Document:

exv10w16

Exhibit 10.16

	 	 	 
	

	 	201 Elizabeth Street

Sydney NSW 2000

Australia

DX 107 Sydney

Tel +61 2 9286 8000

Fax +61 2 9283 4144

www.dlaphillipsfox.com

12 January 2009

	 	 	 
	Deed of Mutual Release

	 	 
	 
	 	 
	Unilife Medical Solutions Limited
	 	 
	(ACN 008 071 403)
	 	 
	Jeff Carter
	 	 

 

	 	 	 
	 

	 	DLA Phillips Fox is a member of
	 

	 	DLA Piper Group, an alliance of
	 

	 	independent legal practices. It is a
	 

	 	separate and distinct legal entity.
	 
	 	 
	 

	 	DLA Phillips Fox offices are located
	 

	 	in Adelaide Auckland Brisbane
	 

	 	Canberra Melbourne Perth Sydney
	 

	 	and Wellington.

 

 

 

Table of Contents

	 	 	 	 	 
	Parties
	 	 	1	 
	Background
	 	 	1	 
	Operative provisions
	 	 	1	 
	1 Interpretation
	 	 	1	 
	Definitions
	 	 	1	 
	Construction
	 	 	2	 
	 
	 	 	 	 
	2 Payments
	 	 	2	 
	3 Board Position
	 	 	3	 
	4 Options
	 	 	3	 
	5 Release
	 	 	3	 
	6 Bar to proceedings
	 	 	4	 
	7 Confidential information and non-disclosure of document
	 	 	4	 
	8 Non disparagement
	 	 	5	 
	9 Warranty
	 	 	5	 
	10 Miscellaneous
	 	 	5	 
	Legal costs
	 	 	5	 
	Governing law and jurisdiction
	 	 	5	 
	Severability
	 	 	6	 
	Amendment
	 	 	6	 
	Waiver and exercise of rights
	 	 	6	 
	Further assurance
	 	 	6	 
	Counterparts
	 	 	6	 
	Entire deed
	 	 	6	 
	 
	 	 	 	 
	Execution and date
	 	 	7	 

 

 

 

			
	
	 	Deed of Mutual Release

Parties

Unilife Medical Solutions Limited ACN 008 071 403 of Level 5, 35 Clarence Street, Sydney, New South
Wales 2000 (Company)

Jeff Carter of [residential address omitted] (Executive)

Background

			
	A	 	The Executive has been employed by the Company as its Chief Financial Officer since on or about 23
February 2005 (Employment).

			
	B	 	The Company has determined to terminate the Employment due to redundancy effective on 31 January
2009 (Termination).

			
	C	 	The parties have agreed that the Termination occur on the terms set out in this Deed.

Operative provisions

1 Interpretation

Definitions

	1.1	 	In this Deed:
	 
	 	 	Claims means ail claims, demands, suits, causes of action, damages, debts, costs, verdicts
and judgments whatsoever whether at law or in equity or under any statute.
	 
	 	 	Confidential Information means all documents, submissions, data and material stored by
electronic or other means on which is recorded information which is confidential, secret or
unavailable to the general public in relation to any matter pertaining to the business,
affairs or intellectual property rights of the Group, including all diaries, planning
information, programming information, marketing information, statistics, financial accounts,
documents, papers, information relating to subcontractors, board minutes, management
records, client lists and minutes of meeting (and including copies of all of the above).
	 
	 	 	Group means the Company, each Related Company of the Company and any director, officer,
employee or agent of the Company or of any Related Company of the Company.
	 
	 	 	Letter of Employment means the letter of employment from the Company to the Executive dated
15 February 2005 as varied by a document dated 21 December 2006 and titled “Variation of
Employment Contract Dated 15 February 2005” between the Company and the Executive.
	 
	 	 	Option has the same meaning as ascribed to that term in the rules of the Plan.
	 
	 	 	Plan means the Unitract Limited Employee Share Option Plan.

 

1

 

			
	
	 	Deed of Mutual Release

Related Company means a related body corporate as defined in section 50 of the Corporations
Act 2001.

Share means a share in the capital of the Company.

Construction

	1.2	 	Unless expressed to the contrary, in this Deed:

	 	1.2.1	 	words importing the singular include the plural and vice versa;
	 
	 	1.2.2	 	headings are inserted for convenience only and do not affect the
interpretation of this Deed;
	 
	 	1.2.3	 	where a word or phrase is given a defined meaning, another part of speech or
other grammatical form in respect of that word or phrase has a corresponding meaning;
	 
	 	1.2.4	 	a reference to:

	 	(a)	 	any person includes a reference to any individual,
company, body corporate, association, partnership, joint venture, trust or
government agency;
	 
	 	(b)	 	the word ‘include’ or ‘including’ is to be construed
without limitation;
	 
	 	(c)	 	a statute, ordinance, code or other law includes
regulations and other statutory instruments under it and consolidations,
amendments, re-enactments or replacements of any of them;
	 
	 	(d)	 	a right includes a benefit, remedy, discretion, authority
or power;
	 
	 	(e)	 	any thing (including any amount) is a reference to the
whole or any part of it and a reference to a group of things or persons is a
reference to any one or more of them;
	 
	 	(f)	 	any agreement or document is to that agreement or
document as amended, novated, supplemented or replaced from time to time;
	 
	 	(g)	 	dollars or $ means Australian dollars; and
	 
	 	(h)	 	this Deed means the agreement recorded in this document

2 Payments

	2.1	 	The Company will, within seven days of the Termination and subject to the receipt of this
Deed duly executed by the Executive, pay to the Executive, after making ail and any
appropriate tax deductions:

	 	2.1.1	 	the sum of $68,700.00 (gross) being a payment in lieu of notice;
	 
	 	2.1.2	 	the sum of $206,100.00 (gross) being a redundancy payment; and

 

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	 	Deed of Mutual Release

	 	2.1.3	 	the sum of $29,206.75 (gross) being in respect of accrued annual leave.

3 Board Position

	3.1	 	The parties agree that the Termination does not affect the Executive’s position as a director
and secretary of the Company and the parties acknowledge that the Executive will continue to
be a director and secretary of the Company following the Termination.

4 Options

	4.1	 	The Company acknowledges for the benefit of the Executive that the plan committee that
administers the Plan has determined that since the Executive will remain a director and
secretary of the Company following the Termination, the Executive will continue to be an
“Employee” for the purposes of the Plan and as such the Executive’s rights under the Plan will
be unaffected by the Termination and none of the 2.5 million Options registered in the name of
the Executive (or his nominee) will lapse as a result of the Termination or the execution of
this Deed.

5 Release

	5.1	 	Subject to the terms of this Deed, the Executive hereby releases and discharges each and all
members of the Group from all Claims (with the exception of workers compensation Claims) which
the Executive has or which but for this Deed could, would or might at any time hereafter have
or have had against any member of the Group in respect of or arising out of, either directly
or indirectly, the Employment or the Termination including any Claims in respect of:

	 	5.1.1	 	annual leave entitlements;
	 
	 	5.1.2	 	long service leave entitlements;
	 
	 	5.1.3	 	notice of termination of the Employment or payment in lieu of notice;
	 
	 	5.1.4	 	redundancy or severance pay;
	 
	 	5.1.5	 	salary;
	 
	 	5.1.6	 	any entitlement under the Letter of Employment or an award, enterprise
agreement or other registered or unregistered industrial agreement including in respect
of wages, allowances, penalties, notice, redundancy payments, severance payments and
loadings;
	 
	 	5.1.7	 	superannuation;
	 
	 	5.1.8	 	any securities of the Company, including Options under the Plan and Shares
(except as outlined in clause 4.1 above);
	 
	 	5.1.9	 	director’s fees in relation to service as an executive director of the Group
prior to the date of Termination;

 

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	 	Deed of Mutual Release

	 	5.1.10	 	performance or incentive payments of any description, commissions, bonus payments or
drawings;
	 
	 	5.1.11	 	any other remuneration or employment benefits;
	 
	 	5.1.12	 	loss of reputation, stress, humiliation or embarrassment; or
	 
	 	5.1.13	 	discrimination, harassment, sexual harassment, victimization or vilification.

	5.2	 	To the extent permitted by law (including Part 2D.2 of the Corporations Act 2001 (Cth)) and
subject to clauses 5.3 and 7 of this Deed, the Company hereby releases and discharges the
Executive from ail Claims (with the exception of Claims relating to fraud or misconduct or a
breach of the restraint of trade provisions in the Letter of Employment) which the Company has
or which but for this Deed could, would or might at any time hereafter have or have had
against the Executive in respect of or arising out of, either directly or indirectly, the
Employment.

	5.3	 	The release and discharge in clause 5.2 does not in any way extend to any Claims which the
Group has or could, would or might at any time hereafter have against the Executive in respect
of or arising out of, either directly or indirectly, his position and actions as a director or
secretary of the Company or of any other company in the Group.

