Exhibit 10.14

 

Restricted Stock Unit No.________

 

RUTHIGEN, INC.

 

Restricted Stock Unit Award Grant Notice for Employees, Directors and
Consultants

Restricted Stock Unit Award Grant under the Company’s

2013 Employee, Director and Consultant Equity Incentive Plan

 

1.   Name and Address of Participant:                                   2.  
Date of Grant of  Restricted Stock Unit Award:   May 11, 2014           3.  
Maximum Number of Shares underlying Restricted Stock Unit Award:    

 

4. Vesting of Award:  This Restricted Stock Unit Award shall vest in equal
one-third installments (provided that the number of shares vesting on each date
shall be rounded down to the nearest whole number, whilst the number of shares
vesting on the final vesting date shall be the remaining unvested balance of the
Shares) as follows provided the Participant is an Employee, director or
Consultant of the Company or of an Affiliate on the applicable vesting date:

 

1/3 of the shares on the date of certification by the Compensation Committee of
enrollment of the first patient in the first pivotal clinical trial for
Ruthigen’s “lead drug candidate” (as such is described in the Ruthigen S-1
Registration Statement filed with the Securities and Exchange Commission in
2013), provided that such enrollment occurs prior to May 11, 2017.

 

1/3 of the shares on the date of certification by the Compensation Committee of
enrollment of the first patient in the second pivotal clinical trial for
Ruthigen’s “lead drug candidate” (as such is described in the Ruthigen S-1
Registration Statement filed with the Securities and Exchange Commission in
2013), provided that such enrollment occurs prior to May 11, 2018.

 

1/3 of the shares on the date of certification by the Compensation Committee of
completion of the clinical study report containing the results of the second
pivotal clinical trial for Ruthigen’s “lead drug candidate” (as such is
described in the Ruthigen S-1 Registration Statement filed with the Securities
and Exchange Commission in 2013), provided that such event occurs prior to May
11, 2019.

 

[Notwithstanding the foregoing, 100% of the Maximum Number of Shares shall vest
in the event of a Change of Control pursuant to Section 2(c).]1/

 

 

1/      For Mr. Alimi, Mr. Harish, Ms. Douglas, Mr. French and Mr. Conley only.

 

 

 

 

The Company and the Participant acknowledge receipt of this Restricted Stock
Unit Award Grant Notice and agree to the terms of the Restricted Stock Unit
Agreement attached hereto and incorporated by reference herein, the Company’s
2013 Employee, Director and Consultant Equity Incentive Plan and the terms of
this Restricted Stock Unit Award as set forth above.

 

  RUTHIGEN, INC.         By:     Name:     Title:  

 

      Participant

 

2

 

 

RUTHIGEN, INC.

 

RESTRICTED STOCK UNIT AGREEMENT -

INCORPORATED TERMS AND CONDITIONS

 

AGREEMENT made as of the date of grant set forth in the Restricted Stock Unit
Award Grant Notice between Ruthigen, Inc. (the “Company”), a Delaware
corporation, and the individual whose name appears on the Restricted Stock Unit
Award Grant Notice (the “Participant”).

 

WHEREAS, the Company has adopted the Ruthigen, Inc. 2013 Employee, Director and
Consultant Equity Incentive Plan (the “Plan”), to promote the interests of the
Company by providing an incentive for Employees, directors and Consultants of
the Company and its Affiliates;

 

WHEREAS, pursuant to the provisions of the Plan, the Company desires to grant to
the Participant restricted stock units (“RSUs”) related to the Company’s common
stock, par value $0.0001 per share (“Common Stock”), in accordance with the
provisions of the Plan, all on the terms and conditions hereinafter set forth;
and

 

WHEREAS, the Company and the Participant understand and agree that any terms
used and not defined herein have the meanings ascribed to such terms in the
Plan.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

 

1.          Grant of Award. The Company hereby grants to the Participant the
number of RSUs set forth in the Restricted Stock Unit Award Grant Notice (the
“Award”) which represents a contingent entitlement of the Participant to receive
shares of Common Stock, on the terms and conditions and subject to all the
limitations set forth herein and in the Plan, which is incorporated herein by
reference. The Participant acknowledges receipt of a copy of the Plan.

