Document:

Exhibit 10.1

 

 

 

NEUROSENSE THERAPEUTICS LTD.

 

2018 SHARE OPTION PLAN

 

AMENDED BY THE BOARD OF DIRECTORS 

 

ON OCTOBER 31, 2021

 

 

 

     

     

    

 

NEUROSENSE THERAPEUTICS LTD.

 

2018 SHARE OPTION PLAN

 

1. Purpose.
The purpose of this 2018 Share Option Plan (the “Plan”) is to advance the interests of the Company and its shareholders
by attracting and retaining the best available personnel for positions of substantial responsibility, providing additional incentive to
employees, officers, directors, advisors and consultants and promoting a close identity of interests between those individuals and the
Company and/or an Affiliate (as defined below). The provisions specified hereunder apply only to persons who are subject to taxation by
the State of Israel with respect to their Options (as defined below).

 

2. Definitions

 

2.1 Defined
Terms.      Initially capitalized terms, as used in this Plan, shall have
the meaning ascribed thereto as set forth below:

 

	“102 Participant”	means, an Israeli tax resident who is an employee or a director of the Company or an Israeli Affiliate, on behalf of whom an Option is granted under Section 102.
	 	 
	 “Administrator”	means the Board, or a committee to which the Board shall have delegated power to act on its behalf with respect to the Plan.  The Administrator, if it is a committee, shall consist of such number of members (but not less than two (2)) as may be determined by the Board.
	 	 
	
    “Affiliate(s)”

     
	means a present or future company that either (i) Controls the Company, (ii) is Controlled by the Company; or (iii) is Controlled by the same person or entity that Controls the Company.
	 	 
	“Applicable Law”	means all laws applicable to the grant of Options pursuant to this Plan, including but not limited to the requirements under tax laws, social security laws, security laws, companies laws, any stock exchange or quotation system on which the Shares are listed or quoted, the applicable law in the country or jurisdiction of any such system, and the applicable law of any other country or jurisdiction where Options are granted under the Plan.
	 	 
	“Articles”	means the Articles of Association of the Company, as may be amended from time to time.
	 	 
	“Board”	means the board of directors of the Company.
	 	 
	“Capital Gains Track Through
a Trustee”	means the Company’s choice of
the capital gains track of taxation for share allocation to employees under Section 102 through a trustee.
	 	 
	

    “Cause”
	
    means, when used in connection with the termination
    of a Participant’s employment with, or services to the Company or an Affiliate, and forming the basis of such termination: (a) the
    definition ascribed to Cause in the individual employment agreement or services agreement between the Company and/or its Affiliate and
    the Participant; or (b) if no such definition exists, then any of the following, including but not limited to: dishonesty toward the Company
    or Affiliate, insubordination, substantial malfeasance or nonfeasance of duty, unauthorized disclosure of confidential information and
    conduct substantially prejudicial to the business of the Company or Affiliate; or any substantial breach by the Participant of: (A) his
    or her employment or service agreement with the Company or an Affiliate; or (B) any other obligations towards the Company or an Affiliate.

 

    2

     

    

 

	“Commencement Date”	means the date of commencement of the vesting schedule with respect to a Grant of Options which, unless otherwise determined by the Administrator, shall be the date on which such Options shall be granted. 
	 	 
	“Company”	means Neurosense Therapeutics Ltd., a company incorporated under the laws of the State of Israel.
	 	 
	“Consultant”	means an Israeli resident, who serves as a consultant of the Company or an Israeli resident Affiliate and is not entitled to receive Options under Section 102, on behalf of whom an Option is granted under Section 3(i).
	 	 
	“Control” or “Controlled”	shall have the meaning ascribed thereto in Section 102.
	 	 
	“Date of Grant”	shall have the meaning set forth in Section 6.2 of this Plan.
	 	 
	“Director”	means a member of the Board.
	 	 
	“Disability”	means total and permanent physical or mental impairment or sickness of a Participant, making it impossible for the Participant to continue such Participant’s employment with or service to the Company or Affiliate.
	 	 
	“Earned Income Track”	means the Company’s choice of the work income course of taxation for share allocation to employees under Section 102 through a trustee.
	 	 
	“Election”	shall have the meaning set forth in Section 11.1 of this Plan.
	 	 
	“Employee”	shall have the meaning set forth in Section 102.
	 	 
	“Exercise Notice”	shall have the meaning set forth in Section 7.4(a) of this Plan.
	 	 
	“Exercise Price”	Memeans the price determined by the Administrator in accordance with Section 7.1 below which is to be paid to the Company in order to exercise a Granted Option and convert such Option into an Underlying Share.
	 	 
	“Fair Market Value”	means, as of any date, the value of a Share determined as follows: (i) if the Company’s shares are listed on any established stock exchange or a national market system, including without limitation the Nasdaq Global Select Market, Nasdaq Global Market or the Nasdaq Capital Market of the Nasdaq Stock Market, the Fair Market Value shall be the closing sales price of such shares (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable; without derogating from the above and solely for the purpose of determining the tax liability pursuant to Section 102 (and in particular Section 102(b)(3)), if on the date of grant the Company’s shares are listed on any established stock exchange or a national market system or if the Company’s shares will be registered for trading within ninety days following the date of grant under the Section 102 Capital Gains Track Through a Trustee, the Fair Market Value of a Share on its date of grant shall be determined in accordance with the average value of the Company’s shares during the thirty trading days immediately preceding the date of grantor during the thirty (30) trading days immediately following the date of registration for trading (if the Company’s shares will be listed within ninety days following the date of grant), as the case may be; or (ii) if the Company’s shares are regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value shall be the mean between the high bid and low asked prices for the Company’s shares on the last market trading day prior to the day of determination; or (iii) in the absence of an established market for the Company’s shares, the Fair Market Value shall be determined in good faith by the Administrator (including in accordance with an independent third party valuation of the Company which may be obtained by the Administrator).

 

    3

     

    

 

	“Grant Letter”	means a written agreement between the Company to a Participant evidencing the terms and conditions of an individual grant of Options. The Grant Letter shall specify among others: (i) the Tax Provision under which the Option is granted; (ii) the Tax Track that the Company has elected according to Section 11 of the Plan (if applicable); (iii) the Exercise Price; (iv) the number of Options granted to the Participant; (v) the Date of Grant; and (vi) the vesting schedule.
	 	 
	“Grant of Options” or “Granted Options”	means the grant of Options by the Company to a Participant pursuant to a Grant Letter.
	 	 
	“Holding Period”	means with respect to Options granted under Section 102, the minimum period in which the Options granted to a Participant or, upon exercise thereof, the Underlying Shares, are to be held by the Trustee on behalf of the Participant, in accordance with Section 102, and pursuant to the Tax Track which the Company elected. 
	 	 
	“IPO”	means the initial public offering of shares of the Company and the listing of such shares for trading on any recognized stock exchange or over-the-counter or computerized securities trading system.
	 	 
	“ITA”	means the Israeli Tax Authority.
	 	 
	“Merger Transaction” or “Merger”	means any of the following but excluding any Re-organization or Spin-off Transaction: (a) a sale of all or substantially all of the assets of the Company and its subsidiaries taken as a whole, or the sale or disposition (whether by merger or otherwise) of one or more subsidiaries of the Company if substantially all of the assets of the Company and its subsidiaries taken as a whole are held by such subsidiary or subsidiaries; or (b) a sale of all or substantially all of the shares of the share capital of the Company whether by a single transaction or a series of related transactions which occur either over a period of 12 months or within the scope of the same acquisition agreement; or (c) a merger, consolidation or like transaction of the Company with or into another corporation in which the Company is not the surviving entity, including a reverse triangular merger but excluding a merger which falls within the definition of Re-organization.
	 	 
	“Option”	means an option to purchase one Share of the Company.
	 	 