	5.4	 	The release and discharge in clause 5.1 will not operate to limit any rights of indemnity
which the Executive may have as a statutory officeholder of the Company or any other member of
the Group under the Constitution of such company, the Corporations Act 2001 (Cth) or, to the
extent permitted by law and the terms of the relevant insurance policy, any rights of
indemnity under any insurance policy maintained by the Company or any other member of the
Group in favor of its statutory officeholders.

6 Bar to proceedings

	6.1	 	The parties agree that this Deed may be pleaded by the parties or any member of the Group as
an absolute bar in any court of law, arbitral tribunal or otherwise in response to any
proceedings or Claim whatsoever brought by or on behalf of either party arising out of or
touching on or concerning the matters referred to or contained in this Deed.

7 Confidential information and non-disclosure of document

	7.1	 	Without in anyway limiting the continuing obligations of the Executive arising from the
Employment with respect to the Company’s confidential information or restraints on post
employment activity, including as referred to in the provisions of the Letter of Employment
titled ‘Business Dealings and Confidentiality’ and ‘Restraints of Trade’, the Executive hereby
covenants with the Company that following Termination the Executive will not use any
Confidential Information whatsoever or disclose any Confidential Information whatsoever to any
person except as required by law.

	7.2	 	The Executive further covenants that the Executive will take all action reasonably necessary
to maintain the confidentiality of any such Confidential Information which is known to the
Executive or of which the Executive becomes aware after the date hereof. This clause will not
apply to any information that becomes generally available to the public (other than as a result of a
breach of this clause by the Executive).

 

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	 	Deed of Mutual Release

	7.3	 	Subject to clause 7.4, the parties agree that they will not disclose the terms of this Deed
to any person other than their legal or financial advisers, or immediate family members on the
condition that they are required to keep the terms of this Deed confidential, or as may be
required by law.
	 
	7.4	 	The parties agree that the Company will be entitled to:

	 	7.4.1	 	lodge an announcement setting out the terms of this Deed with the Australian
Securities Exchange at any time and in such form as the Company determines; and
	 
	 	7.4.2	 	disclose the terms of this Deed in any documents of the Company that it is
required to disclose the information in and the Company will be entitled to disclose
the terms of this Deed in such documents in such form as the Company determines.

8 Non disparagement

	8.1	 	The Executive will not disparage the Company or any member of the Group or make any statement
or publication, whether oral or in writing which does, or is likely to, bring the Group or any
of its members into disrepute or ridicule or otherwise adversely affect their reputations.

9 Warranty

	9.1	 	The Executive warrants that:

	 	9.1.1	 	the Executive has voluntarily entered into this Deed;
	 
	 	9.1.2	 	other than as set out in this Deed, the Company has not made any promises,
representations or inducements to the Executive to enter into this Deed;
	 
	 	9.1.3	 	the Executive has had full opportunity to consult the Executive’s legal
advisers concerning the nature, effect and extent of this Deed; and
	 
	 	9.1.4	 	the Executive is aware that the Company is relying on this warranty in
executing this Deed.

10 Miscellaneous

Legal costs

	10.1	 	The parties will bear their own costs, including legal costs, in connection with the
preparation and execution of this Deed.

Governing law and jurisdiction

	10.2	 	This Deed is governed by and is to be construed in accordance with the laws in force in New
South Wales.

 

5

 

			
	
	 	Deed of Mutual Release

	10.3	 	Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the
courts of New South Wales and any courts which have jurisdiction to hear appeals from any of
those courts and waives any right to object to any proceedings being brought in those courts.

Severability

	10.4	 	Any provision of this Deed which is or becomes illegal, void or unenforceable is severable,
and such provision will be ineffective to the extent only of such illegality, voidness or
enforceability and will not invalidate the remaining provisions.

Amendment

	10.5	 	This Deed may only be varied or replaced by a deed duly executed by both parties.

Waiver and exercise of rights

	10.6	 	A single or partial exercise or waiver of a right relating to this Deed will not prevent any
other exercise of that right or the exercise of any other right.

	10.7	 	A party will not be liable for any loss, cost or expense of the other party caused or
contributed to by the waiver, exercise, attempted exercise, failure to exercise or delay in
the exercise of a right.

Further assurance

	10.8	 	Each party must promptly execute all deeds and do all things that the other party from time
to time reasonably requires of it to effect, perfect or complete the provisions of this Deed
and any transaction contemplated by it.

Counterparts

	10.9	 	This Deed may consist of a number of counterparts and if so the counterparts taken together
will constitute one and the same document.

Entire deed

	10.10	 	This Deed embodies the entire understanding and agreement between the parties as to the
subject matter of this Deed.

	10.11	 	All previous negotiations, understandings, representations, warranties, memoranda or
commitments in relation to, or in anyway affecting, the subject matter of this Deed are merged
in and superseded by this Deed and are of no force or effect whatsoever and neither party will
be liable to the other party in respect of those matters.

 

6

 

			
	
	 	Deed of Mutual Release

	10.12	 	No oral explanation or information provided by either party to the other:

	 	10.12.1	 	affects the meaning or interpretation of this Deed; or
	 
	 	10.12.2	 	constitutes any collateral agreement, warranty or understanding between the parties.

Execution and date

Executed as a deed.

Date: 12 January 2009

Executed as a deed by Unilife Medical

Solutions Limited by:

	 	 	 
	/s/ Jim Bosnjak

	 	/s/ Alan Shortall
	Signature of director

	 	Signature of director
	Name of director: Jim Bosnjak

	 	Name of director: Alan Shortall

Executed as a deed by Jeff Carter in the

presence of:

	 	 	 
	/s/ Robert Snoch

	 	/s/ Jeff Carter
	Signature of witness

	 	Signature of Jeff Carter
	 
	 	 
	Robert Snoch
	 	 
	Name of witness (print)
	 	 

 

7exv10w17

Exhibit 10.17

 

UNILIFE CORPORATION

EMPLOYEE STOCK OPTION PLAN

 

Adopted
by the Board of Directors on:
November 11, 2009

Commencement Date: [                    ] 2009

	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	1 BACKGROUND
	 	 	1	 
	 
	 	 	 	 
	1.1 Name of Plan
	 	 	1	 
	1.2 Purpose of the Plan
	 	 	1	 
	1.3 Rules of Plan binding
	 	 	1	 
	1.4 Commencement of Plan
	 	 	1	 
	1.5 Governing law
	 	 	1	 
	 
	 	 	 	 
	2 DICTIONARY AND INTERPRETATION
	 	 	1	 
	 
	 	 	 	 
	2.1 Dictionary
	 	 	1	 
	2.2 Interpretation
	 	 	7	 
	 
	 	 	 	 
	3 PARTICIPATION AND ELIGIBILITY
	 	 	7	 
	 
	 	 	 	 
	3.1 Employees and nominees only to be granted Options
	 	 	7	 
	3.2
Compliance with Relevant Laws
	 	 	8	 
	3.3
Limitation on Offers that can be made
	 	 	8	 
	 
	 	 	 	 
	4 OFFERS
	 	 	8	 
	 
	4.1 Plan Committee may make Offers
	 	 	8	 
	4.2 Contents of Offer
	 	 	8	 
	4.3 Nominee of Employee
	 	 	9	 
	 
	 	 	 	 
	5 APPLICATION FOR OPTIONS
	 	 	9	 
	 
	5.1 Acceptance of Offer
	 	 	9	 
	5.2 Lapse of Offer
	 	 	9	 

 

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	6 ISSUE OF OPTIONS
	 	 	10	 
	 
	 	 	 	 
	6.1 Acceptance of Application Form
	 	 	10	 
	6.2 Issue of Options
	 	 	10	 
	6.3 Becoming a Participant
	 	 	10	 
	6.4 Option Certificates
	 	 	10	 
	6.5 No consideration payable for Options
	 	 	10	 
	6.6 Entitlement to underlying Shares
	 	 	10	 
	6.7 No interest in Shares until issued
	 	 	10	 
	 
	 	 	 	 
	7 EXERCISE OF OPTIONS
	 	 	11	 
	 
	 	 	 	 
	7.1 Exercise during Exercise Period
	 	 	11	 
	7.2 Performance Hurdles
	 	 	11	 
	7.3 Waiver of Performance Hurdles where Special Circumstances or Change of Control
	 	 	11	 
	7.4 Waiver of Performance Hurdles at discretion of Plan Committee
	 	 	11	 
	7.5 Exercise of Options
	 	 	11	 
	7.6 Issue of Shares
	 	 	11	 
	7.7 Quotation of Shares
	 	 	12	 
	7.8 Partial exercise of Options
	 	 	12	 
	7.9 Replacement Option Certificate
	 	 	12	 
	 
