Document:

ex10.1

 

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 AGREEMENT AND PLAN OF MERGER
 

 

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 By and among
 

 INTELLIGENT POWER ACQUISITION, INC.,
 

 A wholly-owned subsidiary of
 

 BLUE EARTH, INC.,
 

 And
 

 The Stockholders named herein
 

 And
 

 INTELLIGENT POWER, INC.,
 

 

 

 _______________________________________________________________________
 

 EFFECTIVE DATE:  July 24, 2013
 

 _______________________________________________________________________
 

 

 

 

 

 

 

 
 

 

 

 	 	
	 Exhibits
	 Description

	  
	  

	  
	  

	 Exhibit 2(a)
	 Form of General Release

	 Exhibit 2(a)(iv)
	 Paulson Fee Agreement

	 Exhibit 3(a)(i) 
	 Form of Lock Up Agreement

	 Exhibit 3(d)(i)
	 Form of Employment Agreement

	 Exhibit 4(q)
	 Unaudited Financial Statements

	  
	  

	 Schedules
	 Description

	  
	  

	 Schedule A
 Schedule B
	 Stockholder list
 Indebtedness

	 Schedule 3(e)
	 Employee Options

	 Schedule 4(n)
	 Consents

	 Schedule 4(o)
	 Legal Proceedings

	 Schedule 4(r)
	 Tax Matters

	 Schedule 4(s)
	 Inventory

	 Schedule 4(t) 
	 Real Property Owned or Leased; Personal Property Leased 

	 Schedule 4(u) 
	 Material Contracts

	 Schedule 4(v) 
	 Proprietary Rights 

	 Schedule 4(w)
	 Default, Violations or Restrictions

	 Schedule 4(x)
	 Court Orders and Decrees

	 Schedule 4(z) 
	 Employee Handbook

	 Schedule 4(aa) 
	 Insurance Policies 

	 Schedule 4(dd) 
	 Labor Matters 

	 Schedule 4(hh)
	 Governmental Licenses

	 Schedule 4(a)(i)
	 Patents and Trademark Assignments

 

 

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 AGREEMENT AND PLAN OF MERGER
 THIS AGREEMENT AND PLAN OF MERGER (this “Agreement”), dated as of July 24, 2013, by and among: (a) the stockholders of Intelligent Power, Inc. set forth on Schedule A attached hereto (each a “Stockholder” and collectively, the “Stockholders”); (b) Intelligent Power, Inc., an Oregon corporation (the “Company”); (c) Blue Earth, Inc., a Nevada corporation (“BBLU”); and (d) Intelligent Power Acquisition, Inc. (“Newco”), a newly formed Oregon corporation formed for the purpose of merging with and into the Company.
 W I T N E S S E T H:
 WHEREAS, the Company is in the business of providing a broad range of comprehensive energy solutions, including the design, construction and implementation of energy saving projects and comprehensive maintenance and service programs;
 WHEREAS, the Stockholders wish to transfer, and BBLU wishes to acquire, the securities set forth on Schedule A, on the terms and subject to the conditions set forth in this Agreement;
 WHEREAS, the Boards of Directors of BBLU and Newco have determined that the Merger (as defined herein) is consistent with and in furtherance of each company’s long-term business strategy and fair to, and in the best interests of BBLU and Newco and their respective stockholders;
 WHEREAS, the Stockholders of the Company have determined that the Merger is consistent with and in furtherance of its long-term business strategy and fair to, and in the best interests of the Company and the Stockholders;
 WHEREAS, the Board of Directors of each of BBLU (on its own behalf and as the sole stockholder of Newco), Newco and the Company have each adopted resolutions approving this Agreement and the Merger of Newco with and into the Company (the “Merger”), resulting in the conversion of all of the stock of Newco into shares of the Surviving Corporation (as defined herein) and with the Company continuing as the surviving entity in the Merger in accordance with the Oregon Business Corporations Act (“OBCA”) and, in each such case, upon the terms and conditions set forth in this Agreement;
 WHEREAS, each outstanding share of common stock of the Company (the “Company Shares”) shall be exchanged for the Merger Consideration (as defined herein); and
 WHEREAS, for U.S. federal income tax purposes, it is intended that the Merger shall constitute a reorganization within the meaning of Section 368(a)(1)(A) and (a)(2)(E) of the Internal Revenue Code of 1986, as amended (the “Code”), and that this Agreement shall constitute a “plan of reorganization” within the meaning of Section 368(b) of the Code.
 NOW THEREFORE, in consideration of the mutual covenants of the parties as hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties hereto hereby agree as follows:
 

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 Section 1.
 Merger Transaction.
 (a)
 The Merger.  Upon the terms and subject to the conditions of this Agreement, the Merger shall be consummated in accordance with the OBCA.  At the Effective Date (defined below), upon the terms and subject to the conditions of this Agreement, Newco shall be merged with and into the Company in accordance with the OBCA and the separate existence of Newco shall thereupon cease and the Company, as the surviving corporation in the Merger (the “Surviving Corporation”), shall continue its corporate existence under the laws of Oregon, as a wholly-owned subsidiary of BBLU.  Each share of stock of Newco in existence prior to the Merger shall be converted into one (1) share of common stock in the Surviving Corporation.
 (b)
 Closing; Effective.
 (i)
 The Closing of the Merger (the “Closing”) shall take place at the offices of the Company, or at such other location as may be agreed to by the parties, upon the execution of this Agreement at 10:00 A.M., or at such other date, time or location as may be agreed to by the parties (the “Closing Date”).  The effective date of the Merger shall be the commencement of business on the day following the Closing Date (the “Effective Date”).
 (ii)
 Subject to the provisions of this Agreement, at the Closing, the parties shall file with the Secretary of State of Oregon the Articles of Merger (the “Articles of Merger”) in accordance with the OBCA and executed in accordance with the relevant provisions of the OBCA and shall make all other filings or recordings required under such law in order to complete the Merger.  The Merger shall be completed at such time as the Articles of Merger are duly filed with the Secretary of State of Oregon and for all other purposes as of the close of business on the Closing Date.
 (c)
 Succession.  Upon the filing of the Articles of Merger as described above, the Company shall succeed to all of the rights, privileges, debts, liabilities, powers, properties and contract rights of Newco in the manner of and as more fully set forth in the OBCA.
 Section 2.
 Merger Consideration.  At the Effective Date by virtue of the Merger, BBLU shall deliver the consideration for the Merger (the “Merger Consideration”), which shall be an aggregate of $3,500,000, pursuant to the terms and conditions of this Agreement.  The Merger Consideration shall be provided to the Stockholders based on the value of the patents and intellectual property of the Company, as well as the state of the business, as confirmed by the values paid by third parties in private placements into the Company, and also confirmed by the valuations that multiple independent third party private business valuation firms have made.  In addition, the Merger Consideration includes the payment of certain obligations of the Company, as described in items (b) and (c) below.  The Merger Consideration shall be payable by:
 (a)
 BBLU Shares and Debts.  BBLU shall issue 1,383,400 restricted shares of common stock of BBLU (the “BBLU Shares”), valued at $2.53 per share, which was the ten (10) day average closing price for shares of BBLU through June 8, 2013 when the agreement in principle on the share exchange was reached.
 (i)
 The BBLU Shares shall be issued and prorated among the Stockholders of the Company based upon each Stockholder’s percentage ownership, as shown in Schedule A. 
 

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 The share exchange shall be for all shares, warrants, options and any form of security ownership in the Company, so that upon the Closing, BBLU shall the sole stockholder of the Surviving Corporation.
 (ii)
 BBLU shall pay $55,000 in cash, plus interest, and $22,500 in cash, plus interest, to pay the debts of the Company, as shown on the books of the Company, as set forth in Schedule B attached hereto, which shall be paid upon the Closing by BBLU or the Surviving Corporation.
 (iii)
 BBLU shall pay to Edward Davis $25,000 in cash at Closing in full and complete payment of $250,000 of indebtedness owed to Davis by the Company pursuant to the terms and conditions of the Intelligent Power Stock Offering dated November 28, 2011.  Edward Davis has agreed to accept $25,000 in full payment and provide BBLU with a general release in the form of Exhibit 2(a) attached hereto.
 (iv)
 BBLU or the Surviving Corporation shall also pay to Paulson Investment Company (“Paulson”) a cash fee equal to three percent (3%) of the $3,500,000 Merger Consideration ($105,000) within three (3) days after the Closing, per a fee Agreement attached hereto as Exhibit 2(a)(iv), which terminated an agreement between BBLU and Paulson and an agreement between the Stockholders and Paulson.
 (b)
 Tender of Certificates.
 (i)
 Exchange of the Company Certificates.  In consideration of the Merger Consideration, the Stockholders shall surrender at the Closing all certificates for Company Shares together with powers endorsed in blank (the “Certificates”).  Until surrendered as contemplated by this Section 2(b), each Certificate shall be deemed at any time after the Closing to represent only the right to receive a pro rata portion of the Merger Consideration as contemplated by Section 2(a)(i) above.
 (ii)
 Options, Warrants and Treasury Stock.  All outstanding options, warrants and other convertible securities and any Company Shares owned and held in treasury by the Company, shall be surrendered at the Closing and retired by the Company.  All securities of the Company other than the Company Shares shall be cancelled without payment of any consideration therefor and shall cease to exist.
 (iii)
 Transfer Books; No Further Ownership Rights in the Stock.  Upon the Closing Date, the transfer books of the Company shall be closed, and thereafter there shall be no further registration of transfers of Company Shares on the records of the Company by the Stockholders.  From and after the Closing Date, the holders of the Certificates evidencing ownership of the Company Shares outstanding immediately prior to the Closing shall cease to have any rights with respect to such Company Shares, except as otherwise provided for herein or by applicable law.  If, after the Closing, Company Shares are presented to the Exchange Agent for any reason, they shall be cancelled and exchanged as provided in this Section 2(b).
 (iv)
 Directors and Officers.  At the Closing, the officers of the Company immediately prior to the Closing shall be the officers of the Surviving Corporation per the terms of their employment agreements.  The Board of Directors of the Surviving Corporation shall
 

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 elect the officers of the Company until the expiration of their respective terms and until their successors have been elected and qualified.  The Board of Directors of the Surviving Corporation after the Closing Date shall initially consist of:  Ed Davis, Rod Friesen, Rob Potts and Johnny Thomas.
 (v)
 Additional Actions.  If at any time after the Closing BBLU shall consider or be advised that any deeds, bills of sale, assignments, assurances or any other actions or things are necessary or desirable to vest, perfect or confirm of record or otherwise in the Surviving Corporation, its right, title or interest in, to or under any of the rights, properties or assets of the Company or otherwise carry out this Agreement, the officers and directors of BBLU shall be authorized to execute and deliver, in the name and on behalf of the Company, all such deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf of the Company, all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties or assets in the Surviving Corporation or otherwise to carry out this Agreement.
 (vi)
 Other Effects of Merger.  Upon and after the Effective Date, title to all property owned by each of the Company and Newco shall vest in the Surviving Corporation without reversion or impairment, and the Surviving Corporation shall automatically have all of the liabilities of each of the Company and Newco.  The Merger shall have all further effects as specified in the applicable provisions of the OBCA.
 (vii)
 Taking of Necessary Action; Further Action.  If, at any time after the Effective Date, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest in the Surviving Corporation full right, title and possession to all assets, property, rights, privileges, powers and franchises of the Company, the officers and directors of the Surviving Corporation are fully authorized to take, and will take, all such lawful and necessary action.
 (viii)
 Articles of Incorporation and Bylaws.
 (1)
 At the Effective Date, the Articles of Incorporation of Newco, as in effect immediately prior to the Effective Date, shall be the Articles of Incorporation of the Surviving Corporation, until thereafter amended, as provided by law.
 (2)
 At the Effective Date, the Bylaws of Newco, as in effect immediately prior to the Effective Date, shall be the Bylaws of the Surviving Corporation, until thereafter amended, as provided by law or in such Bylaws.
 (ix)
 Intent.  The parties intend that, for federal income tax purposes, the Merger qualify as a reorganization within the meaning of Sections 368(a)(1)(A) and 368 (a)(2)(E) of the Code, and that this Agreement constitutes a plan of reorganization within the meaning of Section 368(b) of the Code.  Each party shall treat the Merger consistently with the foregoing, including filing the information and maintaining the records required by Treasury Regulations Section 1.368-3, and shall not take any position inconsistent therewith.  No party shall take any action that would cause the Merger not to qualify as a reorganization within the meaning of Sections 368(a)(1)(A) and 368(a)(2)(E) of the Code.
 

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 (c)
 Effective Date of the Merger.  In the event that the Merger is consummated, the parties hereto agree that the Merger shall be accounted for as if such Merger had occurred at the close of business on the Closing Date (the “Effective Date”).  In the event that the Merger is consummated, BBLU shall realize any operating profit or loss from the operation of the business of the Company after the Effective Date.  Accordingly, the Stockholders agree to consult with BBLU on any material issues or contracts that relate to a period of time prior to the Closing and Effective Date.  Furthermore, the Stockholders agree not to enter into any new capital obligations or capital expenditures, which relate to the Company prior to the Closing, except in the Ordinary Course of Business.
 Section 3.
 Other Agreements.
 (a)
 Lock-Up of BBLU Shares.  The Merger Consideration includes BBLU Shares, which are restricted common stock, which may not be sold for the time periods specified below as measured from the Closing Date, which includes compliance with the terms and conditions of Rule 144 under the Securities Act of 1933 and the Lock-up Agreements.  Each recipient of any of the BBLU Shares agrees to the following terms and conditions to be contained in a Lock-up Agreement (the “Lock-up Agreement”):
 (i)
 All of the BBLU Shares received by Ed Davis and Rod Friesen and related family members (i.e., 1,039,507 shares (75% of the Company’s Shares based upon 4,951,000 of 6,588,903 shares)) as founders shares (“Founders”) shall not be eligible for sale until eight (8) months from the Closing Date (the “Lock-up Period”).  Thereafter, the four parties included as Founders shall be allowed to sell BBLU Shares based upon the following schedule:
 (1)
 The Friesen Family Irrevocable Trust: 3,150 shares per week for 102 weeks.
 (2)
 Rod Friesen:  2,150 shares per week for 102 weeks.
 (3)
 Ed Davis:  3,150 shares per week for 102 weeks.
 (4)
 Thereafter, there shall be no restrictions or limitations on the selling of BBLU Shares by Founders or their assigns.
 (b)
 The 343,893 BBLU Shares received by third party investors and consultants (“Investors”) shall not be eligible for sale prior to six (6) months from the Closing Date.  During months seven (7) through twelve (12) after the Closing Date, the Investors shall each be allowed to sell ten percent (10%) per month of the number of BBLU Shares issued to them at the Closing.  After that date, there shall be no limitation or restrictions on the selling of their BBLU Shares.
 (c)
 BBLU may permit and assist the Stockholders in making sales of their BBLU Shares during the Lock-up Period, if the Stockholders and the Surviving Corporation so desire, when opportunities such as the following are available:
 (i)
 Block purchases by investors are requested.
 

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 (ii)
 The BBLU Shares held by the Stockholders may be included in a secondary offering registration statement, which offers shares of BBLU for sale to the public, provided the investment bankers and management of BBLU agree that such offerings would not be adverse to the funding opportunity for BBLU.
 (iii)
 When daily trading volumes and prices reasonably permit, as determined by BBLU.
 (d)
 Employment and Non-Competition Agreement.  In addition to the Merger Consideration as described above, at the Closing: (i) Ed Davis, as CEO, and (ii) Rod Friesen, as Vice President of Business Development of the Surviving Corporation shall each enter into an Employment Agreement with the Surviving Corporation in the form annexed hereto as Exhibit 3(d)(i) and a Non-Competition Agreement in the form annexed hereto as Exhibit 3(d)(ii).
 All employees, other than the Stockholders, as well as providers of contract services, will continue under existing contracts they had with the Company, unless amended by the Stockholders and the Surviving Corporation jointly, as may be appropriate.  The employment agreements of the non-Stockholders shall contain non-compete clauses as currently exist in their employment agreements.
 (e)
 After the Closing, all consultants of the Surviving Corporation shall be eligible to receive non-qualified options to purchase shares of Common Stock of BBLU under the BBLU 2009 Equity Incentive Plan, based on a formula for years of service and salary, as set forth on Schedule 3(e) attached hereto.  Schedule 3(e) shall also include a list of all Company consultants and the number of options being granted to each consultant at closing.
 Section 4.
 Representations and Warranties of the Stockholders.  The Company and each of the Stockholders severally and not jointly, warrants and represents to BBLU and Newco as follows (as used herein, “Stockholders’ best knowledge” or “to the best knowledge of the Stockholders” shall mean information actually known by the Stockholders without due inquiry):
 (a)
 Ownership of Shares.  The Stockholders are the owners, beneficially and of record, of the Company Shares, which constitute one hundred percent (100%) of the issued and outstanding shares of capital stock of the Company.  The Company Shares are the sole voting stock of the Company and are duly authorized, validly issued, fully paid and non-assessable.  The Company Shares have not been pledged, mortgaged or otherwise encumbered in any way and there is no lien, mortgage, charge, claim, liability, security interest or encumbrance of any nature against the Company Shares.  There are no options, warrants, rights of subscription or conversion, calls, commitments, agreements, arrangements, understandings, plans, contracts, proxies, voting trusts, voting agreements or instruments of any kind or character, oral or written, to which the Stockholders or the Company are a party, or by which the Stockholders or the Company are bound, relating to the issuance, voting or sale of the Company Shares or any authorized but unissued shares of capital stock of the Company or of any securities representing the right to purchase or otherwise receive any such shares of capital stock.  There are no stockholders agreements, preemptive rights or other agreements, arrangements, groups, commitments or understandings, oral or written, that have not been disclosed to BBLU and Newco, relating to the voting, issuance, merger or disposition of shares of the Company or the conduct or management of the Company by its Board of Directors.
 

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 (b)
 Capacity; Organization; Standing; Capitalization.  The Stockholders have full capacity to enter into and perform under this Agreement and all other agreements and instruments to be entered into in connection with the Merger contemplated hereby, and to consummate such Merger, and no other consent or joinder of any other persons or corporations is required to consummate such Merger.  The Company has no subsidiaries.  Neither the Stockholders nor the Company have any interest in any entity, directly or indirectly, in businesses competitive with those of the Company or BBLU.  This Agreement has been, and each of the other agreements and instruments executed hereunder (the “Other Agreements”) will at the Closing, be duly executed and delivered by the Stockholders.  This Agreement constitutes, and each of the Other Agreements will constitute, the legal, valid and binding obligation of the Stockholders enforceable in accordance with its respective terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights generally or by general equitable principles.
 (c)
 Conflicts.  Neither the execution and delivery of this Agreement or any of the other agreements to which such Stockholder is a party, nor the consummation or performance of the Merger will, directly or indirectly (with or without notice or lapse of time):
 (i)
 contravene, conflict with or result in a violation of any Legal Requirement or any Order to which such Stockholder, or the Company is subject; or
 (ii)
 contravene, conflict with or result in a violation of any of the terms or requirements of, or give any Governmental Body the right to revoke, withdraw, suspend, cancel, terminate or modify, any Governmental Authorization that is held by the Company;
 (iii)
 except for any such contravention, conflict or violation which would not reasonably be expected to make illegal or materially delay or impair the consummation of the Merger, or;
 (iv)
 conflict with or result in a violation or breach of, or constitute (with or without notice or passage of time) a default under, or result in or give any person the right of termination, cancellation, acceleration or modification in or with respect to, or result in or give to any person any additional rights under, or result in the creation or imposition of an Encumbrance upon the assets of the Company under, any Applicable Contract or other arrangement to which the Company or any of the Stockholders is a party or is bound.
 (d)
 No Finder’s Fee.  The Stockholders have not created any obligation for any finder’s, investment banker’s or broker’s fee in connection with the Merger other than the disclosed fee covered by a cash payment to Paulson referenced in Section 2(a)(iii).
 (e)
 Purchase Entirely for Own Account.  The BBLU Shares proposed to be acquired by each Stockholder hereunder will be acquired for investment for each such Stockholder’s own account, and not with a view to the resale or distribution of any part thereof, and the Stockholder has no present intention of selling or otherwise distributing the BBLU Shares, except in compliance with applicable securities laws, and in accordance with the terms and conditions of the form of Lock-Up Agreement attached hereto as Exhibit 3(a)(i).
 

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 (f)
 Available Information.  Each Stockholder has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of investment in BBLU.
 (g)
 Non-Registration.  Each Stockholder understands that the BBLU Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”) and if issued in accordance with the provisions of this Agreement, will be issued by reason of a specific exemption from the registration provisions of the Securities Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Stockholder’s representations as expressed herein.
 (h)
 Restricted Securities.  Each Stockholder understands that the BBLU Shares are characterized as “restricted securities” under the Securities Act inasmuch as this Agreement contemplates that, if acquired by the Stockholder pursuant hereto, BBLU Shares would be acquired in a Merger not involving any public offering.  Each Stockholder further acknowledges that if BBLU Shares were issued to the Stockholder in accordance with the provisions of this Agreement, such BBLU Shares may not be resold without registration under the Securities Act or the existence of an exemption therefrom.  In this connection, each Stockholder represents that such Stockholder is familiar with Rule 144 promulgated under the Securities Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.
 (i)
 Legends.  It is understood that the BBLU Shares will bear one or all of the following legends:
 (i)
 “THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.  THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.”
 (ii)
 Any legend required by the “blue sky” laws of any state to the extent such laws are applicable to the securities represented by the certificate so legended.
 (j)
 Schedule 13D; Section 16(b).  If the number of BBLU Shares acquired by any Stockholder, when aggregated with all other shares of common stock of BBLU owned by such Stockholder at such time would result in the Stockholder beneficially owning (as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) and the rules thereunder) in excess of 4.99% of the then issued and outstanding BBLU Shares and the BBLU Shares are then registered under Section 12(g) of the Exchange Act, such Stockholder shall comply with the disclosure requirements of Schedule 13D and, if such amount exceeds 9.99%, such Stockholder shall also comply under the reporting obligations of Sections 16(a) and 16(b) of the Exchange Act and the rules promulgated thereunder.  BBLU shall provide to Stockholders, at BBLU’s sole cost and expense, the services of BBLU’s legal counsel to advise and prepare all such documents and filings as may be necessary to allow Stockholders to comply with the requirements of the Exchange Act.
 

