Document:

Exhibit

Exhibit 10.3
CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

FIFTH AMENDMENT TO DISTRIBUTION AGREEMENT

This Fifth Amendment to the Distribution Agreement ("Fifth Amendment") is between Vericel Corporation ("Vericel") and Orsini Pharmaceutical Services, Inc. (“Orsini"). This Fifth Amendment is entered into as of August 10, 2018 ("Effective Date").

Whereas, Vericel and Orsini are parties to a Distribution Agreement dated May 15, 2017 (as amended, the "Agreement"), under which Vericel appointed Orsini as a specialty pharmacy distributor for Carticel® and MACI®;

Whereas, the Parties entered into the First Amendment to the Agreement effective August 10, 2017;

Whereas, the Parties entered into the Second Amendment to the Agreement effective October 13, 2017;

Whereas, the Parties entered into the Third Amendment to the Agreement effective November 14, 2017; 

Whereas, the Parties entered into the Fourth Amendment to the Agreement effective July 25, 2018; and 

Whereas, the Parties desire to modify certain terms of the Agreement, including the revision and restatement of Exhibit A; 

Now therefore, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree to amend the Agreement as follows:

		
	1.
	Exhibit A.   The Parties agree that Section 4(A) of Exhibit A to the Agreement – Payment Terms and Pricing shall be modified to state the following:

The Payment Terms outlined in the Fourth Amendment shall apply to all surgeries after [***], 2018.  Other cases are subject to the terms of the Third Amendment to the Distribution Agreement.

		
	2.
	Exhibit B.  The Parties agree that Exhibit B to the Agreement – Exclusive Payors shall be deleted and replaced with the attached revised Exhibit B.

		
	3.
	Exhibit C.  The Parties agree that Exhibit C to the Agreement – Existing Eligible Cases shall be deleted. 

		
	4.
	No Other Changes. To the extent terms in the Fifth Amendment conflict with the Agreement and/or any of the amendments to the Agreement, the terms of this Fifth Amendment shall prevail. Except as provided in this Fifth Amendment, the terms and conditions of the Agreement will continue in full force.

		
	5.
	Counterparts/Signatures. This Fifth Amendment may be executed in multiple counterparts, each of which constitutes an original, and all of which, collectively, constitute only one agreement. The signatures of the parties need not appear on the same counterpart, and delivery of an executed counterpart signature page by facsimile or other form of electronic transmission shall 

1

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

be as effective as executing and delivering this Fifth Amendment in the presence of the other parties to this Fifth Amendment.

IN WITNESS WHEREOF, the parties executed this Fifth Amendment as of its Effective Date.

	
		
	Vericel Corporation

By:  /s/Daniel Orlando 
Name:  Daniel Orlando
Title:    Chief Operating Officer

Date:  10 August 2018
	Orsini Pharmaceutical Services, Inc.

By:  /s/Carla Sawa
Name:  Carla Sawa
Title:     Chief Financial Officer

Date:  10 August 2018

2

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

EXHIBIT B – EXCLUSIVE PAYORS

Consistent with Section 1.1 and Section 7.1 of the Agreement, the Exclusive Payors listed on this Exhibit shall only apply to covered [***] lives.  For the sake of clarity, if one of the Payors on this Exhibit B has a plan covering [***] lives, Vericel is not required to process such claims via Orsini.  

[***]

3EX-10.01

 Exhibit 10.01 

CHANGE OF CONTROL 

SEVERANCE AGREEMENT 
 CHANGE OF CONTROL
SEVERANCE AGREEMENT, dated as of October 31, 2018 (this “Agreement”), by and between Valero Energy Corporation, a Delaware corporation (the “Company”), and Jason W. Fraser (the
“Executive”). 
 WHEREAS, the Board of Directors of the Company (the “Board”), has determined that it is
in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined herein). The
Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive’s full attention and
dedication to the current Company in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control that are generally competitive with those of other
corporations. Therefore, in order to accomplish these objectives, the Board has caused the Company to enter into this Agreement. 
 NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS: 
 Section 1.    Certain Definitions and
References. 
 (a)    “Effective Date” means the first date during the Change of Control Period
(as defined herein) on which a Change of Control occurs. Notwithstanding anything in this Agreement to the contrary, if a Change of Control occurs and if the Executive’s employment with the Company is terminated within six months prior to the
date on which the Change of Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment (1) was at the request of a third party that has taken steps reasonably calculated to effect a Change of
Control or (2) otherwise arose in connection with or anticipation of a Change of Control (a “Pre-Change of Control Termination”), then “Effective Date” means the date
immediately prior to the date of such termination of employment. 
 (b)    “Change of Control Period”
means the period commencing on the date hereof and ending on the third anniversary of the date hereof; provided, however, that, commencing on the date one year after the date hereof, and on each annual anniversary of such date (such date and
each annual anniversary thereof, the “Renewal Date”), unless previously terminated, the Change of Control Period shall be automatically extended so as to terminate three years from such Renewal Date, unless, at least 60 days prior to the
Renewal Date, the Company shall give notice to the Executive that the Change of Control Period shall not be so extended. 