	 	 	 	 
	8 RESTRICTION ON DISPOSAL OF SHARES
	 	 	12	 
	 
	 	 	 	 
	8.1 Restrictions on Shares
	 	 	12	 
	8.2 Restriction on disposal of Shares in Plan
	 	 	12	 
	8.3 Holding lock on Restricted Shares
	 	 	12	 
	8.4 Paper transfers
	 	 	13	 
	8.5 Withdrawal of Restricted Shares from Plan
	 	 	13	 
	8.6 Acceptance of application to withdraw Restricted Shares
	 	 	13	 
	8.7 Company not liable under Rule 8.6
	 	 	13	 
	8.8 Deemed withdrawal application
	 	 	14	 
	8.9 Removal of holding lock
	 	 	14	 
	8.10 Cease to be in Plan upon acceptance of withdrawal application
	 	 	14	 
	 
	 	 	 	 
	9 LAPSE OF OPTIONS
	 	 	14	 
	 
	 	 	 	 
	9.1 Lapse of Options on Last Exercise Date
	 	 	14	 
	9.2 Lapse of vested Options where Performance Hurdles satisfied but there
is a cessation of employment
	 	 	15	 
	9.3 Additional lapsing events
	 	 	15	 
	9.3A Lapsing
of Options on a Change of Control Event
	 	 	15	 
	9.4 Cessation of rights
	 	 	16	 
	 
	 	 	 	 
	10 DEALINGS WITH OPTIONS
	 	 	16	 
	 
	 	 	 	 
	10.1 Options are personal
	 	 	16	 
	10.2 No unauthorised disposal
	 	 	16	 
	10.3 Permitted transfer of Options
	 	 	16	 

 

-ii-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	11 PARTICIPATION RIGHTS, RIGHTS ISSUES, REORGANISATIONS OF CAPITAL AND WINDING UP
	 	 	16	 
	 
	 	 	 	 
	11.1 New issues
	 	 	16	 
	11.2 Dividends, distributions and rights issues
	 	 	16	 
	11.3 Reconstruction of capital
	 	 	17	 
	11.4 Liquidation or Dissolution
	 	 	17	 
	11.5 Fractions of Shares
	 	 	17	 
	11.6 Cumulative application
	 	 	17	 
	11.7 Calculations and adjustments
	 	 	17	 
	11.8 Notice of change
	 	 	17	 
	 
	 	 	 	 
	12 NO QUOTATION OF OPTIONS
	 	 	17	 
	 
	 	 	 	 
	13 ADMINISTRATION OF THE PLAN
	 	 	18	 
	 
	 	 	 	 
	13.1 Plan Committee’s powers
	 	 	18	 
	13.2 Exercise of powers or discretion
	 	 	18	 
	13.3 Decisions binding
	 	 	18	 
	13.4 Expenses and costs
	 	 	18	 
	13.5 Tax
	 	 	19	 
	 
	 	 	 	 
	14 AMENDMENT TO RULES
	 	 	19	 
	 
	 	 	 	 
	14.1 Board may amend Rules
	 	 	19	 
	14.2 Consent of Participants
	 	 	19	 
	 
	 	 	 	 
	15 RIGHTS OF PARTICIPANTS
	 	 	19	 
	 
	 	 	 	 
	15.1 No conferred rights
	 	 	19	 
	15.2 Plan not part of employment contract
	 	 	20	 
	15.3 Voting at general meetings
	 	 	20	 
	 
	 	 	 	 
	16 PARTICIPATION IN OTHER PLANS
	 	 	20	 
	 
	 	 	 	 
	17 ADVICE
	 	 	20	 
	 
	 	 	 	 
	18 NOTICES
	 	 	20	 
	 
	 	 	 	 
	19 DATA PROTECTION
	 	 	20	 
	 
	 	 	 	 
	20 COMPLIANT WITH SECURITIES LAWS, LISTING AND REGISTRATION
	 	 	21	 
	 
	 	 	 	 
	APPENDIX A: PROVISIONS FOR CALIFORNIA
RESIDENTS  	 	 	A - 1	 

 

-iii-

 

RULES OF THE UNILIFE CORPORATION EMPLOYEE STOCK OPTION PLAN

	1	 	Background

	 
	1.1	 	Name of Plan

	 
	 	 	The Plan is called the “Unilife Corporation Employee Stock Option Plan”.

	 
	1.2	 	Purpose of the Plan

	 
	 	 	The purpose of the Plan is to:

	 	(a)	 	assist in the motivation and retention of Employees;

	 
	 	(b)	 	encourage Employees to work in ways that will enhance shareholder value and
give them the opportunity to have a greater involvement with and to share in the future
growth and profitability of the Company;

	 
	 	(c)	 	recognise the importance of the Employees to the long term performance and
success of the Company and to encourage Employees to focus on the long term goals of
the Company; and

	 
	 	(d)	 	provide Employees with a means of acquiring a right to acquire Shares in the
Company, in accordance with these Rules.

	1.3	 	Rules of Plan binding

The Plan will operate in accordance with the terms and conditions set out in these Rules and
the Rules will bind each Group Company, each Participant and each Nominator.

With respect to Options granted to California
residents prior to a public offering of capital stock of the Company that is effected pursuant to a registration
statement filed with, and declared effective by, the SEC under the Securities Act of 1933, as amended, and only
to the extent required by applicable law, the provisions detailed in Appendix A shall apply notwithstanding
anything in the Plan, Application Form, or Option Certificate to the contrary.

	1.4	 	Commencement of Plan

	 
	 	 	The Plan will take effect on such date as the Board decides.

	 
	1.5	 	Governing law

This Plan is governed by and is to be construed in accordance with the laws of Delaware,
USA, without regard to its conflict of laws principles, and these Rules are to be interpreted
subject to all Relevant Laws. Each Participant, the Company and any Associated Body
Corporate irrevocably and unconditionally agrees and submits to the personal jurisdiction
and venue in the federal or state courts in the districts which
include the city and state in which the principal executive offices
of the Company are located on the date on which the suit arises with respect to any suits relating to the Options.

	2	 	Dictionary and interpretation

	 
	2.1	 	Dictionary

	 
	 	 	In these Rules, unless the context otherwise requires:

Application Form means a duly completed and executed application for the issue of Options
made by an Employee or his or her nominee approved under Rule 4.3 in respect of an Offer, in
a form approved by the Plan Committee from time to time;

 

1

 

ASIC means the Australian Securities and Investments Commission;

Associated Body Corporate means a body corporate:

	 	(a)	 	that is a related body corporate of the Company pursuant to section 50 of the
Corporations Act; or

	 
	 	(b)	 	that has voting power in the Company of not less than 20%; or

	 
	 	(c)	 	in which the Company has voting power of not less than 20%;

(applying the definition of “voting power” contained in section 610 of the Corporations
Act);

ASX means, as the context requires:

	 	(a)	 	ASX Ltd ACN 008 624 691 and any successor body corporate;
or

	 
	 	(b)	 	the financial market operated by the body corporate referred to in paragraph
(a);

Board means all or some of the directors of the Company acting as a board or its delegate;

Business Day means any day on which trading banks generally are open for business in Sydney
excluding a Saturday, Sunday or a public holiday in Sydney;

CDIs means CHESS Depositary Interests;

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

	 	(a)	 	a change of Ownership of the Company;

	 
	 	(b)	 	a change of Effective Control of the Company; or

	 
	 	(c)	 	a change of Ownership of Assets of the Company;

as described in these Rules and construed consistent with Section 409A of the Code.
For the purposes of a Change of Control Event, fair market value is determined by the Board,
and share ownership is determined under section 318(a) of the Code. A Change of Control
Event excludes any transfer to a related person as described in Section 409A of the Code or
a public offering of the Shares;

Change of Effective Control of the Company means the date on which a majority of
members of the Company’s full board of directors is replaced during any 12-month period by
directors whose appointment or election is not endorsed by a majority of the members of the
Company’s full board of directors before the date of the
appointment or election;

Change of Ownership of Assets of the Company means the date on which any one person
acquires, or Persons Acting as a Group acquire (or has or have acquired during the 12 month
period ending on the date of the most recent acquisition by such Person or Persons), assets
from the Company that have a total gross
fair market value more than 50% of the total gross fair market value of all of the
assets of the Company immediately before such acquisitions. For this purpose, gross fair
market value means the value of the assets of the Company, or the value of the assets being
disposed of, determined without regard to any liabilities associated
with such assets;

 

2

 