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 (k)
 Corporate Organization; Etc.  The Company is duly organized, validly existing and in good standing under the laws of the state of Oregon and has full corporate power and authority and possesses all governmental franchises, licenses, permits, authorizations and approvals necessary to engage it to own, lease or otherwise hold its properties and assets and to conduct its businesses as presently conducted, other than such franchises, licenses, permits, authorizations and approvals the lack of which, individually or in the aggregate, has not and would not reasonably be expected to have a Material Adverse Change on the Company, or on the ability of the Company to perform its obligations under this Agreement or on the ability of the Company to consummate the Merger.  The Company is duly qualified or licensed to do business as a foreign corporation in good standing in the jurisdictions where the nature of its business or its ownership or leasing of its properties make such qualification necessary except where the failure to so qualify would not reasonably be expected to have a Material Adverse Change.  The copies of the Organizational Documents and all amendments thereto of the Company heretofore delivered to BBLU are complete and correct copies of such instruments as presently in effect.
 (l)
 Capitalization of Companies.  The Stockholders own in the aggregate all of the issued and outstanding equity interest of the Company, in each case free and clear of all Encumbrances, other than Encumbrances which will be extinguished on or prior to the Closing Date except for the security interest of a former shareholder in the Escrowed Shares.
 (m)
 Authority; Execution and Delivery; Enforceability.  The Company has all requisite corporate power and authority to execute and deliver this Agreement and to consummate the Merger.  The execution and delivery by the Company of this Agreement and the consummation by the Company of the Merger have been duly authorized and approved by the Board of Directors of the Company and no other corporate proceedings on the part of the Company are necessary to authorize this Agreement and the Merger.  When executed and delivered, this Agreement will be enforceable against the Company in accordance with its terms.
 (n)
 Consents.  No governmental license, permit or authorization, and no registration or filing with any court, governmental authority or regulatory agency, is required in connection with the execution, delivery or performance of this Agreement by the Company.  The Company shall execute, deliver and perform its obligations under this Agreement, and no consent or other approval of any other party is required to be obtained by the Company in connection with the Merger contemplated hereby.
 (o)
 Legal Proceedings.
 (i)
 Neither the Stockholders in their capacity as stockholders and/or as officers or directors of the Company, nor the Company is a party to any pending litigation, arbitration or administrative proceeding or, to the best of Stockholders’ knowledge, to any investigation, and no such litigation, arbitration or administrative proceeding or investigation that might result in any Material Adverse Change in the financial condition, business or properties of the Company or of the Stockholders is threatened.  To the best knowledge of the Company and the Stockholders, they have not received notice of any complaints, claims or threats, plans or intentions to discontinue commercial relations or purchases from any customer of the Company, any purchaser of goods or services from the Company, any employee or independent contractor significant to the conduct or operation of the Company or its businesses or any party to any
 

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 agreement to which the Company is a party, other than in the Ordinary Course of Business for a service business serving large numbers of customers.
 (ii)
 To the Stockholders’ best knowledge, the Company is under no obligation with respect to the return of goods in the possession of customers.
 (p)
 Encumbrances.  To the Stockholders’ best knowledge, there are no liens, mortgages, deeds of trust, claims, charges, security interests or other encumbrances or liabilities of any type whatsoever to which any of the assets of the Company (the “Fixed Assets”), and the Company’s inventory (the “Inventory”), are subject.
 (q)
 Financial Statements.
 (i)
 The audited financial statements of the Company for the time periods required by SEC regulations, together with the related notes and schedules (the “Audited Financials”), are being prepared by BBLU using information supplied by the Company and the Stockholders pursuant to Section 12(c) below, prior to and immediately after the Closing Date and shall be:  (A) in accordance with the books of account and records of the Company; (B) which present fairly, and are true, correct and complete statements of the financial condition and the results of operations of the Company as, at, and for the periods therein specified, and (C) do not include or omit to state any fact which renders the Financials materially misleading.
 (ii)
 The Stockholders shall deliver to BBLU pursuant to Section 12(c) below, prior to the Closing Date, the unaudited consolidated balance sheet as of a date ended the last complete month prior to the Closing Date (the “Balance Sheet Date”) and the consolidated income statement for the period ended at the Balance Sheet Date (the “Unaudited Financials”) and a copy of the bank statements with balances at the Closing Date.  The Unaudited Financials give a true and fair view, in all significant aspects, of the consolidated balance sheet position of the Company as at the Balance Sheet Date, and its consolidated results, and the Stockholders shall use their best efforts to have them contain sufficient and appropriate information for its adequate interpretation and comprehension according to U.S. GAAP.  The Stockholders recognize that the records as delivered to BBLU may require adjustments to be in accordance with GAAP.  BBLU shall work with the Stockholders to make such adjustments using the information provided by the Stockholders and the Company.  The Stockholders, as officers of the Company shall sign said audited financial statements once they are prepared.
 (iii)
 No Unknown Liabilities, Etc.  As of the Balance Sheet Date, the Company had no liability or obligation of any nature (absolute, accrued, contingent or otherwise) not otherwise disclosed herein which is not fully reflected or reserved against in the Balance Sheet, to the best efforts of the Company, in accordance with GAAP, should have been shown or reflected in the Balance Sheet.  There has been no material change in the assets (other than cash) or liabilities (other than tax liabilities calculated to the best efforts of the Company in accordance with GAAP) of the Company since the Balance Sheet Date.  BBLU is preparing said balance sheets and financial information using information provided by the Company and the Stockholders on a timely basis.
 (iv)
 Except as and to the extent shown or provided for in the Financials or the notes and schedules thereto or as disclosed in any of the Schedules to this Agreement or such
 

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 current liabilities as may have been incurred since December 31, 2012 in the ordinary course of business, the Company has no liabilities or obligations (whether accrued, absolute, contingent or otherwise) which might be or become a charge against the assets or liabilities of the Company; as of the Balance Sheet Date, there was no asset used by the Company in its operations that has not been reflected in the Financials and, except as set forth in the Financials, no assets have been acquired by the Company since such date except in the ordinary course of business.
 (v)
 Except as disclosed in the Unaudited Financials and the information provided by the Company and the Stockholders, there has been no decrease in stockholders’ equity as compared with the amount shown for such stockholders’ equity as at the Balance Sheet Date, and no Material Adverse Changes in the financial position of the Company since the Balance Sheet Date.
 (r)
 Tax Matters.  The Company has timely filed all federal, state and local income tax returns and has timely filed with all other appropriate governmental agencies all sales, ad valorem, franchise and other tax (including any real estate, personal property, or any other tax that may be due in connection with the Fixed Assets), license, gross receipts and other similar returns and reports required to be filed by the Company.  The Company has reported all taxable income and losses on those returns on which such information is required to be reported and paid or provided for the payment of all taxes due and payable by the Company on said returns or taxes due pursuant to any assessment received by it, including without limitation, any taxes required by law to be withheld and/or paid in connection with any officer’s or employee’s compensation or due pursuant to any assessment received by it.  The Stockholders have made available to BBLU for inspection copies of income tax returns that are true and complete copies of the federal and applicable state, local or other income tax returns filed by the Company for all taxable years of operation for the Company, including any other open tax periods.  The Company shall bear all expenses and responsibilities for the filing of federal and applicable state, local or other income tax returns and reports of the Company for the taxable year ended December 31, 2012, but BBLU and the Company hereby covenant and agree that the Company will not file any amended income tax returns for any period without first notifying the Stockholders.  All tax liabilities of the Company arising through the end of the taxable year ended December 31, 2012 and that are currently due have been paid.  All tax liabilities of the Company arising after December 31, 2012, and that are currently due have been paid or adequately disclosed and the properly reserved for on the books and records and financial statements of the Company.  The Stockholders are responsible for the payment of all of their own taxes for all periods through the Closing Date.  No federal or applicable state, local or other tax return of the Stockholders or the Company for any period has been or is currently under audit by the Internal Revenue Service or any state, local or other tax authorities.  No claim has been made by federal, state, local or other authorities relating to any such returns or any audit.  For purposes of this Section 4(r), the word “timely” shall mean that such returns were filed within the time prescribed by law for the filing thereof, including the time permitted under any applicable extensions.  The Stockholders and the Company are not aware of any facts, which they believe would constitute the basis for the proposal of any tax deficiencies for any unexamined year.  Except as set forth on Schedule 4(r), all taxes which the Company is required by law to withhold and collect have been duly withheld and collected, and have been timely paid over to the proper authorities to the extent due and payable or they have been fully disclosed to BBLU.
 

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 (s)
 Accounts Receivable and Inventory.
 (i)
 Accounts Receivable.  The accounts receivable of the Company reflected in the Unaudited Financials as at the Balance Sheet Date, and the accounts receivable acquired by the Company since such date are valid subsisting claims for the aggregate amounts thereof reflected in the Unaudited Financials net of the reserves or allowances for doubtful receivables reflected in the Financials or thereafter in the Company’s books and records uniformly maintained in accordance with the financial statements, accounted for in accordance with generally accepted accounting principles, and the Stockholders know of no reason that would make such accounts receivable, net of such amounts as the Company has reserved on its books as of the Balance Sheet Date, taken as a whole not collectible.
 (ii)
 Inventory.  Except as set forth on Schedule 4(s), the inventory of the Company reflected in the Financials as of May 31, 2013 and the inventory acquired by the Company since such date (a) has been purchased in the ordinary course of business, (b) has been fully paid for unless otherwise reflected in the Financials, (c) is marketable or adequate provision for obsolescence has been provided and (d) Stockholders know of no reason that would make such inventory, net of such amounts as the Company has reserved on its books as of May 31, 2013, taken as a whole, not marketable.
 (t)
 Title and Condition of Properties.  The Company does not own any real property, except as may be reflected in the financial information provided.  Except as set forth on Schedule 4(t), the Company has good, marketable title to all properties and assets, real and personal, tangible and intangible, reflected in the Unaudited Financials and all properties acquired subsequent to the Balance Sheet Date, which have not been disposed of in the ordinary course of business.  Said property is subject to no mortgage, lien, deed of trust, claim, security interest, liability, conditional sales agreement, easement, right-of-way or any other encumbrance except as may be filed in the Ordinary Course of Business.
 Schedule 3(t) of this Agreement contains an accurate list of all leases and other agreements under which the Company is lessee of any personal property.  Each of the real property and personal property leases and agreements is in full force and effect and constitutes the legal, valid and binding obligation of the parties thereto.
 All personal property, machinery and equipment which are material to the business, operations or condition (financial or otherwise) of the Company is in operating condition and, subject to routine maintenance and ordinary wear and tear, have been maintained in accordance with reasonable industry standards and is suitable for the purpose for which it is used.  To the best of their knowledge, neither the Stockholders nor the Company is aware of or have received notice of, the violation of any applicable zoning regulation, ordinance or other law, order, regulation or requirement in force on the date hereof relating to the Company’s business or its owned or leased real or personal properties, with which the Company has not complied or is in the process of complying as may be appropriate.
 (u)
 Description of Material Contracts.  Schedule 4(u) of this Agreement contains a complete and correct list as of the date hereof of certain contracts, which are representative of the contracts entered into by the Company and its customers.  Said Schedule shall include copies of all manufacturers rep and/or distributor agreements.  Other agreements, contracts and
 

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 commitments, obligations and understanding are set forth in other Schedules delivered hereunder, of the following types written or oral to which the Company is a party, under which it has any rights or by which it or any of its properties is bound, as of the date hereof: (a) mortgages, indentures, security agreements and other agreements and instruments relating to the borrowing of money or extension of credit; (b) employment and consulting agreements with annual compensation in excess of $50,000; (c) collective bargaining agreements; (d) bonus, profit-sharing, compensation, stock option, pension, retirement, deferred compensation or other plans, agreements, trusts, funds or arrangements for the benefit of employees (whether or not legally binding); (e) sales agency, manufacturer’s representative or distributorship agreements; (f) agreements, orders or commitments for the purchase by the Company of materials, supplies or finished products exceeding $25,000 in the aggregate from any one person; (g) agreements, orders or commitments for the sale by the Company of its products or services exceeding $25,000; (h) agreements or commitments for capital expenditures in excess of $25,000 for any single project (it being warranted that the commitment for all undisclosed contracts for such agreements or commitments does not exceed $25,000 in the aggregate); (i) agreements relating to research; (j) agreements relating to the payment of royalties; (k) brokerage or finder’s agreements; (l) joint venture agreements; and (m) other agreements, contracts and commitments which individually or in the aggregate for any one party involve any expenditure by the Company of more than $25,000.
 The Company has made available to BBLU copies of all written agreements, contracts, commitments, obligations and undertakings, together with all amendments thereto that are in its possession, listed on the Schedules hereto.  All such agreements, contracts, commitments, obligations and undertakings are in full force and effect and, all parties to, or otherwise bound by, such agreements, contracts, commitments, obligations and undertakings have performed all obligations required to be performed by them to date and the Company is not in default and no event, occurrence, condition or act exists which gives rise to (or which with notice or the lapse of time, or both, could result in) a default or right of cancellation, acceleration or loss of contractual benefits under, any such contract, agreement, commitment, obligation or undertaking.  There has been no threatened cancellations thereof, and there are no outstanding disputes, other than in the Ordinary Course of Business for a service business serving a large customer base under any such contract, agreement, commitment, obligation or undertaking.  To the Stockholders’ best knowledge, no consent of any party is required under any such contract, agreement, commitment, obligation or undertaking, which would make such agreements not binding and in full force and effect as of the Closing Date.  Any contracts, agreements, leases or commitments held in the name of any of the Stockholders and set forth in the Schedules hereto shall be assigned to either Newco or the Company prior to the Closing Date.
 Each contract, lease, instrument and commitment required to be described in the Schedules hereto is, on the date hereof, and will be at the Closing, in full force and effect and is and will constitute a valid and binding obligation of the Company and the respective parties to such agreements, and there is not, under any such contract, lease, instrument or commitment, any existing default by the Company or such other parties or any event that, with notice, lapse of time or both, would constitute a default by the Company or such other parties in respect of which adequate steps have not been taken to cure such default or to prevent a default from occurring or continuing.  Any contracts, leases or commitments held in the names of any of the Stockholders
 

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 and listed on the Schedules shall be assigned either to Newco or the Company prior to the Closing Date.
 To the Company’s best knowledge, the material suppliers, customers and clients of the Company will continue to supply and purchase from the Company after the Closing, except as may change in the Ordinary Course of Business.
 (v)
 Proprietary Rights.  The Company owns all right, title and interest in and to, or otherwise possesses legally enforceable rights, or is licensed to use, all patents, copyrights, technology, software, software tools, know-how, processes, trade secrets, trademarks, service marks, trade names, Internet domain names and other proprietary rights used in or necessary for the conduct of the Company’s business as conducted to the date of this Agreement, including, without limitation, the technology, information, databases, data lists, data compilations, and all proprietary rights developed or discovered or used in connection with or contained in all versions and implementations of the Company’s World Wide Web sites or any product or service which has been or is being distributed or sold by the Company or currently is under development by the Company or has previously been under development by the Company (collectively, including such Web site, the “Company Products”), free and clear of all liens, claims and encumbrances (including without limitation linking, licensing and distribution rights) (all of which are referred to as “Company Proprietary Rights”).  In addition, the Company is not aware of any legal restrictions or impediments that would prevent the Company from conducting its business as proposed to be conducted.  Schedule 4(v) of this Agreement contains an accurate and complete in all material respects (i) description of all patents, trademarks (with separate listings of registered and unregistered trademarks), trade names, Internet domain names and registered copyrights in or related to the Company Products or otherwise included in the Company Proprietary Rights and all applications and registration statements therefor, including the jurisdictions in which each such Company Proprietary Right has been issued or registered or in which any such application of such issuance and registration has been filed, (ii) list of all licenses and other agreements with third parties (the “Third Party Licenses”) relating to any material patents, copyrights, trade secrets, software, inventions, technology, know-how, processes or other proprietary rights that the Company is licensed or otherwise authorized by such third parties to use, market, distribute or incorporate in Company Products (such patents, copyrights, trade secrets, software, inventions, technology, know-how, processes or other proprietary rights are collectively referred to as the “Third Party Technology”) and (iii) list of all licenses and other agreements with third parties relating to any material information,  compilations, data lists or databases that the Company is licensed or otherwise authorized by such third parties to use, market, disseminate, distribute or incorporate in Company Products.  To the best of Stockholders’ Knowledge, all of the Company’s patents, copyrights, trademark, trade name or Internet domain name registrations related to or in the Company Products are valid and in full force and effect; and consummation of the Merger contemplated by this Agreement will not alter or impair any such rights.  No claims have been asserted or threatened against the Company (and the Company is not aware of any claims which are likely to be asserted or threatened against the Company or which have been asserted or threatened against others relating to Company Proprietary Rights or Company Products) by any person challenging the Company’s use, possession, manufacture, sale or distribution of Company Products under any Company Proprietary Rights (including, without limitation, the Third Party Technology) or challenging or questioning the validity or effectiveness of any material license or agreement relating thereto
 

 14
 

 
 

 

 (including, without limitation, the Third Party Licenses) or alleging a violation of any person’s or entity’s privacy, personal or confidentiality rights.  There is no valid basis for any claim of the type specified in the immediately preceding sentence which could in any material way relate to or interfere with the continued enhancement and exploitation by the Company of any of the Company Products.  To the Stockholders’ best knowledge, none of the Company Products nor the use or exploitation of any Company Proprietary Rights in its current business infringes on the rights of or constitutes misappropriation of any proprietary information or intangible property right of any third person or entity, including without limitation any patent, trade secret, copyright, trademark or trade name and the Company has not been sued in any suit, action or proceeding which involves a claim of such infringement, misappropriation or unfair competition.
 The Company has not granted any third party any right to manufacture, reproduce, distribute, market or exploit any of the Company Products or any adaptations, translations, or derivative works based on the Company Products or any portion thereof.  The Company has not knowingly granted any third party any right to allow users of the Company’s World Wide Web site to link to other World Wide Web or Internet sites.  Except with respect to the rights of third parties to the Third Party Technology, no third party has any express right to manufacture, reproduce, distribute, market or exploit any works or materials of which any of the Company Products are a “derivative work” as that term is defined in the United States Copyright Act, Title 17, U.S.C. Section 101.
 (i)
 The Company has at all times used commercially reasonable efforts customary in its industry to treat the Company Proprietary Rights related to Company Products and Company Components as containing trade secrets and has not disclosed or otherwise dealt with such items in such a manner as intended or reasonably likely to cause the loss of such trade secrets by release into the public domain.
 (ii)
 To the Company’s best knowledge, no employee, contractor or consultant of the Company is in violation in any material respect of any term of any written employment contract, patent disclosure agreement or any other written contract or agreement relating to the relationship of any such employee, consultant or contractor with the Company or, to the Company’s knowledge, any other party because of the nature of the business conducted by the Company.  
 (iii)
 To the Stockholders’ best knowledge, each person presently employed by the Company (including independent contractors, if any) with access authorized by the Company to confidential information has executed a confidentiality and non-disclosure agreement pursuant to the form of agreement previously provided to BBLU or its representatives (See employee handbook, which has evolved over time as set forth in Schedule 3(z)).
 (iv)
 No material product liability or warranty claims have been communicated in writing to or to the best of Stockholders’ Knowledge, threatened against the Company.
 (v)
 To the Company’s knowledge, there is no material unauthorized use, disclosure, infringement or misappropriation of any Company Proprietary Rights, or any Third Party Technology to the extent licensed by or through the Company, by any third party, including any employee or former employee of the Company.  The Company has not entered into any agreement to indemnify any other person against any charge of infringement of any
 

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 Corporation Proprietary Rights, other than indemnification provisions contained in purchase orders arising in the ordinary course of business.
 (vi)
 The Company has taken all steps customary and reasonable in the industry to protect and preserve the confidentiality and proprietary nature of all Intellectual Property and other confidential information not otherwise protected by patents, patent applications or copyright (“Confidential Information”).  
 (w)
 Default; Violations or Restrictions.  Except as set forth on Schedule 4(w), the execution, delivery and performance of this Agreement and of any agreement to be executed and delivered by the Company in connection with the Merger contemplated hereby will not (or with the giving of notice or the lapse of time or both would) result in the breach of any term or provision of the Articles of Incorporation or Bylaws of the Company or violate any provision of or result in the breach of, modification of, acceleration of the maturity of obligations under, or constitute a default, or give rise to any right of termination, cancellation, acceleration or otherwise be in conflict with or result in a loss of contractual benefits to the Company, under any law, order, writ, injunction, decree, statute, rule or regulation of any court, governmental agency or arbitration tribunal or any of the terms, conditions or provisions of any contract, lease, note, bond, mortgage, deed of trust, indenture, license, security agreement, agreement or other instrument or obligation by which the Company or the Stockholders is a party or by which either of them may be bound, or require any consent, approval or notice under any law, rule or decree or any such document or instrument; or result in the creation or imposition of any lien, claim, restriction, charge or encumbrance upon the Company’s assets or interfere with or otherwise adversely affect the ability to carry on the business of the Company after the Closing Date on substantially the same basis as it is now conducted by the Company.
 (x)
 Court Orders and Decrees.  Except as set forth on Schedule 4(x), the Company has not received written or oral notice that there is outstanding, pending or threatened any order, writ, injunction or decree of any court, governmental agency or arbitration tribunal against or affecting the Company, the Company Shares or any of the Company’s assets.  The Company is in compliance in all material respects with all applicable Federal, state, county, municipal (or of any subdivision thereof) laws, regulations and administrative orders in force at any applicable time to which the Company may be subject.
 (y)
 Books and Records.  Since inception the books and records of the Company are, in all material respects, complete and correct and have been maintained in accordance with good business practice.  True and complete copies known to the Stockholders of the Articles of Incorporation and Bylaws of the Company and all amendments thereto and true and complete copies of all minutes, resolutions, stock certificates and stock transfer records of the Company since inception are contained in the minute books and stock transfer books that have been made available to BBLU for inspection and will be delivered to BBLU at the Closing.  The minute books, stock certificate books, stock transfer records and such other books and records as may be requested by BBLU, as exhibited to BBLU, and its representatives, are complete and correct in all material respects, since inception.
 (z)
 Pension and Welfare Plans.  See employee handbook, Schedule 3(z).
 

