Document:

Exhibit 10.1

 

Execution Version

 

SEPARATION AND RELEASE AGREEMENT

 

This Separation and Release Agreement (the “Agreement”) is by and between Kunwar Shailubhai (“Executive”) and Synergy Pharmaceuticals Inc., a Delaware corporation (the “Company”).

 

WHEREAS, Executive’s status as an employee of the Company will end effective on May 23, 2017 (the “Termination Date”); and

 

WHEREAS, Executive and the Company desire to assure a smooth and effective transition of Executive’s duties and to wind-up their employment relationship amicably; and

 

WHEREAS, the payments and benefits being made available to Executive pursuant to this Agreement are intended to satisfy all outstanding obligations under that certain Third Amended and Restated Executive Employment Agreement dated January 7, 2015, between Executive and the Company, as amended on January 18, 2016 and November 30, 2016 (the “Employment Agreement”).

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, Executive and the Company, intending to be legally bound, hereby agree as follows:

 

1.             Termination Date.  Executive acknowledges that his status as an employee and officer of the Company will end on the Termination Date.  Executive understands that this Agreement is only effective if it is executed on or before May 24, 2017 (which is at least forty-five (45) days from the date Executive received this Agreement). Executive has seven (7) days after Executive signs this Agreement to revoke it.  This Agreement will become effective on the eighth (8th) day after Executive signed this Agreement, so long as it has not been revoked by Executive before that date (the “Effective Date”).

 

2.             Separation Payments and Benefits.  Without admission of any liability, fact or claim, the Company hereby agrees, subject to Executive’s timely execution and non-revocation hereof and Executive’s compliance with Executive’s obligations pursuant to this Agreement and the Surviving Provisions, to provide Executive the severance payments and benefits set forth below:

 

(a)           Severance Payment.  The Company shall pay Executive a lump sum cash payment of $596,250 as follows:  (x) $198,750 shall be paid in a lump sum cash payment on the first payroll date after July 1, 2017 and (y) $397,500 (the “Severance Payment”) shall be paid in a lump sum cash payment on the earlier of (i) November 25, 2017 and (ii) the date of Executive’s death.

 

(b)           Benefits Coverage; Indemnification.  If Executive is enrolled in the Company’s group medical, vision and/or dental plans on the Termination Date, Executive

 

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may elect to continue Executive’s participation and that of Executive’s eligible dependents in those plans for a period of time under COBRA.  Executive may make such an election whether or not Executive accepts this Agreement.  However, if Executive accepts this Agreement and Executive timely elects to continue Executive’s participation and/or that of Executive’s eligible dependents in such plans, the Company will pay the full premium cost of Executive’s and his dependents’ COBRA continuation coverage until the earlier of the conclusion of the twelve (12) month period following the Termination Date or the date that Executive is no longer entitled to coverage under COBRA. If the Company’s contributions end before Executive’s entitlement to coverage under COBRA concludes, Executive may continue such coverage by paying the full premium cost himself.  Notwithstanding the foregoing, in the event that the Company’s payment of the COBRA premium contributions as described under this Section 2(b), would subject the Company to any tax or penalty under the Patient Protection and Affordable Care Act (as amended from time to time, the “ACA”) or Section 105(h) of the Internal Revenue Code of 1986, as amended (the “Code”), or applicable regulations or guidance issued under the ACA or Code Section 105(h), Executive and the Company agree to work together in good faith to restructure such benefit. The Company further agrees to continue to provide D&O coverage for the Executive under the Company’s D&O policy (with coverage no less favorable than the coverage applicable to Executive immediately prior to the Termination Date) for a period of six (6) years following the Termination Date.

 

(c)           Equity Awards.  Any unvested stock options granted to Executive by the Company will accelerate and become fully vested and exercisable as of the Termination Date and each stock option granted to Executive by the Company (including, without limitation, such stock options that receive accelerated vesting under this Section 2(c)) shall remain exercisable until the ten (10) year anniversary of the date of grant thereof.

 

(d)           Taxes; Tax Payments.

 

i.                                          Executive understands and agrees that all payments under this Agreement will be subject to appropriate tax withholding and other deductions, as and to the extent required by law. The Company shall make a payment to Executive of $22,500 within 10 days after the Termination Date and three payments of $7,500 each for each of the three months ended March 31, 2018 (with such payments to be made within 10 days after the end of the applicable month).

 

ii.                                       If the payment of the Total Payments (as defined below) will be subject to the tax (the “Excise Tax”) imposed by Section 4999 of the Code, the Company shall pay the Executive on or before the tenth (10th) day following the date of the payment giving rise to the Excise Tax, an additional amount (the “Gross-Up Payment”) such that the net amount retained by the Executive of the Gross-Up Payment, after deduction of any federal, state and local income and employment taxes (including, without limitation, the Excise Tax) on the Gross-Up Payment equals the total

 

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Excise Tax imposed on the Total Payments. For purposes of determining whether any of the payments will be subject to the Excise Tax and the amount of such Excise Tax, (A) any payments or benefits received or to be received by the Executive in connection with a Change in Control (as defined in the Employment Agreement) or the Executive’s termination of employment, whether payable pursuant to this Agreement or any other plan, arrangement or agreement with the Company, its successors, any person whose actions result in a Change in Control or any corporation affiliated (or which, as a result of the completion of the transaction causing such a Change in Control, will become affiliated) with the Company within the meaning of Section 1504 of the Code (such severance and Change in Control payments and benefits, the “Total Payments”) shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “excess parachute payments” within the meaning of Code Section 280G(b)(1) shall be treated as subject to the Excise Tax, unless and then only to the extent, in the opinion of tax counsel selected by the Company’s independent auditors and acceptable to the Executive (the “Calculation Firm”), the Total Payments (in whole or in part) do not constitute parachute payments, or such excess parachute payments (in whole or in part) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code either in their entirety or in excess of the base amount within the meaning of Section 280G(b)(3) of the Code, or are otherwise not subject to the Excise Tax and (B) the amount of the Total Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser of (I) the total amount of the Total Payments or (II) the amount of excess parachute payments and benefits that shall be determined by the Calculation Firm in accordance with the principles of Section 280G(d)(3) and (4) of the Code. For purposes of determining the amount of the Gross-Up Payment, the Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of the Executive’s residence at the time the Gross-Up Payment is made, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. In the event the Excise Tax is subsequently determined to be less than the amount taken into account hereunder, the Executive shall repay to the Company within 30 days after the time the amount of such reduction in Excise Tax is finally determined the portion of the Gross-Up Payment that can be repaid such that the Executive remains whole on an after-tax basis from the Excise Tax following such repayment (taking into account any reduction in income or excise taxes to the Executive from such repayment) plus interest on the amount of such repayment at the Federal short-term rate provided in Section 1274(d)(1)(C)(i) of the Code. In the event the Excise Tax is determined to exceed the amount taken into account hereunder (including

 

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by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up Payment), the Company shall make an additional gross-up payment (consistent with how the Gross-Up Payment is determined) in respect of such excess (plus any interest payable with respect to such excess) within 30 days after the time that the amount of such excess is finally determined.  For the avoidance of doubt, the Gross-Up Payment shall be paid in addition to the Total Payments, and in no event shall the Total Payments be reduced.  In all events, any gross-up payment (including the Gross-Up Payment) shall be paid by no later than the last day of the year immediately following the year in which Executive pays the relevant tax.

 

iii.                                    In the event that Executive incurs any additional tax, interest or penalties imposed by Code Section 409A (the “Section 409A Tax”) as a result of a subsequent audit by the Internal Revenue Service or self-reporting by the Company, then the Company shall pay to Executive an additional amount (the “Section 409A Gross-Up Payment”) such that Executive is placed in the same after-tax financial position as if no such violation of Code Section 409A had occurred.  Any Section 409A Gross-Up Payment shall be made within ten (10) days after the date on which Executive pays the Section 409A Tax. Notwithstanding the foregoing, in no event will the Company be liable for any Section 409A Tax with respect to the payment of any Realization Bonus or any failure of this Agreement to comply with Code Section 409A.

 

(e)           Realization Bonus.