	“Non-Qualified Participant”	means a person who is not qualified to receive Options under the provisions of Section 102, on behalf of whom an Option is granted under Section 3(i). 
	 	 
	“Participant”	means 102 Participant, or a Non-Qualified Participant, or a Consultant.
	 	 
	“Plan” or “Option Plan”	means this 2018 Share Option Plan, as may be amended from time to time.
	 	 
	
    “Re-organization”

     
	means, any re-domestication of the Company, share flip, creation of a holding company for the Company which will hold substantially all of the shares of the Company or any other transaction involving the Company in which the ordinary shares of the Company outstanding immediately prior to such transaction continue to represent, or are converted into or exchanged for shares that represent, immediately following such transaction, at least a majority, by voting power, of the share capital of the surviving, acquiring or resulting corporation and in which there is no material change to the interests held by the Shareholders prior to such transaction and thereafter.
	 	 
	“Retirement”	means the termination of a Participant’s employment as a result of his or her reaching the earlier of (i) the age of retirement as defined by the Applicable Law; or (ii) the age of retirement specified in the Participant’s employment agreement.
	 	 
	“Section 102”	means Section 102 of the Tax Ordinance. 

 

    4

     

    

 

	“Section 102 Rules”	means the Income Tax Rules (Tax Relief for Issuance of Shares to Employees), 2003.
	 	 
	“Section 3(i)” 	means section 3(i) of the Tax Ordinance and the applicable rules thereto or under applicable regulations.
	 	 
	“Share”	means, ordinary share(s) of the Company, having
    a no par value.
	 	 
	
    “Shareholders”
	
    means, the shareholders of the Company.

	 	 
	
    “Spin-off Transaction”

     
	means, any transaction in which assets of the Company are transferred or sold to a company or corporate entity in which the Shareholders hold equal stakes, pro-rata to their ownership of the Company. 
	 	 
	“Tax Ordinance”	means the Israeli Income Tax Ordinance [New Version], 1961, as amended, and any regulations, rules, orders or procedures promulgated thereunder.
	 	 
	“Tax Provision”	means, with respect to the Grant of Options, the provisions of one of the three Tax Tracks in Section 102, or the provisions of Section 3(i). 
	 	 
	“Tax Track”	means one of the three tax tracks described under Section 102, specifically: (1) the Capital Gains Track Through a Trustee; (2) Earned Income Track; or (3) the Income Tax Track Without a Trustee.
	 	 
	“Term of the Options”	means, with respect to granted but unexercised Options, the time period set forth in Section 9 below.
	 	 
	“Trust Agreement”	means the agreement/s between the Company and the Trustee regarding the Options granted under this Plan to Section 102 Partipants and the underlying Shares to be held in trust, as in effect from time to time.
	 	 
	“Trustee”	means a trustee appointed by the Company and approved by the ITA, all in accordance with the provisions of Section 102(a) of the Tax Ordinance, to hold in trust, the Granted Options and the Underlying Shares issued upon exercise of such Options, on behalf of Participants. The Trustee may be replaced from time to time subject to the provisions of Section 102.  
	 	 
	“Underlying Shares”	means Shares issued or to be issued upon exercise of the Options granted in accordance with the Plan.

 

2.2 General.
Without derogating from the meanings ascribed to the capitalized terms above, all singular references in this Plan shall include the plural
and vice versa, and reference to one gender shall include the other, unless otherwise required by the context.

 

3. Shares
Available for Options. The total number of Underlying Shares reserved for issuance under the Plan and any modification thereof,
shall be:

 

(a) 1,140,000 Shares,
plus

 

(b) an annual
increase to be added as of the first day of the Company’s fiscal year, beginning in 2022 and occurring each year thereafter through
2032, equal to the 4% of the total number of Shares issued and outstanding on a fully-diluted basis as of the end of the Company’s
immediately preceding fiscal year (or such lesser number of shares, including no shares, determined by the Board in its sole discretion).

 

Such number of Shares shall be subject to adjustment
as required for the implementation of the provisions of the Plan, in accordance with Section 4 below. In the event that Options are expired
or forfeited or otherwise terminated in accordance with the provisions of the Plan, such expired or terminated Options shall become available
for future grants under the Plan.

 

    5

     

    

 

4. Adjustments

 

4.1 Changes
in Capitalization. Subject to any required action by the Shareholders, the number of Underlying Shares covered by each outstanding
Option, and the number of Shares which have been authorized for issuance under the Plan but as to which no Options have yet been granted
or which have been returned to the Plan, and the per share exercise price of each such Option, shall be proportionately and equitably
adjusted for any increase or decrease in the number of issued Shares resulting from a stock split, reverse stock split, combination, reclassification,
the payment of a stock dividend on the Shares or any other increase or decrease in the number of such Shares effected without receipt
of consideration by the Company without changing the aggregate exercise price, provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been effected without receipt of consideration. Such adjustment shall
be made by the Administrator, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided
herein, no issue by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of Shares subject to an Option. The Administrator may, if it so determines
in the exercise of its sole discretion, also make provision for proportionately adjusting the number or class of securities covered by
any Option, as well as the price to be paid therefor, in the event that the Company effects one or more reorganizations, recapitalizations,
rights offerings, or other increases or reductions of its outstanding Shares, and in the event of the Company being consolidated with
or merged into any other corporation.

 

4.2 Merger
Transaction. In the event of a Merger Transaction, any and all outstanding and unexercised unvested Options will be cancelled
for no consideration, unless determined otherwise by the Administrator. The Administrator at its sole and absolute discretion may decide:
(i) if and how the unvested Options, as the case may be, shall be canceled, exchanged, assumed, replaced, repurchased or accelerated;
(ii) if and how vested Options (including Options with respect to which the vesting period has been accelerated) shall be exercised, exchanged,
assumed, replaced and/or sold by the Trustee or the Company (as the case may be) on behalf of the Participants, including determining
that all unexercised vested Options shall be cancelled for no consideration upon a Merger Transaction; (iii) how Underlying Shares issued
upon exercise of the Options granted under of the trust tracks and held by the Trustee on behalf of 102 Participants shall be replaced
and/or sold by the Trustee on behalf of these Participant; and (iv) how any treatment of Options and underlying Shares may be made subject
to any payment or escrow arrangement, or any other arrangement determined within the scope of the Merger Transaction in relation to Options
and underlying Shares of the Company.

 

In the case of assumption
and/or substitution of Options, appropriate adjustments shall be made so as to reflect such action and all other terms and conditions
of the Grant Letter shall remain unchanged, including but not limited to the vesting schedule, all subject to the determination of the
Board, which its determination shall be at its sole discretion and final. The grant of any substitutes for the Options to Participants
further to a Merger Transaction, as provided in this section, shall be considered to be in full compliance with the terms of this Plan.
The value of the exchanged Options pursuant to this section shall be determined in good faith solely by the Board, based on the Fair Market
Value, and its decision shall be final and binding on all the Participants.

 

For the purposes of this
section, the mechanism for determining the assumption or exchange as aforementioned shall be agreed upon between the Board and the successor
company.

 

Without derogating from the
above, in the event of a Merger Transaction the Board shall be entitled, at its sole discretion, to require the Participants to exercise
all vested Options within a set time period and sell all of their Shares on the same terms and conditions as applicable to the other shareholders
selling their Company’s Shares as part of the Merger Transaction. Each Participant acknowledges and agrees that the Board shall
be entitled, subject to any applicable law, to authorize any one of its members to sign any agreement and any share transfer deeds in
customary form with respect to the Shares held by such Participant and that such agreement and share transfer deed, as applicable, shall
bind the Participant.

 

    6

     

    

 

Despite the aforementioned
and for the avoidance of any doubt, if and when the method of treatment of Options within the scope of a Merger Transaction, as provided
above, will in the sole opinion of the Board prevent the consummation of the Merger Transaction, or materially risk the consummation of
the Merger Transaction, the Board may determine different treatment for different Options held by Participants such that not all Options
will be treated equally within the scope of the Merger Transaction.

