Common use of Amendments to the Merger Agreement Clause in Contracts

Amendments to the Merger Agreement. Section 2.01. Section 4.01(f) of the Merger Agreement is hereby amended and superseded in all respects by the provisions of this First Amendment. As amended and restated, Section 4.01(f) reads in its entirety: (i) At the Merger Effective Time, except as otherwise agreed by Parent and the holder of Company Stock-Based Awards (as defined below) with respect to such holder’s Company Stock-Based Awards, each right of any kind, contingent or accrued, to receive Company Common Shares or benefits measured in whole or in part by the value of a number of Company Common Shares granted under the Incentive Plans or otherwise (including performance shares, restricted stock, restricted stock units, phantom units, deferred stock units and dividend equivalents) other than Company Stock Options and Company Restricted Shares (each, other than Company Restricted Shares and Company Stock Options, a “Company Stock-Based Award”), except for any Company Stock-Based Award that has been granted under the Accredited Home Lenders Holding Co. Deferred Compensation Plan (the “Deferred Compensation Plan”), whether vested or unvested, which is outstanding immediately prior to the Merger Effective Time, shall become fully vested and free of any forfeiture or holding restrictions or performance or other restrictions, shall cease to represent a right or award with respect to Company Common Shares, and shall entitle the holder thereof to receive, at the Merger Effective Time, an amount in cash equal to the Merger Consideration in respect of each Company Common Share underlying a particular Company Stock-Based Award less such amounts as are required to be withheld or deducted under the Code or any provision of U.S. state or local tax law with respect to the making of such payment. (ii) At the Merger Effective Time, each Company Stock-Based Award, whether vested or unvested, which has been granted under the Deferred Compensation Plan and which is outstanding immediately prior to the Merger Effective Time, whether in trust or not, shall be treated as follows: (A) such Company Stock-Based Award shall be exchanged at the Merger Effective Time for an amount in cash equal to the Merger Consideration in respect of each Company Common Share underlying a particular Company Stock-Based Award, (B) such cash amounts will be deposited in the trust related to the Deferred Compensation Plan and (C) and the vesting and distribution of such cash amounts and any subsequent earnings thereon will be in accordance with the terms of such Deferred Compensation Plan and upon which the related Company Stock-Based Award was granted and the elections of participants in the Deferred Compensation Plan.

Amendments to the Merger Agreement. (a) Section 2.01. Section 4.01(f2.01(c) of the Merger Agreement (Conversion of Company Shares) is hereby amended by deleting the entire first sentence thereof and replacing it with the following: Subject to Section 2.01(b), each issued and outstanding Company Share automatically shall be converted into and shall thereafter represent the right to receive, in accordance with Section 2.02, a number of validly issued, fully paid and non-assessable Bermuda Holdco Shares equal to the Stock Conversion Number (the “Stock Consideration” and, together with any cash paid in lieu of fractional shares in accordance with Section 2.02(d), the “Merger Consideration”). (b) Section 2.02(b) of the Merger Agreement (Payment of Merger Consideration) is hereby amended by deleting the entire second sentence thereof and replacing it with the following: Upon the completion of such applicable procedures by a holder and the surrender of such holder’s Certificates or Book-Entry Shares, the Exchange Agent shall deliver to such holder (A) a certificate or book-entry representing that number of whole Bermuda Holdco Shares (rounded down to the nearest whole Bermuda Holdco Share) that such Stockholder has the right to receive in respect of the Company Shares represented thereby and (B) cash in lieu of fractional shares that such Stockholder has the right to receive pursuant to Section 2.02(d), and any surrendered Certificates shall forthwith be canceled. (c) Section 2.03(a) of the Merger Agreement (Equity Awards) is hereby amended and superseded in all respects by the provisions of this First Amendment. As amended and restated, Section 4.01(f) reads restated in its entirety: entirety to read as follows: At the Effective Time, without any action on the part of any Stockholder, each outstanding stock option granted under the Company Stock Plan or otherwise (a “Company Option”), shall automatically (i) At vest and become free of any forfeiture conditions if not then vested and free of forfeiture conditions and (ii) constitute a fully vested option (a “Converted Option”) to acquire (on the Merger same terms and conditions (other than vesting and performance conditions) as were applicable to such Company Option pursuant to the relevant Company Stock Plan under which it was issued and the agreement evidencing the grant thereof prior to the Effective Time, except as otherwise agreed ) that number (rounded down to the nearest whole number) of Bermuda Holdco Shares determined by Parent