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 (i)
 Pension and Profit Sharing Plans.  Except as disclosed in Schedule 3(z) of this Agreement, the Company does not have in effect any pension, profit sharing or other employee benefit plan described under Section 3(2)(A) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).  All benefits payable under any terminated employee pension benefit plan (as such term is defined in Section 3(2)(A) of ERISA) previously maintained by the Company or to which it has previously contributed have been paid in full and/or that the Company does not have any unfunded liability in respect of any such plan to the Pension Benefit Guaranty Corporation or to the participants in such plan or to the beneficiaries of such participants.  Each such terminated plan was terminated substantially in accordance with the applicable provisions of law or any agreement or contract relating to any such plan and has been terminated without liability to the Company.
 (ii)
 Welfare Plans.  For each plan, fund, or arrangement of the Company which is an employee welfare benefit plan, whether or not currently maintained (within the meaning of ERISA Section 3(1)) (a “Welfare Plan”), the following is true:
 (1)
 each such Welfare Plan intended to meet the requirements for tax-favored treatment under Subchapter B of Chapter 1 of the Code meets such requirements;
 (2)
 there is no voluntary employees’ beneficiary association (within the meaning of Section 501(c)(9) of the Code) maintained with respect to any such Welfare Plan;
 (3)
 there is no disqualified benefit (as such term is defined in Code Section 4976(b)) which would subject the Company or BBLU to a tax under Code Section 4976(a);
 (4)
 each such Welfare Plan which is a group health plan complies and has complied with the applicable requirements of Code Section 4980B.  and would comply with Sections 9801 through 9806 if such provisions were now in effect, Title XXII of the Public Health Service Act, and the applicable provisions of the Social Security Act and is not and has not been a nonconforming group health plan under Section 5000(c) of the Code;
 (5)
 each such Welfare Plan may be amended or terminated by the Company or BBLU, on or at any time after, the Closing Date and after any advance notice to participants or similar measures required by law which are non-waivable under the Welfare Plan;
 (6)
 no such Welfare Plan provides for continuing benefits or coverage for any participant (including past, present or future retirees) or such participant’s beneficiary after termination of employment except as required by the Consolidated Omnibus Reconciliation Act of 1985 (“COBRA”) or any other state or Federal law; and
 (7)
 no claims have been made and no other events have occurred that might form the basis of a claim which has substantially increased or based on customary insurance industry practice might substantially increase, the premiums or other charges of the Company under any Welfare Plan.
 (aa)
 Insurance.  Schedule 3(aa) of this Agreement contains a correct and complete description of all policies of insurance by or on behalf of the Company in which the Company is
 

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 named as an insured party, beneficiary or loss payable payee.  The Company has at all times prior to the date hereof maintained and will at all times prior to the Closing Date maintain insurance coverage with respect to its properties, in respect of liabilities and risks prudently insured against.  The policies described in Schedule 3(aa) of this Agreement are outstanding and in force as of the date hereof.
 (bb)
 Rights of Third Parties.  The Company has not entered into any material leases, licenses, easements or other agreements, recorded or unrecorded, granting rights to third parties in any real or personal property of the Company, and no person or other corporation has any right to possession, use or occupancy of any of the property of the Company, except as customary and normal for the business.
 (cc)
 Powers of Attorney.  There are no persons, firms, associations, corporations or business organizations holding general or special powers of attorney from the Company.
 (dd)
 Labor Matters.  The Company is not a party to any collective bargaining agreement with any labor union or association.  There are no discussions, negotiations, demands or proposals that are pending or have been conducted or made with or by any labor union or association, and there are no pending or, threatened labor disputes, strikes or work stoppages that may have a material adverse effect upon the continued business or operation of the Company.  Except as set forth on Schedule 4(dd), the Company (i) is in compliance with all federal and state laws respecting employment and employment practices, terms and conditions of employment and wages and hours, and (ii) is not engaged in any unfair labor practices.
 (ee)
 Relationships with Vendors and Customers.  The Company and the Stockholders have no knowledge of any present or future conditions or state of facts or circumstances, which would materially adversely affect the Company after the Closing Date.  The Company’s relationships with its customers, clients and vendors are satisfactory, and the Company and the Stockholders have no knowledge of any facts or circumstances which might materially alter, negate, impair or in any way materially adversely affect the continuity of any such relationships including, but not limited to, the effect that such customer will stop, materially decrease the rate of, or materially change the terms (whether related to payment, price or otherwise) with respect to, buying materials, products or services from the Company, or the Surviving Corporation (whether as a result of the consummation of the Merger contemplated hereby or otherwise).  Except as set forth on Schedule 3(ee) of this Agreement, neither the Company have received any indication from any material supplier of the Company to the effect that such supplier (i) is planning to implement any material price changes other than in the ordinary course of business or will stop or (ii) is terminating, canceling or threatening to terminate or cancel any commitments, contracts or arrangements with the Company, and there are no disputes with any material supplier of the Company.  The Company and the Stockholders have no knowledge of any material outstanding claims of any of its customers or clients presently outstanding, pending or threatened against the Company, except for aged accounts payables claims.  The Company and the Stockholders have no knowledge of any present or future condition or state of facts or circumstances which would prevent the business of the Company from being carried on by the Surviving Corporation after the Closing Date in essentially the same manner as it is presently being carried on.
 

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 (ff)
 Approvals and Authorizations.  The Company has obtained all necessary consents, approvals and authorizations in connection with the Merger contemplated hereby which are required by law or otherwise in order for the Company to continue all of its present business following the Closing Date.
 (gg)
 Compensation Plans.  The employee handbook, Schedule 3(z) of this Agreement contains a correct and complete description of all material compensation plans and arrangements: bonus and incentive plans and arrangements; deferred compensation plans and arrangements; stock purchase and stock option plans and arrangements: hospitalization and other life.  health or disability insurance or reimbursement programs: holiday, sick leave, severance, vacation, tuition reimbursement, personal loan and product purchase discount policies and arrangements, policy manuals and any other plans or arrangements providing for benefits for employees of the Company.
 (hh)
 Governmental Licenses.  Schedule 3(hh) of this Agreement contains a correct and complete list of all material governmental and administrative consents, permits, appointments, approvals, licenses, certificates and franchises which are (i) necessary for the operation of the Company, and (ii) required in connection with Stockholders’ execution, delivery or performance of this Agreement, all of which have been obtained by the Company and are in full force and effect.
 (ii)
 Brokers.  Other than the relationship with Paulson referenced in Section 2(a)(iii), no other agent, broker, investment banker, person, or firm acting on behalf of any of the Stockholders, the Company or any firm or corporation affiliated with any of them, or under its authority, is or will be entitled to a financial advisory fee, brokerage commission, finder’s fee or other like payment in connection with the Mergers contemplated hereby.
 (jj)
 Compliance With Laws.
 (i)
 The operations and activities of the Company have previously and continue to comply with all applicable Federal, state and local laws, statutes, codes, ordinances, rules, regulations, permits, judgments, orders, writs, awards, decrees or injunctions (collectively, the “Laws”), as in effect on or before the date of this Agreement, including, without limitation, all Laws relating to seed labeling and all rules and regulations of the Occupational Safety and Health Administration.  Neither the ownership of the Company nor the conduct of the business of the Company as presently conducted conflicts with the rights of any other person, firm or corporation or violates, or with or without the giving of notice or the passage of time, or both, will violate, conflict with or result in a default right to accelerate or loss of rights under, any terms or provisions of its Articles of Incorporation or Bylaws as presently in effect, or any lien, encumbrance, mortgage, deed of trust, lease, license, agreement, understanding, or Laws to which the Company is a party or by which it may be bound or affected.  The Company has received no written notice or communication from any third party asserting a failure to comply with any Laws, nor has the Company received any written notice that any authority or third party intends to seek enforcement against the Company to compel compliance with any such Laws.
 (ii)
 There are no existing claims or threatened claims against the Company, with respect to, or as direct or indirect result of, the presence on or under, or the escape, seepage, leakage, spillage, discharge, or emission discharging, from the real property of the Company of
 

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 any “Hazardous Material,” including, without limitation, any losses, liabilities, damages, injuries, costs, expenses, reasonable fees of counsel or claims asserted or arising under the Comprehensive Environmental Response, Compensation and Liabilities Act (“CERCLA”), any so-called “Super Fund” or “Super Lien” law or any other applicable federal, state or local statute, law, ordinance, code, rule, regulation, order or decree now or at any time hereafter in effect, regulating, relating to or imposing liability or standards of conduct concerning any Hazardous Material.
 (iii)
 Since the date first acquired or leased by the Stockholders or the Company, the Stockholders and Corporation have not placed any “Hazardous Material” on or under the real property owned or leased by the Company and, to the best of Stockholders’ knowledge, there has been no “Hazardous Material” on or under the real property owned or leased by the Company.
 (iv)
 Neither the Company nor the Stockholders, nor any officer, employee or agent of the Company acting on its behalf, nor any other person acting on its behalf, has, directly or indirectly, within the past three (3) years given or received or agreed to give or receive any gift or similar benefit to any customer, supplier, governmental employee or other person who is or may be in a position to help or hinder the Company (or assist the Company in connection with any actual or proposed acquisition) which (i) might subject the Company to any damage or penalty in any civil, criminal or governmental litigation or proceeding, (ii) if not given or received in the past might have had an adverse effect on the assets, business or operation of the Company, or (iii) if not continued in the future, might adversely affect the assets, the business or the operations or prospects of the Company, or which might subject the Company to suit or penalty in any private or governmental litigation or proceeding.
 (kk)
 Internal Accounting Controls.  The Company does not maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) acquisitions are executed in accordance with management’s general or specific authorizations, (ii) acquisitions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  The Company has not established disclosure controls and procedures for the Company and has not designed such disclosure controls and procedures to ensure that material information relating to the Company is made known to the officers by others within those entities.  The Company’s officers have not evaluated the effectiveness of the Company’s controls and procedures.  Except as set forth in Section 4(kk), since the Balance Sheet Date, there have been no significant changes in the Company’s internal controls or, to the Company’s knowledge, in other factors that could significantly affect the Company’s internal controls.  All of this Section 4(kk) is to the Stockholders’ best knowledge.
 (ll)
 No Additional Agreements.  The Company does not have any agreement or understanding with any Stockholders with respect to the Merger contemplated by this Agreement other than as specified in this Agreement.
 

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 (mm)
 Disclosure.  The Company confirms that neither it nor any person acting on its behalf has provided any Stockholders or its respective agents or counsel with any information that the Company believes constitutes material, non-public information except insofar as the existence and terms of the proposed Merger hereunder may constitute such information and except for information that will be disclosed by BBLU under a current report on Form 8-K.  The Company understands and confirms that the Stockholders will rely on the foregoing representations and covenants in effecting the Merger.  All disclosure provided to the Stockholders regarding the Company, its business and the Merger contemplated hereby, furnished by or on behalf of the Company (including the Company’s representations and warranties set forth in this Agreement) are true and correct in all material respects and do not contain any untrue statements of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.
 (nn)
 Relationships With Related Persons, Guarantees.  Except as otherwise set forth in Schedule 3(b)(iii) of this Agreement, and except through or related to its ownership of the Company Shares, neither the Stockholders nor any Affiliate of the Stockholders has any outstanding Contract with the Company.  The Stockholders have not personally guaranteed any of the obligations of the business of the Company, except for unspecified guarantees that were initiated during the startup phase of the Company that may not have been released.
 (oo)
 Benefits.  All information on accrued holiday, vacation, sick or other compensation or benefits to which employees of the Company are entitled to receive from the Company have been provided by the Company.  The Company has an employee manual, which sets forth the Company’s policies with respect to its employees, and there are no policies other than as set forth in the employee handbook, Schedule 3(z) of this Agreement.
 (pp)
 Schedules.  The Stockholders and the Company have delivered to BBLU complete and correct schedules in all material respects (the “Schedules”), in form and substance reasonably acceptable to BBLU, as of the date of this Agreement.
 (qq)
 No Legal or Tax Advice.  The Stockholders are not relying on any legal or tax advice from BBLU in connection with the Merger contemplated by this Agreement.
 (rr)
 Accuracy.  No representation, warranty, covenant or statement by the Stockholders or the Company in this Agreement, including the Schedules and Exhibits attached hereto and the certificates furnished or to be furnished to BBLU pursuant hereto, contains or will contain any untrue statement of a material fact, or omits or will omit to state a material fact required to be stated herein or therein or necessary to make the statements contained herein or therein in light of the circumstances under which they were made, not false or materially misleading.
 Section 5.
 Representations and Warranties of BBLU and Newco.  Each of BBLU and Newco jointly and severally warrants and represents to the Stockholders as follows:  (as used herein, “Newco’s or BBLU’s best knowledge” or “to the best knowledge or Newco or BBLU” shall mean information actually known by Newco or BBLU without due inquiry):
 (a)
 Capacity.  Each of Newco and BBLU has full right, power and capacity to execute, deliver and perform its obligations under this Agreement and the other documents
 

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 required to be executed by Newco or BBLU in connection herewith and to consummate the Merger contemplated hereby.  The execution and delivery of this Agreement does not, and the consummation of the Merger contemplated by this Agreement will not, constitute a breach of any term or provision of the Articles of Incorporation or Bylaws of Newco or the Certificate of Incorporation or Bylaws of BBLU, or constitute a default under any material law, rule, regulation, indenture, instrument, mortgage, deed of trust, or other agreement or instrument to which Newco or BBLU is a party or by which either is bound.
 (b)
 Organization.
 (i)
 Newco is a corporation duly organized, validly existing and in good standing under the laws of the State of Oregon, and Newco has corporate power and authority to carry on its business as now conducted and to own, lease or operate the properties and assets now used by it in connection therewith.  Newco is duly qualified and in good standing to do business in each jurisdiction in which the nature of its business or the ownership or leasing of its properties make such qualification necessary.
 (ii)
 BBLU is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada, and has corporate power and authority to carry on its business as now conducted and to own, lease or operate the properties and assets now used by it in connection therewith.  BBLU is duly qualified and in good standing to do business in each jurisdiction in which the nature of its business or the ownership or leasing of its properties make such qualification necessary.
 (c)
 Authority; No Conflict.
 (i)
 This Agreement constitutes the legal, valid and binding obligation of Newco and BBLU, enforceable against them in accordance with its terms, except as may be limited by bankruptcy, moratorium and insolvency laws and other laws affecting the rights of creditors generally and except as may be limited by general principles of equity.  The execution and delivery by Newco and BBLU of this Agreement and the consummation by Newco and BBLU of the Merger have been duly authorized and approved by the Boards of Directors of Newco and BBLU and no other corporate proceedings on the part of Newco and BBLU are necessary to authorize this Agreement and the Merger.  Upon the execution and delivery by it of the Other Agreements to which Newco is a party and the execution and delivery thereof by each other party thereto, such Other Agreements will constitute the legal, valid and binding obligations of Newco, enforceable in accordance with their respective terms, except as may be limited by bankruptcy, moratorium and insolvency laws and other laws affecting the rights of creditors generally and except as may be limited by general principles of equity.  Newco has the power, authority and capacity to execute and deliver this Agreement and the Other Agreements to which it is a party and to perform its respective obligations under this Agreement and such Other Agreements.
 (ii)
 Neither the execution and delivery of this Agreement or any of the Other Agreements, nor the consummation or performance of the Merger will, directly or indirectly (with or without notice or lapse of time):
 

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 (1)
 conflict with or result in a violation or breach of, constitute (with or without notice or passage of time) a default under, result in or give any person the right of termination, cancellation, acceleration or modification in or with respect to, result in or give to any person any additional rights under, result in the creation or imposition of an Encumbrance upon the assets of Newco under any agreement or other arrangement to which Newco is a party or is bound; or
 (2)
 contravene, conflict with or result in a violation of any of the terms or requirements of, or give any Governmental Body the right to revoke, withdraw, suspend, cancel, terminate or modify, any Governmental Authorization that is held by Newco.
 (iii)
 Newco is not and will not be required to give any notice to, or obtain any Consent from, any Person in connection with the execution and delivery of this Agreement or any of the Other Agreements or the consummation or performance of the Merger.
 (d)
 Capital Structure.  As of the Closing Date the authorized capital stock of BBLU shall consist of 100,000,000 shares of common stock, par value $.001 per share, and 25,000,000 shares of preferred stock, par value $.001 per share.  As of June 26, 2013 (i) 25,795,857 shares of BBLU’s common stock were issued and outstanding, (ii) 1,231,402 shares of preferred stock, convertible to 12,314,020 shares of common stock were outstanding, and no shares of BBLU’s common stock or preferred stock are held by BBLU in its treasury; and (iii) warrants to purchase an aggregate of 26,657,906 shares of common stock are issued and outstanding.  Except as set forth above and in the BBLU SEC filings, no shares of capital stock or other voting securities of BBLU were issued, reserved for issuance or outstanding.  All outstanding shares of the capital stock of BBLU are, and all such shares that may be issued prior to the date hereof will be when issued, duly authorized, validly issued, fully paid and non-assessable and not subject to or issued in violation of any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the Nevada Revised Statutes, BBLU’s Articles of Incorporation, BBLU’s Bylaws or any Contract to which BBLU or Newco is a party or otherwise bound.  There are no other commitments, Contracts, arrangements or undertakings of any kind to which BBLU or Newco is a party or by which any of them is bound (i) obligating BBLU or Newco to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock or other equity interests in, or any security convertible or exercisable for or exchangeable into any capital stock of or other equity interest in, Newco, (ii) obligating BBLU or Newco to issue, grant, extend or enter into any such option, warrant, call, right, security, commitment, Contract, arrangement or undertaking, or (iii) that give any person the right to receive any economic benefit or right similar to or derived from the economic benefits and rights occurring to holders of the capital stock of BBLU.  As of the date of this Agreement, there are not any outstanding contractual obligations of BBLU to repurchase, redeem or otherwise acquire any shares of capital stock of BBLU.  BBLU is not a party to any agreement granting any security holder of BBLU the right to cause BBLU to register shares of the capital stock or other securities of BBLU held by such security holder under the Securities Act, other than the pending preferred share offering.  The BBLU Shares to be issued pursuant to this Agreement as well as under the BBLU 2009 Equity Incentive Plan will, when issued, be duly authorized, validly issued, fully paid and non-assessable.
 (e)
 Consents and Approvals.  No governmental license, permit or authorization, and no registration or filing with any court, governmental authority or regulatory agency, is required
 

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 in connection with the execution, delivery or performance of this Agreement by Newco or BBLU.  Each of Newco and BBLU shall execute, deliver and perform its obligations under this Agreement, and no consent or other approval of any other party is required to be obtained by Newco or BBLU in connection with the Mergers contemplated hereby.
 (f)
 Binding Obligation.  This Agreement has been duly executed and delivered by Newco and BBLU and constitutes the legal, valid and binding obligation of Newco and BBLU, enforceable against Newco and BBLU in accordance with its terms, except to the extent that such enforceability may be limited by general principles of equity or bankruptcy, insolvency and other similar laws affecting the enforcement of creditors’ rights generally.  All action of the Board of Directors of Newco and BBLU and all other corporate action necessary to authorize the execution, delivery and performance of this Agreement and the consummation of the Mergers contemplated hereby has been duly and validly taken.
 (g)
 Brokers: Finders.  No agent, broker, investment banker, person or firm acting on behalf of Newco or BBLU or any firm or corporation affiliated with Newco or BBLU or under the authority of either Newco or BBLU is or will be entitled to any brokers’ or finders’ fee or any other commission or similar fee in connection with the Merger contemplated hereby except for the cash consideration to Paulson referenced in Section 2(a)(iii).
 (h)
 Accuracy.  No representation, warranty, covenant or statement by Newco or BBLU in this Agreement, including the Schedules and Exhibits attached hereto and the certificates furnished or to be furnished to the Stockholders pursuant hereto, contains or will contain any untrue statement of a material fact, or omits or will omit to state a material fact required to be stated herein or therein or necessary to make the statements contained herein or therein in light of the circumstances under which they were made, not false or materially misleading.
 (i)
 SEC Documents; Undisclosed Liabilities
 (i)
 BBLU has filed all reports, schedules, forms, statements and other documents required to be filed by BBLU with the SEC since September 11, 2010 pursuant to Sections 13(a), 14 (a) and 15(d) of the Exchange Act (the “BBLU SEC Documents”).
 (ii)
 As of its respective filing date, each BBLU SEC Document complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to such BBLU SEC Documents, and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  Except to the extent that information contained in any BBLU SEC Documents has been revised or superseded by later filed BBLU SEC Documents, none of the BBLU SEC Documents contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  The consolidated financial statements of BBLU for the years ended December 31, 2011 and December 31, 2012 included in the BBLU SEC Documents comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, have been prepared in accordance with GAAP (except, in the case of
 