(c)    “Affiliated Company” means any company controlled by, controlling or under common control with the
Company. 
 (d)    “Change of Control” means: 

(1)    The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of either (A) the then-outstanding shares 

 
of common stock of the Company (the “Outstanding Company Common Stock”) or (B) the combined voting power of the then-outstanding voting securities of the Company entitled to
vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that, for purposes of this Section 1(d)(1), the following acquisitions of Outstanding Company Common Stock or
of Outstanding Company Voting Securities shall not constitute a Change of Control: (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any Affiliated Company or (iv) any acquisition by any corporation pursuant to a transaction that complies with Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C); 

(2)    Individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s
stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person
other than the Board; 
 (3)    Consummation of a reorganization, merger, statutory share exchange or
consolidation or similar corporate transaction involving the Company or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of the Company (each, a “Business Combination”), in each case
unless, following such Business Combination, (A) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to
such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets
either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as
the case may be, (B) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of, respectively, the then-outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such corporation,
except to the extent that such ownership existed prior to the Business Combination, and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent
Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or 

(4)    Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

 (e)    “Accounting Firm” is defined in Section 8(b). 

  
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 (f)    “Accrued Obligations” is defined in
Section 5(a)(1)(A). 
 (g)    “Annual Base Salary” is defined in Section 3(b)(1). 

(h)    “Annual Bonus” is defined in Section 3(b)(2). 

(i)    “Bonus Target Amount” is defined in Section 3(b)(2). 

(j)    “Cause” is defined in Section 4(b). 

(k)    “Company” is defined in the Preamble and in Section 10(c). 

(l)    “Date of Termination” is defined in Section 4(e). 

(m)    “Disability” is defined in Section 4(a). 

(n)    “Employment Period” is defined in Section 2. 

(o)    “Good Reason” is defined in Section 4(c). 

(p)    “Notice of Termination” is defined in Section 4(d). 

(q)    “Other Benefits” is defined in Section 5(a)(4). 

(r)    “Performance Awards” is defined in Section 3(b)(9). 

(s)    “Pre-Change of Control Termination” is defined in
Section 1(a). 
 (t)    “Trigger Date” is defined in Section 3(b)(9). 

Section 2.    Employment Period. The Company hereby agrees to continue the
Executive in its employ, subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the third anniversary of the Effective Date (the “Employment Period”). The Employment
Period shall terminate upon the Executive’s termination of employment for any reason. 

Section 3.    Terms of Employment. 

(a) Position and Duties. 

(1)    During the Employment Period, (A) the Executive’s position (including status, offices,
titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned at any time during the
120-day period immediately preceding the Effective Date and (B) the Executive’s services shall be performed at the office where the Executive was employed immediately preceding the Effective Date or
at any other location less than 35 miles from such office. 
 (2)    During the Employment Period, and
excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote reasonable attention and 

  
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time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the
Executive’s reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period, it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable
boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the
Executive’s responsibilities as an employee of the Company in accordance with this Agreement. It is expressly understood and agreed that, to the extent that any such activities have been conducted by the Executive prior to the Effective Date,
the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive’s responsibilities to
the Company. 
 (b)    Compensation. 