and multiplying (A) the holder of Company Stock-Based Awards (as defined below) with respect to such holder’s Company Stock-Based Awards, each right of any kind, contingent or accrued, to receive Company Common Shares or benefits measured in whole or in part by the value of a number of Company Common Shares granted under the Incentive Plans or otherwise (including performance shares, restricted stock, restricted stock units, phantom units, deferred stock units and dividend equivalents) other than subject to such Company Stock Options and Company Restricted Shares (each, other than Company Restricted Shares and Company Stock Options, a “Company Stock-Based Award”), except for any Company Stock-Based Award that has been granted under the Accredited Home Lenders Holding Co. Deferred Compensation Plan (the “Deferred Compensation Plan”), whether vested or unvested, which is outstanding Option immediately prior to the Merger Effective Time, Time by (B) the Stock Conversion Number. The exercise price per Bermuda Holdco Share subject to any such Converted Option shall become fully vested and free of any forfeiture or holding restrictions or performance or other restrictions, shall cease to represent a right or award with respect to Company Common Shares, and shall entitle the holder thereof to receive, at the Merger Effective Time, be an amount in cash (rounded up to the nearest cent) equal to (A) the Merger Consideration in respect of each exercise price per Company Common Share underlying a particular subject to such Company Stock-Based Award less such amounts as are required to be withheld or deducted under the Code or any provision of U.S. state or local tax law with respect to the making of such payment. (ii) At the Merger Effective Time, each Company Stock-Based Award, whether vested or unvested, which has been granted under the Deferred Compensation Plan and which is outstanding Option immediately prior to the Merger Effective Time, whether in trust or not, shall be treated as follows: (A) such Company Stock-Based Award shall be exchanged at the Merger Effective Time for an amount in cash equal to the Merger Consideration in respect of each Company Common Share underlying a particular Company Stock-Based Award, divided by (B) the Stock Conversion Number. Notwithstanding the foregoing, the assumption and conversion of Company Options under this Section 2.03 shall be implemented in such cash amounts will be deposited in a manner so as not to constitute (i) a “modification,” “extension” or “renewal” (within the trust related to meaning of Section 424 of the Deferred Compensation Plan and (C) Code and the vesting and distribution regulations thereunder) of such cash amounts and any subsequent earnings thereon will be in accordance with the terms of such Deferred Compensation Plan and upon which a Company Option that is an “incentive stock option” (as defined under Section 422 of the related Code) or (ii) a “modification” or “extension” of the terms of a Company Stock-Based Award was granted Option (within the meaning of Section 409A of the Code and the elections regulations thereunder). (d) Section 2.05 of participants the Merger Agreement (Dissenting Shares) is hereby deleted in its entirety. (e) Section 8.11(a) of the Deferred Compensation Plan.Merger Agreement (Definitions) is hereby amended as set forth below: i. The definition of “Stock Conversion Number” is hereby amended and restated in its entirety to read as follows:

Amendments to the Merger Agreement. Effective as of the execution hereof, the Company, Parent, and the Excess Cash Stockholders agree that the following shall be added at the end of Section 2.01. 2.2 of the Merger Agreement: “Notwithstanding anything to the contrary in the Merger Agreement, any Cash Merger Consideration payable to the Excess Cash Stockholders, in their capacity as stockholders of the Company with respect to their Cash Electing Shares, pursuant to Section 4.01(f2.3(a) and Section 2.6 of the Merger Agreement is hereby amended and superseded in all respects by the provisions of this First Amendment. As amended and restated, Section 4.01(f) reads in its entiretyshall be payable as follows: (i) At on the Merger Effective Time, except as otherwise agreed by Parent and date that is the holder of Company Stock-Based Awards 179th day following the Closing (as defined below) with respect to such holder’s Company Stock-Based Awards, each right of any kind, contingent or accrued, to receive Company Common Shares or benefits measured in whole or in part by the value of a number of Company Common Shares granted under the Incentive Plans or otherwise (including performance shares, restricted stock, restricted stock units, phantom units, deferred stock units and dividend equivalents) other than Company Stock Options and Company Restricted Shares (each, other than Company Restricted Shares and Company Stock Options, a “Company Stock-Based AwardInitial Interim Payment Date”), except for any Company Stock-Based Award that has been granted under Parent shall pay to the Accredited Home Lenders Holding Co. Deferred Compensation Plan Excess Cash Stockholders an aggregate amount of cash equal to $5 million (allocated among the Excess Cash Stockholders in accordance with Exhibit H) (the “Deferred Compensation