 

i.                                          In the event that within 30 years from the Effective Date,

 

A.                                    (i) The Company engages in a merger transaction, or the stockholders of the Company sell their shares of the Company’s stock pursuant to a tender offer or similar transaction, in either case, as a result of which the stockholders of the Company existing immediately before the consummation of such merger or sale beneficially own less than 20% of the voting power of the stock of the Company or the ultimate parent of the surviving entity immediately after the consummation of the merger or sale, where the Enterprise Value equals or exceeds a minimum value of $400 million (and subsection B. doesn’t apply) or (ii) a sale of all or substantially all of the assets of the Company and its subsidiaries (determined on a consolidated basis) occurs, where the Enterprise Value equals or exceeds a minimum value of $400 million (and subsection B. doesn’t apply), then in either case of clauses (i) and (ii), the Executive shall accrue a bonus in an amount determined by multiplying the Enterprise Value by 1.0%.

 

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B.                                    (i) The Company engages in a merger transaction, or the stockholders of the Company sell their shares of the Company’s stock pursuant to a tender offer or similar transaction, in either case, as a result of which the stockholders of the Company existing immediately before the consummation of such merger or sale beneficially own less than 20% of the voting power of the stock of the Company or the ultimate parent of the surviving entity immediately after the consummation of the merger or sale, where the Enterprise Value equals or exceeds a minimum value of $1 billion or (ii) a sale of all or substantially all of the assets of the Company and its subsidiaries (determined on a consolidated basis) occurs, where the Enterprise Value equals or exceeds a minimum value of $1 billion, then in either case of clauses (i) and (ii), the Executive shall accrue a bonus in an amount determined by multiplying the Enterprise Value by 1.17%.

 

C.                                    The Company engages in (i) a merger transaction, as a result of which the stockholders of the Company existing immediately before the consummation of such merger beneficially own 20% or more, but not more than 70%, of the voting power of the stock of the ultimate parent of the surviving entity immediately after the consummation of the merger, where the Enterprise Value of the Company (either at the effective date of the transaction or the first anniversary of the effective date of the transaction) equals or exceeds a minimum value of $250 million or (ii) a sale of all or substantially all of the assets of the Company and its subsidiaries (determined on a consolidated basis), where the Enterprise Value equals or exceeds a minimum value of $250 million (and neither subsection A. nor subsection B. applies), then in either case of clauses (i) and (ii), the Executive shall accrue a bonus in an amount determined by multiplying the Enterprise Value by 1.0%.

 

Notwithstanding the foregoing, such amounts shall be payable only if the transaction described in clause A, B or C above satisfies the requirements of Treasury Regulation 1.409A-3(i)(5)(v), (vi) or (vii).

 

ii.             The accrued bonuses shall be payable to Executive in the same form of the consideration received by the Company or by the Company’s stockholders (as applicable) in full contemporaneously at the closing of any transaction described in clause A, B or C above (subject to Section 2(e)(iii) below).

 

iii.            The “Enterprise Value” in the case of a transaction in which consideration is payable to the Company in respect of its assets or business, shall mean the total cash and non-cash (including, without limitation, the assumption of debt) consideration received by the Company or in the case of a transaction in which consideration is payable to the Company’s

 

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stockholders, the total cash and non-cash (including, without limitation, the assumption of debt) consideration payable to the Company’s stockholders. “Enterprise Value” shall also include, if applicable, any cash or non-cash consideration payable to the Company/its subsidiaries or to the Company’s stockholders on a contingent, earnout or deferred basis (but (A) for purposes of a transaction that doesn’t satisfy the requirements of Treasury Regulation 1.409A-3(i)(5)(v) or (vii), only to the extent that the payment thereof constitutes a “substantial risk of forfeiture” under Code Section 409A and the payments related thereto are made within the short-term deferral period under Code Section 409A and (B) for purposes of a transaction that satisfies the requirements of Treasury Regulation 1.409A-3(i)(5)(v) or (vii), such consideration shall be paid as and when received by the Company/its subsidiaries or the Company’s stockholders in such transaction (as applicable), provided that no consideration will be paid after the fifth anniversary of such transaction unless permitted by Code Section 409A)). To the extent that any consideration in a transaction is not received in cash upon the consummation of the transaction, the value of such non-cash consideration for purposes of calculating the Enterprise Value will be determined by the independent Board of Directors of the Company prior to the transaction in good faith in consultation with an independent investment bank or financial advisor retained by the Board of Directors of the Company in connection with the transaction. In the event that less than 100% of the stock or assets of the Company is purchased in the transaction, the Enterprise Value shall be extrapolated from the percentage of the Company’s capital stock or assets impacted in such transaction to determine if the applicable threshold was exceeded, but the Realization Bonus shall be calculated based on the actual consideration received by the Company or shareholders, as the case may be. This Section 2(e), however, shall not apply to any event resulting in a transaction in which neither the Company nor its stockholders receives consideration either upon, or in connection with, the occurrence or consummation of such transaction.  For purposes of Section 2(i)(e)(C), Enterprise Value at any time subsequent to the effective date of a transaction shall be computed by reference to the market capitalization of the combined entity (based on an average closing price of the combined entity’s common stock for a period of 20 consecutive trading days) multiplied by the quotient of the number of shares of common stock and common stock equivalents of the combined entity issued to the Company’s stockholders in the transaction divided by the total number of shares of the common stock and common stock equivalents of the combined entity outstanding on the effective date of the transaction, in each case determined on a fully diluted basis.

 

iv.                                   Any amount payable under this Section 2(e) is referred to herein as a “Realization Bonus.”

 

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(f)                                   Sole Separation Benefit.  Executive agrees that the payments and benefits provided by this Agreement are not required under the Company’s normal policies and procedures and are provided solely in connection with this Agreement. Executive further acknowledges and agrees that the payments and benefits referenced in this Agreement constitute adequate and valuable consideration, in and of themselves, for the promises contained in this Agreement.

 

(g)                                  Continued Obligations.  Executive acknowledges and agrees that Executive shall continue to be subject to, and abide by, Section 2 (Confidential Information) and Section 3 (Non-Competition; Non-Solicitation) of the Employment Agreement and the terms of the Nondisclosure, Noncompete, Nonsolicitation and Assignment of Inventions Agreement executed by Executive on January 6, 2014 and attached hereto as Exhibit A (such Nondisclosure, Noncompete, Nonsolicitation and Assignment of Inventions Agreement, together with Sections 2 and 3 of the Employment Agreement, the “Surviving Provisions”), which shall continue to apply and remain in full force and effect; provided, however, that in consideration of the Company’s agreement to Section 2(e) hereof, Executive acknowledges and agrees that Section 3 (Non-Competition; Non-Solicitation) of the Employment Agreement shall continue to apply for a period of two (2) years following the Termination Date. The Executive further acknowledges and agrees that in order to comply with the Surviving Provisions, from and after the Termination Date, Executive may not at any time nor in any venue proactively speak about, present or author any materials with respect to the Company or its products without the Company’s advance written consent, whether at medical, clinical, investor or analyst presentations or otherwise, except upon request and at the direction of the Company, other than (i) to his legal counsel or tax or financial advisors, (ii) as required by law or legal process, (iii) to the limited extent necessary to defend himself against any claims (x) brought by the Company or (y) in relation to his work for the Company, (iv) statements made by Executive regarding the Company and/or its products that do not breach  the Surviving Provisions or Section 6(b) hereof, or (v) statements made by Executive regarding (a) Executive’s former position, titles, achievements, duties or responsibilities with the Company or any of its subsidiaries, or (b) Executive’s role at the Company and/or role with respect to any Company products on which Executive worked, provided that (x) in the case of clauses (a) and (b), such statements do not breach any of the Surviving Provisions or Section 6(b) of this Agreement, and (y) in the case of clause (b), such statements contain only information about the Company or any of its products that is in the public domain or generally known within the industry. (the foregoing clauses (i) through and including (v), the “Exceptions”)). In addition, the Executive agrees that, if asked about the Company or its products by a third party having no involvement in Executive’s performance of his obligations under Section 6(c), Executive will state that he is not an employee of the Company and, unless permitted by one of the Exceptions (i) — (iii) or (v), will defer the question to the Company for response. If the Company believes that Executive has breached any provision of this Agreement or the Surviving Provisions, then it shall provide Executive with written notice of such alleged breach within 30 days after it has knowledge of the occurrence thereof and shall provide Executive with 30 days to cure such alleged breach (any breach so cured shall not be deemed a breach of this Agreement or any of the Surviving Provisions). If the Executive

 

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breaches this Agreement or any of the Surviving Provisions, and fails to cure said breach, the Company shall have no further obligation to provide any payments or benefits pursuant to this Agreement, including, without limitation, any Realization Bonus. The Company acknowledges and agrees that (x) the press release issued by Rasna Therapeutics, Inc. on April 20, 2017 regarding Executive’s appointment as Chief Executive Officer (including the contents thereof) (the “Press Release”) does not constitute a breach of this Agreement or the Surviving Provisions and (y) it is not aware of any breach by Executive of any of the Surviving Provisions or any provision of this Agreement.  The Company hereby covenants and agrees that it will not make any claim against Executive relating to the Press Release.