Change of Ownership of the Company means the date on which any one Person acquires, or
Persons Acting as a Group acquire, ownership of Shares that, together with the Shares held
by such Person or Persons Acting as Group, constitutes more than 50% of the total fair
market value or total voting power of the Shares of the Company. However, if any one Person
is, or Persons Acting as a Group are, considered to own more than 50% of the total fair
market value or total voting power of the Shares of the Company, the acquisition of
additional Shares by the same Person or Persons Acting as a Group is not considered to cause
a Change of Ownership of the Company or to cause a Change of Effective Control of the
Company. An increase in the percentage of Shares owned by any one Person, or Persons Acting
as a Group, as a result of a transaction in which the Company acquires its Shares in
exchange for property will be treated as an acquisition of Shares;

Code means the United States Internal Revenue
Code of 1986, as amended, and any regulations promulgated thereunder;

Company means Unilife Corporation, a corporation incorporated in Delaware, USA;

Corporations Act means the Corporations Act 2001 (Cth);

Employee means any full-time or part-time employee of any Group Company and includes any
such employee on maternity leave, long service leave or other special leave as approved by
the Plan Committee from time to time and also includes a director of any Group Company but
does not include an employee who has been given notice of dismissal for misconduct from
employment with a Group Company (or has given notice of resignation from such employment in
order to avoid such dismissal) whom the Plan Committee, in its absolute discretion,
determines is eligible to receive an Offer under the Plan; provided, however, that solely
for purposes of the grant of Options under the Plan in provision of the option scheme
consideration pursuant to that certain Merger Implementation Agreement dated 1 September
2009 between Unilife Medical Solutions Limited and the Company, the term “Employee” shall
include all persons who were holders of UMSL Options notwithstanding the person’s current
employment status or lack thereof with any Group Company;

Encumbrance means any mortgage, charge, lien, pledge, arrangement for retention of title,
any right, power, interest or arrangement having the purpose or effect of providing security
for, or otherwise protecting against default in respect of, the obligation of any person or
any other third party interest of any nature whatsoever;

Exchange Act means the United States Securities Exchange Act of 1934, as amended, including
the rules promulgated thereunder;

Exercise Notice means a duly completed and executed notice of exercise of an Option by a
Participant, in a form approved by the Plan Committee from time to time;

Exercise Period means the period commencing on the First Exercise Date and ending on the
Last Exercise Date;

Exercise Price means the amount payable by the Participant on the exercise of the Option,
being the amount determined by the Plan Committee and set out in the Offer (adjusted, if
appropriate, in accordance with Rule 11);

 

3

 

First Exercise Date with respect to an Option means the earlier of:

	 	(a)	 	the date on which the Option vests as determined by the Plan Committee and as
specified in the Offer in respect of that Option;

	 
	 	(b)	 	the date on which a Special Circumstance arises in respect of the Participant
holding the Option; and

	 
	 	(c)	 	the period of 7 days
immediately prior to the date on which the Change of Control Event
occurs, or such other period as determined by the Plan Committee;

Grant Date means, with respect to an Option, the date on which the Plan Committee grants the
Option to a Participant;

Group means the Company and each Subsidiary;

Group Company means any company in the Group;

Last Exercise Date with respect to an Option means, unless otherwise specified in an Offer:

	 	(a)	 	where the Performance Hurdles in respect of an Option have not been satisfied,
the date 3 months after the fifth anniversary of the Grant Date; or

	 
	 	(b)	 	where the Performance Hurdles in respect of an Option have been satisfied, the
date 6 months after the fifth anniversary of the Grant Date; or

	 
	 	(c)	 	if a Special Circumstance arises in respect of a Participant holding an Option,
the date 3 months (or such longer period as may be determined by the Plan Committee)
after the Special Circumstance arises; or

	 
	 	(d)	 	if a Change of Control Event occurs while a Participant holds an Option, the
date immediately prior to the date of the Change of Control Event;

Legal Personal Representative means the executor or trustee of the will or an administrator
of the estate of a deceased person, the trustee of the estate of a person under a legal
disability or a person who holds an enduring power of attorney granted by another person;

Listing Rules means, while the Company is admitted to the official list of the ASX, the
listing rules of the ASX and any other rules of the ASX that are applicable. In the event
that the Shares become listed for trading on any other securities exchange or market, the
term “Listing Rules” shall also mean the applicable rules of such exchange or market;

Nominator means an Employee who has renounced an Offer in favour of a nominee approved under
Rule 4.3 which nominee has accepted that Offer;

Offer means an invitation to an Employee made by the Company under Rule 4.1 to apply for
Options;

Option means an option issued to a Participant under the Plan to subscribe for one Share on
the terms set out in the Offer and in this Plan;

 

4

 

Option Certificate means a certificate issued under these Rules in the form approved by the
Plan Committee from time to time, or if the Plan Committee determines that Options are
uncertificated, then a statement issued to the Participant, disclosing:

	 	(a)	 	the number of Options entered in the register of Option holders in respect of
the Participant; and

	 
	 	(b)	 	the information in Rule 6.4;

Participant means a person who holds Options that have been issued under the Plan including,
where a Participant dies or becomes subject to a legal disability, the Legal Personal
Representative of that Participant;

Performance Hurdles means, in respect of any Option, those conditions (if any) determined by
the Plan Committee and specified in an Offer that, subject to these Rules, must be satisfied
before the Option can be exercised;

Person means any individual, entity or group within the meaning of section 13(d)(3) or
14(d)(2) of the Exchange Act, other than employee benefit plans sponsored or maintained by
the Company and by entities controlled by the Company or an underwriter of the Shares of the
Company in a registered public offering;

Persons Acting as a Group means persons who are owners of a corporation that enters into a
merger, consolidation, purchase or acquisition of shares, or similar business transaction
with the Company. If a Person owns shares in both corporations that enter into a merger,
consolidation, purchase or acquisition of shares, or similar transaction, such shareholder
is considered to be a Person Acting as a Group with other shareholders only with respect to
the ownership in that corporation before the transaction giving rise to the change and not
with respect to the ownership interest in the other corporation. Persons will not be
considered to be Persons Acting as a Group solely because they purchase assets of the same
corporation at the same time or purchase or own shares of the same corporation at the same
time, or as a result of the same public offering;

Plan means means this Employee Stock Option Plan established and operated in accordance with
these Rules;

Plan Committee means the committee of the Board to which power to administer the Plan has
been delegated or if there has been no delegation, the Board;

Redundancy means in respect of a Participant the termination of employment with the Company
or any Group Company of that Participant (if he or she is an Employee) or of that
Participant’s Nominator (if the Participant is not an Employee) by reason of a restructure
or a state of affairs within the Company or Group Company whereby the position previously
occupied by that person no longer exists within the Company or any Group Company and where
the Plan Committee in its absolute discretion determines that such an event qualifies as a
Redundancy for the purposes of these Rules;

 

5

 

Relevant Law means one or more, as the context requires, of the following:

	 	(a)	 	the Corporations Act including any and all regulations made under the
Corporations Act;

	 
	 	(b)	 	the Listing Rules;

	 
	 	(c)	 	the charter of the Company;

	 
	 	(d)	 	the United States Securities Act of 1933, as amended (including the
rules thereunder), Exchange Act and any other applicable United States federal or state law, including
without limitation the Delaware General Corporation Law; or

	 
	 	(e)	 	any practice note, policy statement, class order, declaration, guideline,
policy or procedure pursuant to the provisions of which any of the SEC, ASIC or ASX is
authorised or entitled to regulate, implement or enforce, either directly or
indirectly, the provisions of any of the foregoing statutes, regulations or rules or
any conduct of any duly authorised person, pursuant to any of the above mentioned
statutes, regulations or rules;

Restricted Shares means Shares held under the Plan which are subject to the restrictions
under Rule 8;

Retirement means in respect of a Participant resignation from employment with the Company or
any Group Company of that Participant (if he or she is an Employee) or of that Participant’s
Nominator (if the Participant is not an Employee) in circumstances where the Board is
satisfied that person intends no longer to work on a full-time basis;

Rules means the rules governing the operation of the Plan set out in this document, as
amended from time to time;

SEC means the United States Securities and Exchange Commission;

Share
means a fully paid share of the common stock of the Company, par value US$.01 per
share, in the form of either common stock or CDIs;

Special Circumstances with respect to a Participant means:

	 	(a)	 	the Retirement of the Participant;

	 
	 	(b)	 	the Redundancy of the Participant;

	 
	 	(c)	 	the death of the Participant or that Participant’s Nominator;

	 
	 	(d)	 	the Total and Permanent Disablement of the Participant; or

	 
	 	(e)	 	any other circumstances determined by the Plan Committee in its absolute
discretion at any time (whether in relation to the Participant or the Nominator, a
class of Participants or a class of Nominators, a particular circumstance or a class of
circumstances) and whether before or after the Grant Date and which is notified to the
Participant and the relevant Nominator in writing;

Subsidiary means a body corporate (whether incorporated under the Corporations Act or not)
of which the Company is a holding company for the purposes of Division 6 of Part 1.2 of the
Corporations Act;

 

6

 

Tax includes any tax, levy, charge, impost, GST, deduction, compulsory loan, duty or
withholding which is assessed, levied or imposed by any government or any governmental,
semi-governmental or judicial entity or authority and includes any interest, penalty, fine,
charge, fee or other amount, imposed on or in respect of the above;

Total and Permanent Disablement means in respect of a Participant the disablement of that
Participant (if he or she is an Employee) or of that Participant’s Nominator (if that
Participant is not an Employee) the effect of which is, in the opinion of the Plan
Committee, likely to be permanent and will prevent that person from continuing his or her
current employment with the Company or any Group Company;

UMSL Options means share options granted under the Rules of the Unilife Medical Solutions
Limited Employee Share Option Plan; and

vest in relation to an Option means become capable of exercise in accordance with the Rules
subject only to the satisfaction of the Performance Hurdles, if any, in respect of that
Option (and vested and vesting shall have a corresponding meaning).

