avoidance of doubt,
Substitute Awards shall not be taken into account as part of the Overall Share Limit for purposes of Section 4.5 below. 
 4.5
Grants Upon a Change in Control. Immediately prior to a Change in Control, any remaining unallocated portion of the Overall Share Limit (the “Remaining Share Pool”) shall be granted by the Administrator (i) if the Chief
Executive Officer of the Company (the “CEO”) is still in service at time of a Change in Control, to the CEO in an amount equal to the number of shares in the Remaining Share Pool multiplied by a fraction, the numerator of which is
the number of Restricted Stock Units granted to the CEO in connection with the initial adoption of the Plan by the Company and the denominator of which is the Overall Share Limit, and (ii) to other Employees as determined by the CEO with the
approval of the Administrator. 
 ARTICLE V. 

RESTRICTED STOCK; RESTRICTED STOCK UNITS 

5.1 General. The Administrator may grant Restricted Stock, or the right to purchase Restricted Stock, to any Service Provider, subject
to forfeiture or the Company’s right to repurchase all or part of such shares at their issue price or other stated or formula price from the Participant if conditions the Administrator specifies in the Award Agreement are not satisfied before
the end of the applicable restriction 

  
 2 

 
period or periods that the Administrator establishes for such Award. In addition, the Administrator may grant to Service Providers Restricted Stock Units, which may be subject to vesting and
forfeiture conditions during the applicable restriction period or periods, as set forth in an Award Agreement. The Administrator will determine and set forth in the Award Agreement the terms and conditions for each Restricted Stock and Restricted
Stock Unit Award, subject to the conditions and limitations contained in the Plan. 
 5.2 Restricted Stock. 

(a) Dividends. Participants holding shares of Restricted Stock will be entitled to all ordinary cash dividends paid with respect to
such Shares, unless the Administrator provides otherwise in the Award Agreement. In addition, unless the Administrator provides otherwise, if any dividends or distributions are paid in Shares, or consist of a dividend or distribution to holders of
Common Stock of property other than an ordinary cash dividend, the Shares or other property will be subject to the same restrictions on transferability and forfeitability as the shares of Restricted Stock with respect to which they were paid. 

(b) Stock Certificates. The Company may require that the Participant deposit in escrow with the Company (or its designee) any stock
certificates issued in respect of shares of Restricted Stock, together with a stock power endorsed in blank. 
 5.3 Restricted Stock
Units. 
 (a) Settlement. The Administrator may provide that settlement of Restricted Stock Units will occur upon or as soon as
reasonably practicable after the Restricted Stock Units vest or will instead be deferred, on a mandatory basis or at the Participant’s election, in a manner intended to comply with Section 409A. 

(b) Stockholder Rights. A Participant will have no rights of a stockholder with respect to Shares subject to any Restricted Stock Unit
unless and until the Shares are delivered in settlement of the Restricted Stock Unit. 
 Dividend Equivalents. If the Administrator
provides, a grant of Restricted Stock Units may provide a Participant with the right to receive Dividend Equivalents. Dividend Equivalents may be paid currently or credited to an account for the Participant, settled in cash or Shares and subject to
the same restrictions on transferability and forfeitability as the Restricted Stock Units with respect to which the Dividend Equivalents are granted and subject to other terms and conditions as set forth in the Award Agreement. 

ARTICLE VI. 
 STOCK
OPTIONS AND STOCK APPRECIATION RIGHTS 
 6.1 General. The Administrator may grant Options or Stock Appreciation Rights to Service
Providers subject to the limitations in the Plan, including any limitations in the Plan that apply to Incentive Stock Options. The Administrator will determine the number of Shares covered by each Option and Stock Appreciation Right, the exercise
price of each Option and Stock Appreciation Right and the conditions and limitations applicable to the exercise of each Option and Stock Appreciation Right. A Stock Appreciation Right will entitle the Participant (or other person entitled to
exercise the Stock Appreciation Right) to receive from the Company upon exercise of the exercisable portion of the Stock Appreciation Right an amount determined by multiplying the excess, if any, of the Fair Market Value of one Share on the date of
exercise over the exercise price per Share of the Stock Appreciation Right by the number of Shares with respect to which the Stock Appreciation Right is exercised, subject to any limitations of the Plan or that the Administrator may impose and
payable in cash, Shares valued at Fair Market Value or a combination of the two as the Administrator may determine or provide in the Award Agreement. 

  
 3 

 6.2 Exercise Price. The Administrator will establish each Option’s and Stock
Appreciation Right’s exercise price and specify the exercise price in the Award Agreement. The exercise price will not be less than 100% of the Fair Market Value on the grant date of the Option or Stock Appreciation Right. 

