Exhibit 10.6
Actuate Corporation
2001 Supplemental Stock Plan
(As Adopted Effective January 2, 2001)
TABLE OF CONTENTS
Page
ARTICLE 1. INTRODUCTION........................................................................... 1
ARTICLE 2. ADMINISTRATION......................................................................... 1
2.1 Committee Composition.................................................................... 1
2.2 Committee Responsibilities............................................................... 1
ARTICLE 3. SHARES AVAILABLE FOR GRANTS............................................................ 1
3.1 Basic Limitation......................................................................... 1
3.2 Additional Shares........................................................................ 1
ARTICLE 4. ELIGIBILITY............................................................................ 2
ARTICLE 5. OPTIONS................................................................................ 2
5.1 Stock Option Agreement................................................................... 2
5.2 Number of Shares......................................................................... 2
5.3 Exercise Price........................................................................... 2
5.4 Exercisability and Term.................................................................. 2
5.5 Modification or Assumption of Options.................................................... 2
5.6 Buyout Provisions........................................................................ 2
ARTICLE 6. CHANGE IN CONTROL...................................................................... 3
6.1 Effect of Change in Control.............................................................. 3
6.2 Involuntary Termination.................................................................. 3
ARTICLE 7. PAYMENT FOR OPTION SHARES.............................................................. 3
7.1 General Rule............................................................................. 3
7.2 Surrender of Stock....................................................................... 3
7.3 Exercise/Sale............................................................................ 3
7.4 Exercise/Pledge.......................................................................... 3
7.5 Promissory Note.......................................................................... 4
7.6 Other Forms of Payment................................................................... 4
ARTICLE 8. RESTRICTED SHARES...................................................................... 4
8.1 Restricted Stock Agreement............................................................... 4
8.2 Payment for Awards....................................................................... 4
8.3 Vesting Conditions....................................................................... 4
8.4 Voting and Dividend Rights............................................................... 4
ARTICLE 9. PROTECTION AGAINST DILUTION............................................................ 4
9.1 Adjustments.............................................................................. 4
9.2 Dissolution or Liquidation............................................................... 5
9.3 Reorganizations.......................................................................... 5
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ARTICLE 10. DEFERRAL OF DELIVERY OF SHARES.......................................................... 5
ARTICLE 11. AWARDS UNDER OTHER PLANS................................................................ 5
ARTICLE 12. LIMITATION ON RIGHTS.................................................................... 6
12.1 Retention Rights.......................................................................... 6
12.2 Stockholders' Rights...................................................................... 6
12.3 Regulatory Requirements................................................................... 6
ARTICLE 13. WITHHOLDING TAXES....................................................................... 6
13.1 General................................................................................... 6
13.2 Share Withholding......................................................................... 6
ARTICLE 14. FUTURE OF THE PLAN...................................................................... 6
14.1 Term of the Plan.......................................................................... 6
14.2 Amendment or Termination.................................................................. 7
ARTICLE 15. DEFINITIONS............................................................................. 7
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Actuate Corporation
2001 Supplemental Stock Plan
ARTICLE 1. INTRODUCTION.
The Plan was adopted by the Board effective January 2, 2001. The
purpose of the Plan is to promote the long-term success of the Company and the
creation of stockholder value by (a) encouraging Employees and Consultants to
focus on critical long-range objectives, (b) encouraging the attraction and
retention of Employees and Consultants with exceptional qualifications and (c)
linking Employees and Consultants directly to stockholder interests through
increased stock ownership. The Plan seeks to achieve this purpose by providing
for Awards in the form of Restricted Shares or Options (which shall constitute
nonstatutory stock options).
The Plan shall be governed by, and construed in accordance with, the
laws of the State of Delaware (except their choice-of-law provisions).
ARTICLE 2. ADMINISTRATION.
2.1 Committee Composition. The Committee shall administer the Plan.
The Committee shall consist exclusively of one or more directors of the Company,
who shall be appointed by the Board.