	2.2	 	Interpretation

In these Rules, unless the context otherwise requires:

	 	(a)	 	headings are for convenience only and shall not affect the interpretation of
these Rules;

	 
	 	(b)	 	words denoting the singular include the plural, and the converse also applies;

	 
	 	(c)	 	words denoting any gender include all genders;

	 
	 	(d)	 	any reference to any agreement or document (including these Rules) includes
that agreement or document as amended, consolidated, novated, supplemented or replaced
from time to time;

	 
	 	(e)	 	any reference to a Rule or paragraph means a rule or paragraph of these Rules;

	 
	 	(f)	 	references to any legislation or a provision of any legislation includes a
modification or re-enactment of the legislation or a legislative provision substituted
for, and all legislation and statutory instruments and regulations issued under, the
legislation; and

	 
	 	(g)	 	where an act or thing must be done on a particular day or within a particular
period, that act or thing must be done before, and that period ends at, 5.00 pm Sydney
time on the relevant day.

	3	 	Participation and eligibility

	 
	3.1	 	Employees and nominees only to be granted Options

	 
	 	 	Unless the Plan Committee determines otherwise, no Options may be granted to a person under
the Plan unless the person is, as at the Grant Date, an Employee or a nominee of an Employee
who is approved under Rule 4.3.

 

7

 

	3.2	 	Compliance with Relevant Laws

	 
	 	 	No Option may be offered or granted to, or exercised by, an Employee or his or her nominee
approved under Rule 4.3, or a Participant (as applicable) if to do so would contravene a
Relevant Law.

	 
	3.3	 	Limitation on Offers that can be made

	 
	 	 	The Plan Committee must not offer any Options to an Employee under the Plan if the total
number of Shares to be received on exercise of the Options the subject of the Offer, when
aggregated with:

	 	(a)	 	the number of Shares which would be issued were each outstanding offer with
respect to Shares, units of Shares and options to acquire unissued Shares, being an
offer made or option acquired pursuant to the Plan or any other employee share or
option scheme extended only to employees or directors of the Company or an Associated
Body Corporate to be accepted or exercised; and

	 
	 	(b)	 	the number of Shares issued during the previous five years pursuant to the Plan
or any other employee share or option scheme extended only to employees or directors of
the Company or an Associated Body Corporate;

but disregarding any offer made, or option acquired or Share issued by way of or as a result
of:

	 	(c)	 	an offer to a person situated at the time of receipt of the offer outside
Australia; or

	 
	 	(d)	 	an offer that did not need disclosure to investors because of section 708 of
the Corporations Act; or

	 
	 	(e)	 	an offer that did not require the giving of a Product Disclosure Statement
because of section 1012D of the Corporations Act; or

	 
	 	(f)	 	an offer made under a disclosure document or Product Disclosure Statement,

	 	 	would exceed 5% of the total number of issued Shares as at the time of the Offer.

	 
	4	 	Offers

	 
	4.1	 	Plan Committee may make Offers

Subject to these Rules, the Plan Committee in its discretion may from time to time make
Offers to Employees.

	4.2	 	Contents of Offer

An Offer must be in writing and may state, as applicable:

	 	(a)	 	the name and address of the Employee to whom the Offer is made;

	 
	 	(b)	 	the date of the Offer;

 

8

 

	 	(c)	 	the period in which the invitation constituted by the Offer can be accepted by
the Employee or his or her nominee approved under Rule 4.3;

	 
	 	(d)	 	the maximum number of Options which may be applied for and the number of Shares
to which the Options relate;

	 
	 	(e)	 	the expected Grant Date of the Options the subject of the Offer;

	 
	 	(f)	 	the expected Exercise Period of the Options the subject of the Offer;

	 
	 	(g)	 	the Exercise Price or the manner of determining the Exercise Price of the
Options the subject of the Offer;

	 
	 	(h)	 	any Performance Hurdles that attach to the Options the subject of the Offer
including the date, if any, by which the Performance Hurdle must be satisfied;

	 
	 	(i)	 	the minimum number of Options which may be exercised at any one time (if any);
and

	 
	 	(j)	 	any other terms and conditions applicable to the Offer, including any other
matters required to be specified in the Offer by any Relevant Law.

	4.3	 	Nominee of Employee

	 	(a)	 	An Employee who receives an Offer may renounce the Offer in favour of his or
her nominee who has been approved by the Plan Committee in its absolute discretion
before the end of the period in which the invitation constituted by the Offer can be
accepted (the “acceptance period”).

	 
	 	(b)	 	The Employee must provide the Plan Committee with written notice of the details
of the nominee in whose favour they wish to renounce the Offer at least 3 (three)
Business Days prior to the end of the acceptance period unless otherwise agreed by the
Plan Committee. The Plan Committee may in its absolute discretion accept or reject a
proposed nominee.

	 
	 	(c)	 	If an Employee advises the Plan Committee of its proposed nominee in compliance
with this Rule, the Plan Committee must inform the Employee of its acceptance or
rejection of the proposed nominee at least 2 (two) Business Days prior to the close of
the acceptance period.

	5	 	Application for Options

	 
	5.1	 	Acceptance of Offer

An Employee or his or her nominee approved under Rule 4.3 may accept the invitation
constituted by an Offer by giving to the Company an Application Form within the acceptance
period specified in the Offer.

	5.2	 	Lapse of Offer

An Offer not accepted in accordance with Rule 5.1 lapses unless the Plan Committee
determines otherwise.

 

9

 

	6	 	Issue of Options

	 
	6.1	 	Acceptance of Application Form

The Plan Committee may, within 30 days after receiving a duly completed Application Form but
subject to the conditions of the Offer, approve and accept the Application Form.

	6.2	 	Issue of Options

Following acceptance of an Application Form under Rule 6.1, the Company will:

	 	(a)	 	issue to the Employee or his or her nominee approved under Rule 4.3 all of the
Options the subject of the Application Form; and

	 
	 	(b)	 	notify the Employee or his or her nominee approved under Rule 4.3 in writing of
the Grant Date and the Exercise Period of those Options.

	6.3	 	Becoming a Participant

An Employee or his or her nominee approved under Rule 4.3 becomes a Participant and is
bound by these Rules upon the issue of an Option. A Nominator will become bound by these
Rules upon the issue of an Option to the relevant nominee.

	6.4	 	Option Certificates

The Company must give a Participant one or more Option Certificates stating:

	 	(a)	 	the number of Options issued to the Participant;

	 
	 	(b)	 	the Exercise Price of those Options;

	 
	 	(c)	 	the Exercise Period of those Options; and

	 
	 	(d)	 	the Grant Date of those Options.

	6.5	 	No consideration payable for Options

	 
	 	 	No monetary consideration is payable by Participants for the issue of Options under the Plan.

	 
	6.6	 	Entitlement to underlying Shares

Subject to these Rules, each Option confers on its holder the entitlement to subscribe for
and be issued one fully paid Share at the Exercise Price. Whilst the Company remains listed
on ASX, the Participant will be entitled to elect whether to receive the Shares in the form
of common stock of the Company or as CDIs.

	6.7	 	No interest in Shares until issued

A Participant has no interest in a Share the subject of an Option held by the Participant
unless and until the Share is issued to that Participant under these Rules.

 

10

 

	7	 	Exercise of Options

	 
	7.1	 	Exercise during Exercise Period

Subject
to Rules 3.2, 7 and 9, an Option may be exercised at any time during the Exercise
Period for that Option.

	7.2	 	Performance Hurdles

Subject to Rules 7.3 and 7.4, if the Offer in respect of an Option has specified any
Performance Hurdles, that Option may not be exercised unless and until those Performance
Hurdles have been satisfied, reached or met.

	7.3	 	Waiver of Performance Hurdles where Special Circumstances or Change of Control

The Performance Hurdles attaching to an Option will be automatically waived on the
occurrence of a Special Circumstance in respect of the Participant or on the occurrence of a
Change of Control Event.