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 unaudited statements, as permitted by the rules and regulations of the SEC) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of BBLU and its consolidated subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods shown (subject, in the case of unaudited statements, to normal year-end audit adjustments).
 (iii)
 Except as set forth in the BBLU SEC Documents, BBLU has no liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) required by GAAP to be set forth on a balance sheet of BBLU or in the notes thereto.  
 (j)
 Absence of Certain Changes or Events.  Except as disclosed in the BBLU SEC Documents, from the date of the most recent audited financial statements included in the BBLU SEC Documents to the date of this Agreement, BBLU has conducted their business only in the ordinary course.
 (k)
 Litigation.  Except as disclosed in the BBLU SEC Documents, there is no suit, action or proceeding pending or, to the knowledge of BBLU or Newco, threatened against or affecting BBLU or Newco (and BBLU and Newco are not aware of any basis for any such suit, action or proceeding) that, individually or in the aggregate, has had or would reasonably be expected cause a Material Adverse Change, nor is there any Judgment outstanding against BBLU or Newco that has had or would reasonably be expected to cause a Material Adverse Change on BBLU or Newco.
 (l)
 Compliance with Applicable Laws.  Except as disclosed in the BBLU SEC Documents, BBLU and Newco is in compliance with all applicable Laws, including those relating to occupational health and safety and the environment, except for instances of noncompliance that, individually and in the aggregate, have not had and would not reasonably be expected to cause a Material Adverse Change.  Except as set forth in the BBLU SEC Documents, BBLU or Newco have not received any written communication during the past two years from a Governmental Entity that alleges that BBLU or Newco is not in compliance in any material respect with any applicable Law.
 (m)
 Listing and Maintenance Requirements.  BBLU’s Shares are listed for trading on the OTC QB maintained by the Financial Industry Regulatory Authority, Inc. (“FINRA”).  BBLU has no reason to believe that it will not in the foreseeable future continue to be, in compliance with the listing and maintenance requirements for continued listing of the BBLU Shares on the OTC QB and/or the OTC Markets.
 (n)
 Reorganization.
 (i)
 Newco is a newly formed Oregon corporation that was organized solely to engage in the Merger.  Newco does not have any assets or any liabilities and has not engaged in any business or activity.
 (ii)
 Newco is, and immediately prior to the Merger will be, a wholly owned subsidiary of BBLU.
 

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 (iii)
 Newco has no plan, intention or commitment to issue or sell (a) any of its capital stock, (b) any security of Newco treated as equity for federal income tax purposes, (c) any security that is convertible or exchangeable into any of the foregoing, or (d) any right to subscribe for or acquire any of the foregoing, and no such securities or rights outstanding other than the common stock of Newco that is owned by BBLU.
 (iv)
 Neither BBLU nor Newco has any plan or intention to cause the Surviving Corporation to issue additional shares of its stock or any other security of Surviving Corporation that would result in BBLU losing control of the Surviving Corporation within the meaning of Section 368(c) of the Code prior to or immediately after the Merger.
 (v)
 Prior to the Merger, the Company has acquired no BBLU Shares (and no related person to BBLU within the meaning of Treasury Regulations Section 1.368-1(e)(3) has acquired any stock of the Company), either directly or through any transaction, agreement or arrangement with another person.  The Company has no plan or intention to acquire or redeem (and no related person to the Company within the meaning of Treasury Regulations Section 1.368-1(e)(3) has any plan or intention to acquire) any of the BBLU stock issued in the Merger, other than pursuant to the terms of this Agreement, either directly or through any transaction agreement or arrangement with another person.
 (vi)
 BBLU has no plan or intention to (a) liquidate the Surviving Corporation (including any transaction that would be treated as a liquidation for federal income tax purposes), (b) merge the Surviving Corporation with or into another corporation (including any entity treated as a corporation for federal income tax purposes), (c) sell or otherwise dispose of the stock of the Surviving Corporation, except for transfers of stock to corporations controlled by BBLU in accordance with Section 368(a)(2)(C) of the Code, or (d) cause the Surviving Corporation to sell or otherwise dispose of any of its assets or any of the assets acquired from Newco, except for dispositions made in the ordinary course of business or transfers of assets to a corporation controlled by the Surviving Corporation in accordance with Section 368(a)(2)(C) of the Code.
 (vii)
 Newco has no liabilities assumed by the Surviving Corporation in the Merger, and will not transfer any assets to the Surviving corporation in the Merger subject to any liabilities.
 (viii)
 Following the Merger, BBLU will cause the Surviving Corporation to continue its historic business or use a significant portion of its historic business assets in a business, in each case within the meaning of Treasury Regulations Section 1.368-1(d).
 (ix)
 BBLU and Newco will each pay their respective expenses, if any, incurred in connection with the transaction contemplated by this Agreement.
 (x)
 BBLU is not an investment company within the meaning of Section 368(a)(2)(F)(iii) and (iv) of the Code.
 Section 6.
 Survival of Representations and Warranties; Indemnification.
 

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 (a)
 Survival of Representations and Warranties.  All representations and warranties made by the Stockholders, the Company, Newco and BBLU in this Agreement, including without limitation all representations and warranties made in any Exhibit or Schedule hereto or certificate delivered hereunder, shall survive the Closing until the first anniversary of the Closing Date (the “Survival Date”); provided, however, that all representations and warranties made by the Stockholders in Sections 4(q), (r), (z) and (jj) hereof shall survive the Closing until and through one (1) month after the expiration of the applicable statute of limitations (the “Extended Survival Date”); provided, however , that representations which are the basis for claims asserted under this Agreement prior to the expiration of such applicable time periods shall also survive until the final resolution of those claims.  Covenants and other executory obligations contained in this Agreement shall survive the Closing.  The right to indemnification, payment of damages and other remedies based on representations, warranties, covenants and obligations in this Agreement shall not be affected by any investigation conducted or any knowledge acquired (or capable of being acquired) at any time, whether before or after the Closing Date, with respect to the accuracy or inaccuracy of or compliance with any such representation, warranty, covenant or obligation.
 (b)
 Indemnity by Stockholders.  Provided that the Merger contemplated by this Agreement is closed, the Stockholders hereby agree, severally and not jointly, to indemnify, defend and hold harmless Newco and BBLU and their respective Affiliates, shareholders, partners, Stockholders, directors, officers, employees and other agents and representatives from and against all liabilities, losses, costs or damages whatsoever (including expenses and reasonable fees of legal counsel) (“Claims”) arising out of or relating to Claims made prior to the Survival Date or the Extended Survival Date, if applicable, in the event that it is determined that such Claims arise out of or from or are based upon (i) the inaccuracy in any material respect of any representation or warranty contained in Section 4 made by the Stockholders, (ii) the non-performance by the Stockholders in any material respect of any covenant, agreement or obligation to be performed by the Stockholders under this Agreement; (iii) the assessment of any material federal, state local or other tax liabilities due and payable by the Company for all periods through the Closing Date.
 (c)
 Indemnification by Newco and BBLU.  Provided that the Merger contemplated by this Agreement is closed, Newco and BBLU hereby agrees to indemnify, defend and hold harmless the Stockholders from and against all Claims arising out of or relating to Claims made prior to the Survival Date or the Extended Survival Date, if applicable, in the event that it is determined that such Claims arise out of or from or are based upon (i) the inaccuracy in any material respect of any representation or warranty contained in Section 5 by Newco and BBLU; (ii) the non-performance by Newco and BBLU in any material respect of any covenant, agreement or obligation to be performed by Newco and BBLU under this Agreement; and (iii) any liabilities arising out of the operation of the business of the Company after the Closing Date.
 (d)
 Defense of Claims.  Whenever any Claim shall arise for indemnification hereunder, the party entitled to indemnification (the “Indemnitee”) shall notify the indemnifying party (the “Indemnitor”) in writing within thirty (30) days after the Indemnitee has actual knowledge that it is entitled to indemnification of such Claim constituting the basis for such Claim (the “Notice of Claim”).  The Notice of Claim shall specify all facts known to the
 

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 Indemnitee giving rise to such indemnification claim and the amount or an estimate of the amount of the liability arising therefrom.
 If the facts giving rise to any such indemnification shall involve any actual, threatened or possible claim or demand by any person against the Indemnitee, the Indemnitor shall be entitled (without prejudice to the right of the Indemnitee to participate at its expense through co-counsel of its own choosing) to contest or defend such claim at his expense and through counsel of his own choosing if he gives written notice of his intention to do so to the Indemnitee within ten (10) days after receipt of the Notice of Claim; provided that Indemnitor diligently prosecutes or defends such claim.
 The Indemnitee shall not settle any claim that would give rise to liability on the part of the Indemnitor under the indemnity contained in this Section without the written consent of the Indemnitor, which consent shall not unreasonably be withheld.  If a firm offer is made to settle a claim or litigation defended by the Indemnitee and the Indemnitor refuses to accept such offer within twenty (20) days after receipt of written notice from the Indemnitee of the terms of such offer, then, in such event, the Indemnitee shall continue to contest or defend such claim and shall be indemnified pursuant to the terms hereof.  Provided, however, that in the event the Indemnitor refuses to accept such offer to settle a claim as described above and the Indemnitee continues to contest or defend such claim, the indemnification provided for herein shall be deemed to include the value of management’s time spent in connection with the defense of such claim.  If a firm offer is made to settle a claim or litigation and the Indemnitor notifies the Indemnitee in writing that the Indemnitor desires to accept and agree to such settlement, but the Indemnitee elects not to accept or agree to it, the Indemnitee may continue to contest or defend such claim or litigation and.  in such event, the total maximum liability of the Indemnitor to indemnify or otherwise reimburse the Indemnitee hereunder with respect to such claim or litigation shall be limited to and shall not exceed the amount of such settlement offer, plus reasonable out-of-pocket costs and expenses (including reasonable attorneys’ fees and disbursements) to the date of notice that the Indemnitor desires to accept such settlement.
 Notwithstanding any provision of this Agreement to the contrary, neither Stockholders’ nor Newco’s maximum liability for indemnification shall exceed the Merger Consideration.
 Notwithstanding any provision of this Agreement to the contrary, no claim for indemnification pursuant to this Section 6 by the Indemnitee shall be asserted or claimed except for the amount of such Claim in excess of the aggregate, the sum of $25,000 (the “Stockholders’ Basket”).  Any Loss suffered by Newco for payment of any insurance deductible in connection with any proceedings shall be excluded from the Stockholders’ Basket.
 All claims for indemnification against the Stockholders shall be satisfied by the Stockholders severally and not jointly, at their option, either in cash or in BBLU Shares at their then Market Price after a final judgment by a court of competent jurisdiction.
 (e)
 Notwithstanding any provisions of this Agreement to the contrary, the remedies available under this Section 6 shall be the sole and exclusive remedies of BBLU as between BBLU and Stockholders in relation to this Agreement, but this Section 6 shall not affect any legal or equitable rights, if any, that the Stockholders or any of them may have to seek indemnification or contribution among the Stockholders or any of them.
 

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 Section 7.
 Covenants of the Stockholders and the Company.  The Stockholders and the Company hereby covenant and agree:
 (a)
 Further Assurances.  The Stockholders hereby agree that, from time to time at the reasonable request of BBLU and without further consideration, they shall execute and deliver such additional instruments and take such other action BBLU may reasonably require to convey, assign, transfer and deliver the Company Shares and otherwise to carry out the terms of this Agreement.
 (b)
 Public Announcements.  BBLU may issue a press release or other announcement of this Agreement, the Other Documents and the Merger contemplated hereby and thereby in such form as shall be determined by BBLU in its sole discretion, provided that BBLU shall provide the Stockholders with the contents of any such press release and a reasonable opportunity to comment thereon prior to its public release, except to the extent that a requirement of any Applicable Law renders it impracticable to consult with the Stockholders in advance of such release.  None of the Company, the Stockholders or their respective Affiliates, officers, stockholders, employees or agents shall issue or cause the issuance or the publication of any press release or any other public statement or announcement with respect to this Agreement, the Other Documents or the Merger contemplated hereby or thereby, without the prior review and written consent of BBLU in each specific instance.
 (c)
 Affiliate Transactions.  On or prior to the Closing Date, all Indebtedness and other amounts owing under Contracts (other than documents related to the Merger and employment, restrictive covenant, confidentiality and similar agreements with employees of the Company) between the Company, any Affiliate of the Company, or any officer, director, manager, or spouses, parents, children or siblings of any director, or officer or member of the Company or Affiliate of any of the foregoing (other than the Company), on the one hand, and the Company, on the other hand, will be paid in full, and the Company will terminate and will cause any such Affiliate of the Company, or officer, director, manager, or spouses, parents, children or siblings of any director, officer or member of the Company or Affiliate of any of the foregoing to terminate, each such Contract with the Company or any Subsidiary thereof, including, but not limited to any management services agreements, between any such Person and the Company, without any obligation thereunder surviving such termination.  Prior to the Closing, except as expressly contemplated by this Agreement or any other document related to the Merger, neither the Company nor any Subsidiary thereof will enter into any Contract or amend or modify in any material respect any existing Contract, or engage in any transaction outside the Ordinary Course of Business consistent with past practice or not on an arm’s-length basis, with the Company or any such Affiliate of the Company, or officer, director, manager, or spouses, parents, children or siblings of any director, officer or member of the Company or Affiliate of any of the foregoing.
 (d)
 Notice and Cure.  If the Company obtains knowledge of any event, transaction or circumstance occurring after the date of this Agreement that causes or will cause any condition set forth in Section 9 to be incapable of ever being satisfied, it will notify BBLU promptly in writing of, and contemporaneously will provide BBLU with true and complete copies of any and all information or documents relating to such event, transaction or circumstance.  No notice given pursuant to this Section 7(d) shall have any effect on the representations, warranties, covenants or agreements contained in this Agreement for purposes of determining satisfaction of
 

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 any condition contained herein or in any way limit the remedies available to the Purchaser hereunder.
 (e)
 Stockholder Release.  Effective as of the Closing Date, each Stockholder on behalf of itself and each of its Affiliates hereby releases and forever discharges the Company, and its officers, directors, shareholders and Affiliates, from any and all actions, causes of action, suits, debts, accounts, claims, contracts, demands, agreements, controversies, judgments, obligations, damages and liabilities of any nature whatsoever in law or in equity, whether currently known or unknown, suspected or claimed, whether pursuant to contract, statute or otherwise, in each case, arising out of events occurring on or prior to the Closing.
 Section 8.
 Covenants of Newco and BBLU.  Newco and BBLU hereby covenant and warrant as follows:
 (a)
 Closing Documents.  Newco and BBLU shall execute and deliver all instruments and documents required as a condition precedent to the Closing and take all actions required to carry out the terms of this Agreement and to consummate the Merger contemplated hereby.
 (b)
 Noninterference.  Newco and BBLU shall, not take or omit to take any action that (i) if taken or omitted on or before the date of this Agreement, would make untrue any of the representations and warranties contained in Section 5 of this Agreement, or (ii) would interfere with Newco’s or BBLU’s ability to perform or would prevent performance of any of its obligations under this Agreement or any of the other agreements or instruments provided for herein.
 (c)
 Fulfillment of Conditions.  Each party shall take all commercially reasonable steps necessary or desirable and proceed diligently and in good faith to satisfy each of the conditions to the obligations to the other parties in this Agreement.
 Section 9.
 Conditions Precedent to the Obligations of Newco and BBLU.  The obligations of Newco and BBLU under this Agreement are subject to the following conditions:
 (a)
 There shall not have been any breach of the representations, warranties, covenants and agreements of the Stockholders or the Company contained in this Agreement or the Schedules and Exhibits hereto, and all such representations and warranties shall be true at all times on and before the Closing.
 (b)
 The Stockholders and the Company shall have performed and complied with all covenants, agreements and conditions required by this Agreement to be performed or complied with by them prior to or at the Closing Date.  All documents and instruments required in connection with this Agreement shall be reasonably satisfactory in form and substance to Newco and BBLU.
 (c)
 There shall have been no Material Adverse Change in the condition (financial or otherwise), business, assets, liabilities, properties, results of operations, or earnings of the Company since the Balance Sheet Date.
 

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 (d)
 There shall be no outstanding actions or threats of action by any party that may materially adversely effect the condition (financial or otherwise), business, assets, liabilities, properties, results of operations, or earnings of the Company.
 (e)
 Newco and BBLU shall have received certificates dated the Closing Date and signed by the Stockholders and the Company, certifying that the conditions specified in Sections 9(a), (b), (c) and (d) above have been fulfilled except to the extent that any non-fulfillment was disclosed in writing to BBLU prior to the Closing Date.
 (f)
 The Company and the Stockholders shall have obtained and delivered to Newco and BBLU any required consents or approvals of any third parties whose consent is required to the Merger contemplated hereunder.
 (g)
 Newco and BBLU shall have received originals or certified copies, reasonably satisfactory in form and substance to Newco and BBLU, of all such corporate documents of the Company as Newco or BBLU shall reasonably require, including without limitation the following:
 (i)
 The Articles of Incorporation of the Company and all amendments thereto and restatements thereof certified as of a recent date by the Secretary of State of Oregon;
 (ii)
 The Bylaws of the Company and all amendments thereto and restatements thereof certified as of the Closing Date by an officer of the Company;
 (iii)
 Certificate of existence of the Secretary of State of Oregon, certifying as of a recent date that the Company is duly organized, validly existing and in good standing under the laws of that State;
 (iv)
 Copies of the minutes and resolutions of the Board of Directors and stockholders of the Company showing the authorization and approval by such Boards of the execution and delivery by the Company to BBLU of this Agreement and of the agreements and instruments provided for herein and of the performance of the obligations of the Company under this Agreement and such other instruments and agreements, certified as of a recent date by the Secretary or another officer of the Company; and
 (v)
 A certificate of incumbency identifying the officers and directors of the Company immediately before Closing.
 (h)
 Newco shall have received evidence that all authorized signatories on accounts, safe deposit boxes, lockboxes and other depositories of funds of the Company at Pacific West Bank, are only Persons designated by the Surviving Corporation.
 (i)
 The Company and the Stockholders shall have executed and delivered to Newco and BBLU an assignment or consent to all of the leases described in Schedule 3(t) of this Agreement.
 (j)
 The Stockholders shall have executed and delivered to Newco and BBLU the assignment or endorsement in favor of Newco and BBLU of coverage under the insurance
 

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 policies maintained by the Stockholders covering the Company described to in Schedule 4(aa) of this Agreement.
 (k)
 Newco and BBLU shall have received from each of the key employees the Non-Competition Agreement in the form of Exhibit 2(b)(ii) attached hereto.
 (l)
 The Surviving Corporation shall have entered into an employment agreement with Ed Davis and Rod Friesen in the form of Exhibit 2(b)(i) and made arrangements that they deem satisfactory with such “key personnel” of the Company and have received all letters of resignation from the Company as Newco and BBLU deem necessary.
 (m)
 The Company shall have delivered to BBLU evidence, in form and substance reasonably satisfactory to BBLU, of the termination and release of all recorded outstanding Liens and financing statements on the assets and properties of the Company, other than those associated with any agreement, listed in the disclosure schedules or listed in this agreement.
 (n)
 Each of the Stockholders and key employees shall have delivered BBLU a Lock-Up Agreement substantially in the form attached hereto as Exhibit 2(a).
 (o)
 Stockholders shall have obtained and delivered to BBLU any and all required waivers of default and/or consent to assumption of debt by the Company’s lenders and/or the Newco or the Surviving Corporation shall have entered into replacement borrowing facilities on terms reasonably acceptable to BBLU.
 (p)
 All key employees and providers of contract services as of May 31, 2013 shall have continued under their existing contracts through the Closing Date.
 (q)
 Stockholders shall have delivered to BBLU the Certificates evidencing the Company Shares.
 Section 10.
 Conditions Precedent to the Stockholders’ and the Company’s Obligations.  The obligations of the Stockholders and the Company under this Agreement are subject to the following conditions:
 (a)
 There shall not have been any breach of the representations, warranties, covenants and agreements of Newco or BBLU contained in this Agreement, and all such representations and warranties shall be true at all times at and before the Closing.
 (b)
 Newco and BBLU shall have performed and complied with all agreements and conditions required by this Agreement to be performed or complied with by them.  All documents and instruments required in connection with this Agreement shall be reasonably satisfactory in form and substance to the Stockholders.
 (c)
 The Stockholders shall have received a certificate dated the Closing Date signed by each of Newco and BBLU, certifying that the conditions specified in Sections 9(a) and 9(b) above have been fulfilled.
 