2.2 Committee Responsibilities. The Committee shall (a) select the
Employees and Consultants who are to receive Awards under the Plan, (b)
determine the type, number, vesting requirements and other features and
conditions of such Awards, (c) interpret the Plan and (d) make all other
decisions relating to the operation of the Plan. The Committee may adopt such
rules or guidelines as it deems appropriate to implement the Plan. The
Committee's determinations under the Plan shall be final and binding on all
persons.
ARTICLE 3. SHARES AVAILABLE FOR GRANTS.
3.1 Basic Limitation. Common Shares issued pursuant to the Plan may
be authorized but unissued shares or treasury shares. The aggregate number of
Options and Restricted Shares awarded under the Plan shall not exceed (a)
2,700,000 plus (b) the additional Common Shares described in Section 3.2. The
limitations of this Section 3.1 and Section 3.2 shall be subject to adjustment
pursuant to Article 8.
3.2 Additional Shares. If Options are forfeited or terminate for any
other reason before being exercised, then the corresponding Common Shares shall
again become available for the grant of Options or Restricted Shares under the
Plan. If Restricted Shares or Common Shares issued upon the exercise of Options
are forfeited, then such Common Shares shall again become available for the
grant of Options and Restricted Shares under the Plan.
ARTICLE 4. ELIGIBILITY.
Employees and Consultants shall be eligible for the grant of Awards,
except that members of the Board and individuals who are considered officers of
the Company under the rules of the National Association of Securities Dealers
shall not be eligible for the grant of Awards.
ARTICLE 5. OPTIONS.
5.1 Stock Option Agreement. Each grant of an Option under the Plan
shall be evidenced by a Stock Option Agreement between the Optionee and the
Company. Such Option shall be subject to all applicable terms of the Plan and
may be subject to any other terms that are not inconsistent with the Plan. The
provisions of the various Stock Option Agreements entered into under the Plan
need not be identical. Options may be granted in consideration of a reduction in
the Optionee's other compensation. A Stock Option Agreement may provide that a
new Option will be granted automatically to the Optionee when he or she
exercises a prior Option and pays the Exercise Price in the form described in
Section 6.2.
5.2 Number of Shares. Each Stock Option Agreement shall specify the
number of Common Shares subject to the Option and shall provide for the
adjustment of such number in accordance with Article 8.
5.3 Exercise Price. Each Stock Option Agreement shall specify the
Exercise Price; provided that the Exercise Price shall in no event be less than
85% of the Fair Market Value of a Common Share on the date of grant. A Stock
Option Agreement may specify an Exercise Price that varies in accordance with a
predetermined formula while the Option is outstanding.
5.4 Exercisability and Term. Each Stock Option Agreement shall
specify the date or event when all or any installment of the Option is to become
exercisable. The Stock Option Agreement shall also specify the term of the
Option. A Stock Option Agreement may provide for accelerated exercisability in
the event of the Optionee's death, disability or retirement or other events and
may provide for expiration prior to the end of its term in the event of the
termination of the Optionee's service.
5.5 Modification or Assumption of Options. Within the limitations of
the Plan, the Committee may modify, extend or assume outstanding options or may
accept the cancellation of outstanding options (whether granted by the Company
or by another issuer) in return for the grant of new options for the same or a
different number of shares and at the same or a different exercise price. The
foregoing notwithstanding, no modification of an Option shall, without the
consent of the Optionee, alter or impair his or her rights or obligations under
such Option.
5.6 Buyout Provisions. The Committee may at any time (a) offer to buy
out for a payment in cash or cash equivalents an Option previously granted or
(b) authorize an Optionee to elect to cash out an Option previously granted, in
either case at such time and based upon such terms and conditions as the
Committee shall establish.
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ARTICLE 6. CHANGE IN CONTROL.