6.3 Duration. Each Option or Stock Appreciation Right will be exercisable at such times and as specified in the Award Agreement,
provided that the term of an Option or Stock Appreciation Right will not exceed ten years. Notwithstanding the foregoing and unless determined otherwise by the Company, in the event that on the last business day of the term of an Option or Stock
Appreciation Right (other than an Incentive Stock Option) (i) the exercise of the Option or Stock Appreciation Right is prohibited by Applicable Law, as determined by the Company, or (ii) Shares may not be purchased or sold by the
applicable current or former Service Provider due to any Company insider trading policy (including blackout periods) or a “lock-up” agreement undertaken in connection with an issuance of securities
by the Company, the term of the Option or Stock Appreciation Right shall be extended for a period of thirty (30) days following the end of the legal prohibition, black-out period or lock-up agreement, as determined by the Company; provided, however, in no event shall the extension last beyond the ten year term of the applicable Option or Stock Appreciation Right unless the exercise would
violate an Applicable Law. Notwithstanding the foregoing, if the Participant, prior to the end of the term of an Option or Stock Appreciation Right, violates the non-competition,
non-solicitation, confidentiality or any other material provisions of any employment contract, confidentiality and nondisclosure agreement or other agreement between the Participant and the Company or any of
its Subsidiaries, the right to exercise the Option or Stock Appreciation Right, as applicable, may be terminated by the Company and the Company may suspend the Participant’s right to exercise the Option or Stock Appreciation Right when it
reasonably believes that the Participant has participated in any such violation. In addition, if, prior to the end of the term of an Option or Stock Appreciation Right, the Participant is given notice by the Company or any of its Subsidiaries of the
termination of his or her employment or other relationship by the Company or any of its Subsidiaries for Cause, and the effective date of such employment or other termination is subsequent to the date of the delivery of such notice, the right to
exercise the Option or Stock Appreciation Right, as applicable, shall be suspended from the time of the delivery of such notice until the earlier of (i) such time as it is determined or otherwise agreed that the Participant’s employment or
other relationship shall not be terminated for Cause as provided in such notice or (ii) the effective date of such termination of employment or other relationship (in which case the right to exercise the Option or Stock Appreciation Right, as
applicable, shall terminate immediately upon the effective date of such termination of employment or other relationship). 
 6.4
Exercise. Options and Stock Appreciation Rights may be exercised by delivering to the Company a written notice of exercise, in a form the Administrator approves (which may be electronic), signed by the person authorized to exercise the Option
or Stock Appreciation Right, together with, as applicable, payment in full (i) as specified in Section 5.5 for the number of Shares for which the Award is exercised and (ii) as specified in Section 9.5 for any applicable taxes.
Unless the Administrator otherwise determines, an Option or Stock Appreciation Right may not be exercised for a fraction of a Share. 
 6.5
Payment Upon Exercise. Subject to Section 10.8, any Company insider trading policy (including blackout periods) and Applicable Laws, the exercise price of an Option must be paid by: 

(a) cash, wire transfer of immediately available funds or by check payable to the order of the Company; provided, that, the Company may limit
the use of one of the foregoing exercise methods if one or more of the exercise methods below is permitted; 

  
 4 

 (b) by a “net exercise” procedure effected by withholding the minimum number of
Shares otherwise issuable in respect of an Option that are needed to pay the aggregate exercise price of such Option; 
 (c) if there is a
public market for Shares at the time of exercise, unless the Company otherwise determines, (A) delivery (including telephonically to the extent permitted by the Company) of a notice that the Participant has placed a market sell order with a
broker acceptable to the Company with respect to Shares then issuable upon exercise of the Option and that the broker has been directed to deliver promptly to the Company sufficient funds to pay the exercise price, or (B) the Participant’s
delivery to the Company of a copy of irrevocable and unconditional instructions to a broker acceptable to the Company to deliver promptly to the Company cash or a check sufficient to pay the exercise price; provided that such amount is paid to the
Company at such time as may be required by the Administrator; 
 (d) to the extent permitted by the Administrator, delivery (either by
actual delivery or attestation) of Shares owned by the Participant valued at their Fair Market Value; 
 (e) to the extent permitted by the
Administrator, surrendering Shares then issuable upon the Option’s exercise valued at their Fair Market Value on the exercise date; 

(f) to the extent permitted by the Administrator, delivery of a promissory note or any other property that the Administrator determines is
good and valuable consideration; or 
 (g) to the extent permitted by the Company, any combination of the above payment forms approved by
the Administrator. 
 ARTICLE VII. 

OTHER STOCK OR CASH BASED AWARDS 

Other Stock or Cash Based Awards may be granted to Participants, including Awards entitling Participants to receive Shares to be delivered in
the future and including annual or other periodic or long-term cash bonus awards (whether based on specified Performance Criteria or otherwise), in each case as determined by the Administrator subject to any conditions and limitations in the Plan.
Such Other Stock or Cash Based Awards will also be available as a payment form in the settlement of other Awards, as standalone payments and as payment in lieu of compensation to which a Participant is otherwise entitled. Other Stock or Cash Based
Awards may be paid in Shares, cash, or other property, as the Administrator determines. Subject to the provisions of the Plan, the Administrator will determine the terms and conditions of each Other Stock or Cash Based Award, including any purchase
price, performance goal (which may be based on the Performance Criteria), transfer restrictions, and vesting conditions, which will be set forth in the applicable Award Agreement. 

ARTICLE VIII. 

ADJUSTMENTS FOR CHANGES IN COMMON STOCK 

AND CERTAIN OTHER EVENTS 

8.1 Equity Restructuring. In connection with any Equity Restructuring, notwithstanding anything to the contrary in this
Article VIII, the Administrator will equitably adjust each outstanding Award as it deems appropriate to reflect the Equity Restructuring, which may include adjusting the number and type of securities subject to each outstanding Award and/or the
Award’s exercise price or grant price (if applicable), granting new Awards to Participants, and making a cash payment to Participants. The adjustments provided under this Section 8.1 will be nondiscretionary and final and binding on the
affected Participant and the Company; provided that the Administrator will determine whether an adjustment is equitable. 