 

3.                                      Full Payment; Termination of Employment Agreement.  Other than as set forth in Section 2 above and Section 10 below, Executive shall not be entitled to any other payments including but not limited to bonuses, commissions, or other cash or non-cash awards, penalties, interest or attorneys’ fees, and Executive expressly represents that Executive has been compensated for all monies owed to Executive from Executive’s employment with the Company; provided, however, that to the extent unpaid as of the Effective Date, the Company shall pay the Compensation Payment (as defined in the Employment Agreement) to Executive as provided in Section 4.1 of the Employment Agreement. On the Termination Date all provisions of the Employment Agreement, other than the Surviving Provisions and Section 5 of the Employment Agreement, shall terminate and Executive shall have no further rights thereunder.

 

4.                                      General Release.  As a material inducement for the Company to enter into this Agreement, and in exchange for the performance of the Company’s obligations under this Agreement provided for herein, Executive knowingly and voluntarily waives and releases all rights and claims, known and unknown, which Executive may have against the Company or any of its respective subsidiaries, affiliates or successors, or any of their current or former officers, directors, managers, employees, agents, insurance carriers, auditors, accountants, attorneys or representatives (collectively, the “Releasees”), including any and all charges, complaints, claims, liabilities, obligations, promises, agreements, contracts, controversies, damages, actions, causes of action, suits, rights, demands, costs, losses, debts and expenses of any kind.  This includes, but is not limited to, any claim to any equity-based or similar type of award or incentive with respect to the Releasees, including any claim for benefits under any stock option or other equity-based incentive plan of the Releasees (or any related agreement, arrangement or understanding with any Releasee); any claim to accelerated vesting or post-termination or severance benefits or payments that are or may become payable under any plan, arrangement, policy and agreement between Executive and the Company, including, without limitation, the Employment Agreement, each stock option agreement entered into between Executive and the Company and any agreement or policy with the Company under which Executive benefits, and any claims for employment discrimination, harassment, wrongful termination, constructive termination, violation of public policy, breach of any express or implied contract, breach of any implied covenant, fraud, intentional or negligent misrepresentation, emotional distress, defamation, or any other claims, actual or potential, which in any way arise from or are related to Executive’s relationship with the Company, including, without limitation, relating to Executive’s compensation, the termination of the employment relationship, or any other conduct of the Company occurring prior to the execution of this Agreement.  This also includes a release of any claims under any federal, state or local laws or regulations, including, but not limited to Title VII

 

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of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000, et seq.; Americans with Disabilities Act, as amended, 42 U.S.C. § 12101 et seq.; the Rehabilitation Act of 1973, as amended, 29 U.S.C. § 701 et seq.; Age Discrimination in Employment Act, as amended, 29 U.S.C. § 621, et seq.; Civil Rights Act of 1866, and Civil Rights Act of 1991; 42 U.S.C. § 1981, et seq.; Equal Pay Act, as amended, 29 U.S.C. § 206(d); regulations of the Office of Federal Contract Compliance, 41 C.F.R. Section 60, et seq.; The Family and Medical Leave Act, as amended, 29 U.S.C. § 2601 et seq.; the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. § 201 et seq.; the Executive Retirement Income Security Act, as amended, 29 U.S.C. § 1001 et seq.; the Worker Adjustment and Retraining Notification Act, as amended, 29 U.S.C. § 2101 et seq.; the Federal False Claims Act, as amended, 31 U.S.C. §§ 3729 et seq.; the Dodd-Frank Wall Street Reform and Consumer Protection Act; Pennsylvania Human Relations Act, Pennsylvania Minimum Wage Act of 1968, Pennsylvania Wage Payment and Collection Law, Pennsylvania Whistleblower Law; and any other federal, state or local laws of similar effect.  Notwithstanding the generality of the foregoing, Executive does not release any claims which Executive may have to the following (collectively, the “Unreleased Claims”): (i) claims for unemployment compensation or any state disability insurance benefits pursuant to the terms of applicable state law, (ii) Executive’s right to continued participation in certain of the Company’s group benefit plans pursuant to the terms and conditions of COBRA, (iii) Executive’s right to any payments and benefits under this Agreement (including, without limitation, any of the payments and benefits set forth in Section 2), (iv) Executive’s right to vested benefits under the benefit plans of any Releasee, (v) Executive’s right to indemnification pursuant to Section 5 of the Employment Agreement and (vi) Executive’s right to bring to the attention of the Equal Employment Opportunity Commission claims of discrimination; provided, however, that Executive does release Executive’s right to secure any damages for alleged discriminatory treatment.  The matters that are the subject of the releases referred to in this Section 4 (and, for the avoidance of doubt, excluding any Unreleased Claims) shall be referred to collectively as the “Released Matters.”

 

5.                                      Acknowledgements Related to ADEA.  Executive understands and acknowledges that:

 

(a)                                 This Agreement constitutes a voluntary waiver of any and all rights and claims Executive has against the Releases, or any of them, as of the date Executive executes this Agreement, for claims arising under the Age Discrimination in Employment Act, 29 U.S.C. 621, et seq.

 

(b)                                 Executive has waived rights or claims pursuant to this Agreement and in exchange for consideration, the value of which exceeds payment or remuneration to which Executive was already entitled.

 

(c)                                  Executive is hereby advised to consult with an attorney of Executive’s choosing concerning this Agreement prior to executing it.

 

(d)                                 Executive has been afforded a period of forty-five (45) days to consider the terms of this Agreement and the information annexed hereto as Exhibit B, as required by the Older Workers Benefits Protection Act, and in the event Executive should decide to execute this Agreement in fewer than forty-five (45) days, Executive has done

 

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so with the express understanding that Executive has been given and declined the opportunity to consider this Agreement for a full forty-five (45) days, and waives the balance of the forty-five (45) day period.

 

(e)                                  Executive may revoke this Agreement at any time during the seven (7) days following the date of execution of this Agreement, and this Agreement shall not become effective or enforceable until such revocation period has expired.  Executive understands that if Executive does not sign this Agreement or Executive signs and subsequently revokes this Agreement before it becomes effective, Executive shall not be entitled to any of the payments or benefits provided in Section 2 of this Agreement.

 

6.                                      Transition; Non-Disparagement; Cooperation; Transfer of Company Property.  Executive further agrees that:

 

(a)                                 Transition.  Executive acknowledges and agrees that Executive shall collaborate with the Company in the development and issuance of any internal or external communications made by the Company addressing Executive’s separation pursuant to this Agreement.

 

(b)                                 Non-Disparagement. Executive agrees that Executive shall not at any time disparage or encourage or induce others to disparage the Company, any of its subsidiaries, or any of their respective past and present, officers, directors, employees, products or services (the “Company Parties”).  The Company agrees that it shall (i) instruct its present directors and officers not to disparage or encourage or induce others to disparage the Executive or his reputation (together, the “Executive Parties”) at any time during which they are employed by, or providing services to, the Company, and (ii) not cause or direct any of its past or present employees or independent contractors to disparage or encourage or induce others to disparage any of the Executive Parties.  For purposes of this Section 6(b), the term “disparage” includes, without limitation, comments or statements to the press, to the Company’s or any subsidiaries’ employees or to any individual or entity with whom the Executive, the Company or any subsidiary thereof has a business relationship (including, without limitation, any vendor, supplier, customer or distributor), or any public statement, that in each case is intended to, or can be reasonably expected to, damage any of the Company Parties or the Executive Parties, as applicable.  Notwithstanding the foregoing, nothing in this Section 6(b) shall prevent any person from making any truthful statement to the extent, but only to the extent (A) necessary with respect to any litigation, arbitration or mediation in the forum in which such litigation, arbitration or mediation properly takes place, or (B) required by law, legal process or by any court, arbitrator, mediator or administrative or legislative body (including any committee thereof) with apparent jurisdiction over such person.