	7.4	 	Waiver of Performance Hurdles at discretion of Plan Committee

The Plan Committee may, at its absolute discretion, by notice to the Participant and the
relevant Nominator reduce or waive the Performance Hurdles attaching to an Option in whole
or in part at any time and in any particular case.

	7.5	 	Exercise of Options

Subject to these Rules, Options that have not lapsed and are able to be exercised in
accordance with these Rules may be exercised by the Participant giving to the Company:

	 	(a)	 	an Exercise Notice;

	 
	 	(b)	 	the Option Certificate for those Options; and

	 
	 	(c)	 	a cheque payable to the Company (or another form of payment acceptable to the
Plan Committee) for the amount determined by multiplying the number of Options then
being exercised by the Exercise Price of those Options.

	7.6	 	 Issue of Shares

	 	(a)	 	After receipt of the full amount payable by a Participant in accordance with
Rule 7.5 the Company will, subject to Rule 3.2, issue to the Participant that number of
Shares that relate to the Options being exercised.

	 
	 	(b)	 	Shares issued by the Company under the Plan will on and from the date of issue:

	 	(i)	 	be credited as fully paid;

	 
	 	(ii)	 	rank equally with all existing issued Shares in respect of all rights issues
and dividends which have a record date for determining entitlements on or after the
date of issue of those Shares; and

	 
	 	(iii)	 	otherwise rank equally with Shares of the Company that are on
issue at the time of issue.

	 	(c)	 	The Participant to whom the Shares are issued under the Plan will be deemed to
have
agreed to be bound by the Company’s charter in respect of those Shares.

 

11

 

	7.7	 	Quotation of Shares

If Shares are quoted on the financial market operated by the ASX at the time of issue of
Shares under the Plan, the Company must apply for official quotation of those Shares issued
under the Plan on the financial market operated by the ASX and any other financial markets
on which Shares are then quoted.

	7.8	 	Partial exercise of Options

	 	(a)	 	A Participant may only exercise Options in multiples of 100 or such other
multiple as the Plan Committee determines unless the Participant exercises all Options
that are covered by a certificate that are able to be exercised by him or her at that
time.

	 
	 	(b)	 	The exercise by a Participant of only some of the Options held by the
Participant does not affect the Participant’s right to exercise at a later date in
accordance with the Rules other Options held by the Participant.

	7.9	 	Replacement Option Certificate

If a Participant submits an Exercise Notice in respect of only part of the Options covered
by an Option Certificate, the Company must issue an Option Certificate stating the remaining
number of Options held by the Participant.

	8	 	Restriction on disposal of Shares

	 
	8.1	 	Restrictions on Shares

All Shares acquired pursuant to an exercise of Options are subject to the restrictions set
out in this Rule 8, unless the holder of the Shares or the relevant Nominator has at the
time of exercise of the Option already ceased employment with the Group or such restrictions
are in contravention of Relevant Law.

	8.2	 	Restriction on disposal of Shares in Plan

A holder of Restricted Shares must not grant an Encumbrance over, dispose of or otherwise
deal with (or purport to grant an Encumbrance over, dispose of or otherwise deal with) any
of those Restricted Shares (or any interest in those Restricted Shares) while those
Restricted Shares are held in the Plan and are subject to these Rules.

	8.3	 	Holding lock on Restricted Shares

Subject to the Listing Rules, the Company must apply a holding lock or ensure that such a
holding lock is applied in respect of all Restricted Shares so as to prevent the transfer of
those Restricted Shares.

 

12

 

	8.4	 	Paper transfers

Subject to the Listing Rules, the Company must not register any paper transfer that it
receives in respect of Restricted Shares.

	8.5	 	Withdrawal of Restricted Shares from Plan

A holder of Restricted Shares may apply in writing to the Plan Committee at any time to
withdraw all of or a portion of the Restricted Shares held by the holder from the Plan.

	8.6	 	Acceptance of application to withdraw Restricted Shares

	 	(a)	 	The Plan Committee may in its absolute discretion refuse to accept an
application to
withdraw any Restricted Shares from the Plan:

	 	(i)	 	if any debts owed by the holder or the relevant Nominator to
any Group Company have not been repaid or arrangements have not been made for
repayment; or

	 
	 	(ii)	 	where any of the circumstances set out in Rule 9.2(a) have
occurred, unless the Group has been recompensed for any loss or damage suffered
in those circumstances or arrangements satisfactory to the Plan Committee have
been made.

	 	(b)	 	Without limiting the powers of the Plan Committee, the Plan Committee may
determine that the holder of Restricted Shares is to sell all or any of those
Restricted Shares and apply the proceeds to repay any debt referred to at paragraph
(a)(i) above and/or to recompense the Group for any loss suffered as a result of any of
the circumstances referred to in paragraph (a)(ii) above and pay any balance to the
holder.

	 
	 	(c)	 	The holder of Restricted Shares appoints the Plan Committee as his or her
attorney to do all things necessary to sell Restricted Shares in respect of which the
Plan Committee has made a determination under paragraph (b) and to do all things
necessary to give effect to paragraph (b).

	 
	 	(d)	 	Subject to paragraphs (a) and (b), the Plan Committee must not unreasonably
refuse to accept an application to withdraw Restricted Shares from the Plan.

	 
	 	(e)	 	A holder of Restricted Shares must not lodge a withdrawal application in
respect of any Restricted Shares if it would breach or may result in a breach of the
insider trading provisions of Relevant Law and any approval of the withdrawal
application may be withheld or delayed by the Plan Committee where the Plan Committee
in its reasonable opinion forms the view that such approval is not appropriate at that
time.

	8.7	 	Company not liable under Rule 8.6

The Company is not liable and will not be held responsible to the holder of Restricted
Shares for or in relation to any action taken or any inaction by the Company or the Plan
Committee under Rule 8.6.

 

13

 

	8.8	 	Deemed withdrawal application

A holder of Restricted Shares is on the occurrence of any of the following events deemed to
have made an application under Rule 8.5 to withdraw all Restricted Shares held by the holder
at that time:

	 	(a)	 	the ceasing of employment with the Group of that holder or of the relevant
Nominator;

	 
	 	(b)	 	the occurrence of a Special Circumstance;

	 
	 	(c)	 	where a Change of Control Event occurs;

	 
	 	(d)	 	the day immediately following the fifth anniversary of the date of issue of the
Restricted Shares; or

	 
	 	(e)	 	the day immediately following the suspension or termination of the Plan in
accordance with the Rules.

	8.9	 	Removal of holding lock

An application for withdrawal served under Rule 8.5 or deemed to have been made under Rule
8.8 is deemed to have been accepted by the Company by the lifting of any holding lock on the
relevant Restricted Shares.

	8.10	 	Cease to be in Plan upon acceptance of withdrawal application

Following acceptance under Rule 8.9:

	 	(a)	 	the relevant Restricted Shares cease to be held in the Plan and subject to
these Rules;

	 
	 	(b)	 	the relevant Restricted Shares cease to be subject to restriction on disposal
under Rules 8.2 to 8.9; and

	 
	 	(c)	 	the Plan Committee must, as soon as practicable, notify the holder in writing
of the Shares in respect of which the holding lock has been lifted and the time at
which it was lifted.

	9	 	Lapse of Options

	 
	9.1	 	Lapse of Options on Last Exercise Date

Subject
to Rule 9.3A, an Option which has not previously lapsed pursuant to any other provision of these Rules,
including Rules 9.2 and 9.3, will automatically lapse at 5.00pm (Sydney time) on the Last
Exercise Date unless otherwise determined by the Plan Committee.

 

14

 

	9.2	 	Lapse of vested Options where Performance Hurdles satisfied but there is a cessation
of employment

Unless previously lapsed, an Option which has vested and in respect of which the applicable
Performance Hurdles have been satisfied will lapse on the first to occur of:

	 	(a)	 	a determination of the Plan Committee that the Option should lapse because the
Participant (if he or she is an Employee) or that Participant’s Nominator (if the
Participant is not an Employee), in the Plan Committee’s opinion:

	 	(i)	 	has been dismissed or removed from office for a reason which
entitles a Group Company to dismiss that person without notice;

	 
	 	(ii)	 	has committed an act of fraud, defalcation or gross misconduct
in relation to the affairs of a Group Company (whether or not charged with an
offence); or

	 
	 	(iii)	 	has breached any of the Rules; and

	 	(b)	 	the date that is 3 months after the date of cessation or termination of
employment of the Participant (if he or she is an Employee) or that Participant’s
Nominator (if the Participant is not an Employee) with the Group (other than due to the
occurrence of a Special Circumstance in which case Rule 9.1 will apply or the
occurrence of an event set out in subparagraph (a) in which case that subparagraph will
apply), unless otherwise determined by the Plan Committee.