(1)    Base Salary. During the Employment Period, the Executive shall receive an annual base
salary (the “Annual Base Salary”) at an annual rate at least equal to 12 times the highest monthly base salary paid or payable, including any base salary that has been earned but deferred, to the Executive by the Company and the
Affiliated Companies in respect of the 12-month period immediately preceding the month in which the Effective Date occurs. The Annual Base Salary shall be paid at such intervals as the Company pays executive
salaries generally. During the Employment Period, the Annual Base Salary shall be reviewed at least annually, beginning no more than 12 months after the last salary increase awarded to the Executive prior to the Effective Date. Any increase in the
Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. The Annual Base Salary shall not be reduced after any such increase and the term “Annual Base Salary” shall refer to the
Annual Base Salary as so increased. 
 (2)    Annual Bonus. In addition to the Annual Base
Salary, for each fiscal year ending during the Employment Period, the Executive shall be entitled to participate in an annual bonus (the “Annual Bonus”) that offers substantially comparable target bonus opportunities as existed
in the most recent full bonus year prior to the year in which the Change in Control occurs. For this purpose, a bonus opportunity shall be deemed to be substantially comparable if the targeted bonus amount (expressed as a percent of the
Executive’s Annual Base Salary for the year, and based on achievement of reasonably attainable goals) is at least equal to the Executive’s target bonus (expressed as a percent of the Executive’s Annual Base Salary for the relevant
year) that was established in the most recent full bonus year prior to the year in which the Change in Control occurs (the latter being hereafter referred to as the “Bonus Target Amount”) Each such Annual Bonus shall be paid no
later than the end of the third month of the fiscal year next following the fiscal year for which the Annual Bonus is awarded, unless the Executive shall elect to defer the receipt of such Annual Bonus. 

(3)    Incentive, Savings and Retirement Plans. During the Employment Period, the Executive
shall be entitled to participate in all incentive, savings and retirement plans, practices, policies, and programs applicable generally to other peer executives of the Company and the Affiliated Companies, but in no event shall such plans,
practices, policies and programs provide the Executive with incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), savings opportunities and
retirement benefit opportunities, in each case, materially less favorable, in the aggregate, than the most favorable of those provided by the Company and the Affiliated 

  
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Companies for the Executive under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and the Affiliated Companies. 

(4)    Welfare Benefit Plans. During the Employment Period, the Executive and/or the
Executive’s family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company and the Affiliated Companies (including, without
limitation, medical, prescription, dental, vision, disability, employee life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to other peer executives of the Company and the
Affiliated Companies, but in no event shall such plans, practices, policies and programs provide the Executive with benefits that are materially less favorable, in the aggregate, than the most favorable of such plans, practices, policies and
programs in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the
Effective Date to other peer executives of the Company and the Affiliated Companies. 

(5)    Expenses. During the Employment Period, the Executive shall be entitled to receive
prompt reimbursement for all reasonable expenses incurred by the Executive in accordance with the most favorable policies, practices and procedures of the Company and the Affiliated Companies in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated
Companies. 
 (6)    Fringe Benefits. During the Employment Period, the Executive shall be
entitled to fringe benefits, including, without limitation, tax and financial planning services, payment of club dues, and, if applicable, use of an automobile and payment of related expenses, in accordance with the most favorable plans, practices,
programs and policies of the Company and the Affiliated Companies in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the
Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies that are, in the aggregate, generally commensurate with those provided to similarly situated executives within
the Company following the Change of Control. 
 (7)    [reserved] 

(8)    Vacation. During the Employment Period, the Executive shall be entitled to paid
vacation in accordance with the most favorable plans, policies, programs and practices of the Company and the Affiliated Companies as in effect for the Executive during the 120-day period immediately preceding
the Effective Date. 
 (9)    Vesting of Outstanding Equity Incentive Awards. 

(A)    Time-Based Equity Incentive Awards. Notwithstanding any provision in the
Company’s stock incentive plans or the award agreements thereunder, immediately upon the Executive’s termination of employment for any reason other than (i) for Cause or (ii) voluntary termination by the Executive other than for
Good Reason or retirement, (1) all stock options (incentive or non-qualified) outstanding as of the Date of Termination, which are not then exercisable and vested, shall become fully

  
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exercisable and vested to the full extent of the original grant and all outstanding stock options (whether they are vested as of the Date of Termination or become vested as a result of this
provision) shall remain exercisable for the remainder of the original option term; and (2) all restrictions and deferral limitations applicable to any time-based restricted stock and restricted stock unit awards outstanding as of the Date of
Termination shall lapse, and such restricted stock and restricted stock unit awards shall become free of all restrictions and become fully vested and transferable to the full extent of the original grant. 

(B)    Performance Shares, Performance Units, and Other Long-Term Performance-Based Awards
(“Performance Awards”). Notwithstanding any provisions in the Company’s stock incentive plan or the award agreements thereunder, if the Executive’s employment is terminated by death, Disability or for Good Reason, or is
involuntarily terminated without Cause (the effective date of termination in connection with these types of termination events is referred to hereafter as a “Trigger Date”), then each then-outstanding performance period with respect
to any Performance Awards that have not vested or been forfeited as of the Trigger Date shall be terminated effective as of such Trigger Date; the degree of achievement of all performance conditions shall be determined based on actual performance
prior to the Trigger Date in accordance with the governing award agreements (or, in the event not covered in an award agreement, by Valero’s Compensation Committee in its sole discretion); and a pro rata portion of the earned values under such
Performance Awards shall be distributed to the Executive as soon as administratively practicable (and in any case within 30 days) after the Trigger Date, or in the case of a Pre-Change of Control Termination,
as soon as administratively practicable (and in any case within 30 days) after the Change of Control. For this purpose, the proration shall be determined as a function of the number of full months worked from the date of grant to the Trigger Date,
in relation to the full number of months in the originally scheduled performance period covering the Performance Awards. 

