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Option Cancellation
Acknowledgement
As you are aware,
Wellco Enterprises, Inc. (the “Company” or
“we”) has entered into a definitive agreement (the
“Merger Agreement”) to be acquired (the
“Transaction”) by Wasatch Boot Holdings, Inc.
(“Holdings”). The Transaction will be consummated
through a merger between the Company and a subsidiary of
Holdings.
As you know, you
were granted an option to purchase common stock of the Company
(each, a “Plan Option”) under the terms of one or more
of the following (collectively, the
“Plans”):
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1996 Stock Option Plan for Key
Employees of Wellco Enterprises, Inc.;
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1997 Stock Option Plan for Key
Employees of Wellco Enterprises, Inc.;
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1997 Stock Option Plan for
Non-Employee Directors of Wellco Enterprises, Inc.;
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1999 Stock Option Plan for Key
Employees of Wellco Enterprises, Inc.; and
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1999 Stock Option Plan for
Non-Employee Directors of Wellco Enterprises, Inc..
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Exhibit A
to this Option Cancellation Agreement sets forth for each
outstanding Plan Option and any rights to aquire securities or any
equity interest in Wellco Enterprises, Inc., (together, the
“Options”), the grant date, exercise price and number
of shares of common stock of the Company (“Common
Stock”) that may be purchased under the Options.
Holding’s
acquisition terms provide for the cash-out of all Options
outstanding on the date the Transaction is consummated (such date,
the “Effective Time”) for a per share amount (the
“Merger Consideration”) of $14.00 less the applicable
exercise price(s) per share for the Options and any required tax
withholding amounts. The Compensation Committee of the Board of
Directors of the Company, as
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