May 17, 2021
Via Email
Mike Okada
2321 Webster Street
San Francisco, CA 94115
bicycle@gmail.com; mokada@immersion.com
Re: Terms of Transition and Separation
Dear Mike:
This letter confirms the agreement (this “Agreement”) between you and Immersion Corporation, a Delaware corporation (the “Company”), concerning the terms of your transition and separation from employment and offers you certain benefits to which you would not otherwise be entitled, conditioned upon your provision of a general release of claims and covenant not to sue now and upon the Separation Date (defined below) as provided herein. If you agree to the terms outlined herein, please sign and return this Agreement to me in the timeframe outlined below.
1.Separation from Employment: As you know, the Company has determined that it is in the Company’s best interest for you and the Company to part ways and for your employment with the Company to end. The Company has discussed with you the terms under which it is willing to continue your employment through the Transition Period, as described further below.
2.Continued Employment; Other Release Consideration: In exchange for your agreement to the general release and waiver of claims and covenant not to sue set forth below and your other promises herein, the Company agrees to continue your employment on the following terms:
a.Separation Date; Transition Period and Services: Your last day of employment with the Company will be May 21, 2021 (the “Separation Date”) subject to the at-will nature of your employment, as described in Paragraph 2(d), below. Between now and the Separation Date (the “Transition Period”), you agree to carry out the duties and responsibilities of your position as directed principally by Jared Smith, Interim Chief Executive Officer & Vice President, Worldwide Sales, to whom you will report, and to provide other transition services as may reasonably be requested by the Company, including transition of the responsibilities, duties, and knowledge relative to your position (the “Transition Services”). During the Transition Period, you will maintain a full-time schedule.
b.Compensation and Benefits: During the Transition Period, the Company will continue to pay you your current base salary and you will continue to be eligible to participate in benefits customarily afforded to other employees, including participation in the
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Company-sponsored health benefits plan and continued vesting of options, to the fullest extent allowed by the governing plans, agreements, or policies.
c.Separation Compensation: In exchange for your agreement to the general release and waiver of claims and covenant not to sue set forth in Exhibit A (the “Second Release”), to be signed no earlier than the Separation Date, and your other promises herein, the Company agrees as follows:
i.Severance: The Company agrees to pay you, within ten (10) business days following the effectiveness of the Second Release (as provided therein), a lump sum payment in the gross amount of $171,450, less applicable state and federal payroll deductions, which equals six months of your current base salary.
ii.COBRA: The Company will provide you and your dependents with COBRA benefits pursuant to the terms and conditions of Section 2(b) of that certain Retention and Ownership Change Event Agreement, effective as of May 6, 2019 (the “Retention Agreement”), by and between you and the Company. Notwithstanding the immediately foregoing sentence, if you are eligible for, and the Company determines, in its sole discretion, that it cannot pay, the COBRA premiums without a substantial risk of violating applicable law (including Section 2716 of the Public Health Service Act), the Company instead shall pay to you, on the first day of each calendar month, a fully taxable cash payment equal to the applicable COBRA premiums for that month, subject to applicable tax withholdings (such amount, the “Special Cash Payment”), for the remainder of the period you remain eligible for the benefit under the immediately foregoing sentence. You may, but are not obligated to, use such Special Cash Payments toward the cost of COBRA premiums.
iii.Partial Equity Vesting Acceleration: Subject to your completion of the Transition Services and in exchange for your agreement to the general release and waiver of claims and covenant not to sue set forth in Exhibit A, the Company will accelerate the vesting of 50% of your restricted stock units that are scheduled to vest on or before June 10, 2021, such that, on the effective date of the Second Release, the restricted stock units will have vested as to 12,967 shares (“Accelerated Vested Shares”).
d.At-Will Employment: During the Transition Period, your employment with the Company will remain at-will, meaning either you or the Company may terminate your employment at any time with or without notice or reason. However, provided that you diligently and cooperatively provide the Transition Services (as determined by the Company in good faith and in its sole discretion), in the event the Company terminates your employment prior to the Separation Date, the Company will offer you the benefits described in Paragraph 2(c), above. In the event that the Company terminates your employment prior to the Separation Date for failing to provide the Transition Services (including for failing to do so in a diligent and cooperative fashion, as determined by the Company in good faith and in its sole discretion) or you resign from employment for any reason prior to the Separation Date, you will not be eligible to receive, and the Company will not be obligated to offer to you, the vesting acceleration described in Paragraph 2(c)(iii), above.
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By signing below, you acknowledge that you are receiving the release consideration outlined in Section 2(c) in consideration for waiving your rights to claims referred to in this Agreement (and the Second Release, if applicable) and that you would not otherwise be entitled to the release consideration.