  
 5 

 8.2 Corporate Transactions. In the event of any dividend or other distribution
(whether in the form of cash, Common Stock, other securities, or other property), reorganization, merger, consolidation, combination, amalgamation, repurchase, recapitalization, liquidation, dissolution, or sale, transfer, exchange or other
disposition of all or substantially all of the assets of the Company, or sale or exchange of Common Stock or other securities of the Company, Change in Control, issuance (but not the exercise) of warrants or other rights to purchase Common Stock or
other securities of the Company, other similar corporate transaction or event, other unusual or nonrecurring transaction or event affecting the Company or its financial statements or any change in any Applicable Laws or accounting principles, the
Administrator, on such terms and conditions as it deems appropriate, either by the terms of the Award or by action taken prior to the occurrence of such transaction or event (except that action to give effect to a change in Applicable Law or
accounting principles may be made within a reasonable period of time after such change) and either unilaterally or upon the Participant’s request, is hereby authorized to take any one or more of the following actions whenever the Administrator
determines that such action is appropriate in order to (x) prevent dilution or enlargement of the benefits or potential benefits intended by the Company to be made available under the Plan or with respect to any Award granted or issued under
the Plan, (y) to facilitate such transaction or event or (z) give effect to such changes in Applicable Laws or accounting principles: 

(a) To provide for the cancellation of any such Award in exchange for either an amount of cash or other property with a value equal to the
amount that could have been obtained upon the exercise or settlement of the vested portion of such Award or realization of the Participant’s rights under the vested portion of such Award, as applicable; provided that, if the amount that could
have been obtained upon the exercise or settlement of the vested portion of such Award or realization of the Participant’s rights, in any case, is equal to or less than zero, then the Award may be terminated without payment; 

(b) To provide that such Award shall vest and, to the extent applicable, be exercisable as to all shares covered thereby, notwithstanding
anything to the contrary in the Plan or the provisions of such Award; 
 (c) To provide that such Award be assumed by the successor or
survivor corporation or entity, or a parent or subsidiary thereof, or shall be substituted for by awards covering the stock of the successor or survivor corporation or entity, or a parent or subsidiary thereof, with appropriate adjustments as to the
number and kind of shares and/or applicable exercise or purchase price, in all cases, as determined by the Administrator; 
 (d) To make
adjustments in the number and type of shares of Common Stock (or other securities or property) subject to outstanding Awards and/or with respect to which Awards may be granted under the Plan (including, but not limited to, adjustments of the
limitations in Article IV hereof on the maximum number and kind of shares which may be issued) and/or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding Awards; and/or 

(e) To replace such Award with other rights or property selected by the Administrator. 

8.3 Acceleration Upon a Change in Control. Notwithstanding anything in Section 8.2 to the contrary, and except as may otherwise be
provided in any applicable Award Agreement or other written agreement between the Company or any of its Subsidiaries and a Participant, if a Change in Control occurs and Awards are not continued, converted, assumed, or replaced by (i) the
Company or a Subsidiary or (ii)

  
 6 

 
a Successor Entity, then immediately prior to the Change in Control such Awards shall become fully exercisable and/or payable, as applicable, and all forfeiture, repurchase and other restrictions
on such Awards shall lapse. Upon, or in anticipation of, a Change in Control, the Administrator may cause any and all Awards outstanding hereunder to terminate at a specific time in the future, including but not limited to the date of such Change in
Control, and shall give each Participant the right to exercise such Awards during a period of time as the Administrator, in its sole and absolute discretion, shall determine. 

8.4 Administrative Stand Still. In the event of any pending stock dividend, stock split, combination or exchange of shares, merger,
consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other extraordinary transaction or change affecting the Shares or the share price of Common Stock, including any Equity Restructuring or
any securities offering or other similar transaction, for administrative convenience, the Administrator may refuse to permit the exercise of any Award for up to sixty days before or after such transaction. 

8.5 General. Except as expressly provided in the Plan or the Administrator’s action under the Plan, no Participant will have any
rights due to any subdivision or consolidation of Shares of any class, dividend payment, increase or decrease in the number of Shares of any class or dissolution, liquidation, merger, or consolidation of the Company or other corporation. Except as
expressly provided with respect to an Equity Restructuring under Section 8.1 above or the Administrator’s action under the Plan, no issuance by the Company of Shares of any class, or securities convertible into Shares of any class, will
affect, and no adjustment will be made regarding, the number of Shares subject to an Award or the Award’s grant or exercise price. The existence of the Plan, any Award Agreements and the Awards granted hereunder will not affect or restrict in
any way the Company’s right or power to make or authorize (i) any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, (ii) any merger, consolidation dissolution or
liquidation of the Company or sale of Company assets or (iii) any sale or issuance of securities, including securities with rights superior to those of the Shares or securities convertible into or exchangeable for Shares. The Administrator may
treat Participants and Awards (or portions thereof) differently under this Article VIII. 
 ARTICLE IX. 

GENERAL PROVISIONS APPLICABLE TO AWARDS 

9.1 Transferability. Except as the Administrator may determine or provide in an Award Agreement or otherwise for Awards other than
Incentive Stock Options, Awards may not be sold, assigned, transferred, pledged, or otherwise encumbered, either voluntarily or by operation of law, except by will or the laws of descent and distribution, or, subject to the Administrator’s
consent, pursuant to a domestic relations order, and, during the life of the Participant, will be exercisable only by the Participant. References to a Participant, to the extent relevant in the context, will include references to a
Participant’s authorized transferee that the Administrator specifically approves. 
 9.2 Documentation. Each Award will be
evidenced in an Award Agreement, which may be written or electronic, as the Administrator determines. Each Award may contain terms and conditions in addition to those set forth in the Plan. 

9.3 Discretion. Except as the Plan otherwise provides, each Award may be made alone or in addition or in relation to any other Award.
The terms of each Award to a Participant need not be identical, and the Administrator need not treat Participants or Awards (or portions thereof) uniformly. 

9.4 Termination of Status. The Administrator will determine how the disability, death, retirement, authorized leave of absence or any
other change or purported change in a Participant’s Service Provider status affects an Award and the extent to which, and the period during which, the Participant, the Participant’s legal representative, conservator, guardian, or
Designated Beneficiary may exercise rights under the Award, if applicable. 