	9.3	 	Additional lapsing events

Unless previously lapsed, an Option which has either:

	 	(a)	 	vested but the applicable Performance Hurdles attaching to that Option have not
been satisfied; or

	 
	 	(b)	 	not vested but the applicable Performance Hurdles attaching to that Option have
been satisfied; or

	 
	 	(c)	 	not vested and the applicable Performance Hurdles attaching to that Option have
not been satisfied,

will automatically lapse on the date on which the Participant (if he or she is an Employee)
or that Participant’s Nominator (if the Participant is not an Employee) ceases to be
employed by any Group Company (other than where a Special Circumstance occurs (in which case
Rule 9.1 will apply)), unless otherwise determined by the Plan Committee.

	9.3A	 	Lapsing of Options on
a Change of Control Event

Each outstanding Option under the Plan, whether or not vested or for which the applicable
Performance Hurdles have been satisfied, shall lapse upon the effective time of a Change of
Control Event, unless the transaction the subject of the Change of Control Event provides
for the continuation or assumption of outstanding Options by the surviving or successor
entity or a parent company of that entity, or for the substitution of equivalent awards, as
determined in the sole discretion of the Board, of the surviving or successor entity or a
parent of that entity. This is subject to the proviso that holders of Options that lapse
under this Rule 9.3 are permitted to exercise all of their Options immediately before the
Change of Control Event.

 

15

 

	9.4	 	Cessation of rights

Subject
to Rule 9.3A, if a Participant fails for any reason to exercise all the Options registered in the
Participant’s name before the occurrence of a circumstance set out in Rules 9.1 to 9.3,
those Options that the Participant:

	 	(a)	 	would have been entitled to exercise and that have not been exercised; or

	 
	 	(b)	 	may have had a right or entitlement to have vested in the Participant,

	 	 	will lapse and all rights of a Participant under the Plan in respect of those Options will cease.

	 
	10	 	Dealings with Options

	 
	10.1	 	Options are personal

Subject to Rule 10.3, Options are personal to the Participant to whom they have been issued
and may not be assigned to, transferred to or exercised by any other person without the
prior written approval of the Plan Committee.

	10.2	 	No unauthorised disposal

Except as permitted under Rule 10.3, a Participant must not dispose of or grant an
Encumbrance over or otherwise deal with an Option or an interest in an Option, and the
Encumbrance or disposal or dealing will not be recognised in any manner by the Company.

	10.3	 	Permitted transfer of Options

Options may be transferred, by an instrument of transfer, only where a Change of Control
Event occurs.

	11	 	Participation rights, rights issues, reorganisations of capital and winding up

	 
	11.1	 	New issues

	 	(a)	 	Participants are not entitled to participate in any new issue to existing
shareholders of
securities in the Company unless:

	 	(i)	 	they have become entitled to exercise their Options under the
Plan; and

	 
	 	(ii)	 	they do so before the record date for the determination of
entitlements to the new issue of securities and participate as a result of
being holders of Shares.

	 	(b)	 	In accordance with the Listing Rules, the Company must give Participants notice
of any new issue of securities before the record date for determining entitlements to the new
issue.

	11.2	 	Dividends, distributions and rights issues

The Company shall make no adjustment for dividends, distributions, or other rights for which
the record date is before the date the Shares are issued.

 

16

 

	11.3	 	Reconstruction of capital

	 
	 	 	If there is any reconstruction (including consolidation (reverse split), sub-division (stock
split), split-up or similar transaction, spin-off, dividend, recapitalization, merger or
share exchange) of the issued capital of the Company (whether before or during the Exercise
Period) (other than as
part of a transaction resulting in a Change of Control Event), then the rights of a
Participant (including the number of Options to which each Participant is entitled, the
Exercise Price, and the type of shares that the Participant will be entitled to or any other
terms) will be changed in a manner determined by the Board to the extent necessary to comply
with the Listing Rules applying to a reconstruction of capital at the time of the
reconstruction.

	 
	11.4	 	Liquidation or Dissolution

	 
	 	 	If (whether before or during the Exercise Period) a resolution for a voluntary liquidation
or dissolution of the Company is proposed to shareholders (other than for the purpose of a
reconstruction) the Plan Committee may, in its absolute discretion, give written notice to
Participants of the proposed resolution. Subject to satisfaction of the Performance Hurdles,
the Participants may, during the period referred to in the notice, exercise their Options if
the Last Exercise Date for the Options has not expired.

	 
	11.5	 	Fractions of Shares

	 
	 	 	For the purposes of this Rule 11, if Options are exercised simultaneously, then the
Participant may aggregate the number of Shares or fractions of Shares for which the
Participant is entitled to subscribe. Fractions in the aggregate number only will be
disregarded in determining the total entitlement of a Participant.

	 
	11.6	 	Cumulative application

	 
	 	 	In applying any provisions of this Rule 11 to adjust a number of Shares the subject of an
Option or the Exercise Price for Shares, account shall be taken of each prior event
requiring adjustment under this Rule 11 so that the effect of successive applications of the
provisions of this Rule 11 is cumulative.

	 
	11.7	 	Calculations and adjustments

	 
	 	 	Any calculations or adjustments which are required to be made under this Rule 11 will be
made by the Plan Committee and, in the absence of manifest error, are final and conclusive
and binding on the Company and the Participant.

	 
	11.8	 	Notice of change

	 
	 	 	The Company must within a reasonable period give to each Participant and each relevant
Nominator notice of any change under Rule 11 to the Exercise Price of any Options held by
the Participant or to the number or type of Shares that the Participant is entitled to
subscribe for on exercise of an Option.

	 
	12	 	No quotation of Options

	 
	 	 	The Company will not seek official quotation of any Options.

 

17

 

	13	 	Administration of the Plan

	 
	13.1	 	Plan Committee’s powers

	 
	 	 	The Plan Committee will administer the Plan and it will have the power to:

	 	(a)	 	determine appropriate procedures and make regulations for the administration of
the Plan, including vesting and any Performance Hurdles, provided they are consistent
with these Rules;

	 
	 	(b)	 	determine finally and conclusively all questions of fact or interpretation
arising in connection with the Plan, including whether any Options have vested and
whether Performance Hurdles have been satisfied;

	 
	 	(c)	 	terminate or suspend the operation of the Plan at any time, subject to any
resolution of the Company required by the Listing Rules, provided that the termination
or suspension does not adversely affect or prejudice the rights of Participants holding
Options at that time;

	 
	 	(d)	 	delegate any functions, powers or discretions it considers appropriate, for the
efficient administration of the Plan, to any person or persons whom the Plan Committee
reasonably believes to be capable of performing those functions and exercising those
powers or discretions;

	 
	 	(e)	 	take and rely upon independent professional or expert advice in or in relation
to the exercise of any of their powers or discretions under these Rules;

	 
	 	(f)	 	administer the Plan in accordance with these Rules as and to the extent
provided in these Rules; and

	 
	 	(g)	 	make any additions, variations or modifications to the Rules, in relation to
the implementation of the Plan and the specific application of the Rules to Employees
residing outside Australia.

	13.2	 	Exercise of powers or discretion

	 
	 	 	Any power or discretion that is conferred on the Plan Committee or Board by these Rules may
be exercised by the Plan Committee or Board in the interests or for the benefit of the
Company. In exercising that power or discretion, neither the Plan Committee nor the Board is
under any fiduciary or other obligations to another person.

	 
	13.3	 	Decisions binding

	 
	 	 	Whenever the Plan Committee exercises a discretion pursuant to the Rules, the exercise of
that discretion shall be in the sole and absolute discretion of the Plan Committee and each
decision shall be conclusive, final and binding upon Participants.

	 
	13.4	 	Expenses and costs

	 
	 	 	Subject to these Rules, the Company must pay all expenses, costs and charges incurred in the
administration of the Plan.

 

18

 

	13.5	 	Tax

	 
	 	 	The Company is not responsible for any Tax which may become payable by a Participant in
connection with the grant of any Option, the issue of Shares pursuant to an exercise of
Options or any other dealing by a Participant with the Options or Shares. At the time an
Option is exercised, in whole or in part, or at any time thereafter as requested by the
Company, the Participant, by having accepted the Option, agrees to make adequate provision
for United States federal, state and local Taxes, or other applicable non-United States
Taxes required by law to be withheld, if any, which arise in connection with the Option.
The Company may require a Participant to make a cash payment to cover any withholding Tax
obligation as a condition of exercise of the Option. If the Participant does not make such
payment when requested, the Company may refuse to issue any Share or share certificate under
the Plan until arrangements satisfactory to the Company for such payment have been made.
The Company may, in its sole discretion, permit a Participant to satisfy, in whole or in
part, any withholding Tax obligation which may arise in connection with an Option either by
electing to have the Company withhold from the Shares to be issued upon exercise that number
of Shares, or by electing to deliver to the Company already-owned Shares, in either case
having a fair market value equal to no more than the amount necessary to satisfy the
statutory minimum withholding amount due.