 

(c)                                  Cooperation.  Commencing on the date hereof and continuing during the eighteen (18) month period after the Termination Date (the “Cooperation Period”), Executive agrees to (i) reasonably cooperate with the Company in its efforts to prosecute or defend itself against any claim, suit, demand or cause of action (not brought by the Company against Executive or by Executive against the Company) about which Executive has knowledge and (ii) provide the Company with advice and support relating

 

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to (1) the further development or formulation of Plecanatide and Dolcanatide, (2) the development of manuscripts respecting Plecanatide and Dolcanatide, (3) the Plecanatide and Dolcanatide I/P Estate; and (4)  the conduct of research performed at the Doylestown Lab for the Company. Notwithstanding the immediately preceding sentence, following the Termination Date, (a) the Company shall provide Executive with advance written notice of such required cooperation within a reasonable period of time prior to the date on which such cooperation will be required, (b) such cooperation shall not create a conflict with any of Executive’s obligations or duties to his then current employer, (c) such cooperation shall be provided at times and locations, and in a manner, that are mutually agreed between the Company and Executive, (d) Executive shall not be required to devote more than 15 hours per month in providing any such cooperation, (e) the Executive shall report to, and take direction from, only the Company’s Chief Executive Officer in providing the cooperation described in clause (ii) and (f) the Company shall reimburse Executive (in compliance with Code Section 409A) for all reasonable expenses incurred by him in complying with this Section 6(c), subject to appropriate itemization and substantiation of such expenses.

 

(d)                                 Return of Company Property.  Executive represents that on or before the date that is ten (10) days following the Termination Date, Executive will return to the Company all written Confidential Information (as defined in the Employment Agreement) in Executive’s possession (including, but not limited to, Company-provided credit cards, building or office access cards, keys, computer or other business equipment, manuals, files, documents, records, software, employee database and other data), and that Executive will not retain any copies, compilations, extracts, excerpts, abstracts, summaries or other notes of any such manuals, files, documents, records, software, customer or employee database or other data files, memoranda, records, and other documents, and any other physical or personal property which are the property of the Company and which Executive had in Executive’s possession, custody or control, including any computers, cellular phones, tablets, PDAs or similar business equipment; provided, however, that Executive shall be permitted to retain his laptop and access to his BOX account during the Cooperation Period; and provided, further, that if Executive has inadvertently retained non-material Confidential Information or property of the Company (“Covered Information”), it shall not be a breach of this Agreement or any of the Surviving Provisions if (i) promptly after becoming aware of his possession of such Covered Information Executive returns it to the Company, (ii) Executive has not disclosed such Covered Information in violation of the Surviving Provisions, and (iii) no loss or damage that is more than de minimis has been caused to the Company as a result of Executive’s retention of such Covered Information.  Notwithstanding this Section 6(d), the Company may provide Executive with Confidential Information and Company property in connection with his obligations under Section 6(c) hereof and Executive acknowledges and agrees that he shall return all such Confidential Information and Company property (including his laptop and access to his BOX account) within ten (10) days after the end of Executive’s obligations under Section 6(c) hereof or such earlier date as is requested reasonably in advance in writing by the Company (with the same procedures to apply regarding the inadvertent retention of Covered Information as set forth in the immediately preceding sentence).

 

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7.             Executive Representations.  Executive warrants and represents that (a) Executive has not filed or authorized the filing of any complaints, charges or lawsuits against the Company with any governmental agency or court regarding any claims released in this Agreement, and that if, unbeknownst to Executive, such a complaint, charge or lawsuit has been filed on Executive’s behalf, Executive will immediately cause it to be withdrawn and dismissed, (b) Executive has reported all hours worked as of the date of this Agreement and has been paid all compensation, wages, bonuses, commissions, and/or benefits to which Executive may be entitled and no other compensation, wages, bonuses, commissions and/or benefits are due to Executive, except as provided in this Agreement, (c) Executive has no known workplace injuries or occupational diseases and has been provided and/or has not been denied any leave requested under the Family and Medical Leave Act or any state law counterpart, (d) the execution, delivery and performance of this Agreement by Executive does not and will not conflict with, breach, violate or cause a default under any agreement, contract or instrument to which Executive is a party or any judgment, order or decree to which Executive is subject, (e) Executive is executing this Agreement voluntarily and without any duress or undue influence on the part or behalf of the Company, with full understanding of the terms and consequences, and (f) upon the execution and delivery of this Agreement by the Company and Executive, this Agreement will be a valid and binding obligation of Executive, enforceable in accordance with its terms.

 

8.             Governing Law.  This Agreement shall be construed and enforced in accordance with, and the rights of the parties hereunder shall be governed by, the laws of New York, without regard to any principles of conflicts of laws.

 

9.             Section 409A.  It is intended that each installment of the payments provided hereunder constitute separate “payments” for purposes of Treasury Regulation Section 1.409A-2(b)(2)(i).  It is further intended that payments hereunder satisfy, to the greatest extent possible, the exemption from the application of Code Section 409A provided under Treasury Regulation Section 1.409A-1(b)(4) (as a “short-term deferral”).  To the extent that any provision of this Agreement is ambiguous as to its compliance with Code Section 409A, the provision will be read in such a manner so that all payments hereunder comply with Code Section 409A.  To the extent any expense reimbursement or the provision of any in-kind benefit under this Agreement is determined to be subject to Code Section 409A, the amount of any such expenses eligible for reimbursement, or the provision of any in-kind benefit, in one calendar year shall not affect the expenses eligible for reimbursement, or the amount of in-kind benefits to be provided, in any other calendar year (except for any lifetime or other aggregate limitation applicable to medical expenses), in no event shall any expenses be reimbursed after the last day of the calendar year immediately following the calendar year in which Executive incurred such expenses, and in no event shall any right to reimbursement or the provision of any in-kind benefit be subject to liquidation or exchange for another benefit.

 

10.          Miscellaneous. This Agreement, together with the Surviving Provisions and Section 5 of the  Employment Agreement, is the entire agreement between the parties with regard to the subject matter hereof.  Executive and the Company acknowledge that there are no other agreements, written, oral or implied regarding such subject matter, and that neither the Company nor Executive may rely on any prior negotiations, discussions, representations or agreements regarding the subject matter hereof.  Whenever possible, each provision of this Agreement shall be interpreted in a manner as to be effective and valid under applicable law, but

 

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if any provision shall be held to be prohibited or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating or affecting the remainder of such provision or any of the remaining provisions of this Agreement.  The Company represents that the Board of Directors of the Company has duly and validly authorized this Agreement.  This Agreement may be modified only in writing, and such writing must be signed by both Executive and the Company and recited that it is intended to modify this Agreement.  Within 10 days after both the Effective Date and the Company’s receipt of substantiation of expenses, the Company shall pay to Dechert LLP all legal fees incurred by Executive to Dechert LLP in connection with the negotiation and execution of this Agreement.

 

(signature page follows)

 

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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed and delivered as of the dates indicated below.

 

	
 
    	
EXECUTIVE
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Kunwar Shailubhai
    
	
 
    	
Kunwar Shailubhai
    
	
 
    	
Date: May 23, 2017
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
COMPANY
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Gary Jacob
    
	
 
    	
Name: Gary Jacob
    
	
 
    	
Title: Chairman and   Chief Executive Officer
    
	
 
    	
Date: May 24, 2017
    

 

14

 

EXHIBIT A

 

CONFIDENTIALITY AGREEMENT AND INVENTIONS AGREEMENT

 

15

 

EXHIBIT B

 

DISCLOSURE INFORMATION PROVIDED PURSUANT TO THE

OLDER WORKERS BENEFIT PROTECTION ACT

 

16Exhibit

LOGITECH INTERNATIONAL S.A. 2006 STOCK INCENTIVE PLAN
RESTRICTED STOCK UNIT AGREEMENT
This Restricted Stock Unit Agreement, including any country-specific terms and conditions set forth in the attached Appendix (collectively, the “Agreement”), is between Logitech International S.A., a Swiss company (the “Company”), and the Participant named below and is made pursuant to the Logitech International S.A. 2006 Stock Incentive Plan (the “Plan”).  To the extent any capitalized terms used in this Agreement are not defined, they shall have the meaning given to them in the Plan. In the event of a conflict between the terms and conditions of the Plan and the terms and conditions of this Agreement, the terms of the Plan shall prevail.
In consideration of the mutual agreements herein contained and intending to be legally bound hereby, the parties agree as follows:
1.    Grant of Restricted Stock Units.  The Company hereby grants to the Participant named below the number of Restricted Stock Units corresponding to Shares specified below, subject to the terms and conditions of this Agreement and of the Plan, which is incorporated in this Agreement by reference:
	