3.Final Pay: On your final day of employment, the Company will pay you for all wages, salary, bonuses, commissions, reimbursable expenses previously submitted by you, accrued vacation (if applicable) and any similar payments due you from the Company as of your separation from employment. On your final day of employment, the Company will also refund o you, your accumulated payroll deductions with respect to the current offering period under the Company’s 1999 Employee Stock Purchase Plan (the “ESPP”), which have not been applied toward the purchase of shares, and your interest in the ESPP will terminate. By signing below, you acknowledge that the Company does not owe you any other amounts, except as otherwise may become payable under this Agreement.
4.Return of Company Property: You hereby warrant to the Company that, no later than your final day of employment, you will return to the Company all property or data of the Company of any type whatsoever that has been in your possession or control.
5.Proprietary Information: You hereby acknowledge that you are bound by the attached Proprietary Information and Inventions Agreement (Exhibit B hereto) and that as a result of your employment with the Company you have had access to the Company’s Proprietary Information (as defined in the agreement). You hereby agree that you will hold all Proprietary Information in strictest confidence and that you will not make use of such Proprietary Information, except as required in the course of your employment with the Company. You further confirm that you will deliver to the Company, no later than the Separation Date, all documents and data of any nature containing or pertaining to such Proprietary Information and that you will not take with you any such documents or data or any reproduction thereof.
6.Stock Options and Restricted Stock Units: Attached as Exhibit C is your Option/RSU Statement setting forth the status of your option(s), if any, to purchase shares of the Company’s common stock, including how many shares are exercisable, as well as your restricted stock units, if any, including the number of shares that are released as of the Separation Date. During the Transition Period, your rights concerning your option(s) and restricted stock units will continue to be governed by the applicable stock option plan and stock option agreement(s)/restricted stock unit agreements between you and the Company; however, all vesting will cease as of the Separation Date (assuming your continuous employment through that date).
7.General Release and Waiver of Claims:
a.The payments and promises set forth in this Agreement are in full satisfaction of all accrued salary, vacation pay, bonus and commission pay, profitsharing, stock, stock options or other ownership interest in the Company, termination benefits or other compensation to which you may be entitled by virtue of your employment with the Company or your separation from the Company. To the fullest extent permitted by law, you hereby release and waive any other claims you may have against the Company and its owners, agents, officers,
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shareholders, employees, directors, attorneys, subscribers, subsidiaries, affiliates, successors and assigns (collectively “Releasees”), whether known or not known, including, without limitation, claims under any employment laws, including, but not limited to, claims of unlawful discharge, breach of contract, breach of the covenant of good faith and fair dealing, fraud, violation of public policy, defamation, physical injury, emotional distress, claims for additional compensation or benefits arising out of your employment or your separation of employment, claims under Title VII of the 1964 Civil Rights Act, as amended, and any other laws and/or regulations relating to employment or employment discrimination, including, without limitation, claims based on age or under the Age Discrimination in Employment Act or Older Workers Benefit Protection Act, and/or claims based on disability or under the Americans with Disabilities Act. By signing this Agreement, you are not releasing or waiving any claims under the California Fair Employment and Housing Act; however, for the avoidance of doubt, you will release and waive such claims once you sign the Second Release.
b.In exchange for the consideration received herein, to the fullest extent permitted by law, the Company, its parent, subsidiaries and affiliates, hereby release and waive any claims they may have against you, whether known or not known, including without limitation, claims for breach of any obligations to the Company, including but not limited to claims for breach of fiduciary duty and/or breach of any contractual or common law duty to the Company; provided that such release shall not apply to (i) any fraud committed by you against the Company or its subsidiaries, (ii) any material misappropriation of the trade secrets or other intellectual property of the Company or its subsidiaries, or (iii) any material breach of your Proprietary Information and Inventions Agreement with the Company.
c.By signing below, the Company and you expressly waive any benefits of Section 1542 of the Civil Code of the State of California, which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
d.You and the Company do not intend to release claims that you may not release as a matter of law, including but not limited to claims for indemnity under California Labor Code Section 2802, or any claims for enforcement of this Agreement. To the fullest extent permitted by law, any dispute regarding the scope of this general release shall be determined by an arbitrator under the procedures set forth in the arbitration clause below.
e.The release set forth in this section shall not apply to your rights to receive the payment and benefits set forth in the fourth, fifth, and sixth paragraphs of Section 2 of the Retention Agreement, upon a Section 409A Change in Control Event (as defined in the Retention Agreement) occurring on or before the ninetieth (90th) day following the Separation Date.