  
 7 

 9.5 Withholding. Each Participant must pay the Company, or make provision
satisfactory to the Administrator for payment of, any taxes required by law to be withheld in connection with such Participant’s Awards by the date of the event creating the tax liability. The Company may deduct an amount sufficient to satisfy
such tax obligations based on the minimum statutory withholding rates (or such other rate as may be determined by the Administrator after considering any accounting consequences or costs) from any payment of any kind otherwise due to a Participant.
Subject to Section 10.8 and any Company insider trading policy (including blackout periods), Participants may satisfy such tax obligations (i) in cash, by wire transfer of immediately available funds, by check made payable to the order of
the Company; provided, that, the Administrator may limit the use of one of the foregoing methods if one or more of the exercise methods below is permitted, (ii) to the extent permitted by the Administrator, in whole or in part by delivery of
Shares, including Shares retained from the Award creating the tax obligation, valued at their Fair Market Value, (iii) if there is a public market for Shares at the time the tax obligations are satisfied, unless the Administrator otherwise
determines, (A) delivery (including telephonically to the extent permitted by the Administrator) of a notice that the Participant has placed a market sell order with a broker acceptable to the Administrator with respect to Shares then issuable
upon exercise of the Award and that the broker has been directed to deliver promptly to the Company sufficient funds to satisfy the tax obligations, or (B) delivery by the Participant to the Company of a copy of irrevocable and unconditional
instructions to a broker acceptable to the Administrator to deliver promptly to the Company cash or a check sufficient to satisfy the tax withholding; provided that such amount is paid to the Company at such time as may be required by the
Administrator, or (iv) to the extent permitted by the Administrator, any combination of the foregoing payment forms approved by the Administrator. If any tax withholding obligation will be satisfied under clause (ii) of the immediately
preceding sentence by the Company’s retention of Shares from the Award creating the tax obligation and there is a public market for Shares at the time the tax obligation is satisfied, the Company may elect to instruct any brokerage firm
determined acceptable to the Administrator for such purpose to sell on the applicable Participant’s behalf some or all of the Shares retained and to remit the proceeds of the sale to the Company or its designee, and each Participant’s
acceptance of an Award under the Plan will constitute the Participant’s authorization to the Company and instruction and authorization to such brokerage firm to complete the transactions described in this sentence. 

9.6 Amendment of Award; Prohibition on Repricing. The Administrator may amend, modify, or terminate any outstanding Award, including by
substituting another Award of the same or a different type, changing the exercise or settlement date, and converting an Incentive Stock Option to a Non-Qualified Stock Option. The Participant’s consent to
such action will not be required unless (i) the action, taking into account any related action, materially and adversely affects the Participant’s rights under the Award. Notwithstanding the foregoing, than pursuant to Sections 8.1 and
8.2, the Administrator shall not without the approval of the Company’s stockholders (a) lower the exercise price per Share of an Option or Stock Appreciation Right after it is granted, (b) cancel an Option or Stock Appreciation Right
when the exercise price per Share exceeds the Fair Market Value of one Share in exchange for cash or another Award, or (c) take any other action with respect to an Option or Stock Appreciation Right that the Administrator determines would be
treated as a repricing under the rules and regulations of the principal U.S. national securities exchange on which the Shares are listed. 

9.7 Conditions on Delivery of Stock. The Company will not be obligated to deliver any Shares under the Plan or remove restrictions from
Shares previously delivered under the Plan until (i) all Award conditions have been met or removed to the Administrator’s satisfaction, (ii) as determined by the Administrator, all other legal matters regarding the issuance and
delivery of such Shares have been satisfied, including any applicable securities laws and stock exchange or stock market rules and regulations, and (iii) the Participant has executed and delivered to the Company such representations or
agreements as the 

  
 8 

 
Administrator deems necessary or appropriate to satisfy any Applicable Laws. The Company’s inability to obtain authority from any regulatory body having jurisdiction, which the Administrator
determines is necessary to the lawful issuance and sale of any securities, will relieve the Company of any liability for failing to issue or sell such Shares as to which such requisite authority has not been obtained. 

9.8 Acceleration. The Administrator may at any time provide that any Award will become immediately vested and fully or partially
exercisable, free of some or all restrictions or conditions, or otherwise fully or partially realizable. 
 9.9 Additional Terms of
Incentive Stock Options. The Administrator may grant Incentive Stock Options only to employees of the Company, any of its present or future parent or subsidiary corporations, as defined in Sections 424(e) or (f) of the Code,
respectively, and any other entities the employees of which are eligible to receive Incentive Stock Options under the Code. If an Incentive Stock Option is granted to a Greater Than 10% Stockholder, the exercise price will not be less than 110% of
the Fair Market Value on the Option’s grant date, and the term of the Option will not exceed five years. All Incentive Stock Options will be subject to and construed consistently with Section 422 of the Code. By accepting an Incentive
Stock Option, the Participant agrees to give prompt notice to the Company of dispositions or other transfers (other than in connection with a Change in Control) of Shares acquired under the Option made within (i) two years from the grant date
of the Option or (ii) one year after the transfer of such Shares to the Participant, specifying the date of the disposition or other transfer and the amount the Participant realized, in cash, other property, assumption of indebtedness or other
consideration, in such disposition or other transfer. Neither the Company nor the Administrator will be liable to a Participant, or any other party, if an Incentive Stock Option fails or ceases to qualify as an “incentive stock option”
under Section 422 of the Code. Any Incentive Stock Option or portion thereof that fails to qualify as an “incentive stock option” under Section 422 of the Code for any reason, including becoming exercisable with respect to Shares
having a fair market value exceeding the $100,000 limitation under Treasury Regulation Section 1.422-4, will be a Non-Qualified Stock Option. 

ARTICLE X. 

MISCELLANEOUS 
 10.1 No
Right to Employment or Other Status. No person will have any claim or right to be granted an Award, and the grant of an Award will not be construed as giving a Participant the right to continued employment or any other relationship with the
Company. The Company expressly reserves the right at any time to dismiss or otherwise terminate its relationship with a Participant free from any liability or claim under the Plan or any Award, except as expressly provided in an Award Agreement.