			
	Participant’s Name:
	[NAME]

	 
	 
	 

	Grant Date:
	[GRANT DATE]

	 
	 
	 

	Total Number of Restricted Stock
	[UNITS]

	Units granted:
	 
	 

2.    Vesting.  The Restricted Stock Units subject to this Award shall vest [INSERT VESTING CRITERIA] (each such date being a “Vesting Date”), subject to the Participant’s continuous Service through the applicable Vesting Date, until all Restricted Stock Units subject to this Award are vested in full.  In no event shall any Restricted Stock Units vest after the Participant’s termination of Service.  Notwithstanding the foregoing, the Restricted Stock Units shall be subject to the provisions contained in Sections 5(b) and 5(c) hereof [AS APPLICABLE: and in Addendum A, which is attached to this Agreement [AS APPLICABLE AND FOR PARTICIPANTS OTHER THAN MEMBERS OF THE GROUP MANAGEMENT TEAM ONLY: , and to the terms and conditions of any change of control severance agreement between the Company or Employer (as defined in Section 6) and the Participant (a “COC Severance Agreement”)]].
3.    Settlement of Vested Restricted Stock Units.  The Participant’s vested Restricted Stock Units shall be settled promptly after the applicable Vesting Date pursuant to Section 2 or accelerated vesting event pursuant to Section 5(b), provided that the Company shall have no obligation to issue Shares pursuant to this Agreement unless and until the Participant has satisfied any applicable tax and/or other obligations pursuant to Section 8 below and such issuance otherwise complies with Applicable Laws.  The foregoing notwithstanding, Restricted Stock Units shall be settled within sixty (60) days after the applicable Vesting Date or accelerated vesting event, subject to Section 24 hereof.  At the time of settlement, the Participant shall receive one Share for each vested Restricted Stock Unit, net of applicable withholdings.  The Company in its discretion may designate a brokerage firm to assist with settlement of Restricted Stock Units, or as the sole means for settlement of Restricted Stock Units.

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4.    Nature of Restricted Stock Units.  The Restricted Stock Units are mere bookkeeping entries and represent only an unfunded and unsecured obligation of the Company to issue or deliver Shares on a future date.  As a holder of Restricted Stock Units, the Participant has no rights other than the rights of a general creditor of the Company.  The Restricted Stock Units carry neither voting rights nor rights to cash or other dividends.  The Participant has no rights as a shareholder of the Company by virtue of the Restricted Stock Units unless and until the Restricted Stock Units are settled by issuing or delivering Shares.
5.    Termination of Service.  
(a)    Except as otherwise provided in Sections 5(b) or 5(c), if the Participant’s Service terminates for any reason, whether or not such termination is later found to be invalid or in breach of employment laws in the jurisdiction where the Participant is employed or the terms of the Participant’s employment agreement, if any, all unvested Restricted Stock Units shall be forfeited effective on the date the Participant’s Service terminates.  The Participant’s date of termination of Service shall mean the date upon which the Participant’s active Service terminates, regardless of any notice period or period in lieu of notice of termination of employment or similar period mandated under employment laws in the jurisdiction where the Participant is employed or the terms of a written employment agreement, if any. The Administrator shall have the exclusive discretion to determine when the Participant’s active Service terminates for purposes of this Award (i.e., when the Participant has ceased active performance of services for purposes of vesting in this Award), including whether a leave of absence constitutes a termination of Service for purposes of this Award.
(b)    If the Participant’s Service terminates by reason of death or Disability, any unvested Restricted Stock Units shall vest immediately as of the date of such termination of Service.  
(c)    If the Participant’s Service terminates by reason of Retirement, any unvested Restricted Stock Units shall continue to vest (in accordance with the schedule set forth in Section 2) on any Vesting Date that occurs subsequent to the Participant’s date of termination of Service without regard to the requirement that the Participant continue in Service through the applicable Vesting Date and subject to the Participant’s continued compliance with any post-termination restrictive covenants to which the Participant may be subject, including, without limitation, the provisions of the Logitech Employee Non-disclosure Agreement.  For purposes of this Section 5(c), the definition of Retirement is set forth in the country-specific provisions in the attached Appendix that apply to the Participant.
6.    Recovery of Erroneously Awarded Compensation.  If the Participant is now or is hereafter subject to the Executive Clawback Policy adopted by the Company’s Board of Directors, or any committee thereof, or any policy providing for the recovery of Awards, Shares, proceeds, or payments to Participant in the event of fraud or as required by Applicable Laws or governance considerations or in other similar circumstances, then this Award, and any Shares or other payments resulting from settlement of the Restricted Stock Units or proceeds therefrom, are subject to potential recovery by the Company or the Participant’s employer (the “Employer”) under the circumstances set out in the Executive Clawback Policy or such other similar policy as in effect from time to time.
7.    Suspension or Cancellation for Misconduct.  If at any time (including after vesting but before settlement) the Administrator reasonably believes that the Participant has committed an act of misconduct as described in this Section 7, the Administrator may suspend the vesting or settlement of Restricted Stock Units, pending a determination of whether an act of misconduct has been committed.  If the Administrator determines that the Participant has committed an act of embezzlement, fraud or breach of fiduciary duty, or if the Participant makes an unauthorized disclosure of any trade secret or confidential information of the Company or any of its Subsidiaries or Affiliates, or induces any customer to breach a contract with the 

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Company or any of its Subsidiaries or Affiliates, then this Agreement shall terminate immediately and cease to be outstanding.  Any determination by the Administrator with respect to the foregoing shall be final, conclusive and binding on all interested parties.  If the Participant holds the title of Vice President or above, the determination of the Administrator shall be subject to the approval of the Company’s Board of Directors.
8.    Responsibility for Taxes.  
(a)    Regardless of any action the Company or the Employer takes with respect to any or all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to the Participant’s participation in the Plan and legally applicable to the Participant (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items is and remains the Participant’s responsibility and may exceed the amount actually withheld by the Company or the Employer.  The Participant further acknowledges that the Company and/or the Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Restricted Stock Units, including, but not limited to, the grant, vesting or settlement of the Restricted Stock Units, the issuance of Shares upon settlement of the Restricted Stock Units, the subsequent sale of Shares acquired pursuant to such issuance and the receipt of any dividends and/or any dividend equivalents; and (ii) do not commit to and are under no obligation to structure the terms of the Award or any aspect of the Restricted Stock Units to reduce or eliminate the Participant’s liability for Tax-Related Items or achieve any particular tax result.  Further, if the Participant has become subject to Tax-Related Items in more than one jurisdiction between the date of grant and the date of any relevant taxable or tax withholding event, as applicable, the Participant acknowledges that the Company and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
(b)    Prior to any relevant taxable or tax withholding event, as applicable, the Participant will pay or make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all Tax-Related Items.  In this regard, the Participant authorizes the Company and/or the Employer, or their respective agents, at their discretion, to satisfy the obligations with regard to all Tax-Related Items by one or a combination of the following:  (i) withholding from the Participant’s wages or other cash compensation paid to the Participant by the Company and/or the Employer; or (ii) withholding from proceeds of the sale of Shares acquired upon settlement of the Restricted Stock Units either through a voluntary sale or through a mandatory sale arranged by the Company (on the Participant’s behalf pursuant to this authorization); or (iii) withholding in Shares to be issued upon vesting of the Restricted Stock Units, provided, however, that if the Participant is a Section 16 officer of the Company under the Exchange Act, then the Company will withhold in Shares upon the relevant taxable or tax withholding event, as applicable, unless the use of such withholding method is problematic under applicable tax or securities law or has materially adverse accounting consequences, in which case, the obligation for Tax-Related Items may be satisfied by one or a combination of methods (i) and (ii) hereof.  Depending on the withholding method, the Company may withhold or account for Tax-Related Items by considering applicable statutory withholding rates up to the maximum rates applicable in the Participant’s jurisdiction, in which case, under withholding method 8(b)(ii) or (iii) hereof, the Participant will receive a refund of any over-withheld amount in cash and will have no entitlement to the equivalent in Shares.  If the obligation for Tax-Related Items is satisfied by withholding in Shares, for tax purposes, the Participant is deemed to have been issued the full number of Shares subject to the vested Restricted Stock Units, notwithstanding that a number of the Shares are held back solely for the purpose of paying the Tax-Related Items due as a result of any aspect of the Participant’s participation in the Plan.
(c)    The Participant shall pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of the Participant’s participation in the Plan that cannot be satisfied by the means previously described.  The Company may 