6.1 Effect of Change in Control. In the event of any Change in
Control, each outstanding Award shall automatically accelerate so that each such
Award shall, immediately prior to the effective date of the Change in Control,
become fully exercisable for all of the shares of Common Stock at the time
subject to such Award and may be exercised for any or all of those shares as
fully-vested shares of Common Stock. However, an outstanding Award shall not so
accelerate if and to the extent such Award is, in connection with the Change in
Control, either to be assumed by the successor corporation (or parent thereof)
or to be replaced with a comparable Award for shares of the capital stock of the
successor corporation (or parent thereof). The determination of Award
comparability shall be made by the Plan Administrator, and its determination
shall be final, binding and conclusive.
6.2 Involuntary Termination. In addition, except as otherwise
provided in the Agreement evidencing an Award, in the event that the Award is
assumed by the successor corporation (or parent thereof) and the Participant
experiences an Involuntary Termination within twelve months following a Change
in Control, each outstanding Award shall automatically accelerate so that each
such Award shall, immediately prior to the effective date of the Involuntary
Termination, become fully exercisable for all of the shares of Common Stock at
the time subject to such Award and may be exercised for any or all of those
shares as fully-vested shares of Common Stock.
ARTICLE 7. PAYMENT FOR OPTION SHARES.
7.1 General Rule. The entire Exercise Price of Common Shares issued
upon exercise of Options shall be payable in cash or cash equivalents at the
time when such Common Shares are purchased, unless the Committee accepts payment
in any other form(s) described in this Article 7.
7.2 Surrender of Stock. To the extent that this Section 7.2 is
applicable, all or any part of the Exercise Price may be paid by surrendering,
or attesting to the ownership of, Common Shares that are already owned by the
Optionee. Such Common Shares shall be valued at their Fair Market Value on the
date when the new Common Shares are purchased under the Plan. The Optionee shall
not surrender, or attest to the ownership of, Common Shares in payment of the
Exercise Price if such action would cause the Company to recognize compensation
expense (or additional compensation expense) with respect to the Option for
financial reporting purposes.
7.3 Exercise/Sale. To the extent that this Section 7.3 is applicable,
all or any part of the Exercise Price and any withholding taxes may be paid by
delivering (on a form prescribed by the Company) an irrevocable direction to a
securities broker approved by the Company to sell all or part of the Common
Shares being purchased under the Plan and to deliver all or part of the sales
proceeds to the Company.
7.4 Exercise/Pledge. To the extent that this Section 7.4 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) an irrevocable
direction to pledge all or part of the Common Shares
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being purchased under the Plan to a securities broker or lender approved by the
Company, as security for a loan, and to deliver all or part of the loan proceeds
to the Company.
7.5 Promissory Note. To the extent that this Section 7.5 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) a full-recourse
promissory note. However, the par value of the Common Shares being purchased
under the Plan, if newly issued, shall be paid in cash or cash equivalents.
7.6 Other Forms of Payment. To the extent that this Section 7.6 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid in any other form that is consistent with applicable laws, regulations
and rules.
ARTICLE 8. RESTRICTED SHARES.
8.1 Restricted Stock Agreement. Each grant of Restricted Shares under
the Plan shall be evidenced by a Restricted Stock Agreement between the
recipient and the Company. Such Restricted Shares shall be subject to all
applicable terms of the Plan and may be subject to any other terms that are not
inconsistent with the Plan. The provisions of the various Restricted Stock
Agreements entered into under the Plan need not be identical.
8.2 Payment for Awards. Subject to the following sentence, Restricted
Shares may be sold or awarded under the Plan for such consideration as the
Committee may determine, including (without limitation) cash, cash equivalents,
full-recourse promissory notes, past services and future services. To the extent
that an Award consists of newly issued Restricted Shares, the consideration
shall consist exclusively of cash, cash equivalents or past services rendered to
the Company (or a Parent or Subsidiary) or, for the amount in excess of the par
value of such newly issued Restricted Shares, full-recourse promissory notes, as
the Committee may determine.