PlanInterim Payment Amount”); provided, however, that if Parent is prohibited from paying all or a portion of the Interim Payment Amount on the Initial Interim Payment Date because the aggregate amount of all fees and expenses incurred by Parent, the Company and their respective Subsidiaries in connection with the Transactions (the “Fees and Expenses”), whether vested or unvestedtogether with the Cash Merger Consideration actually paid at Closing (the “Closing Cash”) and the Interim Payment Amount (collectively, which is outstanding immediately prior the “Transaction Expenses”) would exceed $40.0 million (the “Expense Cap”), then on the Initial Interim Payment Date, Parent shall pay to the Merger Effective Time, shall become fully vested and free of any forfeiture or holding restrictions or performance or other restrictions, shall cease to represent a right or award with respect to Company Common Shares, and shall entitle the holder thereof to receive, at the Merger Effective Time, Excess Cash Stockholders an amount equal to the difference of (x) $5.0 million and (y) the amount resulting from the difference of (A) the Expense Cap and (B) the sum of the Fees and Expenses and the Closing Cash; provided further, that Parent shall pay to the Excess Cash Stockholders the balance, if any, of the Interim Payment Amount as soon as practical following the Initial Interim Payment Date if it determines in good faith that it is permitted to do so in compliance with the Expense Cap; and (ii) on the earlier of (x) the date on which Parent completes a primary offering of equity securities that generates gross proceeds to Parent equal to or in excess of $15,000,000 and (y) the date that is four years and ninety-one days following the Closing (the “Final Payment Date”), Parent shall pay to the Excess Cash Stockholders an amount of cash equal to the lesser of (A) the difference of the Cash Merger Consideration in respect of each Company Common Share underlying a particular Company Stock-Based Award less such amounts as are required owed to be withheld or deducted under the Code or any provision of U.S. state or local tax law Excess Cash Stockholders with respect to their Cash Electing Shares and the making Interim Payment Amount (allocated among the Excess Cash Stockholders in accordance with Exhibit H) and (B) the amount resulting from the difference of such payment. (iix) At the Expense Cap and (y) the Transaction Expenses (the “Final Payment Amount”); provided, however, in no event shall the Excess Cash Stockholders be paid in excess of the Cash Merger Consideration that the Excess Cash Stockholders would have otherwise been entitled to receive pursuant to Section 2.3(a) and Section 2.6 of the Merger Effective TimeAgreement with respect to their Cash Electing Shares (the “Excess Cash Stockholders Cash Consideration Amount”). If the Final Payment Amount does not equal the Excess Cash Stockholders Cash Consideration Amount, each Company StockParent shall issue the Excess Cash Stockholders a number of shares of Parent Common Stock equal to the quotient of (X) the difference of (I) the Excess Cash Stockholders Cash Consideration Amount and (II) the sum of the Final Payment Amount and the Interim Payment Amount divided by (Y) the 10-Based Award, whether vested day volume weighted average trading price of Parent Common Stock on NASDAQ (or unvested, which has been granted under the Deferred Compensation Plan and which such other stock exchange that Parent Common Stock is outstanding immediately then traded) prior to the Merger Effective TimeFinal Payment Date, whether in trust or notand following such issuance of Parent Common Stock, the Excess Cash Stockholders shall be treated deemed to have received the Cash Merger Consideration to which they were entitled in full.” Effective as follows: (A) such Company Stock-Based Award of the execution hereof, the Company, Parent, and the Excess Cash Stockholders agree that the information set forth in Annex A hereto shall be exchanged at the Merger Effective Time for an amount in cash equal added as Exhibit H to the Merger Consideration in respect of each Company Common Share underlying a particular Company Stock-Based Award, (B) such cash amounts will be deposited in the trust related to the Deferred Compensation Plan and (C) and the vesting and distribution of such cash amounts and any subsequent earnings thereon will be in accordance with the terms of such Deferred Compensation Plan and upon which the related Company Stock-Based Award was granted and the elections of participants in the Deferred Compensation Plan.Agreement:

Amendments to the Merger Agreement. 1. The last sentence of the first paragraph of Section 2.012.4 of the Merger Agreement is hereby deleted in its entirety and replaced with the following: “Notwithstanding the foregoing, the number of shares acquirable pursuant to, and the exercise price of, the Company Warrants issued in connection with the Bridge Financing and the Second Bridge Financing (the “Bridge Warrants”) shall not be adjusted in connection with the Merger, and each such Bridge Warrant shall be automatically converted into a warrant to purchase an identical number of shares of Pharmaceuticals Common Stock. For avoidance of doubt, any Company Warrant issued after the date hereof as consideration or partial consideration for an amendment to or waiver under any promissory note issued pursuant to the Bridge Financing or Second Bridge Financing shall be deemed to be a Bridge Warrant and issued “in connection with” the Bridge Financing or Second Bridge Financing (as applicable).” 2. Section 4.01(f2.5 of the Merger Agreement is hereby deleted in its entirety and replaced with the following: “At the Effective Time, Pharmaceuticals shall assume the due and punctual performance of all of the terms and conditions of each outstanding convertible promissory note issued in connection with the Bridge Financing and the Second Bridge Financing (the “Bridge Notes”) and each such Bridge Note shall, unless the conversion rights thereunder have previously expired, become convertible into the number of New Securities (as defined in the applicable Bridge Note) of Pharmaceuticals and at such Conversion Price (as defined in the applicable Bridge Note) as set forth therein. 3. Section 3.5(b) of the Merger Agreement is hereby amended and superseded in all respects by the provisions of this First Amendment. As amended and restated, Section 4.01(f) reads deleted in its entirety: entirety and replaced with the following: “Except for the notes and warrants to be issued in connection with the Bridge Financing and the Second Bridge Financing, and except as set forth in Section 3.5(b) of the Company Disclosure Letter, there are no existing options, rights, subscriptions, warrants, unsatisfied preemptive rights, calls, commitments or agreements relating to (i) At the Merger Effective Timeauthorized and unissued capital stock of the Company, except as otherwise agreed by Parent and the holder of Company Stock-Based Awards (as defined below) with respect to such holder’s Company Stock-Based Awards, each right of any kind, contingent or accrued, to receive Company Common Shares or benefits measured in whole or in part by the value of a number of Company Common Shares granted under the Incentive Plans or otherwise (including performance shares, restricted stock, restricted stock units, phantom units, deferred stock units and dividend equivalents) other than Company Stock Options and Company Restricted Shares (each, other than Company Restricted Shares and Company Stock Options, a “Company Stock-Based Award”), except for any Company Stock-Based Award that has been granted under the Accredited Home Lenders Holding Co. Deferred Compensation Plan (the “Deferred Compensation Plan”), whether vested or unvested, which is outstanding immediately prior to the Merger Effective Time, shall become fully vested and free of any forfeiture or holding restrictions or performance or other restrictions, shall cease to represent a right or award with respect to Company Common Shares, and shall entitle the holder thereof to receive, at the Merger Effective Time, an amount in cash equal to the Merger Consideration in respect of each Company Common Share underlying a particular Company Stock-Based Award less such amounts as are required to be withheld or deducted under the Code or any provision of U.S. state or local tax law with respect to the making of such payment. (ii) At any securities or obligations convertible into or exchangeable for, or giving any Person any right to subscribe for or acquire from the Company, any shares of capital stock of the Company and no such convertible or exchangeable securities or obligations are outstanding.” 4. Section 3.22(d) of the Merger Effective TimeAgreement is hereby deleted in its entirety and replaced with the following: “Borrowed or agreed to borrow any funds; incurred or agreed to incur or become subject to any debts, each liabilities or obligations of any kind whatsoever (other than (i) in connection with the Bridge Financing and the Second Bridge Financing, (ii) in conjunction with the negotiation and execution of this Agreement, (iii) legal, accounting, advisory and board of director fees and expenses, (iv) obligations incurred in the ordinary course of business or (v) as set forth in Section 3.22(d) of the Company Stock-Based AwardDisclosure Letter); subjected or agreed to subject any of the assets or properties of the Company to any lien, whether vested security interest, charge, interest or unvested, which has been granted under other encumbrance or suffered such to be imposed; or guaranteed or agreed to guarantee the Deferred Compensation Plan and which debts or obligations of others.” 5. The following paragraph is outstanding immediately prior to added as a new Section 6(o) of the Merger Effective Time, whether in trust or not, shall be treated as follows: (A) such Company Stock-Based Award shall be exchanged at the Merger Effective Time for an amount in cash equal to the Merger Consideration in respect of each Company Common Share underlying a particular Company Stock-Based Award, (B) such cash amounts will be deposited in the trust related to the Deferred Compensation Plan and (C) and the vesting and distribution of such cash amounts and any subsequent earnings thereon will be in accordance with the terms of such Deferred Compensation Plan and upon which the related Company Stock-Based Award was granted and the elections of participants in the Deferred Compensation Plan.Agreement: