Document:

Document

F5, Inc.
Incentive Plan

1. PURPOSES.
(a) Eligible Award Recipients. The persons eligible to receive Awards are the Employees, Directors and Consultants of the Company and its Affiliates.
(b) Available Awards. The purpose of the Plan is to provide a means by which eligible recipients of Awards may be given an opportunity to benefit from increases in value of the Common Stock or from Company performance through the granting of Awards.
(c) General Purpose. The Company, by means of the Plan, seeks to retain the services of the group of persons eligible to receive Awards, to secure and retain the services of new members of this group and to provide incentives for such persons to exert maximum efforts for the success of the Company and its Affiliates.

2. DEFINITIONS.
(a) “Affiliate” means any parent corporation or subsidiary corporation of the Company, whether now or hereafter existing, as those terms are defined in Sections 424(e) and (f), respectively, of the Code.
(b) “Applicable Laws” means the legal requirements relating to the administration of equity compensation plans, including under applicable U.S. state corporate laws, U.S. federal and applicable state securities laws, other U.S. federal and state laws, the Code, any stock exchange rules or regulations and the applicable laws, rules and regulations of any other country or jurisdiction where Awards are granted under the Plan, as such laws, rules, regulations and requirements shall be in place from time to time.
(c) “Award” means any right granted under the Plan, including an Option, Stock Award, Stock Unit, Stock Appreciation Right, Performance Share, Performance Unit, cash-based award or other incentive payable in cash or in Shares as may be designated by the Committee from time to time.
(d) “Award Agreement” means a written or electronic agreement between the Company and a holder of an Award evidencing the terms and conditions of an individual Award grant. Each Award Agreement shall be subject to the terms and conditions of the Plan.
(e) “Board” means the Board of Directors of the Company.
(f) “Code” means the Internal Revenue Code of 1986, as amended.
(g) “Committee” means a committee appointed by the Board in accordance with subsection 3(c).
(h) “Common Stock” means the common stock of the Company.
(i) “Company” means F5, Inc., a Washington corporation.
(j) “Consultant” means any person, including an advisor, (i) who is engaged by the Company or an Affiliate to render services other than as an Employee or as a Director or (ii) who is a member of the Board of Directors of an Affiliate.
(k) “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. The Participant’s Continuous Service shall not be deemed to have terminated merely because of 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 among the Company or an Affiliate for which the Participant renders such service, provided that there is no interruption or termination of the Participant’s Continuous Service. 
For example, a change in status from an Employee of the Company to a Consultant of an Affiliate or a Director of the Company will not constitute an interruption of Continuous Service. Subject to Section 14(b), the Board or the chief executive officer of the Company, in that party’s sole discretion, may determine whether Continuous Service shall be considered interrupted in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal leave.
(l) “Covered Employee” means the chief executive officer and the three (3) other highest compensated officers of the Company (other than the chief executive officer and chief financial officer) for 

whom total compensation is required to be reported to shareholders under the Exchange Act, as determined for purposes of Prior Section 162(m) of the Code.
(m) “Director” means a member of the Board of Directors of the Company.
(n) “Disability” means the permanent and total disability of a person within the meaning of Section 22(e)(3) of the Code.
(o) “Employee” means any person employed by the Company or an Affiliate. Subject to the Applicable Laws, the determination of whether an individual (including leased and temporary employees) is an Employee hereunder shall be made by the Board (or its Committee), in its sole discretion. Mere service as a Director or payment of a director’s fee by the Company or an Affiliate shall not be sufficient to constitute “employment” by the Company or an Affiliate.
(p) “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(q) “Fair Market Value” means, as of any date, the value of the Common Stock as determined in good faith by the Committee. Unless otherwise determined by the Committee, if the Common Stock is listed on any established stock exchange, the Fair Market Value of a Share shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or market (or such other exchange or market with the greatest volume of trading in the Common Stock) on the day of determination or, if the day of determination is not a market trading day, then on the last market trading day prior to the day of determination.
(r) “Independent Director” means a Director who qualifies as an “independent” director under applicable Nasdaq rules (or the rules of any exchange on which the Common Stock is then listed or approved for listing).
(s) “Non-Employee Director” means a Director of the Company who either (i) is not a current Employee or Officer of the Company or its parent or a subsidiary, does not receive compensation (directly or indirectly) from the Company or its parent or a subsidiary 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”)) and does not possess an interest in any other transaction as to which disclosure would be required under Item 404(a) of Regulation S-K; or (ii) is otherwise considered a “non-employee director” for purposes of Rule 16b-3.
(t) “Officer” means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.
(u) “Option” means a nonstatutory stock option (meaning, an option not intended to qualify as an incentive stock option under Code Section 422) granted pursuant to the Plan.
(v) “Outside Director” means a Director of the Company who either (i) is not a current Employee of the Company or an “affiliated corporation” (within the meaning of Treasury Regulations promulgated under Prior Section 162(m) of the Code), is not a former Employee of the Company or an “affiliated corporation” receiving compensation for prior services (other than benefits under a tax qualified pension plan), was not an officer of the Company or an “affiliated corporation” at any time and is not currently receiving direct or indirect remuneration from the Company or an “affiliated corporation” for services in any capacity other than as a Director or (ii) is otherwise considered an “outside director” for purposes of Prior Section 162(m) of the Code.
(w) “Participant” means a person to whom an Award is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding Award.
(x) “Plan” means this F5, Inc. Incentive Plan.
(y) “Prior Section 162(m) of the Code” means Section 162(m) of the Code as in effect prior to the amendments made to Section 162(m) of the Code by Section 13601 of the Tax Cuts and Jobs Act of 2017.
(z) “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.
(aa) “Securities Act” means the Securities Act of 1933, as amended.

(bb) “Share” means a share of the Common Stock, as adjusted in accordance with Section 15 below.
(cc) “Stock Appreciation Right” means a right granted under Section 8 to receive the excess of the Fair Market Value of a specified number of Shares over the grant price.
(dd) “Stock Award” means an Award of Shares granted under Section 7 below, the rights of ownership of which may or may not be subject to restrictions prescribed by the Committee.
(ee) “Stock Unit” means an Award giving the right to receive Shares granted under Section 7 below.
(ff) “Substitute Award” means an Award granted in connection with a transaction in substitution, exchange, conversion, adjustment, assumption or replacement of awards previously granted by an entity acquired by the Company or an Affiliate or with which the Company or an Affiliate merges or otherwise combines.

3. ADMINISTRATION.
(a) Administration by Board. The Board shall administer the Plan unless and until the Board delegates administration to a Committee or an administrator, as provided in subsection 3(c).
(b) Powers of Board. The Board shall have the power, subject to, and within the limitations of, the express provisions of the Plan:
(i) To determine from time to time which of the persons eligible under the Plan shall be granted Awards; when and how each Award shall be granted; what type or combination of types of Awards shall be granted; the provisions, terms and conditions of each Award granted (which need not be identical as among Participants or as among types of Awards), including, without limitation: the time or times when a person shall be permitted to receive Shares or dollars pursuant to an Award, the number of Shares (if any) or dollars (if any) with respect to which an Award shall be granted to each such person, the exercise or purchase price (if any) of an Award, the time or times when Awards may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, any pro rata adjustment to vesting as a result of a Participant’s transitioning from full- to part-time service (or vice versa), and any other restriction (including forfeiture restriction), limitation or term of any Award, based in each case on such factors as the Board, in its sole discretion, shall determine; provided, however, that such provisions, terms and conditions are not inconsistent with the terms of the Plan.
(ii) In order to fulfill the purposes of the Plan and without amending the Plan, to modify grants of Awards to Participants who are foreign nationals or employed outside of the United States in order to recognize differences in local law, tax policies or customs.
(iii) To construe and interpret the Plan and Awards granted under it, and to establish, amend and revoke rules and regulations for its administration. The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan or in any Award Agreement, in a manner and to the extent it shall deem necessary or expedient to make the Plan fully effective.
(iv) To amend the Plan or an Award as provided in Section 16.
(v) 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 which are not in conflict with the provisions of the Plan.
(c) Delegation to Committee. The Board may delegate administration of the Plan to a Committee or Committees of one or more members of the Board, and the term “Committee” shall apply to any person or persons to whom such authority has been delegated. In the discretion of the Board, the Committee may consist solely of two or more Outside Directors, in accordance with Prior Section 162(m) of the Code, and/or solely of two or more Non-Employee Directors, in accordance with Rule 16b-3, and/or solely of two or more Independent Directors under applicable Nasdaq (or other exchange) rules. The Board or the Committee may further delegate its authority and responsibilities under the Plan to an Officer. However, if administration is delegated to an Officer, such Officer may grant Awards only within guidelines established by the Board or the Committee, and only the Board or the Committee may make an Award to an Officer or Director. If administration is delegated to a Committee, the Committee shall have, in connection with the administration of the Plan, the powers theretofore possessed by the Board, including the power to 

delegate to a subcommittee any of the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board shall thereafter be to the Committee or subcommittee, or an Officer to whom authority has been delegated), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any time and revest in the Board the administration of the Plan, and unless otherwise specified by the Board shall retain any authority granted to a committee or individual hereunder unto itself.

4. SHARES SUBJECT TO THE PLAN.
(a) Share Reserve. Subject to the provisions of Section 15 relating to adjustments upon changes in stock, the stock that may be issued pursuant to Awards, shall not exceed in the aggregate Twenty-Three Million Three Hundred Eighty Thousand (23,380,000) Shares of Common Stock. Substitute Awards may be granted under the Plan and such Substitute Awards shall not reduce the aggregate number of Shares available for Awards under the Plan.
(b) Limitation on Awards. No Employee shall be eligible to be granted Awards covering more than Two Million (2,000,000) Shares during any fiscal year of the Company.
(c) Reversion of Shares to the Share Reserve. If any Award shall for any reason expire or otherwise terminate, in whole or in part, without having been exercised or settled in full, the Shares not acquired under such Award shall revert to and again become available for issuance under the Plan. Further, if any previously-issued Shares are forfeited under the terms and conditions of the Award, then any Shares so forfeited shall revert to and again become available for issuance under the Plan. The provisions of this Section 4(c) are qualified by Section 4(a) such that the total number of Shares issued and outstanding under the Plan at any time may not exceed the number set forth in Section 4(a) (as adjusted under Section 15).
(d) Source of Shares. The stock subject to the Plan may be unissued Shares or reacquired Shares, bought on the market or otherwise.