In the event that dividend equivalents have been granted in connection with such Performance Awards, then the settlement of
such dividend equivalents shall be determined in a similar manner to the underlying Performance Awards (i.e., with the amount of the dividend equivalents being based on actual performance of the Performance Awards prior to the Trigger Date,
and the amount of such dividend equivalents to be paid based on a pro ration, as described above). 

Section 4.    Termination of Employment. 

(a)    Death or Disability. The Executive’s employment shall terminate automatically if the Executive
dies during the Employment Period. If the Company determines in good faith that the Executive has a Disability (as defined herein) that has occurred during the Employment Period (pursuant to the definition of Disability), it may give to the
Executive written notice in accordance with Section 12(b) of its intention to terminate the Executive’s employment. In such event, the Executive’s employment with the Company shall terminate effective on the 30th day after receipt of
such notice by the Executive (the “Disability Effective Date”), provided that, within the 30 days after such receipt, the Executive shall not have returned to full-time performance of the Executive’s duties.
“Disability” means the absence of the Executive from the Executive’s duties with the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness that is determined
to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive’s legal representative. 

  
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 (b)    Cause. The Company may terminate the
Executive’s employment during the Employment Period for Cause. “Cause” means: 

(1)    the willful and continued failure of the Executive to perform substantially the Executive’s
duties (as contemplated by Section 3(a)(1)(A)) with the Company or any Affiliated Company (other than any such failure resulting from incapacity due to physical or mental illness or following the Executive’s delivery of a Notice of
Termination for Good Reason), after a written demand for substantial performance is delivered to the Executive by the Board or the Chief Executive Officer of the Company that specifically identifies the manner in which the Board or the Chief
Executive Officer of the Company believes that the Executive has not substantially performed the Executive’s duties, or 

(2)    the willful engaging by the Executive in illegal conduct or gross misconduct that is materially and
demonstrably injurious to the Company. 
 For purposes of this Section 4(b), no act, or failure to act, on the part of the Executive
shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interests of the Company. Any act, or failure
to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions of the Chief Executive Officer of the Company or a senior officer of the Company or based upon the advice of counsel for the Company shall
be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have
been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is
provided to the Executive and the Executive is given an opportunity, together with counsel for the Executive, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of the conduct described in
Section 4(b)(1) or 4(b)(2), and specifying the particulars thereof in detail. 
 (c)    Good Reason.
The Executive’s employment may be terminated by the Executive for Good Reason or by the Executive voluntarily without Good Reason. “Good Reason” means: 

(1)    the assignment to the Executive of any duties inconsistent in any respect with the Executive’s
position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 3(a)(1)(A), or any other action by the Company that results in a diminution in such position, authority,
duties or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Executive; 

(2)    any failure by the Company to comply with any of the provisions of Section 3(b), other than an
isolated, insubstantial and inadvertent failure not occurring in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Executive; 

(3)    the Company’s requiring the Executive (i) to be based at any office or location other than
as provided in Section 3(a)(1)(B), (ii) to be based at a location other than the principal executive offices of the Company if the Executive was employed at such location immediately preceding the Effective Date, or (iii) to travel on
Company business to a substantially greater extent than required immediately prior to the Effective Date; 

  
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 (4)    any purported termination by the Company of the
Executive’s employment otherwise than as expressly permitted by this Agreement; or 
 (5)    any
failure by the Company to comply with and satisfy Section 10(c). 
 The Executive’s mental or physical incapacity following the
occurrence of an event described above in clauses (1) through (5) shall not affect the Executive’s ability to terminate employment for Good Reason. 

(d)    Notice of Termination. Any termination by the Company for Cause, or by the Executive for Good Reason,
shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 12(b). “Notice of Termination” means a written notice that (1) indicates the specific termination provision in this
Agreement relied upon, (2) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (3) if the
Date of Termination (as defined herein) is other than the date of receipt of such notice, specifies the Date of Termination (which Date of Termination shall be not more than 30 days after the giving of such notice). The failure by the Executive or
the Company to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the
Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s respective rights hereunder. 