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 (d)
 The Stockholders shall have received originals or certified copies, reasonably satisfactory in form and substance to the Stockholders, of the following corporate documents of Newco and BBLU:
 (i)
 A certificate of existence certifying as of a recent date that each of Newco and BBLU is a corporation in good standing under the laws of Oregon and Nevada, respectively;
 (ii)
 Copies of the minutes and resolutions of the Board of Directors of each of Newco and BBLU showing the authorization and approval by such Board of the execution and delivery by Newco and BBLU of this Agreement and the agreements and instruments provided for herein and of the performance of the obligations of Newco and BBLU under this Agreement and such other instruments and agreements, certified as of a recent date by the Secretary or another officer of Newco and BBLU; and
 (iii)
 A certificate of incumbency identifying the officers and directors of Newco and BBLU immediately before Closing.
 (e)
 BBLU shall have delivered to the Stockholders certificates of BBLU Shares evidencing the Merger Consideration as set forth in Section 2(a).
 Section 11.
 Conditions Precedent to Obligations of the Stockholders, the Company, Newco and BBLU.  The obligations of the Stockholders, the Company, Newco and BBLU to complete this Merger shall be subject to the fulfillment at or prior to the Closing Date of the following conditions:
 (a)
 Due Diligence.  The Stockholders, Newco and BBLU shall have been afforded the opportunity to complete their due diligence and conduct a review of the business, the Patents and intellectual property and prospects of the other, and shall be reasonably satisfied as to such business and prospects.
 (b)
 No Injunctions.  No action or proceeding shall have been instituted or threatened by any public authority or private person prior to the Closing before any court or administrative body to restrain, enjoin or otherwise prevent the consummation of this Merger or to recover any damages or obtain other relief as a result of this Merger.
 (c)
 Consents.  Any consent to the Merger considered by the Stockholders, Newco or BBLU to be necessary or advisable under any agreement or contract, the withholding of which might have, in the judgment of the Stockholders, Newco or BBLU, a Material Adverse Change on the financial condition of the other party shall have been obtained.
 (d)
 Corporate Proceedings.  All corporate and other proceedings in connection with the Merger contemplated by this Agreement, and all documents and instruments incident thereto, shall be reasonably satisfactory in substance and form to the Stockholders, Newco, BBLU and their counsel, and the Stockholders, Newco, BBLU and their counsel shall have received all certificates, documents and instruments, or copies thereof, certified if requested, as may be reasonably requested.
 Section 12.
 Deliveries.
 

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 (a)
 Deliveries of the Stockholders.  At the Closing, the Stockholders shall deliver to BBLU and Newco:
 (i)
 this Agreement executed by the Stockholders.
 (ii)
 a copy of the Confidential Purchaser Questionnaire signed by each of the Stockholders with respect to the BBLU Shares; and
 (iii)
 the Certificates with accompanying executed stock powers representing all of the Company Shares owned by the Stockholders, and identifying the certificate of the former shareholder, or an affidavit of any Stockholder that did not receive a certificate for such Stockholder’s shares of the Company, or a Lost Stock Affidavit for any lost or destroyed certificates for such Stockholder’s shares of the Company.
 (b)
 Deliveries of Newco.  At the Closing, Newco shall deliver:
 (i)
 to the Company, a certificate in the form of Exhibit 11(b), from Newco, signed by its Secretary or Assistant Secretary certifying that the attached copies of Newco’s Articles of Incorporation, Bylaws and resolutions of the Board of Directors of Newco, approving the Merger are all true, complete and correct and remain in full force and effect;
 (ii)
 to the Company, evidence of BBLU’s election of the Board of Directors of the Surviving Corporation in accordance with the terms of this Agreement;
 (iii)
 to the Stockholders, certificates representing the new BBLU Shares issued to such Stockholders as set forth in Schedule A;
 (iv)
 to each of the Stockholders, an original copy of the countersigned Lock-Up Agreement in the forms set forth as Exhibit 2(a); and
 (v)
 to the Company, the Certificate of Merger signed by Newco.
 (c)
 Deliveries of the Company.  At the Closing, the Company shall deliver to BBLU:
 (i)
 this Agreement executed by the Company; and
 (ii)
 a certificate from the Company, signed by its secretary, or similar authorized officer, certifying that the attached copies of the Company’s constituent instruments and resolutions of the Board of Directors of the Company approving the Agreement and the Merger are all true, complete and correct and remain in full force and effect.
 (iii)
 The Company will continue to deliver financial information as requested and necessary for the Surviving Corporation’s  auditor to prepare audited and unaudited financial statements as required for filing as a public company, which shall be filed in accordance with GAAP.  The Stockholders as officers of the Company continue to have an ongoing obligation to sign financial statements of the Company.
 (iv)
 At the Closing, the Company shall also deliver to BBLU, the minute books, stock transfer ledger, corporate seals, and financial books and records of the Company.
 

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 (v)
 At the Closing, the Company shall also deliver to BBLU, the Certificate of Merger signed by the Company.
 Section 13.
 [INTENTIONALLY LEFT BLANK]
 Section 14.
 Subsequent Events.
 (a)
 Access to Books and Records of the Company and Surviving Corporation.  After the Closing, BBLU hereby agrees to provide, and to cause the Surviving Corporation to provide the Stockholders and their accountants and representatives with full and free access to the books and records of the Company and Surviving Corporation and to cooperate fully with all such accountants and representatives of the Stockholders (i) so that a closing Balance sheet may be prepared on a timely basis, (ii) so that the Stockholders and BBLU and their accountants and representatives may prepare a statement of profit and loss and balance sheet of the Company as of and at the Balance Sheet Date.
 (b)
 Tax Matters.
 (i)
 The Stockholders shall (at the Company’s expense) prepare or cause to be prepared and file or cause to be filed on a timely basis all income and franchise Tax Returns with respect to the Company for taxable periods ending on or prior to the Closing Date, and the Surviving Corporation authorizes the Stockholders to do so on its behalf.  Such Tax Returns shall be prepared on a basis consistent with the similar Tax returns for the preceding periods and shall not make, amend, revoke or terminate any election or change any tax accounting methods, practice or procedure without BBLU’s consent.  The Stockholders shall give a copy of each such Tax Return to BBLU prior to filing for its review, comment and approval.  The Stockholders shall timely pay the Taxes shown to be due and owing by the Company on such Tax Returns.
 (ii)
 BBLU shall include the Surviving Corporation or cause Surviving Corporation to be included in its consolidated federal income Tax Return for the period that includes the day after the Closing Date.
 (iii)
 BBLU shall not file, or cause or permit the Surviving Corporation or any of its affiliates to file, a Tax Return of the Company or an amendment to any Tax Return of the Company with respect to any period ending on or prior to the Closing Date without the consent of the Stockholders, which consent shall not unreasonably be withheld or delayed.
 Section 15.
 BBLU’s Obligations at Closing.  At the Closing, in addition to fulfilling the conditions to closing appearing in this Agreement; BBLU shall deliver to the Stockholders the Merger Consideration as more specifically described in Section 2 hereof, together with all other documents and agreements required to be delivered by it hereunder.
 Section 16.
 The Stockholders’ Obligations at Closing.  At the Closing, in addition to fulfilling the conditions to closing appearing herein, the Stockholders shall deliver to BBLU:  the Certificate(s) representing the Company Shares free of all liens, claims and encumbrances properly transmitted, and with any and all transfer, stamp or similar taxes upon the transfer of the shares to BBLU paid in full by the Stockholders.
 

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 Section 17.
 Parties in Interest.  This Agreement shall be binding upon and shall inure to the benefit of the parties and their successors and assigns.  Nothing herein expressed or implied is intended or shall be construed to confer upon or to give any person, firm, or corporation other than the parties hereto any rights or remedies under or by reason hereof.
 Section 18.
 Entire Agreement.  This Agreement, including the Schedules and Exhibits hereto, contains the entire agreement and understanding among the parties hereto with respect to the subject matter hereof and shall not be modified or affected by any offer, proposal, statement or representation, oral or written, made by or for any party in connection with the negotiation of the terms hereof.  All references herein to this Agreement shall specifically include, incorporate and refer to the Schedules and Exhibits attached hereto which are hereby made a part hereof.  There are no representations, promises, warranties, covenants, undertakings or assurances (express or implied) other than those expressly set forth or provided for herein and in the other.  There are no representations, promises, warranties, covenants, undertakings or assurances (express or implied) other than those expressly set forth or provided for herein and in the other documents referred to herein.  This Agreement may not be modified or amended orally, but only by a writing signed by all the parties hereto.
 Section 19.
 Governing Law.  This Agreement and all rights and obligations hereunder shall be governed by, and construed in accordance with, the laws of the State of Nevada, applicable to agreements made and to be performed wholly within said State, without regard to the conflicts of laws principles of such State; provided, however, the Merger shall be governed by the laws of the state of Oregon and the OBCA.
 Section 20.
 Expenses.  The Buyer, BBLU and the Stockholders shall each pay their own expenses incidental to the preparation of this Agreement, the carrying out of the provisions of this Agreement and the consummation of the Mergers contemplated hereby.  The $4,700 of all legal fees and expenses owed to Ater Wynne LLP as set forth on Exhibit 1 to the June 28, 2013 Letter of Agreement by and between BBLU and the Company shall be paid by the Surviving Corporation.
 Section 21.
 Arbitration; Consent to Jurisdiction.  Notwithstanding any other provision in this Agreement to the contrary, controversies between BBLU and the Stockholders shall be resolved, to the extent possible, by informal meetings and discussions in good faith between the parties.  Any dispute with respect to this Agreement which absent, fraud or a misrepresentation of a material fact, cannot be made acceptable to the parties by an adjustment of the terms of this Agreement shall be resolved by mediation within sixty (60) days of the mediation request and, if mediation is not successful, then by arbitration as provided herein.
 (a)
 The parties agree first to endeavor to settle the dispute in an amicable manner by mediation administered by the American Arbitration Association (the “AAA”) or such other mediation service as is mutually agreeable to the parties to the dispute under either the AAA’s Commercial Mediation Rules or such other commercial mediation rules as is mutually agreeable to the parties to the dispute.  The mediation shall take place in Portland, Oregon with representatives of the parties present with full authority to negotiate a settlement.  The parties must participate in the Mediation process with a neutral mediator for at least ten hours over at least two days prior to commencement of any arbitration.  If a party to the dispute refuses to participate in the mediation, the party demanding mediation may either compel mediation by
 

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 seeking an appropriate order from a court of competent jurisdiction or proceed immediately to arbitration.  Thereafter, any unresolved dispute shall be settled by arbitration administered by the AAA or such other arbitration service as is mutually agreeable to the parties to the dispute in accordance with the AAA’s Commercial Arbitration Rules or such other commercial arbitration rules as is mutually agreeable to the parties to the dispute.  Judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof, and the resolution of the disputed matter as determined by the arbitrator(s) shall be binding on the parties.  Any such mediation or arbitration shall be conducted in Portland, Oregon applying Oregon law.
 Any party may, without inconsistency with this Agreement, seek from a court any interim or provisional relief that may be necessary to protect the rights or property of that party pending the establishment of the arbitral tribunal, or pending the arbitral tribunal’s determination of the merits of the controversy.
 The arbitrator(s) may award costs and fees to the prevailing party if, in his/her (their) discretion, the non-prevailing party did not prosecute the arbitration or settlement of the dispute in good faith.  “Costs and fees” for this purpose shall mean reasonable pre-award expenses of the arbitration, including fees for the arbitrator(s), administrative fees, travel expenses, out-of-pocket expenses such as copying and telephone, court costs, witness fees and attorneys’ fees.  Except as otherwise awarded by the arbitrator(s), all costs and fees shall be borne by the party incurring such costs and fees.
 The award shall be in writing and shall be signed by the arbitrator(s) and shall include a statement regarding the disposition of any statutory claim.
 Section 22.
 Severability.  If any part of this Agreement is held to be unenforceable or invalid under, or in conflict with, the applicable law of any jurisdiction, the unenforceable, invalid or conflicting part shall, to the extent permitted by applicable law, be narrowed or replaced, to the extent possible, with a judicial construction in such jurisdiction that effectuates the intent of the parties regarding this Agreement and such unenforceable, invalid or conflicting part.  To the extent permitted by applicable law, notwithstanding the unenforceability, invalidity or conflict with applicable law of any part of this Agreement, the remaining parts shall be valid, enforceable and binding on the parties.
 Section 23.
 Notices.
 (a)
 All notices, requests, consents and demands by the parties hereunder shall be delivered by hand, by recognized national overnight courier or by deposit in the United States mail, postage prepaid, by registered or certified mail, return receipt requested, addressed to the party to be notified at the addresses set forth below:
 if to the Stockholders, the Company or the Surviving Corporation to:
 Intelligent Power Inc.
 6950 SW Hampton, Suite 336
 Portland, Oregon 97123
 Attention:  Ed Davis
 Telecopier No.:  (503) 684-7909
 

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 with a copy to:
 Ater Wynne LLP
 1331 NW Lovejoy, Suite 900
 Portland, Oregon 97209
 Attention:  Ernest G. Bootsma, Esq.
 Telecopier No.:  (503) 226-0079
 if to BBLU or Newco to:
 Blue Earth, Inc.
 2298 Horizon Ridge Parkway, Suite 205
 Henderson, Nevada 89052
 Attention: Johnny R. Thomas, CEO 
 Telecopier No.:  (702) 263-1823
 with a copy to:
 Davidoff, Hutcher and Citron LLP
 605 Third Avenue
 New York, New York 10158 
 Attention:  Elliot H. Lutzker, Esq.
 Telecopier No.:  (212) 286-1884
 (b)
 Notices given by mail shall be deemed effective on the earlier of the date shown on the proof of receipt of such mail or unless the recipient proves that the notice was received later or not received, three (3) days after the date of mailing thereof.  Other notices shall be deemed given on the date of receipt.  Any party hereto may change the address specified herein by written notice to the other parties hereto.
 Section 24.
 Non-Waivers.  Neither any failure nor any delay on the part of any party to this Agreement in exercising any right, power or privilege hereunder shall operate as a waiver of any rights of such party, unless such waiver is made by a writing executed by the party and delivered to the other parties hereto; nor shall a single or partial exercise of any right preclude any other or further exercise of any other right, power or privilege accorded to any party hereto.
 Section 25.
 Assignment.  This Agreement may not be assigned by any party without the prior consent of the other parties.
 Section 26.
 Disclosure.  From and after the date of this Agreement until the Closing or the termination of this Agreement.  The Stockholders will not (i) solicit or encourage inquiries or proposals with respect to or furnish any information relating to, or participate in any negotiations or discussions concerning the sale of the Company Shares or the sale of all or a substantial portion of the assets of the Company with anyone other than Newco; or (ii) discuss the sale of the Company Shares with anyone other than Newco and other officers, directors and shareholders of the Company and the Stockholders’ advisors and (iii) unless otherwise required by law or the requirements of any applicable stock exchange, make any public announcement without prior approval of the language of such announcement by Newco.
 

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 Section 27.
 Definitions.  For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires:
 (a)
 The term “Affiliate” has the meaning prescribed by Rule 12b-2 of the regulations promulgated pursuant to the Securities Exchange Act of 1934, as amended.
 (b)
 “Applicable Contract” means any Contract (i) under which the Company has any rights, (ii) under which the Company has or is subject to any obligation or liability or (iii) by which the Company or any of the Assets are bound, including each amendment, supplement and modification (whether oral or written) in respect of any of the foregoing.
 (c)
 “Assets” means all of the assets, property, goodwill and business of every kind, nature and description, real, personal or mixed, tangible or intangible, wherever situated, whether or not reflected on the Balance Sheet, owned or leased by the Company, including, without limitation, all of the Intellectual Property Assets and all rights under Applicable Contracts constituting or held or used or useful in connection with, or related to, the Business.
 (d)
 “Business” shall mean the business conducted by the Company as of the date hereof.
 (e)
 “Code” means the Internal Revenue Code of 1986, as amended, and any successor thereto.
 (f)
 “Contract” means any agreement, contract, lease, license, sublicense, or other undertaking (whether written or oral and whether express or implied) that is legally binding.
 (g)
 “EBITDA” means, as of a particular date of determination, the Company’s earnings before interest, Taxes, depreciation, and amortization, in each case, as prepared in a manner consistent with Corporation’s past accounting practices.
 (h)
 “Encumbrance” means any charge, claim, community property interest, condition, equitable interest, mortgage, lien, option, pledge, security interest, right of first refusal, whether arising by law, by agreement or otherwise.
 (i)
 “GAAP” means generally accepted accounting principles as from time to time in effect.
 (j)
 “Governmental Authorization” means any approval, consent, license, permit, order, consent order, consent decree, waiver or other authorization issued, granted, given or otherwise made available or applied for by or under the authority of any Governmental Body or pursuant to any Legal Requirement.
 (k)
 “Governmental Body” means any (i) nation, state, county, city, town, village, district or other jurisdiction of any nature, (ii) federal, state, local, municipal, foreign or other government, (iii) governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official or entity and any court or other tribunal), (iv) multi-national organization or body or (v) federal, state, local, municipal, foreign or other
 

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 body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power of any nature.
 (l)
 “Knowledge” means, in the case of an individual, such Person’s actual knowledge, and in the case of the Stockholders, actual knowledge without due inquiry.
 (m)
 “Legal Requirement” means any federal, state, local, municipal, foreign, international, multinational or other administrative order, consent order, judgment, injunction, constitution, law, ordinance, regulation, policy, statute or treaty.
 (n)
 “Market Price” means the average of the last ten (10) day closing prices of BBLU Shares as quoted on the OTC QB or such national securities exchange which the BBLU Shares may be quoted.
 (o)
 “Material Adverse Change” means any occurrence, circumstance or condition (excluding general economic trends or conditions and trends or conditions affecting the industry in which the Company) which individually or in the aggregate, together with all other occurrences, circumstances and conditions, has resulted in, or is reasonably likely to result in, a Material Adverse Change in the results of operations financial condition or prospects of the Company taken as a whole.
 (p)
 “Material Contracts” means the Contracts identified or required to be identified on Schedule 4(k) of this Agreement.
 (q)
 “Order” means any award, decision, decree, injunction, judgment, order, consent order, ruling, or verdict entered, issued, made or rendered by any court, administrative agency or other Governmental Body.
 (r)
 “Ordinary Course of Business” means an action taken by a Person only if such action is taken in the ordinary course of the normal operations of such Person consistent with the past practices of such Person.
 (s)
 “Organizational Documents” means each of the following as currently in effect, as applicable:  (i) the charter, memorandum, articles or certificate of incorporation and the Bylaws of a corporation, (ii) the partnership agreement and any statement of partnership of a general partnership, (iii) the limited partnership agreement and the certificate of limited partnership or formation of a limited partnership, (iv) the certificate of formation or articles of organization and operating agreement of a limited liability company, (v) any similar document adopted or filed in connection with the creation, formation or organization of a Person and (vi) any amendment to any of the foregoing.
 (t)
 “Permitted Encumbrances” means (i) matters set forth on Schedule 4(f) of this Agreement; (ii) as disclosed in the Financial Statements set forth in Exhibit 4(g); (iii) liens for taxes, assessments and other governmental charges not yet due and payable or, if due, (A) not delinquent or (B) being contested in good faith by appropriate proceedings; (iv) mechanics’, workmen’s, repairmen’s, warehousemen’s, carriers’ or other like liens arising or incurred in the Ordinary Course of Business if the underlying obligations are not more than thirty (30) days past due or are being contested in good faith; and (v) liens or title-retention arrangements arising
 

 40
 

 
 

 

 under original Merger Consideration conditional sales contracts and equipment leases with third parties entered into in the Ordinary Course of Business.
 (u)
 “Person” means any individual, corporation (including any non-profit corporation), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union or other entity or Governmental Body.
 (v)
 “Subsidiary” means, as to any Person, (i) any corporation more than fifty percent (50%) of whose stock of any class or classes having by the terms thereof ordinary voting power to elect a majority of the directors of such corporation (irrespective of whether or not at the time stock of any class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time owned by such Person and/or one or more subsidiaries of such Person and (ii) any partnership, limited liability company, association, joint venture or other entity in which such Person and/or one or more subsidiaries of such Person has more than a fifty percent (50%) equity interest at the time.
 (w)
 “Tax” means all forms of taxation wherever created or imposed, whether any federal, state, local or foreign income tax; gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental (including taxes under Code Section 59A), customs duties, capital stock, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer, registration, value-added, alternative or add-on minimum or estimated tax; or other tax of any kind whatsoever, including any interest, penalty or addition thereto, whether disputed or not.
 (x)
 “Tax Return” means any return (including any information or amended return), report, statement, schedule, notice, form or other document or information filed with, delivered or submitted to, or required to be filed with, delivered or submitted to, any Governmental Body or Person in connection with the determination, assessment, collection or payment of any Tax or in connection with the administration, implementation or enforcement of or compliance with any Legal Requirement relating to any Tax.
 (y)
 “Unknown Liabilities” means each and every liability or obligation of the Company (whether accrued or contingent) arising out of any event, occurrence or condition prior to the Closing, but only to the extent such liability or obligation (A) is attributable to the period prior to the Closing Date and (B) is not (ii) disclosed in the representations and warranties of the Stockholders, the Schedules attached hereto.
 Section 28.
 Further Assurances.  Each of the parties hereto shall use its best efforts to take or cause to be taken, and to cooperate with the other party hereto to the extent necessary with respect to, all action, and to do, or cause to be done, consistent with applicable law, all things necessary, proper or advisable to consummate and make effective the Merger contemplated by this Agreement.  Without limiting the generality of the foregoing, the Stockholders and Newco shall cooperate with and provide assistance to the other in connection with the preparation and filing of all federal, state, local and foreign income tax returns which relate to the Company and relate to pre-Closing periods but which are not required to be filed until after the Closing, and shall also cooperate with and provide assistance to the other or the Company with respect to any audit of any tax returns filed prior to the Closing; provided, however, that Newco and the Company hereby covenant and agree that the Company will not
 

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 file any amended income tax return for any period prior to December 31, 2012 without first notifying the Stockholders.
 Section 29.
 Headings.  The headings contained herein are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.
 Section 30.
 Counterparts.  This Agreement may be executed and delivered in multiple counterpart copies, each of which shall be an original and all of which shall constitute one and the same agreement.  Signatures follow next page.
 [SIGNATURES ON FOLLOWING PAGE]
 

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 IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement on the date first above written.
 AGREED TO AND ACCEPTED:
 

 MAJORITY OF STOCKHOLDERS:
 

 By: /s/ Ed Davis
 Ed Davis
 

 By: /s/ Rodney D. Friesen
 Rodney D. Friesen, as Trustee of the Rodney D. 
 Friesen Living Trust
 

 By: /s/ Nancy L. Ralston
 Nancy L. Ralston, Administrative Trustee of the Friesen
 Family Irrevocable Trust
 

 INTELLIGENT POWER, INC.
 