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refuse to issue or deliver the Shares or the proceeds of the sale of Shares, if the Participant fails to comply with the Participant’s obligations in connection with the Tax-Related Items.
(d)    Notwithstanding anything in this Section 8 to the contrary, to avoid a prohibited distribution under Code Section 409A, if Shares underlying the Restricted Stock Units will be withheld (or sold on the Participant’s behalf) to satisfy any Tax-Related Items arising prior to the date of settlement of the Restricted Stock Units for any portion of the Restricted Stock Units that is considered an item of “nonqualified deferred compensation” subject to Code Section 409A, then the number of Shares withheld (or sold on the Participant’s behalf) shall not exceed the number of Shares that equals the liability for the Tax-Related Items.
9.    Compliance with Applicable Laws; No Company Liability.  No Shares shall be issued or delivered pursuant to the settlement of the Restricted Stock Units unless such issuance or delivery complies with Applicable Laws.  The Company shall not be liable to the Participant or other persons as to (a) the non-issuance or delivery of Shares as to which the Company has been unable to obtain from any regulatory body having jurisdiction the authority deemed by the Company’s counsel to be necessary to the lawful issuance or delivery of any Shares hereunder and (b) any tax consequence expected, but not realized, by the Participant or other person due to the receipt, vesting or settlement of the Restricted Stock Units.
10.    Non-Transferability of Restricted Stock Units.  The Restricted Stock Units and this Agreement may not be transferred in any manner otherwise than by will, by the laws of descent or distribution or, if the Company permits, by a written beneficiary designation.  The terms of the Plan and this Agreement shall be binding upon the executors, administrators, heirs, beneficiaries, successors and assigns of the Participant.
11.    No Advice Regarding Grant.  The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Participant’s participation in the Plan, or the Participant’s acquisition or sale of the underlying Shares.  The Participant should consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
12.    Nature of Grant.  In accepting the grant, the Participant acknowledges, understands and agrees that:
(a)the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time;
(b)the grant of the Restricted Stock Units is voluntary and occasional and does not create any contractual or other right to receive future grants of Restricted Stock Units, or benefits in lieu of Restricted Stock Units, even if Restricted Stock Units have been granted in the past; 
(c)all decisions with respect to future Restricted Stock Units grants, if any, will be at the sole discretion of the Company; 
(d)the Participant’s participation in the Plan shall not create a right to further Service with the Employer and shall not interfere with the ability of the Employer to terminate the Participant’s Service at any time; 
(e)the Participant is voluntarily participating in the Plan; 
(f)the Restricted Stock Units and the Shares subject to the Restricted Stock Units are extraordinary items that do not constitute compensation of any kind for services of any kind rendered to the Company or the Employer, and which are outside the scope of the Participant’s employment contract, if any; 

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(g)the Restricted Stock Units and the Shares subject to the Restricted Stock Units are not intended to replace any pension rights or compensation; 
(h)the Restricted Stock Units and the Shares subject to the Restricted Stock Units are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculating any [FOR PARTICIPANTS OTHER THAN MEMBERS OF THE GROUP MANAGEMENT TEAM ONLY: severance,] resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments; 
(i)the grant of the Restricted Stock Units and the Participant’s participation in the Plan will not be interpreted to form an employment contract or relationship with the Company or any Subsidiary or Affiliate; 
(j)the future value of the underlying Shares is unknown and cannot be predicted with certainty;
(k)no claim or entitlement to compensation or damages shall arise from forfeiture of the Restricted Stock Units resulting from termination of the Participant’s Service by the Company or the Employer (for any reason whatsoever and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Participant is employed or the terms of the Participant’s employment agreement, if any) and, in consideration of the grant of the Restricted Stock Units to which the Participant is otherwise not entitled, the Participant (to the extent permitted by applicable laws) irrevocably agrees never to institute any claim against the Company or the Employer, waives the ability, if any, to bring any such claim and releases the Company and the Employer from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, the Participant (to the extent permitted by applicable laws) will be deemed irrevocably to have agreed not to pursue such claim and agrees to execute any and all documents necessary to request dismissal or withdrawal of such claims;
(l)unless otherwise provided in the Plan or by the Company in its discretion, the Restricted Stock Units and the benefits evidenced by this Agreement do not create any entitlement to have the Restricted Stock Units or any such benefits transferred to, or assumed by, another company nor to be exchanged, cashed out or substituted for, in connection with any corporate transaction affecting the Shares of the Company; 
(m)unless otherwise agreed with the Company, the Restricted Stock Units and the Shares subject to the Restricted Stock Units, and the income and value of the same, are not granted as consideration for, or in connection with, the Service the Participant may provide as a director of any Subsidiary or Affiliate; and
(n)neither the Company, the Employer nor any Subsidiary or Affiliate shall be liable for any foreign exchange rate fluctuation between the Participant’s local currency and the United States Dollar or the Swiss Franc, as applicable, that may affect the value of the Restricted Stock Units or of any amounts due to the Participant pursuant to the settlement of the Restricted Stock Units or the subsequent sale of any Shares acquired upon settlement.
13.    Data Privacy.
(a)    The Participant hereby consents to the collection, processing, use and transfer, in electronic or other form, of the Participant’s personal information (the “Data”) regarding the Participant’s employment, the nature and amount of the Participant’s compensation and the fact and conditions of the Participant’s participation in the Plan (including the Participant’s name, home address, telephone number, email address, date of birth, social insurance number, passport or other identification number, 

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compensation, nationality and job title, details of all options, shares or other entitlement to securities awarded, canceled, exercised, vested, unvested or outstanding under the Plan or predecessor plans), by and among the Company and one or more its Subsidiaries and Affiliates, for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan and in calculating the cost of the Plan.
(b)    The Participant further consents to the transfer of the Data to the Company’s designated broker for the Plan (currently, UBS AG or Equatex AG and their respective affiliates (the “Plan Broker”), or to any other third parties assisting in the implementation, administration and management of the Plan, or in calculating the costs of the Plan, including any other third party assisting with the settlement of Restricted Stock Units under the Plan or with whom Shares acquired upon settlement of the Restricted Stock Units or cash from the sale of such Shares may be deposited.  The Participant further consents to the processing, possession, use and transfer of the Data by the Plan Broker and such other third parties for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan and in calculating the cost of the Plan.
(c)    The Participant understands and agrees that the recipients of the Data may be located in the United States or elsewhere, and that the recipients’ countries may have different data privacy laws and protections than the Participant’s country, and the Participant consents to the transfer of the Data to such countries.  Furthermore, the Participant acknowledges and understands that the transfer of the Data to the Company or any of its Subsidiaries or Affiliates, or to the Plan Broker or any such third parties, is necessary for the Participant’s participation in the Plan.  The Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data or require any necessary amendments to Data or withdraw the consents herein, in any case without cost, by contacting the Participant’s local human resources representative in writing.  
(d)    Further, the Participant understands that he or she is providing the consents herein on a purely voluntary basis.  If the Participant does not consent, or later seeks to revoke his or her consent, the Participant’s employment status or service and career with the Employer will not be adversely affected; the only consequence of refusing or withdrawing consent is that the Company would not be able to grant Restricted Stock Units or other equity awards to the Participant or administer or maintain such awards. Therefore, the Participant acknowledges that withdrawal of consent may affect the Participant’s ability to realize benefits from the Restricted Stock Units, and the Participant’s ability to participate in the Plan.
14.    Exchange Control and Foreign Asset/Account Reporting Acknowledgement.  Local foreign exchange laws may affect the grant of the Restricted Stock Units, the receipt of Shares upon settlement of the Restricted Stock Units, the sale of Shares received upon settlement of the Restricted Stock Units and/or the receipt of dividends or dividend equivalents (if any).  Such laws may affect the Participant’s ability to hold funds outside the Participant’s country and may require the repatriation of any cash, dividends or dividend equivalents received in connection with the Restricted Stock Units.  The Participant may also be subject to foreign asset/account reporting requirements as a result of the acquisition, holding or transfer of Shares or cash resulting from participation in the Plan, to or from a brokerage/bank account or entity located outside the Participant’s country.  The applicable laws of the Participant’s country may require that he or she report such assets, accounts, the balances therein, or the transactions related thereto to the applicable authorities in such country.  The Participant is responsible for being aware of and satisfying any exchange control and foreign asset/account reporting requirements that may be necessary in connection with the Restricted Stock Units.  Neither the Company nor any of its Subsidiaries or Affiliates will be responsible for such requirements or liable for the failure on the Participant’s part to know and abide by the requirements 