(e)    Date of Termination. “Date of Termination” means (1) if the Executive’s
employment is terminated by the Company for Cause, or by the Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified in the Notice of Termination, as the case may be, (2) if the Executive’s
employment is terminated by the Company other than for Cause or Disability, the Date of Termination shall be the date on which the Company notifies the Executive of such termination, and (3) if the Executive’s employment is terminated by
reason of death or Disability, the Date of Termination shall be the Executive’s date of death or the Disability Effective Date, as the case may be. 

Section 5.    Obligations of the Company upon Termination. 

(a)    Good Reason; Other Than for Cause, Death or Disability. If, during the Employment Period, the Company
terminates the Executive’s employment other than for Cause, death or Disability or the Executive terminates employment for Good Reason: 

(1)    the Company shall pay to the Executive, in a lump sum in cash within 30 days after the Date of
Termination (or, in the case of a Pre-Change of Control Termination, within 30 days after the Change of Control), the aggregate of the following amounts: 

(A)    the sum of (i) the Executive’s Annual Base Salary through the Date of Termination,
(ii) the product of (x) the Bonus Target Amount and (y) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination and the denominator of which is 365, and (iii) any
accrued vacation pay, in each case, to the extent not theretofore paid (the sum of the amounts described in subclauses (i), (ii) and (iii), the “Accrued Obligations”); and 

(B)    the amount equal to the product of (i) two and (ii) the sum of (x) the
Executive’s Annual Base Salary and (y) the Bonus Target Amount; and 

  
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 (2)    for two years after the Executive’s Date of
Termination, or such longer period as may be provided by the terms of the appropriate plan, program, practice or policy, the Company shall continue benefits to the Executive and/or the Executive’s family at least equal to those that would have
been provided to them in accordance with the plans, programs, practices and policies described in Section 3(b)(4) if the Executive’s employment had not been terminated or, if more favorable to the Executive, as in effect generally at any
time thereafter with respect to other peer executives of the Company and the Affiliated Companies and their families, provided that, in the event the Company determines that such continued benefit coverage may not be provided under the terms
of the applicable plan, program, practice or policy, or under applicable law, then, for the remainder of the period described in this subsection, the Company shall, in lieu of such continued coverage, provide Executive with a monthly cash payment
equal to the difference between the full cost of such coverage (as determined by the Company for purposes of COBRA coverage) and the monthly employee contribution required for such coverage; and provided further, however, that, if the
Executive becomes reemployed with another employer and is eligible to receive such benefits under another employer provided plan, the medical and other welfare benefits described herein shall be secondary to those provided under such other plan
during such applicable period of eligibility, or, if the Company is paying Executive the monthly cash payment in lieu of such coverage as described above, such payments shall cease. For purposes of determining eligibility (but not the time of
commencement of benefits) of the Executive for retiree benefits pursuant to such plans, practices, programs and policies, the Executive shall be considered to have remained employed (for purposes of both age and service credit) until two years after
the Date of Termination and to have retired on the last day of such period; 
 (3)    during the 12-month period following the Date of Termination (or, in the case of a Pre-Change of Control Termination, the 12-month period
following the Change of Control), the Company shall, at its sole expense as incurred, provide the Executive with outplacement services the scope and provider of which shall be selected by the Executive in the Executive’s sole discretion,
provided that, the cost of such outplacement shall not exceed $25,000 (as adjusted for inflation based on the Consumer Price Index or another nationally recognized published inflation index); and 

(4)    to the extent not theretofore paid or provided, the Company shall timely pay or provide to the
Executive any other amounts or benefits required to be paid or provided or that the Executive is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and the Affiliated Companies (such other
amounts and benefits, the “Other Benefits”). 
 (b)    Death. If the Executive’s
employment is terminated by reason of the Executive’s death during the Employment Period, the Company shall provide the Executive’s estate or beneficiaries with the Accrued Obligations and the timely payment or delivery of the Other
Benefits, and shall have no other severance obligations under this Agreement. The Accrued Obligations shall be paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination (or, in
the case of a Pre-Change of Control Termination, and to the extent not previously provided to Executive following Executive’s death, within 30 days following the Change of Control). With respect to the
provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 5(b) shall include, without limitation, and the Executive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal
to the most favorable benefits provided by the Company and the Affiliated Companies to the estates and beneficiaries of peer executives of the Company and the Affiliated Companies under such plans, programs, practices and policies relating to death
benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive’s estate and/or the
Executive’s beneficiaries, as in effect on the date of the Executive’s death with respect to other peer executives of the Company and the Affiliated Companies and their beneficiaries. 