5. ELIGIBILITY.
Awards may be granted to Employees, Directors and Consultants.

6. OPTION PROVISIONS.
Each Option shall be in such form and shall contain such terms and conditions as the Board shall deem appropriate. The provisions of separate Options need not be identical, but each Option shall include (through incorporation of provisions hereof by reference in the Option or otherwise) the substance of each of the following provisions:
(a) Term. No Option shall be exercisable after the expiration of ten (10) years from the date it was granted.
(b) Exercise Price of an Option. The exercise price of each Option shall be at least equal to the Fair Market Value of the stock subject to the Option on the date the Option is granted. Notwithstanding the foregoing, an Option may be granted as a Substitute Award with an exercise price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of Section 424(a) of the Code.
(c) Consideration. The purchase price of stock acquired pursuant to an Option shall be paid, to the extent permitted by applicable statutes and regulations, either (i) in cash, check or wire transfer at the time the Option is exercised or (ii) at the discretion of the Board at the time of the grant of the Option or subsequently by (1) by delivery to the Company of other Shares that have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which the Option is exercised, (2) if, as of the date of exercise of an Option the Company then is permitting Employees to engage in a “same-day sale” cashless brokered exercise program involving one or more brokers, through such a program that complies with the Applicable Laws (including without limitation the requirements of Regulation T and other applicable regulations promulgated by the Federal Reserve Board) and that ensures prompt delivery to the Company of the amount required to pay the exercise price and any applicable withholding taxes, (3) in any other form of legal consideration that may be acceptable to the 

Board, or (4) any combination of the foregoing methods. In making its determination as to the type of consideration to accept, the Board shall consider if acceptance of such consideration may be reasonably expected to benefit the Company and the Board may, in its sole discretion, refuse to accept a particular form of consideration at the time of any Option exercise.
(d) Transferability of an Option. The Option shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during the lifetime of the Participant only by the Participant.
(e) Vesting. The total number of Shares of Common Stock subject to an Option may, but need not, vest and therefore become exercisable in periodic installments which may, but need not, be equal. The Option may be subject to such other terms and conditions on the time or times when it may be exercised (which may be based on performance or other criteria) as the Board may deem appropriate. The vesting provisions of individual Options may vary. The provisions of this subsection 6(e) are subject to any Option provisions governing the minimum number of Shares as to which an Option may be exercised.
(f) Termination of Continuous Service. In the event a Participant’s Continuous Service terminates (other than upon the Participant’s death or Disability), the Participant may exercise his or her Option (to the extent that the Participant was vested in the Option Shares and entitled to exercise such Option as of the date of termination) but only within such period of time ending on the earlier of (i) the date three (3) months following the termination of the Participant’s Continuous Service (or such longer or shorter period specified in the Option Agreement), or (ii) the expiration of the term of the Option as set forth in the Option Agreement. If, after termination, the Participant does not exercise his or her Option within the time specified in the Option Agreement, the Option shall terminate.
(g) Extension of Termination Date. Following the termination of the Participant’s Continuous Service (other than upon the Participant’s death or Disability), if the Participant would be prohibited at any time solely because the issuance of Shares would violate the registration requirements under the Securities Act or violate any prohibition on trading on the basis of possession of material nonpublic information involving the Company and its business, then the Option shall terminate on the earlier of (i) the expiration of the term of the Option set forth in subsection 6(a), or (ii) the expiration of a period of three (3) months after the termination of the Participant’s Continuous Service during which the exercise of the Option would not be in violation of such requirements.
(h) Disability of Participant. In the event a Participant’s Continuous Service terminates as a result of the Participant’s Disability, the Participant may exercise his or her Option (to the extent that the Participant was vested in the Option Shares and entitled to exercise the Option as of the date of termination), but only within such period of time ending on the earlier of (i) the date twelve (12) months following such termination (or such longer or shorter period specified in the Option Agreement) or (ii) the expiration of the term of the Option as set forth in the Option Agreement. If, after termination, the Participant does not exercise his or her Option within the time specified herein, the Option shall terminate.
(i) Death of Participant. In the event (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 Option Agreement after the termination of the Participant’s Continuous Service for a reason other than death, then the Option may be exercised (to the extent the Participant was vested in the Option Shares and entitled to exercise the Option as of the date of death) by the Participant’s estate, by a person who acquired the right to exercise the Option by bequest or inheritance or by a person designated to exercise the Option upon the Participant’s death pursuant to subsection 6(d), but only within the period ending on the earlier of (1) the date eighteen (18) months following the date of death (or such longer or shorter period specified in the Option Agreement) or (2) the expiration of the term of such Option as set forth in the Option Agreement. If, after death, the Option is not exercised within the time specified herein, the Option shall terminate.
(j) Exercise Generally. Options shall be considered exercised when the Company (or its authorized agent) receives (i) written or electronic notice from the person entitled to exercise the Option of intent to exercise a specific number of Shares, (ii) full payment or appropriate provision for payment in a form and method acceptable to the Board or Committee, for the Shares being exercised, and (iii) if applicable, payment or appropriate provision for payment of any withholding taxes due on exercise. An Option may not be exercised for a fraction of a Share. The Option may, at the discretion of the Board or Committee, include a provision whereby the Participant may elect to exercise the Option as to Shares that are not yet 

vested. Unvested Shares exercised in such manner may be subject to a Company repurchase right under Section 14(h) or such other restrictions or conditions as the Board or Committee may determine.
(k) Administrator Discretion. Notwithstanding the provisions of this Section 6, the Board or the Committee shall have complete discretion exercisable at any time to (i) extend the period of time for which an Option is to remain exercisable, following the Participant’s termination of Continuous Service, but in no event beyond the expiration date for the Option, and (ii) permit the Option to be exercised, during the applicable post-termination exercise period, not only with respect to the number of Shares that were vested on the date of termination, but also with respect to additional Shares on such terms and conditions as the Board or Committee may determine.

7. PROVISIONS OF STOCK AWARDS AND STOCK UNITS.
Each Award Agreement reflecting the issuance of a Stock Award or Stock Unit shall be in such form and shall contain such terms and conditions as the Board shall deem appropriate. The terms and conditions of such agreements may change from time to time, and the terms and conditions of separate agreements need not be identical, but each such agreement shall include (through incorporation of provisions hereof by reference in the agreement or otherwise) the substance of each of the following provisions:
(a) Consideration. A Stock Award or Stock Unit may be awarded in consideration for such property or services as is permitted under Applicable Law, including for past services actually rendered to the Company or an Affiliate for its benefit.
(b) Vesting; Restrictions. Shares of Common Stock awarded under the Award Agreement reflecting a Stock Award or Stock Unit award may, but need not, be subject to a Share repurchase option, forfeiture restriction or other conditions in favor of the Company in accordance with a vesting or lapse schedule to be determined by the Board.
(c) Termination of Participant’s Continuous Service. In the event a Participant’s Continuous Service terminates, the Company may reacquire any or all of the Shares of Common Stock held by the Participant which have not vested or which are otherwise subject to forfeiture or other conditions as of the date of termination under the terms of the agreement.
(d) Transferability. Rights to acquire Shares of Common Stock under a Stock Award or Stock Unit agreement shall not be transferable except by will or by the laws of descent and distribution, and Shares of Common Stock issued upon vesting of a Stock Award or Stock Unit shall be issuable during the lifetime of the Participant only to the Participant.

8. STOCK APPRECIATION RIGHTS.
Each Award Agreement reflecting the issuance of a Stock Appreciation Right shall be in such form and shall contain such terms and conditions as the Board shall deem appropriate. The terms and conditions of such agreements may change from time to time, and the terms and conditions of separate agreements need not be identical, but each such agreement shall include (through incorporation of provisions hereof by reference in the agreement or otherwise) the substance of each of the following provisions:
(a) Grant Price. A Stock Appreciation Right may be granted in tandem with an Option or alone (“freestanding”). The grant price of a tandem Stock Appreciation Right shall be equal to the exercise price of the related Option. The grant price of a freestanding Stock Appreciation Right shall be established in accordance with procedures for Options set forth in Section 6.
(b) Term. A Stock Appreciation Right may be exercised upon such terms and conditions and for the term as the Committee determines in its sole discretion; provided, however, that, subject to earlier termination in accordance with the terms of the Plan and the Award Agreement evidencing the Stock Appreciation Right, the maximum term of a freestanding Stock Appreciation Right shall be ten years, and in the case of a tandem Stock Appreciation Right, (a) the term shall not exceed the term of the related Option and (b) the tandem Stock Appreciation Right may be exercised for all or part of the Shares subject to the related Option upon the surrender of the right to exercise the equivalent portion of the related Option, except that the tandem Stock Appreciation Right may be exercised only with respect to the shares for which its related Option is then exercisable.

(c) Payment. Upon the exercise of a Stock Appreciation Right, a Participant shall be entitled to receive payment in an amount determined by multiplying: (a) the difference between the Fair Market Value of the Common Stock on the date of exercise over the grant price of the Stock Appreciation Right by (b) the number of shares with respect to which the Stock Appreciation Right is exercised. At the discretion of the Committee as set forth in the instrument evidencing the Award, the payment upon exercise of a Stock Appreciation Right may be in cash, in shares, in some combination thereof or in any other manner approved by the Committee in its sole discretion.

9. PERFORMANCE AWARDS.
(a) Performance Shares. The Committee may grant Awards of Performance Shares, designate the Participants to whom Performance Shares are to be awarded and determine the number of Performance Shares and the terms and conditions of each such Award. Performance Shares shall consist of a unit valued by reference to a designated number of Shares, the value of which may be paid to the Participant by delivery of Shares or, if set forth in the instrument evidencing the Award, of such property as the Committee shall determine, including, without limitation, cash, Shares, other property, or any combination thereof, upon the attainment of performance goals, as established by the Committee, and other terms and conditions specified by the Committee. Subject to Section 11, the amount to be paid under an Award of Performance Shares may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion.
(b) Performance Units. The Committee may grant Awards of Performance Units, designate the Participants to whom Performance Units are to be awarded and determine the number of Performance Units and the terms and conditions of each such Award. Performance Units shall consist of a unit valued by reference to a designated amount of property other than shares of Common Stock, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including, without limitation, cash, Shares, other property, or any combination thereof, upon the attainment of performance goals, as established by the Committee, and other terms and conditions specified by the Committee. Subject to Section 11, the amount to be paid under an Award of Performance Units may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion.

10. OTHER STOCK OR CASH-BASED AWARDS.
Subject to the terms of the Plan and such other terms and conditions as the Committee deems appropriate, the Committee may grant other incentives payable in cash or in Shares under the Plan.