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that are the Participant’s responsibility.  The Participant should consult with his or her own personal legal advisers to ensure compliance with local laws.  
15.    Adjustments Upon Changes in Capitalization.  In the event of a declaration of a stock dividend, a stock split, combination or reclassification of shares, extraordinary dividend of cash and/or assets, recapitalization, reorganization or any similar event affecting the Shares or other securities of the Company, the Administrator shall equitably adjust the number and kind of Restricted Stock Units or other securities which are subject to this Agreement, in order to reflect such change and thereby preclude a dilution or enlargement of benefits under this Agreement.
16.    Entire Agreement; Governing Law.  The Plan, this Agreement [AS APPLICABLE: (including Addendum A)] [AS APPLICABLE AND FOR PARTICIPANTS OTHER THAN MEMBERS OF THE GROUP MANAGEMENT TEAM ONLY: and any COC Severance Agreement] constitute the entire agreement of the parties with respect to the subject matter of this Agreement and supersede in their entirety all prior undertakings and agreements of the Company and the Participant with respect to the subject matter of this Agreement.  This Agreement is governed by the internal substantive laws, but not the choice of law rules of Switzerland (the Company’s jurisdiction of organization).
17.    Language.  If the Participant has received this Agreement or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
18.    Electronic Delivery.  The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means.  The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.
19.    Severability.  The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
20.    Appendix.  The Restricted Stock Units and any Shares subject to the Restricted Stock Units shall be subject to any special terms and conditions set forth in the Appendix to this Agreement for the Participant’s country.  Moreover, if the Participant relocates to one of the countries included in the Appendix, the special terms and conditions for such country will apply to the Participant, to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons.  The Appendix constitutes part of this Agreement.
21.    Imposition of Other Requirements.  The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Restricted Stock Units and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Participant to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing. 
22.    Permitted Modifications to Comply with Laws.  The Company reserves the right to unilaterally amend this Agreement [AS APPLICABLE: , prior to a Change of Control (as defined in Addendum A to this Agreement),] solely to facilitate compliance with existing or adopted applicable ordinances, laws, rules or regulations (“Laws”) (even if such Laws have not yet taken effect), including but not limited to any Laws related to the Minder initiative in Switzerland.

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23.    Insider Trading Restrictions/Market Abuse Laws.  Depending on Participant’s country, Participant may be subject to insider trading restrictions and/or market abuse laws, which may affect Participant’s ability to acquire or sell Shares or rights to Shares (e.g., Restricted Stock Units) during such times as Participant is considered to have “inside information” regarding the Company (as defined by the laws in Participant’s country).  Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable Company insider trading policy.  Neither the Company nor any of its Subsidiaries or Affiliates will be responsible for such restrictions or liable for the failure on the Participant’s part to know and abide by such restrictions.  The Participant should consult with his or her own personal legal advisers to ensure compliance with local laws. 
24.    Internal Revenue Code Section 409A.  
(a)Notwithstanding the foregoing, for purposes of complying with Code Section 409A, if the Restricted Stock Units are considered an item of non-qualified deferred compensation subject to Code Section 409A (“Deferred Compensation”), the vested Restricted Stock Units shall be settled within sixty (60) days after (i) the applicable Vesting Date, (ii) the Participant’s “separation from service” within the meaning of Code Section 409A in connection with an accelerated vesting event pursuant to Section 5(b) [IF APPLICABLE: and, if applicable, Addendum A], and (iii) the Participant’s death.  In addition, if the Restricted Stock Units are Deferred Compensation and payable in connection with the Participant’s separation from service, and if the Participant is a “specified employee” within the meaning of Code Section 409A on the date the Participant experiences a separation from service, then the Restricted Stock Units shall be settled on the first business day of the seventh month following the Participant’s separation from service, or, if earlier, on the date of the Participant’s death, solely to the extent such delayed payment is required in order to avoid a prohibited distribution under Code Section 409A.
(b)The Restricted Stock Units are intended to be exempt from or compliant with Code Section 409A and the U.S. Treasury Regulations relating thereto so as not to subject the Participant to the payment of additional taxes and interest under Code Section 409A or other adverse tax consequences.  In furtherance of this intent, the provisions of this Agreement will be interpreted, operated, and administered in a manner consistent with these intentions.  The Administrator may modify the terms of this Agreement and/or the Plan without the consent of the Participant, in the manner that the Administrator may determine to be necessary or advisable in order to comply with Code Section 409A or to mitigate any additional tax, interest and/or penalties or other adverse tax consequences that may apply under Code Section 409A if compliance is not practical.  This Section 24(b) does not create an obligation on the part of the Company to modify the terms of this Agreement or the Plan and does not guarantee that the Restricted Stock Units or the delivery of Shares upon settlement of the Restricted Stock Units will not be subject to taxes, interest and penalties or any other adverse tax consequences under Code Section 409A.  Nothing in this Agreement shall provide a basis for any person to take any action against the Company or any of its Subsidiaries or Affiliates based on matters covered by Code Section 409A, including the tax treatment of any amounts paid under this Agreement, and neither the Company nor any of its Subsidiaries or Affiliates will have any liability under any circumstances to the Participant or any other party if the Restricted Stock Units, the delivery of Shares upon vesting/settlement of the Restricted Stock Units or other payment or tax event hereunder that is intended to be exempt from, or compliant with, Code Section 409A, is not so exempt or compliant or for any action taken by the Administrator with respect thereto.
*   *   *
By the Participant’s agreement to this Agreement, the Participant agrees that the Restricted Stock Units are granted under and governed by the terms and conditions of the Plan and this Agreement.  The 

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Participant has reviewed the Plan and this Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement and fully understands all provisions of the Plan and Agreement.  The Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the Plan and Agreement.
In order to agree to this Agreement, please click “I Agree” below.

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[AS APPLICABLE:

LOGITECH INTERNATIONAL S.A. 2006 STOCK INCENTIVE PLAN

ADDENDUM A

Change in Control Acceleration Provisions

The following provisions shall be incorporated into the Restricted Stock Unit Agreement to which this Addendum A is attached.  To the extent any capitalized terms used in this Addendum A are not defined, they shall have the meanings given to them in the Agreement or the Plan, as applicable.

(a)    Acceleration of Vesting.  All Restricted Stock Units shall immediately vest if the Company is subject to a Change in Control before the Participant experiences a Separation from Service and an Involuntary Termination occurs within 12 months after such Change in Control.
(b)    Settlement.  All unvested Restricted Stock Units that vest pursuant to Section (a) above shall be settled in accordance with Section 3 and, if applicable, Section 24 of the Agreement.
(c)    Definitions.  The following definitions shall apply for purposes of this Addendum A:
(ii)    Base Salary.  The term “Base Salary” shall mean the greater of (i) the Participant’s annual base salary, as in effect immediately prior to the Participant’s termination of employment with the Company or Employer, or (ii) the Participant’s annual base salary as in effect on the effective date of the [AS APPLICABLE: Participant’s written employment agreement, if any] [FOR PARTICIPANTS OTHER THAN MEMBERS OF THE GROUP MANAGEMENT TEAM ONLY: COC Severance Agreement].
(iii)    Cause.  The term “Cause” shall mean the Participant’s: (A) willful dishonesty or fraud with respect to the business affairs of the Company and its direct and indirect subsidiaries (collectively, “Logitech”); (B) intentional falsification of any employment or Logitech records; (C) misappropriation of or intentional damage to the business or property of Logitech, including (but not limited to) the improper use or disclosure of the confidential or proprietary information of Logitech (excluding misappropriation or damage that results in a loss of little or no consequence to the business or property of Logitech); (D) conviction (including any plea of guilty or nolo contendere) of a felony that, in the judgment of the Board (excluding the Participant, as applicable), materially impairs the Participant's ability to perform his or her duties for Logitech or adversely affects Logitech’s standing in the community or reputation; (E) willful misconduct that is injurious to the reputation or business of Logitech; or (F) refusal or willful failure to perform any assigned duties reasonably expected of a person in his or her position (excluding during any statutory leaves of absence as permitted by law, and with reasonable accommodations for any disability required by law) after receipt of written notice by the Chief Executive Officer or Executive Chairman of the Company or Employer of such refusal or failure and a reasonable opportunity to cure (as described below).  The Participant shall be given written notice by the Employer of its intention to terminate the Participant for Cause, which notice (a) shall state with particularity the grounds on which the proposed termination for Cause is based and (b) shall be given no later than (i) ninety (90) days after the occurrence of the event giving rise to such grounds (or ninety (90) days after such later date as represents the 