  
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 (c)    Disability. If the Executive’s employment is
terminated by reason of the Executive’s Disability during the Employment Period, the Company shall provide the Executive with the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance
obligations under this Agreement. The Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination (or, in the case of a Pre-Change of Control Termination,
and to the extent not previously provided to Executive following the Executive’s Disability, within 30 days following the Change of Control). With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized
in this Section 5(c) shall include, and the Executive shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company and the
Affiliated Companies to disabled executives and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any
time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive and/or the Executive’s family, as in effect at any time thereafter generally with respect to
other peer executives of the Company and the Affiliated Companies and their families. 
 (d)    Cause; Voluntary
Termination Other Than for Good Reason. 
 (1)    If the Executive’s employment is
terminated for Cause during the Employment Period, the Company shall provide to the Executive (A) the Executive’s Annual Base Salary through the Date of Termination, (B) any accrued vacation pay, and (C) the Other Benefits, in
each case, to the extent theretofore unpaid, and shall have no other severance obligations under this Agreement. 

(2)    If the Executive voluntarily terminates employment during the Employment Period, excluding a
termination for Good Reason, the Company shall provide to the Executive the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. In such case, all the
Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination. 

Section 6.    Non-exclusivity of Rights.
Nothing in this Agreement shall prevent or limit the Executive’s continuing or future participation in any plan, program, policy or practice provided by the Company or the Affiliated Companies and for which the Executive may qualify, nor,
subject to Section 12(f), shall anything herein limit or otherwise affect such rights as the Executive may have under any other contract or agreement with the Company or the Affiliated Companies. Amounts that are vested benefits or that the
Executive is otherwise entitled to receive under any plan, policy, practice or program of or any other contract or agreement with the Company or the Affiliated Companies at or subsequent to the Date of Termination shall be payable in accordance with
such plan, policy, practice or program or contract or agreement, except as explicitly modified by this Agreement. Notwithstanding the foregoing, if the Executive receives payments and benefits pursuant to Section 5(a) of this Agreement, the
Executive shall not be entitled to any severance pay or benefits under any severance plan, program or policy of the Company and the Affiliated Companies, unless otherwise specifically provided therein by a specific reference to this Agreement. 

  
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 Section 7.    Full Settlement.
The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense, or
other claim, right or action that the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement, and such amounts shall not be reduced whether or not the Executive obtains other employment. The Company agrees to pay as incurred, to the full extent permitted by law, all legal fees and expenses that the
Executive may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of
performance thereof (including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement), plus, in each case, interest on any delayed payment at the applicable federal rate provided for in
Section 7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended (the “Code”). 

Section 8.    Potential Limitation on Payments. 

(a)    Anything in this Agreement to the contrary notwithstanding, if it shall be determined that any payment or
distribution by the Company or its Affiliated Companies to or for the benefit of the Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any
additional payments required under this Section 8) (all such payments and benefits, including the payments and benefits under Section 5 hereof, being hereinafter referred to as the “Total Payments”) would be subject to the
excise tax imposed by Section 4999 of the Code or any interest or penalties are incurred by the Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, collectively the “Excise
Tax”), then, after taking into account any reduction in the Total Payments provided by reason of Section 280G of the Code in such other plan, arrangement or agreement, the payments under this Agreement shall be reduced in the order
specified below, to the extent necessary so that no portion of the Total Payments is subject to the Excise Tax but only if (i) the net amount of such Total Payments, as so reduced (and after subtracting the net amount of federal, state and
local income taxes on such reduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced Total Payments) is greater than or equal to (ii) the net amount of such
Total Payments without such reduction (but after subtracting the net amount of federal, state and local income taxes on such Total Payments and the amount of Excise Tax to which the Executive would be subject in respect of such unreduced Total
Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced Total Payments). The payments and benefits under this Plan shall be reduced in the following order: (A) reduction
of any cash severance payments otherwise payable to the Executive that are exempt from Section 409A of the Code; (B) reduction of any other cash payments or benefits otherwise payable to the Executive that are exempt from Section 409A
of the Code, but excluding any payments attributable to any acceleration of vesting or payments with respect to any equity award that are exempt from Section 409A of the Code; (C) reduction of any other payments or benefits otherwise
payable to the Executive on a pro-rata basis or such other manner that complies with Section 409A of the Code, but excluding any payments attributable to any acceleration of vesting and payments with
respect to any equity award that are exempt from Section 409A of the Code; and (D) reduction of any payments attributable to any acceleration of vesting or payments with respect to any equity award that are exempt from Section 409A of
the Code, in each case beginning with payments that would otherwise be made last in time. 
 (b)    Subject to the
provisions of Section 8(c) hereof, all determinations required to be made under this Section 8, including whether and when Total Payments should be reduced, the amount of such Total Payments, Excise Taxes and all other related
determinations, as well as all assumptions to be utilized in arriving at such determinations, shall be made by Ernst & Young, LLP, or such other 

