California Stock Repurchase Agreement

„Resolved: that the company`s policy regarding the exercise of buyback options on the company`s shares is explained as follows: … [4] With respect to the complainant`s assertion that the share repurchase option at the bank is a so-called liability contract, we first note that the term means a standardized contract that, imposed and developed by the party with greater bargaining power, gives the notifying party only the ability to respect or refuse the contract. This type of contract is condemned by the courts because it is not the result of freedom or equal bargaining (Neal v. State Farm Ins. cos. (1961) 188 Cal. Ca. 2d 690, 694 [10 Cal.Rptr. 781]). However, in deciding whether an individual contract can be considered a liability contract, the litmus test is whether the strongest party has disappointed the reasonable expectations of the other party (Hays v. Pacific Indem. Group (1970) 8 Cal. App.3d 158, 163, 165 [86 Cal.

Rptr. 815]; Kessler, Contracts of Adhesion — Some Thoughts About Freedom of Contract (1943) 43 Colum.L.Rev. 629, 637). [5 bis] In light of this test, it seems clear that Arthur voluntarily participated in the company`s stock options plan, which was of great use to him, and that his widow, when the shares were repurchased, was granted the improved book value, the negotiated consideration. In particular, it should be noted that at the time of the contract, the company`s shares were not in public trading or were to be sold to the public. As a result, the parties were not and were not able to consider the possibility of public trade with the higher prices that resulted from it at the time of the contract. „Determined: that the Executive Committee recognize that in the event of an IPO of the stock, it would be unfair for the company to retain the opportunity to acquire shares of the company at a price below the market price of those shares. 2.4.

The buy-back option is exercised by the company, if so, by written notification to the founder or, in the event of the founder`s death, the founder`s executors and, by (i) delivery to the founder`s founder`s founder`s founder or executor, a cheque payment equal to the purchase price, (ii) by cancellation of the debt at the purchase price or (iii) by a combination of (i) and (ii) price. To the extent that one or more certificates constituting unpublished shares may have been previously delivered in trust to the founder, the founder will deliver to the Secretary of the Company, before the closing date of the transaction, the certificates constituting the unreleased shares to be repurchased, each certificate must be properly received.