 By: /s/ Ed Davis
 Ed Davis, CEO
 

 BLUE EARTH, INC.
 

 By: /s/ Johnny R. Thomas
 Johnny R. Thomas, CEO
 

 INTELLIGENT POWER ACQUISITION, INC.
 

 By: /s/ Johnny R. Thomas
 Johnny R. Thomas, CEO
 

 

 

 43Exhibit 10.1_63013

Exhibit 10.1 
SENSATA TECHNOLOGIES HOLDING N.V. 
2010 EQUITY INCENTIVE PLAN 
 
As amended on May 22, 2013 
ARTICLE I
ESTABLISHMENT AND PURPOSE; ADMINISTRATION
1.1    Establishment.  Sensata Technologies Holding N.V., a public limited liability company incorporated under the laws of the Netherlands (the "Company"), hereby establishes an equity incentive plan to be known as the "Sensata Technologies N.V. 2010 Equity Incentive Plan" (the "Plan").  The Plan shall become effective as of March 8, 2010 (the "Effective Date") concurrent with its adoption by the Company's management board (the "Board") on such date. 
1.2    Purpose.  The Plan is intended to promote the long‐term growth and profitability of the Company and its Subsidiaries by providing those Persons who are or will be involved in the Company's and its Subsidiaries' growth with an opportunity to acquire an ownership interest in the Company, thereby encouraging such Persons to contribute to and participate in the success of the Company and its Subsidiaries.  Under the Plan, the Company may make Awards (as defined in Section 3.1) to such present and future officers, directors, employees (including Persons to whom an offer of employment has been extended), consultants, and advisors of the Company or its Subsidiaries as may be selected in the sole discretion of the Committee (collectively, "Participants").  Participation in the Plan is voluntary.
1.3    Administration.  The Plan shall be administered by the Committee; provided that the Board may, in its discretion, at any time and from time to time, resolve that certain specified actions or determinations of the Committee shall require the approval of the Board, in which case, solely with respect to such specified actions and determinations, the term "Committee" shall be deemed to mean the recommendation of the Committee, as approved by the Board, for all purposes herein; and provided further that the Board may, in its discretion, at any time and from time to time, resolve to administer the Plan, in which case the term "Committee" shall be deemed to mean the Board for all purposes herein.  The Committee shall have the power and authority to prescribe, amend and rescind rules and procedures governing the administration of this Plan, including, but not limited to the full power and authority (a) to interpret the terms of this Plan, the terms of any Awards made under this Plan, and the rules and procedures established by the Committee governing any such Awards, (b) to determine the rights of any person under this Plan, or the meaning of requirements imposed by the terms of this Plan or any rule or procedure established by the Committee, (c) to select Participants for Awards under the Plan, (d) to determine the number of Ordinary Shares to be covered by each Award granted under this Plan, (e) to determine the amount of cash to be covered by each Award granted under his Plan, (f) to determine whether, to what extent and under what circumstances grants of Options and other Awards under the Plan are to operate on a tandem basis and/or in conjunction with or apart from other awards made by the Company outside of this Plan; (g) to determine whether and under what circumstances an Option may be settled in cash, Ordinary Shares and/or Restricted Securities under Section 4.6(a), (h) to determine whether an Option is an Incentive Stock Option or Non‐Qualified Stock Option, (i) to establish performance and vesting standards, (j) to impose such limitations, restrictions and conditions upon such Awards as it shall deem appropriate, (k) to modify, extend or renew an Award, provided, however, that such action does not subject the Award to Section 409A of the Code without the consent of the Participant, and does not disqualify an awarded intended to be performance‐based under Section 162(m) from being performance‐based, (l) to adopt, amend and rescind administrative guidelines and other rules and regulations relating to the Plan, (m) to correct any defect or omission or reconcile any inconsistency in the Plan, and (n) to make all other determinations and take all other actions necessary or advisable for the implementation and administration of the Plan, subject to such limitations as may be imposed by the Code or other applicable law and except as specifically provided by this Plan.  Each action of the Board shall be binding on all persons.  The Board may, to the extent permissible by law, delegate any of its authority hereunder to such persons as it deems appropriate, so long as such delegation does not result in awards intended to be performance‐based from being disqualified as such under Section 162(m).  The expenses of the Plan shall be borne by the Company. The Company shall not be required to establish any special or separate fund or make any other segregation of assets to assume the obligations pursuant to any Award made under the Plan, and rights to any payment in connection with such Awards shall be no greater than the rights of the Company's general creditors.

ARTICLE II
DEFINITIONS
As used in this Plan, unless otherwise specified in an Award Agreement, the following terms shall have the meanings set forth below:
"Affiliate" of a Person means any other Person, entity or investment fund controlling, controlled by, or under common control with such Person and, in the case of a Person which is a partnership, any partner of such Person.
"Award Agreement" means a notice from the Company to a Participant, or a written agreement between the Company and a Participant, in either case setting forth the terms, conditions, and limitations applicable to an Award, as amended from time to time.  All Award Agreements shall be deemed to include all of the terms and conditions of the Plan, except to the extent otherwise approved by the Board and set forth in an Award Agreement.
"Award Securities" means, with respect to a Participant, any Restricted Securities issued to such Participant hereunder, any Ordinary Shares issued to such Participant upon exercise of any Options granted hereunder, and any Ordinary Shares issued to such Participant in connection with any other Award made under the Plan.  For all purposes of this Plan, Award Securities will continue to be Award Securities in the hands of any holder other than a Participant (except for the Company and purchasers pursuant to a Public Sale), and each such other holder of Award Securities will succeed to all rights and obligations attributable to such Participant as a holder of Award Securities hereunder.  Award Securities will also include Ordinary Shares issued with respect to Award Securities by way of a security split, security dividend or other recapitalization.
"Cause" means, for any Participant, the meaning given to such term in an employment or other similar agreement entered into by such Participant and the Company or any of its Affiliates on or after the Effective Date and approved by the Board (which meaning shall continue to apply whether or not such agreement ceases to be effective, unless and until Participant subsequently enters into a superseding employment or other similar agreement that contains a definition of "Cause", in which case the meaning in such superseding agreement shall apply), or, in the absence of any such agreement, it shall mean (i) the commission of, or indictment for, a felony or a crime involving moral turpitude or the commission of any other act or any omission to act involving dishonesty, disloyalty or fraud with respect to the Company or any of its Subsidiaries or any of their customers or suppliers, (ii) failure to perform duties as reasonably directed by the Board or such Participant's supervisor(s), if any, (iii) gross negligence or willful misconduct with respect to the Company or any of its Subsidiaries, (iv) Detrimental Activity, or (v) any other material breach of the terms of this Plan, an Award Agreement or any other agreement with the Company or any of its Subsidiaries to which such Participant is a party.
"Change in Control" means (i) any transaction or series of transactions in which any Person (whether by merger, sale of securities, recapitalization, or reorganization) becomes the "beneficial owner" (as defined in Rule 13d‐3 under the Exchange Act or any successor thereto), directly or indirectly, of securities of the Company representing more than 50% of the total voting power in the Company, provided that the acquisition of additional securities by any Person that owns more than 50% of the voting power prior to such acquisition of additional securities shall not be a Change in Control, (ii) during any twelve‐month period, individuals who at the beginning of such period constitute the Board and any new directors whose election by the Board or nomination for election by the Company's stockholders was approved by at least a majority of the directors then still in office who either were directors at the beginning of the period or whose election was previously so approved, cease for any reason to constitute a majority thereof, (iii) the stockholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in all or a portion of the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, and (iv) a sale or disposition of all or substantially all of the assets of the Company and its Subsidiaries on a consolidated basis; provided, that in any instance where an Award is treated as deferred compensation within the meaning of Section 409A of the Code, "Change in Control" shall mean a "change in control" as defined in Section 409A(a)(2)(v) of the Code and the guidance issued thereunder.
"Code" means the Internal Revenue Code of 1986, as it may be amended from time to time.
"Committee" means the Compensation Committee of the Board.
"Detrimental Activity" means any breach of any confidentiality, non‐compete, non‐solicitation or similar agreement with the Company or any of its Subsidiaries (in each case including any such provision included in an Award Agreement or other agreement), or any arrangement dealing with ownership or protection of the Company's and its Subsidiaries' proprietary rights.

"Disability" means, with respect to any Participant, the meaning given to such term in an employment or other similar agreement entered into by such Participant and the Company or any of its Affiliates on or after the Effective Date and approved by the Board (which meaning shall continue to apply whether or not such agreement ceases to be effective, unless and until Participant subsequently enters into a superseding employment or other similar agreement that contains a definition of "Disability", in which case the meaning in such superseding agreement shall apply), or, in the absence of any such agreement, it shall mean such Participant's incapacity due to physical or mental illness, which incapacity makes Participant eligible to receive disability benefits under the Company's or its Subsidiaries' long‐term disability plans or any equivalent thereof; provided, that in any instance where an Award is treated as "deferred compensation" within the meaning of Section 409A of the Code, "Disability" shall be interpreted consistently with the meaning of Section 409A(a)(2)(C) of the Code and guidance issued thereunder.
"Dutch Financial Supervision Act" means the Dutch Act on the Financial Supervision (Wet op het financieel toezicht), including the rules and regulations promulgated thereunder.
"Fair Market Value" of an Ordinary Share of the Company means, as of the date in question, the officially‐quoted closing selling price of the Ordinary Shares (or if no selling price is quoted, the bid price) on the principal securities exchange or market on which the Ordinary Shares are then listed for trading (including, for this purpose, the New York Stock Exchange or the Nasdaq National Market) (the "Market") for the applicable trading day or, if the Ordinary Shares are not then listed or quoted in the Market, the Fair Market Value shall be the fair value of the Ordinary Shares determined in good faith by the Board using any reasonable method; provided, however, that when shares received upon exercise of an Option are immediately sold in the open market, the net sale price received may be used to determine the Fair Market Value of any shares used to pay the exercise price or applicable withholding taxes and to compute the withholding taxes.
"Incentive Stock Option" means an option conforming to the requirements of Section 422 of the Code and/or any successor thereto.
"Initial Public Offering" means the initial public offering and sale of Ordinary Shares pursuant to an effective registration statement under the Securities Act.
"Non‐Qualified Stock Option" means any Option awarded under the Plan that is not an Incentive Stock Option.
"Ordinary Shares" means the Company's Ordinary Shares, par value €0.01 per share, or in the event that the outstanding shares of ordinary share capital are hereafter recapitalized, converted into or exchanged for different stock or securities of the Company, such other stock or securities.
"Performance Goals" means goals established by the Committee as contingencies for Awards to vest and/or become exercisable or distributable based on one or more of the performance goals set forth in Exhibit A hereto.
"Performance Period" means the designated period during which the Performance Goals must be satisfied with respect to the Award to which the Performance Goals relate.
"Person" means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a government or any branch, department, agency, political subdivision or official thereof.
"Public Sale" means any sale pursuant to a registered public offering under the Dutch Financial Supervision Act, the Securities Act, or any similar securities law applicable outside of the Netherlands or the United States, or any sale to the public through a broker, dealer or market maker pursuant to Rule 144 promulgated under the Securities Act or any similar exemption under the Dutch Financial Supervision Act or other securities law applicable outside of the United States.
"Securities Act" means the Securities Act of 1933, as amended from time to time.
"Subsidiary" means any corporation, partnership, limited liability company, or other entity in which the Company owns, directly or indirectly, stock or other equity securities or interests possessing 50% or more of the total combined voting power of such entity.
"Termination Date" means the date on which a Participant is no longer employed by the Company or any of its Subsidiaries for any reason.  For the avoidance of doubt, a Participant's Termination Date shall be considered to be the last date of his actual and active employment with the Company or one of its Subsidiaries, whether such day is selected by agreement with the Participant or unilaterally by the Company or such Subsidiary and whether advance notice is or is not given to the Participant; no period of 

notice that is or ought to have been given under applicable law in respect of the termination of employment will be taken into account in determining entitlement under the Plan.
"Transfer" means any direct or indirect sale, transfer, assignment, pledge, encumbrance or other disposition (whether with or without consideration and whether voluntary or involuntary or by operation of law, including to the Company or any of its Subsidiaries) of any interest.
ARTICLE III

AWARDS AND ELIGIBILITY

3.1    Awards.  Awards under the Plan ("Awards") may be granted in any of the following forms: (i) options to purchase Ordinary Shares pursuant to the Plan ("Options"), (ii) rights pursuant to an Award granted under Article V herein ("Stock Appreciation Rights"), (iii) Ordinary Shares pursuant to the Plan and subject to certain restrictions under Article VI herein ("Restricted Securities"), (iv) Awards granted to a Participant pursuant to the Plan contingent upon achieving certain Performance Goals ("Performance Awards"), (v) Awards granted pursuant to the Plan which are valued in whole or in part by reference to, or are payable in or otherwise based on, Ordinary Shares, including, without limitation, an Award valued by reference to an Affiliate ("Other Stock‐Based Awards"), (vi) other cash‐based Awards pursuant to the Plan which are payable in cash at such time or times and subject to the terms and conditions as determined by the Committee in its sole discretion ("Other Cash‐Based Awards") and (vii) any combination thereof.  Unless the Committee determines otherwise, each grant of any Awards shall be evidenced by a written Award Agreement containing such restrictions, terms and conditions, if any, as the Committee may require; provided that if there is any conflict between any provision of the Plan and any provision approved by the Committee and expressly set forth in an Award Agreement, such express provisions of the Award Agreement shall govern.
3.2    Maximum Securities Available. 
(a)    Subject to adjustments as provided in Section 3.2(c), an aggregate of 10,000,000 Ordinary Shares may be issued pursuant to the Plan. Such Ordinary Shares may be in whole or in part authorized and unissued or held by the Company as treasury shares. If any Award under the Plan expires or terminates unexercised, becomes unexercisable or is forfeited as to any Ordinary Shares, then such unpurchased, forfeited, tendered or withheld Ordinary Shares may thereafter be available for further Awards under the Plan as the Committee shall determine.  Without limiting the generality of the foregoing provisions of this Section 3.2(a) or any other section of this Plan, the Committee may, at any time or from time to time, and on such terms and conditions (that are consistent with and not in contravention of the other provisions of this Plan) as the Committee may, in its sole discretion, determine, enter into agreements (or take other actions with respect to the Awards) for new Awards containing terms (including exercise prices) more (or less) favorable than the outstanding Awards.  The maximum number of Incentive Stock Options that may be issued pursuant to the Plan shall be 10,000,000.
(b)    Individual Participant Limitations.  To the extent required by Section 162(m) of the Code for Awards under the Plan intended to qualify as "performance‐based compensation," (i) the Committee shall not grant to any one Participant, in any one calendar year, Options or Stock Appreciation Rights or Restricted Securities, or Other Stock‐Based Awards for which the grant of such Award is subject to the attainment of Performance Goals, to purchase a number of Ordinary Shares in excess of 50% of the total number of Ordinary Shares authorized under the Plan pursuant to Section 3.2(a), and (ii) the maximum value of a cash payment made under an Other Cash‐Based Award to any one Participant in any one calendar year shall not exceed $5,000,000, in each case, unless otherwise provided for in an Award Agreement.
(c)    Adjustments.  
(i)    In the event of a reorganization, recapitalization, stock split, stock dividend, combination of shares, merger, consolidation, distribution of assets, or any other change in the corporate structure or shares of the Company, the Committee shall make such adjustment as it deems appropriate, in its sole discretion, in the number and kind of Ordinary Shares or other property available for issuance under the Plan (including, without limitation, the total number of Ordinary Shares available for issuance under the Plan pursuant to Section 3.2(a)), in the number and kind of Options, Stock Appreciation Rights, Restricted Securities, Ordinary Shares or other property covered by Awards previously made under the Plan, and in the exercise price of outstanding Options and Stock Appreciation Rights.  Any such adjustment shall be final, conclusive and binding for all purposes of the Plan.  In the event of any merger, consolidation or other reorganization in which the Company is not the surviving or continuing corporation or in which a Change in Control is to occur, all of the Company's obligations regarding Awards that were granted hereunder and that are outstanding on the date of such event shall, on such terms as may be approved by the Committee prior to such event, be assumed by the surviving or continuing corporation or canceled in exchange for property (including cash).

(ii)    Without limitation of the foregoing, in connection with any transaction of the type specified by clause (iii) of the definition of a Change in Control in Article II, the Committee may, in its discretion, (i) cancel any or all outstanding Options under the Plan in consideration for payment to the holders thereof of an amount equal to the portion of the consideration that would have been payable to such holders pursuant to such transaction if their Options had been fully exercised immediately prior to such transaction, less the aggregate exercise price that would have been payable therefor, or (ii) if the amount that would have been payable to the Option holders pursuant to such transaction if their Options had been fully exercised immediately prior thereto would be equal to or less than the aggregate exercise price that would have been payable therefor, cancel any or all such Options for no consideration or payment of any kind.  Payment of any amount payable pursuant to the preceding sentence may be made in cash or, in the event that the consideration to be received in such transaction includes securities or other property, in cash and/or securities or other property in the Committee's discretion.
3.3    Eligibility.  
(a)    General Eligibility.  The Committee may, from time to time, select the Participants who shall be eligible to participate in the Plan and the Awards to be made to each such Participant.  The Committee may consider any factors it deems relevant in selecting Participants and in making Awards to such Participants.  The Committee's determinations under the Plan (including, without limitation, determinations of which Persons are to receive Awards and in what amount) need not be uniform and may be made by it selectively among Persons who are eligible to receive Awards under the Plan.
(b)    Incentive Stock Options.  Notwithstanding the foregoing, only employees of the Company and its Subsidiaries (as defined for this purpose in Section 424(f) of the Code or any successor thereto) are eligible to be granted Incentive Stock Options under the Plan.  Eligibility for the grant of an Incentive Stock Option and actual participation in the Plan shall be determined by the Committee in its sole discretion.
(c)    Securities Laws.  In connection with the grant of any Awards under the Plan or any issuance of any Award Securities, the Company will comply with applicable securities laws, including, to the extent applicable, the Securities Act and the Dutch Financial Supervision Act, and the rules and regulations promulgated thereunder.  In furtherance of the foregoing, the Committee may, in its sole discretion, establish certain conditions for the grant of any Awards under the Plan including, without limitation, the time schedule upon which Awards may be granted, and the Committee will take into account any such established conditions, to the extent applicable, when granting or making any other determinations with respect to Awards under the Plan.
3.4    No Right to Continued Employment; No Entitlement to Future Awards.  Nothing in this Plan or (in the absence of an express provision to the contrary) in any Award Agreement, as applicable, shall confer on any Participant any right to continue in the employment of the Company or its Subsidiaries or interfere in any way with the right of the Company or its Subsidiaries to terminate such Participant's employment at any time for any reason or to continue such Participant's present (or any other) rate of compensation.  The grant of an Award to any Participant shall not create any rights in such Participant to any subsequent Awards by the Company, no Award hereunder shall be considered a condition of such Participant's employment, and no profit with respect to an Award shall be considered part of such Participant's salary or compensation under any severance statute or other applicable law.
3.5    Exchange of Prior Awards.  In connection with any new Award, the Committee shall have the right, at its discretion, to condition a Participant's receipt of such new Award on the requirement that such Participant return to the Company Awards previously granted to him or her under the Plan.  Subject to the provisions of the Plan, such new Award shall be upon such terms and conditions as are specified by the Committee at the time the new Award is made.
ARTICLE IV
OPTIONS
4.1    Options.  The Committee shall have the right and power to grant to any Participant, at any time prior to the termination of this Plan, Options in such quantity, at such price, on such terms and subject to such conditions that are consistent with this Plan and established by the Committee.  The Committee may choose to grant, in its sole discretion, Incentive Stock Options and/or Non‐Qualified Stock Options.  All Options granted under this Plan shall be in the form described in this Article IV, or in such other form or forms as the Committee may determine, and shall be subject to such additional terms and conditions and evidenced by Award Agreements, as shall be determined from time to time by the Committee.  Except as otherwise set forth in an Award Agreement, Options shall be subject to all of the terms and conditions contained in this Plan.