11. CODE SECTION 162(m) PROVISIONS.
Notwithstanding any other provision of the Plan to the contrary, if the Committee determines, at the time Awards are granted to a Participant who is, or may be as of the end of the tax year in which the Company would claim a tax deduction in connection with such Award, a Covered Employee, then the Committee may, including, without limitation, for purposes of any jurisdiction that either directly or indirectly incorporates Prior Section 162(m) of the Code, provide that this Section 11 is applicable to such Award.
(a) Performance Criteria. If an Award is subject to this Section 11, then the lapsing of restrictions thereon and the distribution of cash, Shares or other property pursuant thereto, as applicable, shall be subject to the achievement of one or more objective performance goals established by the Committee, which shall be based on the attainment of specified levels of one of or any combination of the following “performance criteria” either individually, alternatively or in combination, applied to either the Company as a whole or to a business unit or Affiliate, either individually, alternatively or in any combination, and measured either annually, cumulatively over a period of years, or other period as determined by the Committee, on an absolute basis or relative to a pre-established target, to previous years’ results or to a designated comparison group, in each case as specified by the Committee, with such adjustments determined appropriate by the Committee to the extent consistent with Prior Section 162(m) of the Code including, without limitation, to reflect extraordinary, unusual or infrequently occurring events, transactions or other items; acquired, discontinued or disposed operations; effects of changes in accounting principles, tax or other laws or requirements; regulatory capital requirements; or similar events or circumstances; revenue; earnings before all or any of interest expense, taxes, depreciation and amortization; cash flows (including, but not limited to, operating cash flow, free cash flow or cash flow return on capital); working 

capital; earnings per share; net worth; operating income (including or excluding depreciation, amortization, extraordinary items, restructuring charges or other expenses); sales (net, gross or growth measured by product line, territory, customers or other category); market share; operating margins; profits; profit margins; peer group performance; return on equity; stock price appreciation; total shareholder return; industry indices; costs; cost control; capital expenditures; strategic initiatives; market share; net income; achievement of balance sheet or income statement objectives; or customer satisfaction, employee satisfaction, services performance, cash management or asset management metrics; or profitability of an identifiable business unit or product (together, the “Performance Criteria”).
The Committee, to the extent consistent with “performance-based compensation” within the meaning of Prior Section 162(m)(4)(C) of the Code, may provide that any evaluation of performance may include or exclude any of the following events that occurs during a performance period: (i) asset write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results, (iv) any reorganization and restructuring programs, (v) extraordinary nonrecurring items, (vi) acquisitions or divestitures, (vii) foreign exchange gains and losses, and (viii) gains and losses on asset sales. To the extent such inclusions or exclusions affect Awards to Covered Employees and to the extent deemed appropriate by the Committee, they shall be prescribed in a form intended to satisfy the requirements for “performance-based compensation” within the meaning of Prior Section 162(m)(4)(C) of the Code.
(b) Adjustment of Awards. Notwithstanding any provision of the Plan other than Section 15, with respect to any Award that is subject to this Section 11, the Committee may adjust downwards, but not upwards, the amount payable pursuant to such Award, and the Committee may not waive the achievement of the applicable performance goals except in the case of the death or disability of the Covered Employee.
(c) Limitations. Subject to adjustment from time to time as provided in Section 15, no Covered Employee may be granted Awards other than Performance Units subject to this Section 11 in any fiscal year period with respect to more than 2,000,000 Shares for such Awards, and the maximum dollar value payable with respect to Performance Units or other awards payable in cash subject to this Section 11 granted to any Covered Employee in any one fiscal year is $5,000,000.
The Committee shall have the power to impose such other restrictions on Awards subject to this Section 11 as it may deem necessary or appropriate including to ensure that such Awards satisfy all requirements for “performance-based compensation” within the meaning of Prior Section 162(m)(4)(C) of the Code, or any successor provision thereto.
Notwithstanding any other provision in the Plan, the Plan is not intended to modify in any material respect any Award pursuant to a written binding contract in effect on November 2, 2017 that is intended to be “performance-based compensation” under Prior Section 162(m) of the Code.

12. COVENANTS OF THE COMPANY.
(a) Availability of Shares. During the terms of the Awards, the Company shall keep available at all times the number of Shares of Common Stock required to satisfy such Awards.
(b) Securities Law Compliance. If the Company does not obtain from any regulatory commission or agency the authority which counsel for the Company deems necessary for the lawful issuance and sale of stock under the Plan, the Company shall be relieved from any liability for failure to issue and sell stock upon exercise of such Awards unless and until such authority is obtained.

13. USE OF PROCEEDS FROM STOCK; UNFUNDED PLAN.
Proceeds from the sale of stock pursuant to Awards shall constitute general funds of the Company. The Plan shall be unfunded. Although bookkeeping accounts may be established with respect to Participants who are granted Awards hereunder, any such accounts will be used merely as a bookkeeping convenience. The Company shall not be required to segregate any asset which may at any time be represented by Awards, nor shall this Plan be construed as providing for such segregation, nor shall the Company nor any party authorized to administer the Plan be deemed to be a trustee of stock or cash to be awarded under the Plan. Any liability of the Company to any Participant with respect to an Award shall be based solely upon any contractual obligations which may be created by the Plan; no such obligation of the Company shall be deemed to be secured by any pledge or other encumbrance on any property of the 

Company. Neither the Company nor any party authorized to administer the Plan shall be required to give any security or bond for the performance of any obligation which may be created by this Plan.

14. GENERAL.
(a) Acceleration of Exercisability and Vesting. The Board shall have the power to accelerate the time at which an Award may first be exercised or the time during which an Award or any part thereof will vest, become exercisable or be settled in accordance with the Plan, notwithstanding the provisions in the Award stating the time at which it may first vest, be exercised or be settled.
(b) Leave of Absence. The Board (or any other party to whom such authority has been delegated) shall have the discretion to determine whether and to what extent the vesting of Awards shall be tolled during any unpaid leave of absence consistent with law.
(c) Dividends and Dividend Equivalents. No dividends or dividend equivalents shall be paid to Participants with respect to unvested Awards until such Awards vest but this sentence shall not prohibit the payment of dividends or dividend equivalents attributable to the period while Awards were unvested to be paid upon or after the vesting of the Award. Subject to the foregoing, Participants may, if the Committee so determines, be credited with dividends paid with respect to Shares underlying an Award in a manner determined by the Committee in its sole discretion. The Committee may apply any restrictions to the dividends or dividend equivalents that the Committee deems appropriate. The Committee, in its sole discretion, may determine the form of payment of dividends or dividend equivalents, including cash, Shares, Stock Awards or Stock Units. Furthermore, the right to any dividends or dividend equivalents declared and paid on the number of shares underlying an Option or a Stock Appreciation Right may not be contingent, directly or indirectly on the exercise of the Option or Stock Appreciation Right, and must comply with or qualify for an exemption under Section 409A. The number of shares of Common Stock available for issuance under the Plan shall not be reduced to reflect any dividends or dividend equivalents that are reinvested into additional shares of Common Stock or credited as additional shares of Common Stock subject or paid with respect to an Award.
(d) Shareholder Rights. No Participant shall be deemed to be the holder of, or to have any of the rights of a holder with respect to, any Shares subject to such Award unless and until such Participant has satisfied all requirements for exercise of the Award pursuant to its terms.
(e) No Employment or other Service Rights. Nothing in the Plan or any instrument executed or any Award granted pursuant thereto shall confer upon any Participant or other holder of Awards any right to continue to serve the Company or an Affiliate in the capacity in effect at the time the Award was granted or shall 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 Bylaws of the Company or an Affiliate, and any applicable provisions of the corporate law of the state in which the Company or the Affiliate is incorporated, as the case may be.
(f) Investment Assurances. The Company may require a Participant, as a condition of exercising or acquiring 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 he or she 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 the stock subject to the Award for the Participant’s own account and not with any present intention of selling or otherwise distributing the stock. The foregoing requirements, and any assurances given pursuant to such requirements, shall be inoperative if the issuance of the Shares upon the exercise or acquisition of stock under the Award has been registered under a then currently effective registration statement under the Securities Act; or 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 stock.

(g) Withholding Obligations. To the extent provided by the terms of an Award Agreement, the Participant may satisfy any federal, state or local tax withholding obligation relating to the exercise or acquisition of Shares under an Award by any of the following means (in addition to the Company’s right to withhold from any compensation paid to the Participant by the Company) or by a combination of such means: (i) tendering a cash payment; (ii) authorizing the Company to withhold Shares from the Shares otherwise issuable to the Participant as a result of the exercise or acquisition of stock under the Award; (iii) authorizing the Company to withhold amounts from amounts otherwise deliverable to the Participant as a result of Awards; or (iv) delivering to the Company owned and unencumbered Shares.
(h) Stock Unit Repurchase Limitation. The terms of any repurchase option for a Stock Unit or Share shall be specified in the Award and may be at the Fair Market Value of the stock subject to the Award at the time of repurchase, at the original price or on such terms and conditions as the Board may determine (and as shall be reflected in the Award Agreement); provided however that this Section 14(h) shall in no way limit the Company’s ability to adjust any Award as provided under Section 15 below.
(i) No Repricing. In no event shall the Committee have the right, without shareholder approval, to (i) lower the price of an Option or Stock Appreciation Right after it is granted, except in connection with adjustments provided in Section 15; (ii) take any other action that is treated as a repricing under generally accepted accounting principles; or (iii) cancel an Option or Stock Appreciation Right at a time when its exercise or grant price exceeds the fair market value of the underlying Share, in exchange for cash or another Award, unless the cancellation and exchange occurs in connection with a merger, acquisition, spin-off or other similar corporate transaction; provided however that this Section 14(i) shall in no way limit the Company’s ability to adjust Awards as provided under Section 15 below.
(j) Interpretation of Plan and Awards. In the event that any provision of the Plan or any Award granted under the Plan is declared to be illegal, invalid or otherwise unenforceable by a court of competent jurisdiction, such provision shall be reformed, if possible, to the extent necessary to render it legal, valid and enforceable, or otherwise deleted, and the remainder of the terms of the Plan and/or Award shall not be affected to the extent necessary to reform or delete such illegal, invalid or unenforceable provision. All questions arising under the Plan or under any Award shall be decided by the Board or the Committee in its or their total and absolute discretion and such decisions shall be final and binding on all parties.
(k) Electronic Communication. Any document required to be delivered under the Plan, including under the Applicable Laws, may be delivered in writing or electronically. Signature may also be electronic if permitted by the Board or the Committee, and if permitted by Applicable Law.
(l) Escrow of Shares. To enforce any restriction applicable to Shares issued under the Plan, the Board or the Committee may require a Participant or other holder of such Shares to deposit the certificates representing such Shares, with approved stock powers or other transfer instruments endorsed in blank, with the Company or an agent of the Company until the restrictions have lapsed. Such certificates (or other notations representing the Shares) may bear a legend or legends referencing the applicable restrictions.
(m) Participants in Non-US Jurisdictions. Without amending the Plan, the Committee may grant Awards to Employees, Consultants or Directors who are not U.S. citizens on such terms and conditions different from those specified in the Plan as may, in the judgment of the Committee, be necessary or desirable to foster and promote achievement of the purposes of the Plan and shall have the authority to adopt such modifications, procedures, subplans and the like as may be necessary or desirable to comply with provisions of the laws or regulations of countries or jurisdictions other than the United States in which the Company or any Affiliate may operate or have employees to ensure the viability of the benefits from Awards granted to Participants employed or providing services in such countries or jurisdictions, meet the requirements that permit the Plan to operate in a qualified or tax-efficient manner, comply with applicable laws or regulations outside the United States and meet the objectives of the Plan.
(n) Recoupment of Awards. All Awards (including Awards that have vested in accordance with the Award Agreement) shall be subject to the terms and conditions, if applicable, of any recoupment policy adopted by the Company from time to time or recoupment requirement imposed under applicable laws, rules or regulations or any applicable securities exchange listing standards.