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actual knowledge by an executive officer of the Company or Employer (excluding the Participant) of such grounds) or (ii) such longer or shorter period imposed by applicable laws.  The termination shall be effective upon the Participant's receipt of such notice; provided, however, that with respect to subsection (F) of this Section (c)(ii), the Participant shall have thirty (30) days (or such longer or shorter period imposed by applicable laws) after receiving such notice in which to cure any refusal or willful failure to perform (to the extent such cure is possible).  If the Participant fails to cure such failure to perform within such thirty-day (30-day) or legally applicable period, the Participant’s employment with the Employer (and Service to the Company) shall thereupon be terminated for Cause.
(iv)    Change in Control.  The term “Change in Control” shall mean the occurrence of any of the following events:
(A)    A merger or consolidation of the Company with any other entity, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation;
(B)    The complete liquidation of the Company;
(C)    The sale or other disposition by the Company of all or substantially all of the Company’s assets; or
(D)    Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becoming the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the Company’s then outstanding voting securities.
(v)    Good Reason.  The term “Good Reason” shall mean:  (A) a substantial reduction of the facilities and perquisites (including office space and location) available to the Participant immediately prior to such reduction, without the Participant’s express written consent and without good business reasons; (B) a material reduction of the Participant’s Base Salary; (C) a material reduction in the kind or level of employee benefits to which the Participant is entitled immediately prior to such reduction, with the result that the Participant’s overall benefits package is significantly reduced; (D) the relocation of the Participant to a facility or location more than 30 miles from his or her current location, without the Participant’s express written consent; (E) the Company’s failure to obtain the assumption by any successor of the Company of [AS APPLICABLE: the Participant’s written employment agreement, if any] [FOR PARTICIPANTS OTHER THAN MEMBERS OF THE GROUP MANAGEMENT TEAM ONLY: any COC Severance Agreement (to the extent contemplated under such COC Severance Agreement)]; or (F) a material reduction of the Participant’s duties, position or responsibilities relative to the Participant’s duties, position or responsibilities in effect immediately prior to such reduction, without the Participant’s express written consent.  Clause (C) above shall not apply in the event of any reduction of the amount of the bonus actually paid but shall apply in the event of a material 

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reduction of the target bonus or bonus opportunity.  A condition shall not be considered “Good Reason” unless the Participant gives the Company or Employer (or a successor of the Company or Employer, if applicable) written notice of such condition within 90 days after such condition comes into existence and the Company or Employer (or a successor of the Company or Employer, if applicable) fails to remedy such condition within 30 days after receiving the Participant’s written notice.
(vi)    Involuntary Termination.  The term “Involuntary Termination” shall mean that the Participant experiences a Separation from Service caused by (i) a termination by the Company or Employer of the Participant’s employment with the Company or Employer that is not effected for Cause or (ii) a resignation by the Participant of his or her employment with the Company or Employer for Good Reason.
(vii)    Separation from Service.  The term “Separation from Service” shall mean a “separation from service,” as defined in the regulations under Section 409A of the Code.
(d)    [FOR PARTICIPANTS OTHER THAN MEMBERS OF THE GROUP MANAGEMENT TEAM ONLY: Effect of Change of Control Severance Agreement.  Notwithstanding any provisions in this Addendum A, the applicable provisions contained in any COC Severance Agreement shall supersede the provisions contained in this Addendum A.]
(e)    Effect of Merger.  In the event that the Company is a party to a merger, consolidation or reorganization, the Restricted Stock Units subject to this Award shall be subject to Section 16 of the Plan; provided that any action taken pursuant to Section 16 of the Plan shall either (i) preserve the exemption of this Award from Section 409A of the Code or (ii) comply with Section 409A of the Code.]

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LOGITECH INTERNATIONAL S.A. 2006 STOCK INCENTIVE PLAN

APPENDIX

ADDITIONAL TERMS AND CONDITIONS OF
RESTRICTED STOCK UNIT AGREEMENT
This Appendix includes additional terms and conditions that govern the Restricted Stock Units granted to the Participant under the Plan if the Participant resides in one of the countries listed below.  Capitalized terms used but not defined in this Appendix shall have the meanings set forth in the Plan and/or the Agreement.
This Appendix also includes information regarding securities law and other issues of which the Participant should be aware with respect to participation in the Plan.  The information is based on the securities law and other laws in effect in the respective countries as of March 2017.  Such laws are often complex and change frequently.  As a result, the Company strongly recommends that the Participant not rely on the information in this Appendix as the only source of information relating to the consequences of the Participant’s participation in the Plan because the information may be out of date at the time that the Restricted Stock Units vest or the Participant sells Shares acquired under the Plan.
In addition, the information contained herein is general in nature and may not apply to the Participant’s particular situation and the Company is not in a position to assure the Participant of a particular result.  Accordingly, the Participant is advised to seek appropriate professional advice as to how the relevant laws in the Participant’s country may apply to the Participant’s situation.  
Finally, if the Participant is a citizen or resident of a country other than the one in which the Participant currently working or transfers employment between countries after the Grant Date, the Participant may be subject to the special terms and conditions for more than one country and/or the information for more than one country may be applicable to the Participant. It is also possible that the special terms and conditions and the information may not be applicable to the Participant in such a case.
ALL CURRENT EUROPEAN ECONOMIC AREA ("EEA") MEMBER COUNTRIES
Termination of Service Due to Retirement.  The following supplements Section 5(c) of the Agreement:
“Retirement” for purposes of Section 5(c) shall mean the Participant’s termination of Service (under circumstances that would not give rise to the Participant’s termination of Service for cause by the Employer) due to actual retirement upon satisfying the eligibility requirements for retirement under local law in the Participant’s country.  If there are no applicable retirement provisions under local law in the Participant’s country, then Retirement shall be determined in accordance with the policies established by the Administrator from time to time.
Notwithstanding anything herein to the contrary, the Administrator may cause the Restricted Stock Units to vest prior to the Vesting Date(s) in order to satisfy any Tax-Related Items that arise prior to the date of settlement of the Restricted Stock Units, subject to the limitations set forth in Section 8 of the Agreement.

6656120-v17\GESDMS

SWITZERLAND
Termination of Service Due to Retirement.  The following supplements Section 5(c) of the Agreement:
“Retirement” for purposes of Section 5(c) shall mean the Participant’s termination of Service (under circumstances that would not give rise to the Participant’s termination of Service for cause by the Employer) following the date the Participant attains age fifty-five (55) and completes ten (10) years of continuous Service with the Company or any of its Subsidiaries or Affiliates.
Notwithstanding anything herein to the contrary, the Administrator may cause the Restricted Stock Units to vest prior to the Vesting Date(s) in order to satisfy any Tax-Related Items that arise prior to the date of settlement of the Restricted Stock Units, subject to the limitations set forth in Section 8 of the Agreement.

Securities Law Information.  The grant of the Restricted Stock Units is considered a private offering in Switzerland; therefore, it is not subject to registration in Switzerland.
UNITED STATES (“U.S.”)
Termination of Service Due to Retirement.  The following supplements Section 5(c) of the Agreement:
“Retirement” for purposes of Section 5(c) shall mean the Participant’s termination of Service (under circumstances that would not give rise to the Participant’s termination of Service for cause by the Employer) following the date the Participant attains age fifty-five (55) and completes ten (10) years of continuous Service with the Company or any of its Subsidiaries or Affiliates.

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