4.2    Incentive Stock Options.  It is the Company's intent that Non‐Qualified Stock Options granted under the Plan not be classified as Incentive Stock Options, that Incentive Stock Options be consistent with and contain or be deemed to contain all provisions required under Section 422 of the Code and any successor thereto, and that any ambiguities in construction be interpreted in order to effectuate such intent.  If an Incentive Stock Option granted under the Plan does not qualify as such for any reason, then to the extent of such non‐qualification, the Option represented thereby shall be regarded as a Non‐qualified Stock Option duly granted under the Plan, provided that such Option otherwise meets the Plan's requirements for Non‐qualified Stock Options
4.3    Vesting of Options.  
(a)    The Committee shall determine the terms and conditions upon which each Option becomes exercisable which may but need not include, without limitation, time vesting and/or performance vesting.  Options shall be exercisable by a Participant only to the extent that they are vested.  Except as provided for in Section 4.3(b), Options shall vest only so long as a Participant remains employed by the Company or one of its Subsidiaries.
(b)    Vesting on Change in Control.  Unless otherwise specified in an Award Agreement, in the event of a Change in Control, if a Participant is terminated without Cause within 24 months thereafter, all of such Participant's Options shall be considered 100% vested.
4.4    Normal Expiration.  The term during which each Option may be exercised shall be determined by the Committee, but if required by the Code and except as otherwise provided herein, no Option shall be exercisable in whole or in part more than ten years from the date it is granted, and no Incentive Stock Option granted to a Participant who at the time of the grant owns more than 10% of the total combined voting power of all classes of stock of the Company or any of its Subsidiaries shall be exercisable more than five years from the date it is granted.  All rights to purchase Ordinary Shares pursuant to an Option shall, unless sooner terminated, expire at the date designated by the Committee.
4.5    Expiration on Termination.  Unless the Committee determines otherwise, if a Participant ceases to be employed by the Company and its Subsidiaries for any reason, then the portion of such Participant's Options that have not fully vested as of the Termination Date shall expire at such time.  Unless the Committee determines otherwise, the portion of a Participant's Options that are not subject to vesting or that have fully vested as of such Participant's Termination Date shall expire (i) 60 days after the Termination Date if such Participant ceases to be employed by the Company and its Subsidiaries for any reason other than termination with Cause or due to death or Disability, (ii) on the Termination Date if such Participant's employment is terminated with Cause, and (iii) in the event such Participant dies or suffers a Disability, on the date that is six months after the date on which such Participant's employment ceases due to such Participant's death or Disability.
4.6    Exercise.
(a)    Procedure for Exercise.  Unless otherwise specified in an Award Agreement, at any time after all or any portion of a Participant's Options have become vested and prior to their expiration, a Participant may exercise all or any specified portion of such vested Options by delivering written notice of exercise specifically identifying the particular Options to the third party service provider that has been appointed by the Company to administer the Awards (an "Exercise Notice"), together with (i) a written acknowledgment that such Participant has read and has been afforded an opportunity to ask questions of management of the Company regarding all financial and other information provided to such Participant regarding the Company and (ii) payment in full of the exercise price, in accordance with Section 4.6(b) or as otherwise determined by the Committee; provided that, for the avoidance of doubt, any participant who is also subject to Section 16 of the of the Securities Exchange Act of 1934, as amended (the "1934 Act") must further comply with the notice procedures of the Company's insider trading and disclosure policies as in effect from time to time.
(b)    Payment.  
(i)    Unless the Committee determines otherwise, payment shall be made (A) in cash (including check, bank draft, money order or wire transfer of immediately available funds), (B) by delivery of outstanding Ordinary Shares with a Fair Market Value on the date of exercise equal to the aggregate exercise price payable with respect to the Options' exercise, (C) to the extent permitted by applicable law, by simultaneous sale through a broker reasonably acceptable to the Committee of Ordinary Shares acquired on exercise, as permitted under Regulation T of the Federal Reserve Board, (D) by authorizing the Company to withhold from issuance a number of Ordinary Shares issuable upon exercise of the options which, when multiplied by the Fair Market Value of an Ordinary Share on the date of exercise, is equal to the aggregate exercise price payable with respect to the Options so exercised or (E) by any combination of the foregoing.

(ii)    In the event a Participant elects to pay the exercise price payable with respect to an Option pursuant to clause (B) of Section 4.6(b)(i) above, (A) only a whole number of Ordinary Share(s) (and not fractional Ordinary Shares) may be tendered in payment, (B) such Participant must present evidence acceptable to the Company that he or she has owned any such Ordinary Shares tendered in payment of the exercise price (and that such tendered Ordinary Shares have not been subject to any substantial risk of forfeiture) for at least six months prior to the date of exercise, and (C) Ordinary Shares must be delivered to the Company. Delivery for this purpose may, at the election of the Participant, be made either by (A) physical delivery of the certificate(s) for all such Ordinary Shares tendered in payment of the price, accompanied by duly executed instruments of transfer in a form acceptable to the Company, or (B) direction to the Participant's broker to transfer, by book entry, of such Ordinary Shares from a brokerage account of the Participant to a brokerage account specified by the Company. When payment of the exercise price is made by delivery of Ordinary Shares, the difference, if any, between the aggregate exercise price payable with respect to the Option being exercised and the Fair Market Value of the Ordinary Shares tendered in payment (plus any applicable taxes) shall be paid in cash. No Participant may tender Ordinary Shares having a Fair Market Value exceeding the aggregate exercise price payable with respect to the Option being exercised (plus any applicable taxes).
(iii)    In the event a Participant elects to pay the exercise price payable with respect to an Option pursuant to clause (D) of Section 4.6(b)(i) above, only a whole number of Ordinary Share(s) (and not fractional Shares) may be withheld in payment. When payment of the exercise price is made by withholding of Ordinary Shares, the difference, if any, between the aggregate exercise price payable with respect to the Option being exercised and the Fair Market Value of the Ordinary Shares withheld in payment (plus any applicable taxes) shall be paid in cash. No Participant may authorize the withholding of Ordinary Shares having a Fair Market Value exceeding the aggregate exercise price payable with respect to the Option being exercised (plus any applicable taxes). Any withheld Ordinary Shares shall no longer be issuable under such Option.
(c)    Exercise Price.  The exercise price of a Participant's Options shall be specified in such Participant's Award Agreement.  Such exercise price shall be denominated in U.S. Dollars and determined based upon the currency exchange rate between Euros and U.S. Dollars as published in the Wall Street Journal on the date of grant of such Options (or at such other time as specified in an Award Agreement).  The price per Ordinary Share deliverable upon the exercise of each Option ("exercise price") shall not be less than 100% of the Fair Market Value of an Ordinary Share as of the date of grant of the Option, and in the case of the grant of any Incentive Stock Option to a Participant who, at the time of the Grant, owns more than 10% of the total combined voting power of all classes of stock of the Company or any of its Subsidiaries, the exercise price may not be less than 110% of the Fair Market Value of a share of Common Stock as of the date of grant of the Option, in each case unless otherwise determined by the Committee and permitted by Section 422 of the Code or any successor thereto.
(d)    Limitation on Repricing. To the extent required by applicable law or by rules and regulations of any exchange on which the Ordinary Shares are listed or traded, unless such action is approved by the Company's stockholders: (1) no outstanding Option granted under the Plan may be amended to provide an exercise price per share that is lower than the then‐current exercise price per share of such outstanding Option (other than adjustments pursuant to Section 3.2(c)(i) and (2) the Committee may not cancel any outstanding Option (whether or not granted under the Plan) and grant in substitution therefor new Awards under the Plan covering the same or a different number of Ordinary Shares and having an exercise price per share lower than the then‐current exercise price per share of the cancelled Option.
4.7    Incentive Stock Option Limitations.  To the extent that the aggregate Fair Market Value (determined as of the time of grant) of Ordinary Shares with respect to which Incentive Stock Options are exercisable for the first time by an eligible Participant during any calendar year under this Plan and/or any other stock option plan of the Company, any Subsidiary or any Parent (as defined for this purpose in Section 424 of the Code or any successor thereto) exceeds $100,000, such Options shall be treated as Non‐Qualified Stock Options.  Should any provision of this Plan not be necessary in order for the Options to qualify as Incentive Stock Options, or should any additional provisions be required, the Committee may amend this Plan accordingly, without the necessity of obtaining the approval of the stockholders of the Company.
4.8    Deferred Delivery of Award Securities.  The Committee may in its discretion permit Participants to defer delivery of Award Securities acquired pursuant to a Participant's exercise of an Option in accordance with the terms and conditions established by the Committee in the applicable Award Agreement, which shall be intended to comply with the requirements of Section 409A of the Code.
4.9    Rights as a Securityholder.  Unless the Committee determines otherwise, a Participant holding Options shall have no rights as a securityholder with respect to any Award Securities issuable upon exercise thereof until the earlier of the date on which such Award Securities are identified on the share register(s) of the Company and the date on which a certificate is issued to such Participant representing such Award Securities.  Except as otherwise expressly provided in the Plan or in any Award Agreement, no adjustment in respect of any Award Securities shall be made for cash dividends or other rights for which the record date is prior to the earlier of the date on which such Award Securities are identified on the share register(s) of the Company and 

the date on which a certificate is issued to such Participant representing such Award Securities.
ARTICLE V
STOCK APPRECIATION RIGHTS
5.1    Stock Appreciation Rights.  The Committee shall have the right and power to grant to any Participant, at any time prior to the termination of this Plan, Stock Appreciation Rights, whether or not in tandem with Options, in such quantity, at such price, on such terms and subject to such conditions that are consistent with this Plan and established by the Committee.  Stock Appreciation Rights granted under this Plan shall be in the form described in this Article V, or in such other form or forms as the Committee may determine, and shall be subject to such additional terms and conditions and evidenced by Award Agreements, as shall be determined from time to time by the Committee.  Except as otherwise set forth in an Award Agreement, Stock Appreciation Rights shall be subject to all of the terms and conditions contained in this Plan.
5.2    Vesting of Stock Appreciation Rights.  
(a)    The Committee shall determine the terms and conditions upon which each Stock Appreciation Rights becomes exercisable which may but need not include, without limitation, time vesting and/or performance vesting. Stock Appreciation Rights shall be exercisable by a Participant only to the extent that they are vested.  Except as provided for in Section 5.2(b), Stock Appreciation Rights shall vest only so long as a Participant remains employed by the Company or one of its Subsidiaries.
(b)    Vesting on Change in Control.  Unless otherwise specified in an Award Agreement, in the event of a Change in Control, if a Participant is terminated without Cause within 24 months thereafter, all of such Participant's Stock Appreciation Rights shall be considered 100% vested.
5.3    Normal Expiration.    The term during which each Stock Appreciation Right may be exercised shall be determined by the Committee, but if required by the Code and except as otherwise provided herein, no Stock Appreciation Right shall be exercisable in whole or in part more than ten years from the date it is granted.  
5.4    Expiration on Termination.  Unless the Committee determines otherwise, if a Participant ceases to be employed by the Company and its Subsidiaries for any reason, then the portion of such Participant's Stock Appreciation Rights that have not fully vested as of the Termination Date shall expire at such time.  Unless the Committee determines otherwise, the portion of a Participant's Stock Appreciation Rights that are not subject to vesting or that have fully vested as of such Participant's Termination Date shall expire (i) 60 days after the Termination Date if such Participant ceases to be employed by the Company and its Subsidiaries for any reason other than termination with Cause or due to death or Disability, (ii) on the Termination Date if such Participant's employment is terminated with Cause, and (iii) in the event such Participant dies or suffers a Disability, on the date that is six months after the date on which such Participant's employment ceases due to such Participant's death or Disability.
5.5    Exercise; Payment.  Stock Appreciation Rights may be exercised in whole or in part at any time in accordance with the applicable Award Agreement.  Unless otherwise specified in an Award Agreement, Participant shall be entitled to receive, for each right exercised, up to, but no more than, an amount in cash and/or Ordinary Shares (as chosen by the Board in its sole discretion) equal in value to the excess of the Fair Market Value of one Ordinary Share on the date that the right is exercised over the Fair Market Value of one Ordinary Share on the date that the right was awarded to the Participant.
5.6    Limitation on Repricing. To the extent required by applicable law or by rules and regulations of any exchange on which the Ordinary Shares are listed or traded, unless such action is approved by the Company's stockholders: (1) no outstanding Stock Appreciation Right granted under the Plan may be amended to provide an exercise price per share that is lower than the then‐current exercise price per share of such outstanding Stock Appreciation Right (other than adjustments pursuant to Section 3.2(c)(i) and (2) the Committee may not cancel any outstanding Stock Appreciation Right (whether or not granted under the Plan) and grant in substitution therefor new Awards under the Plan covering the same or a different number of Ordinary Shares and having an exercise price per share lower than the then‐current exercise price per share of the cancelled Stock Appreciation Right.

5.7    Limited Stock Appreciation Rights.  The Committee may, in its sole discretion, grant Stock Appreciation Rights either as a general Stock Appreciation Right or as a Limited Stock Appreciation Right.  Limited Stock Appreciation Rights may be exercised only upon the occurrence of a Change in Control or such other event as the Committee may, in its sole discretion, designate at the time of grant or thereafter.  Upon the exercise of Limited Stock Appreciation Rights, except as otherwise provided in an Award Agreement, the Participant shall receive in cash and/or Ordinary Shares, as determined by the Committee, an amount equal to the amount set forth in Section 5.5.
5.8    Other Terms and Conditions.  The Committee may include a provision in an Award Agreement providing for the automatic exercise of a Stock Appreciation Right on a cashless basis on the last day of the term of such Stock Appreciation Right if the Participant has failed to exercise the Stock Appreciation Right as of such date, with respect to which the Fair Market Value of the Ordinary Shares underlying the Stock Appreciation Right exceed the exercise price of such Stock Appreciation Right on the date of expiration of such Stock Appreciation Right, subject to Section 12.4.  Stock Appreciation Rights may contain such other provisions, which shall not be inconsistent with any of the terms of the Plan, as the Committee shall deem appropriate.
ARTICLE VI
RESTRICTED SECURITIES
6.1    Restricted Securities.  The Committee shall have the right and power to grant to any Participant, at any time prior to the termination of this Plan, Restricted Securities in such quantity, at such price, on such terms and subject to such conditions that are consistent with this Plan and established by the Committee.  Restricted Securities granted under this Plan shall be in the form described in this Article VI, or in such other form or forms as the Committee may determine, and shall be subject to such additional terms and conditions and evidenced by Award Agreements, as shall be determined from time to time by the Committee.  Except as otherwise set forth in an Award Agreement, Restricted Securities shall be subject to all of the terms and conditions contained in this Plan.
6.2    Issuance of Restricted Securities.  The Committee shall have the right and power to issue Restricted Securities to any Participant, at such prices as may be established by the Committee in its discretion, which prices, in respect of Ordinary Shares, shall not be less than the nominal values of such Ordinary Shares.  The consideration for any such issue (if any) shall be cash, unless otherwise determined by the Committee.
6.3    Vesting of Restricted Securities.
(a)    The Committee shall determine the terms and conditions upon which each Restricted Security vests, which may but need not include, without limitation, time vesting and/or performance vesting; provided, however, that in no event shall any Restricted Security granted to an employee of the Company or any of its Subsidiaries vest in fewer than three years (in the case of a time‐vesting award), or one year (in the case of a performance‐vesting award).
(b)    Vesting on Change in Control.  Unless otherwise specified in an Award Agreement, in the event of a Change in Control, if a Participant is terminated without Cause within 24 months thereafter, all of such Participant's Restricted Securities shall be considered 100% vested.
6.4    Restricted Security Certificates.  If the Restricted Securities are to be certificated under the terms of the Company's organizational documents, unless otherwise specified in an Award Agreement, the Company shall issue, in the name of each Participant to whom Restricted Securities have been granted or sold, certificates representing the total number of Restricted Securities granted or sold to such Participant, as soon as reasonably practicable after such grant or sale.  The Company shall hold such certificates for the Participant's benefit, unless otherwise specified in an Award Agreement, until such Restricted Securities become freely transferable, at which time the Company shall deliver such certificates (free of all such transferability restrictions) to the Participant.
6.5    Expiration on Termination.  
(a)    Unless the Committee determines otherwise, if a Participant ceases to be employed by the Company and its Subsidiaries for any reason, then the portion of such Participant's Restricted Securities that are not subject to vesting or that have not fully vested as of the Termination Date shall be forfeited at such time.  The portion of a Participant's Restricted Securities that have fully vested as of such Participant's Termination Date shall be forfeited on the Termination Date only if such Participant's employment is terminated with Cause.

(b)    Reimbursement of Consideration.  In the instance that the Participant paid any consideration to the Company in connection with the issuance of any portion of the Participant's Restricted Securities and if any of such Restricted Securities are forfeited pursuant to Section 6.5(a), unless otherwise specified in an Award Agreement, the Company shall reimburse the Participant for the lesser of (i) the amount of consideration paid for the forfeited Restricted Securities and (ii) the Fair Market Value of the forfeited Restricted Securities on the Termination Date.
(c)    Rights of a Participant.  Unless the Committee determines otherwise, any Participant who holds Restricted Securities shall have the right to receive dividends and distributions, if any are declared, with respect to such Restricted Securities; provided, however, that any dividends or distributions in respect of unvested Restricted Securities will be withheld by the Company and will be delivered to the Participant only to the extent and at such time as such Restricted Securities become fully vested.  Any Securities received by a Participant as a result of any such dividends or distributions shall be considered Restricted Securities and shall be subject to all of the restrictions contained in the Plan (including Section 6.4).
ARTICLE VII
PERFORMANCE AWARDS
7.1    Performance Awards.  The Committee shall have the right and power to grant to any Participant, at any time prior to the termination of this Plan, Performance Awards.  The Committee may grant Performance Awards that are intended to qualify as "performance‐based compensation" under Section 162(m) of the Code, as well as Performance Awards that are not intended to qualify as "performance‐based compensation" under Section 162(m) of the Code.  If the Performance Award is payable in shares of Award Securities, such shares shall be transferable to the Participant only upon attainment of the relevant Performance Goal in accordance with Article VII.  If the Performance Award is payable in cash, it may be paid upon the attainment of the relevant Performance Goals either in cash or in shares of Award Securities (based on the then current Fair Market Value of such shares), as determined by the Committee, in its sole and absolute discretion.  Performance Awards granted under this Plan shall be in the form described in this Article VII, or in such other form or forms as the Committee may determine, and shall be subject to such additional terms and conditions and evidenced by Award Agreements, as shall be determined from time to time by the Committee.  With respect to Performance Awards that are intended to qualify as "performance‐based compensation" under Section 162(m) of the Code, the Committee shall condition the right to payment of any Performance Award upon the attainment of objective Performance Goals established pursuant to Section 7.2(c).
7.2    Terms and Conditions.  Performance Awards awarded pursuant to this Article VII shall be subject to the following terms and conditions:
(a)    Earning of Performance Award.  At the expiration of the applicable Performance Period, the Committee shall determine the extent to which the Performance Goals established pursuant to Section 7.2(c) are achieved and the percentage of each Performance Award that has been earned.
(b)    Non‐Transferability.  Subject to the applicable provisions of the Award Agreement and the Plan, Performance Awards may not be Transferred during the Performance Period.
(c)    Objective Performance Goals, Formulae or Standards.  With respect to Performance Awards that are intended to qualify as "performance‐based compensation" under Section 162(m) of the Code, the Committee shall establish the objective Performance Goals for the earning of Performance Awards based on a Performance Period applicable to each Participant or class of Participants in writing prior to the beginning of the applicable Performance Period or at such later date as permitted under Section 162(m) of the Code and while the outcome of the Performance Goals are substantially uncertain.  Such Performance Goals may incorporate, if and only to the extent permitted under Section 162(m) of the Code, provisions for disregarding (or adjusting for) changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions) and other similar type events or circumstances.  To the extent that any such provision would create impermissible discretion under Section 162(m) of the Code or otherwise violate Section 162(m) of the Code, such provision shall be of no force or effect, with respect to Performance Awards that are intended to qualify as "performance‐based compensation" under Section 162(m) of the Code.
(d)    Dividends.  Unless the Committee determines otherwise at the time of the Award, amounts equal to dividends declared during the Performance Period with respect to the number of Ordinary Shares covered by a Performance Award will not be paid to the Participant.