 

2.          Vesting of Award.

 

(a)          Subject to the terms and conditions set forth in this Agreement and
the Plan, the Award granted hereby shall vest as set forth in the Restricted
Stock Unit Award Grant Notice and is subject to the other terms and conditions
of this Agreement and the Plan. On each vesting date set forth in the Restricted
Stock Unit Award Grant Notice, the Participant shall be entitled to receive such
number of shares of Common Stock equivalent to the number of RSUs set forth
opposite such vesting date provided that, on such vesting date, the Participant
is a director, Employee or Consultant of the Company or an Affiliate. Such
shares of Common Stock shall thereafter be delivered by the Company to the
Participant within five days of the applicable vesting date and in accordance
with this Agreement and the Plan. The purchase price is $0.0001 per share
payable if and when shares of Common Stock are issued by the Company, which
payment will be made by the Company on behalf of the Participant as compensation
for the Participant’s prior service to the Company and which amount will be
reported as income on the Participant’s W-2 (or other applicable form) in the
year of payment.

 

(b)          Except as otherwise set forth in this Agreement, if the Participant
ceases to be, for any reason, a director, Employee or Consultant of the Company
or an Affiliate (the “Termination”) prior to a vesting date set forth in the
Restricted Stock Unit Award Grant Notice, then as of the date on which such
relationship is terminated with the Participant, all unvested RSUs shall
immediately be forfeited to the Company and this Agreement shall terminate and
be of no further force or effect.

 

[(c)          Change of Control2/. Notwithstanding the foregoing, in the event
of a Change of Control (as defined below), then, immediately prior to the Change
of Control, all of the RSUs subject to this Award that are then unvested shall
be deemed vested as of immediately prior to such Change of Control and the
Participant shall receive upon such Change of Control such number of shares of
Common Stock equivalent to the number of RSUs subject to this Award.

 

 

2/      For Mr. Alimi, Mr. Harish, Ms. Douglas, Mr. French and Mr. Conley only.

 

 

 

 

Change of Control means the occurrence of any of the following events:

 

(i)a sale, lease or other disposition of all or substantially all of the assets
of the Company and its subsidiaries, taken as a whole;

 

(ii)any consolidation or merger of the Company with or into any other
corporation or other person, or any other corporate reorganization or
transaction (including the acquisition of capital stock of the Company), whether
or not the Company is a party thereto, in which the stockholders of the Company
immediately prior to such consolidation, merger, reorganization or transaction,
own capital stock and either:

 

a.represent directly, or indirectly through one or more entities, less than
fifty percent (50%) of the economic interests in or voting power of the Company
or other surviving entity immediately after such consolidation, merger,
reorganization or transaction, or

 

b.do not directly, or indirectly through one or more entities, have the power to
elect a majority of the entire board of directors of the Company or other
surviving entity immediately after such consolidation, merger, reorganization or
transaction; or

 

(iii)any stock sale or other transaction or series of related transactions,
whether or not the Company is a party thereto, after giving effect to which in
excess of fifty percent (50%) of the Company’s voting power is owned directly,
or indirectly though one or more entities, by any person and its “affiliates” or
“associates” (as such terms are defined in the rules adopted by the Securities
and Exchange Commission under the Securities Exchange Act of 1934, as amended).

 

For purposes of the definition of “Change of Control”, the following definitions
shall be applicable:

 

(i)The term “person” shall mean any individual, corporation or other entity and
any group as such term is used in Section 13(d) (3) or 14(d) (2) of the Exchange
Act.