	 
	14	 	Amendment to Rules

	 
	14.1	 	Board may amend Rules

	 
	 	 	Subject to all Relevant Laws, the Board may at any time amend any of these Rules, or waive
or modify the application of any of these Rules in relation to a Participant or relevant
Nominator.

	 
	14.2	 	Consent of Participants

	 
	 	 	If an amendment to be made under Rule 14.1 would adversely affect the rights of Participants
in respect of any Options then held by them, the Board must obtain the consent of
Participants who between them hold not less than 75% of the total number of those Options
held by all those Participants before making the amendment.

	 
	15	 	Rights of Participants

	 
	15.1	 	No conferred rights

	 
	 	 	These Rules:

	 	(a)	 	do not confer on an Employee the right to receive an Offer;

	 
	 	(b)	 	do not confer on a Participant or Nominator the right to continue as an
employee of any Group Company; and

	 
	 	(c)	 	do not affect any rights that a Group Company may have to terminate the
employment of a Participant or Nominator and may not be used to increase damages in an
action brought against the Group Company in respect of that termination.

 

19

 

	15.2	 	Plan not part of employment contract

	 
	 	 	This Plan does not form part of any contract of employment between any Group Company and an
Employee and does not confer directly or indirectly on an Employee any legal or equitable
right whatsoever (other than rights as a Participant under the Plan or the holder of any
Shares issued pursuant to the exercise of Options issued under the Plan) against any Group
Company.

	 
	15.3	 	Voting at general meetings

	 
	 	 	Participants do not, as Participants, have any right to attend or vote at general meetings
of holders of Shares.

	 
	16	 	Participation in other plans

	 
	 	 	Subject to these Rules, participation in the Plan does not affect, and is not affected by,
participation in any other incentive or other scheme of the Company unless the terms of that
scheme provide otherwise.

	 
	17	 	Advice

	 
	 	 	Employees and any nominees approved under Rule 4.3 should obtain their own independent
advice at their own cost in relation to the financial, taxation and other implications
arising for them as a result of their participation in the Plan.

	 
	18	 	Notices

	 
	 	 	Any notice or direction given under this Plan is validly given if it is handed to the person
concerned or posted by ordinary prepaid post to the person’s last known address. Where a
notice or other communication is given by post, it will be deemed to have been received 48
hours after it was put into the post correctly addressed and stamped.

	 
	19	 	Data protection

	 
	 	 	By participating in the Plan, the Participant and the Nominator, as applicable, consent to
the collection, holding and processing of personal data provided by the Participant and/or
Nominator for all purposes relating to the operation of the Plan.

 

20

 

	20	 	Compliant with securities laws, listing and registration

	 	(a)	 	If at any time the Board determines that the delivery of Shares under the Plan is or may be
unlawful under the laws of any applicable jurisdiction, or United States federal or state
securities laws, or applicable non-United States securities laws, the right to exercise an
Option or receive Shares pursuant to an Option shall be suspended until the Board
determines that such delivery is lawful. If at any time the Board determines that the
delivery of Shares under the Plan is or may violate the rules of the securities exchange on
which the Shares are then listed for trade, the right to exercise an Option or receive
Shares pursuant to an Option shall be suspended until the Board determines that such
delivery would not violate such rules. The Company shall have no obligation to effect any
registration or qualification of the Shares under United States federal or state laws, or
applicable non-United States laws.

	 
	 	(b)	 	The Company may require that a Participant, as a condition to exercise of an Option, and as
a condition to the delivery of any share certificate, make such written representations
(including representations to the effect that such person will not dispose of the Shares so
acquired in violation of United States federal or state securities laws, or applicable
non-United States securities laws) and furnish such information as may, in the opinion of
counsel for the Company, be appropriate to permit the Company to issue the Shares in
compliance with applicable United States federal or state securities laws, or applicable
non-United States securities laws. The stock certificates for any Shares issued pursuant to
this Plan may bear a legend restricting transferability of the Shares unless such Shares
are registered or an exemption from registration is available under the Securities Act of
1933, as amended, and applicable state or applicable non-United States securities laws.

	 
	 	(c)	 	While the Shares are
listed for trading on any securities exchange or market (including,
without limitation, ASX and NASDAQ Stock Market), the Company shall
not make any amendments to this Plan or issue any Awards or take any
other action unless such action complies with the relevant Listing Rules.

 

21

 

APPENDIX
A

PROVISIONS FOR CALIFORNIA RESIDENTS

With respect to Options granted to California residents prior to a public offering of
capital stock of the Company that is effected pursuant to a registration statement
filed with, and declared effective by, the SEC under the Securities Act of 1933, as
amended, and only to the extent required by applicable law, the following provisions
shall apply notwithstanding anything in the Plan, Application Form, or Option
Certificate to the contrary:

	1	 	Terms of Options

	 
	 	 	With respect to any Option granted under the Plan:

	 	(a)	 	The Exercise Period shall be no more than 120 months from the Grant Date.

	 
	 	(b)	 	The Options shall be non-transferable other than by will, by the laws of
descent and distribution, or, if and to the extent permitted under the Plan or
applicable Option Certificate, to a revocable trust or as permitted by Rule 701
of the Securities Act of 1933, as amended.

	 
	 	(c)	 	Unless employment is terminated for “cause” as defined by applicable law,
the terms of the Plan or Option Certificate, or a contract of employment, the
right to exercise the Option in the event of termination of employment, to the
extent that the Option holder is entitled to exercise on the date employment
terminates, will continue until the earlier of the Option expiration date, or:

	 	(i)	 	At least 6 months from the date of termination if
termination was caused by death or disability.

	 
	 	(ii)	 	At least 30 days from the date of termination if
termination was caused by other than death or disability.

	2	 	Plan termination date

	 
	 	 	The Plan shall have a termination date of not more than 10 years from the date the
Plan is adopted by the Board or the date the Plan is approved by the security holders,
whichever is earlier.

	 
	3	 	Shareholder approval

	 
	 	 	Security holders representing a majority of the Company’s outstanding securities
entitled to vote must approve the Plan by the later of (a) 12 months after the date
the Plan is adopted or (b) 12 months after the granting of any Option to a resident of
California. Any Option exercised or any securities purchased before security holder
approval is obtained must be rescinded if security holder approval is not obtained
within the period described in the preceding sentence. Such securities shall not be
counted in determining whether such approval is obtained.

 

A - 1

 

	4	 	Right to repurchase

	 
	 	 	At the discretion of the Plan Committee, the Company may reserve to itself and/or its
assignee(s) in the Option Certificate or any applicable stock restriction agreement a
right to repurchase securities held by an Option holder upon such Option holder’s
termination of employment at any time within six months after such Option holder’s termination date (or in the case of
securities issued upon exercise of an Option after the termination date, within six
months after the date of such exercise) for cash or cancellation of purchase money
indebtedness, at:

	 	(a)	 	no less than the fair market value of such securities as of the date of
the Option holder’s termination of employment, provided, that such right to
repurchase securities terminates when the Company’s securities have become
publicly traded; or

	 
	 	(b)	 	the Option holder’s original purchase price, provided, that such right to
repurchase securities at the original purchase price lapses at the rate of at
least 20% of the securities per year over 5 years from the Grant Date (without
respect to the date the Option was exercised or became exercisable).

	 	 	The securities held by an officer, director, manager or consultant of the Company or
an affiliate may be subject to additional or greater restrictions.

	 
	5	 	Financial statements

	 
	 	 	The Company will provide financial statements to each Option holder annually during
the period such individual has Options outstanding, or as otherwise required under
section 260.140.46 of Title 10 of the California Code of Regulations. Notwithstanding
the foregoing, the Company will not be required to provide such financial statements
to Option holders when the Plan complies with all conditions of Rule 701 of the
Securities Act of 1933, as amended; provided that for purposes of determining such
compliance, any registered domestic partner shall be considered a “family member” as
that term is defined in Rule 701.

	 
	6	 	Compliant with California law

	 
	 	 	The Plan is intended to comply with section 25102(o) of the California Corporations
Code (Section 25102(o)). Any provision of this Plan which is inconsistent with
Section 25102(o), including without limitation any provision of this Plan that is more
restrictive than would be permitted by Section 25102(o) as amended from time to time,
shall, without further act or amendment by the Board, be reformed to comply with the
provisions of Section 25102(o). If at any time the Plan Committee determines that the
delivery of Shares under the Plan is or may be unlawful under the laws of any
applicable jurisdiction, or federal or state securities laws, the right to exercise an
Option or receive Shares pursuant to an Option shall be suspended until the Plan
Committee determines that such delivery is lawful. The Company shall have no
obligation to effect any registration or qualification of the Shares under U.S.
federal or state laws.

 

A - 2

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