(e)    Payment.  Following the Committee's determination in accordance with Section 7.2(a), the Company shall settle Performance Awards, in such form (including, without limitation, in Award Securities or in cash) as determined by the Committee, in an amount equal to such Participant's earned Performance Awards.  Notwithstanding the foregoing, the Committee may, in its sole discretion, award an amount less than the earned Performance Awards and/or subject the payment of all or part of any Performance Award to additional vesting, forfeiture and deferral conditions as it deems appropriate.
(f)    Termination.  Unless otherwise specified in an Award Agreement, if a Participant ceases to be employed by the Company and its Subsidiaries for any reason, then any unvested Performance Award will be forfeited.
(g)    Vesting.  Vesting of any Performance Award shall be determined by the Committee.  Based on service, performance and/or such other factors or criteria, if any, as the Committee may determine, the Committee may, at or after grant, accelerate the vesting of all or any part of any Performance Award.
ARTICLE VIII
OTHER STOCK‐BASED AND CASH‐BASED AWARDS
8.1    Other Stock‐Based Awards.
(a)    The Committee shall have the right and power to grant to any Participant, at any time prior to the termination of this Plan, Other Stock Based Awards that are payable in, valued in whole or in part by reference to, or otherwise based on or related to Ordinary Shares, including but not limited to, Award Securities awarded purely as a bonus and not subject to restrictions or conditions, Award Securities in payment of the amounts due under an incentive or performance plan sponsored or maintained by the Company or an Affiliate, stock equivalent units, restricted stock units, and Awards valued by reference to book value of Ordinary Shares.  Other Stock‐Based Awards may be granted either alone or in addition to or in tandem with other Awards granted under the Plan.
(b)    Subject to the provisions of the Plan, the Committee shall have authority to determine the Participants, to whom, and the time or times at which, such Awards shall be made, the number of Award Securities to be awarded pursuant to such Awards, and all other conditions of the Awards.  The Committee may also provide for the grant of Award Securities under such Awards upon the completion of a specified Performance Period.
(c)    The Committee may condition the grant or vesting of Other Stock‐Based Awards upon the attainment of specified Performance Goals as the Committee may determine, in its sole discretion; provided that to the extent that such Other Stock‐Based Awards are intended to comply with Section 162(m) of the Code, the Committee shall establish the objective Performance Goals for the grant or vesting of such Other Stock‐Based Awards based on a Performance Period applicable to each Participant or class of Participants in writing prior to the beginning of the applicable Performance Period or at such later date as permitted under Section 162(m) of the Code and while the outcome of the Performance Goals are substantially uncertain.  Such Performance Goals may incorporate, if and only to the extent permitted under Section 162(m) of the Code, provisions for disregarding (or adjusting for) changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions) and other similar type events or circumstances.  To the extent that any such provision would create impermissible discretion under Section 162(m) of the Code or otherwise violate Section 162(m) of the Code, such provision shall be of no force or effect, with respect to Performance Awards that are intended to qualify as "performance‐based compensation" under Section 162(m) of the Code.
8.2    Terms and Conditions.  Other Stock‐Based Awards made pursuant to this Article VIII shall be subject to the following terms and conditions:
(a)    Non‐Transferability.  Subject to the applicable provisions of the Award Agreement and the Plan, Award Securities subject to Awards made under this Article VIII may not be Transferred prior to the date on which the shares are issued, or, if later, the date on which any applicable restriction, performance or deferral period lapses.
(b)    Dividends.  Unless otherwise determined by the Committee at the time of Award, subject to the provisions of the Award Agreement and the Plan, the recipient of an Award under this Article VIII shall not be entitled to receive, currently or on a deferred basis, dividends or dividend equivalents with respect to the number of Ordinary Shares covered by the Award, as determined at the time of the Award by the Committee, in its sole discretion.

(c)    Vesting.  Any Award under this Article VIII and any Award Securities covered by any such Award shall vest or be forfeited to the extent so provided in the Award Agreement, as determined by the Committee, in its sole discretion.
(d)    Price.  Award Securities issued on a bonus basis under this Article VIII may be issued for no cash consideration.  Award Securities purchased pursuant to a purchase right awarded under this Article VIII shall be priced, as determined by the Committee in its sole discretion.
8.3    Other Cash‐Based Awards.  The Committee may from time to time grant Other Cash‐Based Awards to Participants in such amounts, on such terms and conditions, and for such consideration, including no consideration or such minimum consideration as may be required by applicable law, as it shall determine in its sole discretion.  Other Cash‐Based Awards may be granted subject to the satisfaction of vesting conditions or may be awarded purely as a bonus and not subject to restrictions or conditions, and if subject to vesting conditions, the Committee may accelerate the vesting of such Awards at any time in its sole discretion.  The grant of an Other Cash‐Based Award shall not require a segregation of any of the Company's assets for satisfaction of the Company's payment obligation thereunder.
ARTICLE IX

LISTING, REGISTRATION AND QUALIFICATION

9.1    Compliance with Laws.  Each Award shall be subject to the requirement that if at any time the Committee shall determine, in its discretion, that the listing, registration or qualification of the securities subject to such Award upon any securities exchange or under any state or federal securities or other law or regulation or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to or in connection with the granting of such Award or the issue or purchase of securities thereunder, no such Award may be exercised or paid in Ordinary Shares in whole or in part unless such listing, registration, qualification, consent or approval (a "Required Listing") shall have been effected or obtained and the holder of the Award will supply the Company with such certificates, representations and information as the Company shall request which are reasonably necessary or desirable in order for the Company to obtain such Required Listing, and shall otherwise cooperate with the Company in obtaining such Required Listing.  In the case of officers and other Persons subject to Section 16(b) of the 1934 Act, or any similar securities law applicable outside of the United States, the Committee may at any time impose any limitations upon the exercise of an Award which, in the Committee's discretion, are necessary or desirable in order to comply with Section 16(b) of the 1934 Act and the rules and regulations thereunder and any similar securities law applicable outside of the United States.
ARTICLE X
TRANSFERABILITY
10.1    Unless the Committee determines otherwise, no Award granted under the Plan shall be transferable by a Participant other than by will or the laws of descent and distribution; provided that, in the case of Restricted Securities granted under the Plan, such Restricted Securities shall be freely transferable following the time at which such restrictions shall have lapsed with respect to such Restricted Securities. Any attempted Transfer of an Award which is not specifically permitted under the Plan shall be null and void.  Unless the Committee determines otherwise, an Award may be exercised only by the Participant to which it was granted; by his or her executor or administrator, the executor or administrator of the estate of any of the foregoing, or any Person to whom the Award is transferred by will or the laws of descent and distribution; or by his or her guardian or legal representative; or the guardian or legal representative of any of the foregoing; provided that Incentive Stock Options may be exercised by any guardian or legal representative only if permitted by the Code and any regulations thereunder. All provisions of this Plan and any applicable Award Agreement shall in any event continue to apply to any Award granted under the Plan (or any Award Securities received in respect of an Award) and transferred as permitted by this Article X, and any transferee of any such Award (or Award Securities) shall be bound by all provisions of this Plan and any applicable Award Agreement as and to the same extent as the applicable original grantee.
ARTICLE XI
DETRIMENTAL ACTIVITY
11.1    Unless the Committee determines otherwise, (i) in the event that a Participant engages in Detrimental Activity prior to any exercise, distribution or settlement of any Award, such Award shall thereupon terminate and expire, (ii) in the event that a Participant resigns at a time after engaging in Detrimental Activity, such resignation shall nonetheless be treated as a termination with Cause for all purposes hereunder, (iii) as a condition of the exercise, distribution or settlement of any Award, the Committee may, at its sole discretion, require the Participant to certify at the time of exercise, in a manner acceptable to the 

Company, that the Participant is in compliance with the terms and conditions of the Plan and that the Participant has not engaged in any Detrimental Activity, and (iv) in the event that the Participant engages in Detrimental Activity during the one‐year period commencing on the date of exercise, distribution or settlement of an Award, whether or not such Person continues to be employed by the Company, the Company shall be entitled to recover from such Participant at any time within one year after such exercise, settlement, or distribution, and the Participant shall pay over to the Company, an amount equal to any gain realized as a result of the exercise, distribution or settlement (whether at the time of exercise, distribution or settlement or thereafter).  The foregoing provisions described in this Article XI shall terminate upon a Change in Control.
ARTICLE XII
OTHER PROVISIONS
12.1    Indemnification.  No member of the Board, including members of the Committee, nor any Person to whom ministerial duties have been delegated, shall be Personally liable for any action, interpretation or determination made with respect to the Plan or Awards made thereunder, and each member of the Board shall be fully indemnified and protected by the Company with respect to any liability he or she may incur with respect to any such action, interpretation or determination, to the extent permitted by applicable law and to the extent provided in the Company's Articles of Association, as amended from time to time, or under any agreement between any such member and the Company.
12.2    Termination and Amendment.
(a)    Amendment and Termination of the Plan.  Except as otherwise provided in an Award Agreement, the Board, without approval of the stockholders, may amend, modify or terminate the Plan, except that no amendment shall become effective without prior approval of the stockholders of the Company if stockholder approval would be required by applicable law or regulations, including if required for continued compliance with the performance‐based compensation exception of Section 162(m) of the Code or any successor thereto, under the provisions of Section 409A of the Code or any successor thereto, under the provisions of Section 422 of the Code or any successor thereto, or by any listing requirement of the principal stock exchange on which the Ordinary Shares are then listed.
(b)    Amendment or Substitution of Grants under the Plan.  The terms of any outstanding Award under the Plan may be amended from time to time by the Committee in its discretion in any manner that it deems appropriate including, but not limited to, acceleration of the date of exercise of any Award and/or payments thereunder or of the date of lapse of restrictions on Award Securities (but, in the case of an Award that is or would be treated as "deferred compensation" for purposes of Section 409A of the Code, only to the extent permitted by guidance issued under Section 409A of the Code without resulting in the excise tax thereunder); provided that, except as otherwise provided in Section 12.2 or in an Award Agreement, no such amendment shall adversely affect in a material manner any right of a Participant under the Award without his or her written consent, and further provided that the Committee shall not reduce the exercise price of any Options or Stock Appreciation Rights awarded under the Plan without stockholder approval. The Committee may, in its discretion, permit holders of Awards under the Plan to surrender outstanding Awards in order to exercise or realize rights under other Awards, or in exchange for new Awards, or require holders of Awards to surrender outstanding Awards as a condition precedent to the receipt of new Awards under the Plan, but only if such surrender, exercise, realization, exchange or Award (a) is not treated as a payment of, and does not cause a Award to be treated as, deferred compensation for the purposes of Section 409A of the Code or (b) is permitted under guidance issued pursuant to Section 409A of the Code without resulting in the excise tax thereunder.
12.3    Taxes.
(a)    The Company shall have the right to require Participants or their beneficiaries or legal representatives to remit to the Company an amount sufficient to satisfy his or her minimum federal, state, local and foreign withholding tax requirements, or to deduct from all payments under the Plan amounts sufficient to satisfy such minimum withholding tax requirements.  Whenever payments under the Plan are to be made to a Participant in cash, such payments shall be net of any amounts sufficient to satisfy all federal, state, local and foreign withholding tax requirements.
(b)    The Committee may, in its discretion permit a Participant to satisfy his or her tax withholding obligation either by (i) surrendering Award Securities owned by the Participant or (ii) having the Company withhold from Award Securities otherwise deliverable to such Participant.  Award Securities surrendered or withheld shall be valued at Fair Market Value as of the date on which income is required to be recognized for income tax purposes.  Once a Participant surrenders or has withheld Award Securities hereunder, such action shall be irrevocable.  Any deliver of Award Securities under this Section 12.3 shall be subject to the conditions and pursuant to the procedures of Section 4.6(b).

12.4    Withholding.  In a situation where, if a Participant were to receive Restricted Securities or other Award Securities through exercise of an Option or other Award, the Company or any of its Affiliates (or a former Affiliate) would be obliged to (or would suffer a disadvantage if it were not to) account for any tax or social security contributions in any jurisdiction for which that Person would be liable by virtue of the receipt of Award Securities or which would be recoverable from that Person (together, the "Tax Liability"), the Restricted Securities may not be issued nor the Options or other Awards exercised unless that Person has either (i) made a payment to the Company or any of its Affiliates (or a former Affiliate) of an amount at least equal to the Company's estimate of the Tax Liability, or (ii) entered into arrangements acceptable to the Company or any of its Affiliates (or a former Affiliate) to secure that such a payment is made (whether by authorizing the sale of some or all of the Restricted Securities and/or other Award Securities, as applicable, on his or her behalf and the payment to the Company or any of its Affiliates (or a former Affiliate) of the relevant amount out of the proceeds of sale or otherwise).
12.5    Section 409A of the Code.  
(a)    The Plan is intended to comply with the applicable requirements of Section 409A of the Code and shall be limited, construed and interpreted in accordance with such intent.  To the extent that any Award is subject to Section 409A of the Code, it shall be paid in a manner that will comply with Section 409A of the Code, including proposed, temporary or final regulations or any other guidance issued by the Secretary of the Treasury and the Internal Revenue Service with respect thereto.  Notwithstanding anything herein to the contrary, any provision in the Plan that is inconsistent with Section 409A of the Code shall be deemed to be amended to comply with Section 409A of the Code and to the extent such provision cannot be amended to comply therewith, such provision shall be null and void.  The Company shall have no liability to a Participant, or any other party, if an Award that is intended to be exempt from, or compliant with, Section 409A of the Code is not so exempt or compliant or for any action taken by the Board or the Company and, in the event that any amount or benefit under the Plan becomes subject to penalties under Section 409A of the Code, responsibility for payment of such penalties shall rest solely with the affected Participants and not with the Company. In no event shall the Company, the Board, or any of their respective Affiliates be liable to any Participant or any other Person for any cost, expense, tax, liability or other detriment imposed on a Participant or any other Person under Section 409A of the Code related to such Participant's acceptance of any Award or participation in the transactions contemplated by the Plan.  Notwithstanding any contrary provision in the Plan or Award Agreement, any payment(s) of "nonqualified deferred compensation" (within the meaning of Section 409A of the Code) that are otherwise required to be made under the Plan to a "specified employee" (as defined under Section 409A of the Code) as a result of his or her separation from service (other than a payment that is not subject to Section 409A of the Code) shall be delayed for the first six (6) months following such separation from service (or, if earlier, the date of death of the specified employee) and shall instead be paid (in a manner set forth in the Award Agreement) on the payment date that immediately follows the end of such six month period or as soon as administratively practicable thereafter.
(b)    Except as otherwise provided in an Award Agreement, notwithstanding any of the foregoing provisions of the Plan, and in addition to the powers of amendment set forth in Sections 12.1 and 12.2 hereof, the provisions hereof and the provisions of any Award made hereunder may be amended unilaterally by the Company from time to time to the extent necessary (and only to the extent necessary) to prevent the implementation, application or existence (as the case may be) of any such provision from (i) requiring the inclusion of any compensation deferred pursuant to the provisions of the Plan (or an award thereunder) in a Participant's gross income pursuant to Section 409A of the Code, and the regulations issued thereunder from time to time and/or (ii) inadvertently causing any award hereunder to be treated as providing for the deferral of compensation pursuant to such Code section and regulations.
12.6    Section 162(m) Transition.  The Plan was adopted by the Board and approved by the Company's stockholders, both of which occurred prior to the Initial Public Offering. The Plan is intended to constitute a plan described in Treasury Regulation Section 1.162−27(f)(1), pursuant to which the deduction limits under Section 162(m) of the Code do not apply during the applicable reliance period. The reliance period shall end on the earliest to occur of the following: (i) the date of the first meeting of stockholders of the Company at which directors are to be elected that occurs after the close of the third calendar year following the calendar year in which the Initial Public Offering occurs; (ii) the date the Plan is materially amended for purposes of Treasury Regulation Section 1.162−27(h)(1)(iii); or (iii) the date all Ordinary Shares available for issuance have been allocated.
12.7    Participant Compliance.  
(a)    In connection with the subscription to or exercise of any Award, and/or the transfer of any Award Security, Participant shall comply with (i) all applicable securities laws, including, to the extent applicable, the Securities Act, the 1934 Act and the Dutch Financial Supervision Act, and the rules and regulations promulgated thereunder and (ii)  to the extent applicable to such Participant, the insider trading and disclosure policies or procedures of the Company as in effect from time to time, including, without limitation, policies regarding compliance with Section 16 of the 1934 Act and Section 5:65 of the Dutch Financial Supervision Act.

(b)    In connection with the subscription to or exercise of any Award, Participant shall execute such documents necessary for the Company to perfect exemptions from registration under any applicable federal and state securities laws in the United States and elsewhere as the Company may reasonably request.
12.8    Data Protection.  By participating in the Plan or accepting any rights granted under it, each Participant consents to the collection and processing of Personal data relating to the Participant so that the Company and its Affiliates can fulfill their obligations and exercise their rights under the Plan and generally administer and manage the Plan.  This data will include, but may not be limited to, data about participation in the Plan and securities offered or received, purchased or sold under the Plan from time to time and other appropriate financial and other data (such as the date on which the Options were granted) about the Participant and his participation in the Plan.
12.9    Notices.  Notices required or permitted to be made under the Plan shall be in writing and shall be deemed given, delivered and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile prior to 5:00 p.m. (New York time) on a business day, (ii) the business day after the date of transmission, if such notice or communication is delivered via facsimile later than 5:00 p.m. (New York time) on any business day and earlier than 11:59 p.m. (New York time) on the day preceding the next business day, (iii) one (1) business day after when sent, if sent by nationally recognized overnight courier service (charges prepaid), and (iv) actual receipt by the Person to whom such notice is required to be given.  All notices shall be addressed (a) to a Participant at such Participant's address as set forth in the books and records of the Company and its Subsidiaries, or (b) to the Company or the Committee at the principal office of the Company clearly marked "Attention:  Compensation Committee".
12.10    Severability.  Whenever possible, each provision of this Plan shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Plan is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this Plan shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
12.11    Prior Agreements.  No provision of any employment, severance, incentive award, or other similar agreement entered into by a Participant, on the one hand, and any Subsidiary of the Company, on the other hand, prior to the Effective Date shall modify or have any effect in any manner on any provision of this Plan or any term or condition of any Award Agreement to which such Participant is a party.  Without limiting the generality of the foregoing, any provision in any such agreement that purports to apply in any manner to options, security, equity‐based awards or the like shall not apply to or have any effect on any Awards under the Plan.
12.12    Governing Law and Forum; Waiver of Jury Trial.  The Plan shall be construed and interpreted in accordance with the laws of the State of New York, United States.  Each Participant who accepts an Award thereby agrees that any suit, action or proceeding brought by or against such Participant in connection with this Plan shall be brought solely in the state and federal courts sitting in the State of New York, County of New York, United States, and each Participant consents to the jurisdiction and venue of each such court.  EACH PARTICIPANT WHO ACCEPTS AN AWARD IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY SUIT, ACTION OR OTHER PROCEEDING INSTITUTED BY OR AGAINST SUCH PARTICIPANT IN RESPECT OF HIS OR HER RIGHTS OR OBLIGATIONS HEREUNDER.

*     *     *     *     *

EXHIBIT A
 
PERFORMANCE GOALS

To the extent permitted under Section 162(m) of the Code, performance goals established for purposes of Awards intended to be "performance‐based compensation" under Section 162(m) of the Code, shall be based on the attainment of certain target levels of, or a specified increase or decrease (as applicable) in one or more of the following performance goals:

		
	•
	earnings per share;

		
	•
	operating income;

		
	•
	gross income;

		
	•
	net income (before or after taxes);

		
	•
	cash flow;

		
	•
	gross profit;

		
	•
	gross profit return on investment;

		
	•
	gross margin return on investment;

		
	•
	gross margin;

		
	•
	operating margin;

		
	•
	working capital;

		
	•
	earnings before interest and taxes;

		
	•
	earnings before interest, tax, depreciation and amortization;

		
	•
	return on equity;

		
	•
	return on assets;

		
	•
	return on capital;

		
	•
	return on invested capital;

		
	•
	net revenues;

		
	•
	gross revenues;

		
	•
	revenue growth;

		
	•
	annual recurring revenues;

		
	•
	recurring revenues;

		
	•
	license revenues;

		
	•
	sales or market share;

		
	•
	total shareholder return;

		
	•
	economic value added;

		
	•
	specified objectives with regard to limiting the level of increase in all or a portion of the Company's bank debt or other long‐term or short‐term public or private debt or other similar financial obligations of the Company, which may be calculated net of cash balances and/or other offsets and adjustments as may be established by the Committee in its sole discretion;

		
	•
	the fair market value of the a share of Common Stock;

		
	•
	the growth in the value of an investment in the Common Stock assuming the reinvestment of dividends; or

		
	•
	reduction in operating expenses.

With respect to Awards that are intended to qualify as "performance‐based compensation" under Section 162(m) of the Code, to the extent permitted under Section 162(m) of the Code, the Committee may, in its sole discretion, also exclude, or adjust to reflect, the impact of an event or occurrence that the Committee determines should be appropriately excluded or adjusted, including:
(a)    restructurings, discontinued operations, extraordinary items or events, and other unusual or non‐recurring charges as described in Accounting Principles Board Opinion No. 30 and/or management's discussion and analysis of financial condition and results of operations appearing or incorporated by reference in the Company's Form 10‐K for the applicable year;
(b)    an event either not directly related to the operations of the Company or not within the reasonable control of the Company's management; or
(c)    a change in tax law or accounting standards required by generally accepted accounting principles.
Performance goals may also be based upon individual Participant performance goals, as determined by the Committee, in its sole discretion.  In addition, Awards that are not intended to qualify as "performance‐based compensation" under Section 

162(m) of the Code may be based on the performance goals set forth herein or on such other performance goals as determined by the Committee in its sole discretion.
In addition, such performance goals may be based upon the attainment of specified levels of Company (or subsidiary, division, other operational unit, administrative department or product category of the Company) performance under one or more of the measures described above relative to the performance of other corporations.  With respect to Awards that are intended to qualify as "performance‐based compensation" under Section 162(m) of the Code, to the extent permitted under Section 162(m) of the Code, but only to the extent permitted under Section 162(m) of the Code (including, without limitation, compliance with any requirements for stockholder approval), the Committee may also designate additional business criteria on which the performance goals may be based.

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