15. ADJUSTMENTS UPON CHANGES IN STOCK.
(a) Capitalization Adjustments. If any change is made in the stock subject to the Plan, or subject to any Award, without the receipt of consideration by the Company (through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or other transaction not involving the receipt of consideration by the Company), the Plan will be appropriately adjusted in the class(es) and maximum number of securities subject to the Plan pursuant to subsection 4(a) and the maximum number of securities subject to award to any person pursuant to subsection 4(b) or 11(c), and the outstanding Awards will be appropriately adjusted in the class(es) and number of securities and price per Share of stock subject to such outstanding Awards. The Board, the determination of which shall be final, binding and conclusive, shall make such adjustments. (The conversion of any convertible securities of the Company shall not be treated as a transaction “without receipt of consideration” by the Company.)
(b) Change in Control — Dissolution or Liquidation. In the event of a dissolution or liquidation of the Company, then such Awards shall be terminated if not exercised (if applicable) prior to such event.
(c) Change in Control — Asset Sale, Merger, Consolidation or Reverse Merger or Acquisition of Stock.
(i) In the event of (1) a sale of substantially all of the assets of the Company, or (2) a merger or consolidation in which the Company is not the surviving corporation, or (3) a reverse merger in which the Company is the surviving corporation but the shares of Common Stock outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise, or (4) the direct or indirect acquisition (including by way of a tender or exchange offer) by any person, or persons acting as a group, of beneficial ownership or a right to acquire beneficial ownership of shares representing a majority of the voting power of the then outstanding shares of capital stock of the Company, then any surviving corporation or acquiring corporation shall assume any Awards outstanding under the Plan or shall substitute similar awards (including with respect to an Award to acquire the same consideration paid to the shareholders in the transaction described in this subsection 15(c) for those outstanding under the Plan).
(ii) For purposes of subsection 15(c) an Award shall be deemed assumed if, following the change in control, the Award confers the right to purchase in accordance with its terms and conditions, for each share of Common Stock subject to the Award immediately prior to the change in control, the consideration (whether stock, cash or other securities or property) to which a holder of a share of Common Stock on the effective date of the change in control was entitled.
(iii) Subject to the provisions of any Award Agreement, in the event any surviving corporation or acquiring corporation refuses to assume such Awards or to substitute similar awards for those outstanding under the Plan, then with respect to Awards held by Participants whose Continuous Service has not terminated, the vesting of 50% of such Awards (and, if applicable, the time during which such Awards may be exercised or settled) shall be accelerated in full, and the Awards shall terminate if not exercised or settled (if applicable) at or prior to such event. With respect to any other Awards outstanding under the Plan, such Awards shall terminate if not exercised (if applicable) prior to such event.
(iv) The Board shall at all times have the authority, in its sole discretion, to provide for additional or different vesting, exercisability, settlement or forfeiture conditions with respect to Awards than that reflected in this Section 15(c), provided that its determinations in this regard shall be reflected in the Award Agreement (including in amendments thereto) issued to the affected Participant.

16. AMENDMENT OF THE PLAN AND AWARDS.
(a) Amendment of Plan. The Board at any time, and from time to time, may amend the Plan. However, except as provided in Section 15 relating to adjustments upon changes in stock, no amendment shall be effective unless approved by the shareholders of the Company to the extent shareholder approval is necessary to satisfy the requirements of Rule 16b-3 or any Nasdaq or securities exchange listing requirements.

(b) Shareholder Approval. The Board may, in its sole discretion, submit any other amendment to the Plan for shareholder approval.
(c) Contemplated Amendments. It is expressly contemplated that the Board may amend the Plan in any respect the Board deems necessary or advisable to provide eligible Employees with the maximum benefits provided or to be provided under the provisions of the Code or any other Applicable Law.
(d) No Impairment of Rights. Rights under any Award granted before amendment of the Plan shall not be materially impaired by any amendment of the Plan unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing.
(e) Amendment of Awards. The Board at any time, and from time to time, may amend the terms of any one or more Awards; provided, however, that the rights under any Award shall not be materially impaired by any such amendment unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing.

17. TERMINATION OR SUSPENSION OF THE PLAN.
(a) Plan Term. The Board may suspend or terminate the Plan at any time. Unless sooner terminated, the Plan shall terminate on March 13, 2029. No Awards may be granted under the Plan while the Plan is suspended or after it is terminated.
(b) No Impairment of Rights. Suspension or termination of the Plan shall not materially impair rights and obligations under any Award granted while the Plan is in effect except with the written consent of the Participant.

18. EFFECTIVE DATE OF PLAN.
The Plan was originally adopted by the Board on December 31, 2004 and originally approved by shareholders on February 24, 2005 and subsequently amended by the Board of Directors on January 8, 2007, January 23, 2007, August 5, 2007 and January 7, 2009. The Board of Directors approved amendments and restatements of the Plan on January 3, 2014, January 5, 2015, January 20, 2017, January 18, 2019, January 21, 2020 and January 22, 2021 which were subsequently approved by shareholders on March 13, 2014, March 12, 2015, March 9, 2017, March 14, 2019, March 12, 2020 and March 11, 2021, respectively. This amendment and restatement of the Plan has been approved by the Board on January 21, 2022, but it will only become effective when it is approved by the Company’s shareholders at the annual meeting of the Company’s shareholders on March 10, 2022 or any adjournment thereof (the “2022 Annual Meeting”). If this amendment and restatement is not approved by the affirmative vote of the holders of a majority of the outstanding Shares of the Company present, or represented by proxy, and entitled to vote thereon, at the 2022 Annual Meeting in accordance with the laws of the State of Washington and other applicable requirements, this amendment and restatement shall be void and the terms of the Plan prior to this amendment and restatement shall instead govern.

19. COMPLIANCE WITH LAWS AND REGULATIONS.
The Plan and Awards granted under the Plan are intended to be exempt from the requirements of Section 409A of the Code (“Section 409A”) to the maximum extent possible, whether pursuant to the short-term deferral exception described in Treasury Regulation Section 1.409A-1(b)(4), the exclusion applicable to stock options, stock appreciation rights and certain other equity-based compensation under Treasury Regulation Section 1.409A-1(b)(5), or otherwise. To the extent Section 409A is applicable to the Plan or any Award granted under the Plan, it is intended that the Plan and any Awards granted under the Plan comply with the deferral, payout and other limitations and restrictions imposed under Section 409A and be interpreted, operated and administered in a manner consistent with such intentions. Without limiting the generality of the foregoing, and notwithstanding any other provision of the Plan or any Award granted under the Plan to the contrary, with respect to any payments and benefits under the Plan or any Award granted under the Plan to which Section 409A applies, all references in the Plan or any Award granted under the Plan to the termination of the Participant’s employment or service are intended to mean the Participant’s “separation from service,” within the meaning of Section 409A(a)(2)(A)(i). In addition, if the Participant is a “specified employee,” within the meaning of Section 409A, then to the extent necessary to avoid subjecting the Participant to the imposition of any additional tax under Section 409A, amounts that would otherwise be payable under the Plan or any Award granted under the Plan during the 

six-month period immediately following the Participant’s “separation from service,” within the meaning of Section 409A(a)(2)(A)(i), shall not be paid to the Participant during such period, but shall instead be accumulated and paid to the Participant (or, in the event of the Participant’s death, the Participant’s estate) in a lump sum on the first business day after the earlier of the date that is six months following the Participant’s separation from service or the Participant’s death. Notwithstanding any other provision of the Plan to the contrary, the Committee, to the extent it deems necessary or advisable in its sole discretion, reserves the right, but shall not be required, to unilaterally amend or modify the Plan and any Award granted under the Plan so that the Award qualifies for exemption from or complies with Section 409A; provided, however, that the Committee makes no representations that Awards granted under the Plan shall be exempt from or comply with Section 409A and makes no undertaking to preclude Section 409A from applying to Awards granted under the Plan.

20. GOVERNING LAW.
All questions concerning the construction, validity and interpretation of this Plan shall be governed by the law of the State of Washington, without regard to such states conflict of laws rules. Participants irrevocably consent to the jurisdiction and venue of the state and federal courts located in the State of Washington.EX-10.1

 Exhibit 10.1 

SETTLEMENT AGREEMENT 

This Settlement Agreement (“Agreement”) is entered into among the United States of America, acting through the United States
Department of Justice and on behalf of the Office of Inspector General (“OIG-HHS”) of the Department of Health and Human Services (“HHS”) (collectively, the “United States”),
Mallinckrodt plc and Mallinckrodt ARD LLC (f/k/a Questcor Pharmaceuticals, Inc.), debtors and debtors-in-possession acting on behalf of themselves and their estates
(collectively, “Mallinckrodt”)1, and James Landolt (“Relator”) (hereafter collectively referred to as “the Parties”), through their authorized representatives. 

RECITALS 
 A. In order to
obtain federal reimbursement for its covered outpatient drugs under any state Medicaid programs, see 42 U.S.C. §§ 1396-1396w-5 (“Medicaid”), all of which the federal government
jointly finances with the states, a pharmaceutical manufacturer must opt into the Medicaid Drug Rebate Program (“MDRP”). The MDRP’s implementing statute, 42 U.S.C. § 1396r-8 (the
“Rebate Statute”), requires such manufacturers to enter into a Rebate Agreement. The Rebate Statute sets the terms of the Rebate Agreement. The Rebate Statute and Rebate Agreement require the manufacturer to pay each state Medicaid program
a quarterly amount that potentially includes an inflation-based “additional rebate” for each “dosage form and strength” of a single source drug or an innovator multiple source drug. See 42 U.S.C. § 1396r-8(c)(2)(A). If the drug was approved by the Food and Drug Administration (“FDA”) on or prior to October 1, 1990, any additional rebate equals the difference, if any, between the drug’s
current quarter 
  
  

	1 	 References to Mallinckrodt shall include and encompass any reorganized Mallinckrodt created by the Approved
Plan (defined herein) confirmed by the Bankruptcy Court. For the avoidance of doubt: (a) reorganized Mallinckrodt plc and reorganized Mallinckrodt ARD LLC shall be considered successors to Mallinckrodt plc and Mallinckrodt ARD LLC,
respectively, and be fully responsible for any liabilities, obligations, or conditions included in this Settlement Agreement; (b) the Approved Plan shall provide for (i) the reorganization and continued corporate existence of Mallinckrodt
plc and Mallinckrodt ARD LLC and (ii) the vesting of the assets of Mallinckrodt plc and Mallinckrodt ARD LLC in reorganized Mallinckrodt plc and Mallinckrodt ARD LLC upon the effective date of the confirmed Approved Plan. 

