Document:

Exhibit 10.2

 

EXECUTION
VERSION

 

June 9, 2022

 

Hillenbrand, Inc.

One Batesville
Boulevard

Batesville, IN 47006

 

Re:         Amendment
No. 8 to Private Shelf Agreement

 

Ladies and Gentlemen:

 

Reference is made to the Private
Shelf Agreement, dated as of December 6, 2012 (as amended by Amendment No. 1 dated as of December 15, 2014, Amendment No. 2
dated as of December 19, 2014, Amendment No. 3 dated as of March 24, 2016, Amendment No. 4 dated as of December 8,
2017, Amendment No. 5 dated as of September 4, 2019, Amendment No. 6 dated as of January 10, 2020 and Amendment No. 7
dated as of May 19, 2020, the “Note Agreement”), by and among Hillenbrand, Inc., an Indiana corporation (the
“Company”), PGIM, Inc. (f/k/a Prudential Investment Management, Inc.) (“Prudential”) and
each Prudential Affiliate (as therein defined) that has become or becomes bound thereby. Capitalized terms used herein that are not otherwise
defined herein shall have the meaning specified in the Note Agreement.

 

The Company has requested
that the Required Holders agree to amend the Note Agreement, as more particularly described below. Subject to the terms and conditions
hereof, the Required Holders are willing to agree to such request.

 

Accordingly, in accordance
with the provisions of Section 18.1 of the Note Agreement, and in consideration of the foregoing and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

SECTION 1.   Amendments
to the Note Agreement. Upon the occurrence of the Effective Date (as defined below), the
Note Agreement shall be amended as set forth below:

 

1.1            Section 9.1(c)(iii) of
the Note Agreement is hereby amended and restated in its entirety to read as follows:

 

(iii) stating whether any change
in GAAP or in the application thereof has occurred since the date of the Company’s audited financial statements for the fiscal year
ended September 30, 2021 or the Company’s quarterly financial statements for the fiscal quarter ended December 31, 2021
and March 31, 2022 delivered pursuant to this Agreement and, if any such change has occurred, specifying the effect of such change
on the financial statements accompanying such certificate;

 

    

     

    

 

1.2           Section 9.2
of the Note Agreement is hereby amended by (i) renumbering clauses (c) and (d) thereof to be clause (d) and (e),
respectively, (ii) inserting a new clause (c) to read as follows:

 

(c)           the
occurrence of any of the following to the extent the same would reasonably be expected to result in a Material Adverse Effect (x) the
threatened in writing or actual issuance by the Pensions Regulator of a financial support direction or a contribution notice (as those
terms are defined in the United Kingdom Pensions Act 2004) or the threatened in writing or actual exercise of any Criminal Pension Power
by the Pensions Regulator or the CPS in relation to the Milacron Pension Scheme and/or (y) any amount becoming due to the Milacron
Pension Scheme pursuant to Section 75 or 75A of the United Kingdom Pensions Act 1995;

 

and (iii) amending and
restating the first sentence of the paragraph following clause (e) to read as follows:

 

Each notice delivered
under the Section (i) shall contain a heading or a reference line that reads “Notice under Section 9.2 of the Private
Shelf Agreement dated December 6, 2012” and (ii) shall be accompanied by a statement of a Senior Financial Officer or
other executive officer of the Company setting forth the details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.

 

1.3           Section 10.1
of the Note Agreement is hereby amended by (i) amending and restating clause (v) thereof in its entirety to read as follows:

 

(v)            Liens
arising out of Sale and Leaseback Transactions;

 

and (ii) deleting clause
(bb) thereof in its entirety and renumbering clause (cc) thereof to be clause (bb).

 

1.4           Section 10.2
of the Note Agreement is hereby amended and restated in its entirety to read as follows:

 

Section 10.2     Acquisitions

 

The Company will
not, and will not permit any Subsidiary to, acquire (in one or a series of transactions) all of the capital stock or equity interests
or all or substantially all of the assets of any Person, unless (i) immediately before and after giving effect thereto, no Default
or Event of Default shall have occurred and be continuing or would result therefrom and (ii) if the aggregate amount invested (including
assumed debt) is greater than $375,000,000, relevant financial information, statements and projections reasonably requested by the Required
Holders in respect of the Company and its Subsidiaries as of the end of the most recent fiscal quarter for the four fiscal quarters most
recently ended giving effect to the acquisition of the company or business pursuant to this Section 10.2 are delivered to Prudential
and the holders of Notes that are Institutional Investors not less than five (5) Business Days prior to the consummation of any such
acquisition or series of acquisitions, together with a certificate of a Responsible Officer of the Company demonstrating pro forma compliance
with Section 10.9 after giving effect to such acquisition or series of acquisitions.

 

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1.5            Section 10.3
of the Note Agreement is hereby amended by (i) deleting each reference to “capital leases” contained in clause (d) thereof
and inserting “finance leases” in lieu thereof, (ii) amending and restating clause (f) thereof in its entirety to
read as follows:

 

(f)           so
long as no Default or Event of Default has occurred and is continuing or would result therefrom at the time of incurrence, any other unsecured
Indebtedness of (x) the Company or any Guarantor and (y) any Foreign Subsidiary Borrower (other than, for the avoidance of doubt,
any Indebtedness of a Foreign Subsidiary under the Primary Credit Facility), in the case of clause (y), in an aggregate outstanding principal
amount not to exceed the lesser of (A) the Foreign Subsidiary Debt Limit and (B) the greater of (i) $200,000,000 and (ii) 20%
of Consolidated Tangible Assets (calculated as of the end of the immediately preceding fiscal quarter for which the Company’s financial
statements were most recently delivered pursuant to Section 9.1(a) or (b)); provided that, in each case, such Indebtedness
is not senior in right of payment to the payment of the Indebtedness arising under this Agreement, the Notes, and the Transaction Documents;

 

and (iii) amending and
restating clause (i) thereof in its entirety to read as follows:

 

(i)            [reserved];

 

1.6           Section 10.8(d) of
the Note Agreement is hereby amended and restated in its entirety to read as follows:

 

(d)           [reserved];

 

1.7            Section 10.9(a) of
the Note Agreement is hereby amended and restated in its entirety to read as follows:

 

(a)           Maximum
Leverage Ratio. The Company will not permit the ratio (the “Leverage Ratio”), determined as of the last day of
each of its fiscal quarters ending on and after June 30, 2022, of (i) (x) Consolidated Indebtedness minus (y) the
Liquidity Amount, in each case as of the last day of such fiscal quarter to (ii) Consolidated EBITDA for the period of four consecutive
fiscal quarters ending with the last day of such fiscal quarter, all calculated for the Company and its Subsidiaries on a consolidated
basis, to be greater than 3.50 to 1.00; provided that the Company may, by written notice to the holders of Notes (which notice
may be in a compliance certificate delivered pursuant to Section 9.1(c) with respect to an applicable fiscal quarter) and not
more than twice during the term of this Agreement, elect to (x) increase the maximum Leverage Ratio to 4.00 to 1.00 for a period
commencing with the fiscal quarters in which the applicable acquisition occurs and the four consecutive fiscal quarters ending thereafter
in connection with an acquisition that involves the payment of consideration by the Company and/or its Subsidiaries in excess of
$75,000,000 occurring during the fiscal quarters in which the applicable acquisition occurs (each such period, an “Adjusted Covenant
Period”) and (y) notwithstanding the foregoing clause (x), the Company may not elect an Adjusted Covenant Period for at
least two full fiscal quarters following the end of an Adjusted Covenant Period before a new Adjusted Covenant Period is available again
pursuant to the preceding clause (x) for a new period commencing with the fiscal quarter in which the applicable acquisition occurs
and the four consecutive fiscal quarters ending thereafter. For purposes of calculations under this Section 10.9(a), Consolidated
Indebtedness shall not include 75% of the principal amount of any mandatorily convertible unsecured bonds, debentures, preferred stock
or similar instruments in a principal amount not to exceed $500,000,000 in the aggregate during the term of this Agreement which are payable
in no more than three years (whether by redemption, call option or otherwise) solely in common stock or other common equity interests.

 

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1.8            Section 10.9(b) of
the Note Agreement is hereby amended and restated in its entirety to read as follows:

 

(b)           Minimum
Interest Coverage Ratio.    The Company will not permit the
ratio (the “Interest Coverage Ratio”), determined as of the last day of each of its fiscal quarters ending on and after June 30,
2022, of (i) Consolidated EBITDA to (ii) Consolidated Interest Expense, in each case for the period of four consecutive fiscal
quarters ending with the last day of such fiscal quarter, all calculated for the Company and its Subsidiaries on a consolidated basis,
to be less than 3.00 to 1.00.

 

1.9            The
Note Agreement is hereby amended to insert a new Section 10.12 thereto, which shall read as follows:

 

Section 10.12.     UK
Pensions.

 

The Company will
ensure it is not knowingly (including where it ought reasonably to know it is) a party, and will use best endeavors to procure that no
Subsidiary is a party, to any act or omission in relation to the Milacron Pension Scheme which has or is reasonably likely to have a Material
Adverse Effect (including, without limitation, in relation to the issuance of a contribution notice or financial support direction by
the Pensions Regulator for the purposes of the United Kingdom Pensions Act 2004 or the exercise of any Criminal Pension Power by the Pensions
Regulator or CPS).

 

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1.10         Section 11
of the Note Agreement shall be amended to (i) renumber clauses (m) and (n) thereto to be clause (n) and (o), respectively
and (ii) insert a new clause (m) thereto, which shall read as follows:

 

(m)            the
Company or any of its Subsidiaries shall have been notified that any of them has, in relation to the Milacron Pension Scheme, incurred
a debt or other liability under section 75 or 75A of the United Kingdom Pensions Act 1995, or has been issued with a contribution notice
or financial support direction (as those terms are defined in the United Kingdom Pensions Act 2004) or has been subject to the exercise
of any Criminal Pension Power, or otherwise is determined by a Governmental Authority to be liable to pay any other amount in respect
of the Milacron Pension Scheme, in each case that would reasonably be expected to result in a Material Adverse Effect;

 

1.11         The
second paragraph of Section 23.3 of the Note Agreement is hereby amended and restated in its entirety to read as follows:

 

Notwithstanding
anything to the contrary herein all terms of an accounting or financial nature used herein shall be construed, and all computations of
amounts and ratios referred to herein shall be made, (x) without giving effect to any election by the Company or any Subsidiary to
measure any portion of a financial liability at fair value (as permitted by Accounting Standards Codification 825, formerly known as statement
of Financial Accounting Standards No. 159, or any similar accounting standard) and such determination shall be made as if such election
had not been made and (y) without giving effect to any treatment of Indebtedness under Accounting Standards Codification 470-20 or
2015-03 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any
such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full
stated principal amount thereof, net of discounts and premiums.

 

1.12          Section 23.4
of the Note Agreement is hereby amended by replacing “equity interests” with “Equity Interests”.

 

1.13          Schedule
B to the Note Agreement is hereby amended to delete the following definitions in their entirety:

 

“Airport
Access and Use Agreement”

 

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“Bengal”

 

“Bengal
Acquisition”

 

“Bengal
Acquisition Agreement”

 

“Bengal
Holding”

 

“Farm Agreement”

 

“Joint
Ownership Agreements”

 

“Specified
Senior Notes”

 

“Specified
Senior Notes Indebtedness”

 

“Specified
Senior Notes Indenture”

 

1.14         Schedule
B to the Note Agreement is hereby amended to amend and restate or add, as applicable, the following definitions:

 

“Amendment
No. 8” means that certain Amendment No. 8 to Private Shelf Agreement dated as of June 9, 2022.

 

“Amendment
No. 8 Effective Date” means the “Effective Date” as defined in Amendment No. 8.

 

“Attributable
Indebtedness” means, on any date, in respect of any finance lease of any Person, the capitalized amount thereof that would appear
on the balance sheet of such Person prepared as of such date in accordance with GAAP; provided that in no event shall an operating lease
be treated as Attributable Indebtedness regardless of whether such obligation appears on a balance sheet in accordance with GAAP.

 

“Change
in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or
group (within the meaning of the Securities Exchange Act of 1934 and the rules of the SEC thereunder as in effect on the date hereof)
other than any member or members of the Hillenbrand Family Group, of Equity Interests representing more than 40% of the aggregate ordinary
voting power represented by the issued and outstanding Equity Interests of the Company or (b) occupation of a majority of the seats
(other than vacant seats) on the board of directors of the Company by Persons who were neither (i) nominated or approved by the board
of directors of the Company nor (ii) appointed by directors so nominated or approved; or (c) the Company ceases to own, directly
or indirectly, and Control 100% (other than (i) directors’ qualifying shares and (ii) shares issued to foreign nationals
to the extent required by applicable law) of the ordinary voting and economic power of any Subsidiary Borrower.

 

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“Consolidated
EBITDA” means, with reference to any period, Consolidated Net Income for such period plus, without duplication, and to the extent
deducted from revenues in determining Consolidated Net Income for such period, (i) interest expense, (ii) income tax expense,
(iii) depreciation expense, (iv) amortization expense, (v) all non-cash expenses, charges or losses, (vi) losses attributable
to the early extinguishment of Indebtedness, (vii) (A) cash fees, costs, expenses, premiums, penalties or other losses incurred
in connection with any acquisition, any asset sale or other disposition, any recapitalization, any investment, any issuance of equity
interests by the Company or any issuance, incurrence or repayment of any Indebtedness by the Company or its Subsidiaries, the amortization
of any deferred financing charges, and/or any refinancing transaction or modification or amendment of any debt instrument (including any
transaction undertaken but not completed) and (B) non-recurring or unusual expenses, charges or losses in an aggregate amount for
clauses (A) and (B) not to exceed ten percent (10%) of Consolidated EBITDA for any Reference Period (as calculated without giving
effect to the add-back of any item pursuant to this clause (vii)) minus, to the extent included in Consolidated Net Income, (1) interest
income, (2) income tax benefits (to the extent not netted from tax expense), (3) any cash payments made during such period in
respect of items described in clause (v) above subsequent to the fiscal quarter in which the relevant non-cash expense, charge or
loss were incurred and (4) gains attributable to the early extinguishment of Indebtedness, all calculated for the Company and its
Subsidiaries in accordance with GAAP on a consolidated basis. For the purposes of calculating Consolidated EBITDA for any period of four
consecutive fiscal quarters (each such period, a “Reference Period”), (i) if at any time during such Reference
Period the Company or any Subsidiary shall have made any Material Disposition, the Consolidated EBITDA for such Reference Period shall
be reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the property that is the subject of such Material
Disposition for such Reference Period or increased by an amount equal to the Consolidated EBITDA (if negative) attributable thereto for
such Reference Period, and (ii) if during such Reference Period the Company or any Subsidiary shall have made a Material Acquisition,
Consolidated EBITDA for such Reference Period shall be calculated after giving effect thereto on a pro forma basis as if such Material
Acquisition occurred on the first day of such Reference Period. As used herein, “Material Acquisition” means any acquisition
of property or series of related acquisitions of property that (a) constitutes (i) assets comprising all or substantially all
or any significant portion of a business or operating unit of a business, or (ii) all or substantially all of the common stock or
other Equity Interests of a Person, and (b) involves the payment of consideration by the Company and its Subsidiaries in excess of
$10,000,000; and “Material Disposition” means any sale, transfer or disposition of property or series of related sales,
transfers, or dispositions of property that (a) constitutes (i) assets comprising all or substantially all or any significant
portion of a business or operating unit of a business, or (ii) all or substantially all of the common stock or other Equity Interests
of a Person, and (b) involves gross proceeds to the Company or any of its Subsidiaries in excess of $10,000,000.

 

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“Consolidated
Interest Expense” means, with reference to any period, the interest payable on, and amortization of debt discount in respect
of, all Indebtedness of the Company and its Subsidiaries calculated on a consolidated basis for such period in accordance with GAAP. In
the event that the Company or any Subsidiary shall have completed a Material Acquisition or a Material Disposition (as each such term
is defined in the definition of “Consolidated EBITDA”) since the beginning of the relevant period, Consolidated Interest Expense
shall be determined for such period on a pro forma basis as if such acquisition or disposition, and any related incurrence or repayment
of Indebtedness, had occurred at the beginning of such period.

 

“Consolidated
Revenues” means, with reference to any period, total revenues of the Company and its Subsidiaries calculated in accordance with
GAAP on a consolidated basis for such period.

 

“CPS”
means the Crown Prosecution Service of the United Kingdom (or any successor or replacement body from time to time).

 

“Criminal
Pension Power” means any action taken under, pursuant to or in connection with section 58A, section 58B, section 58C or section
58D of the United Kingdom Pensions Act 2004.

 

“Disposition”
or “Dispose” means the sale, transfer, license, lease or other disposition (including any Sale and Leaseback Transaction)
of any property by any Person, including any sale, assignment (excluding any Lien), transfer or other disposal, with or without recourse,
of any notes or accounts receivable or any rights and claims associated therewith.

 

“Indebtedness”
means, as to any Person at a particular time, without duplication, all of the following, but only to the extent included as indebtedness
or liabilities in accordance with GAAP: (a) all obligations of such Person for borrowed money, (b) all obligations of such Person
evidenced by bonds, debentures, notes, loan agreements or similar instruments, (c) all obligations of such Person to pay the deferred
purchase price of property or services (other than accounts payable incurred in the ordinary course of business or any earn-out obligations),
(d) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including
indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed
by such Person or is limited in recourse, (e) all obligations of such Person for unreimbursed payments made under letters of credit
(including standby and commercial), bankers’ acceptances and bank guarantees, (f) all obligations in respect of finance leases
of such Person, (g) (only for purposes of calculating Consolidated Indebtedness) net obligations of such Person under any Swap Agreement
pertaining to interest rates and (h) all Guarantees of such Person in respect of any of the foregoing; provided that the term “Indebtedness”
shall not include obligations in respect of operating leases regardless of whether they appear on the balance sheet of such Person. For
purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint
venture that is itself a corporation, limited liability company or other limited liability entity) in which such person is a general partner
or a joint venture, unless such Indebtedness is expressly made non-recourse to such Person. The amount of any net obligation under any
Swap Agreement on any date shall be deemed to be the Swap Termination Value thereof as of such date. The amount of any finance lease as
of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.

 

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Indebtedness of
any Person shall include all obligations of such Person of the character described in clauses (a) through (h) to the extent
such Person remains legally liable in respect thereof notwithstanding that any such obligation is deemed to be extinguished under GAAP.

 

Upon the defeasance
or satisfaction and discharge of Indebtedness in accordance with the terms of the documents governing such Indebtedness, such Indebtedness
will cease to be “Indebtedness” hereunder (upon the giving or mailing of a notice of redemption and redemption funds being
deposited with a trustee or paying agent or otherwise segregated or held in trust or under an escrow or other funding arrangement for
the sole purpose of repurchasing, redeeming, defeasing, repaying, satisfying and discharging, or otherwise acquiring or retiring such
Indebtedness, or other substantially comparable processes).

 

“Liquidity
Amount” means, as of any date of determination, the lesser of (i) the sum of, without duplication, (a) 100% of the
unrestricted and unencumbered cash and cash equivalents maintained by the Company and its Domestic Subsidiaries as of such date, plus
(b) 70% of the unrestricted and unencumbered cash and cash equivalents maintained by the Company and its Subsidiaries in notional
pooling structures outside of the United States and by its Foreign Subsidiaries as of such date and (ii) $500,000,000; provided,
however, that amounts calculated under this definition shall exclude any amounts that would not be considered “cash”
or “cash equivalents” as recorded on the books of the Company or the applicable Subsidiary.

 

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“Material
Adverse Effect” means a material adverse effect on (a) the business, operations or financial condition of the Company and
the Subsidiaries taken as a whole, (b) the ability of the Transaction Parties to perform their payment obligations under the Transaction
Documents or (c) the material rights or remedies of any holder of a Note under the Transaction Documents.

 

“Milacron
Pension Scheme” means the existing pension scheme for which Milacron UK Ltd. (a registered company in England with number 04444980)
is an employer (for the purposes of sections 38 to 51 of the United Kingdom Pensions Act 2004).

 

"Pensions
Regulator" means the body corporate established under section 1 of the United Kingdom Pensions Act 2004 (or any replacement or
successor body from time to time.

 

“Primary
Credit Facility” means the Fourth Amended and Restated Credit Agreement, dated as of June 8, 2022, among the Company, the
subsidiary borrowers party thereto, the subsidiary guarantors party thereto, the Lenders party thereto and JPMorgan Chase Bank, N.A.,
as administrative agent, as amended, restated, amended and restated, refinanced or replaced from time to time.

 

1.15         Each
reference to “PricewaterhouseCoopers LLP” in the Note Agreement shall be replaced to instead reference “Ernst &
Young LLP”.

 

SECTION 2.   Representations
and Warranties. Each of the Company and each Guarantor represents and warrants that (a) the
execution and delivery of this letter has been duly authorized by all requisite corporate action on behalf of the Company and such Guarantor,
this letter has been duly executed and delivered by an authorized officer of the Company and such Guarantor, and the Company and such
Guarantor has obtained all authorizations, consents, and approvals necessary for the execution, delivery and performance of this letter
and such authorizations, consents and approvals are in full force and effect, (b) each representation and warranty set forth in Section 5
of the Note Agreement (after giving effect to the amendments in Section 1) and the other Transaction Documents is true and correct
in all material respects as of the date of execution and delivery of this letter by the Company and such Guarantor with the same effect
as if made on such date (except to the extent such representations and warranties expressly refer to an earlier date, in which case they
were true and correct in all material respects as of such earlier date) and (c) after giving effect to the amendments in Section 1,
no Event of Default or Default exists.

 

SECTION 3.   Conditions
to Effectiveness. The amendments described in Section 1 above shall become effective
on the date (the “Effective Date”) when each of the following conditions in Section 3.1 and 3.2 below have been
satisfied, provided that the amendment and restatement of the definition of “Liquidity Amount” and the amendment to Section 10.9(a) of
the Note Agreement (the “Specified Amendments”), shall not become effective until the condition set forth below in
Section 3.3 is also satisfied:

 

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3.1           Documents.
Each holder of a Note shall have received original counterparts or, if reasonably satisfactory to the Required Holders, certified or other
copies of all of the following, each duly executed and delivered by the party or parties thereto, in form and substance reasonably satisfactory
to the Required Holders, dated the date hereof unless otherwise indicated, and on the date hereof in full force and effect:

 

(i)            counterparts
of this letter executed by the Company, the Guarantors and the Required Holders; and

 

(ii)           an
Officer’s Certificate of the Company, in form and substance reasonably satisfactory to the Required Holders, attaching a true and
complete copy of the Fourth Amended and Restated Credit Agreement, executed by the Company, the subsidiary borrowers party thereto, JPMorgan
Chase Bank, N.A., as administrative agent, and the financial institutions party thereto as lenders.

 

3.2            Proceedings.
All corporate and other proceedings taken or to be taken in connection with the transactions contemplated by this letter shall be reasonably
satisfactory to Prudential, and Prudential shall have received all such counterpart originals or certified or other copies of such documents
as it may reasonably request.

 

3.3            Specified
Amendments. The Specified Amendments shall become effective upon delivery of an Officer’s Certificate of the Company, in form
and substance reasonably satisfactory to the Required Holders (a) attaching an executed copy of a renewal of the Company’s
LG Facility Agreement (as defined in the Company’s most recent filings with the SEC), a draft of which was previously provided to
Prudential and which contains provisions equivalent to the Specified Amendments and (b) representing that each of the amendments
to Section 6.10(a) and the definition of “Liquidity Amount” contained in the Primary Credit Facility that are conditioned
on amendments to the Note Agreement and the LG Facility are effective.

 

SECTION 4.   Reference
to and Effect on Note Agreement and Notes; Ratification of Transaction Documents. Upon the
effectiveness of the amendments in Section 1 of this letter, each reference to the Note Agreement in any other Transaction Document
shall mean and be a reference to the Note Agreement, as modified by this letter. Except as specifically set forth in Section 1 hereof,
the Note Agreement, the Notes and each other Transaction Document shall remain in full force and effect and are hereby ratified and confirmed
in all respects. Except as specifically stated in this letter, the execution, delivery and effectiveness of this letter shall not (a) amend
the Note Agreement, any Note or any other Transaction Document, (b) operate as a waiver of any right, power or remedy of Prudential
or any holder of the Notes, or (c) constitute a waiver of, or consent to any departure from, any provision of the Note Agreement,
any Note or any other Transaction Document at any time. The execution, delivery and effectiveness of this letter shall not be construed
as a course of dealing or other implication that Prudential or any holder of the Notes has agreed to or is prepared to grant any consents
or agree to any amendment to the Note Agreement in the future, whether or not under similar circumstances.

 

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SECTION 5.   Reaffirmation.
Each Guarantor hereby consents to the foregoing amendments to the Note Agreement and hereby ratifies and reaffirms all of its payment
and performance obligations, contingent or otherwise, under the Guaranty Agreement and each other Transaction Document, after giving effect
to such amendments. Each Guarantor hereby acknowledges that, notwithstanding the foregoing amendments, the Guaranty Agreement and each
other Transaction Document remains in full force and effect and is hereby ratified and confirmed. Without limiting the generality of the
foregoing, each Guarantor agrees and confirms that the Guaranty Agreement continues to guaranty the Guaranteed Obligations (as defined
in the Guaranty Agreement) arising under or in connection with the Note Agreement, as amended by this letter agreement, or any of the
Notes.

 

SECTION 6.   Expenses.
 The Company hereby confirms its obligations under Section 16.1 of the Note Agreement in connection with the transactions hereby
contemplated, whether or not such transactions are consummated.

 

SECTION 7.   Governing
Law. THIS LETTER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF
THE STATE OF NEW YORK EXCLUDING CHOICE OF LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD PERMIT THE APPLICATION OF THE LAWS OF A JURISDICTION
OTHER THAN SUCH STATE.

 

SECTION 8.   Counterparts;
Section Titles. This letter may be executed in any number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original and all of which when taken together shall constitute but
one and the same instrument. Delivery of an executed counterpart of a signature page to this letter by facsimile or electronic transmission
shall be effective as delivery of a manually executed counterpart of this letter. The section titles contained in this letter are and
shall be without substance, meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto.

 

[signature page follows]

 

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	 	Very truly yours,
	 	 
	 	 
	 	PGIM, INC.
	 	 
	 	By:	/s/ Christopher Wang
	 	 	Christopher Wang
	 	 	Vice President
	 	 	 
	 	THE PRUDENTIAL INSURANCE
    COMPANY OF AMERICA
	 	 	 
	 	By:	PGIM, Inc. (as Investment Manager)
	 	 	 
	 	 	 
	 	By:	/s/ Christopher Wang
	 	 	Christopher Wang
	 	 	Vice President
	 	 	 
	 	THE GIBRALTAR LIFE INSURANCE CO.,  LTD.
	 	 	 
	 	By:	PGIM Japan Co., Ltd. (as Investment Manager)
	 	 	 
	 	By:	PGIM, Inc. (as Sub-Adviser)
	 	 	 
	 	 	 
	 	By:	/s/ Christopher Wang
	 	 	Christopher Wang
	 	 	Vice President
	 	 	 
	 	PAR U HARTFORD LIFE & ANNUITY COMFORT TRUST
	 	 	 
	 	By:	Prudential Arizona Reinsurance Universal Company (as Grantor)
	 	 	 
	 	By:	PGIM, Inc. (as Investment Manager)
	 	 	 
	 	 	 
	 	By:	/s/ Christopher Wang
	 	 	Christopher Wang
	 	 	Vice President

 

Amendment
No. 8 to Private Shelf Agreement

 

    

     

    

 

	 	THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
	 	FARMERS INSURANCE EXCHANGE
	 	MID CENTURY INSURANCE COMPANY
	 	THE INDEPENDENT ORDER OF FORESTERS
	 	 	 
	 	By:	PGIM Private Placement Investors, L.P.
	 	 	(as Investment Advisor)
	 	 	 
	 	By:	PGIM Private Placement Investors, Inc.
	 	 	(as its General Partner)
	 	 	 
	 	 	 
	 	By:	/s/ Christopher Wang
	 	 	Christopher Wang
	 	 	Vice President

 

Amendment
No. 8 to Private Shelf Agreement

 

    

     

    

  

	The foregoing letter is	 
	hereby accepted as of the	 
	date first above written:	 
	 	 
	 	 
	HILLENBRAND, INC.	 
	 	 
	 	 
	By:	/s/ Theodore S. Haddad, Jr.	 
	Name:	Theodore S. Haddad, Jr.	 
	Title:	Vice President and Treasurer	 

 

Amendment No. 8 to Private Shelf Agreement

 

    

     

    

 

	BATESVILLE CASKET COMPANY, INC.	 
	BATESVILLE SERVICES, INC.	 
	 	 
	 	 
	By:	/s/ Theodore S. Haddad, Jr.	 
	Name:	Theodore S. Haddad, Jr.	 
	Title:	Vice President and Treasurer	 
	 	 
	 	 
	K-TRON INVESTMENT CO.	 
	 	 
	 	 
	By:	/s/ Theodore S. Haddad, Jr.	 
	Name:	Theodore S. Haddad, Jr.	 
	Title:	Vice President and Assistant Treasurer	 
	 	 
	 	 
	PROCESS EQUIPMENT GROUP, INC.	 
	Hillenbrand Luxembourg Inc.	 
	Milacron LLC	 
	Milacron Marketing Company LLC	 
	Milacron Plastics Technologies Group LLC	 
	 	 
	 	 
	By:	/s/ Theodore S. Haddad, Jr.	 
	Name:	Theodore S. Haddad, Jr.	 
	Title:	Treasurer	 

 

Amendment No. 8 to Private Shelf Agreementex_386042.htm

Exhibit 10.1

 

 

UroGen Pharma Ltd.

 

2017 Equity Incentive Plan

 

Adopted by the Board of Directors: March 29, 2017 and May 3, 2017

Approved by the Stockholders: April 19, 2017

IPO Date/Effective Date: May 9, 2017

Amended by the Board of Directors: August 29, 2018

Amended by the Board of Directors: April 26, 2020

Approved by the Stockholders: June 8, 2020

Amended by the Board of Directors: March 17, 2021

Approved by the Stockholders: June 7, 2021

Amended by the Board of Directors: March 7, 2022

Approved by the Stockholders: June 8, 2021

 

 

1.    GENERAL.

 

(a)    Eligible Award Recipients. Employees, Directors and Consultants are eligible to receive Awards.

 

(b)    Available Awards. The Plan provides for the grant of the following types of Awards: (i) Incentive Stock Options, (ii) Nonstatutory Stock Options, (iii) Stock Appreciation Rights (iv) Restricted Stock Awards, (v) Restricted Stock Unit Awards, (vi) Performance Stock Awards, (vii) Performance Cash Awards, and (viii) Other Stock Awards.

 

(c)    Purpose. The Plan, through the grant of Awards, is intended to help the Company secure and retain the services of eligible award recipients, provide incentives for such persons to exert maximum efforts for the success of the Company and any Affiliate, and provide a means by which the eligible recipients may benefit from increases in value of the Ordinary Shares.

 

2.    ADMINISTRATION.

 

(a)    Administration by Board. The Board will administer the Plan. The Board may delegate administration of the Plan to a Committee or Committees, as provided in Section 1(f).

 

(b)    Powers of Board. The Board will have the power, subject to, and within the limitations of, the express provisions of the Plan:

 

	 	
			i.

				
			To determine: (A) who will be granted Awards; (B) when and how each Award will be granted; (C) what type of Award will be granted; (D) the provisions of each Award (which need not be identical), including when a person will be permitted to exercise or otherwise receive cash or Ordinary Shares under the Award; (E) the number of Ordinary Shares subject to, or the cash value of, an Award; and (F) the Fair Market Value applicable to a Stock Award.

			

 

	 	
			ii.

				
			To construe and interpret the Plan and Awards granted under it, and to establish, amend and revoke rules and regulations for administration of the Plan and Awards. The Board, in the exercise of these powers, may correct any defect, omission or inconsistency in the Plan or in any Award Agreement or in the written terms of a Performance Cash Award, in a manner and to the extent it will deem necessary or expedient to make the Plan or Award fully effective.

			

 

	 	
			iii.

				
			To settle all controversies regarding the Plan and Awards granted under it.

			

 

	 	
			iv.

				
			To accelerate, in whole or in part, the time at which an Award may be exercised or vest (or the time at which cash or Ordinary Shares may be issued in settlement thereof).

			

 

	 	
			v.

				
			To suspend or terminate the Plan at any time. Except as otherwise provided in the Plan or an Award Agreement, suspension or termination of the Plan will not materially impair a Participant’s rights under the Participant’s then-outstanding Award without the Participant’s written consent.

			

 

	 	
			vi.

				
			To amend the Plan in any respect the Board deems necessary or advisable, including, without limitation, by adopting amendments relating to Incentive Stock Options and certain nonqualified deferred compensation under Section 409A of the Code and/or bringing the Plan or Awards granted under the Plan into compliance with the requirements for Incentive Stock Options or ensuring that they are exempt from, or compliant with, the requirements for nonqualified deferred compensation under Section 409A of the Code, subject to the limitations, if any, of applicable law. If required by applicable law or listing requirements (taking into account any permissible and effective opting out by the Company from such requirements), and except as provided in Section 1(uu) relating to Capitalization Adjustments, the Company will seek stockholder approval of any amendment of the Plan that (A) materially increases the number of Ordinary Shares available for issuance under the Plan, (B) materially expands the class of individuals eligible to receive Awards under the Plan, (C) materially increases the benefits accruing to Participants under the Plan, (D) materially reduces the price at which Ordinary Shares may be issued or purchased under the Plan, (E) materially extends the term of the Plan, or (F) materially expands the types of Awards available for issuance under the Plan. Except as otherwise provided in the Plan or an Award Agreement, no amendment of the Plan will materially impair a Participant’s rights under an outstanding Award without the Participant’s written consent.

			

 

	 	
			vii.

				
			To submit any amendment to the Plan for stockholder approval, including, but not limited to, amendments to the Plan intended to satisfy the requirements of (A) Section 162(m) of the Code regarding the exclusion of performance-based compensation from the limit on corporate deductibility of compensation paid to Covered Employees, (B) Section 422 of the Code regarding “incentive stock options” and/or (C) Rule 16b-3.

			

 

	 	
			viii.

				
			To approve forms of Award Agreements for use under the Plan and to amend the terms of any one or more Awards, including, but not limited to, amendments to provide terms more favorable to the Participant than previously provided in the Award Agreement, subject to any specified limits in the Plan that are not subject to Board discretion; provided, however, that a Participant’s rights under any Award will not be impaired by any such amendment unless (A) the Company requests the consent of the affected Participant, and (B) such Participant consents in writing. Notwithstanding the foregoing, (1) a Participant’s rights will not be deemed to have been impaired by any such amendment if the Board, in its sole discretion, determines that the amendment, taken as a whole, does not materially impair the Participant’s rights, and (2) subject to the limitations of applicable law, if any, the Board may amend the terms of any one or more Awards without the affected Participant’s consent (A) to maintain the qualified status of the Award as an Incentive Stock Option under Section 422 of the Code; (B) to change the terms of an Incentive Stock Option, if such change results in impairment of the Award solely because it impairs the qualified status of the Award as an Incentive Stock Option under Section 422 of the Code; (C) to clarify the manner of exemption from, or to bring the Award into compliance with, Section 409A of the Code; and/or (D) to comply with other applicable laws or listing requirements.

			

 

	 	
			ix.

				
			Generally, to exercise such powers and to perform such acts as the Board deems necessary or expedient to promote the best interests of the Company and that are not in conflict with the provisions of the Plan or Awards.

			

 

	 	
			x.

				
			To adopt such procedures and sub-plans as are necessary or appropriate to permit participation in the Plan by Employees, Directors or Consultants who are not United States nationals or who are employed outside the United States (provided that Board approval will not be necessary for immaterial modifications to the Plan or any Award Agreement that are required for compliance with the laws of the relevant foreign jurisdiction).

			

 

(c)    Delegation to Committee.

 

General. The Board may delegate some or all of the administration of the Plan to a Committee or Committees. If administration of the Plan is delegated to a Committee, the Committee will have, in connection with the administration of the Plan, the powers theretofore possessed by the Board that have been delegated to the Committee, including the power to delegate to a subcommittee of the Committee any of the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board will thereafter be to the Committee or subcommittee, as applicable). Any delegation of administrative powers will be reflected in resolutions, not inconsistent with the provisions of the Plan, adopted from time to time by the Board or Committee (as applicable). The Board may retain the authority to concurrently administer the Plan with the Committee and may, at any time, revest in the Board some or all of the powers previously delegated.

 

Section 162(m) and Rule 16b-3 Compliance. The Committee may consist solely of two or more Outside Directors, in accordance with Section 162(m) of the Code, or solely of two or more Non-Employee Directors, in accordance with Rule 16b-3.

 

(d)    Delegation to an Officer. The Board may delegate to one (1) or more Officers the authority to do one or both of the following (i) designate Employees who are not Officers to be recipients of Options and SARs (and, to the extent permitted by applicable law, other Stock Awards) and, to the extent permitted by applicable law, the terms of such Awards, and (ii) determine the number of Ordinary Shares to be subject to such Stock Awards granted to such Employees; provided, however, that the Board resolutions regarding such delegation will specify the total number of Ordinary Shares that may be subject to the Stock Awards granted by such Officer and that such Officer may not grant a Stock Award to himself or herself. Any such Stock Awards will be granted on the form of Stock Award Agreement most recently approved for use by the Committee or the Board, unless otherwise provided in the resolutions approving the delegation authority. The Board may not delegate authority to an Officer who is acting solely in the capacity of an Officer (and not also as a Director) to determine Fair Market Value

 

(e)    No Repricing of Awards. Neither the Board nor any Committee will have the authority to (i) reduce the exercise or strike price of any outstanding Option or SAR or (ii) cancel any outstanding Option or SAR that has an exercise or strike price (per share) greater than the then-current Fair Market Value of the Ordinary Shares in exchange for cash or other Stock Awards under the Plan, unless the shareholders of the Company have approved such an action within twelve (12) months prior to such an event.

 

(f)    Effect of Board’s Decision. All determinations, interpretations and constructions made by the Board in good faith will not be subject to review by any person and will be final, binding and conclusive on all persons.

 

3.    SHARES SUBJECT TO THE PLAN.

 

(a)    Share Reserve. Subject to Section 9(a) relating to Capitalization Adjustments, the aggregate number of Ordinary Shares that may be issued pursuant to Stock Awards from and after the Effective Date will not exceed 4,750,167 shares (the “Share Reserve”). For clarity, the Share Reserve in this Section 0 is a limitation on the number of Ordinary Shares that may be issued pursuant to the Plan. Accordingly, this Section 0 does not limit the granting of Stock Awards except as provided in Section 1(ff). Shares may be issued in connection with a merger or acquisition as permitted by NASDAQ Listing Rule 5635(c) or, if applicable, NYSE Listed Company Manual Section 303A.08, AMEX Company Guide Section 711 or other applicable rule, and such issuance will not reduce the number of shares available for issuance under the Plan.

 

(b)    Reversion of Shares to the Share Reserve. If a Stock Award or any portion thereof (i) expires or otherwise terminates without all of the shares covered by such Stock Award having been issued or (ii) is settled in cash (i.e., the Participant receives cash rather than stock), such expiration, termination or settlement will not reduce (or otherwise offset) the number of Ordinary Shares that may be available for issuance under the Plan and the Ordinary Shares relating to such Stock Award (or portion thereof) will again become available for issuance under the Plan. If any Ordinary Shares issued pursuant to a Stock Award are forfeited back to or repurchased by the Company because of the failure to meet a contingency or condition required to vest such shares in the Participant, then the shares that are forfeited or repurchased will revert to and again become available for issuance under the Plan. Any shares reacquired by the Company in satisfaction of tax withholding obligations on a Stock Award or as consideration for the exercise or purchase price of a Stock Award will again become available for issuance under the Plan.

 

(c)    Incentive Stock Option Limit. Subject to the provisions of Section 1(uu) relating to Capitalization Adjustments, the aggregate maximum number of Ordinary Shares that may be issued pursuant to the exercise of Incentive Stock Options will be 5,600,000 Ordinary Shares.

 

(d)    Section 162(m) Limitations. Subject to the provisions of Section 1(uu) relating to Capitalization Adjustments, at such time as the Company may be subject to the applicable provisions of Section 162(m) of the Code, the following limitations shall apply.

 

A maximum of 500,000 Ordinary Shares subject to Options, SARs and Other Stock Awards whose value is determined by reference to an increase over an exercise or strike price of at least 100% of the Fair Market Value on the date the Stock Award is granted may be granted to any one Participant during any one calendar year. Notwithstanding the foregoing, if any additional Options, SARs or Other Stock Awards whose value is determined by reference to an increase over an exercise or strike price of at least 100% of the Fair Market Value on the date the Stock Award are granted to any Participant during any calendar year, compensation attributable to the exercise of such additional Stock Awards will not satisfy the requirements to be considered “qualified performance-based compensation” under Section 162(m) of the Code unless such additional Stock Award is approved by the Company’s stockholders.

 

A maximum of 500,000 Ordinary Shares subject to Performance Stock Awards may be granted to any one Participant during any one calendar year (whether the grant, vesting or exercise is contingent upon the attainment during the Performance Period of the Performance Goals).

 

A maximum of $3.0 million may be granted as a Performance Cash Award to any one Participant during any one calendar year.

 

(e)    Source of Shares. The stock issuable under the Plan will be shares of authorized but unissued or reacquired Ordinary Shares, including shares repurchased by the Company on the open market or otherwise.

 

4.    ELIGIBILITY.

 

(a)    Eligibility for Specific Stock Awards. Incentive Stock Options may be granted only to employees of the Company or a “parent corporation” or “subsidiary corporation” thereof (as such terms are defined in Sections 424(e) and 424(f) of the Code). Stock Awards other than Incentive Stock Options may be granted to Employees, Directors and Consultants; provided, however, that Stock Awards may not be granted to Employees, Directors and Consultants who are providing Continuous Service only to any “parent” of the Company, as such term is defined in Rule 405 of the Securities Act, unless (i) the stock underlying such Stock Awards is treated as “service recipient stock” under Section 409A of the Code (for example, because the Stock Awards are granted pursuant to a corporate transaction such as a spin off transaction), (ii) the Company, in consultation with its legal counsel, has determined that such Stock Awards are otherwise exempt from Section 409A of the Code, or (iii) the Company, in consultation with its legal counsel, has determined that such Stock Awards comply with the distribution requirements of Section 409A of the Code.

 

(b)    Ten Percent Stockholders. A Ten Percent Stockholder will not be granted an Incentive Stock Option unless the exercise price of such Option is at least 110% of the Fair Market Value on the date of grant and the Option is not exercisable after the expiration of five years from the date of grant.

 

5.    PROVISIONS RELATING TO OPTIONS AND STOCK APPRECIATION RIGHTS.

 

Each Option or SAR will be in such form and will contain such terms and conditions as the Board deems appropriate. All Options will be separately designated Incentive Stock Options or Nonstatutory Stock Options at the time of grant, and, if certificates are issued, a separate certificate or certificates will be issued for Ordinary Shares purchased on exercise of each type of Option. If an Option is not specifically designated as an Incentive Stock Option, or if an Option is designated as an Incentive Stock Option but some portion or all of the Option fails to qualify as an Incentive Stock Option under the applicable rules, then the Option (or portion thereof) will be a Nonstatutory Stock Option. The provisions of separate Options or SARs need not be identical; provided, however, that each Award Agreement will conform to (through incorporation of provisions hereof by reference in the applicable Award Agreement or otherwise) the substance of each of the following provisions:

 

(a)    Term. Subject to the provisions of Section 1(o) regarding Ten Percent Stockholders, no Option or SAR will be exercisable after the expiration of ten years from the date of its grant or such shorter period specified in the Award Agreement.

 

(b)    Exercise Price. Subject to the provisions of Section 1(o) regarding Ten Percent Stockholders, the exercise or strike price of each Option or SAR will be not less than 100% of the Fair Market Value of the Ordinary Shares subject to the Option or SAR on the date the Award is granted. Notwithstanding the foregoing, an Option or SAR may be granted with an exercise or strike price lower than 100% of the Fair Market Value of the Ordinary Shares subject to the Award if such Award is granted pursuant to an assumption of or substitution for another option or stock appreciation right pursuant to a Corporate Transaction and in a manner consistent with the provisions of Section 409A and, if applicable, Section 424(a) of the Code. Each SAR will be denominated in Ordinary Shares equivalents.

 

(c)    Purchase Price for Options. The purchase price of Ordinary Shares acquired pursuant to the exercise of an Option may be paid, to the extent permitted by applicable law and as determined by the Board in its sole discretion, by any combination of the methods of payment set forth below. The Board will have the authority to grant Options that do not permit all of the following methods of payment (or otherwise restrict the ability to use certain methods) and to grant Options that require the consent of the Company to use a particular method of payment. The permitted methods of payment are as follows:

 

by cash, check, bank draft or money order payable to the Company;

 

pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that, prior to the issuance of the stock subject to the Option, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds;

 

by delivery to the Company (either by actual delivery or attestation) of Ordinary Shares;

 

if an Option is a Nonstatutory Stock Option, by a “net exercise” arrangement pursuant to which the Company will reduce the number of Ordinary Shares issuable upon exercise by the largest whole number of shares with a Fair Market Value that does not exceed the aggregate exercise price; provided, however, that the Company will accept a cash or other payment from the Participant to the extent of any remaining balance of the aggregate exercise price not satisfied by such reduction in the number of whole shares to be issued. Ordinary Shares will no longer be subject to an Option and will not be exercisable thereafter to the extent that (A) shares issuable upon exercise are used to pay the exercise price pursuant to the “net exercise,” (B) shares are delivered to the Participant as a result of such exercise, and (C) shares are withheld to satisfy tax withholding obligations; or

 

in any other form of legal consideration that may be acceptable to the Board and specified in the applicable Award Agreement.

 

(d)    Exercise and Payment of a SAR. To exercise any outstanding SAR, the Participant must provide written notice of exercise to the Company in compliance with the provisions of the Stock Appreciation Right Agreement evidencing such SAR. The appreciation distribution payable on the exercise of a SAR will be not greater than an amount equal to the excess of (A) the aggregate Fair Market Value (on the date of the exercise of the SAR) of a number of Ordinary Shares equal to the number of Ordinary Share equivalents in which the Participant is vested under such SAR, and with respect to which the Participant is exercising the SAR on such date, over (B) the aggregate strike price of the number of Ordinary Share equivalents with respect to which the Participant is exercising the SAR on such date. The appreciation distribution may be paid in Ordinary Shares, in cash, in any combination of the two or in any other form of consideration, as determined by the Board and contained in the Award Agreement evidencing such SAR.

 

(e)    Transferability of Options and SARs. The Board may, in its sole discretion, impose such limitations on the transferability of Options and SARs as the Board will determine. In the absence of such a determination by the Board to the contrary, the following restrictions on the transferability of Options and SARs will apply:

 

Restrictions on Transfer. An Option or SAR will not be transferable except by will or by the laws of descent and distribution (or pursuant to subsections (ii) and (iii) below), and will be exercisable during the lifetime of the Participant only by the Participant. The Board may permit transfer of the Option or SAR in a manner that is not prohibited by applicable tax and securities laws. Except as explicitly provided in the Plan, neither an Option nor a SAR may be transferred for consideration.

 

Domestic Relations Orders. Subject to the approval of the Board or a duly authorized Officer, an Option or SAR may be transferred pursuant to the terms of a domestic relations order, official marital settlement agreement or other divorce or separation instrument as permitted by Treasury Regulations Section 1.421-1(b)(2). If an Option is an Incentive Stock Option, such Option may be deemed to be a Nonstatutory Stock Option as a result of such transfer.

 

Beneficiary Designation. Subject to the approval of the Board or a duly authorized Officer, a Participant may, by delivering written notice to the Company, in a form approved by the Company (or the designated broker), designate a third party who, on the death of the Participant, will thereafter be entitled to exercise the Option or SAR and receive the Ordinary Shares or other consideration resulting from such exercise. In the absence of such a designation, upon the death of the Participant, the executor or administrator of the Participant’s estate will be entitled to exercise the Option or SAR and receive the Ordinary Shares or other consideration resulting from such exercise. However, the Company may prohibit designation of a beneficiary at any time, including due to any conclusion by the Company that such designation would be inconsistent with the provisions of applicable laws.

 

(f)    Vesting Generally. The total number of Ordinary Shares subject to an Option or SAR may vest and become exercisable in periodic installments that may or may not be equal. The Option or SAR may be subject to such other terms and conditions on the time or times when it may or may not be exercised (which may be based on the satisfaction of Performance Goals or other criteria) as the Board may deem appropriate. The vesting provisions of individual Options or SARs may vary. The provisions of this Section 1(u) are subject to any Option or SAR provisions governing the minimum number of Ordinary Shares as to which an Option or SAR may be exercised.

 

(g)    Termination of Continuous Service. Except as otherwise provided in the applicable Award Agreement or other agreement between the Participant and the Company, if a Participant’s Continuous Service terminates (other than for Cause and other than upon the Participant’s death or Disability), the Participant may exercise his or her Option or SAR (to the extent that the Participant was entitled to exercise such Award as of the date of termination of Continuous Service) within the period of time ending on the earlier of (i) the date which occurs ninety (90) days following the termination of the Participant’s Continuous Service (or such longer or shorter period specified in the applicable Award Agreement), and (ii) the expiration of the term of the Option or SAR as set forth in the Award Agreement. If, after termination of Continuous Service, the Participant does not exercise his or her Option or SAR (as applicable) within the applicable time frame, the Option or SAR will terminate.

 

(h)    Extension of Termination Date. If the exercise of an Option or SAR following the termination of the Participant’s Continuous Service (other than for Cause and other than upon the Participant’s death or Disability) would be prohibited at any time solely because the issuance of Ordinary Shares would violate the registration requirements under the Securities Act, then the Option or SAR will terminate on the earlier of (i) the expiration of a total period of time (that need not be consecutive) equal to the applicable post termination exercise period after the termination of the Participant’s Continuous Service during which the exercise of the Option or SAR would not be in violation of such registration requirements, and (ii) the expiration of the term of the Option or SAR as set forth in the applicable Award Agreement. In addition, unless otherwise provided in a Participant’s Award Agreement, if the sale of any Ordinary Shares received on exercise of an Option or SAR following the termination of the Participant’s Continuous Service (other than for Cause) would violate the Company’s insider trading policy, then the Option or SAR will terminate on the earlier of (i) the expiration of the period of days or months (that need not be consecutive) equal to the applicable post-termination exercise period after the termination of the Participant’s Continuous Service during which the sale of the Ordinary Shares received upon exercise of the Option or SAR would not be in violation of the Company’s insider trading policy, or (ii) the expiration of the term of the Option or SAR as set forth in the applicable Award Agreement.

 

(i)    Disability of Participant. Except as otherwise provided in the applicable Award Agreement or other agreement between the Participant and the Company, if a Participant’s Continuous Service terminates as a result of the Participant’s Disability, the Participant may exercise his or her Option or SAR (to the extent that the Participant was entitled to exercise such Option or SAR as of the date of termination of Continuous Service), but only within such period of time ending on the earlier of (i) the date which occurs 12 months following such termination of Continuous Service (or such longer or shorter period specified in the Award Agreement), and (ii) the expiration of the term of the Option or SAR as set forth in the Award Agreement. If, after termination of Continuous Service, the Participant does not exercise his or her Option or SAR within the applicable time frame, the Option or SAR (as applicable) will terminate.

 

(j)    Death of Participant. Except as otherwise provided in the applicable Award Agreement or other agreement between the Participant and the Company, if (i) a Participant’s Continuous Service terminates as a result of the Participant’s death, or (ii) the Participant dies within the period (if any) specified in the Award Agreement for exercisability after the termination of the Participant’s Continuous Service for a reason other than death, then the Option or SAR may be exercised (to the extent the Participant was entitled to exercise such Option or SAR as of the date of death) by the Participant’s estate, by a person who acquired the right to exercise the Option or SAR by bequest or inheritance or by a person designated to exercise the Option or SAR upon the Participant’s death, but only within the period ending on the earlier of (i) the date which occurs 18 months following the date of death (or such longer or shorter period specified in the Award Agreement), and (ii) the expiration of the term of such Option or SAR as set forth in the Award Agreement. If, after the Participant’s death, the Option or SAR is not exercised within the applicable time frame, the Option or SAR (as applicable) will terminate.

 

(k)    Termination for Cause. Except as explicitly provided otherwise in a Participant’s Award Agreement or other individual written agreement between the Company or any Affiliate and the Participant, if a Participant’s Continuous Service is terminated for Cause, the Option or SAR will terminate immediately upon such Participant’s termination of Continuous Service, and the Participant will be prohibited from exercising his or her Option or SAR from and after the date of such termination of Continuous Service.

 

(l)    Non-Exempt Employees. If an Option or SAR is granted to an Employee who is a non-exempt employee for purposes of the Fair Labor Standards Act of 1938, as amended, the Option or SAR will not be first exercisable for any Ordinary Shares until at least six months following the date of grant of the Option or SAR (although the Award may vest prior to such date). Consistent with the provisions of the Worker Economic Opportunity Act, (i) if such non-exempt Employee dies or suffers a Disability, (ii) upon a Corporate Transaction in which such Option or SAR is not assumed, continued, or substituted, (iii) upon a Change in Control, or (iv) upon the Participant’s retirement (as such term may be defined in the Participant’s Award Agreement in another agreement between the Participant and the Company, or, if no such definition, in accordance with the Company's then current employment policies and guidelines), the vested portion of any Options and SARs may be exercised earlier than six months following the date of grant. The foregoing provision is intended to operate so that any income derived by a non-exempt employee in connection with the exercise or vesting of an Option or SAR will be exempt from his or her regular rate of pay. To the extent permitted and/or required for compliance with the Worker Economic Opportunity Act to ensure that any income derived by a non-exempt employee in connection with the exercise, vesting or issuance of any shares under any other Stock Award will be exempt from the employee’s regular rate of pay, the provisions of this Section 5(l) will apply to all Stock Awards and are hereby incorporated by reference into such Stock Award Agreements.

 

6.    PROVISIONS OF STOCK AWARDS OTHER THAN OPTIONS AND SARS.

 

(a)    Restricted Stock Awards. Each Restricted Stock Award Agreement will be in such form and will contain such terms and conditions as the Board will deem appropriate. To the extent consistent with the Company’s articles of association, at the Board’s election, Ordinary Shares may be (x) held in book entry form subject to the Company’s instructions until any restrictions relating to the Restricted Stock Award lapse; or (y) evidenced by a certificate, which certificate will be held in such form and manner as determined by the Board. The terms and conditions of Restricted Stock Award Agreements may change from time to time, and the terms and conditions of separate Restricted Stock Award Agreements need not be identical. Each Restricted Stock Award Agreement will conform to (through incorporation of the provisions hereof by reference in the agreement or otherwise) the substance of each of the following provisions:

 

Consideration. A Restricted Stock Award may be awarded in consideration for (A) cash, check, bank draft or money order payable to the Company, (B) past services to the Company or an Affiliate, or (C) any other form of legal consideration (including future services) that may be acceptable to the Board, in its sole discretion, and permissible under applicable law.

 

Vesting. Ordinary Shares awarded under the Restricted Stock Award Agreement may be subject to forfeiture to the Company in accordance with a vesting schedule to be determined by the Board.

 

Termination of Participant’s Continuous Service. If a Participant’s Continuous Service terminates, the Company may receive through a forfeiture condition or a repurchase right any or all of the Ordinary Shares held by the Participant that have not vested as of the date of termination of Continuous Service under the terms of the Restricted Stock Award Agreement.

 

Transferability. Rights to acquire Ordinary Shares under the Restricted Stock Award Agreement will be transferable by the Participant only upon such terms and conditions as are set forth in the Restricted Stock Award Agreement, as the Board will determine in its sole discretion, so long as Ordinary Shares awarded under the Restricted Stock Award Agreement remains subject to the terms of the Restricted Stock Award Agreement.

 

Dividends. A Restricted Stock Award Agreement may provide that any dividends paid on Restricted Stock will be subject to the same vesting and forfeiture restrictions as apply to the shares subject to the Restricted Stock Award to which they relate.

 

(b)    Restricted Stock Unit Awards. Each Restricted Stock Unit Award Agreement will be in such form and will contain such terms and conditions as the Board will deem appropriate. The terms and conditions of Restricted Stock Unit Award Agreements may change from time to time, and the terms and conditions of separate Restricted Stock Unit Award Agreements need not be identical. Each Restricted Stock Unit Award Agreement will conform to (through incorporation of the provisions hereof by reference in the Agreement or otherwise) the substance of each of the following provisions:

 

Consideration. At the time of grant of a Restricted Stock Unit Award, the Board will determine the consideration, if any, to be paid by the Participant upon delivery of each share of Ordinary Shares subject to the Restricted Stock Unit Award. The consideration to be paid (if any) by the Participant for each share of Ordinary Shares subject to a Restricted Stock Unit Award may be paid in any form of legal consideration that may be acceptable to the Board, in its sole discretion, and permissible under applicable law.

 

Vesting. At the time of the grant of a Restricted Stock Unit Award, the Board may impose such restrictions on or conditions to the vesting of the Restricted Stock Unit Award as it, in its sole discretion, deems appropriate.

 

Payment. A Restricted Stock Unit Award may be settled by the delivery of Ordinary Shares, their cash equivalent, any combination thereof or in any other form of consideration, as determined by the Board and contained in the Restricted Stock Unit Award Agreement.

 

Additional Restrictions. At the time of the grant of a Restricted Stock Unit Award, the Board, as it deems appropriate, may impose such restrictions or conditions that delay the delivery of the Ordinary Shares (or their cash equivalent) subject to a Restricted Stock Unit Award to a time after the vesting of such Restricted Stock Unit Award.

 

Dividend Equivalents. Dividend equivalents may be credited in respect of Ordinary Shares covered by a Restricted Stock Unit Award, as determined by the Board and contained in the Restricted Stock Unit Award Agreement. At the sole discretion of the Board, such dividend equivalents may be converted into additional Ordinary Shares covered by the Restricted Stock Unit Award in such manner as determined by the Board. Any additional shares covered by the Restricted Stock Unit Award credited by reason of such dividend equivalents will be subject to all of the same terms and conditions of the underlying Restricted Stock Unit Award Agreement to which they relate.

 

Termination of Participant’s Continuous Service. Except as otherwise provided in the applicable Restricted Stock Unit Award Agreement, such portion of the Restricted Stock Unit Award that has not vested will be forfeited upon the Participant’s termination of Continuous Service.

 

(c)    Performance Awards.

 

Performance Stock Awards. A Performance Stock Award is a Stock Award (covering a number of shares not in excess of that set forth in Section 3(d) above) that is payable (including that may be granted, may vest or may be exercised) contingent upon the attainment during a Performance Period of certain Performance Goals. A Performance Stock Award may but need not require the Participant’s completion of a specified period of Continuous Service. The length of any Performance Period, the Performance Goals to be achieved during the Performance Period, and the measure of whether and to what degree such Performance Goals have been attained will be conclusively determined by the Committee (or, if not required for compliance with Section 162(m) of the Code, the Board), in its sole discretion. In addition, to the extent permitted by applicable law and the applicable Award Agreement, the Board or the Committee may determine that cash may be used in payment of Performance Stock Awards.

 

Performance Cash Awards. A Performance Cash Award is a cash award (for a dollar value not in excess of that set forth in Section 3(d) above) that is payable contingent upon the attainment during a Performance Period of certain Performance Goals. A Performance Cash Award may also require the completion of a specified period of Continuous Service. At the time of grant of a Performance Cash Award, the length of any Performance Period, the Performance Goals to be achieved during the Performance Period, and the measure of whether and to what degree such Performance Goals have been attained will be conclusively determined by the Committee (or, if not required for compliance with Section 162(m) of the Code, the Board), in its sole discretion. The Board or the Committee may specify the form of payment of Performance Cash Awards, which may be cash or other property, or may provide for a Participant to have the option for his or her Performance Cash Award, or such portion thereof as the Board or the Committee may specify, to be paid in whole or in part in cash or other property.

 

Board and Committee Discretion. The Board and the Committee retain the discretion to reduce or eliminate the compensation or economic benefit due upon attainment of Performance Goals and to define the manner of calculating the Performance Criteria it selects to use for a Performance Period. Partial achievement of the specified criteria may result in the payment or vesting corresponding to the degree of achievement as specified in the Stock Award Agreement or the written terms of a Performance Cash Award.

 

Section 162(m) Compliance. Unless otherwise permitted in compliance with the requirements of Section 162(m) of the Code with respect to an Award intended to qualify as “performance-based compensation” thereunder, the Committee will establish the Performance Goals applicable to, and the formula for calculating the amount payable under, the Award no later than the earlier of (a) the date which occurs 90 days after the commencement of the applicable Performance Period, and (b) the date on which 25% of the Performance Period has elapsed, and in any event at a time when the achievement of the applicable Performance Goals remains substantially uncertain. Prior to the payment of any compensation under an Award intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the Committee will certify the extent to which any Performance Goals and any other material terms under such Award have been satisfied (other than in cases where such Performance Goals relate solely to the increase in the value of the Ordinary Shares). Notwithstanding satisfaction of, or completion of any Performance Goals, the number of Ordinary Shares, Options, cash or other benefits granted, issued, retainable and/or vested under an Award on account of satisfaction of such Performance Goals may be reduced by the Committee on the basis of such further considerations as the Committee, in its sole discretion, will determine.

 

(d)    Other Stock Awards. Other forms of Stock Awards valued in whole or in part by reference to, or otherwise based on, Ordinary Shares, including the appreciation in value thereof (e.g., options or stock rights with an exercise price or strike price less than 100% of the Fair Market Value of the Ordinary Shares at the time of grant) may be granted either alone or in addition to Stock Awards provided for under Section 0 and the preceding provisions of this Section 0. Subject to the provisions of the Plan, the Board will have sole and complete authority to determine the persons to whom and the time or times at which such Other Stock Awards will be granted, the number of Ordinary Shares (or the cash equivalent thereof) to be granted pursuant to such Other Stock Awards and all other terms and conditions of such Other Stock Awards.

 

7.    COVENANTS OF THE COMPANY.

 

(a)    Availability of Shares. The Company will keep available at all times the number of Ordinary Shares reasonably required to satisfy then-outstanding Awards.

 

(b)    Securities Law Compliance. The Company will seek to obtain from each regulatory commission or agency having jurisdiction over the Plan such authority as may be required to grant Stock Awards and to issue and sell Ordinary Shares upon exercise of the Stock Awards; provided, however, that this undertaking will not require the Company to register under the Securities Act the Plan, any Stock Award or any Ordinary Shares issued or issuable pursuant to any such Stock Award. If, after reasonable efforts and at a reasonable cost, the Company is unable to obtain from any such regulatory commission or agency the authority that counsel for the Company deems necessary for the lawful issuance and sale of Ordinary Shares under the Plan, the Company will be relieved from any liability for failure to issue and sell Ordinary Shares upon exercise of such Stock Awards unless and until such authority is obtained. A Participant will not be eligible for the grant of an Award or the subsequent issuance of cash or Ordinary Shares pursuant to the Award if such grant or issuance would be in violation of any applicable securities law.

 

(c)    No Obligation to Notify or Minimize Taxes. The Company will have no duty or obligation to any Participant to advise such holder as to the time or manner of exercising such Stock Award. Furthermore, the Company will have no duty or obligation to warn or otherwise advise such holder of a pending termination or expiration of an Award or a possible period in which the Award may not be exercised. The Company has no duty or obligation to minimize the tax consequences of an Award to the holder of such Award.

 

8.    MISCELLANEOUS.

 

(a)    Use of Proceeds from Sales of Ordinary Shares. Proceeds from the sale of Ordinary Shares pursuant to Awards will constitute general funds of the Company.

 

(b)    Corporate Action Constituting Grant of Awards. Corporate action constituting a grant by the Company of an Award to any Participant will be deemed completed as of the date of such corporate action, unless otherwise determined by the Board, regardless of when the instrument, certificate, or letter evidencing the Award is communicated to, or actually received or accepted by, the Participant. In the event that the corporate records (e.g., Board consents, resolutions or minutes) documenting the corporate action constituting the grant contain terms (e.g., exercise price, vesting schedule or number of shares) that are inconsistent with those in the Award Agreement or related grant documents as a result of a clerical error in the papering of the Award Agreement or related grant documents, the corporate records will control and the Participant will have no legally binding right to the incorrect term in the Award Agreement or related grant documents.

 

(c)    Stockholder Rights. No Participant will be deemed to be the holder of, or to have any of the rights of a holder with respect to, any Ordinary Shares subject to an Award unless and until (i) such Participant has satisfied all requirements for exercise of, or the issuance of Ordinary Shares under, the Award pursuant to its terms, and (ii) the issuance of the Ordinary Shares subject to such Award has been entered into the books and records of the Company.

 

(d)    No Employment or Other Service Rights. Nothing in the Plan, any Award Agreement or any other instrument executed thereunder or in connection with any Award granted pursuant thereto will confer upon any Participant any right to continue to serve the Company or an Affiliate in the capacity in effect at the time the Award was granted or will affect the right of the Company or an Affiliate to terminate (i) the employment of an Employee with or without notice and with or without cause, (ii) the service of a Consultant pursuant to the terms of such Consultant’s agreement with the Company or an Affiliate, or (iii) the service of a Director pursuant to the articles of association of the Company or an Affiliate, and any applicable provisions of the corporate law of the jurisdiction in which the Company or the Affiliate is incorporated, as the case may be.

 

(e)    Change in Time Commitment. In the event a Participant’s regular level of time commitment in the performance of his or her services for the Company and any Affiliates is reduced (for example, and without limitation, if the Participant is an Employee of the Company and the Employee has a change in status from a full-time Employee to a part-time Employee or takes an extended leave of absence) after the date of grant of any Award to the Participant, the Board has the right in its sole discretion to (x) make a corresponding reduction in the number of shares or cash amount subject to any portion of such Award that is scheduled to vest or become payable after the date of such change in time commitment, and (y) in lieu of or in combination with such a reduction, extend the vesting or payment schedule applicable to such Award. In the event of any such reduction, the Participant will have no right with respect to any portion of the Award that is so reduced or extended.

 

(f)    Incentive Stock Option Limitations. To the extent that the aggregate Fair Market Value (determined at the time of grant) of Ordinary Shares with respect to which Incentive Stock Options are exercisable for the first time by any Optionholder during any calendar year (under all plans of the Company and any Affiliates) exceeds $100,000 (or such other limit established in the Code) or otherwise does not comply with the rules governing Incentive Stock Options, the Options or portions thereof that exceed such limit (according to the order in which they were granted) or otherwise do not comply with such rules will be treated as Nonstatutory Stock Options, notwithstanding any contrary provision of the applicable Option Agreement(s).

 

(g)    Investment Assurances. The Company may require a Participant, as a condition of exercising or acquiring Ordinary Shares under any Award, (i) to give written assurances satisfactory to the Company as to the Participant’s knowledge and experience in financial and business matters and/or to employ a purchaser representative reasonably satisfactory to the Company who is knowledgeable and experienced in financial and business matters and that such Participant is capable of evaluating, alone or together with the purchaser representative, the merits and risks of exercising the Award; and (ii) to give written assurances satisfactory to the Company stating that the Participant is acquiring Ordinary Shares subject to the Award for the Participant’s own account and not with any present intention of selling or otherwise distributing the Ordinary Shares. The foregoing requirements, and any assurances given pursuant to such requirements, will be inoperative if (A) the issuance of the shares upon the exercise or acquisition of Ordinary Shares under the Award has been registered under a then currently effective registration statement under the Securities Act, or (B) as to any particular requirement, a determination is made by counsel for the Company that such requirement need not be met in the circumstances under the then applicable securities laws. The Company may, upon advice of counsel to the Company, place legends on stock certificates issued under the Plan as such counsel deems necessary or appropriate in order to comply with applicable securities laws, including, but not limited to, legends restricting the transfer of the Ordinary Shares.

 

(h)    Withholding Obligations. Unless prohibited by the terms of an Award Agreement, the Company may, in its sole discretion, satisfy any federal, state or local tax withholding obligation relating to an Award by any of the following means or by a combination of such means: (i) causing the Participant to tender a cash payment; (ii) withholding Ordinary Shares from the Ordinary Shares issued or otherwise issuable to the Participant in connection with the Award; provided, however, that no Ordinary Shares are withheld with a value exceeding the minimum amount of tax required to be withheld by law (or such lesser amount as may be necessary to avoid classification of the Stock Award as a liability for financial accounting purposes); (iii) withholding cash from an Award settled in cash; (iv) withholding payment from any amounts otherwise payable to the Participant; or (v) by such other method as may be set forth in the Award Agreement.

 

(i)    Electronic Delivery. Any reference herein to a “written” agreement or document will include any agreement or document delivered electronically, filed publicly at www.sec.gov (or any successor website thereto) or posted on the Company’s intranet (or other shared electronic medium controlled by the Company to which the Participant has access).

 

(j)    Deferrals. To the extent permitted by applicable law, the Board, in its sole discretion, may determine that the delivery of Ordinary Shares or the payment of cash, upon the exercise, vesting or settlement of all or a portion of any Award may be deferred and may establish programs and procedures for deferral elections to be made by Participants. Deferrals by Participants will be made in accordance with Section 409A of the Code. Consistent with Section 409A of the Code, the Board may provide for distributions while a Participant is still an employee or otherwise providing services to the Company. The Board is authorized to make deferrals of Awards and determine when, and in what annual percentages, Participants may receive payments, including lump sum payments, following the Participant’s termination of Continuous Service, and implement such other terms and conditions consistent with the provisions of the Plan and in accordance with applicable law.

 

(k)    Compliance with Section 409A of the Code. Unless otherwise expressly provided for in an Award Agreement, the Plan and Award Agreements will be interpreted to the greatest extent possible in a manner that makes the Plan and the Awards granted hereunder exempt from Section 409A of the Code, and, to the extent not so exempt, in compliance with Section 409A of the Code. If the Board determines that any Award granted hereunder is not exempt from and is therefore subject to Section 409A of the Code, the Award Agreement evidencing such Award will incorporate the terms and conditions necessary to avoid the consequences specified in Section 409A(a)(1) of the Code, and to the extent an Award Agreement is silent on terms necessary for compliance, such terms are hereby incorporated by reference into the Award Agreement. Notwithstanding anything to the contrary in this Plan (and unless the Award Agreement specifically provides otherwise), if the Ordinary Shares are publicly traded, and if a Participant holding an Award that constitutes “deferred compensation” under Section 409A of the Code is a “specified employee” for purposes of Section 409A of the Code, no distribution or payment of any amount that is due because of a “separation from service” (as defined in Section 409A of the Code without regard to alternative definitions thereunder) will be issued or paid before the date that is six months following the date of such Participant’s “separation from service” (as defined in Section 409A of the Code without regard to alternative definitions thereunder) or, if earlier, the date of the Participant’s death, unless such distribution or payment can be made in a manner that complies with Section 409A of the Code, and any amounts so deferred will be paid in a lump sum on the day after such six month period elapses, with the balance paid thereafter on the original schedule.

 

(l)    Clawback/Recovery. All Awards granted under the Plan will be subject to recoupment in accordance with any clawback policy that the Company is required to adopt pursuant to the listing standards of any national securities exchange or association on which the Company’s securities are listed or as is otherwise required by the Dodd-Frank Wall Street Reform and Consumer Protection Act or other applicable law. In addition, the Board may impose such other clawback, recovery or recoupment provisions in an Award Agreement as the Board determines necessary or appropriate, including but not limited to a reacquisition right in respect of previously acquired Ordinary Shares or other cash or property upon the occurrence of an event constituting Cause. No recovery of compensation under such a clawback policy will be an event giving rise to a right to resign for “good reason” or “constructive termination” (or similar term) under any agreement with the Company.

 

Adjustments upon Changes in Ordinary Shares; Other Corporate Events.

 

(a)    Capitalization Adjustments. In the event of a Capitalization Adjustment, the Board will appropriately and proportionately adjust: (i) the class(es) and maximum number of securities subject to the Plan pursuant to Section 0, (ii) the class(es) and maximum number of securities that may be issued pursuant to the exercise of Incentive Stock Options pursuant to Section 1(k), (iii) the class(es) and maximum number of securities that may be awarded to any person pursuant to Sections (l), and (iv) the class(es) and number of securities and price per share of stock subject to outstanding Stock Awards. The Board will make such adjustments, and its determination will be final, binding and conclusive.

 

(b)    Dissolution or Liquidation. Except as otherwise provided in the Stock Award Agreement, in the event of a dissolution or liquidation of the Company, all outstanding Stock Awards (other than Stock Awards consisting of vested and outstanding Ordinary Shares not subject to a forfeiture condition or the Company’s right of repurchase) will terminate immediately prior to the completion of such dissolution or liquidation, and the Ordinary Shares subject to the Company’s repurchase rights or subject to a forfeiture condition may be repurchased or reacquired by the Company notwithstanding the fact that the holder of such Stock Award is providing Continuous Service; provided, however, that the Board may, in its sole discretion, cause some or all Stock Awards to become fully vested, exercisable and/or no longer subject to repurchase or forfeiture (to the extent such Stock Awards have not previously expired or terminated) before the dissolution or liquidation is completed but contingent on its completion.

 

(c)    Transactions. The following provisions shall apply to Stock Awards in the event of a Transaction unless otherwise provided in the instrument evidencing the Stock Award or any other written agreement between the Company or any Affiliate and the Participant or unless otherwise expressly provided by the Board at the time of grant of a Stock Award. In the event of a Transaction, then, notwithstanding any other provision of the Plan, the Board shall take one or more of the following actions with respect to Stock Awards, contingent upon the closing or completion of the Transaction:

 

arrange for the surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company) to assume or continue the Stock Award or to substitute a similar stock award for the Stock Award (including, but not limited to, an award to acquire the same consideration paid to the stockholders of the Company pursuant to the Transaction);

 

arrange for the assignment of any reacquisition or repurchase rights held by the Company in respect of Ordinary Shares issued pursuant to the Stock Award to the surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company);

 

accelerate the vesting, in whole or in part, of the Stock Award (and, if applicable, the time at which the Stock Award may be exercised) to a date prior to the effective time of such Transaction as the Board shall determine (or, if the Board shall not determine such a date, to the date that is five days prior to the effective date of the Transaction), with such Stock Award terminating if not exercised (if applicable) at or prior to the effective time of the Transaction;

 

arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by the Company with respect to the Stock Award;

 

cancel or arrange for the cancellation of the Stock Award, to the extent not vested or not exercised prior to the effective time of the Transaction, in exchange for such cash consideration, if any, as the Board, in its sole discretion, may consider appropriate; and

 

make a payment, in such form as may be determined by the Board equal to the excess, if any, of (A) the value of the property the Participant would have received upon the exercise of the Stock Award immediately prior to the effective time of the Transaction, over (B) any exercise price payable by such holder in connection with such exercise. For clarity, this payment may be zero ($0) if the value of the property is equal to or less than the exercise price. Payments under this provision may be delayed to the same extent that payment of consideration to the holders of Ordinary Shares in connection with the Transaction is delayed as a result of escrows, earn outs, holdbacks or other contingencies.

 

The Board need not take the same action or actions with respect to all Stock Awards or portions thereof or with respect to all Participants. The Board may take different actions with respect to the vested and unvested portions of a Stock Award.

 

(d)    Change in Control. A Stock Award may be subject to additional acceleration of vesting and exercisability upon or after a Change in Control as may be provided in the Stock Award Agreement for such Stock Award or as may be provided in any other written agreement between the Company or any Affiliate and the Participant, but in the absence of such provision, no such acceleration will occur.

 

Plan Term; Earlier Termination or Suspension of the Plan.

 

The Board may suspend or terminate the Plan at any time. No Incentive Stock Options may be granted after the tenth anniversary of the earlier of (i) the date the Plan is adopted by the Board (the “Adoption Date”), or (ii) the date the Plan is approved by the stockholders of the Company. No Awards may be granted under the Plan while the Plan is suspended or after it is terminated.

 

Existence of the Plan; Timing of First Grant or Exercise.

 

The Plan will come into existence on the Adoption Date; provided, however, that no Award may be granted prior to the IPO Date (that is, the Effective Date). In addition, no Stock Award will be exercised (or, in the case of a Restricted Stock Award, Restricted Stock Unit Award, Performance Stock Award, or Other Stock Award, no Stock Award will be granted) and no Performance Cash Award will be settled unless and until the Plan has been approved by the stockholders of the Company, which approval will be within 12 months after the date the Plan is adopted by the Board.

 

Choice of Law.

 

The Plan, all determinations made and actions taken pursuant hereto and, except as provided below or in an applicable subplan, each Award Agreement to a Participant shall be governed by the laws of the State of Israel, excluding matters that are subject to tax laws, regulations and rules, or conflicts or choice of law rule or principles, of any specific jurisdiction, which shall be governed by the respective laws, regulations and rules of such jurisdiction.

 

Definitions. As used in the Plan, the following definitions will apply to the capitalized terms indicated below:

 

(a)“    Affiliate” means, at the time of determination, any “parent” or “subsidiary” of the Company as such terms are defined in Rule 405 of the Securities Act. The Board will have the authority to determine the time or times at which “parent” or “subsidiary” status is determined within the foregoing definition.

 

(b)“    Award” means a Stock Award or a Performance Cash Award.

 

(c)“    Award Agreement” means a written agreement between the Company and a Participant evidencing the terms and conditions of an Award.

 

(d)“    Board” means the Board of Directors of the Company.

 

(e)     “Capitalization Adjustment” means any change that is made in, or other events that occur with respect to, the Ordinary Shares subject to the Plan or subject to any Stock Award after the Adoption Date without the receipt of consideration by the Company through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, large nonrecurring cash dividend, stock split, reverse stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or any similar equity restructuring transaction, as that term is used in Statement of Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor thereto). Notwithstanding the foregoing, the conversion of any convertible securities of the Company will not be treated as a Capitalization Adjustment.

 

(f)“    Cause” will have the meaning ascribed to such term in any written agreement between the Participant and the Company defining such term and, in the absence of such agreement, such term means, with respect to a Participant, the occurrence of any of the following events: (i) such Participant’s commission of any felony or any crime involving fraud, dishonesty or moral turpitude under the laws of the United States or any state thereof; (ii) such Participant’s attempted commission of, or participation in, a fraud or act of dishonesty against the Company; (iii) such Participant’s intentional, material violation of any contract or agreement between the Participant and the Company or of any statutory duty owed to the Company; (iv) such Participant’s unauthorized use or disclosure of the Company’s confidential information or trade secrets; or (v) such Participant’s gross misconduct. The determination that a termination of the Participant’s Continuous Service is either for Cause or without Cause will be made by the Company, in its sole discretion. Any determination by the Company that the Continuous Service of a Participant was terminated with or without Cause for the purposes of outstanding Awards held by such Participant will have no effect upon any determination of the rights or obligations of the Company or such Participant for any other purpose.

 

(g)     “Change in Control” means the occurrence, in a single transaction or in a series of related transactions, of any one or more of the following events:

 

any Exchange Act Person becomes the Owner, directly or indirectly, of securities of the Company representing more than 50% of the combined voting power of the Company’s then outstanding securities other than by virtue of a merger, consolidation or similar transaction. Notwithstanding the foregoing, a Change in Control will not be deemed to occur (A) on account of the acquisition of securities of the Company directly from the Company, (B) on account of the acquisition of securities of the Company by an investor, any affiliate thereof or any other Exchange Act Person that acquires the Company’s securities in a transaction or series of related transactions the primary purpose of which is to obtain financing for the Company through the issuance of equity securities, (C) on account of the acquisition of securities of the Company by any individual who is, on the Adoption Date, either an executive officer or a Director (either, a “Legacy Investor”) and/or any entity in which a Legacy Investor has a direct or indirect interest (whether in the form of voting rights or participation in profits or capital contributions) of more than 50% (collectively, the “Legacy Entities”) or on account of the Legacy Entities continuing to hold shares that come to represent more than 50% of the combined voting power of the Company’s then outstanding securities as a result of the conversion of any class of the Company’s securities into another class of the Company’s securities having a different number of votes per share pursuant to the conversion provisions set forth in the Company’s articles of association; or (D) solely because the level of Ownership held by any Exchange Act Person (the “Subject Person”) exceeds the designated percentage threshold of the outstanding voting securities as a result of a repurchase or other acquisition of voting securities by the Company reducing the number of shares outstanding, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of voting securities by the Company, and after such share acquisition, the Subject Person becomes the Owner of any additional voting securities that, assuming the repurchase or other acquisition had not occurred, increases the percentage of the then outstanding voting securities Owned by the Subject Person over the designated percentage threshold, then a Change in Control will be deemed to occur;

 

there is consummated a merger, consolidation or similar transaction involving (directly or indirectly) the Company and, immediately after the consummation of such merger, consolidation or similar transaction, the stockholders of the Company immediately prior thereto do not Own, directly or indirectly, either (A) outstanding voting securities representing more than 50% of the combined outstanding voting power of the surviving Entity in such merger, consolidation or similar transaction or (B) more than 50% of the combined outstanding voting power of the parent of the surviving Entity in such merger, consolidation or similar transaction, in each case in substantially the same proportions as their Ownership of the outstanding voting securities of the Company immediately prior to such transaction; provided, however, that a merger, consolidation or similar transaction will not constitute a Change in Control under this prong of the definition if the outstanding voting securities representing more than 50% of the combined voting power of the surviving Entity or its parent are owned by the Legacy Entities;

 

there is consummated a sale, lease, exclusive license or other disposition of all or substantially all of the consolidated assets of the Company and its Subsidiaries, other than a sale, lease, license or other disposition of all or substantially all of the consolidated assets of the Company and its Subsidiaries to an Entity, more than 50% of the combined voting power of the voting securities of which are Owned by stockholders of the Company in substantially the same proportions as their Ownership of the outstanding voting securities of the Company immediately prior to such sale, lease, license or other disposition; provided, however, that a sale, lease, exclusive license or other disposition of all or substantially all of the consolidated assets of the Company and its Subsidiaries will not constitute a Change in Control under this prong of the definition if the outstanding voting securities representing more than 50% of the combined voting power of the acquiring Entity or its parent are owned by the Legacy Entities;

 

the stockholders of the Company approve or the Board approves a plan of complete dissolution or liquidation of the Company, or a complete dissolution or liquidation of the Company will otherwise occur, except for a liquidation into a parent corporation; or

 

individuals who, on the date the Plan is adopted by the Board, are members of the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the members of the Board; provided, however, that if the appointment or election (or nomination for election) of any new Board member was approved or recommended by a majority vote of the members of the Incumbent Board then still in office, such new member will, for purposes of this Plan, be considered as a member of the Incumbent Board.

 

Notwithstanding the foregoing definition or any other provision of the Plan, the term Change in Control will not include a sale of assets, merger or other transaction effected exclusively for the purpose of changing the domicile of the Company and the definition of Change in Control (or any analogous term) in an individual written agreement between the Company or any Affiliate and the Participant will supersede the foregoing definition with respect to Awards subject to such agreement; provided, however, that if no definition of Change in Control or any analogous term is set forth in such an individual written agreement, the foregoing definition will apply.

 

(h)“    Code” means the Internal Revenue Code of 1986, as amended, including any applicable regulations and guidance thereunder.

 

(i)“    Committee” means a committee of one or more Directors to whom authority has been delegated by the Board in accordance with Section 1(f).

 

“Company” means UroGen Pharma Ltd., an Israeli corporation.

 

(j)“    Consultant” means any person, including an advisor, who is (i) engaged by the Company or an Affiliate to render consulting or advisory services and is compensated for such services, or (ii) serving as a member of the board of directors of an Affiliate and is compensated for such services. However, service solely as a Director, or payment of a fee for such service, will not cause a Director to be considered a “Consultant” for purposes of the Plan.  Notwithstanding the foregoing, a person is treated as a Consultant under this Plan only if a Form S-8 Registration Statement under the Securities Act is available to register either the offer or the sale of the Company’s securities to such person.

 

“Continuous Service” means that the Participant’s service with the Company or an Affiliate, whether as an Employee, Director or Consultant, is not interrupted or terminated. A change in the capacity in which the Participant renders service to the Company or an Affiliate as an Employee, Consultant or Director or a change in the entity for which the Participant renders such service, provided that there is no interruption or termination of the Participant’s service with the Company or an Affiliate, will not terminate a Participant’s Continuous Service; provided, however, that if the Entity for which a Participant is rendering services ceases to qualify as an Affiliate, as determined by the Board, in its sole discretion, such Participant’s Continuous Service will be considered to have terminated on the date such Entity ceases to qualify as an Affiliate. To the extent permitted by law, the Board or the chief executive officer of the Company, in that party’s sole discretion, may determine whether Continuous Service will be considered interrupted in the case of (i) any leave of absence approved by the Board or chief executive officer, including sick leave, military leave or any other personal leave, or (ii) transfers between the Company, an Affiliate, or their successors. Notwithstanding the foregoing, a leave of absence will be treated as Continuous Service for purposes of vesting in an Award only to such extent as may be provided in the Company’s leave of absence policy, in the written terms of any leave of absence agreement or policy applicable to the Participant, or as otherwise required by law. In addition, to the extent required for exemption from or compliance with Section 409A of the Code, the determination of whether there has been a termination of Continuous Service will be made, and such term will be construed, in a manner that is consistent with the definition of “separation from service” as defined under Treasury Regulation Section 1.409A-1(h) (without regard to any alternative definition thereunder).

 

(k)“    Corporate Transaction” the consummation, in a single transaction or in a series of related transactions, of any one or more of the following events:

 

a sale or other disposition of all or substantially all, as determined by the Board, in its sole discretion, of the consolidated assets of the Company and its Subsidiaries;

 

a sale or other disposition of more than 50% of the outstanding securities of the Company;

 

a merger, consolidation or similar transaction following which the Company is not the surviving corporation; or

 

a merger, consolidation or similar transaction following which the Company is the surviving corporation but the Ordinary Shares outstanding immediately preceding the merger, consolidation or similar transaction are converted or exchanged by virtue of the merger, consolidation or similar transaction into other property, whether in the form of securities, cash or otherwise.

 

(l)“    Covered Employee” will have the meaning provided in Section 162(m)(3) of the Code.

 

(m)“    Director” means a member of the Board.

 

(n)“    Disability” means, with respect to a Participant, the inability of such Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or that has lasted or can be expected to last for a continuous period of not less than 12 months, as provided in Sections 22(e)(3) and 409A(a)(2)(c)(i) of the Code, and will be determined by the Board on the basis of such medical evidence as the Board deems warranted under the circumstances.

 

(o)“    Effective Date” means the IPO Date.

 

(p)“    Employee” means any person employed by the Company or an Affiliate. However, service solely as a Director, or payment of a fee for such services, will not cause a Director to be considered an “Employee” for purposes of the Plan.

 

(q)“    Entity” means a corporation, partnership, limited liability company or other entity.

 

(r)“    Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

(s)“    Exchange Act Person” means any natural person, Entity or “group” (within the meaning of Section 13(d) or 14(d) of the Exchange Act), except that “Exchange Act Person” will not include (i) the Company or any Subsidiary of the Company, (ii) any employee benefit plan of the Company or any Subsidiary of the Company or any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any Subsidiary of the Company, (iii) an underwriter temporarily holding securities pursuant to a registered public offering of such securities, (iv) an Entity Owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their Ownership of stock of the Company; or (v) any natural person, Entity or “group” (within the meaning of Section 13(d) or 14(d) of the Exchange Act) that, as of the Effective Date, is the Owner, directly or indirectly, of securities of the Company representing more than 50% of the combined voting power of the Company’s then outstanding securities.

 

(t)“    Fair Market Value” means, as of any date, the value of the Ordinary Shares determined as follows:

 

If the Ordinary Shares are listed on any established stock exchange or traded on any established market, the Fair Market Value of an Ordinary Share will be, unless otherwise determined by the Board, the closing sales price for such stock as quoted on such exchange or market (or the exchange or market with the greatest volume of trading in the Ordinary Shares) on the date of determination, as reported in a source the Board deems reliable.

 

Unless otherwise provided by the Board, if there is no closing sales price for the Ordinary Shares on the date of determination, then the Fair Market Value will be the closing selling price on the last preceding date for which such quotation exists.

 

In the absence of such markets for the Ordinary Shares, the Fair Market Value will be determined by the Board in good faith and in a manner that complies with Sections 409A and 422 of the Code.

 

(u)“    Incentive Stock Option” means an option granted pursuant to Section 0 of the Plan that is intended to be, and qualifies as, an “incentive stock option” within the meaning of Section 422 of the Code.

 

(v)“    IPO Date” means the date of the underwriting agreement between the Company and the underwriter(s) managing the initial public offering of the Ordinary Shares, pursuant to which the Ordinary Shares are priced for the initial public offering.

 

(w)“    Non-Employee Director” means a Director who either (i) is not a current employee or officer of the Company or an Affiliate, does not receive compensation, either directly or indirectly, from the Company or an Affiliate for services rendered as a consultant or in any capacity other than as a Director (except for an amount as to which disclosure would not be required under Item 404(a) of Regulation S-K promulgated pursuant to the Securities Act (“Regulation S-K”)), does not possess an interest in any other transaction for which disclosure would be required under Item 404(a) of Regulation S-K, and is not engaged in a business relationship for which disclosure would be required pursuant to Item 404(b) of Regulation S-K; or (ii) is otherwise considered a “non-employee director” for purposes of Rule 16b-3.

 

(x)“    Nonstatutory Stock Option” means any Option granted pursuant to Section 0 of the Plan that does not qualify as an Incentive Stock Option.

 

(y)“    Officer” means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act.

 

(z)“    Option” means an Incentive Stock Option or a Nonstatutory Stock Option to purchase Ordinary Shares granted pursuant to the Plan.

 

(aa)“    Option Agreement” means a written agreement between the Company and an Optionholder evidencing the terms and conditions of an Option grant. Each Option Agreement will be subject to the terms and conditions of the Plan.

 

(bb)“    Optionholder” means a person to whom an Option is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding Option.

 

(cc)“    Ordinary Shares” means the Ordinary Shares of the Company, par value NIS 0.01 per Ordinary Share.

 

(dd)“    Other Stock Award” means an award based in whole or in part by reference to the Ordinary Shares which is granted pursuant to the terms and conditions of Section 1(ee).

 

(ee)“    Other Stock Award Agreement” means a written agreement between the Company and a holder of an Other Stock Award evidencing the terms and conditions of an Other Stock Award grant. Each Other Stock Award Agreement will be subject to the terms and conditions of the Plan.

 

(ff)“    Outside Director” means a Director who either (i) is not a current employee of the Company or an “affiliated corporation” (within the meaning of Treasury Regulations promulgated under Section 162(m) of the Code), is not a former employee of the Company or an “affiliated corporation” who receives compensation for prior services (other than benefits under a tax-qualified retirement plan) during the taxable year, has not been an officer of the Company or an “affiliated corporation,” and does not receive remuneration from the Company or an “affiliated corporation,” either directly or indirectly, in any capacity other than as a Director, or (ii) is otherwise considered an “outside director” for purposes of Section 162(m) of the Code.

 

(gg)“    Own,” “Owned,” “Owner,” “Ownership” means a person or Entity will be deemed to “Own,” to have “Owned,” to be the “Owner” of, or to have acquired “Ownership” of securities if such person or Entity, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, has or shares voting power, which includes the power to vote or to direct the voting, with respect to such securities.

 

(hh)“    Participant” means a person to whom an Award is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding Stock Award.

 

(ii)“    Performance Cash Award” means an award of cash granted pursuant to the terms and conditions of Section 0.

 

“Performance Criteria” means the one or more criteria that the Board or the Committee will select for purposes of establishing the Performance Goals for a Performance Period. The Performance Criteria that will be used to establish such Performance Goals may be based on any one of, or combination of, the following as determined by the Board or the Committee: (i) earnings (including earnings per share and net earnings); (ii) earnings before interest, taxes and depreciation; (iii) earnings before interest, taxes, depreciation and amortization; (iv) earnings before interest, taxes, depreciation, amortization and legal settlements; (v) earnings before interest, taxes, depreciation, amortization, legal settlements and other income (expense); (vi) earnings before interest, taxes, depreciation, amortization, legal settlements, other income (expense) and stock-based compensation; (vii) earnings before interest, taxes, depreciation, amortization, legal settlements, other income (expense), stock-based compensation and changes in deferred revenue; (viii) earnings before interest, taxes, depreciation, amortization, legal settlements, other income (expense), stock-based compensation, other non-cash expenses and changes in deferred revenue; (ix) total stockholder return; (x) return on equity or average stockholder’s equity; (xi) return on assets, investment, or capital employed; (xii) stock price; (xiii) margin (including gross margin); (xiv) income (before or after taxes); (xv) operating income; (xvi) operating income after taxes; (xvii) pre-tax profit; (xviii) operating cash flow; (xix) sales or revenue targets; (xx) increases in revenue or product revenue; (xxi) expenses and cost reduction goals; (xxii) improvement in or attainment of working capital levels; (xxiii) economic value added (or an equivalent metric); (xxiv) market share; (xxv) cash flow; (xxvi) cash flow per share; (xxvii) cash balance; (xxviii) cash burn; (xxix) cash collections; (xxx) share price performance; (xxxi) debt reduction; (xxxii) implementation or completion of projects or processes (including, without limitation, clinical trial initiation, clinical trial enrollment and dates, clinical trial results, regulatory filing submissions, regulatory filing acceptances, regulatory or advisory committee interactions, regulatory approvals, and product supply); (xxxiii) stockholders’ equity; (xxxiv) capital expenditures; (xxxv) debt levels; (xxxvi) operating profit or net operating profit; (xxxvii) workforce diversity; (xxxviii) growth of net income or operating income; (xxxix) billings; (xl) bookings; (xli) employee retention; (xlii) initiation of studies by specific dates; (xliii) budget management; (xliv) submission to, or approval by, a regulatory body (including, but not limited to the U.S. Food and Drug Administration) of an applicable filing or a product; (xlv) regulatory milestones; (xlvi) progress of internal research or development programs; (xlvii) acquisition of new customers; (xlviii) customer retention and/or repeat order rate; (xlix) improvements in sample and test processing times; (l) progress of partnered programs; (li) partner satisfaction; (lii) timely completion of clinical trials; (liii) submission of pre-market approvals and other regulatory achievements; (liv) milestones related to research development (including, but not limited to, preclinical and clinical studies), product development and manufacturing; (lv) expansion of sales in additional geographies or markets; (lvi) research progress, including the development of programs; (lvii) strategic partnerships or transactions (including in-licensing and out-licensing of intellectual property; and (lviii) and to the extent that an Award is not intended to comply with Section 162(m) of the Code, other measures of performance selected by the Board or the Committee.

 

“Performance Goals” means, for a Performance Period, the one or more goals established by the Board or the Committee for the Performance Period based upon the Performance Criteria. Performance Goals may be based on a Company-wide basis, with respect to one or more business units, divisions, Affiliates, or business segments, and in either absolute terms or relative to the performance of one or more comparable companies or the performance of one or more relevant indices. Unless specified otherwise by the Board or the Committee (i) in the Award Agreement at the time the Award is granted or (ii) in such other document setting forth the Performance Goals at the time the Performance Goals are established, the Board or the Committee will appropriately make adjustments in the method of calculating the attainment of Performance Goals for a Performance Period as follows: (1) to exclude restructuring and/or other nonrecurring charges; (2) to exclude exchange rate effects; (3) to exclude the effects of changes to generally accepted accounting principles; (4) to exclude the effects of any statutory adjustments to corporate tax rates; (5) to exclude the effects of any “unusual or infrequently occurring items” as determined under generally accepted accounting principles; (6) to exclude the dilutive effects of acquisitions or joint ventures; (7) to assume that any business divested by the Company achieved performance objectives at targeted levels during the balance of a Performance Period following such divestiture; (8) to exclude the effect of any change in the outstanding Ordinary Shares of the Company by reason of any stock dividend or split, stock repurchase, reorganization, recapitalization, merger, consolidation, spin-off, combination or exchange of shares or other similar corporate change, or any distributions to Ordinary Shareholders other than regular cash dividends; (9) to exclude the effects of stock based compensation and the award of bonuses under the Company’s bonus plans; (10) to exclude costs incurred in connection with potential acquisitions or divestitures that are required to be expensed under generally accepted accounting principles; (11) to exclude the goodwill and intangible asset impairment charges that are required to be recorded under generally accepted accounting principles; and (12) to exclude the effect of any other unusual, non-recurring gain or loss or other extraordinary item. In addition, the Board or the Committee retains the discretion to reduce or eliminate the compensation or economic benefit due upon attainment of Performance Goals and to define the manner of calculating the Performance Criteria it selects to use for such Performance Period. Partial achievement of the specified criteria may result in the payment or vesting corresponding to the degree of achievement as specified in the Stock Award Agreement or the written terms of a Performance Cash Award.

 

(jj)“    Performance Period” means the period of time selected by the Board or the Committee over which the attainment of one or more Performance Goals will be measured for the purpose of determining a Participant’s right to and the payment of a Stock Award or a Performance Cash Award. Performance Periods may be of varying and overlapping duration, at the sole discretion of the Board or the Committee.

 

(kk)“    Performance Stock Award” means a Stock Award granted under the terms and conditions of Section 0.

 

“Plan” means this UroGen Pharma Ltd. 2017 Equity Incentive Plan, as it may be amended.

 

(ll)“    Restricted Stock Award” means an award of Ordinary Shares which is granted pursuant to the terms and conditions of Section 1(bb).

 

(mm)“    Restricted Stock Award Agreement” means a written agreement between the Company and a holder of a Restricted Stock Award evidencing the terms and conditions of a Restricted Stock Award grant. Each Restricted Stock Award Agreement will be subject to the terms and conditions of the Plan.

 

(nn)“    Restricted Stock Unit Award” means a right to receive Ordinary Shares which is granted pursuant to the terms and conditions of Section 1(cc).

 

(oo)“    Restricted Stock Unit Award Agreement” means a written agreement between the Company and a holder of a Restricted Stock Unit Award evidencing the terms and conditions of a Restricted Stock Unit Award grant. Each Restricted Stock Unit Award Agreement will be subject to the terms and conditions of the Plan.

 

(pp)“    Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any successor to Rule 16b-3, as in effect from time to time.

 

(qq)“    Securities Act” means the Securities Act of 1933, as amended.

 

(rr)“    Stock Appreciation Right” or “SAR” means a right to receive the appreciation on Ordinary Shares that is granted pursuant to the terms and conditions of Section 0.

 

(ss)“    Stock Appreciation Right Agreement” means a written agreement between the Company and a holder of a Stock Appreciation Right evidencing the terms and conditions of a Stock Appreciation Right grant. Each Stock Appreciation Right Agreement will be subject to the terms and conditions of the Plan.

 

(tt)“    Stock Award” means any right to receive Ordinary Shares granted under the Plan, including an Incentive Stock Option, a Nonstatutory Stock Option, a Restricted Stock Award, a Restricted Stock Unit Award, a Stock Appreciation Right, a Performance Stock Award or any Other Stock Award.

 

(uu)“    Stock Award Agreement” means a written agreement between the Company and a Participant evidencing the terms and conditions of a Stock Award grant. Each Stock Award Agreement will be subject to the terms and conditions of the Plan.

 

(vv)“    Subsidiary” means, with respect to the Company, (i) any corporation of which more than 50% of the outstanding ordinary shares having ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether, at the time, stock of any other class or classes of such corporation will have or might have voting power by reason of the happening of any contingency) is at the time, directly or indirectly, Owned by the Company, and (ii) any partnership, limited liability company or other entity in which the Company has a direct or indirect interest (whether in the form of voting or participation in profits or capital contribution) of more than 50%.

 

(ww)“    Ten Percent Stockholder” means a person who Owns (or is deemed to Own pursuant to Section 424(d) of the Code) stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or any Affiliate.

 

(xx)    "Transaction" means a Corporate Transaction or a Change in Control.

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