 

4.3 Fraction
of Shares. In the event that the Company will be required to issue to a Participant a fraction of a Share pursuant to this
Section 4, the Company will not issue fraction of a Share and the number of Shares shall be rounded down to the closest whole number
of Shares.

 

4.4 Calculation.
For the purposes of this section, the Company’s calculation will be final, and the Participant shall have no claims or demands against
the Company or anyone on its behalf.

 

4.5 Re-Organization.
In the event of a Re-Organization the Shares underlying the Options subject to the Plan shall be exchanged or converted into Shares of
the Company or successor company in accordance with the exchange effectuated in relation to the Shares of the Company, and the Exercise
Price and quantity of shares shall be adjusted in accordance with the terms of the Re-organization. The adjustments required thereby shall
be determined in good faith solely by the Board.

 

4.6 Spin-Off
Transaction. In the event of a Spin-Off Transaction, the Board may determine that the holders
of Options shall be entitled to receive equity in the new company formed as a result of the Spin-Off Transaction, in accordance with equity
granted to the ordinary Shareholders within the Spin-Off Transaction, taking into account the terms of the Options, including the vesting
schedule and Exercise Price. The determination regarding the Participant’s entitlement within the scope of a Spin-Off Transaction
shall be in the sole and absolute discretion of the Board.

 

5. Administration
of the Plan

 

5.1 Power.
Subject to the Applicable Law, the Articles and any resolution to the contrary by the Board, the Administrator is authorized, at its sole
and absolute discretion, to exercise all powers and authorities either specifically granted to it under the Plan or necessary or advisable
in the administration of the Plan (subject to the approval of the Board, if such approval is required by the Applicable Law) including,
without limitation:

 

(A) to determine: (i) the
Participants in the Plan, the number of Options for each Participant’s benefit and the Exercise Price; (ii) the time or times at
which Options shall be granted; (iii) whether, to what extent, and under what circumstances an Option may be settled, canceled, forfeited,
exchanged, or surrendered; (iv) any terms and conditions in addition to those specified in the Plan under which an Option may be granted;
(v) any measures, and to take any actions, as deemed necessary or advisable for the administration and implementation of the Plan; (vi)
the terms and conditions under which a Participant may elect to receive Ordinary Shares upon the exercise of the Option or in exchange
for the Underlying Shares; (vii) subject to Applicable Law, to make an Election and (viii) to appoint a Trustee; and

 

(B)
to interpret the provisions of the Plan and to take all actions resulting therefrom including without limitation: (i) subject to Section
7 below, to accelerate the date on which Granted Option under the Plan becomes exercisable; (ii) to waive or amend Plan provisions
relating to exercise of Options, including exercise of Options after termination of employment, for any reason; and (iii) to amend any
of the terms of the Plan, or any prior determinations of the Administrator.

 

    7

     

    

 

5.2 Limitations.
Notwithstanding the provisions of Section 5.1 above, no interpretations, determinations or actions of the Administrator
shall contradict the provisions of Applicable Law, and no waiver or amendment with respect to the Plan shall have a material adverse affect
on any Participant’s rights in connection with any Granted Option under the Plan without receiving the consent of such Participant.

 

6. Grant
of Options

 

6.1 Conditions
for Granting Options. Options may be granted at any time after the fulfillment of all of the following conditions: (i) the
Plan has been approved by the necessary corporate bodies of the Company; (ii) thirty (30) days after a request for approval of the Plan
has been filed for approval with the ITA or any longer period, as pursuant to the requirements of the Tax Ordinance; (iii) the Grant has
been approved by the necessary corporate bodies of the Company; and (iv) all other approvals, consents or requirements necessary by Applicable
Law have been received or met.

 

6.2 Date
of grant. The date on which Options shall be deemed granted under the Plan shall be the date on which the Company’s Board
approved the grant or the date specified as the date of grant in the Grant Letter, if specified (the “Date of Grant”).

 

6.3 Eligibility
for Options. The Administrator may grant Options to any Employee, officer, Director, or Consultant of the Company and its Affiliates.

 

6.4
 Grant Letter. Any grant of Options to a Participant shall be made in a form of a
Grant Letter and shall include a copy of the Plan. The receipt by a Participant of such Grant Letter shall be deemed as consent by such
Participant that the Option is subject to all the terms and conditions of the Grant Letter and the Plan.

 

6.5 Material
Breach. In an event of a material breach by a Participant of the terms of this Plan or the Grant Letter provided to the Participant,
or the applicable engagement agreement with such Participant, and without derogating from any of the remedies available to the Company
under any Applicable Law, the Company may, at its sole discretion, after sending a written notice to such Participant, forfeit the right
of the Participant to some or all the Options granted to such Participant.

 

7. Exercise
of Options and Sale of Shares 

 

7.1 Exercise
Price; Purchase Price. The
Exercise Price per Underlying Share deliverable upon the exercise of an Option shall be determined by the Administrator. The Exercise
Price shall be set forth in the respective Grant Letter.

 

7.2 Vesting
Schedule. All Options granted on a certain date may be subjected to continued employment with or service to the Company or
Affiliate by the Participant, become vested and exercisable in accordance with the vesting schedule as shall be determined by the Administrator
for each Participant and detailed in the respective Grant Letter.

 

7.3 minimum
Exercise. Unless otherwise determined by the Administrator,
no exercise of Options by any Participant shall be for a quantity of less than 10% of the Granted Options. An Option may not be exercised
for fractional shares. The exercise of a portion of the Granted Options shall not cause the expiration, termination or cancellation of
the remaining unexercised Options. 

 

    8

     

    

 

7.4 Manner
of Exercise. An Option may be exercised by and upon the fulfillment of the following prerequisite terms and conditions:

 

(A) Exercise
Notice- The signing by the Participant, and delivery to both the Company (at its principal office) and the Trustee (if the Options
are held by a Trustee), of an exercise notice form as prescribed by the Administrator, with such details including but not limited to:
(i) the identity of the Participant; (ii) the number of Options to be exercised; and (iii) the Exercise Price to be paid (the “Exercise
Notice”).

 

(B) Exercise
Price- The payment by the Participant to the Company, in such manner as shall be determined by the Administrator, of the Exercise
Price with respect to all the Options exercised, as set forth in the Exercise Notice.

 

(C) Issuance
of Underlying Shares- Upon the delivery of a duly signed Exercise Notice and the payment to the Company of the Exercise Price
with respect to all the Options specified therein, the Company shall issue the Underlying Shares to the Trustee (according to the applicable
Holding Period) or to the Participant, as the case may be.

 

(D) Expenses-
All costs and expenses including broker fees and bank commissions, derived from the exercise of Options or Underlying Shares, shall be
borne solely by the Participant.

 

7.5 Exercise
Restrictions. Notwithstanding anything to the contrary herein, in the event the Participant initiates any legal proceedings
to be maintained or instituted against the Company or its Representatives or participates in any manner in any legal proceedings against
the Company or its respective Representatives at any time, the Participant’s right to exercise any unexercised Options granted to
such Participant, whether vested or not on such date, shall cease as of such date and the Options shall thereupon expire. For purposes
of this Section only, the term “Representatives” shall mean the respective past, present and future officers, directors,
employees, consultants, holders of equity securities, Affiliates, successors and assigns.

 

8. Waiver
of Option Rights. At any time prior to the expiration of any unexercised Granted Option, a Participant may waive his rights
to such Option by a written notice to the Company’s principal office. Such notice shall specify the number of Granted Options, which
the Participant waives, and shall be signed by the Participant. Upon receipt by the Company of a notice of waiver of such rights, such
Options shall expire and shall become available for future Grants under the Plan.

 

9. Term
of the Options. Unless earlier terminated pursuant to the provisions of this Plan, all granted but unexercised Options shall
expire and cease to be exercisable at 5:00 p.m. Israel time on the 10th anniversary of the Commencement Date of such Options.

 

10. Termination
of Employment

 

10.1
Termination of Employment. If a Participant ceases to be an employee,
director, officer or Consultant of the Company or Affiliate for any reason (“Termination of Employment”) other
than by reason of death, Retirement, Disability or Cause, then any vested but unexercised Options on the date of Termination of
Employment (as shall be determined by the Company or Affiliate, at its sole discretion) granted on the Participant’s behalf
(“Exercisable Options”) may be exercised, if not previously expired, on or prior to the earlier of: (a) 90 days
after the date of Termination of Employment; or (b) the end of the Term of the Options. All other Granted Options for the benefit of
Participant shall expire upon the date of Termination of Employment.

 

10.2 Termination
for Cause. In the event of Termination of Employment of a Participant for Cause, then: (A) the Participant’s right to
exercise any unexercised Granted Options, whether vested or not on the date of Termination of Employment, shall cease as of such date
of Termination of Employment, and the Options shall thereupon expire, and (B) any unvested Shares shall terminate and expire on the day
the Participant has been notified of his/her dismissal. Pending a determination of whether a Participant’s conduct, activities
or circumstances give rise to Cause, the Administrator shall have the authority to suspend the exercise, payment, delivery or settlement
of all or any portion of such Participant’s outstanding Awards pending any investigation of the matter. If subsequent to the Participant’s
Termination of Employment, but prior to the exercise of Options granted to such Participant, the Administrator determines that either
prior or subsequent to the Participant’s Termination of Employment, the Participant engaged in conduct which would constitute Cause,
then the Participant’s right to exercise the Options granted to such Participant shall immediately cease upon such determination
and the Options shall thereupon expire. The determination by the Administrator as to the occurrence of Cause shall be final and conclusive
for all purposes of this Plan.

 

    9

     

    

 

10.3 Termination
by Reason of Death, Retirement, or Disability

 

(A) Death-
If Termination of Employment is by reason of death of the Participant, than his/her estate, personal representative or beneficiaries may
exercise the Participant’s Options, to the extent it was vested within the sixty (60) days period following the Participant’s
death, at any time but not later than the earlier of: (i) the one (1) year anniversary of Participant’s death; or (ii) the end of
the Term of the Options. All other Options granted for the benefit of a Participant and which have not vested within such 60-days period
shall expire upon the date of death.

 

(B) Disability and
Retirement- If Termination of Employment is by reason of Retirement or Disability of the Participant, the Participant may exercise
any portion of the Options which have vested within the ninety (90) days period following the date of Retirement or Disability, at any
time but not later than the earlier of: (i) the one (1) year anniversary of the date of Retirement or Disability, as the case may be;
or (ii) the end of the Term of the Options. All other options for the benefit of a Participant and which have not vested within such 90
days period shall expire upon the date of Retirement or Disability, as applicable.

 

10.4 Exceptions.
In special circumstances pertaining to the Termination of Employment of a certain Participant, the Administrator may at its sole
discretion decide to extend any of the periods stated above in Sections 10.1-10.3.

 

10.5 Transfer
of Employment or Service. Subject to the receipt of appropriate approvals from the ITA, if applicable, a Participant’s
right to Options granted to him/her under this Plan shall not be terminated, expire or forfeited solely as a result of the fact that the
Participant’s employment or service as an employee, officer or director changes from the Company to an Affiliate or vice versa.
Any and all tax consequence of such a transfer, if any, shall be solely borne by the Participant.

 

11. Options
and Tax Provisions. All Options shall be granted under the Plan in accordance with one of the following Tax Provisions:

 

(A)
The Company may grant Options to 102 Participant in accordance with the provisions of Section 102 and the Section 102 Rules; and

 

(B) The Company may Grant
Options to Non-Qualified Participant in accordance with the provisions of Section 3(i).

 

11.1 Tax
Provision Selection. The Company shall elect under which Tax Provision each Option is granted at its sole discretion and in
accordance with any Applicable Law (the “Election”). The Company shall notify each Participant in the Grant Letter,
under which Tax Provision the Options and/or Shares are granted and, if applicable, under which Tax Track, each Option is granted.

 

    10

     

    

 

11.2 Section
102 Trustee Tax Tracks.

 

(a) If the Company elects
to grant Options to 102 Participants through: (i) the Capital Gains Track Through a Trustee; or (ii) the Earned Income Track, then, in
accordance with the requirements of Section 102, the Company shall appoint a Trustee who will hold in trust at least for the Holding period
on behalf of each 102 Participant the granted Options and the Underlying Shares issued upon exercise of such Options.

 

(b) The Holding Period for
the Options and/or Shares will be as follows: (i) The Capital Gains Tax Track Through a Trustee - if the Company elects to grant
the Options according to the provisions of this track, then the Holding Period will be 24 months from the Date of Grant, or such period
as may be determined in any amendment of Section 102; and (ii) Earned Income Track - if the Company elects to grant Options according
to the provisions of this track, then the Holding Period will be 12 months from the Date of Grant, or such period as may be determined
in any amendment of Section 102.

 

(c) Subject to Section 102
and the Section 102 Rules, Participants shall not be able to receive from the Trustee, nor shall they be able to sell or dispose of the
Options or Underlying Shares before the end of the applicable Holding Period. If a Participant sells or removes the Options or the Underlying
Shares form the Trustee before the end of the applicable Holding Period (“Breach”), the Participant shall pay all applicable
taxes imposed on such Breach by Section 7 of the Section 102 Rules.

 

(d) In the event of a distribution
of rights, including an issuance of bonus shares, in connection with Options and/or Underlying Shares (the “Additional Rights”),
all such Additional Rights shall be granted and/or issued to the Trustee for the benefit of Participants, and shall be held by the Trustee
at least for the remainder of the Holding Period applicable to the Options and/or Underlying Shares, as applicable. Such Additional Rights
shall be treated in accordance with the provisions of the applicable Tax Track.

 

11.3 Income
Tax Track Without a Trustee. If the Company elects to grant Options to 102 Participants according to the provisions of the
Income Tax Track Without a Trustee, then the Options will not be subject to a Holding Period.

 

11.4 Concurrent
Conditions. The Holding Period, if any, is in addition to the vesting period with respect to Options, as specified in Section
7.2 of the Plan or in the Grant Letter. The Holding Period and vesting period may run concurrently, but neither is a substitute for
the other, and each are independent terms and conditions for granted Options.

 

11.5 Trust
Agreement. The terms and conditions applicable to the trust relating to the Tax Track elected by the Company, as appropriate,
shall be set forth in Trust Agreement.

 

12. Term
of Shares Held In Trust. Unless otherwise extended by the Administrator, in its sole discretion, no Underlying Shares issued
upon exercise of Options shall be held by the Trustee on behalf of the Participant for a period longer than ten (10) years after the end
of the Term of the applicable Options. The Administrator shall instruct the Trustee as to the transfer of any Underlying Shares

 

13. Rights
as a Shareholder. Unless otherwise specified in the Plan, a Participant shall not have any rights as a Shareholder with respect
to Underlying Shares issued under this Plan, until such time as the Shares shall be registered in the name of the Participant in the Company’s
register of Shareholders

 

13.1 Dividend.
The Participants shall be entitled to receive any cash dividend paid to the Shareholders with respect to Underlying Shares issued to
them under this Plan. Payments of such dividend to the Participants shall be subject to any required tax being withheld or otherwise
deducted by the Trustee or the Company, as agreed between the Company and the Trustee, in accordance with Applicable Law.

 

    11

     

    

 

14. No
Special Employment Rights. Nothing contained in this Plan shall confer upon any Participant any right with respect to the continuation
of employment by or service to the Company or Affiliate or to interfere in any way with the right of the Company or Affiliate, to terminate
such employment or service or to increase or decrease the compensation of the Participant. The Options are extraordinary, one-time benefits
granted to the Participants and are not and shall not be deemed a salary component for any purpose whatsoever, including, in connection
with calculating severance compensation under any Applicable Law.

 

15. Restrictions
on Sale of Options and Shares 

 

15.1 Options.
Options may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except by will or the laws of descent.

 

15.2 Acceleration
Provision. The Administrator, at its sole discretion, may decide to add a provision in certain Grant Letters, according to
which in case of a Merger or IPO, all or some of the unvested Options or/and Shares, shall automatically accelerate, and become fully
vested and exercisable upon such event.

 

15.3 Acknowledgement
To Restrictions. As a condition for the grant of Options and issuance of Underlying Shares thereunder, each Participant shall
acknowledge the terms and provisions of the corporate documents of the Company, including organizational documents, as amended from time
to time, and all other agreements among the Shareholders which are applicable to the holders of the Company’s Shares and shall agree
to be bound by their terms with respect to any restriction applicable to the Shares of the Company (including without limitation, any
right of first refusal, co-sale and bring along provisions, as applicable).

 

16. Tax
Matters.

 

(a) This Plan shall be governed
by, and shall conform with and be interpreted so as to comply with, the requirements of Section 102 and any written approval or ruling
from the ITA. All tax consequences under any Applicable Law (other than stamp duty) which may arise from the Grant of the Options, from
the exercise of Options or from the holding or sale of the Underlying Shares (or other securities issued under the Plan) by or on behalf
of the Participant or from any other event or act hereunder (whether any act of the Participant or of the Company or its Affiliates or
of the Trustee), shall be borne solely on the Participant. The Participant shall indemnify the Company and/or Affiliate and /or the Trustee,
as the case may be, and hold them harmless, against and from any liability for any such tax or any penalty, interest or indexing.

 

(b) Except as otherwise required
by Applicable Law, the Company shall not be obligated to honor the exercise of any Option by or on behalf of a Participant or the sale,
exchange or other transfer of any Underlying Shares issued upon exercise of Options until all tax consequences (if any) arising from the
exercise of such Options or sale, exchange or other transfer of Shares are resolved to the full satisfaction of the Company. Without derogating
from the above, the Company and/or, when applicable, the Trustee shall not be required to release any share certificate to a Participant
until all required payments have been fully made.

 

(c) If the Company elects
to grant Options according to the provisions of the Income Tax Track Without a Trustee, and if prior to the Exercise of any and/or all
of these Options, such Participant ceases to be an Employee, director, or officer of the Company or Affiliate, the Participant shall deposit
with the Company a guarantee or other security as required by law, in order to ensure the payment of applicable taxes upon the Exercise
of such Options, as the case may be.

 

(d) It is clarified that
if any grants made under either of the tax tracks under Section 102 do not comply with the requirement of such tax route, the grant shall
be considered subject to the Income Tax Track Without a Trustee, or Section 3(i) or Section 2 of the Tax Ordinance, as applicable, and
the Participant irrevocably waives any claim and/or demand it has or may have with respect to the tax treatment of the Option.

 

    12

     

    

 

17. Withholding
Taxes.

 

(a) Whenever an amount with
respect to withholding tax relating to Options granted to a Participant and/or Underlying Shares issued upon the exercise thereof is due
from the Participant and/or the Company and/or an Affiliate, the Company and/or an Affiliate and/or the Trustee shall have the right to
demand from a Participant such amount that would be sufficient to satisfy any applicable withholding tax requirements related thereto,
and whenever Shares or any other non-cash assets are to be delivered pursuant to the exercise of an Option and the sale of Underlying
Shares, or transferred thereafter, the Company and/or an Affiliate and/or the Trustee shall have the right to require the Participant
to remit to the Company and/or to the Affiliate, or to the Trustee an amount in cash sufficient to satisfy any applicable withholding
tax requirements related thereto, and if such amount is not timely remitted, the Company and/or the Affiliate and/or the Trustee shall
have the right to withhold or set-off (subject to Applicable Law) such Shares or any other non-cash assets pending payment by the Participant
of such amounts.

 

(b) In any case where a tax
is required to be withheld in connection with the delivery of Shares of the Company or of an Affiliate under the Plan, the Administrator
may at its sole discretion (subject to Applicable Law) grant (either at the time of the grant or thereafter) to a Participant the right
to elect, pursuant to such rules and subject to such conditions as the Administrator may establish, that: (i) the Company reduce the number
of Shares to be delivered by (or otherwise reacquire from the Participant) the appropriate number of Shares, valued in a consistent manner
at their Fair Market Value or at the sales price in accordance with authorized procedures for cashless exercises, necessary to satisfy
the minimum applicable withholding obligation on exercise, vesting or payment; or (ii) have the Company withhold from proceeds of the
sale of such Shares (either through a voluntary sale or through a mandatory sale arranged by the Company on the Participant’s behalf)
the minimum amount required to be withheld.(c) Until all taxes have been paid in accordance with Rule 7 of the Section 102 Rules or any
other Applicable Law, Options and/or Underlying Shares may not be sold, transferred, assigned, pledged, encumbered, or otherwise willfully
hypothecated or disposed of, and no power of attorney or deed of transfer, whether for immediate or future use may be validly given. Notwithstanding
the foregoing, the Options and the Underlying Shares may be validly transferred upon the death of a Participant in accordance with Section
19 of this Plan, provided that the transferee thereof shall be subject to the provisions of Section 102 and the Section 102 Rules
as would have been applicable to the deceased Participant in the event he/she would have survived.

 

18. No
Transfer of Options. The Trustee shall not transfer Options to any third party, including a 102 Participant, except in accordance
with instructions received from the Administrator.

 

19. Transfer
of Rights Upon Death. No transfer of any Option or Underlying Share issued upon the exercise thereof by will or by the laws
of descent shall be effective to bind the Company unless the Company shall have been furnished with all of the following signed and notarized
documents: (i) a written request for such transfer and a copy of the legal documents creating and confirming the right of the person acting
with respect to the Participant’s estate and of the transferee; (ii) written consent by the transferee to pay any payment due according
to the provisions of the Plan and otherwise comply by all the terms of the Plan; and (iii) any such other evidence as the Administrator
may deem necessary to establish the right to the transfer of the Granted Options or Underlying Shares issued upon the exercise thereof
and the validity of the transfer.

 

    13

     

    

 

20. No
Right of Others to Options. Subject to the provisions of the Plan, no person other than the Participant shall have any right
with respect to Options granted to the Participants under the Plan.

 

21. Expenses
and Receipts. The expenses incurred in connection with the administration and implementation of the Plan (including any applicable
stamp duty) shall be borne by the Company. Any proceeds received by the Company in connection with the exercise of any Option may be used
for general corporate purposes.

 

22. Required
Approvals. The Plan is subject to the receipt of all approvals required under the Applicable Law including under the Tax Ordinance.

 

23. Treatment
of Participants. There is no obligation for uniformity of treatment of Participants.

 

24. No
Conflicts. In the event of any conflict between the terms of the Plan and the Grant Letter, the Plan shall prevail, unless
the Grant Letter stated specifically that the conflicting provision in the Grant Letter shall prevail.

 

25. Participant
Undertakings. By entering into this Plan, the Participant shall: (i) agree and acknowledge that he or she have received and
read the Plan, the Grant Letter and the Trust Agreement; (ii) undertake all the provisions set forth in Section 3(i) or Section 102 as
applicable (including provisions regarding the applicable Tax Track that the Company has elected), the Plan, the Grant Letter and the
Trust Agreement (if applicable); (iii) sign any required documentation, including but not limited, an irrevocable power of attorney and
proxy; and (iv) to the extent the Options are granted under Section 102, the 102 Participant shall undertake that subject to the provisions
of Section 102 and the Section 102 Rules, he/she shall not sell or release the Options or Underlying Shares from trust before the end
of the Holding Period (if any).

 

26. Governing
Law and Jurisdiction. This Plan shall be governed by and construed and enforced in accordance with the laws of the State of
Israel, without giving effect to its principles of conflict of laws. The competent courts of Tel-Aviv, Israel shall have sole jurisdiction
in any matters pertaining to this Plan.

 

27. Non-Exclusivity
of the Plan. The adoption of this Plan by the Board shall not be construed as amending, modifying or rescinding any previously
approved incentive arrangements or imposing any limitations on the power of the Board to adopt other incentive arrangements as it may
deem desirable, including, without limitation, the granting of shares or options otherwise than under this Plan.

 

* * * * *

 

 

14Document

RESTRICTIVE COVENANT AGREEMENT

This Restrictive Covenant Agreement (this “Agreement”) is dated as of [INSERT], 2022, and is by and between Schweitzer-Mauduit International, Inc. (the “Company,” and, together with its Affiliates, the “Company Group”) and [INSERT] (“Employee”).  

    The Company Group has expended significant time, effort and resources to develop and protect its trade secrets and other confidential information, its relationships with current and prospective customers, vendors, suppliers, and other business relations, its goodwill associated with its Business, and its investment in recruiting and training its employees. Employee acknowledges that the nature of Employee’s position with the Company Group (i) gives Employee access to the Company Group’s trade secrets and confidential information, and (ii) exposes Employee to and allows Employee to develop relationships with the Company Group’s current and prospective customers, vendors, suppliers, and other business relations.  Employee further acknowledges that the Company Group would be irreparably harmed if such information and relationships were used to unfairly compete with the Company Group. 

    Therefore, in consideration of Employee’s employment with the Company Group, access to Trade Secrets, Confidential Information, customer and other business relationships, the 2022 awards under the Schweitzer-Mauduit International, Inc. 2015 Long-Term Incentive Plan, including the annual grants and any additional retention grants,  and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties, intending to be legally bound, hereby agree as follows. This Agreement does not change Employee’s “at will” status with the Company Group, meaning that either Employee or the Company Group may terminate Employee’s employment at any time and for any reason, with or without cause.

1.Definitions.  As used in this Agreement, the following terms have the following meanings:

a.“Affiliate” means, with respect to any specified Person other than a natural person, any other Person that, directly or indirectly, has the power to direct the management and policies of such specified Person whether through the ownership of voting securities, by contract or otherwise, including, without limitation, each of such specified Person’s subsidiaries.  
b.“Business” means the: (i) production of performance nets, films and non-wovens, as well as related coatings and adhesives, with applications in Company Group’s key growth areas which include surface protection, filtration and healthcare contract manufacturing and (ii) production of cigarette papers and reconstituted tobacco products for cigarette and cigar manufacturers, as well as the processing of various other non-tobacco natural fibers such as cocoa paper and industrial hemp for applications commercialized by the Company Group..
c.“Confidential Information” means information, regardless of form, belonging to the Company, licensed by it, or disclosed to it on a confidential basis by its customers, suppliers, or other third parties, other than Trade Secrets, which is material and valuable to the Company and not generally known by the public.
d.“Intellectual Property Rights” means any rights of ownership, including, but not limited to, all rights of patent, trademark, service mark, trade secret, copyright and copyright renewal, rental, lending and/or fixation.
e.“Person” means any individual, firm, corporation, partnership, limited liability company, incorporated or unincorporated association, joint venture, joint stock company, governmental agency or instrumentality or other entity of any kind.
f.“Prohibited Territory” means anywhere in the United States or any other country in which the Company Group operates or licenses its rights for a third party to operate or any country which the Company Group is actively considering operating in or licensing the rights in such other country and in which you performed services, or with respect to which you had 
1
WORKAMER\39970252.v2

material responsibility, oversight or business contacts, on behalf of the Company Group within the two year period immediately preceding your relevant conduct. 
g.“Trade Secrets” means confidential, non-public information, regardless of form, belonging to the Company Group, licensed by it, or disclosed to it on a confidential basis by its customers, suppliers, or other third parties, including, but not limited to, technical or nontechnical data, formulae, strategies, software programs, compilations, programs, devices, methods, techniques, drawings, processes, financial data or plans, product plans, or lists of actual or potential customers or suppliers that: (i) derive economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons or entities who can obtain economic value from their disclosure or use; and (ii) are the subject of efforts that are reasonable under the circumstance to maintain their secrecy. To the extent that the foregoing definition is inconsistent with a definition of “trade secret” mandated under applicable law, the latter definition shall govern for purposes of interpreting your obligations under this Agreement.
h.“Work Product” means any concepts, methods of operation, processes, programs, coding, designs (including, but not limited to, machines, processes, articles of manufacture, compositions of matter, computer programs, and business methods), audio visual works, graphics, property, data, inventions, discoveries, innovations, creations, original works of authorship, trademarks or service marks (and all goodwill associated therewith), documentation, information, materials, or refinements or improvements of any of the foregoing, prepared, conceived, discovered, developed, modified, worked on, reduced to practice, or created by you, alone or together with others, in connection with performing any of your employment responsibilities during your employment with the Company Group.  
2.Limitation on Competition; Non-Disparagement.

a.Limitation on Competition.  You acknowledge that the Company Group is engaged in highly competitive businesses, including the Company’s Business, and have compelling business interests in preventing the use or disclosure of its Confidential Information and Trade Secrets, and that you, by virtue of your position, will have access to Confidential Information and Trade Secrets. Accordingly, you agree that while you are employed by the Company Group, and for the two (2) years after the effective date of termination of your employment with the Company Group you shall not, either directly or indirectly, alone or in conjunction with any other person or legal entity (other than the Company Group), perform any duties or services that are substantially similar to or the same as those which you performed for the Company Group for any person or business that substantially competes with the Company Group in the Business within the Prohibited Territory.  For the avoidance of doubt, the post-employment restrictions in this Section 2(a) shall not apply to persons or businesses that do not directly compete against the Company Group with respect to the Business and shall not apply to any services performed after the effective date of termination of your employment with the Company Group solely as a board member or in an immaterial consulting or advisory role unless such services would necessarily require the use or disclosure of the Company Group’s Trade Secrets and/or Confidential Information. 
b.Non-Disparagement.  You agree that while you are employed by the Company Group and for the two (2) years after the effective date of termination of your employment with the Company Group for any reason, you shall not, either directly or indirectly, make any written or oral disparaging statements regarding the Company, any other member of the Company Group, or any of their respective officers, directors, employees, agents, contractors, vendors, customers, clients, licensees, members, shareholders or financiers.
3.Limitation on Soliciting Personnel and Customers.  You agree that, except to the extent that you are required to do so in connection with your employment responsibilities herein or except with the Company Group’s prior written permission, while you are employed by the Company Group, and for the two (2) years after the effective date of termination of your employment with the Company Group, you shall not, either directly or indirectly, alone or in conjunction with any other party and/or entity, 
2

recruit, induce or solicit to become employed by, engage in a business, or conduct business with a business that competes with the Company Group, any third party person or entity who is an employee, customer or business relationship of any member of the Company Group. 

4.Non-Disclosure Covenant.  You acknowledge that as an integral part of the Company’s Business, the Company Group has developed, and will develop, at a considerable investment of time and expense, marketing and business plans and strategies, procedures, methods of operation and marketing, financial data, technical procedures, plans for development and expansion, and other confidential and sensitive information, and you acknowledge that the Company Group has a legitimate business interest in protecting the confidentiality of such information. You acknowledge that you will be entrusted with such information as well as confidential information belonging to customers, suppliers, and other third parties.  You therefore acknowledge a continuing responsibility to protect such information and agree:
  
a.You will treat as confidential and will not, without the prior written approval of the Company, use (other than in the performance of duties of employment with the Company Group), publish, disclose, patent, copyright, or authorize anyone else to use, publish, disclose, patent, or copyright: (i) Trade Secrets either during your employment or subsequent thereto; or (ii) any Confidential Information either during your employment or for two (2) years after the effective date of termination of your employment with the Company Group. Nothing in this Agreement limits, restricts or in any other way affects your ability to communicate with any governmental agency or entity, or communicating with any official or staff person of a governmental agency or entity, with respect to any potential violation of law relevant to the governmental agency or entity, or requires you to furnish prior notice to the Company of the same. Additionally, please be advised that, under the Defend Trade Secrets Act: (i) no individual will be held criminally or civilly liable under federal or state trade secret law for disclosure of a trade secret (as defined in the Economic Espionage Act) that is: (A) made in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and made solely for the purpose of reporting or investigating a suspected violation of law; or, (B) made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal so that it is not made public; and (ii) an individual who pursues a lawsuit for retaliation by an employer for reporting a suspected violation of the law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal, and does not disclose the trade secret, except as permitted by court order.
b.The Company recognizes that you, as a former employee or independent contractor of another company, may previously have been privy to trade secrets and/or confidential information of such other company, and you may be under an obligation to such other company to maintain the confidentiality of such trade secrets or confidential information.  Accordingly, to the extent you are under such an obligation, you shall not: (i) bring any records, notes, files, drawings, documents, plans and like items, provided to you in confidence by such other company, or any copies thereof, relating to or containing or disclosing confidential information or trade secrets of any such other company on the premises of the Company Group or otherwise use such documents and items in the performance of services for the Company Group; or (ii) disclose any confidential information or trade secrets provided to you in confidence by such other company to any other employee of the Company Group; provided, however, that this prohibition only applies to documents or information that you obtained or learned before the beginning of your employment with the Company Group.
5.Return of Work Product and Company Property.  At any point during your employment, at the specific request of the Company Group, or, in any event, as promptly as practicable after your employment with the Company Group has been terminated, you will return to the Company Group all Work Product and all data, lists, information, memoranda, notes, records, reports, files, rolodexes and documents belonging to the Company Group (including any copies or reproductions thereof, in any form, and any materials constituting or containing Trade Secrets or Confidential Information of the Company Group) and all Company Group-provided credit cards, keys, building passes, security passes, access or identification cards, laptop or other computers, other computer equipment, portable e-mail devices, telephones, computer software, and all other property of the Company Group that are in your possession or control.  You agree that, by your last day of work, you will clear all expense accounts, repay 
3

everything you may owe to the Company Group, and pay all amounts you may owe on the Company Group provided credit cards or accounts (such as cell phone accounts).

6.Acknowledgment.  The parties acknowledge and agree that the covenants contained in Sections 2, 3, 4, and 5 of this Agreement are reasonable as to time, scope and territory given the Company Group’s need to protect its substantial investment in its Confidential Information, Trade Secrets, employment relationships, and customer relationships, and particularly given (a) the generous compensation and benefits that are to be provided to you, (h) the Company Group’s investment of time, effort and capital in enhancing your business skills and opportunities, (c) the complexity and competitive nature of the Company Group, and (d) that you have sufficient skills to find alternative, commensurate employment or consulting work in your field of expertise that would not entail a violation of Sections 2, 3, 4, and 5 of this Agreement. So that the Company Group may enjoy the full benefit of the covenants referenced in this Section 6, you further agree that the restricted period set forth in each such covenant shall be tolled, and shall not run, during the period of any breach by you of any of the covenants referenced in this Section 6. You and the Company further agree that, in the event that any provision of any of the covenants referenced in this Section 6 is determined by any court of competent jurisdiction to be unenforceable by reason of its being extended over too great a time, too large a geographic area or too great a range of activities, that provision shall be deemed to be modified to permit its enforcement to the maximum extent permitted by law. It is also agreed that each member of the Company Group shall have the right to enforce all of your obligations to such member of the Company Group under this Agreement, including without limitation pursuant to this Section 6.

7.Cooperation.  
a.You agree to reasonably cooperate with the Company Group in the defense or prosecution of any claims or actions asserted by or made against any member of the Company Group, their respective current or former parents, predecessors in interest, subsidiaries or affiliates, or any of their respective current or former officers, directors, trustees, shareholders, employees, agents, attorneys, successors or assigns. Such reasonable cooperation may include, but is not limited to, your consultation with the Company Group or its counsel and your attendance as a witness at depositions, trials or similar proceedings and providing sworn statements and/or testimony in connection therewith.
b.Without limiting the forgoing, you agree not to discuss any ongoing or anticipated legal proceedings (or any facts, or prospective or actual testimony in connection therewith) with, or to provide documents pertaining thereto to, any person employed by or engaged to provide services to the Company Group or any other person, or otherwise communicate with such individual with respect to such matters, unless you have been expressly authorized to do so in advance by the Company Group’s legal counsel or otherwise compelled to do so under a lawfully issued subpoena, administrative order or order of court of competent jurisdiction.  Prior to responding thereto, you agree to promptly inform the Company of the issuance of any such subpoena or order and to reasonably cooperate with the Company Group’s counsel (consistent you’re your obligations under law) if the Company Group elects to challenge the issuance thereof.
c.Both you and the Company hereby acknowledge that your obligations under this Section 7 shall be subject to your compliance with your legal obligations in any such proceeding including, without limitation, your obligation to provide truthful testimony.
d.You acknowledge and understand that your obligation to reasonably cooperate will continue beyond the termination of your engagement by the Company Group as an employee or independent contractor.  The Company will provide you reasonably compensation for any cooperation that occurs after you are no longer performing services for the Company and an hourly rate consistent with your rate of pay on the effective date of termination of your employment with the Company Group.
8.Remedies.  Notwithstanding anything to the contrary in this Agreement and to the extent permitted by applicable law, in the event of a breach by you of any provision of this Agreement, the 
4

Company Group shall have the right to set off against any sums Company Group owes you the amount of any damages incurred or suffered by the Company Group as result of the breach, including all outstanding awards under the Schweitzer-Mauduit International, Inc. 2015 Long-Term Incentive Plan and the amounts and benefits provided under the Schweitzer-Mauduit International, Inc. 2016 Executive Severance Plan.  Any such set-off shall not be presumed to be in full satisfaction of or as liquidated damages for or as a release of any claim or damages against you that may accrue to the Company Group as a result of the breach.  You acknowledge that the services to be rendered by you to the Company Group are of a unique, unusual, special and extraordinary nature, and of a peculiar value, the loss of which cannot be reasonably or adequately compensated in damages in any action at law, and that any breach or threatened breach of Sections 2, 3, 4, and 5 hereof by you is likely to result in irreparable injury to the Company Group. Therefore, in addition to all remedies provided at law or in equity (which remedies shall be cumulative and not mutually exclusive), you agree that the Company Group shall be entitled to file suit in a court of competent jurisdiction to seek a temporary restraining order and a permanent injunction to prevent a breach or threatened breach of such Sections.  The existence of any claim, demand, action or cause of action that you may have against the Company Group, whether predicated upon this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company Group of any of your obligations under this Agreement.

9.Arbitration.  With the exception of the claims set forth below, to the fullest extent permitted by law, you and the Company agree that any and all legal disputes or claims arising out of or relating to your employment or the termination of your employment with the Company Group shall be settled exclusively by final and binding arbitration before a neutral third-party arbitrator in accordance with this provision.  This arbitration agreement applies to, among other things and without limitation, disputes about the validity, interpretation, or effect of this Agreement or alleged violations of it, any claim under federal, state or local statute, regulation or common law doctrine regarding employment discrimination, conditions of employment or termination of employment.  Except as limited below, arbitration shall apply to any and all such legal disputes whether asserted against the Company, any other member of the Company Group, and/or any of their officers, alleged agents or managers, directors or other representatives.

    The only claims that are arbitrable are those that, in the absence of this Agreement, would have been justifiable under applicable federal, state or local law. In addition, claims for state employment insurance (e.g., unemployment compensation, worker’s compensation, worker disability compensation) or claims under the National Labor Relations Act shall not be subject to arbitration.  Statutory or common law claims alleging that the Company Group retaliated or discriminated against you for filing a state employment insurance claim, however, shall be subject to arbitration.  Further, arbitration does not apply and nothing in this Agreement shall prohibit the Company Group from seeking injunctive and/or other equitable relief to protect its business interests (e.g., without limitation, claims alleging violations of Sections 2, 3, 4, or 5 of this Agreement or other claims relating to confidentiality, trade secrets, non-competition, tortious interference with contract or business relations) or as necessary to protect the health, safety and general welfare of its employees.

    A demand for arbitration shall be made within a reasonable time after the claim has arisen.  In no event shall the demand for arbitration be permitted after the date when institution of legal or equitable proceedings based on such claim would be barred by the applicable statute of limitations (or, with regard to a claim of discrimination or harassment for which you choose to file a charge of discrimination with a local, state or federal administrative agency, after the expiration of the notice period provided by the law governing your claim).  The arbitrator shall not conduct class arbitration, meaning that you have no right to demand to arbitrate a claim in a representative capacity or to participate as a member of a class of claimants against the Company Group, unless such class action arbitration is otherwise mandated as a matter of law.

    Arbitration shall take place under the JAMS Employment Arbitration Rules & Procedures in Atlanta, before an experienced employment arbitrator licensed to practice law in Georgia, who has been selected in accordance with such Rules & Procedures.  The arbitrator may not modify or change this Agreement in any way.  The arbitrator shall have jurisdiction to hear and rule on pre-hearing disputes and is authorized to hold pre-hearing conferences by telephone or in person, as the arbitrator deems necessary.  The arbitrator shall have the authority to entertain a motion to dismiss and/or a motion for summary judgment by any party and shall apply the standards governing such motions under the Federal Rules of 
5

Civil Procedure, and is required to issue written opinions for both motions and final rulings of arbitration, which shall state the essential findings and conclusions upon which the decision or ruling is based.

    Each party shall pay the fees of the attorneys, the expenses of witnesses, and any other expenses that party incurs in connection with the arbitration, but all other costs of the arbitration, including the fees of the arbitrator, the cost of any record or transcript of the arbitration, administrative fees, and other fees and costs shall be paid by the Company Group, except that in arbitrations initiated by you,  you shall pay a portion of such fees that is equal to the applicable filing fee you would have to pay had you proceeded in a court filing; and, attorneys’ fees will be awarded in accordance with the applicable statutory provisions.

    Arbitration in this manner shall be the exclusive remedy for any claim that must be arbitrated pursuant to this Section.  Should you or the Company attempt to resolve such a claim by any method other than arbitration pursuant to this Section, the responding party will be entitled to recover from the initiating party all available damages, expenses, and attorneys’ fees incurred as a result of that breach.  The provisions contained in this Section 9 shall survive the termination and/or expiration of this Agreement.  If any portion of this provision is held to be invalid, then it shall be considered void, but the remaining portions of this provision shall be enforceable.

    The parties indicate their acceptance of the foregoing arbitration provision by initialing below:

    ____________________        ________________________
    For the Company            Employee

10.No Conflicts; Notification.  You represent and warrant that your performance of all the terms of this Agreement, and the performance of your duties as an employee of the Company Group, do not and will not breach any agreement between you and any other Person, including any prior employer. You agree to notify any subsequent employer of the existence and terms of this Agreement.  In addition, you authorize the Company Group to provide a copy of this Agreement to third parties, including but not limited to your subsequent, anticipated, or possible future employers.

11.Assignment.  Employee may not assign or delegate this Agreement or any of his or her rights or obligations hereunder without the prior written consent of the Company. Any purported assignment by Employee in violation of this provision shall be null and void from the time of such purported assignment.  The Company may assign this Agreement or any or all of its rights and interests hereunder to one or more of its Affiliates or to any successor to all or substantially all of the business and/or assets of the Company.  Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective permitted successors and assigns.  

12.Miscellaneous.  

a.Binding Effect; Assignment.  This Agreement shall inure to the benefit of and shall be binding upon you and your executor, administrator, heirs, personal representative and assigns, and the Company and its successors and assigns; provided, however, neither party hereto shall be entitled to assign this Agreement or any of its rights, or delegate any of its duties hereunder without the written consent of the other party (except, in your case, customary delegation of authority not inconsistent with this Agreement; and except, in the case of the Company, to any other member of the Company Group or any person or entity acquiring all or substantially all of the assets of the Company or to any entity controlling, controlled by or under common control with the Company).  Notwithstanding any provision of this Agreement to the contrary, neither the assignment of a different reporting officer, due to a reorganization or an internal restructuring of the Company Group or its subsidiaries or affiliates or otherwise, nor an assignment by the Company of this Agreement to another member of the Company Group or any of their respective subsidiaries or Affiliates shall constitute a modification or a breach of this Agreement.
6

b.Governing Law.  This Agreement shall be deemed to be made in, and in all respects shall be interpreted, construed and governed by and in accordance with, the laws of the State of Georgia, without regard to its conflict of laws principles or provisions.  The parties hereto agree that the state or federal courts in the State of Georgia shall have personal jurisdiction over them with respect to all matters arising from or with respect to this Agreement.  Such courts shall be the exclusive forum for the resolution of any matter or controversy arising from or with respect to Sections 2, 3, 4, or 5 of this Agreement and for any action to enforce or challenge results of an arbitration proceeding brought under the provisions of this Agreement.
c.Headings.  The section and subsection headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
d.Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.
e.Entire Agreement.  This Agreement is intended by the parties to be the final expression of their agreement with respect to the subject matter hereof, is the complete and exclusive statement of the terms thereof, and supersedes any representations, statements or agreements to the contrary heretofore made.  This Agreement may be modified only by a written instrument signed by each of the parties hereto; without limiting the foregoing, the parties acknowledge and agree that this Agreement may not be modified electronically, by email exchange or otherwise, even if the electronic communication is accompanied by the typed name of the sender, an electronic signature, or signature block. 
f.Severability.  All provisions of this Agreement are severable from one another, and the unenforceability or invalidity of any provision of this Agreement shall not affect the validity or enforceability of the remaining provisions of this Agreement; provided, however, that should any judicial body interpreting this Agreement deem any provision to be unreasonably broad in time, territory, scope or otherwise, the Company and you intend for the judicial body, to the greatest extent possible, to reduce the breadth of the provision to the maximum legally allowable parameters rather than deeming such provision totally unenforceable or invalid.
g.Waiver.  The waiver by either the Company or you of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any prior or subsequent breach of the same provision by the other party or a waiver of a breach of another provision of this Agreement by the other party.  No waiver or modification of any provision of this Agreement shall be valid unless in writing and duly executed by the party to be charged with the waiver or modification.  Without limiting the generality of the foregoing, the parties acknowledge and agree that no provision of the Agreement may be waived or modified electronically, by email exchange or otherwise, even if the electronic communication is accompanied by the typed name of the sender, an electronic signature, or signature block of the party to be charged with the waiver or modification.

7

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date(s) indicated below to be effective as of the date stated in the preamble.

SCHWEITZER-MAUDUIT INTERNATIONAL, INC.    [INSERT]

By:        ____________________________________
Name:        [INSERT]
Title: 

                            ____________________________________
Date        Date

8

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00339-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00339-of-00352.parquet"}]]