 
“average manufacturer price” (“AMP”) and the drug’s AMP for the third quarter of 1990 increased by the rate of inflation. For a “subsequently approved” drug
(i.e., a “covered outpatient drug approved by the Food and Drug Administration after October 1, 1990”), any additional rebate equals the difference, if any, between the drug’s current quarter AMP and its AMP for the first
full calendar quarter after the date on which “the drug was first marketed,” increased by the rate of inflation. See 42 U.S.C. § 1396r-8(c)(2)(B). The AMP that serves as the starting
point for the “additional rebate” calculation is commonly called the “Base Date AMP.” 
 B. Mallinckrodt plc is an Irish
public limited company. Its subsidiary, Mallinckrodt ARD, LLC (f/k/a Questcor Pharmaceuticals, Inc.), is a California limited liability company with its principal place of business in New Jersey. Mallinckrodt does business as a pharmaceutical
manufacturer in the United States and markets H.P. Acthar Gel (“Acthar”) in the United States. 
 C. On September 20, 2018,
James Landolt filed a qui tam action in the United States District Court for the District of Massachusetts captioned United States ex rel. John Doe v. Mallinckrodt ARD, LLC, No. 1:18-cv-11931-PBS, pursuant to the qui tam provisions of the False Claims Act, 31 U.S.C. § 3730(b) (the “Civil Action”). The Civil Action alleges
that Mallinckrodt knowingly and improperly avoided paying rebates to the Medicaid program for Mallinckrodt’s drug Acthar. The United States intervened in the Civil Action on March 2, 2020, and filed a Complaint-in-Intervention on March 3, 2020. 
 D. The United States contends that it has
certain civil claims against Mallinckrodt arising from conduct alleged in the United States’ Complaint-in-Intervention in the Civil Action for the time period of
January 1, 2013 through and including June 30, 2020. That conduct is referred to below as the “Covered Conduct.” 

 E. Mallinckrodt admits and agrees that there is only one Acthar, that FDA approved Acthar
pursuant to a New Drug Application in 1952, and that Acthar was first produced, distributed, and marketed prior to 1990. Mallinckrodt has reinstated in CMS’s drug data reporting system (DDR) the Base Date AMP for Acthar as Acthar’s AMP
from the third quarter of 1990, and agrees that it will not change that Base Date AMP in the DDR. 
 F. Relator claims entitlement under 31
U.S.C. § 3730(d) and comparable provisions of any applicable state statutes to a share of the proceeds of this Agreement and to Relator’s reasonable expenses, attorneys’ fees and costs. 

G. Mallinckrodt will enter into separate settlement agreements (hereinafter referred to as the “Medicaid State Settlement
Agreements”) with certain states, which for the purposes of this agreement include the Commonwealth of Puerto Rico and the District of Columbia, in settlement of the conduct released in those separate Medicaid State Settlement Agreements.
States with which Mallinckrodt executes a Medicaid State Settlement Agreement in the form to which Mallinckrodt and the States have agreed through a State Negotiating Team, or in a form otherwise agreed to by Mallinckrodt and an individual State,
shall be defined as “Medicaid Participating States.” 
 H. The Parties have negotiated this Agreement in good faith and at
arm’s length and intend the Agreement to be consummated through (a) the voluntary cases under chapter 11 of the Bankruptcy Code (as defined below) (the “Chapter 11 Cases”) filed in the United States Bankruptcy Court for the
District of Delaware (the “Bankruptcy Court”) Case No. 20-12522 (JTD), by Mallinckrodt ARD LLC and certain of its affiliates and subsidiaries on October 12, 2020, (b) the examinership
proceeding to be commenced by Mallinckrodt plc under the laws of Ireland (the “Examinership Proceeding”)), and (c) the proceedings commenced under Part IV of the Canadian Companies Arrangement Act to recognize in Canada the Chapter 11
Cases and to recognize in Canada certain orders of the Bankruptcy Court (the “Canadian Recognition Proceeding” and, collectively with the Chapter 11 Cases and the Examinership Proceeding, the “Bankruptcy Proceedings”).2 
  
  

	2 	 Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in Exhibit A.

 In consideration of the mutual promises and obligations of this Agreement, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree and covenant as follows: 

TERMS AND CONDITIONS 
 1.
Mallinckrodt shall pay to the United States and the Medicaid Participating States collectively, $233,707,865.18, plus interest accruing at an annual rate of 0.6255%, running from September 21, 2020, in eight installments, pursuant to the
installment payment schedule described in Exhibit B (the “Settlement Amount”). The interest described in the foregoing sentence shall accrue on the outstanding balance of the remaining installment payments and all then-accrued interest
shall be payable in cash to the United States and the Medicaid Participating States contemporaneously with each installment payment as set forth on Exhibit B. Of the Settlement Amount, Mallinckrodt shall pay $123,642,146.73 (plus accrued interest)
to the United States (“Federal Settlement Amount”) by electronic funds transfer pursuant to written instructions to be provided by the United States Attorney’s Office for the District of Massachusetts, and $110,065,718.45 (plus
accrued interest) (“State Settlement Amount”) to the Medicaid Participating States pursuant to the terms of Medicaid State Settlement Agreements that Mallinckrodt has or will enter into with the Medicaid Participating States. The entire
Settlement Amount shall be considered restitution. The entire balance of the Settlement Amount, or any portion thereof, may be prepaid without premium or penalty. If Mallinckrodt elects to prepay the Settlement Amount, or any portion thereof,
interest shall accrue through the 

 
date on which Mallinckrodt makes said prepayment. If Mallinckrodt is sold, merged, or transferred, or all or substantially all of the assets of Mallinckrodt (on a consolidated basis) are sold,
merged, or transferred into another non-affiliated entity, Mallinckrodt shall promptly notify the United States, and all remaining payments owed pursuant to the Settlement Agreement shall be accelerated and
become immediately due and payable upon consummation of such transaction. 
 2. Conditioned upon the United States receiving the Settlement
Amount installment payments from Mallinckrodt, the United States agrees that it shall pay by electronic funds transfer to Relator twenty (20) % of each such payment received under the Agreement (“Relator’s Share”) as soon as feasible
after receipt of the payment. 
 3. Mallinckrodt has agreed to pay Relator’s reasonable expenses, attorneys’ fees and costs, as
contemplated by 31 U.S.C. § 3730(d) and comparable provisions of any applicable state statutes and will do so subject to terms set forth in a separate agreement that Mallinckrodt and Relator will enter into contemporaneously with this
agreement. 
 4. Subject to the exceptions in Paragraph 7 (concerning reserved claims) below, and subject to Paragraph 10 (concerning
disclosure of assets), and subject to Paragraphs 19 and 20, below (concerning bankruptcy), and upon the United States’ receipt of the Settlement Amount, the United States releases Mallinckrodt, together with its current or former parent
corporations; subsidiaries; brother or sister corporations; divisions; current or former corporate owners; and the corporate successors and assigns of any of them (the “Mallinckrodt Releasees”), from any civil or administrative monetary
claim the United States has for the Covered Conduct under the False Claims Act, 31 U.S.C. §§ 3729-33, the Civil Monetary Penalties Law, 42 U.S.C. §
1320a-7a, the Program Fraud Civil Remedies Act, 31 U.S.C. §§ 3801-12, any statutory provision for which the Civil Division of the Department of Justice has
actual and present authority to assert and compromise pursuant to 28 CFR Part 0; Subpart I, 0.45(d); or the common law theories of payment by mistake, unjust enrichment, and fraud. 

 5. Subject to the exceptions in Paragraph 7 (concerning reserved claims) below, and subject
to Paragraph 10 (concerning disclosure of assets), and subject to Paragraphs 19 and 20, below (concerning bankruptcy), and upon the United States’ receipt of the Settlement Amount, Relator, for himself and for his heirs, successors, attorneys,
agents, and assigns, releases the Mallinckrodt Releasees from any civil monetary claim the Relator has on behalf of the United States for the Covered Conduct under the False Claims Act, 31 U.S.C. §§
3729-33. 
 6. In consideration of the obligations of Mallinckrodt in this Agreement and the
Corporate Integrity Agreement (CIA), entered into between OIG-HHS and Mallinckrodt plc and upon the United States’ receipt of full payment of the Settlement Amount, plus interest due under Paragraph 1,
the OIG-HHS shall release and refrain from instituting, directing, or maintaining any administrative action seeking exclusion from Medicare, Medicaid, and other Federal health care programs (as defined in 42
U.S.C. § 1320a-7b(f)) against Mallinckrodt under 42 U.S.C. § 1320a-7a (Civil Monetary Penalties Law) or 42 U.S.C. §
1320a-7(b)(7) (permissive exclusion for fraud, kickbacks, and other prohibited activities) for the Covered Conduct, except as reserved in this paragraph and in Paragraph 7 (concerning reserved claims), below.
The OIG-HHS expressly reserves all rights to comply with any statutory obligations to exclude Mallinckrodt from Medicare, Medicaid, and other Federal health care programs under 42 U.S.C. § 1320a-7(a) (mandatory exclusion) based upon the Covered Conduct. Nothing in this paragraph precludes the OIG-HHS from taking action against entities or persons, or for conduct
and practices, for which claims have been reserved in Paragraph 7, below. 

 7. Notwithstanding the releases given in paragraphs 4 and 6 of this Agreement, or any other
term of this Agreement, the following claims of the United States are specifically reserved and are not released: 
  

	 	a.	 Any liability arising under Title 26, U.S. Code (Internal Revenue Code); 

 

	 	b.	 Any criminal liability; 

 

	 	c.	 Except as explicitly stated in this Agreement, any administrative liability or enforcement right, including
mandatory exclusion from Federal health care programs; 

  

	 	d.	 Any liability to the United States (or its agencies) for any conduct other than the Covered Conduct;

  

	 	e.	 Any liability based upon obligations created by this Agreement; and 

 

	 	f.	 Any liability of individuals. 

8. Relator and his heirs, successors, attorneys, agents, and assigns shall not object to this Agreement but agree and confirm that this
Agreement is fair, adequate, and reasonable under all the circumstances, pursuant to 31 U.S.C. § 3730(c)(2)(B). Conditioned upon Relator’s receipt of the Relator’s Share, Relator and his heirs, successors, attorneys, agents, and
assigns fully and finally release, waive, and forever discharge the United States, its agencies, officers, agents, employees, and servants, from any claims arising from the filing of the Civil Action or under 31 U.S.C. § 3730, and from any
claims to a share of the proceeds of this Agreement and/or the Civil Action. 
 9. Relator, for himself, and for his heirs, successors,
attorneys, agents, and assigns, fully and finally releases the Mallinckrodt Releasees, and their officers, agents, and employees, from any claims (including attorneys’ fees, costs, and expenses of every kind and however denominated, outside of
those contemplated in a separate agreement that Mallinckrodt and Relator will enter into contemporaneously with this agreement) that Relator has asserted, could have asserted, or may assert in the future against Mallinckrodt related to the Civil
Action or the Covered Conduct and Relator’s investigation or prosecution thereof, or any liability to Relator arising from the filing of the Civil Action, or under 31 U.S.C. § 3730(d) for expenses or attorneys’ fees and costs. 