 10.2 No Rights as Stockholder; Certificates. Subject to the Award Agreement, no Participant or Designated Beneficiary will have
any rights as a stockholder with respect to any Shares to be distributed under an Award until becoming the record holder of such Shares. Notwithstanding any other provision of the Plan, unless the Administrator otherwise determines or Applicable
Laws require, the Company will not be required to deliver to any Participant certificates evidencing Shares issued in connection with any Award and instead such Shares may be recorded in the books of the Company (or, as applicable, its transfer
agent or stock plan administrator). The Company may place legends on stock certificates issued under the Plan that the Administrator deems necessary or appropriate to comply with Applicable Laws. 

10.3 Effective Date and Term of Plan. The Plan shall become effective on the date that it is approved by the Board (the
“Effective Date). From and after the Effective Date, the Plan shall govern all Awards hereunder. 

  
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 10.4 Amendment of Plan. The Administrator may amend, suspend, or terminate the Plan
at any time; provided that no amendment, other than an increase to the Overall Share Limit, may materially and adversely affect any Award outstanding at the time of such amendment without the affected Participant’s consent. No Awards may be
granted under the Plan during any suspension period or after Plan termination. Awards outstanding at the time of any Plan suspension or termination will continue to be governed by the Plan and the Award Agreement, as in effect before such suspension
or termination. The Board will obtain stockholder approval of any Plan amendment to the extent necessary to comply with Applicable Laws. 

10.5 Provisions for Foreign Participants. The Administrator may modify Awards granted to Participants who are foreign nationals or
employed outside the United States or establish subplans or procedures under the Plan to address differences in laws, rules, regulations, or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other
matters. 
 10.6 Section 409A. 

(a) General. The Company intends that all Awards be structured to comply with, or be exempt from, Section 409A, such that no
adverse tax consequences, interest, or penalties under Section 409A apply. Notwithstanding anything in the Plan or any Award Agreement to the contrary, the Administrator may, without a Participant’s consent, amend this Plan or Awards,
adopt policies and procedures, or take any other actions (including amendments, policies, procedures and retroactive actions) as are necessary or appropriate to preserve the intended tax treatment of Awards, including any such actions intended to
(A) exempt this Plan or any Award from Section 409A, or (B) comply with Section 409A, including regulations, guidance, compliance programs and other interpretative authority that may be issued after an Award’s grant date.
The Company makes no representations or warranties as to an Award’s tax treatment under Section 409A or otherwise. The Company will have no obligation under this Section 10.6 or otherwise to avoid the taxes, penalties, or interest
under Section 409A with respect to any Award and will have no liability to any Participant or any other person if any Award, compensation or other benefits under the Plan are determined to constitute noncompliant “nonqualified deferred
compensation” subject to taxes, penalties, or interest under Section 409A. 
 (b) Separation from Service. If an Award
constitutes “nonqualified deferred compensation” under Section 409A, any payment or settlement of such Award upon a termination of a Participant’s Service Provider relationship will, to the extent necessary to avoid taxes under
Section 409A, be made only upon the Participant’s “separation from service” (within the meaning of Section 409A), whether such “separation from service” occurs upon or after the termination of the
Participant’s Service Provider relationship. For purposes of this Plan or any Award Agreement relating to any such payments or benefits, references to a “termination,” “termination of employment” or like terms means a
“separation from service.” 
 (c) Payments to Specified Employees. Notwithstanding any contrary provision in the Plan or
any Award Agreement, any payment(s) of “nonqualified deferred compensation” required to be made under an Award to a “specified employee” (as defined under Section 409A and as the Administrator determines) due to his or her
“separation from service” will, to the extent necessary to avoid taxes under Section 409A(a)(2)(B)(i) of the Code, be delayed for the six-month period immediately following such “separation
from service” (or, if earlier, until the specified employee’s death) and will instead be paid (as set forth in the Award Agreement) on the day immediately following such six-month period or as soon
as administratively practicable thereafter (without interest). Any payments of “nonqualified deferred compensation” under such Award payable more than six months following the Participant’s “separation from service” will be
paid at the time or times the payments are otherwise scheduled to be made. 

  
 10 

 10.7 Limitations on Liability. Notwithstanding any other provisions of the Plan, no
individual acting as a director, officer, other employee or agent of the Company or any Subsidiary will be liable to any Participant, former Participant, spouse, beneficiary, or any other person for any claim, loss, liability, or expense incurred in
connection with the Plan or any Award, and such individual will not be personally liable with respect to the Plan because of any contract or other instrument executed in his or her capacity as an Administrator, director, officer, other employee or
agent of the Company or any Subsidiary. The Company will indemnify and hold harmless each director, officer, other employee and agent of the Company or any Subsidiary that has been or will be granted or delegated any duty or power relating to the
Plan’s administration or interpretation, against any cost or expense (including attorneys’ fees) or liability (including any sum paid in settlement of a claim with the Administrator’s approval) arising from any act or omission
concerning this Plan unless arising from such person’s own fraud or bad faith. 
 10.8
Lock-Up Period. The Company may, at the request of any underwriter representative or otherwise, in connection with registering the offering of any Company securities under the Securities Act, prohibit
Participants from, directly or indirectly, selling or otherwise transferring any Shares or other Company securities, whether subject to outstanding Awards or otherwise, during a period of up to one hundred eighty days following the effective date of
a Company registration statement filed under the Securities Act, or such longer period as determined by the underwriter (the “Lock-Up Period”). The Company may impose stop-transfer instructions with
respect to Shares subject to the foregoing prohibitions until the end of the Lock-Up Period and these restrictions will be binding on the applicable Participant. Further, each Participant shall, if so
requested by any underwriter representative, execute a customary lock-up agreement which shall provide such terms as such underwriter representative may in its discretion request, including, without limitation
the prohibition on sale and transfer during the Lock-Up Period described in this Section 10.8. 