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8.Covenant Not to Sue:
a.To the fullest extent permitted by law, at no time subsequent to the execution of this Agreement will you or the Company pursue, or cause or knowingly permit the prosecution, in any state, federal or foreign court, or before any local, state, federal or foreign administrative agency, or any other tribunal, of any charge, claim or action of any kind, nature and character whatsoever, known or unknown, which you may now have, have ever had, or may in the future have against Releasees, or which Company may have against you, which is based in whole or in part on any matter released by this Agreement.
b.Nothing in this paragraph shall prohibit or impair you or the Company from complying with all applicable laws, nor shall this Agreement be construed to obligate either party to commit (or aid or abet in the commission of) any unlawful act.
9.Protected Rights: You understand that nothing in the General Release and Waiver of Claims and Covenant Not to Sue paragraphs above, or otherwise in this Agreement, limits your ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state or local government agency or commission (“Government Agencies”). You further understand that this Agreement does not limit your ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company. This Agreement does not limit your right to receive an award for information provided to any Government Agencies.
10.Arbitration: Except for any claim for injunctive relief arising out of a breach of a party’s obligations to protect the other’s proprietary information, the parties agree to arbitrate, in San Jose, California through JAMS, any and all disputes or claims arising out of or related to the validity, enforceability, interpretation, performance or breach of this Agreement, whether sounding in tort, contract, statutory violation or otherwise, or involving the construction or application or any of the terms, provisions, or conditions of this Agreement. Any arbitration may be initiated by a written demand to the other party. The arbitrator’s decision shall be final, binding, and conclusive. The parties further agree that this Agreement is intended to be strictly construed to provide for arbitration as the sole and exclusive means for resolution of all disputes hereunder to the fullest extent permitted by law. The parties expressly waive any entitlement to have such controversies decided by a court or a jury.
11.Attorneys’ Fees: If any action is brought to enforce the terms of this Agreement, the prevailing party will be entitled to recover its reasonable attorneys’ fees, costs and expenses from the other party, in addition to any other relief to which the prevailing party may be entitled.
12.No Admission of Liability: This Agreement is not and shall not be construed or contended by you to be an admission or evidence of any wrongdoing or liability on the part of Releasees, their representatives, heirs, executors, attorneys, agents, partners, officers, shareholders, directors, employees, subsidiaries, affiliates, divisions, successors or assigns. This
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Agreement shall be afforded the maximum protection allowable under California Evidence Code Section 1152 and/or any other state or federal provisions of similar effect.
13.Complete and Voluntary Agreement: This Agreement, together with Exhibits A-C hereto, constitute the entire agreement between you and Releasees with respect to the subject matter hereof and supersedes all prior negotiations and agreements, whether written or oral, relating to such subject matter. You acknowledge that neither Releasees nor their agents or attorneys have made any promise, representation or warranty whatsoever, either express or implied, written or oral, which is not contained in this Agreement for the purpose of inducing you to execute the Agreement, and you acknowledge that you have executed this Agreement in reliance only upon such promises, representations and warranties as are contained herein, and that you are executing this Agreement voluntarily, free of any duress or coercion.
14.Severability: The provisions of this Agreement are severable, and if any part of it is found to be invalid or unenforceable, the other parts shall remain fully valid and enforceable. Specifically, should a court, arbitrator, or government agency conclude that a particular claim may not be released as a matter of law, it is the intention of the parties that the general release, the waiver of unknown claims and the covenant not to sue above shall otherwise remain effective to release any and all other claims.
15.Modification; Counterparts; Facsimile/PDF Signatures: It is expressly agreed that this Agreement may not be altered, amended, modified, or otherwise changed in any respect except by another written agreement that specifically refers to this Agreement, executed by authorized representatives of each of the parties to this Agreement. This Agreement may be executed in any number of counterparts, each of which shall constitute an original and all of which together shall constitute one and the same instrument. Execution of a facsimile or PDF copy shall have the same force and effect as execution of an original, and a copy of a signature will be equally admissible in any legal proceeding as if an original.
16.Governing Law: This Agreement shall be governed by and construed in accordance with the laws of the State of California.
17.Review of Separation Agreement; Expiration of Offer: You understand that you may take up to twenty-one (21) days to consider this Agreement (the “Consideration Period”). The offer set forth in this Agreement, if not accepted by you before the end of the Consideration Period, will automatically expire. By signing below, you affirm that you were advised to consult with an attorney prior to signing this Agreement. You also understand you may revoke this Agreement within seven (7) days of signing this document and that the separation compensation to be provided to you pursuant to Section 2 will be provided only after the expiration of that seven (7) day revocation period.