 10. Mallinckrodt has provided sworn financial disclosures and supporting documents
(“Financial Disclosures”) to the United States, and the United States has relied on the accuracy and completeness of those Financial Disclosures in reaching this Agreement. Mallinckrodt warrants that the Financial Disclosures are complete,
accurate, and current as of the date provided. If the United States learns of asset(s) in which Mallinckrodt had an interest of any kind as of the Effective Date of this Agreement (including, but not limited to, promises by insurers or other third
parties to satisfy Mallinckrodt’s obligations under this Agreement) that were not disclosed in the Financial Disclosures, or if the United States learns of any false statement or misrepresentation by Mallinckrodt on, or in connection with, the
Financial Disclosures, and if such nondisclosure, false statement or misrepresentation changes the estimated net worth set forth in the Financial Disclosures by $12.5 million or more, the United States may at its option: (a) rescind this
Agreement and reinstate its suit or file suit based on the Covered Conduct in the United States District Court for the District of Massachusetts, or (b) collect the full Settlement Amount in accordance with the Agreement plus one hundred
percent (100%) of the net value of Mallinckrodt’s previously undisclosed assets. In the event that the United States recovers additional amounts under this Paragraph, those funds constitute payments under this Agreement for purposes of
Paragraph 2, which entitles Relator to 20% of those proceeds. Mallinckrodt agrees not to contest any collection action undertaken by the United States pursuant to this provision, and agrees that it will immediately pay the United States (i) a ten-percent (10%) surcharge of the amount collected in the collection action, or (ii) the United States reasonable attorneys’ fees and expenses incurred in such an action, in each case, to the extent
allowed by 28 U.S.C. § 3011. 

 In the event that the United States, pursuant to this paragraph, rescinds this Agreement,
Mallinckrodt waives and agrees not to plead, argue, or otherwise raise any defenses under the theories of statute of limitations, laches, estoppel, or similar theories, including theories related to the Bankruptcy Proceedings such as discharge, to
any civil or administrative claims that (a) are filed by the United States within 120 calendar days of written notification to Mallinckrodt that this Agreement has been rescinded, and (b) relate to the Covered Conduct, except to the extent
these defenses were available on September 20, 2018. 
 11. Mallinckrodt waives and shall not assert any defenses Mallinckrodt may have
to any criminal prosecution or administrative action relating to the Covered Conduct that may be based in whole or in part on a contention that, under the Double Jeopardy Clause in the Fifth Amendment of the Constitution, or under the Excessive
Fines Clause in the Eighth Amendment of the Constitution, this Agreement bars a remedy sought in such criminal prosecution or administrative action. 

12. Mallinckrodt fully and finally releases the United States, its agencies, officers, agents, employees, and servants, from any claims
(including for attorneys’ fees, costs, and expenses of every kind and however denominated) that Mallinckrodt has asserted, could have asserted, or may assert in the future against the United States, its agencies, officers, agents, employees,
and servants, related to the Covered Conduct or the United States’ investigation or prosecution thereof. 

 13. Mallinckrodt fully and finally releases the Relator and his heirs, successors,
attorneys, agents, and assigns from any claims (including attorneys’ fees, costs, and expenses of every kind and however denominated) that Mallinckrodt has asserted, could have asserted, or may assert in the future against Relator related to
the Civil Action or the Covered Conduct and Relator’s investigation or prosecution thereof. 
 14. The Settlement Amount shall not be
decreased as a result of the denial of claims for payment now being withheld from payment by any Medicare contractor (e.g., Medicare Administrative Contractor, fiscal intermediary, carrier or any state payer) related to the Covered Conduct;
and Mallinckrodt agrees not to resubmit to any Medicare contractor or any state payer any previously denied claims related to the Covered Conduct, agrees not to appeal any such denials of claims, and agrees to withdraw any such pending appeals. 

15. Mallinckrodt agrees to the following: 

a. Unallowable Costs Defined: All costs (as defined in the Federal Acquisition Regulation, 48 C.F.R. § 31.205-47; and in Titles XVIII and XIX of the Social Security Act, 42 U.S.C. §§ 1395-1395lll-1 and 1396-1396w-5; and the
regulations and official program directives promulgated thereunder) incurred by or on behalf of Mallinckrodt, its present or former officers, directors, employees, shareholders, and agents in connection with: 

 

	 	(1)	 the matters covered by this Agreement; 

 

	 	(2)	 the United States’ audits and investigations of the matters covered by this Agreement;

  

	 	(3)	 Mallinckrodt’s investigation, defense, and corrective actions undertaken in response to the United
States’ audits and investigations in connection with the matters covered by this Agreement (including attorneys’ fees); 

  

	 	(4)	 the negotiation and performance of this Agreement; 

	 	(5)	 the payment Mallinckrodt makes to the United States pursuant to this Agreement and any payments that
Mallinckrodt may make to Relator, including for costs and attorneys’ fees; and 

  

	 	(6)	 the negotiation of, and obligations undertaken pursuant to the CIA to: (i) retain an independent review
organization to perform annual reviews as described in Section III of the CIA; and (ii) prepare and submit reports to OIG-HHS, 

are unallowable costs for government contracting purposes and under the Medicare Program, Medicaid Program, TRICARE Program, and Federal Employees Health
Benefits Program (FEHBP) (hereinafter referred to as Unallowable Costs). However, nothing in paragraph 15.a.6 that may apply to the obligations undertaken pursuant to the CIA affects the status of costs that are not allowable based on any other
authority applicable to Mallinckrodt. 
 b. Future Treatment of Unallowable Costs: Unallowable Costs shall be separately determined
and accounted for by Mallinckrodt, and Mallinckrodt shall not charge such Unallowable Costs directly or indirectly to any contracts with the United States or any State Medicaid program, or seek payment for such Unallowable Costs through any cost
report, cost statement, information statement, or payment request submitted by Mallinckrodt or any of its subsidiaries or affiliates to the Medicare, Medicaid, TRICARE, or FEHBP Programs. 

c. Treatment of Unallowable Costs Previously Submitted for Payment: Mallinckrodt further agrees that within 120 days of the Effective
Date of this Agreement it shall identify to applicable Medicare and TRICARE fiscal intermediaries, carriers, and/or contractors, and Medicaid and FEHBP fiscal agents, any Unallowable Costs (as defined in this Paragraph) included in payments
previously sought from the United States, or any State Medicaid program, including, but not limited to, payments sought in any cost reports, cost statements, information 

 
reports, or payment requests already submitted by Mallinckrodt or any of its subsidiaries or affiliates, and shall request, and agree, that such cost reports, cost statements, information
reports, or payment requests, even if already settled, be adjusted to account for the effect of the inclusion of the Unallowable Costs. Mallinckrodt agrees that the United States, at a minimum, shall be entitled to recoup from Mallinckrodt any
overpayment plus applicable interest and penalties as a result of the inclusion of such Unallowable Costs on previously-submitted cost reports, information reports, cost statements, or requests for payment. 

Any payments due after the adjustments have been made shall be paid to the United States pursuant to the direction of the Department of
Justice and/or the affected agencies. The United States reserves its rights to disagree with any calculations submitted by Mallinckrodt or any of its subsidiaries or affiliates on the effect of inclusion of Unallowable Costs (as defined in this
Paragraph) on Mallinckrodt or any of its subsidiaries or affiliates’ cost reports, cost statements, or information reports. 
 d.
Nothing in this Agreement shall constitute a waiver of the rights of the United States to audit, examine, or re-examine Mallinckrodt’s books and records to determine that no Unallowable Costs have been
claimed in accordance with the provisions of this Paragraph. 
 16. Mallinckrodt agrees to cooperate fully and truthfully with the United
States’ investigation of individuals and entities not released in this Agreement. Upon reasonable notice, Mallinckrodt shall encourage, and agrees not to impair, the cooperation of its directors, officers, and employees, and shall use its best
efforts to make available, and encourage, the cooperation of former directors, officers, and employees for interviews and testimony, consistent with the rights and privileges of such individuals. Mallinckrodt further agrees to furnish to the United
States, upon request, complete and unredacted copies of all non-privileged documents, reports, memoranda of interviews, and records in its possession, custody, or control concerning any investigation of the
Covered Conduct that it has undertaken, or that has been performed by another on its behalf. 

 17. This Agreement is intended to be for the benefit of the Parties only. The Parties do not
release any claims against any other person or entity, except to the extent provided for in Paragraph 18 (waiver for beneficiaries paragraph), below. 

18. Mallinckrodt agrees that it waives and shall not seek payment for any of the health care billings covered by this Agreement from any
health care beneficiaries or their parents, sponsors, legally responsible individuals, or third party payors based upon the claims defined as Covered Conduct. 

19. The Settlement Amount represents the amount the United States is willing to accept in compromise of its civil claims arising from the
Covered Conduct due solely to Mallinckrodt’s financial condition as reflected in the Financial Statements referenced in Paragraph 10. 

a. In the event that Mallinckrodt fails to pay any portion of the Settlement Amount as provided in the payment schedule set forth in Paragraph
1 above, Mallinckrodt shall be in default of Mallinckrodt’s payment obligations (“Payment Default”). The United States will provide a written Notice of Payment Default, and Mallinckrodt shall have an opportunity to cure such Payment
Default within seven (7) business days from the date of receipt of the Notice of Payment Default by making the payment due under the payment schedule and paying any additional interest accruing under the Agreement up to the date of payment.
Notice of Payment Default will be delivered to Mallinckrodt, or to such other representative as Mallinckrodt shall designate in advance in writing. If Mallinckrodt fails to cure the Payment Default within seven (7) business days of receiving the
Notice of Payment Default and in the absence of an agreement 

 
with the United States to a modified payment schedule (“Uncured Payment Default”), the remaining unpaid balance of the Settlement Amount shall become immediately due and payable, and
interest on the remaining unpaid balance shall thereafter accrue at the rate of 12% per annum, compounded daily from the date of Payment Default, on the remaining unpaid total (principal and interest balance). 