8.3 Vesting Conditions. Each Award of Restricted Shares may or may
not be subject to vesting. Vesting shall occur, in full or in installments, upon
satisfaction of the conditions specified in the Restricted Stock Agreement. A
Restricted Stock Agreement may provide for accelerated vesting in the event of
the Participant's death, disability or retirement or other events.
8.4 Voting and Dividend Rights. The holders of Restricted Shares
awarded under the Plan shall have the same voting, dividend and other rights as
the Company's other stockholders. A Restricted Stock Agreement, however, may
require that the holders of Restricted Shares invest any cash dividends received
in additional Restricted Shares. Such additional Restricted Shares shall be
subject to the same conditions and restrictions as the Award with respect to
which the dividends were paid.
ARTICLE 9. PROTECTION AGAINST DILUTION.
9.1 Adjustments. In the event of a subdivision of the outstanding
Common Shares, a declaration of a dividend payable in Common Shares, a
declaration of a dividend
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payable in a form other than Common Shares in an amount that has a material
effect on the price of Common Shares, a combination or consolidation of the
outstanding Common Shares (by reclassification or otherwise) into a lesser
number of Common Shares, a recapitalization, a spin-off or a similar occurrence,
the Committee shall make such adjustments as it, in its sole discretion, deems
appropriate in one or more of (a) the number of Options and Restricted Shares
available for future Awards under Article 3, (b) the number of Common Shares
covered by each outstanding Option or (c) the Exercise Price under each
outstanding Option. Except as provided in this Article 8, a Participant shall
have no rights by reason of any issue by the Company of stock of any class or
securities convertible into stock of any class, any subdivision or consolidation
of shares of stock of any class, the payment of any stock dividend or any other
increase or decrease in the number of shares of stock of any class.
9.2 Dissolution or Liquidation. To the extent not previously
exercised, Options shall terminate immediately prior to the dissolution or
liquidation of the Company.
9.3 Reorganizations. In the event that the Company is a party to a
merger or other reorganization, outstanding Options and Restricted Shares shall
be subject to the agreement of merger or reorganization. Such agreement shall
provide for (a) the continuation of the outstanding Awards by the Company, if
the Company is a surviving corporation, (b) the assumption of the outstanding
Awards by the surviving corporation or its parent or subsidiary, (c) the
substitution by the surviving corporation or its parent or subsidiary of its own
awards for the outstanding Awards, (d) full exercisability or vesting and
accelerated expiration of the outstanding Awards or (e) settlement of the full
value of the outstanding Awards in cash or cash equivalents followed by
cancellation of such Awards.
ARTICLE 10. DEFERRAL OF DELIVERY OF SHARES.
The Committee (in its sole discretion) may permit or require an
Optionee to have Common Shares that otherwise would be delivered to such
Optionee as a result of the exercise of an Option converted into amounts
credited to a deferred compensation account established for such Optionee by the
Committee as an entry on the Company's books. Such amounts shall be determined
by reference to the Fair Market Value of such Common Shares as of the date when
they otherwise would have been delivered to such Optionee. A deferred
compensation account established under this Article 10 may be credited with
interest or other forms of investment return, as determined by the Committee.
An Optionee for whom such an account is established shall have no rights other
than those of a general creditor of the Company. Such an account shall
represent an unfunded and unsecured obligation of the Company and shall be
subject to the terms and conditions of the applicable agreement between such
Optionee and the Company. If the conversion of Options is permitted or
required, the Committee (in its sole discretion) may establish rules, procedures
and forms pertaining to such conversion, including (without limitation) the
settlement of deferred compensation accounts established under this Article 9.
ARTICLE 11. AWARDS UNDER OTHER PLANS.
The Company may grant awards under other plans or programs. Such
awards may be settled in the form of Common Shares issued under this Plan. Such
Common Shares
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shall be treated for all purposes under the Plan like Restricted Shares and
shall, when issued, reduce the number of Common Shares available under Article
3.
ARTICLE 12. LIMITATION ON RIGHTS.
12.1 Retention Rights. Neither the Plan nor any Award granted under
the Plan shall be deemed to give any individual a right to remain an Employee or
Consultant. The Company and its Parents, Subsidiaries and Affiliates reserve the
right to terminate the service of any Employee or Consultant at any time, with
or without cause, subject to applicable laws and a written employment agreement
(if any).
12.2 Stockholders' Rights. A Participant shall have no dividend
rights, voting rights or other rights as a stockholder with respect to any
Common Shares covered by his or her Award prior to the time when a stock
certificate for such Common Shares is issued or, in the case of an Option, the
time when he or she becomes entitled to receive such Common Shares by filing a
notice of exercise and paying the Exercise Price. No adjustment shall be made
for cash dividends or other rights for which the record date is prior to such
time, except as expressly provided in the Plan.
12.3 Regulatory Requirements. Any other provision of the Plan
notwithstanding, the obligation of the Company to issue Common Shares under the
Plan shall be subject to all applicable laws, rules and regulations and such
approval by any regulatory body as may be required. The Company reserves the
right to restrict, in whole or in part, the delivery of Common Shares pursuant
to any Award prior to the satisfaction of all legal requirements relating to the
issuance of such Common Shares, to their registration, qualification or listing
or to an exemption from registration, qualification or listing.
ARTICLE 13. WITHHOLDING TAXES.
13.1 General. To the extent required by applicable federal, state,
local or foreign law, a Participant or his or her successor shall make
arrangements satisfactory to the Company for the satisfaction of any withholding
tax obligations that arise in connection with the Plan. The Company shall not be
required to issue any Common Shares or make any cash payment under the Plan
until such obligations are satisfied.
13.2 Share Withholding. To the extent that applicable law subjects a
Participant to tax withholding obligations, the Committee may permit such
Participant to satisfy all or part of such obligations by having the Company
withhold all or a portion of any Common Shares that otherwise would be issued to
him or her or by surrendering all or a portion of any Common Shares that he or
she previously acquired. Such Common Shares shall be valued at their Fair Market
Value on the date when they are withheld or surrendered.
ARTICLE 14. FUTURE OF THE PLAN.
14.1 Term of the Plan. The Plan, as set forth herein, shall become
effective on January 2, 2001. The Plan shall remain in effect until it is
terminated under Section 14.2.
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14.2 Amendment or Termination. The Board may, at any time and for any
reason, amend or terminate the Plan. An amendment of the Plan shall be subject
to the approval of the Company's stockholders only to the extent required by
applicable laws, regulations or rules. No Awards shall be granted under the Plan
after the termination thereof. The termination of the Plan, or any amendment
thereof, shall not affect any Award previously granted under the Plan.
ARTICLE 15. DEFINITIONS.
15.1 "Affiliate" means any entity other than a Subsidiary, if the
Company and/or one or more Subsidiaries own not less than 50% of such entity.
15.2 "Award" means any award of an Option or a Restricted Share under
the Plan.
15.3 "Board" means the Company's Board of Directors, as constituted
from time to time.
15.4 "Change in Control" means:
(a) The consummation of a merger or consolidation of the
Company with or into another entity or any other corporate reorganization,
if persons who were not stockholders of the Company immediately prior to
such merger, consolidation or other reorganization own immediately after
such merger, consolidation or other reorganization 50% or more of the
voting power of the outstanding securities of each of (i) the continuing or
surviving entity and (ii) any direct or indirect parent corporation of such
continuing or surviving entity;
(b) The sale, transfer or other disposition of all or
substantially all of the Company's assets;
(c) A change in the composition of the Board, as a result of
which fewer than two-thirds of the incumbent directors are directors who
either (i) had been directors of the Company on the date 24 months prior to
the date of the event that may constitute a Change in Control (the
"original directors") or (ii) were elected, or nominated for election, to
the Board with the affirmative votes of at least a majority of the
aggregate of the original directors who were still in office at the time of
the election or nomination and the directors whose election or nomination
was previously so approved; or
(d) Any transaction as a result of which any person is the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing at least
50% of the total voting power represented by the Company's then outstanding
voting securities. For purposes of this Subsection (d), the term "person"
shall have the same meaning as when used in sections 13(d) and 14(d) of the
Exchange Act but shall exclude (i) a trustee or other fiduciary holding
securities under an employee
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benefit plan of the Company or of a Parent or Subsidiary and (ii) a
corporation owned directly or indirectly by the stockholders of the Company
in substantially the same proportions as their ownership of the common
stock of the Company.