  
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nationally recognized certified public accounting firm as may be designated by the Executive, subject to the Company’s approval which will not be unreasonably withheld (the
“Accounting Firm”). The Accounting Firm shall provide detailed supporting calculations both to the Company and the Executive within 15 business days of the receipt of notice from the Executive that there has been a Payment or such
earlier time as is requested by the Company. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change of Control, the Executive, subject to the Company’s approval which
will not be unreasonably withheld, may appoint another nationally recognized accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and
expenses of the Accounting Firm shall be borne solely by the Company. Any determination by the Accounting Firm shall be binding upon the Company and the Executive. 

(c)    For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax,
(i) no portion of the Total Payments the receipt or enjoyment of which the Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be
taken into account; (ii) no portion of the Total Payments shall be taken into account which, in the written opinion of the Accounting Firm, does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the
Code (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, no portion of such Total Payments shall be taken into account which, in the opinion of the Accounting Firm, constitutes reasonable compensation
for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the Base Amount (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation; and (iii) the value of any
non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by the Accounting Firm in accordance with the principles of Sections 280G(d)(3) and (4) of the Code.

 (d)    As a result of uncertainty in the application of Section 280G and Section 4999 of the Code at the
time of the initial calculation by the Accounting Firm hereunder, it is possible that the cash severance payment made by the Company will have been less than the Company should have paid pursuant to Section 5 hereof (the amount of any such
deficiency, the “Underpayment”), or more than the Company should have paid pursuant to Section 5 hereof (the amount of any such overage, the “Overpayment”). In the event of an Underpayment, the Company shall
pay the Executive the amount of such Underpayment (together with interest at 120% of the rate provided in Section 1274(b)(2)(B) of the Code) not later than five business days after the amount of such Underpayment is subsequently determined,
provided, however, such Underpayment shall not be paid later than the end of the calendar year following the calendar year in which the Executive remitted the related taxes. In the event of an Overpayment, the amount of such Overpayment shall
by paid to the Company by the Executive not later than five business days after the amount of such Overpayment is subsequently determined (together with interest at 120% of the rate provided in Section 1274(b)(2)(B) of the Code). 

Section 9.    Confidential Information. 

(a)    The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential
information, knowledge or data relating to the Company or the Affiliated Companies, and their respective businesses, which information, knowledge or data shall have been obtained by the Executive during the Executive’s employment by the Company
or the Affiliated Companies and which information, knowledge or data shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the
Executive’s employment with the Company, the Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone
other than the Company and those persons designated by the Company. In no event shall an asserted violation of the provisions of this Section 9 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under
this Agreement. 

  
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 (b)    Notwithstanding the foregoing, nothing in this Agreement shall be
construed to prohibit or impede the Executive from reporting possible violations of federal law or regulation to any governmental agency or entity, including but not limited to the U.S. Equal Opportunity Commission, the Department of Justice, the
Securities and Exchange Commission, Congress and any agency Inspector General, or making other disclosures that are protected under the whistleblower provisions of federal law or regulation. This Agreement does not limit the Executive’s ability
to communicate with any government agencies or entities or participate in any investigation or proceeding that may be conducted by any such government agency or entity, including providing documents or other information or disclosures, without the
prior authorization of or the need to provide any notice to the Company. In addition, this Agreement does not limit the Executive’s right to receive an award for information provided to any government agencies or entities. Further, the
Executive acknowledges that the Executive has been advised that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that (a) is made (i) in
confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made in a complaint or
other document filed in a lawsuit or other proceeding, if such filing is made under seal. An individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of
the individual and use the trade secret information in the court proceeding, if the individual (A) files any document containing the trade secret under seal; and (B) does not disclose the trade secret, except pursuant to court order. 

Section 10.    Successors. 

(a)    This Agreement is personal to the Executive, and, without the prior written consent of the Company, shall not be
assignable by the Executive other than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives. 

(b)    This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. Except
as provided in Section 10(c), without the prior written consent of the Executive, this Agreement shall not be assignable by the Company. 