 

(ii)Any person shall be deemed to be the beneficial owner of any shares of
capital stock of the Company:

 

a.which that person owns directly whether or not of record, or

 

b.which that person has the right to acquire pursuant to any agreement or
understanding or upon exercise of conversion rights, warrants, or options, or
otherwise, or

 

c.which are beneficially owned, directly or indirectly (including shares deemed
owned through application of clause (B) above, by an “affiliate” or “associate”
(as defined in the rules of the Securities and Exchange Commission under the
Securities Act of 1933, as amended) of that person, or

 

2

 

 

d.which are beneficially owned, directly or indirectly (including shares deemed
owned through application of clause (B) above), by any other person with which
that person or his “affiliate” or “associate” (defined as aforesaid) has any
agreement, arrangement, or understanding for the purpose of acquiring, holding,
voting or disposing of capital stock of the Company.

 

The outstanding shares of capital stock of the Company shall include shares
deemed owned through application of clause (ii) (b), (c), and (d) above, but
shall not include any other shares which may be issuable pursuant to any
agreement or upon exercise of conversion rights, warrants or options, or
otherwise, but which are not actually outstanding “Change of Control” shall be
interpreted, if applicable, in a manner, and limited to the extent necessary, so
that it will not cause adverse tax consequences under Section 409A.]

 

3.          Prohibitions on Transfer and Sale. This Award (including any
additional RSUs received by the Participant as a result of stock dividends,
stock splits or any other similar transaction affecting the Company's securities
without receipt of consideration) shall not be transferable by the Participant
otherwise than (i) by will or by the laws of descent and distribution, or (ii)
pursuant to a qualified domestic relations order as defined by the Internal
Revenue Code or Title I of the Employee Retirement Income Security Act or the
rules thereunder. Except as provided in the previous sentence, the shares of
Common Stock to be issued pursuant to this Agreement shall be issued, during the
Participant's lifetime, only to the Participant (or, in the event of legal
incapacity or incompetence, to the Participant's guardian or representative).
This Award shall not be assigned, pledged or hypothecated in any way (whether by
operation of law or otherwise) and shall not be subject to execution, attachment
or similar process. Any attempted transfer, assignment, pledge, hypothecation or
other disposition of this Award or of any rights granted hereunder contrary to
the provisions of this Section 3, or the levy of any attachment or similar
process upon this Award shall be null and void.

 

4.          Adjustments. The Plan contains provisions covering the treatment of
RSUs and shares of Common Stock in a number of contingencies such as stock
splits. Provisions in the Plan for adjustment with respect to this Award and the
related provisions with respect to successors to the business of the Company are
hereby made applicable hereunder and are incorporated herein by reference.

 

5.          Securities Law Compliance. The Participant specifically acknowledges
and agrees that any sales of shares of Common Stock shall be made in accordance
with the requirements of the Securities Act of 1933, as amended. The Company
currently has an effective registration statement on file with the Securities
and Exchange Commission with respect to the Common Stock to be granted
hereunder. The Company intends to maintain this registration statement but has
no obligation to do so. If the registration statement ceases to be effective for
any reason or there is a restriction under foreign law, a Participant will not
be able to transfer or sell any of the shares of Common Stock issued to the
Participant pursuant to this Agreement unless exemptions from registration or
filings under applicable securities laws are available. Furthermore, despite
registration, applicable securities laws may restrict the ability of the
Participant to resell his or her Common Stock, including due to the
Participant’s affiliation with the Company. The Company shall not be obligated
to either issue the Common Stock or permit the resale of any shares of Common
Stock if such issuance or resale would violate any applicable securities law,
rule or regulation.

 

6.          Rights as a Stockholder. The Participant shall have no right as a
stockholder, including voting and dividend rights, with respect to the RSUs
subject to this Agreement.