b. In the event of an Uncured Payment Default, Mallinckrodt agrees that the United States, at its sole discretion, may (i) retain any
payments previously made, rescind this Agreement and pursue the Civil Action, reinstate the Complaint-in-Intervention or bring any civil and/or administrative claim,
action, or proceeding against Mallinckrodt in the United States District Court for the District of Massachusetts for the claims that would otherwise be covered by the releases provided in Paragraphs 4 and 6 above, with any recovery reduced by the
amount of any payments previously made by Mallinckrodt to the United States under this Agreement; (ii) take any action to enforce this Agreement in a new action or by reinstating the Civil Action; (iii) offset the remaining unpaid balance
from any amounts due and owing to Mallinckrodt and/or affiliated companies by any department, agency, or agent of the United States at the time of Payment Default or subsequently; and/or (iv) exercise any other right granted by law, or under
the terms of this Agreement, or recognizable at common law or in equity. The United States shall be entitled to any other rights granted by law or in equity by reason of Payment Default, including referral of this matter for private collection. In
the event the United States pursues a collection action, Mallinckrodt agrees immediately to pay the United States (i) a ten-percent (10%) surcharge of the amount collected in the collection action, or
(ii) the United States reasonable attorneys’ fees and expenses incurred in such an action, in each case, to the extent allowed by 28 U.S.C. § 3011. In the event that the United States opts to rescind this Agreement pursuant to this
Paragraph, Mallinckrodt waives and agrees not to plead, argue, or otherwise 

 
raise any defenses of statute of limitations, laches, estoppel or similar theories, including theories related to the Bankruptcy Proceedings such as discharge, to any civil or administrative
claims that are (i) filed by the United States against Mallinckrodt within 120 days of written notification that this Agreement has been rescinded, and (ii) relate to the Covered Conduct, except to the extent these defenses were available
on September 20, 2018. Mallinckrodt agrees not to contest any offset, recoupment, and /or collection action undertaken by the United States pursuant to this Paragraph, either administratively or in any state or federal court, except on the
grounds of actual payment to the United States. 
 c. In the event of an Uncured Payment Default and rescission of this Agreement by the
United States, Relator shall be entitled to recover his award and to expenses, attorneys’ fees and costs under 31 U.S.C. § 3730(d) on any False Claims Act claims brought by or on behalf of the United States based on the Covered Conduct.
Relator’s entitlement to his share of proceeds under 31 U.S.C. § 3730(d) would be reduced by the amount of any payments previously paid to Relator under Paragraph 2 of this Agreement. Relator’s entitlement to expenses, attorneys’
fees and costs under 31 U.S.C. § 3730(d) would be reduced by the amount any payments that Mallinckrodt previously paid to Relator as acknowledged in the separate agreement that Mallinckrodt and Relator entered into on will enter into
contemporaneously with this agreement, referenced in paragraph 3 of this Agreement. 
 d. In the event of an Uncured Payment Default, OIG-HHS may exclude Mallinckrodt from participating in all Federal health care programs until Mallinckrodt pays the Settlement Amount, with interest, and reasonable costs as set forth above (“Exclusion for
Default”). OIG-HHS will provide written notice of any such exclusion to Mallinckrodt. Mallinckrodt waives any further notice of the exclusion under 42 U.S.C. §
1320a-7(b)(7), and agrees not to contest such exclusion either administratively or in any state or federal court. 

 
Reinstatement to program participation is not automatic. If at the end of the period of exclusion, Mallinckrodt wishes to apply for reinstatement, it must submit a written request for
reinstatement to OIG-HHS in accordance with the provisions of 42 C.F.R. §§ 1001.3001-.3005. Mallinckrodt will not be reinstated unless and until OIG-HHS
approves such request for reinstatement. The option for Exclusion for Payment Default is in addition to, and not in lieu of, the options identified in this Agreement or otherwise available. 

20. In exchange for valuable consideration provided in this Agreement, Mallinckrodt agrees to the following: 

a. The Definitive Documents related to the Bankruptcy Proceedings shall be consistent in all material respects with this Agreement and shall
not in any manner, by their terms, contain any provisions that amend, modify, supplement, supersede or conflict with, any of the provisions of this Agreement in any manner that is materially adverse to, or materially prejudicial to the United States
or the Relator, in each case, with respect to their rights under this Settlement Agreement. The Definitive Documents shall be in form and substance reasonably acceptable to the United States. In addition, Mallinckrodt shall take such actions as may
be reasonably necessary or appropriate in the Bankruptcy Proceedings (including, without limitation, assuming its obligations under this Agreement pursuant to the Approved Plan, the Canadian Recognition Proceeding, and the Scheme of Arrangement) to
ensure Mallinckrodt will be able to comply with its obligations under this Agreement. 
 b. Where the provisions of this Agreement refer or
apply to the Chapter 11 Cases, the Bankruptcy Court, and/or the Plan (including the Definitive Documents and any other documentation relating or relevant thereto) or events, circumstances, or procedures in the United States (the “US
Process”) but do not equally reference or apply to the Examinership Proceeding, the Irish court, the Canadian Recognition Proceeding, the Canadian court, and/or the Scheme of 

 
Arrangement (including the Definitive Documents or any other documentation relating or relevant thereto) or equivalent events, circumstances, or procedures in Ireland or Canada (the “Foreign
Processes”), those provisions relating to the US Process shall be deemed to apply or refer equally to the Foreign Processes (and, if necessary, this Agreement will be deemed to include provisions relating to the Foreign Processes which
correspond to provisions relating to the US Process) to ensure that the rights and obligations of the United States and the Relator under this Agreement apply equally to the Foreign Processes in the same way as the US Process, to the fullest extent
necessary in order to implement the terms, spirit, and intent of this Agreement. Mallinckrodt shall (i) provide the United States with a copy of the Approved Plan or any other plan or reorganization or liquidation for which it intends seek
approval from the Bankruptcy Court no later than ten days prior to filing such plan with the Bankruptcy Court, and (ii) obtain approval of the Approved Plan from the United States. The United States shall not withhold approval without a reasonable,
good faith basis and will inform Mallinckrodt of the reasons for withholding approval, if any. Mallinckrodt shall have seven (7) days to revise the plan and seek approval of the revised plan from the United States. 

c. If the Chapter 11 Cases or the Irish Examinership of Mallinckrodt of Mallinckrodt are converted or dismissed, the United States and the
Medicaid Participating States shall have the right to rescind this agreement with the same protections, contemplated in paragraph 19.b., as though Mallinckrodt has committed a Payment Default. 

d. The United States may, in its sole discretion, declare that the occurrence of any of the following events is a default of
Mallinckrodt’s obligations under this Agreement (each “an Event of Default”): 

	 	i.	 the Plan Effective Date does not occur on or before June 30, 2022, or such later date to which the United
States may consent (such consent not to be unreasonably withheld); 

  

	 	ii.	 the Bankruptcy Court (or other court of competent jurisdiction) enters an order, (A) directing the
appointment of an examiner with expanded powers or a trustee in any of the Chapter 11 Cases, or (B) converting any of the Chapter 11 Cases to cases under chapter 7 of the Bankruptcy Code; 

 

	 	iii.	 the Bankruptcy Court (or other court of competent jurisdiction, including the Irish Court) enters an order, the
effect of which would render the Approved Plan incapable of consummation on the terms set forth in this Agreement. 

  

	 	iv.	 the Bankruptcy Court (or other court of competent jurisdiction, including the Irish court) grants relief that
is inconsistent with this Agreement; 

  

	 	v.	 issuance by the Bankruptcy Court or any other court of competent jurisdiction, including the Irish court, of
any ruling, judgment or order enjoining the consummation of this Agreement or the Approved Plan, or denying approval of this Agreement; 

  

	 	vi.	 (a) the filing of a pleading by Mallinckrodt seeking to withdraw, amend or modify the Approved Plan, any
of the Definitive Documents, or any motion to assume or approve this Agreement, which withdrawal, amendment, modification or filing is not consistent with this Agreement in any material respect, or (b) if 

	 	
Mallinckrodt, files any motion or pleading that is not consistent with this Agreement in any material respect and such motion or pleading has not been withdrawn prior to the earlier of
(i) three (3) business days after Mallinckrodt receives written notice from the United States that such motion or pleading is inconsistent with this Agreement, and (ii) the entry of an order of a court approving such motion;

  

	 	vii.	 the Bankruptcy Court enters an order denying confirmation of the Approved Plan; and 

 

	 	viii.	 any court of competent jurisdiction has entered a judgment or order declaring this Agreement to be
unenforceable. 

 An Event of Default may be waived by the written consent of the United States. 

e. (1) If an Event of Default occurs and has not been waived by written consent of the United States; or (2) if, before the
Settlement Amount is paid in full, Mallinckrodt or a third party commences a case, proceeding, or other action under any law relating to bankruptcy, insolvency, reorganization, or relief of debtors seeking any order for relief of Mallinckrodt’s
debts, or to adjudicate Mallinckrodt as bankrupt or insolvent; or seeking appointment of a receiver, trustee, custodian, or other similar official for Mallinckrodt or for all or any substantial part of Mallinckrodt’s assets (in each case, other
than the Bankruptcy Proceedings contemplated by this Agreement) (collectively a “Future Insolvency Proceeding”) or if Mallinckrodt’s obligations under this Agreement are avoided for any reason (including but not limited to, through
the exercise of a trustee’s avoidance powers under the Bankruptcy Code) in a Future Insolvency Proceeding or in any other case, proceeding or action: 

	 	i.	 the United States, at its sole option, may rescind the releases in this Agreement and bring any civil and/or
administrative claim, action, or proceeding against Mallinckrodt for the claims that would otherwise be covered by the releases provided in Paragraphs 4 and 6 above, including but not limited to, by re-filing
the Complaint-in- Intervention in the United States District Court for the District of Massachusetts; provided, that any such claims shall be reduced by the
amount of any payments received pursuant to this Agreement; 

  

	 	ii.	 In the event that the United States rescinds the releases in this Agreement and brings a claim, action, or
proceeding against Mallinckrodt for claims that would otherwise be covered by the releases provided in Paragraphs 4 and 6 above, Relator, at his sole option, may rescind his releases in Paragraphs 5 and 9 and shall be entitled to a share of the
proceeds of any False Claims Act claim, action, or proceeding brought by the United States, less any payments received pursuant to this Agreement; 

  

	 	iii.	 in any Future Insolvency Proceeding in which this Agreement is not assumed and the Settlement Amount is not
otherwise paid in full, the United States shall be entitled to, at its option an undisputed, noncontingent, and liquidated claim that is not subject to reconsideration or subordination against Mallinckrodt for either: (A) the then-unpaid balance of
the Settlement Amount, or (B) single damages of $640 million, plus any applicable False Claims Act multiplier and penalties; 

	 	iv.	 if any payments are avoided and recovered by Mallinckrodt, a receiver, trustee, custodian, or similar official
for Mallinckrodt, Relator shall, within thirty days of written notice from the United States to the undersigned Relator’s counsel, return any portions of such payments already paid by the United States to Relator pursuant to Paragraph 2;

  

	 	v.	 Mallinckrodt shall not argue or otherwise contend in a Future Insolvency Proceeding that the United
States’ claim, action, or proceeding in respect of the matters covered by this Settlement Agreement is subject to an automatic stay and, to the extent necessary, consents to relief from the automatic stay for cause under 11 U.S.C. §
362(d)(1). Mallinckrodt waives and shall not plead, argue, or otherwise raise any defenses under the theories of statute of limitations, laches, estoppel, or similar theories, including theories related to the Bankruptcy Proceedings such as
discharge, to any such civil or administrative claim, action, or proceeding brought by the United States within 120 days of written notification to Mallinckrodt that the releases have been rescinded pursuant to this Paragraph, except to the extent
such defenses were available on September 20, 2018; and 

	 	vi.	 OIG-HHS may exclude Mallinckrodt from participating in all Federal
health care programs until Mallinckrodt cures the default and/or pays the unpaid portion of the Settlement Amount, interest due, and collection costs. OIG-HHS will provide written notice of any such exclusion
to Mallinckrodt. Mallinckrodt waives any further notice of the exclusion under 42 U.S.C. § 1320a-7(b)(7), and agrees not to contest such exclusion either administratively or in any state or federal court.
Reinstatement to program participation is not automatic. If at the end of the period of exclusion Mallinckrodt wishes to apply for reinstatement, Mallinckrodt must submit a written request for reinstatement to
OIG-HHS in accordance with the provisions of 42 C.F.R. §§ 1001.3001-.3005. Mallinckrodt will not be reinstated unless and until the OIG approves such request for reinstatement. The option for
exclusion for default as described in this Paragraph is in addition to, and not in lieu of, the options identified in this Agreement or otherwise available. 

f. Mallinckrodt’s obligations under this Agreement may not be avoided pursuant to 11 U.S.C. § 547 or 11 U.S.C. § 548(a)(1), and
Mallinckrodt shall not argue or otherwise take the position in any Future Insolvency Proceeding or in any other case, proceeding, or action that: (i) Mallinckrodt’s obligations under this Agreement may be avoided under 11 U.S.C. §
547; (ii) the mutual promises, covenants, and obligations set forth in this Agreement do not constitute a contemporaneous exchange for new value given to Mallinckrodt; or (iii) the mutual promises, covenants, and obligations set forth herein
are not intended to and do not, in fact, represent a reasonably equivalent exchange of value or that such mutual promises, covenants and obligations are intended to hinder, delay, or defraud any entity to which Mallinckrodt was or became indebted to
on or after the date of this Agreement, within the meaning of 11 U.S.C. § 548(a)(1). 