(c)    The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise)
to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had
taken place. “Company” means the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law or otherwise. 

Section 11.    Code Section 409A. This Agreement is intended to comply, and
shall be administered consistently in all respects, with Code Section 409A of the Internal Revenue Code of 1986, as amended (“Code”), and the regulations and additional guidance promulgated thereunder, to the extent applicable. In
this connection, the Company shall have authority to take any action, or refrain from taking any action, with respect to this Agreement that is reasonably necessary to ensure compliance with Code Section 409A (provided that the Company shall
choose the action that best preserves the value of the payments and benefits provided to the Executive under this Agreement that is consistent with Code Section 409A), and the parties agree that this Agreement shall be interpreted in a manner
that is consistent with Code Section 409A. 

  
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 In furtherance, but not in limitation of the foregoing: 

(a)    in no event may Executive designate, directly or indirectly, the calendar year of any payment to be made hereunder;

 (b)    whenever a payment specifies a payment period with reference to a number of days, the actual date of payment
within the specified period shall be within the sole discretion of the Company; 
 (c)    neither the Company nor
Executive will have the right to accelerate or defer the delivery of any payments except to the extent specifically permitted or required by Code Section 409A; 

(d)    in the event that Executive is a “specified employee” within the meaning of Code Section 409A,
payments which constitute a “deferral of compensation” under Code Section 409A and which would otherwise become due during the first six months following Executive’s Date of Termination shall be delayed and all such delayed
payments shall be paid in full in the seventh month after the Executive’s termination of employment or, if earlier, upon the Executive’s death, provided that the above delay shall not apply to any payment that is excepted from coverage by
Code Section 409A, such as a payment covered by the short-term deferral exception described in Treasury Regulations Section 1.409A-1(b)(4); 

(e)    notwithstanding any other provision of this Agreement, a termination, resignation or retirement of Executive’s
employment hereunder, shall mean, and be interpreted consistent with, a “separation from service” within the meaning of Code Section 409A, and “Date of Termination,” for purposes of determining the date that any payment or
benefit is required to be provided hereunder, shall be deemed to mean the date of Executive’s separation from service within the meaning of Code Section 409A; and 

(f)    with respect to any reimbursement of fees and expenses, or similar payments or any
in-kind benefits, the following shall apply: (i) unless a specific time period during which such expense reimbursements and payments may be incurred is provided for herein, such time period shall be
deemed to be Executive’s lifetime; (ii) the amount of expenses eligible for reimbursement hereunder, or in-kind benefits to which Executive is entitled hereunder, in any particular year shall not
affect the expenses eligible for reimbursement or in-kind benefits in any other year; (iii) the right to reimbursement of expenses or in-kind benefits shall not be
subject to liquidation or exchange for any other benefit; and (iv) the reimbursement of an eligible expense or a payment shall be made on or before the last day of the calendar year following the calendar year in which the expense was incurred
or the payment was remitted, as the case may be. 

Section 12.    Miscellaneous. 

(a)    This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without
reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified other than by a written agreement executed by the
parties hereto or their respective successors and legal representatives. 

  
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 (b)    All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows: 
  

			
	 if to the Executive:
	    	At the most recent address on file in the Company’s records
		
	 if to the Company:
	    	Valero Energy Corporation
		    	One Valero Way
		    	San Antonio, Texas 78249
		    	Attention: Corporate Secretary

 or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and
communications shall be effective when actually received by the addressee. 
 (c)    The invalidity or unenforceability
of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. 

(d)    The Company may withhold from any amounts payable under this Agreement such United States federal, state or local or
foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation. 
 (e)    The
Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the
Executive to terminate employment for Good Reason pursuant to Sections 4(c)(1) through 4(c)(5), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement. 

(f)    The Executive and the Company acknowledge that, except as may otherwise be provided under any other written
agreement between the Executive and the Company, the employment of the Executive by the Company is “at will” and, subject to Section 1(a), prior to the Effective Date, the Executive’s employment may be terminated by either the
Executive or the Company at any time prior to the Effective Date, in which case the Executive shall have no further rights under this Agreement. 

(g)    From and after the Effective Date, except as specifically provided herein, this Agreement shall supersede any other
agreement between the parties with respect to the subject matter hereof. 

  
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 IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant
to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written. 

 

			
	
	/s/ Jason W. Fraser
	Jason W. Fraser
	
	VALERO ENERGY CORPORATION
		
	by:	 	/s/ Joseph W. Gorder
	name: Joseph W. Gorder
	title: President and Chief Executive Officer

  
 Page 16

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