18.Effective Date: This Agreement is effective on the eighth (8th) day after you sign it provided you have not revoked the Agreement as of that time (the “Effective Date”).
[Signature Page Follows]
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If you agree to abide by the terms outlined in this Agreement, please sign and return it to me. I wish you the best in your future endeavors.
Sincerely,
Immersion Corporation
By: _/s/ Jared Smith_______________________
Jared Smith, Interim CEO
READ, UNDERSTOOD AND AGREED
/s/ Mike Okada__________________ Date: May 17, 2021______
Mike Okada
Mike Okada
EXHIBIT A
SECOND RELEASE
This General Release of All Claims and Covenant Not to Sue (the “Second Release”) is entered into between Mike Okada (“Employee”) and Immersion Corporation, a Delaware corporation (the “Company”) (collectively, “the parties”).
WHEREAS, on May 17, 2021, Employee and the Company entered into an agreement regarding Employee’s transition and separation from employment with the Company (the “Separation Agreement,” to which this Second Release is attached as Exhibit A);
WHEREAS, on May 21, 2021, Employee’s employment with the Company terminated (the “Separation Date”);
WHEREAS, the Company has determined that Employee cooperatively and diligently provided the Transition Services (as defined in the Separation Agreement);
WHEREAS, this agreement serves as the Second Release, pursuant to the Separation Agreement; and
WHEREAS, Employee and the Company desire to mutually, amicably and finally resolve and compromise all issues and claims surrounding Employee’s employment and separation from employment with the Company.
NOW THEREFORE, in consideration for the mutual promises and undertakings of the parties as set forth below, Employee and the Company hereby enter into this Second Release.
1.Resignation from Director and Employment Positions: By your signature below, you acknowledge that, effective as of the Separation Date, you will have resigned as the General Counsel & Senior Vice President, IP Licensing and Legal Affairs of the Company, from any and all other officer and employment positions in the Company and its subsidiary and affiliate companies, and from the boards of directors or similar governing bodies of all of the Company’s subsidiary or affiliate companies, and all committees thereof.
2.Acknowledgment of Payment of Wages: By his signature below, Employee acknowledges that, on the Separation Date, the Company paid him for all wages, salary, accrued vacation (if applicable), bonuses, commissions, reimbursable expenses previously submitted by him, and any similar payments due him from the Company as of the Separation Date. By signing below, Employee acknowledges that the Company does not owe him any other amounts, except as may become payable under the Separation Agreement and the Second Release. Please promptly submit for reimbursement all final outstanding expenses, if any.
3.Return of Company Property: Employee hereby warrants to the Company that s/he has returned to the Company all property or data of the Company of any type whatsoever that has been in his possession, custody or control.
4.Consideration: In exchange for Employee’s agreement to this Second Release and his other promises in the Separation Agreement and herein, the Company agrees to provide
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Employee with the consideration set forth in Section 2(c) of the Separation Agreement. By signing below, Employee acknowledges that he is receiving the consideration in exchange for waiving his rights to claims referred to in this Second Release and he would not otherwise be entitled to the consideration.
5.General Release and Waiver of Claims:
a.The payments and promises set forth in this Second Release are in full satisfaction of all accrued salary, vacation pay, bonus and commission pay, profitsharing, stock, stock options or other ownership interest in the Company, termination benefits or other compensation to which Employee may be entitled by virtue of his employment with the Company or his separation from the Company, including pursuant to the Separation Agreement. To the fullest extent permitted by law, Employee hereby releases and waives any other claims he may have against the Company and its owners, agents, officers, shareholders, employees, directors, attorneys, subscribers, subsidiaries, affiliates, successors and assigns (collectively “Releasees”), whether known or not known, including, without limitation, claims under any employment laws, including, but not limited to, claims of unlawful discharge, breach of contract, breach of the covenant of good faith and fair dealing, fraud, violation of public policy, defamation, physical injury, emotional distress, claims for additional compensation or benefits arising out of his employment or separation of employment, claims under Title VII of the 1964 Civil Rights Act, as amended, the California Fair Employment and Housing Act and any other laws and/or regulations relating to employment or employment discrimination, including, without limitation, claims based on age or under the Age Discrimination in Employment Act or Older Workers Benefit Protection Act, and/or claims based on disability or under the Americans with Disabilities Act.
b.In exchange for the consideration received herein, to the fullest extent permitted by law, the Company, its parent, subsidiaries and affiliates, hereby release and waive any claims they may have against Employee, whether known or not known, including without limitation, claims for breach of any obligations to the Company, including but not limited to claims for breach of fiduciary duty and/or breach of any contractual or common law duty to the Company; provided that such release shall not apply to (i) any fraud committed by Employee against the Company or its subsidiaries, (ii) any material misappropriation of the trade secrets or other intellectual property of the Company or its subsidiaries, or (iii) any material breach of Employee’s Proprietary Information and Inventions Agreement with the Company.
c.By signing below, the Company and Employee expressly waive any benefits of Section 1542 of the Civil Code of the State of California, which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
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d.Employee and the Company do not intend to release claims that each may not release as a matter of law, including but not limited to claims for indemnity under California Labor Code Section 2802, or any claims for enforcement of this Second Release. To the fullest extent permitted by law, any dispute regarding the scope of this general release shall be determined by an arbitrator under the procedures set forth in the arbitration clause set forth in the Separation Agreement.
e.The release set forth in this section shall not apply to Employee’s rights to receive the payment and benefits set forth in the fourth, fifth, and sixth paragraphs of Section 2 of the Retention Agreement, upon a Section 409A Change in Control Event (as defined in the Retention Agreement) occurring on or before the ninetieth (90th) day following the Separation Date.
6.Covenant Not to Sue:
a.To the fullest extent permitted by law, at no time subsequent to the execution of this Second Release will Employee or the Company pursue, or cause or knowingly permit the prosecution, in any state, federal or foreign court, or before any local, state, federal or foreign administrative agency, or any other tribunal, of any charge, claim or action of any kind, nature and character whatsoever, known or unknown, which he may now have, have ever had, or may in the future have against Releasees, or which Company may have against Employee, which is based in whole or in part on any matter released by this Second Release.
b.Nothing in this paragraph shall prohibit or impair Employee or the Company from complying with all applicable laws, nor shall this Second Release be construed to obligate either party to commit (or aid or abet in the commission of) any unlawful act.
7.Protected Rights: Employee understands that nothing in the General Release and Waiver of Claims and Covenant Not to Sue paragraphs above, or otherwise in this Second Release, limits his ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state or local government agency or commission (“Government Agencies”). Employee further understands that this Second Release does not limit his/her ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company. This Second Release does not limit Employee’s right to receive an award for information provided to any Government Agencies.
8.Non-disparagement: Employee agrees that he will not disparage Releasees or their products, services, agents, representatives, directors, officers, shareholders, attorneys, employees, vendors, affiliates, successors or assigns, or any person acting by, through, under or in concert with any of them, with any written or oral statement. The Company agrees that its current officers and directors, for so long as they serve as an officer or director of the Company, will not disparage you with any written or oral statement. Nothing in this section shall prohibit you or the Company from providing truthful information in response to a subpoena or other legal
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process. Nothing in this section shall prohibit the Company, in response to inquiries regarding the Company from Company investors, prospective investors, analysts, business partners and other third parties or in other public or privately communicated statements, from responding to such inquiries or making such other statements containing information or observations made in good faith and believed to be accurate regarding the Company’s business, performance or strategy, and such responses shall not be deemed a violation of the Company’s non-disparagement obligation.
9.Review of Second Release; Expiration of Offer: Employee understands that s/he may take up to twenty-one (21) days to consider this Second Release (the “Consideration Period”). The offer set forth in this Second Release, if not accepted by Employee before the end of the Consideration Period, will automatically expire. By signing below, Employee affirms that he was advised to consult with an attorney prior to signing this Second Release. Employee also understands that he may revoke this Second Release within seven (7) days of signing this document and that the consideration to be provided to him pursuant to Section 2(c) of the Separation Agreement will be provided only after the expiration of that seven (7) day revocation period.
10.Effective Date: This Second Release is effective on the eighth (8th) day after Employee signs it, provided s/he has not revoked it as of that time (the “Effective Date”).
11.Other Terms of Separation Agreement Incorporated Herein: All other terms of the Separation Agreement to the extent not inconsistent with the terms of this Second Release are hereby incorporated in this Second Release as though fully stated herein and apply with equal force to this Second Release, including, without limitation, the provisions on Arbitration, Governing Law, and Attorneys’ Fees.
12.Amendment to Award Agreements. Any agreements regarding Employee’s restricted stock units issued under the Company’s 2011 Equity Incentive Plan, as amended, are hereby amended consistent with the Separation Agreement.
Dated:____________________ ________________________________
Jared Smith, Interim CEO For the Company
Jared Smith, Interim CEO For the Company
Dated:____________________ ________________________________
Mike Okada
Mike Okada
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EXHIBIT B
PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT
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EXHIBIT C
OPTION/RSU CLOSING STATEMENT
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