 21. In evaluating whether to execute this Agreement, the Parties warrant that the mutual
promises, covenants, and obligations set forth herein constitute a contemporaneous exchange for new value given to Mallinckrodt, within the meaning of 11 U.S.C. § 547(c)(1), and the Parties conclude that these mutual promises, covenants, and
obligations do, in fact, constitute such a contemporaneous exchange. Further, the Parties warrant that the mutual promises, covenants, and obligations set forth herein are intended to and do, in fact, represent a reasonably equivalent exchange of
value that is not intended to hinder, delay, or defraud any entity to which Mallinckrodt was or became indebted to on or after the date of this transfer, within the meaning of 11 U.S.C. § 548(a)(1). 

22. Upon receipt of the First Installment Payment described in Paragraph 1, above, and Exhibit B, attached, the Parties shall promptly sign
and file in the Civil Action a Joint Stipulation of Dismissal pursuant to the terms of this Settlement Agreement of all claims against Mallinckrodt pursuant to Rule 41(a)(1). The Joint Stipulation of Dismissal shall be with prejudice as to the
United States’ and the Relator’s claims in the Civil Action against Mallinckrodt as to the Covered Conduct and pursuant to the terms and conditions of this Agreement. 

23. Within ten days after the Effective Date of this Agreement, Mallinckrodt will file a motion to hold in abeyance the appeal captioned
Mallinckrodt ARD LLC v. Verma, No. 20- 5154, in the United States Court of Appeals for the District of Columbia Circuit (the “DC Appeal”). Upon filing of the Joint Stipulation of
Dismissal referenced in paragraph 22, Mallinckrodt will file a motion to dismiss the DC Appeal, pursuant to Federal Rule of Appellate Procedure 42(b), with each party to bear its own costs. 

 24. Except as otherwise provided herein, each Party shall bear its own legal and other costs
incurred in connection with this matter, including the preparation and performance of this Agreement. 
 25. Each Party and signatory to
this Agreement represents that it freely and voluntarily enters into this Agreement without any degree of duress or compulsion. 
 26. This
Agreement is governed by the laws of the United States. The exclusive venue for any dispute relating to this Agreement is the United States District Court for the District of Massachusetts. For purposes of construing this Agreement, this Agreement
shall be deemed to have been drafted by all Parties to this Agreement and shall not, therefore, be construed against any Party for that reason in any subsequent dispute. 

27. This Agreement constitutes the complete agreement between the Parties. This Agreement may not be amended except by written consent of the
Parties. Forbearance by the United States or Relator from pursuing any remedy or relief available to it under this Agreement shall not constitute a waiver of rights under this Agreement. 

28. Nothing herein is intended to, or does, in any manner waive, limit, impair or restrict the ability of the United States to protect and
preserve its rights, remedies and interests, including any other claims against Mallinckrodt or other parties, or its full participation in the Bankruptcy Proceedings. Furthermore, nothing in this Agreement shall be construed to prohibit the United
States (or Relator with respect to his claim for expenses, attorneys’ fees and costs) from appearing as a party-in-interest in any matter to be adjudicated in the
Bankruptcy Proceedings so long as any appearance by the United States or Relator and the positions advocated by the United States or Relator in connection therewith are consistent with this Agreement. 

 29. In the event of any conflict among the terms and provisions in Definitive Documents, on
the one hand, and this Agreement, on the other hand, the terms and provisions of this Agreement shall control. 
 30. The undersigned
counsel represent and warrant that they are fully authorized to execute this Agreement on behalf of the persons and entities indicated below. 

31. This Agreement may be executed in counterparts, each of which constitutes an original and all of which constitute one and the same
Agreement. 
 32. This Agreement is binding on Mallinckrodt’s successors, transferees, heirs, and assigns. 

33. This Agreement is binding on Relator’s successors, transferees, heirs, and assigns. 

34. All Parties consent to the United States’ disclosure of this Agreement, and information about this Agreement, to the public. 

35. This Agreement is effective on the date of signature of the last signatory to the Agreement (Effective Date of this Agreement). Facsimiles
and electronic transmissions of signatures shall constitute acceptable, binding signatures for purposes of this Agreement. 

 THE UNITED STATES OF AMERICA 

							
		 		 	
	DATED: 03/07/2022	 		 	BY:	 	/s/ Augustine Ripa
		 		 		 	AUGUSTINE RIPA
		 		 		 	MICHAEL HOFFMAN
		 		 		 	Trial Attorneys
		 		 		 	Commercial Litigation Branch
		 		 		 	Civil Division
		 		 		 	United States Department of Justice

  

							
		 		 	
	DATED: 03/04/2022	 		 	BY:	 	/s/ Evan Panich
		 		 		 	EVAN PANICH
		 		 		 	Assistant United States Attorney
		 		 		 	District of Massachusetts

  

							
		 		 	
	DATED: 02/07/2022	 		 	BY:	 	/s/ Lisa M. Re
		 		 		 	LISA M. RE
		 		 		 	Assistant Inspector General for Legal Affairs
		 		 		 	Office of Counsel to the Inspector General
		 		 		 	Office of Inspector General
		 		 		 	United States Department of Health and Human Services

 MALLINCKRODT ARD, LLC - DEFENDANT 

 

							
	DATED: 03/03/2022	 		 	BY:	 	 /s/ Mark Casey

		 		 		 	Mark Casey
		 		 		 	Vice President & General Counsel

  

							
	DATED: 03/03/2022	 		 	BY:	 	 /s/ Michele Sartori

		 		 		 	WILLIAM KETTLEWELL
		 		 		 	MICHELE SARTORI
		 		 		 	Hogan Lovells LLP
		 		 		 	Counsel for Mallinckrodt ARD, LLC

 MALLINCKRODT PLC 

 

							
	DATED: 03/03/2022	 		 	BY:	 	 /s/ Mark Casey

		 		 		 	Mark Casey
		 		 		 	EVP, Chief Legal Officer
				
	DATED: 03/03/2022	 		 	BY:	 	 /s/ Michele Sartori

		 		 		 	WILLIAM KETTLEWELL
		 		 		 	MICHELE SARTORI
		 		 		 	Hogan Lovells LLP
		 		 		 	Counsel for Mallinckrodt plc

 JAMES LANDOLT – RELATOR 

 

							
	DATED: 2/4/22	 		 	BY:	 	 /s/ James Landolt

		 		 		 	JAMES LANDOLT
				
	DATED: 2/4/2022	 		 	BY:	 	 /s/ Linda C. Severin

		 		 		 	LINDA C. SEVERIN
		 		 		 	SUZANNE E. DURRELL
		 		 		 	Whistleblower Law Collaborative, LLC
		 		 		 	Counsel for James Landolt

 EXHIBIT A: CERTAIN DEFINITIONS 

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

	 	a.	 “Approved Plan” means a plan of reorganization for Mallinckrodt that is
consistent in all material respects with this Agreement. 

  

	 	b.	 “Approved Plan Effective Date” means the date on which the Approved Plan
becomes effective in accordance with its terms. 

  

	 	c.	 “Definitive Documents” means all material agreements, schedules and Bankruptcy Court or
other judicial or regulatory orders that are necessary to implement this Settlement Agreement, including the Confirmation Order and the Approved Plan. 

  

	 	d.	 “Scheme of Arrangement” means the scheme of arrangement based on the Plan to
be submitted for approval in the Examinership Proceeding. 

 Exhibit B – Installment Payment Schedule 

Mallinckrodt will pay the Settlement Amount to the United States and the Medicaid Participating States in eight installments as follows: 

 

	 	a.	 $13,483,146.07, plus interest on the full unpaid amount, upon the Approved Plan Effective Date in the Chapter
11 Cases contemplated in recital H of this Agreement, (“First Installment Payment”) with $7,133,200.78 paid to the United States and $6,349,945.29 paid to the Medicaid Participating States; 

 

	 	b.	 $13,483,146.07, plus interest on the full unpaid amount, shall be due within one year of the First Installment
Payment, with $7,133,200.78 paid to the United States and $6,349,945.29 paid to the Medicaid Participating States; 

  

	 	c.	 $17,977,528.09, plus interest on the full unpaid amount, shall be due within two years First Installment
Payment, with $9,510,934.36 paid to the United States and $8,466,593.73 paid to the Medicaid Participating States; 

  

	 	d.	 $17,977,528.09, plus interest on the full unpaid amount, shall be due within three years of the First
Installment Payment, with $9,510,934.36 paid to the United States and $8,466,593.73 paid to the Medicaid Participating States; 

  

	 	e.	 $29,213,483.15, plus interest on the full unpaid amount shall be due within four years of the First Installment
Payment, with $15,455,268.34 paid to the United States and $13,758,214.81 paid to the Medicaid Participating States; 

  

	 	f.	 $29,213,483.15, plus interest on the full unpaid amount shall be due within five years of the First Installment
Payment, with $15,455,268.34 paid to the United States and $13,758,214.81 paid to the Medicaid Participating States; 

  

	 	g.	 $56,179,775.28, plus interest on the full unpaid amount shall be due within six years of the First Installment
Payment, with $29,721,669.88 paid to the United States and $26,458,105.40 paid to the Medicaid Participating States; 

  

	 	h.	 $56,179,775.28, plus interest on the full unpaid amount shall be due within seven years of the First
Installment Payment, with $29,721,669.89 paid to the United States and $26,458,105.39 paid to the Medicaid Participating States.

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