A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
15.5 "Code" means the Internal Revenue Code of 1986, as amended.
15.6 "Committee" means a committee of the Board, as described in
Article 2.
15.7 "Common Share" means one share of the common stock of the
Company.
15.8 "Company" means Actuate Corporation, a Delaware corporation.
15.9 "Consultant" means a consultant or adviser who provides bona
fide services to the Company, a Parent, a Subsidiary or an Affiliate as an
independent contractor. Service as a Consultant shall be considered employment
for all purposes of the Plan.
15.10 "Employee" means a common-law employee of the Company, a Parent,
a Subsidiary or an Affiliate.
15.11 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
15.12 "Exercise Price" means the amount for which one Common Share may
be purchased upon exercise of an Option, as specified in the applicable Stock
Option Agreement.
15.13 "Fair Market Value" means the market price of Common Shares,
determined by the Committee in good faith on such basis as it deems appropriate.
Whenever possible, the determination of Fair Market Value by the Committee shall
be based on the prices reported in The Wall Street Journal. Such determination
-----------------------
shall be conclusive and binding on all persons.
15.14 "Involuntary Termination" means the termination of the
Participant's service which occurs by reason of:
(a) such individual's involuntary dismissal or discharge by the
Corporation for reasons other than Misconduct, or
(b) such individual's voluntary resignation following (A) a
change in his or her position with the Corporation which materially reduces
his or her level of responsibility, (B) a reduction in his or her level of
compensation (including base salary, fringe benefits and participation in
bonus or incentive programs) or (C) a relocation of such individual's place
of employment by more
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than fifty (50) miles, provided and only if such change, reduction or
relocation is effected by the Corporation without the individual's consent.
15.15 "Misconduct" means the commission of any act of fraud,
embezzlement or dishonesty by the Participant, any unauthorized use or
disclosure by such person of confidential information or trade secrets of the
Corporation (or any Parent or Subsidiary), or any other intentional misconduct
by such person adversely affecting the business or affairs of the Corporation
(or any Parent or Subsidiary) in a material manner. The foregoing definition
shall not be deemed to be inclusive of all the acts or omissions which the
Corporation (or any Parent or Subsidiary) may consider as grounds for the
dismissal or discharge of any Participant or other person in the Service of the
Corporation (or any Parent or Subsidiary).
15.16 "NSO" means a stock option not described in sections 422 or 423
of the Code.
15.17 "Option" means an NSO granted under the Plan and entitling the
holder to purchase Common Shares.
15.18 "Optionee" means a person or estate who holds an Option.
15.19 "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain. A corporation that attains the status of a Parent on
a date after the adoption of the Plan shall be considered a Parent commencing as
of such date.
15.20 "Participant" means a person or estate who holds an Award.
15.21 "Plan" means this Actuate Corporation 2001 Supplemental Stock
Plan, as amended from time to time.
15.22 "Restricted Share" means a Common Share awarded under the Plan.
15.23 "Restricted Stock Agreement" means the agreement between the
Company and the recipient of a Restricted Share that contains the terms,
conditions and restrictions pertaining to such Restricted Share.
15.24 "Stock Option Agreement" means the agreement between the
Company and an Optionee that contains the terms, conditions and restrictions
pertaining to his or her Option.
15.25 "Subsidiary" means any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company, if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain. A corporation that attains
the status of a Subsidiary on a date after the adoption of the Plan shall be
considered a Subsidiary commencing as of such date.
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