 

7.          Incorporation of the Plan. The Participant specifically understands
and agrees that the RSUs and the shares of Common Stock to be issued under the
Plan will be issued to the Participant pursuant to the Plan, a copy of which
Plan the Participant acknowledges he or she has read and understands and by
which Plan he or she agrees to be bound. The provisions of the Plan are
incorporated herein by reference.

 

3

 

 

8.          Tax Liability of the Participant and Payment of Taxes. The
Participant acknowledges and agrees that any income or other taxes due from the
Participant with respect to this Award or the shares of Common Stock to be
issued pursuant to this Agreement or otherwise sold shall be the Participant’s
responsibility. Without limiting the foregoing, the Participant agrees that if
under applicable law the Participant will owe taxes at each vesting date on the
portion of the Award then vested the Company shall be entitled to immediate
payment from the Participant of the amount of any tax required to be withheld by
the Company. Any taxes due shall be paid, at the option of the Company as
follows:

 

(a)          through reducing the number of shares of Common Stock entitled to
be issued to the Participant on the applicable vesting date in an amount equal
to the amount of minimum withholding tax due and payable by the Company.
Fractional shares will not be retained to satisfy any portion of the withholding
tax. Accordingly, the Participant agrees that in the event that the amount of
withholding tax owed would result in a fraction of a share being owed, that
amount will be satisfied by withholding the fractional amount from the
Participant’s paycheck;

 

(b)          requiring the Participant to deposit with the Company an amount of
cash equal to the amount determined by the Company to be required with respect
to the statutory minimum of the Participant’s estimated total federal, state and
local tax obligations or otherwise withholding from the Participant’s paycheck
an amount equal to the withholding tax due and payable; or

 

(c)          if the Company believes that the sale of shares can be made in
compliance with applicable securities laws, authorizing, at a time when the
Participant is not in possession of material nonpublic information, the sale by
the Participant on the applicable vesting date of such number of shares of
Common Stock as the Company instructs a registered broker to sell to satisfy the
Company’s withholding obligation, after deduction of the broker’s commission,
and the broker shall be required to remit to the Company the cash necessary in
order for the Company to satisfy its withholding obligation. To the extent the
proceeds of such sale exceed the Company’s tax withholding obligation the
Company agrees to pay such excess cash to the Participant as soon as
practicable. In addition, if such sale is not sufficient to pay the Company’s
tax withholding obligation the Participant agrees to pay to the Company as soon
as practicable, including through additional payroll withholding, the amount of
any tax withholding obligation that is not satisfied by the sale of shares of
Common Stock. The Participant agrees to hold the Company and the broker harmless
from all costs, damages or expenses relating to any such sale. The Participant
acknowledges that the Company and the broker are under no obligation to arrange
for such sale at any particular price. In connection with such sale of shares of
Common Stock, the Participant shall execute any such documents requested by the
broker in order to effectuate the sale of shares of Common Stock and payment of
the withholding obligation to the Company. The Participant acknowledges that
this paragraph is intended to comply with Section 10b5-1(c)(1(i)(B) under the
Exchange Act.

 

The Company shall not deliver any shares of Common Stock to the Participant
until it is satisfied that all required withholdings have been made.

 

9.            Participant Acknowledgements and Authorizations.

 

The Participant acknowledges the following:

 

(a)          The Company is not by the Plan or this Award obligated to continue
the Participant as an Employee, director or Consultant of the Company or of an
Affiliate.

 

(b)          The Plan is discretionary in nature and may be suspended or
terminated by the Company at any time.

 

(c)          The grant of this Award is considered a one-time benefit and does
not create a contractual or other right to receive any other award under the
Plan, benefits in lieu of awards or any other benefits in the future.

 

4

 

 

(d)          The Plan is a voluntary program of the Company and future awards,
if any, will be at the sole discretion of the Company, including, but not
limited to, the timing of any grant, the amount of any award, vesting provisions
and the purchase price, if any.