10.9 Data Privacy. As a condition for receiving any Award, each Participant explicitly and unambiguously consents to the collection,
use and transfer, in electronic or other form, of personal data as described in this section by and among the Company and its Subsidiaries and affiliates exclusively for implementing, administering and managing the Participant’s participation
in the Plan. The Company and its Subsidiaries and affiliates may hold certain personal information about a Participant, including the Participant’s name, address, and telephone number; birthdate; social security, insurance number or other
identification number; salary; nationality; job title(s); any Shares held in the Company or its Subsidiaries and affiliates; and Award details, to implement, manage and administer the Plan and Awards (the “Data”). The Company and its
Subsidiaries and affiliates may transfer the Data amongst themselves as necessary to implement, administer and manage a Participant’s participation in the Plan, and the Company and its Subsidiaries and affiliates may transfer the Data to third
parties assisting the Company with Plan implementation, administration, and management. These recipients may be located in the Participant’s country, or elsewhere, and the Participant’s country may have different data privacy laws and
protections than the recipients’ country. By accepting an Award, each Participant authorizes such recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, to implement, administer and manage the
Participant’s participation in the Plan, including any required Data transfer to a broker or other third party with whom the Company or the Participant may elect to deposit any Shares. The Data related to a Participant will be held only as long
as necessary to implement, administer, and manage the Participant’s participation in the Plan. A Participant may, at any time, view the Data that the Company holds regarding such Participant, request additional information about the storage and
processing of the Data regarding such Participant, recommend any necessary corrections to the Data regarding the Participant or refuse or withdraw the consents in this Section 10.8 in writing, without cost, by contacting the local human
resources representative. The Company may cancel Participant’s ability to participate in the Plan and, in the Administrator’s discretion, the Participant may forfeit any outstanding Awards if the Participant refuses or withdraws the
consents in this Section 10.8. For more information on the consequences of refusing or withdrawing consent, Participants may contact their local human resources representative. 

  
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 10.10 Severability. If any portion of the Plan or any action taken under it is held
illegal or invalid for any reason, the illegality or invalidity will not affect the remaining parts of the Plan, and the Plan will be construed and enforced as if the illegal or invalid provisions had been excluded, and the illegal or invalid action
will be null and void. 
 10.11 Governing Documents. If any contradiction occurs between the Plan and any Award Agreement or other
written agreement between a Participant and the Company (or any Subsidiary) that the Administrator has approved, the Plan will govern, unless it is expressly specified in such Award Agreement or other written document that a specific provision of
the Plan will not apply. 
 10.12 Governing Law. The Plan and all Awards will be governed by and interpreted in accordance with the
laws of the State of Delaware, disregarding any state’s choice-of-law principles requiring the application of a jurisdiction’s laws other than the State of
Delaware. 
 10.13 Claw-back Provisions. All Awards (including any proceeds, gains or other economic benefit the Participant actually
or constructively receives upon receipt or exercise of any Award or the receipt or resale of any Shares underlying the Award) will be subject to any Company claw-back policy, including any claw-back policy adopted to comply with Applicable Laws
(including the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules or regulations promulgated thereunder) as set forth in such claw-back policy or the Award Agreement. 

10.14 Titles and Headings. The titles and headings in the Plan are for convenience of reference only and, if any conflict, the
Plan’s text, rather than such titles or headings, will control. 
 10.15 Conformity to Securities Laws. Participant acknowledges
that the Plan is intended to conform to the extent necessary with Applicable Laws. Notwithstanding anything herein to the contrary, the Plan and all Awards will be administered only in conformance with Applicable Laws. To the extent Applicable Laws
permit, the Plan and all Award Agreements will be deemed amended as necessary to conform to Applicable Laws. 
 10.16 Relationship to
Other Benefits; Non-exclusivity. No payment under the Plan will be taken into account in determining any benefits under any pension, retirement, savings, profit sharing, group insurance, welfare or other
benefit plan of the Company or any Subsidiary except as expressly provided in writing in such other plan or an agreement thereunder. The Plan is not the exclusive mechanism of the Company for awarding incentive compensation to Employees and other
service providers. The Company’s adoption of the Plan and participation in the Plan by Participants shall in no way limit the ability of the Company to grant other incentive compensation to such Participants at any time. 

10.17 Broker-Assisted Sales. In the event of a broker-assisted sale of Shares in connection with the payment of amounts owed by a
Participant under or with respect to the Plan or Awards, including amounts to be paid under the final sentence of Section 9.5: (a) any Shares to be sold through the broker-assisted sale will be sold on the day the payment first becomes due, or
as soon thereafter as practicable; (b) such Shares may be sold as part of a block trade with other Participants in the Plan in which all participants receive an average price; (c) the applicable Participant will be responsible for all
broker’s fees and other costs of sale, and by accepting an Award, each Participant agrees to indemnify and hold the Company harmless from any losses, costs, damages, or expenses relating to any such sale; (d) to the extent the Company or
its designee receives proceeds of such sale that exceed the amount owed, the Company will pay such excess in cash to the applicable Participant as soon as reasonably practicable; (e) the Company and its designees are under no obligation to
arrange for such sale at any particular price; and (f) in the event the proceeds of such sale are insufficient to satisfy the Participant’s applicable obligation, the Participant may be required to pay immediately upon demand to the
Company or its designee an amount in cash sufficient to satisfy any remaining portion of the Participant’s obligation. 

  
 12 

 10.18 Other Agreements. The Administrator may require, as a condition to the vesting,
grant and/or the receipt or settlement of an Award or in connection with a Change in Control or other transaction, that the Participant execute such agreements, as it may determine in its reasonable discretion as advisable or necessary. If the
Participant is already subject to an agreement containing non-competition, non-solicitation, confidentiality, non-disparagement,
or other restrictive covenants (collectively, “Restrictive Covenants”), then such agreements shall not increase the scope or length of any Restrictive Covenants. 

ARTICLE XI. 
 DEFINITIONS

 As used in the Plan, the following words and phrases will have the following meanings: 

11.1 “Administrator” means the Board or a Committee to the extent that the Board’s powers or authority under the
Plan have been delegated to such Committee. 
 11.2 “Applicable Laws” means the requirements relating to the
administration of equity incentive plans under U.S. federal and state securities, tax and other applicable laws, rules and regulations, the applicable rules of any stock exchange or quotation system on which the Common Stock is listed or quoted and
the applicable laws and rules of any foreign country or other jurisdiction where Awards are granted. 
 11.3 “Award”
means, individually or collectively, a grant under the Plan of Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units or Other Stock or Cash Based Awards. 

11.4 “Award Agreement” means a written agreement evidencing an Award, which may be electronic, that contains such
terms and conditions as the Administrator determines, consistent with and subject to the terms and conditions of the Plan. 
 11.5
“Board” means the Board of Directors of the Company. 
 11.6 “Change in Control” means and
includes each of the following: 
 (a) A transaction or series of transactions occurring after the Effective Date whereby any
“person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) (other than the Company, any of its subsidiaries, an employee benefit plan maintained by the Company
or any of its subsidiaries or a “person” that, prior to such transaction, directly or indirectly controls, is controlled by, or is under common control with, the Company) directly or indirectly acquires beneficial ownership (within the
meaning of Rule 13d-3 under the Exchange Act) of securities of the Company possessing more than 50% of the total combined voting power of the Company’s securities outstanding immediately after such
transaction; or 
 (b) During any period of two consecutive years, individuals who, at the beginning of such period, constitute the Board
together with any new Director(s) (other than a Director designated by a person who shall have entered into an agreement with the Company to effect a transaction described in subsections (a) or (c)) whose election by the Board or nomination for
election by the Company’s stockholders was approved by a vote of at least two-thirds of the Directors then still in office who either were Directors at the beginning of the
two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or 

  
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 (c) The consummation by the Company (whether directly involving the Company or indirectly
involving the Company through one or more intermediaries) after the Effective Date of (x) a merger, consolidation, reorganization, or business combination or (y) a sale or other disposition of all or substantially all of the Company’s
assets in any single transaction or series of related transactions or (z) the acquisition of assets or stock of another entity, in each case other than a transaction: 

(i) which results in the Company’s voting securities outstanding immediately before the transaction continuing to represent (either by
remaining outstanding or by being converted into voting securities of the Company or the person that, as a result of the transaction, controls, directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of the
Company’s assets or otherwise succeeds to the business of the Company (the Company or such person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined voting power of the Successor
Entity’s outstanding voting securities immediately after the transaction, and 
 (ii) after which no person or group beneficially owns
voting securities representing 50% or more of the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this clause (ii) as beneficially owning 50% or more of
the combined voting power of the Successor Entity solely as a result of the voting power held in the Company prior to the consummation of the transaction. 

Notwithstanding the foregoing, if a Change in Control constitutes a payment event with respect to any Award (or portion of any Award) that
provides for the deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event described in subsection (a), (b) or (c) with
respect to such Award (or portion thereof) shall only constitute a Change in Control for purposes of the payment timing of such Award if such transaction also constitutes a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5). 
 11.7 “Code” means the Internal Revenue Code of
1986, as amended, and the regulations issued thereunder. 
 11.8 “Committee” means one or more committees or
subcommittees of the Board, which may include one or more Company directors or executive officers, to the extent Applicable Laws permit. To the extent required to comply with the provisions of Rule 16b-3, it
is intended that each member of the Committee will be, at the time the Committee takes any action with respect to an Award that is subject to Rule 16b-3, a
“non-employee director” within the meaning of Rule 16b-3; however, a Committee member’s failure to qualify as a
“non-employee director” within the meaning of Rule 16b-3 will not invalidate any Award granted by the Committee that is otherwise validly granted under the
Plan. 
 11.9 “Common Stock” means the Class A common stock of the Company. 

11.10 “Company” means Lonestar Resources US Inc., a Delaware corporation, or any successor. 

11.11 “Consultant” means any person, including any adviser, engaged by the Company or its parent or Subsidiary to
render services to such entity if the consultant or adviser: (i) renders bona fide services to the Company; (ii) renders services not in connection with the offer or sale of securities in a capital-raising transaction and does not directly
or indirectly promote or maintain a market for the Company’s securities; and (iii) is a natural person. 
 11.12
“Designated Beneficiary” means the beneficiary or beneficiaries the Participant designates, in a manner the Administrator determines, to receive amounts due or exercise the Participant’s rights if the Participant dies or
becomes incapacitated. Without a Participant’s effective designation, “Designated Beneficiary” will mean the Participant’s estate. 

  
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 11.13 “Director” means a Board member. 

11.14 “Disability” means a permanent and total disability under Section 22(e)(3) of the Code, as amended. 

11.15 “Dividend Equivalents” means a right granted to a Participant under the Plan to receive the equivalent value (in
cash or Shares) of dividends paid on Shares. 
 11.16 “Employee” means any employee of the Company or its
Subsidiaries. 
 11.17 “Equity Restructuring” means a nonreciprocal transaction between the Company and its
stockholders, such as a stock dividend, stock split, spin-off, or recapitalization through a large, nonrecurring cash dividend, that affects the number or kind of Shares (or other Company securities) or the
share price of Common Stock (or other Company securities) and causes a change in the per share value of the Common Stock underlying outstanding Awards. 

11.18 “Exchange Act” means the Securities Exchange Act of 1934, as amended. 

11.19 “Fair Market Value” means, as of any date, the value of Common Stock determined as follows: (i) if the
Common Stock is listed on any established stock exchange, its Fair Market Value will be the closing sales price for such Common Stock as quoted on such exchange for such date, or if no sale occurred on such date, the last day preceding such date
during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; (ii) if the Common Stock is not traded on a stock exchange but is quoted on a national market or other quotation system,
the closing sales price on such date, or if no sales occurred on such date, then on the last date preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; or
(iii) without an established market for the Common Stock, the Administrator will determine the Fair Market Value in its discretion. 

11.20 “Greater Than 10% Stockholder” means an individual then owning (within the meaning of Section 424(d) of the
Code) more than 10% of the total combined voting power of all classes of stock of the Company or its parent or subsidiary corporation, as defined in Section 424(e) and (f) of the Code, respectively. 

11.21 “Incentive Stock Option” means an Option intended to qualify as an “incentive stock option” as defined
in Section 422 of the Code. 
 11.22 “Non-Qualified Stock Option” means
an Option not intended or not qualifying as an Incentive Stock Option. 
 11.23 “Option” means an option to purchase
Shares. 
 11.24 “Other Stock or Cash Based Awards” means cash awards, awards of Shares, and other awards valued
wholly or partially by referring to, or are otherwise based on, Shares or other property. 
 11.25 “Overall Share
Limit” means 966,184 Shares. 
 11.26 “Participant” means a Service Provider who has been granted an
Award. 

  
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 11.27 “Performance Criteria” mean the criteria (and adjustments)
that the Administrator may select for an Award to establish performance goals for a performance period, which may include the following: net earnings (either before or after interest, taxes, depreciation and amortization), sales or revenue, net
income (either before or after taxes), operating earnings, cash flow (including, but not limited to, operating cash flow and free cash flow), return on net assets, return on stockholders’ equity, return on assets, return on capital, return on
sales, gross or net profit margin, expenses or expense levels, total shareholder return, internal rate of return (IRR), financial ratios (including those measuring liquidity, activity, profitability or leverage), working capital, earnings per Share,
price per Share, market capitalization, any GAAP financial performance measures, inventory management, measures related to A/R balance and write-offs, timeliness and/or accuracy of business reporting, approval or implementation of strategic plans,
financing and other capital raising transactions, debt levels or reductions, cash levels, acquisition activity, investment sourcing activity, marketing initiatives, projects or processes, achievement of customer satisfaction objectives, net asset
value, net asset value per share, capital expenditures, net borrowing, debt leverage levels, credit quality or debt ratings, economic value added, individual business objectives, growth in production, added reserves, growth in reserves, inventory
growth, environmental health and safety performance, effectiveness of hedging programs, improvements in internal controls and policies, and retention and recruitment of employees, any of which may
be measured in absolute terms or as compared to any incremental increase or decrease. Such performance goals also may be based solely by reference to the Company’s performance or the performance of a Subsidiary, division, business segment or
business unit of the Company or a Subsidiary, or based upon performance relative to performance of other companies or upon comparisons of any of the indicators of performance relative to performance of other companies. The Administrator may provide
for exclusion of the impact of an event or occurrence which the Administrator determines should appropriately be excluded, including (a) restructurings, discontinued operations, extraordinary items, and other unusual, infrequently occurring or non-recurring charges or events, (b) asset write-downs, (c) litigation or claim judgments or settlements, (d) acquisitions or divestitures, (e) reorganization or change in the corporate structure
or capital structure of the Company, (f) an event either not directly related to the operations of the Company, Subsidiary, division, business segment or business unit or not within the reasonable control of management, (g) foreign
exchange gains and losses, (h) a change in the fiscal year of the Company, (i) the refinancing or repurchase of bank loans or debt securities, (j) unbudgeted capital expenditures, (k) the issuance or repurchase of equity
securities and other changes in the number of outstanding shares, (l) conversion of some or all of convertible securities to Common Stock, (m) any business interruption event, (n) the cumulative effects of tax or accounting changes in
accordance with U.S. generally accepted accounting principles, or (o) the effect of changes in other laws or regulatory rules affecting reported results. 

11.28 “Plan” means this 2021 Management Incentive Plan, as amended from time to time. 

11.29 “Restricted Stock” means Shares awarded to a Participant under Article VI subject to certain vesting
conditions and other restrictions. 
 11.30 “Restricted Stock Unit” means an unfunded, unsecured right to receive,
on the applicable settlement date, one Share or an amount in cash or other consideration determined by the Administrator to be of equal value as of such settlement date, subject to certain vesting conditions and other restrictions. 

11.31 “Rule 16b-3” means Rule 16b-3
promulgated under the Exchange Act. 
 11.32 “Section 409A” means Section 409A
of the Code and all regulations, guidance, compliance programs and other interpretative authority thereunder. 
 11.33
“Securities Act” means the Securities Act of 1933, as amended. 

  
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 11.34 “Service Provider” means an Employee, Consultant or Director.

 11.35 “Shares” means shares of Common Stock. 

11.36 “Stock Appreciation Right” means a stock appreciation right granted under Article V. 

11.37 “Subsidiary” means any entity (other than the Company), whether domestic or foreign, in an unbroken chain of
entities beginning with the Company if each of the entities other than the last entity in the unbroken chain beneficially owns, at the time of the determination, securities or interests representing at least 50% of the total combined voting power of
all classes of securities or interests in one of the other entities in such chain. 
 11.38 “Substitute Awards”
shall mean Awards granted or Shares issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, in each case by a company acquired by the Company or any
Subsidiary or with which the Company or any Subsidiary combines. 
 11.39 “Termination of Service” means the date
the Participant ceases to be a Service Provider. 
 * * * * * 

  
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