 

(e)          The value of this Award is an extraordinary item of compensation
outside of the scope of any employment or service. As such, the Award is not
part of normal or expected compensation for purposes of calculating any
severance, resignation, redundancy, end of service payments, bonuses,
long-service awards, pension or retirement benefits or similar payments. The
future value of the shares of Common Stock is unknown and cannot be predicted
with certainty.

 

(f)          The Participant (i) authorizes the Company and its Affiliates or,
if the Participant is not employed by the Company or an Affiliate, his or her
employer, to furnish the Company and its Affiliates (and any agent administering
the Plan or providing recordkeeping services) with such information and data as
it shall request in order to facilitate the grant of the Award and the
administration of the Plan, (ii) waives any data privacy rights he or she may
have with respect to such information or the sharing of such information, and
(iii) authorizes the Company and its Affiliates to store and transmit such
information in electronic form.

 

10.          Notices. Any notices required or permitted by the terms of this
Agreement or the Plan shall be given by recognized courier service, facsimile,
registered or certified mail, return receipt requested, addressed as follows:

 

If to the Company:

 

Ruthigen, Inc.

2455 Bennett Valley Rd., Suite C116

Santa Rosa, CA 95404

Attention: Chief Financial Officer

 

If to the Participant at the address set forth on the Restricted Stock Unit
Award Grant Notice or to such other address or addresses of which notice in the
same manner has previously been given. Any such notice shall be deemed to have
been given on the earliest of receipt, one business day following delivery by
the sender to a recognized courier service, or three business days following
mailing by registered or certified mail.

 

11.          Assignment and Successors.

 

(a)          This Agreement is personal to the Participant and without the prior
written consent of the Company shall not be assignable by the Participant
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Participant’s legal
representatives.

 

(b)          This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.

 

12.         Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the Delaware, without giving effect to the conflict
of law principles thereof. For the purpose of litigating any dispute that arises
under this Agreement, whether at law or in equity, the parties hereby consent to
exclusive jurisdiction in the state of California and agree that such litigation
shall be conducted in the state courts of California or the federal courts of
the United States for the Northern District of California.

 

13.         Severability. If any provision of this Agreement is held to be
invalid or unenforceable by a court of competent jurisdiction, then such
provision or provisions shall be modified to the extent necessary to make such
provision valid and enforceable, and to the extent that this is impossible, then
such provision shall be deemed to be excised from this Agreement, and the
validity, legality and enforceability of the rest of this Agreement shall not be
affected thereby.

 

5

 

 

14.         Entire Agreement. This Agreement, together with the Plan,
constitutes the entire agreement and understanding between the parties hereto
with respect to the subject matter hereof and supersedes all prior oral or
written agreements and understandings relating to the subject matter hereof. No
statement, representation, warranty, covenant or agreement not expressly set
forth in this Agreement shall affect or be used to interpret, change or restrict
the express terms and provisions of this Agreement provided, however, in any
event, this Agreement shall be subject to and governed by the Plan.

 

15.         Modifications and Amendments; Waivers and Consents. The terms and
provisions of this Agreement may be modified or amended as provided in the Plan.
Except as provided in the Plan, the terms and provisions of this Agreement may
be waived, or consent for the departure therefrom granted, only by written
document executed by the party entitled to the benefits of such terms or
provisions. No such waiver or consent shall be deemed to be or shall constitute
a waiver or consent with respect to any other terms or provisions of this
Agreement, whether or not similar. Each such waiver or consent shall be
effective only in the specific instance and for the purpose for which it was
given, and shall not constitute a continuing waiver or consent.

 

16.         Section 409A. The Award of RSUs evidenced by this Agreement is
intended to be exempt from the nonqualified deferred compensation rules of
Section 409A of the Code as a “short term deferral” (as that term is used in the
final regulations and other guidance issued under Section 409A of the Code,
including Treasury Regulation Section 1.409A-1(b)(4)(i)), and shall be construed
accordingly.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

6