Document:

Exhibit 4.1

 Exhibit 4.1 
 DEPOSIT AGREEMENT 
 This DEPOSIT AGREEMENT is made and entered into as of March 27, 2008 by and
among Saul Centers, Inc., a Maryland corporation (the “Company”), Continental Stock Transfer & Trust Company, as Depositary, and all holders from time to time of Receipts (as hereinafter defined) issued hereunder. 
 WITNESSETH: 
 WHEREAS, it is desired
to provide, as hereinafter set forth in this Deposit Agreement, for the deposit of shares of the Company’s Preferred Stock (as hereinafter defined) with the Depositary for the purposes set forth in this Deposit Agreement and for the issuance
hereunder of the Receipts evidencing Depositary Shares representing a fractional interest in the Preferred Stock deposited; and 
 WHEREAS,
the Receipts are to be substantially in the form of Exhibit A annexed to this Deposit Agreement, with appropriate insertions, modifications and omissions, as hereinafter provided in this Deposit Agreement; 
 NOW, THEREFORE, in consideration of the promises contained herein, it is agreed by and among the parties hereto as follows: 
 ARTICLE I 
 DEFINITIONS

 The following definitions shall apply to the respective terms (in the singular and plural forms of such terms) used in this Deposit
Agreement and the Receipts: 
 SECTION 1.01. “AMEX” shall mean the American Stock Exchange or a successor that is a national
securities exchange registered under Section 6 of the Exchange Act. 
 SECTION 1.02. “Articles of Incorporation” shall mean
the Articles of Incorporation, as amended and supplemented from time to time, of the Company. 
 SECTION 1.03. “Articles
Supplementary” shall mean the Articles Supplementary Classifying 34,500 Shares of Preferred Stock as 9% Series B Cumulative Redeemable Preferred Stock filed with the State Department of Assessments and Taxation of the State of Maryland
establishing the Preferred Stock as a series of Preferred Stock of the Company. 
 SECTION 1.04. “Common Stock” shall mean shares
of the Company’s common stock, $.01 par value per share. 
 SECTION 1.05. “Company” shall mean Saul Centers, Inc., a Maryland
corporation, and its successors. 

 SECTION 1.06. “Corporate Office” shall
mean the corporate office of the Depositary at which at any particular time its business in respect of matters governed by this Deposit Agreement shall be administered, which at the date of this Deposit Agreement is located at 17 Battery Place, 8
th Floor, New York, New York. 
 SECTION
1.07. “Deposit Agreement” shall mean this agreement, as the same may be amended, modified or supplemented from time to time. 
 SECTION 1.08. “Depositary” shall mean Continental Stock Transfer & Trust Company, a company or corporation having its principal office in the United States, and any successor as depositary hereunder. 
 SECTION 1.09. “Depositary Share” shall mean a 1/100th fractional interest of a share of Preferred Stock deposited with the Depositary hereunder and the same proportionate interest in any and all other property received by the
Depositary in respect of such share of Preferred Stock and held under this Deposit Agreement, all as evidenced by the Receipts issued hereunder. Subject to the terms of this Deposit Agreement, each owner of a Depositary Share is entitled,
proportionately, to all the rights, preferences and privileges of the Preferred Stock represented by such Depositary Share, including the dividend and distribution, voting, redemption, conversion and liquidation rights as set forth in the Articles
Supplementary. 
 SECTION 1.10. “Depositary’s Agent” shall mean one or more agents appointed by the Depositary as provided,
and for the purposes specified, in Section 7.05 hereof. 
 SECTION 1.11. “Exchange Act” shall mean the Securities Exchange Act
of 1934, as amended. 
 SECTION 1.12. “Existing Holder Limit” shall have the meaning set forth in Article VI, Section 4 of the
Company’s Articles of Incorporation. 
 SECTION 1.13. “NASDAQ” shall mean the NASDAQ Stock Market, Inc. or a successor that is
a national securities exchange registered under Section 6 of the Exchange Act. 
 SECTION 1.14. “NYSE” shall mean the New York
Stock Exchange, Inc. or a successor that is a national securities exchange registered under Section 6 of the Exchange Act. 
 SECTION
1.15. “Ownership Limit” shall have the meaning set forth in Article VI, Section 4 of the Company’s Articles of Incorporation. 
 SECTION 1.16. “Preferred Stock” shall mean shares of the Company’s 9% Series B Cumulative Redeemable Preferred Stock, $.01 par value per share, heretofore validly issued, fully paid and non-assessable. 
 SECTION 1.17. “Receipt” shall mean a Depositary Receipt issued hereunder to evidence one or more Depositary Shares, whether in definitive or
temporary form, substantially in the form set forth as Exhibit A hereto. 
  

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 SECTION 1.18. “record date” shall mean the date fixed pursuant to Section 4.04 hereof.

 SECTION 1.19. “record holder” or “holder” as applied to a Receipt shall mean the person in whose name a Receipt is
registered on the books maintained by the Depositary for such purpose. 
 SECTION 1.20. “redemption date” shall have the meaning
set forth in Section 2.03 hereof. 
 SECTION 1.21. “REIT” shall have the meaning set forth in Section 2.03 hereof.

 SECTION 1.22. “Registrar” shall mean Continental Stock Transfer & Trust Company, or any bank or trust company appointed
to register ownership and transfers of Receipts or the deposited Preferred Stock, as the case may be, as herein provided. 
 SECTION 1.23.
“Securities Act” shall mean the Securities Act of 1933, as amended. 
 SECTION 1.24. “Signature Guarantee” shall have the
meaning set forth in Section 2.04 hereof. 
 SECTION 1.25. “Special Damages” shall have the meaning set forth in
Section 5.08 hereof. 
 SECTION 1.26. “Transfer Agent” shall mean Continental Stock Transfer & Trust Company, or any
bank or trust company appointed to transfer the Receipts or the deposited Preferred Stock, as the case may be, as herein provided. 
 ARTICLE II 
 FORM OF RECEIPTS, DEPOSIT OF PREFERRED STOCK, EXECUTION 
 AND DELIVERY, TRANSFER, SURRENDER AND REDEMPTION OF RECEIPTS 
 SECTION 2.01. Form and Transferability of Receipts. Definitive Receipts shall be engraved or printed or lithographed with steel-engraved borders and underlying tint and shall be substantially in the form set
forth in Exhibit A annexed to this Deposit Agreement, with appropriate insertions, modifications and omissions, as hereinafter provided. Pending the preparation of definitive Receipts, the Depositary, upon the written order of the Company,
delivered in compliance with Section 2.02, shall execute and deliver temporary Receipts which may be printed, lithographed, typewritten, mimeographed or otherwise substantially of the tenor of the definitive Receipts in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other variations as the persons executing such Receipts may determine, as evidenced by their execution of such Receipts. If temporary Receipts are issued, the Company and the
Depositary will cause definitive Receipts to be prepared without unreasonable delay. After the preparation of definitive Receipts, the temporary Receipts shall be exchangeable for definitive Receipts upon surrender of the temporary Receipts at the
Corporate Office or such other offices, if any, as the Depositary may designate, without charge to the holder. Upon surrender for cancellation of any one or more temporary Receipts, the Depositary 

  

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shall execute and deliver in exchange therefor definitive Receipts representing the same number of Depositary Shares as represented by the surrendered
temporary Receipt or Receipts. Such exchange shall be made at the Company’s expense and without any charge therefor. Until so exchanged, the temporary Receipts shall in all respects be entitled to the same benefits under this Deposit Agreement,
and with respect to the Preferred Stock deposited, as definitive Receipts. 
 Receipts shall be executed by the Depositary by the manual or
facsimile signature of a duly authorized signatory of the Depositary, provided that if a Registrar (other than the Depositary) shall have been appointed then such Receipts shall also be countersigned by manual signature of a duly authorized
signatory of the Registrar. No Receipt shall be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose unless it shall have been executed as provided in the preceding sentence. The Depositary shall record on
its books each Receipt executed as provided above and delivered as hereinafter provided. 
 Except as the Depositary may otherwise determine,
Receipts shall be in denominations of any number of whole Depositary Shares. All Receipts shall be dated the date of their issuance. 
 Receipts may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this Deposit Agreement as may be required by the Company or required to comply with any
applicable law or regulation or with the rules and regulations of any securities exchange or interdealer quotation system upon which the Preferred Stock, the Depositary Shares or the Receipts may be listed or quoted or to conform with any usage with
respect thereto, or to indicate any special limitations or restrictions to which any particular Receipts are subject, in each case, as directed by the Company. 
 Title to any Receipt (and to the Depositary Shares evidenced by such Receipt) that is properly endorsed or accompanied by a properly executed instrument of transfer or endorsement shall be transferable by delivery
with the same effect as in the case of a negotiable instrument; provided, however, that until a Receipt shall be transferred on the books of the Depositary as provided in Section 2.04, the Depositary may, notwithstanding any notice to the
contrary, treat the record holder thereof at such time as the absolute owner thereof for the purpose of determining the person entitled to dividends or other distributions, the exercise of any redemption or voting rights or to any notice provided
for in this Deposit Agreement and for all other purposes. 
 SECTION 2.02. Deposit of Preferred Stock; Execution and Delivery of Receipts
in Respect Thereof. Concurrently with the execution of this Deposit Agreement, the Company is delivering to the Depositary a certificate or certificates, registered in the name of the Depository Trust Company, or its designee, and evidencing up
to 34,500 shares of Preferred Stock, properly endorsed or accompanied, if required by the Depositary, by a duly executed instrument of transfer or endorsement, in form satisfactory to the Depositary, together with (i) all such certifications as
may be required by the Depositary in accordance with the provisions of this Deposit Agreement and (ii) a written letter of instruction of the Company directing the Depositary to execute and deliver to, or upon the written order of, the person
or persons stated in such order a Receipt or Receipts for the Depositary Shares representing such deposited Preferred Stock. The Depositary acknowledges receipt of the deposited Preferred Stock and related 

  

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documentation and agrees to hold such deposited Preferred Stock in an account to be established by the Depositary at the Corporate Office or at such other
office as the Depositary shall determine. The Company hereby appoints the Depositary as the Registrar and Transfer Agent for the Preferred Stock deposited hereunder and the Depositary hereby accepts such appointment and, as such, will reflect
changes in the number of shares (including any fractional shares) of deposited Preferred Stock held by it by notation, book-entry or other appropriate method. 
 If required by the Depositary, Preferred Stock presented for deposit by the Company at any time, whether or not the register of stockholders of the Company is closed, shall also be accompanied by an agreement or
assignment, or other instrument satisfactory to the Depositary, that will provide for the prompt transfer to the Depositary or its nominee of any distribution or right to subscribe for additional Preferred Stock or to receive other property that any
person in whose name the Preferred Stock is or has been registered may thereafter receive upon or in respect of such deposited Preferred Stock, or in lieu thereof such agreement of indemnity or other agreement as shall be satisfactory to the
Depositary. 
 Upon receipt by the Depositary of a certificate or certificates for Preferred Stock deposited hereunder, together with the
other documents specified above, and upon registering such Preferred Stock in the name of the Depositary, the Depositary, subject to the terms and conditions of this Deposit Agreement, shall execute and deliver to, or upon the order of, the person
or persons named in the written order delivered to the Depositary referred to in the first paragraph of this Section 2.02 a Receipt or Receipts for the number of whole Depositary Shares representing the Preferred Stock so deposited and
registered in such name or names as may be requested by such person or persons. The Depositary shall execute and deliver such Receipt or Receipts at the Corporate Office, except that, at the request, risk and expense of any person requesting such
delivery, such delivery may be made at such other place as may be designated by such person. 
 Other than in the case of splits,
combinations or other reclassifications affecting the Preferred Stock, or in the case of distributions of Preferred Stock, if any, there shall be deposited hereunder not more than the number of shares constituting the Preferred Stock as set forth in
the Articles Supplementary, as such may be amended. 
 The Company shall deliver to the Depositary from time to time such quantities of
Receipts as the Depositary may request to enable the Depositary to perform its obligations under this Deposit Agreement. 
 SECTION 2.03.
Optional Redemption of Preferred Stock for Cash. Shares of the Preferred Stock are not redeemable prior to March 15, 2013. However, in order to ensure that the Company remains qualified as a real estate investment trust
(“REIT”) for United States federal income tax purposes in accordance with the Articles of Incorporation, the Preferred Stock, together with all other equity securities of the Company, shall be subject to Article VI of the Articles of
Incorporation pursuant to which Preferred Stock owned by a stockholder in excess of the Ownership Limit, or by the Existing Holder in excess of the Existing Holder Limit, shall automatically be transferred to a Trust for the exclusive benefit of a
Beneficiary, as provided in Article VI, Section 5 of the Articles of Incorporation. On or after March 15, 2013, if the 

  

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Company shall elect to redeem shares of deposited Preferred Stock for cash in accordance with the provisions of the Articles Supplementary, it shall (unless
otherwise agreed in writing with the Depositary) give the Depositary not less than 30 nor more than 60 days’ prior written notice of the date of such proposed redemption and of the number of such shares of Preferred Stock held by the Depositary
to be redeemed and the applicable redemption price, as set forth in the Articles Supplementary, including the amount, if any, of accrued and unpaid dividends thereon to and including the date fixed for redemption. The Depositary shall mail,
first-class postage prepaid, notice of the redemption of Preferred Stock and the proposed simultaneous redemption of the Depositary Shares representing the Preferred Stock to be redeemed, not less than 30 nor more than 60 days prior to the date
fixed for redemption of such Preferred Stock and Depositary Shares (the “redemption date”), to the record holders of the Receipts evidencing the Depositary Shares to be so redeemed, at the addresses of such holders as the same appear on
the records of the Depositary. No failure to give such notice or any defect thereto or in the mailing thereof shall affect the sufficiency of notice or validity of the proceedings for redemption except as to a holder to whom notice was defective or
not given. A redemption notice which has been mailed in the manner provided herein shall be conclusively presumed to have been duly given on the date mailed whether or not the holder received the redemption notice. The Company shall provide the
Depositary with such notice, and each such notice shall state: the redemption date; the redemption price and accrued and unpaid dividends payable on the redemption date; the number of shares of deposited Preferred Stock and Depositary Shares to be
redeemed; if fewer than all the Depositary Shares held by any holder are to be redeemed, the number of such Depositary Shares held by such holder to be so redeemed; the place or places where Receipts evidencing the Depositary Shares to be redeemed
are to be surrendered for payment of the redemption price and accrued and unpaid dividends payable on the redemption date; and that from and after the redemption date dividends in respect of the Preferred Stock represented by the Depositary Shares
to be redeemed will cease to accrue. If fewer than all of the outstanding Depositary Shares are to be redeemed, the Depositary Shares to be redeemed shall be redeemed pro rata (as nearly as may be practicable without creating fractional Depositary
Shares) or by any other equitable method determined by the Company that will not result in a violation of the Ownership Limit or the Existing Holder Limit. 
 During any period of time that both (i) Preferred Stock is not listed on the NYSE, AMEX or NASDAQ (or if the Preferred Stock is at any time held in the form of Depositary Shares, the Depositary Shares
representing Preferred Stock are not listed on the NYSE, AMEX or NASDAQ), and (ii) the Company is not subject to the reporting requirements of the Exchange Act, but any shares of Series B Preferred Stock are outstanding, the Corporation will
have the option to redeem the Series B Preferred Stock, in whole but not in part, within 90 days of the date upon which the shares of the Series B Preferred Stock (or the Depositary Shares) cease to be listed and we cease to be subject to such
reporting requirements, for a redemption price of $2,500.00 per share, plus all dividends accrued and unpaid (whether or not declared), if any, to the date such shares are redeemed as provided in Section 5(c) of the Articles Supplementary, upon
the giving of notice as provided in Section 5(h) of the Articles Supplementary. 
 In the event that notice of redemption has been made
as described in this Section 2.03 and the Company shall then have paid or caused to be paid in full to the Depositary the redemption price (determined pursuant to the Articles Supplementary) of the Preferred Stock 

  

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deposited with the Depositary to be redeemed (including any accrued and unpaid dividends to and including the redemption date), the Depositary shall redeem
the number of Depositary Shares representing such Preferred Stock so called for redemption by the Company and from and after the redemption date (unless the Company shall have failed to pay for the shares of Preferred Stock to be redeemed by it as
set forth in the Company’s notice provided for in the preceding paragraph), all dividends in respect of the shares of Preferred Stock called for redemption shall cease to accrue, the Depositary Shares called for redemption shall be deemed no
longer to be outstanding and all rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive the redemption price plus all accrued and unpaid dividends to and including the redemption date) shall, to the extent
of such Depositary Shares, cease and terminate. Upon surrender in accordance with said notice of the Receipts evidencing such Depositary Shares (properly endorsed or assigned for transfer, if the Depositary or applicable law shall so require), such
Depositary Shares shall be redeemed at a redemption price of $25.00 per Depositary Share plus all accrued and unpaid dividends to and including the redemption date. The foregoing shall be further subject to the terms and conditions of the Articles
Supplementary. In the event of any conflict between the provisions of this Deposit Agreement and the provisions of the Articles Supplementary, the provisions of the Articles Supplementary will govern and the Company will instruct the Depositary
accordingly. 
 Unless full cumulative dividends on all Preferred Stock shall have been or contemporaneously are declared and paid in cash or
declared and a sum sufficient for the payment thereof in cash irrevocably set apart for payment for all past dividend periods and the then current dividend period, no Preferred Stock shall be redeemed unless all outstanding shares of Preferred Stock
are simultaneously redeemed and the Company shall not purchase or otherwise acquire directly or indirectly any shares of Preferred Stock or any class or series of equity securities of the Company ranking, as to dividends or upon liquidation, on a
parity with or junior to the Preferred Stock (except by exchange for shares of equity securities of the Company ranking, as to dividends and upon liquidation, junior to the Preferred Stock); provided, however, that the foregoing shall
not prevent the purchase of Preferred Stock by the Company in accordance with the terms of Section 5(a) or 5(e) of the Articles Supplementary or Article VI of the Articles of Incorporation or otherwise in order to ensure that the Company
remains qualified as a REIT for United States federal income tax purposes or the purchase or acquisition of Preferred Stock pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding shares of Preferred Stock.

 If fewer than all of the Depositary Shares evidenced by a Receipt are called for redemption, the Depositary will deliver to the holder of
such Receipt upon its surrender to the Depositary, together with payment of the redemption price for and all other amounts payable in respect of the Depositary Shares called for redemption, a new Receipt evidencing such holder’s Depositary
Shares evidenced by such prior Receipt that are not called for redemption. 
 The Company acknowledges that the bank accounts maintained by
the Depositary in connection with the performance of the services described herein will be in the name of the Depositary and that the Depositary may receive investment earnings in connection with the investment at the Depositary’s risk and for
its benefit of funds held in those accounts from time to time. 
  

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 SECTION 2.04. Registration of Transfers of Receipts. The Company hereby appoints the Depositary as
the Registrar and Transfer Agent for the Receipts and the Depositary hereby accepts such appointment and, as such, shall register on its books from time to time transfers of Receipts upon any surrender thereof by the holder in person or by a duly
authorized attorney, agent or representative, properly endorsed or accompanied by a properly executed instrument of transfer or endorsement and including a guarantee of the signature thereon by a participant in a signature guarantee medallion
program approved by the Securities Transfer Association (a “Signature Guarantee”), together with evidence of the payment of any transfer taxes as may be required by applicable law. Upon such surrender, the Depositary shall execute a new
Receipt or Receipts and deliver the same to or upon the order of the person entitled thereto evidencing the same aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered. 
 SECTION 2.05. Combinations and Split-ups of Receipts. Upon surrender of a Receipt or Receipts at the Corporate Office or such other office as the
Depositary may designate for the purpose of effecting a split-up or combination of Receipts, subject to the terms and conditions of this Deposit Agreement, the Depositary shall execute and deliver a new Receipt or Receipts in the authorized
denominations requested evidencing the same aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered. 
 SECTION 2.06. Surrender of Receipts and Withdrawal of Preferred Stock. Any holder of a Receipt or Receipts may withdraw any or all of the deposited Preferred Stock represented by the Depositary Shares evidenced by such Receipt or
Receipts and all money and other property, if any, represented by such Depositary Shares by surrendering such Receipt or Receipts at the Corporate Office or at such other office as the Depositary may designate for such withdrawals. After such
surrender, without unreasonable delay, the Depositary shall deliver to such holder, or to the person or persons designated by such holder as hereinafter provided, the number of whole or fractional shares of such Preferred Stock and all such money
and other property, if any, represented by the Depositary Shares evidenced by the Receipt or Receipts so surrendered for withdrawal, but holders of such whole or fractional shares of Preferred Stock will not thereafter be entitled to deposit such
Preferred Stock hereunder or to receive Depositary Shares therefor. If the Receipt or Receipts delivered by the holder to the Depositary in connection with such withdrawal shall evidence a number of Depositary Shares in excess of the number of
Depositary Shares representing the number of whole or fractional shares of deposited Preferred Stock to be withdrawn, the Depositary shall at the same time, in addition to such number of whole or fractional shares of Preferred Stock and such money
and other property, if any, to be withdrawn, deliver to such holder, or (subject to Section 2.04) upon his order, a new Receipt or Receipts evidencing such excess number of Depositary Shares. Delivery of such Preferred Stock and such money and
other property being withdrawn may be made by the delivery of such certificates, documents of title and other instruments as the Depositary may deem appropriate, which, if required by the Depositary, shall be properly endorsed or accompanied by a
properly executed instrument of transfer or endorsement. 
 If the deposited Preferred Stock and the money and other property being withdrawn
are to be delivered to a person or persons other than the record holder of the Receipt or Receipts being surrendered for withdrawal of Preferred Stock, such holder shall execute and deliver to the Depositary a written order so directing the
Depositary and the Depositary may require that the 

  

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Receipt or Receipts surrendered by such holder for withdrawal of such shares of Preferred Stock be properly endorsed in blank or accompanied by a properly
executed instrument of transfer or endorsement in blank with a Signature Guarantee. 
 The Depositary shall deliver the deposited Preferred
Stock and the money and other property, if any, represented by the Depositary Shares evidenced by Receipts surrendered for withdrawal at the Corporate Office, except that, at the request, risk and expense of the holder surrendering such Receipt or
Receipts and for the account of the holder thereof, such delivery may be made at such other place as may be designated by such holder. 
 SECTION 2.07. Limitations on Execution and Delivery, Transfer, Split-up, Combination. As a condition precedent to the execution and delivery, transfer, split-up, combination, surrender or exchange of any Receipt, the Depositary, any
of the Depositary’s Agents or the Company may require any or all of the following: (i) payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement
to it) of any tax or other governmental charge with respect thereto (including any such tax or charge with respect to the Preferred Stock being deposited or withdrawn); (ii) the production of proof satisfactory to it as to the identity and
genuineness of any signature (or the authority of any signature), including a Signature Guarantee; and (iii) compliance with such regulations, if any, as the Depositary or the Company may establish consistent with the provisions of this Deposit
Agreement as may be required by any securities exchange upon which the deposited Preferred Stock, the Depositary Shares or the Receipts may be included for quotation or listed. 
 The deposit of Preferred Stock may be refused, the delivery of Receipts against Preferred Stock may be suspended, the transfer of Receipts may be
refused, and the transfer, split-up, combination, surrender, exchange or redemption of outstanding Receipts may be suspended (i) during any period when the register of stockholders of the Company is closed or (ii) if any such action is
deemed reasonably necessary or advisable by the Depositary, any of time Depositary’s Agents or the Company at any time or from time to time because of any requirement of applicable law or of any government or governmental body or commission, or
under any provision of this Deposit Agreement. 
 SECTION 2.08. Lost Receipts, etc. In case any Receipt shall be mutilated or
destroyed or lost or stolen, the Depositary in its discretion may execute and deliver a Receipt of like form and tenor in exchange and substitution for such mutilated Receipt or in lieu of and in substitution for such destroyed, lost or stolen
Receipt, provided that the holder thereof provides the Depositary with (i) evidence reasonably satisfactory to the Depositary of such destruction, loss or theft of such Receipt, of the authenticity thereof and of his ownership thereof and
(ii) reasonable indemnification and the provision of an open penalty surety bond, in each case, satisfactory to the Depositary and the Company and holding the Depositary and the Company harmless. 
 SECTION 2.09. Cancellation and Destruction of Surrendered Receipts. All Receipts surrendered to the Depositary or any Depositary’s Agent
shall be cancelled by the Depositary. Except as prohibited by applicable law or regulation, the Depositary is authorized to destroy such Receipts so cancelled. 
  

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 ARTICLE III 
 CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY 
 SECTION 3.01. Filing Proofs,
Certificates and Other Information. Any person presenting Preferred Stock for deposit or any holder of a Receipt may be required from time to time to file such proof of residence or other information and to execute such certificates as the
Depositary or the Company may reasonably deem necessary or proper. The Depositary or the Company may withhold or delay the delivery of any Receipt, the transfer, redemption or exchange of any Receipt, the withdrawal of the deposited Preferred Stock
represented by the Depositary Shares evidenced by any Receipt, the distribution of any distribution or the sale of any rights or of the proceeds thereof, until such proof or other information is filed or such certificates are executed. 

SECTION 3.02. Payment of Fees and Expenses. Holders of Receipts shall be obligated to make payments to the Depositary of certain fees and
expenses, as provided in Section 5.09, or provide evidence reasonably satisfactory to the Depositary that such fees and expenses have been paid. Until such payment is made, transfer of any Receipt or any withdrawal of the Preferred Stock or
money or other property, if any, represented by the Depositary Shares evidenced by such Receipt may be refused, any distribution may be withheld, and any part or all of the Preferred Stock or other property represented by the Depositary Shares
evidenced by such Receipt may be sold for the account of the holder thereof (after attempting by reasonable means to notify such holder a reasonable number of days prior to such sale). Any distribution so withheld and the proceeds of any such sale
may be applied to any payment of such fees or expenses, the holder of such Receipt remaining liable for any deficiency. 
 SECTION 3.03.
Representations and Warranties as to Preferred Stock. In the case of the initial deposit of the Preferred Stock hereunder, the Company and, in the case of subsequent deposits thereof, each person so depositing Preferred Stock under this
Deposit Agreement, shall be deemed thereby to represent and warrant that such Preferred Stock and each certificate therefor are valid and that the person making such deposit is duly authorized to do so. The Company hereby further represents and
warrants that such Preferred Stock, when issued, will be validly issued, fully paid and non-assessable. Such representations and warranties shall survive the deposit of the Preferred Stock and the issuance of Receipts. 
 SECTION 3.04. Representation and Warranty as to Receipts and Depositary Shares. The Company hereby represents and warrants that the Receipts, when
issued, will evidence legal and valid interests in the Depositary Shares and each Depositary Share will represent a legal and valid fractional interest in a share of deposited Preferred Stock represented by such Depositary Share. Such representation
and warranty shall survive the deposit of the Preferred Stock and the issuance of Receipts evidencing the Depositary Shares. 
  

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 ARTICLE IV 
 THE PREFERRED STOCK; NOTICES 
 SECTION 4.01. Dividends and Other Cash Distributions. Whenever
the Depositary shall receive any dividend or other cash distributions on the deposited Preferred Stock, including any cash received upon redemption of any shares of Preferred Stock pursuant to Section 2.03, the Depositary shall, subject to
Section 3.02, distribute to record holders of Receipts on the record date fixed pursuant to Section 4.04 such amounts of such sum as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by
the Receipts held by such holders; provided, however, that, in case the Company or the Depositary shall be required by law to withhold and shall withhold from any cash distribution in respect of the Preferred Stock an amount on account of taxes or
as otherwise required by law, regulation or court process, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly. The Depositary shall distribute or make available for distribution, as
the case may be, only such amount, however, as can be distributed without attributing to any holder of Receipts a fraction of one cent, and any balance not so distributable shall be held by the Depositary (without liability for interest thereon) and
shall be added to and be treated as part of the next sum received by the Depositary for distribution to record holders of Receipts then outstanding. 
 SECTION 4.02. Distributions Other Than Cash. Whenever the Depositary shall receive any distribution other than cash on the deposited Preferred Stock, the Depositary shall, subject to Section 3.02,
distribute to record holders of Receipts on the record date fixed pursuant to Section 4.04 such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares
evidenced by the Receipts held by such holders, in any manner that the Depositary and the Company may deem equitable and practicable for accomplishing such distribution. If in the opinion of the Depositary after consultation with the Company, such
distribution cannot be made proportionately among such record holders, or if for any other reason (including any requirement that the Company or the Depositary withhold an amount on account of taxes), the Depositary deems, after consultation with
the Company, such distribution not to be feasible, the Depositary may, with the approval of the Company, adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including the sale (at public or private
sale) of the securities or property thus received, or any part thereof at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Section 3.02, be distributed or made available for
distribution, as the case may be, by the Depositary to record holders of Receipts as provided by Section 4.01 in the case of a distribution received in cash. The Company shall not make any distribution of such securities or property to the
holders of Receipts unless the Company shall have provided to the Depositary an opinion of counsel stating that such securities or property have been registered under the Securities Act or do not need to be registered in order to be freely
transferable. 
 SECTION 4.03. Subscription Rights, Preferences or Privileges. If the Company shall at any time offer or cause to be
offered to the persons in whose names deposited Preferred Stock is registered on the books of the Company any rights, preferences or privileges to subscribe for or 

  

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to purchase any securities or any rights, preferences or privileges of any other nature, the offering of such rights, preferences or privileges shall in each
such instance be communicated to the Depositary and thereafter made available by the Depositary to the record holders of Receipts in such manner as the Company shall instruct (including by the issue to such record holders of warrants representing
such rights, preferences or privileges); provided, however, that (a) if at the time of issue or offer of any such rights, preferences or privileges the Company determines upon advice of its legal counsel that it is not lawful or feasible to
make such rights, preferences or privileges available to the holders of Receipts (by the issue of warrants or otherwise) or (b) if and to the extent instructed by holders of Receipts who do not desire to exercise such rights, preferences or
privileges, the Depositary shall then, if so instructed by the Company, and if applicable laws or the terms of such rights, preferences or privileges so permit, sell such rights, preferences or privileges of such holders at public or private sale,
at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Section 3.01 and Section 3.02, be distributed by the Depositary to the record holders of Receipts entitled thereto as
provided by Section 4.01 in the case of a distribution received in cash. The Company shall not make any distribution of such rights, preferences or privileges, unless the Company shall have provided to the Depositary an opinion of counsel
stating that such rights, preferences or privileges have been registered under the Securities Act or do not need to be registered in order to be freely transferable. 
 If registration under the Securities Act of the securities to which any rights, preferences or privileges relate is required in order for holders of Receipts to be offered or sold the securities to which such rights,
preferences or privileges relate, the Company agrees that it will promptly file a registration statement pursuant to the Securities Act with respect to such rights, preferences or privileges and securities and use its reasonable best efforts and
take all steps available to it to cause such registration statement to become effective sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. In
no event shall the Depositary make available to the holders of Receipts any right, preference or privilege to subscribe for or to purchase any securities unless and until such a registration statement shall have become effective or unless the
offering and sale of such securities to such holders are exempt from registration under the provisions of the Securities Act and the Company shall have provided to the Depositary an opinion of counsel to such effect. 
 If any other action under the law of any jurisdiction or any governmental or administrative authorization, consent or permit is required in order for
such rights, preferences or privileges to be made available to holders of Receipts, the Company agrees to use its reasonable best efforts to take such action or obtain such authorization, consent or permit sufficiently in advance of the expiration
of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. 
 SECTION 4.04.
Notice of Distributions; Fixing of Record Date for Holders of Receipts. Whenever any dividend or other cash distributions shall become payable, any distribution other than cash shall be made, or any rights, preferences or privileges shall at
any time be offered, with respect to the deposited Preferred Stock, or whenever the Depositary shall receive notice of (i) any meeting at which holders of such Preferred Stock are entitled to vote or of which holders of such Preferred Stock are
entitled to notice or (ii) any election on the part of the Company to 

  

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redeem any shares of such Preferred Stock, the Depositary shall in each such instance fix a record date (which shall be the same date as the record date, if
any, fixed by the Company with respect to the Preferred Stock) for the determination of the holders of Receipts (a) who shall be entitled to receive such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale
thereof, (b) who shall be entitled to give instructions for the exercise of voting rights at any such meeting or to receive notice of such meeting or (c) whose Depositary Shares are to be so redeemed. 
 SECTION 4.05. Voting Rights. Upon receipt of notice of any meeting at which the holders of
deposited Preferred Stock are entitled to vote, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Receipts a notice, which shall be provided by the Company and which shall contain (i) such information as is
contained in such notice of meeting, (ii) a statement that the holders of Receipts at the close of business on a specified record date fixed pursuant to Section 4.04 will be entitled, subject to any applicable provision of law, to instruct
the Depositary as to the exercise of the voting rights pertaining to the amount of Preferred Stock represented by their respective Depositary Shares and (iii) a brief statement as to the manner in which such instructions may be given. Upon the
written request of a holder of a Receipt on such record date, the Depositary shall vote or cause to be voted the amount of Preferred Stock represented by the Depositary Shares evidenced by such Receipt in accordance with the instructions set forth
in such request. To the extent any such instructions request the voting of a fractional interest of a share of deposited Preferred Stock, the Depositary shall aggregate such interest with all other fractional interests resulting from requests with
the same voting instructions and shall vote the number of whole votes resulting from such aggregation in accordance with the instructions received in such requests. Each share of Preferred Stock is entitled to one vote and, accordingly, each
Depositary Share is entitled to 1/100th of a vote. The Company hereby agrees to take all reasonable action that may be deemed necessary by the
Depositary in order to enable the Depositary to vote such Preferred Stock or cause such Preferred Stock to be voted. In the absence of specific instructions from the holder of a Receipt, the Depositary will abstain from voting to the extent of the
Preferred Stock represented by the Depositary Shares evidenced by such Receipt. The Depositary shall not be required to exercise discretion in voting any Preferred Stock represented by the Depositary Shares evidenced by such Receipt. 
 SECTION 4.06. Changes Affecting Preferred Stock and Reclassifications, Recapitalizations, etc. Upon any change in par or stated value, split-up,
combination or any other reclassification of Preferred Stock, or upon any recapitalization, reorganization, merger, amalgamation or consolidation affecting the Company or to which it is a party or sale of all or substantially all of the
Company’s assets, the Depositary shall, upon the instructions of the Company, (i) make such adjustments in (a) the fraction of an interest represented by one Depositary Share in one share of Preferred Stock and (b) the ratio of
the redemption price per Depositary Share to the redemption price of a share of Preferred Stock, in each case as may be required by or as is consistent with the provisions of the Articles Supplementary to fully reflect the effects of such change in
liquidation preference, split-up, combination or other reclassification of stock, or of such recapitalization, reorganization, merger, amalgamation, consolidation or sale and (ii) treat any shares of stock or other securities or property
(including cash) that shall be received by the Depositary in exchange for or upon conversion of or in respect 

  

 13 

 
of the Preferred Stock as new deposited property under this Deposit Agreement, and Receipts then outstanding shall thenceforth represent the proportionate
interests of holders thereof in the new deposited property so received in exchange for or upon conversion of or in respect of such Preferred Stock. In any such case the Depositary may, in its discretion, with the approval of the Company, execute and
deliver additional Receipts, or may call for the surrender of all outstanding Receipts to be exchanged for new Receipts specifically describing such new deposited property. Anything to the contrary herein notwithstanding, holders of Receipts shall
have the right from and after the effective date of any such change in par or stated value, split-up, combination or other reclassification of the Preferred Stock or any such recapitalization, reorganization, merger, amalgamation or consolidation or
sale of substantially all the assets of the Company to surrender such Receipts to the Depositary with instructions to convert, exchange or surrender the Preferred Stock represented thereby only into or for, as the case may be, the kind and amount of
shares of stock and other securities and property and cash into which the deposited Preferred Stock evidenced by such Receipts might have been converted or for which such Preferred Stock might have been exchanged or surrendered immediately prior to
the effective date of such transaction, subject to any subsequent change in par or stated value, split-up, combination or other reclassification or any subsequent recapitalization, reorganization, merger, amalgamation or consolidation or sale of
substantially all the assets. The Company shall cause effective provision to be made in the charter of the resulting or surviving corporation (if other than the Company) for protection of such rights as may be applicable upon exchange of the
deposited Preferred Stock for securities or property or cash of the surviving corporation in connection with the transactions set forth above. The Company shall cause any such surviving corporation (if other than the Company) expressly to assume the
obligations of the Company hereunder. 
 SECTION 4.07. Inspection of Reports. The Depositary shall make available for inspection by
holders of Receipts at the Corporate Office and at such other places as it may from time to time deem advisable during normal business hours any reports and communications received from the Company that are both received by the Depositary as the
holder of deposited Preferred Stock and made generally available to the holders of the Preferred Stock. In addition, the Depositary shall transmit certain notices and reports to the holders of Receipts as provided in Section 5.05. 

SECTION 4.08. Lists of Receipt Holders. Promptly upon request from time to time by the Company, the Depositary shall furnish to the Company a
list, as of a recent date specified by the Company, of the names, addresses and holdings of Depositary Shares of all persons in whose names Receipts are registered on the books of the Depositary. 
 SECTION 4.09. Tax and Regulatory Compliance. The Depositary shall be responsible for (i) preparing and mailing of IRS Forms 1099, 1042 and
1042-S for all open and closed accounts, (ii) all applicable withholding related to payments made with respect to the Receipts, including, without limitation, withholding required pursuant to Sections 1441, 1442, 1445 and 3406 of the Internal
Revenue Code of 1986, as amended, (iii) mailing Form W-99, or W8-BEN, as appropriate, to new holders of Receipts without a certified taxpayer identification number or to non-US investors, (iv) processing certified Forms W-99 and W8-BEN,
(v) preparing and filing of state information returns and (vi) providing escheatment services. 
  

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 SECTION 4.10. Withholding. Notwithstanding any other provision of this Deposit Agreement to the
contrary, in the event that the Depositary determines that any distribution in property is subject to any tax which the Depositary is obligated by applicable law to withhold, the Depositary may dispose of all or a portion of such property in such
amounts and in such manner as the Depositary deems necessary and practicable to pay such taxes, by public or private sale, and the Depositary shall distribute the net proceeds of any such sale or the balance of any such property after deduction of
such taxes to the holders of Receipts entitled thereto in proportion to the number of Depositary Shares held by them, respectively; provided, however, that in the event the Depositary determines that such distribution of property is subject to
withholding tax only with respect to some but not all holders of Receipts, the Depositary will use its best efforts (i) to sell only that portion of such property distributable to such holders that is required to generate sufficient proceeds to
pay such withholding tax and (ii) to effect any such sale in such a manner so as to avoid affecting the rights of any other holders of Receipts to receive such distribution in property. 
 ARTICLE V 
 THE DEPOSITARY AND THE COMPANY 
 SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books by the Depositary and the Registrar. The Depositary shall maintain at the
Corporate Office facilities for the execution and delivery, transfer, surrender and exchange, split-up, combination and redemption of Receipts and deposit and withdrawal of Preferred Stock and at the offices of the Depositary’s Agents, if any,
facilities for the delivery, transfer, surrender and exchange, split-up, combination and redemption of Receipts and deposit and withdrawal of Preferred Stock, all in accordance with the provisions of this Deposit Agreement. 
 The Depositary shall keep books at the Corporate Office for the registration and transfer of Receipts, which books at all reasonable times shall be open
for inspection by the record holders of Receipts as provided by applicable law. The Depositary may close such books, at any time or from time to time, when deemed expedient by it in connection with the performance of its duties hereunder. The
Depositary may maintain such books in customary electronic form. 
 If the Receipts or the Depositary Shares evidenced thereby or the
Preferred Stock represented by such Depositary Shares shall be listed on the New York Stock Exchange, Inc. or any other stock exchange, or quoted on any interdealer quotation system, the Depositary may, with the approval of the Company, appoint a
Registrar (acceptable to the Company) for registration of such Receipts or Depositary Shares in accordance with the requirements of such stock exchange or quotation system. Such Registrar (which may be the Depositary if so permitted by the
requirements of such Exchange) may be removed and a substitute registrar appointed by the Depositary upon the request or with the approval of the Company. If the Receipts, such Depositary Shares or such Preferred Stock are listed on one or more
other stock exchanges or quotation systems, the Depositary will, at the request and expense of the Company, arrange such facilities for the delivery, transfer, surrender, redemption and exchange of such Receipts, such Depositary Shares or such
Preferred Stock as maybe required by applicable law or applicable stock exchange or quotation system regulations. 
  

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 SECTION 5.02. Prevention or Delay in Performance by the Depositary, the Depositary’s Agents, the
Registrar or the Company. None of the Depositary, any Depositary’s Agent, any Registrar or the Company shall incur any liability to any holder of any Receipt, if by reason of any provision of any present or future law or regulation
thereunder of the United States of America or of any other governmental authority or, in the case of the Depositary, the Depositary’s Agent or the Registrar, by reason of any provision, present or future, of the Articles of Incorporation or the
Articles Supplementary or, in the case of the Company, the Depositary, the Depositary’s Agent or the Registrar, by reason of any act of God or war or other circumstance beyond the control of the relevant party, the Depositary, any
Depositary’s Agent, the Registrar or the Company shall be prevented or forbidden from doing or performing any act or thing that the terms of this Deposit Agreement provide shall be done or performed; nor shall the Depositary, any
Depositary’s Agent, any Registrar or the Company incur any liability to any holder of a Receipt by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing that the terms of this Deposit Agreement
provide shall or may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement. 
 SECTION 5.03. Obligations of the Depositary, the Depositary’s Agents, the Registrar and the Company. Each of the Depositary, any Depositary’s Agent and any Registrar shall at all times act in good
faith and shall use its best efforts within reasonable time limits to insure the accuracy of all services performed pursuant to this Agreement. None of the Depositary, any Depositary’s Agent, any Registrar or the Company assumes any obligation
or shall be subject to any liability under this Deposit Agreement or any Receipt to holders of Receipts other than from acts or omissions arising out of conduct constituting bad faith, gross negligence or willful misconduct in the performance of
such duties as are specifically set forth in this Deposit Agreement. 
 None of the Depositary, any Depositary’s Agent, any Registrar or
the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding with respect to the deposited Preferred Stock, Depositary Shares or Receipts that in its reasonable opinion may involve it in expense or
liability, unless indemnity reasonably satisfactory to it against all expense and liability be furnished as often as may be required. 
 None
of the Depositary, any Depositary’s Agent, any Registrar or the Company shall be liable for any action or any failure to act by it in reliance upon the written advice of legal counsel or accountants, or information provided by any person
presenting Preferred Stock for deposit, any holder of a Receipt or any other person believed by it in good faith to be competent to give such advice or information. The Depositary, any Depositary’s Agent, any Registrar and the Company may each
rely and shall each be protected in acting upon any written notice, request, direction or other document believed by it in good faith to be genuine and to have been signed or presented by the proper party or panics. 
 In the event the Depositary shall receive conflicting claims, requests or instructions from any holders of Receipts, on the one hand, and the Company, on
the other hand, the Depositary shall be entitled to act on such claims, requests or instructions received from the Company, and shall be entitled to the full indemnification set forth in Section 5.06 hereof in connection with any action so
taken. 
  

 16 

 The Depositary shall not be responsible for any failure to carry out any instruction to vote any of the
deposited Preferred Stock or for the manner or effect of any such vote made, as long as any such action or non-action is in good faith and does not result from negligence or willful misconduct of the Depositary. The Depositary undertakes, and any
Registrar shall be required to undertake, to perform such duties and only such duties as are specifically set forth in this Deposit Agreement, and no implied covenants or obligations shall be read into this Agreement against the Depositary or any
Registrar. 
 The Depositary, its parent, affiliate, or subsidiaries, any Depositary’s Agent, and any Registrar may own, buy, sell or
deal in any class of securities of the Company and its affiliates and in Receipts or Depositary Shares or become pecuniarily interested in any transaction in which the Company or its affiliates may be interested or contract with or lend money to or
otherwise act as fully or as freely as if it were not the Depositary or the Depositary’s Agent hereunder. The Depositary may also act as transfer agent or registrar of any of the securities of the Company and its affiliates or act in any other
capacity for the Company or its affiliates. 
 It is intended that neither the Depositary nor any Depositary’s Agent shall be deemed to
be an “issuer” of the securities under the federal securities laws or applicable state securities laws, it being expressly understood and agreed that the Depositary and any Depositary’s Agent are acting only in a ministerial capacity
as Depositary for the deposited Preferred Stock; provided, however, that the Depositary agrees to comply with all information reporting and withholding requirements applicable to it under law or this Deposit Agreement in its capacity as Depositary.

 Neither the Depositary (or its officers, directors, employees or agents) nor any Depositary’s Agent makes any representation or has
any responsibility as to the validity of the registration statement pursuant to which the Depositary Shares are registered under the Securities Act, the deposited Preferred Stock, the Depositary Shares, the Receipts (except its countersignature
thereon) or any instruments referred to therein or herein, or as to the correctness of any statement made therein or herein; provided, however, that the Depositary is responsible for its representations in this Deposit Agreement and for the validity
of any action taken or required to be taken by the Depositary in connection with this Deposit Agreement. 
 The Company represents that it
has registered the deposited Preferred Stock and the Depositary Shares for sale in accordance with applicable securities laws. 
 SECTION
5.04. Resignation and Removal of the Depositary; Appointment of Successor Depositary. The Depositary may at any time resign as Depositary hereunder by delivering to the Company notice of its election to do so, such resignation to take effect
upon the appointment of a successor depositary and its acceptance of such appointment as hereinafter provided. 
  

 17 

 The Depositary may at any time be removed by the Company by notice of such removal delivered to the
Depositary, such removal to take effect upon the appointment of a successor depositary and its acceptance of such appointment as hereinafter provided. 
 In case at any time the Depositary acting hereunder shall resign or be removed, the Company shall, within 60 days after the delivery of the notice of resignation or removal, as the case may be, appoint a successor
depositary, which shall be a bank or trust company having its principal office in the United States of America and having a combined capital and surplus of at least $50,000,000. If a successor depositary shall not have been appointed in 60 days, the
resigning Depositary may petition a court of competent jurisdiction to appoint a successor depositary. Every successor depositary shall execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment
hereunder, and thereupon such successor depositary, without any further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor and for all purposes shall be the Depositary under this Deposit
Agreement, and such predecessor, upon payment of all sums due it and on the written request of the Company, shall promptly execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder, shall
duly assign, transfer and deliver all rights, title and interest in the deposited Preferred Stock and any moneys or property held hereunder to such successor and shall deliver to such successor a list of the record holders of all outstanding
Receipts. Any successor depositary shall promptly mail notice of its appointment to the record holders of Receipts. 
 Any corporation into
or with which the Depositary may be merged, consolidated or converted shall be the successor of such Depositary without the execution or filing of any document or any further act. Such successor depositary may execute the Receipts either in the name
of the predecessor depositary or in the name of the successor depositary. 
 SECTION 5.05. Notices, Reports and Documents. The Company
agrees that it will deliver to the Depositary, and the Depositary will, promptly after receipt thereof transmit to the record holders of Receipts, in each case at the address recorded in the Depositary’s books, copies of all notices and reports
(including financial statements) required by law, by the rules of any national securities exchange or interdealer quotation system upon which the Preferred Stock, the Depositary Shares or the Receipts are listed or quoted or by the Articles of
Incorporation and the Articles Supplementary to be furnished by the Company to holders of the deposited Preferred Stock and, if requested by the holder of any Receipt, a copy of this Deposit Agreement, the form of Receipt, the Articles Supplementary
and the form of Preferred Stock. Such transmission will be at the Company’s expense and the Company will provide the Depositary with such number of copies of such documents as the Depositary may reasonably request. In addition, the Depositary
will transmit to the record holders of Receipts at the Company’s expense such other documents as may be requested by the Company. 
 SECTION 5.06. Indemnification by the Company. The Company agrees to indemnify the Depositary, any Depositary’s Agent and any Registrar against, and hold each of them harmless from, any liability, costs and expenses (including
reasonable attorneys’ fees) that may arise out of, or in connection with, its acting as Depositary, Depositary’s Agent or Registrar, respectively, under this Deposit Agreement and the Receipts, except for any liability arising out 

  

 18 

 
of the willful misconduct, gross negligence, or bad faith on the part of any such person or persons. The obligations of the Company set forth in this
Section 5.06 shall survive any succession of any Depositary, Registrar or Depositary’s Agent or termination of this Deposit Agreement. 
 SECTION 5.07. Indemnification by the Depositary. The Depositary agrees to indemnify the Company against, and hold the Company harmless from, any liability, costs and expenses (including reasonable attorneys’ fees) that may arise
out of, or in connection with, the refusal or failure of any of the Depositary, any Depositary’s Agent or the Registrar to comply with the terms of this Deposit Agreement, or which arise out of the willful misconduct, gross negligence, or bad
faith on the part of any such person or persons; provided, however, that the Depositary’s aggregate liability hereunder with respect to, arising from, or arising in connection with this Deposit Agreement, or from all services provided or
omitted to be provided under this Deposit Agreement, whether in contract, or in tort, or otherwise, is limited to, and shall not exceed, the amounts paid hereunder by the Company to the Depositary as fees and charges under this Agreement or
otherwise, but not including reimbursable expenses, during the six (6) calendar months immediately preceding the event for which recovery from the Depositary is being sought. The obligations of the Depositary set forth in this Section 5.07
shall survive any succession of the Company or termination of this Deposit Agreement. 
 SECTION 5.08. Damages. The Depositary shall
not be liable for any incidental, indirect, special or consequential damages of any nature whatsoever, including, but not limited to, loss of anticipated profits (collectively, “Special Damages”), occasioned by breach of any provision of
this Agreement by the Depositary even if apprised of the possibility of such damages. The Company shall not be liable to the Depositary for Special Damages occasioned by breach of any provision of this Agreement by the Company even if apprised of
the possibility of such damages. 
 SECTION 5.09. Fees, Charges and Expenses. No charges and expenses of the Depositary or any
Depositary’s Agent hereunder shall be payable by any person, except as provided in this Section 5.09. The Company shall pay all transfer and other taxes and governmental charges arising solely from the existence of this Deposit Agreement.
The Company shall also pay all fees and expenses of the Depositary in connection with the initial deposit of the Preferred Stock and the initial issuance of the Depositary Shares evidenced by the Receipts, any redemption of the Preferred Stock at
the option of the Company and all withdrawals of the Preferred Stock by holders of Receipts. If a holder of Receipts requests the Depositary to perform duties not required under this Deposit Agreement, the Depositary shall notify the holder of the
cost of the performance of such duties prior to the performance thereof. Upon approval of such cost by such holder, such holder will thereafter be liable for the charges and expenses related to such performance. All other fees and expenses of the
Depositary and any Depositary’s Agent hereunder and of any Registrar (including, in each case, fees and expenses of counsel) incident to the performance of their respective obligations hereunder will be promptly paid by the Company pursuant to
such terms as the Company and the Depositary shall agree in good faith. The Depositary shall present its statement for fees and expenses to the Company every month or at such other intervals as the Company and the Depositary may agree. 

 

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 ARTICLE VI 
 AMENDMENT AND TERMINATION 
 SECTION 6.01. Amendment. The form of the Receipts and any
provision of this Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect that they may deem necessary or desirable; provided, however, that no such amendment (other than
any change in the fees of any Depositary, Registrar or Transfer Agent that are payable by the Company) which (i) shall materially and adversely alter the rights of the holders of Receipts or (ii) would be materially and adversely
inconsistent with the rights granted to the holders of the Preferred Stock pursuant to the Articles Supplementary shall be effective unless such amendment shall have been approved by the holders of Receipts evidencing at least 66-2/3% of the
Depositary Shares then outstanding. In no event shall any amendment impair the right, subject to the provisions of Section 2.06 and Section 2.07 and Article III, of any holder of any Depositary Shares to surrender the Receipt evidencing
such Depositary Shares with instructions to the Depositary to deliver to the holder the deposited Preferred Stock and all money and other property if any, represented thereby, except in order to comply with mandatory provisions of applicable law.
Every holder of an outstanding Receipt at the time any such amendment becomes effective shall be deemed, by continuing to hold such Receipt, to consent and agree to such amendment and to be bound by this Deposit Agreement as amended thereby.

 SECTION 6.02. Termination. This Deposit Agreement may be terminated by the Company upon not less than 30 days’ prior written
notice to the Depositary if (i) such termination is necessary to preserve the Company’s status as a real estate investment trust under the Internal Revenue Code of 1986, as amended (or any successor provision), or (ii) the holders of
Receipts evidencing at least a majority of the Depositary Shares then outstanding consent to such termination, whereupon the Depositary shall deliver or make available to each holder of a Receipt, upon surrender of the Receipt held by such holder,
such number of whole or fractional shares of deposited Preferred Stock as are represented by the Depositary Shares evidenced by such Depositary Receipt, together with any other property held by the Depositary in respect of such Receipt. In the event
that this Deposit Agreement is terminated pursuant to clause (i) of the immediately preceding sentence, the Company hereby agrees to use its reasonable best efforts to list or quote the Preferred Stock issued upon surrender of the Receipt
evidencing the Depositary Shares represented thereby on a national securities exchange or interdealer quotation system. This Deposit Agreement will automatically terminate if (i) all outstanding Depositary Shares shall have been redeemed
pursuant to Section 2.03 or (ii) there shall have been made a final distribution in respect of the deposited Preferred Stock in connection with any liquidation, dissolution or winding up of the Company and such distribution shall have been
distributed to the holders of Receipts entitled thereto. 
 Upon the termination of this Deposit Agreement, (i) the Company shall be
discharged from all obligations under this Deposit Agreement except for its obligations to the Depositary, any Depositary’s Agent and any Registrar under Section 5.06 and Section 5.09 and (ii) the Depositary shall be discharged
from all obligations under this Deposit Agreement except for its obligations to the Company under Section 5.07. 
  

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 ARTICLE VII 
 MISCELLANEOUS 
 SECTION 7.01. Counterparts. This Deposit Agreement may be executed in any
number of counterparts, and by each of the parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed an original, but all such counterparts taken together shall constitute one and the same
instrument. Delivery of an executed counterpart of a signature page to this Deposit Agreement by telecopier shall be effective as delivery of a manually executed counterpart of this Deposit Agreement. Copies of this Deposit Agreement shall be filed
with the Depositary and the Depositary’s Agents and shall be open to inspection during business hours at the Corporate Office and the respective offices of time Depositary’s Agents, if any, by any holder of a Receipt. 
 SECTION 7.02. Exclusive Benefits of Parties. This Deposit Agreement is for the exclusive benefit of the parties hereto, and their respective
successors hereunder, and shall not be deemed to give any legal or equitable right, remedy or claim to any other person whatsoever. 
 SECTION 7.03. Invalidity of Provisions. In case any one or more of the provisions contained in this Deposit Agreement or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby. 
 SECTION 7.04. Notices. Any and all notices to be given to the Company hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or
facsimile transmission confirmed by letter, addressed to the Company at: 
 Saul Centers, Inc. 
 7501 Wisconsin Avenue, Suite 1500 
 Bethesda,
Maryland 20814 
 Attention: Corporate Secretary 
 Telephone No.: (301) 986-6200 
 or at any other address of which the Company shall have notified the Depositary in
writing. 
 Any notices to be given to the Depositary hereunder or under the Receipts shall be in writing and shall be deemed to have been
duly given if personally delivered or suit by mail, or by telegram or telex or telecopier confirmed by letter, addressed to the Depositary at the Corporate Office to the attention of the General Counsel. 
 Any notices given to any record holder of a Receipt hereunder shall be in writing and shall be deemed to have been duly given if personally delivered or
sent by mail, or by telegram or telex or telecopier confirmed by letter, addressed to such record holder at the address of such record holder as it appears on the books of the Depositary or, if such holder shall have filed with the Depositary in a
timely manner a written request that notices intended for such holder be mailed to some other address, at the address designated in such request. 
  

 21 

 Delivery of a notice sent by mail, or by telegram or telex or telecopier shall be deemed to be effected
at the time when a duly addressed letter containing the same (or a confirmation thereof in the case of a telegram or telex or telecopier message) is deposited, postage prepaid, in a post office letter box. The Depositary or the Company may, however,
act upon any telegram or telex or telecopier message received by it from the other or from any holder of a Receipt, notwithstanding that such telegram or telex or telecopier message shall not subsequently be confirmed by letter as aforesaid.

 SECTION 7.05. Depositary’s Agents. The Depositary may from time to time appoint Depositary’s Agents to act in any respect
for the Depositary for the purposes of this Deposit Agreement and may at any time appoint additional Depositary’s Agents and vary or terminate the appointment of such Depositary’s Agents. The Depositary will notify the Company of any such
action. 
 SECTION 7.06. Holders of Receipts Are Parties. The holders of Receipts from time to time shall be deemed to be parties to
this Deposit Agreement and shall be bound by all of the terms and conditions hereof and of the Receipts by acceptance of delivery thereof. 
 SECTION 7.07. Governing Law. This Deposit Agreement and the Receipts and all rights hereunder and thereunder and provisions hereof and thereof shall be governed by, and construed in accordance with, the law of the State of Maryland
applicable to agreements made and to be performed in said State. 
 SECTION 7.08. Inspection of Deposit Agreement and Articles
Supplementary. Copies of this Deposit Agreement and the Articles Supplementary shall be filed with the Depositary and the Depositary’s Agents and shall be open to inspection during business hours at the Corporate Office and the respective
offices of the Depositary’s Agents, if any, by any holder of any Receipt. 
 SECTION 7.09. Headings. The headings of articles and
sections in this Deposit Agreement and in the form of the Receipt set forth in Exhibit A hereto have been inserted for convenience only and are not to be regarded as a part of this Deposit Agreement or to have any bearing upon the meaning or
interpretation of any provision contained herein or in the Receipts. 
 [SIGNATURE PAGE FOLLOWS] 
  

 22 

 IN WITNESS WHEREOF, Saul Centers, Inc. and Continental Stock Transfer & Trust Company have
caused this Deposit Agreement to be duly executed on their behalf as of the date set forth above and all holders of Receipts shall become parties hereto by and upon acceptance by them of delivery of Receipts issued in accordance with the terms
hereof. 
  

			
	SAUL CENTERS, INC.
		
	By:	 	 /s/ Scott V. Schneider

	Name:	 	Scott V. Schneider
	Title:	 	Senior Vice President, Chief Financial Officer, Treasurer and Secretary
	
	CONTINENTAL STOCK TRANSFER & TRUST COMPANY
		
	By:	 	 /s/ John W. Comer, Jr.

	Name:	 	John W. Comer, Jr.
	Title:	 	Vice President

  
  

 Signature Page 
 Deposit Agreement 

 EXHIBIT A 
 Form of Receipt 
 DEPOSITARY RECEIPT FOR DEPOSITARY SHARES EACH REPRESENTING 
 ONE ONE-HUNDREDTH OF A 
 SHARE OF 9%
SERIES B CUMULATIVE REDEEMABLE PREFERRED STOCK 
 OF 
 SAUL CENTERS, INC. 
 INCORPORATED UNDER THE LAWS OF THE STATE OF MARYLAND 
 DEPOSITARY SHARES 
 THIS CERTIFICATE IS TRANSFERABLE 
 IN NEW YORK, NY 
 SEE REVERSE FOR CERTAIN DEFINITIONS 
 CUSIP 804395 40 8 
 Continental Stock Transfer & Trust Company , as Depositary (the “Depositary”), hereby certifies that              is the registered owner of
             Depositary Shares (“Depositary Shares”), each Depositary Share representing  1/100
th of one share of 9% Series B Cumulative Redeemable Preferred Stock (the “Stock”), of Saul
Centers, Inc., a Maryland corporation (the “Corporation”), on deposit with the Depositary, subject to the terms and entitled to the benefits of the Deposit Agreement, dated as of March 27, 2008 (the “Deposit Agreement”),
among the Corporation, the Depositary and all holders from time to time of Depositary Receipts. By accepting this Depositary Receipt, the holder hereof becomes a party to and agrees to be bound by all the terms and conditions of the Deposit
Agreement. This Depositary Receipt shall not be valid or obligatory for any purpose or be entitled to any benefits under the Deposit Agreement unless it shall have been executed by the Depositary by the manual and or facsimile signature of a duly
authorized officer. 
  

 A-1 

 The Corporation is authorized to issue Common Stock and one or more series of Preferred Stock. The
Corporation will furnish without charge to each receipt holder, who so requests in writing to the Secretary of the Corporation at its principal office or to the transfer agent, a copy of the Deposit Agreement. Any such request shall be made to the
Corporation at the principal office of the Corporation at 7501 Wisconsin Avenue, Suite 1500, Bethesda, Maryland 20814, Attention: Secretary. 
 Dated:

  

	
	  

	 Secretary

	
	  

	 President

	
	 [SEAL]

	
	 COUNTERSIGNED AND REGISTERED

	
	CONTINENTAL STOCK TRANSFER & TRUST COMPANY, TRANSFER AGENT AND REGISTRAR
	
	 By:

	
	  

	 AUTHORIZED OFFICER

  

 A-2 

 SAUL CENTERS, INC. 
 The securities represented by this certificate are subject to restrictions on transfer for the purpose of maintenance of the Corporation’s status as a real estate investment trust (“REIT”) under the
Internal Revenue Code of 1986, as amended (the “Code”). Except as otherwise provided pursuant to the Charter of the Corporation, no Person may (i) Beneficially or Constructively Own shares of Equity Stock in excess of 2.5 percent (or
such greater percentage as may be determined by the Board of Directors of the Corporation) of the Value of the outstanding shares of Equity Stock of the Corporation (except in such circumstances as the Existing Holder Limit shall apply) or
(ii) Beneficially Own Equity Stock which would result in the Corporation being “closely held” under Section 856(h) of the Code or otherwise would cause the Corporation to fail to qualify as a REIT. Any Person who attempts or
proposes to Beneficially or Constructively Own shares of Equity Stock in excess of the above limitations must notify the Corporation in writing at least fifteen (15) days prior to the proposed or attempted transfer. If the transfer restrictions
referred to herein are violated, the shares of Equity Stock represented hereby automatically will be held in trust by the Corporation, all as provided in the Charter of the Corporation. All capitalized terms in this legend have the meanings
identified in the Corporation’s Charter, as the same may be amended or restated from time to time, a copy of which, including the restrictions on transfer, will be sent without charge to each stockholder who so requests. 
 The Corporation will furnish to any stockholder upon request and without charge a full statement of the information required by Section 2-211(b) of
the Maryland General Corporation Law with respect to the designations and any preferences, conversion and other rights, voting powers, restrictions, limitations as to distributions, qualifications and terms and conditions of redemption of the stock
of each class which the Corporation has authority to issue and, if the Corporation is authorized to issue any preferred or special class in series or classes, (i) the difference in the relative rights and preferences between the shares of each
series and class to the extent set, and (ii) the authority of the Board of Directors to set such rights and preferences of subsequent series and classes. The foregoing summary does not purport to be complete and is subject to and qualified in
its entirety by reference to the Charter of the Corporation, a copy of which will be sent without charge to each stockholder who so requests. Such request must be made to the Secretary of the Corporation at its principal office. 
 The following abbreviations, when used in the inscription on the face of this Depositary Receipt shall be construed as though they were written out in
full according to applicable laws or regulations: 
 TEN COM as tenants in common 
 TEN ENT as tenants by the entireties 
 JT TEN as joint tenants with right of survivorship and not as tenants in common

  

							
	UNIF GIFT MIN ACT—	 	  
	 	Custodian	 	  

		 	(Cust)	 		 	(Minor)

  

 A-3 

					
		 	UNDER Uniform Gifts to Minors
			
		 	  
	 	
		 	(State)	 	
			
	UNIF GIFT MIN ACT—	 	  
	 	Custodian (until age
                                  )
		 	(Cust)	 	
			
		 	  
	 	under Uniform Transfers
		 	(Minor)	 	
			
		 	  
	 	to Minors Act
		 	(State)	 	

 Additional abbreviations may also be used though not in the above list. 
 For Value Received,
                         hereby sell, assign and transfer unto 
  
  
  
  
 PLEASE INSERT SOCIAL SECURITY OR OTHER 
 IDENTIFYING NUMBER OF ASSIGNEE 
  
  
  
  
 (Please print or typewrite name and address
including postal zip code of assignee) 
  
  
  
  
 Depositary Shares represented by the within Depositary Receipt, and do hereby 
 irrevocably
constitute and appoint 
  
  
 Attorney to transfer the said Depositary Shares on the books of the within named 
 Depositary with full power of substitution 
  

									
	 Dated
	 	  
	 		 	Signed	 	  

 NOTICE: THE SIGNATURE FOR THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THIS
DEPOSITARY RECEIPT IN EVERY PARTICULAR, WITHOUT ALTERNATION OR ENLARGEMENT OR ANY CHANGE WHATEVER. 
  

 A-4 

 Signature(s) Guaranteed: 
  
 THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15. 
  
  
  

 A-5Employment Agreement, by and between the Registrant and Roger Miller

 Exhibit 10.7 
 EMPLOYMENT AGREEMENT made and entered into as of the 10th day of August, 2006. 
  

			
	BY AND BETWEEN:	  	 TARGANTA THERAPEUTICS CORPORATION, a corporation formed under the laws of the State of Delaware which will have its principal place of
business in Indianapolis, Indiana.
  
 (hereinafter referred to as the
“Corporation”)
  
 PARTY OF THE FIRST PART

		
	AND:	  	 ROGER D. MILLER, domiciled and residing at 1272 W. Stone Ridge Ct., Greenwood, IN 46143 USA
  
 (hereinafter referred to as the “Executive”)
  
 PARTY OF THE SECOND PART

 WHEREAS the Corporation wishes to retain the services of the Executive to act as its Vice President of
Operations and Manufacturing; 
 WHEREAS the Executive wishes to provide his services to the Corporation in such a capacity; 
 WHEREAS the Corporation and the Executive wish to end the previous Employment Agreement signed on January 20, 2006, in favor of this present Employment
Agreement; 
 NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the covenants and agreements herein contained, the parties hereby
covenant and agree with each other as follows: 
 ARTICLE I 
  

	1.	START DATE; PART-TIME EMPLOYMENT 

  

	 	1.1	This Agreement become effective on August 10, 2006, the start date. This Agreement will continue until terminated pursuant to Article VII. 

  

	 	1.2	The Executive shall not work less than 40 hours per week. 

  

	 	1.3	The Corporation shall employ the Executive full time. 

  

	 	1.4	The Executive shall perform his duties principally at the Corporation’s facilities in Indianapolis, Indiana. 

 ARTICLE II 
  

	2.	DUTIES 

  

	 	2.1	The Executive shall serve the Corporation in such capacity or capacities and shall perform such duties and exercise such powers pertaining to the management and operation of the
Corporation as may be determined from time to time by the Chief Executive Officer of the Corporation. 

  

	 	2.2	Without limiting the foregoing, the Executive shall serve as Vice President of Operations and Manufacturing and shall be accountable for contracts with manufacturing partners of
Targanta, the manufacturing assets and inventory of the corporation, interacting with other functional groups, design and implementation of internal systems and serve as an active member with the strategy and success teams. 

 

	 	2.3	The Executive shall diligently and faithfully perform all duties assigned to him to the best of his ability, and act at all times in the best interests of the Corporation. The
Executive shall at all times use his best efforts to promote the interests and goodwill of the Corporation. 

 ARTICLE III

  

	3.	REPORTING PROCEDURES 

 The Executive shall report to the Chief
Executive Officer. The Executive shall report fully on the management, operations and business affairs of the Corporation under his supervision and for which he is accountable, and advise to the best of his ability and in accordance with reasonable
business standards on all matters that may arise from time to time during the term of his employment by the Corporation. 
 ARTICLE IV 

  

	4.	REMUNERATION 

  

	 	4.1	Salary 

  

	 	4.1.1	The annual salary payable to the Executive for his services hereunder shall be one hundred and sixty-five thousand dollars ($165,000) (the “Salary”) for the first
year of this contract and subsequently $220,000 thereafter. 

  

	 	4.1.2	The Salary shall be reviewed at the end of each calendar year to determine whether increase thereof is appropriate in light of the Executive’s achievements and the
Corporation’s performance in the immediately preceding year, but after the first year, the annual salary will be no less than $220,000. 

	 	4.1.3	The Salary shall, be paid to the Executive bi-weekly in arrears, or in such other manner as may be mutually agreed upon, less, in either case, any deductions and withholdings.

  

	 	4.2	Vacation 

 The Executive shall be entitled to three
(3) weeks’ paid vacation each year during the Term hereof. In addition, the Executive shall be entitled to all paid holidays given by the Corporation to its employees generally, including, in any case, the days between December 25 and
January 1 of the following year. 
  

	 	4.3	Stock Options 

 Promptly following the Effective Date, the Executive
will be entitled to receive options to purchase 129,900 shares of the common stock of the Corporation in accordance with the Corporation’s 2005 Stock Option Plan, which is incorporated herein by reference. The exercise price for the Optioned
Shares shall be equal to their current fair market value, which the parties hereby acknowledge is Twenty-Four Cents ($0.24 US) per Optioned Share. The options shall vest and become exercisable according to the following schedule: 
  

	 	(a)	32,475 of the options will vest upon confirmation by the U.S. Food and Drug Administration (“FDA”) that the Active Product Ingredient manufactured by Abbott Contract
Manufacturing and already in inventory meets FDA approval; 

  

	 	(b)	32,475 of the options will vest upon FDA confirmation that the finished product manufactured by Cardinal Health or a manufacturer of the Executive’s choice meets FDA approval
and can be used in clinical studies with normal volunteers and patients; 

  

	 	(c)	32,475 of the options will vest upon the submission of the first Oritavancin New Drug Application to the FDA; and 

  

	 	(d)	32,475 of the options will vest upon the FDA’s approval of the first Oritavancin New Drug Application. 

 The Executive may also be entitled to receive further options to acquire shares of the common stock of the Corporation should the Board of Directors of the Corporation
determine, in its sole and absolute discretion, that their issuance is appropriate. 

 ARTICLE V 
  

	5.	GENERAL EXPENSES 

 The Executive shall be reimbursed for all
reasonable and direct travel and other out-of-pocket expenses actually and properly incurred by the Executive from time to time in connection with carrying out his duties hereunder. For all such expenses the Executive shall furnish to the
Corporation originals of all invoices, statements, and receipts in respect of which the Executive seeks reimbursement. 
 ARTICLE VI 

  

	6.	BENEFITS 

 As a full time employee, the Executive shall be eligible
for a life insurance benefit equal to twice the full annual salary, including the first year of this contract, for which the life insurance benefit will be calculated at four-hundred and forty thousand dollar ($440,000). In addition to this benefit
the Executive shall be eligible for benefits required by law, such as worker’s compensation insurance and unemployment insurance. 
 ARTICLE VII 
  

	7.	TERMINATION 

  

	 	7.1	Termination For Cause 

 The Corporation may terminate this Agreement
for Cause (as hereinafter defined) at any time, either with or without notice. If the Agreement is terminated for Cause, the Executive shall be entitled to no compensation beyond payment of his Salary (and per diem payments, if applicable) through
the date of termination. For the purposes of this Agreement, “Cause” shall mean: 
  

	 	7.1.1	The Executive’s willful failure substantially to perform his duties and responsibilities to the Corporation or his deliberate violation of a Corporation policy;

  

	 	7.1.2	The commission by the Executive of any act of fraud, embezzlement, dishonesty or any other willful misconduct that has caused, or is reasonably expected to result in, material
injury to the Corporation; 

  

	 	7.1.3	The unauthorized use or disclosure by the Executive of any proprietary information or trade secrets of the Corporation or any other party to whom the Executive owes an obligation of
nondisclosure as a result of his relationship with the Corporation; or 

  

	 	7.1.4	The willful breach by the Executive of any of his obligations under any written agreement or covenant with the Corporation after receiving written notification from the Chief
Executive Officer and being given ten business days to cure any such failure or breach. 

	 	7.2	Termination Without Cause 

 The Corporation may terminate this
Agreement at any time without Cause, either with or without notice. If this Agreement is terminated without Cause, the Executive shall be entitled to receive his Salary (and per diem payments, if applicable) through the date of termination. In
addition, the Executive will receive his regular Salary for one (1) month following the date of termination, provided he signs a general release of claims in form and substance acceptable to the Corporation. 
  

	 	7.3	Termination Upon Disability 

 This Agreement may be immediately
terminated by the Corporation if the Executive becomes permanently disabled. The Executive shall be deemed to have become permanently disabled if, because of illness or physical or mental disability; the Executive has been continuously unable or has
failed to perform his duties for a total of sixty (60) days, consecutive or not, within any six-month period. If this Agreement is terminated due to the Executive’s disability, the Executive shall be entitled to no compensation beyond
payment of his Salary (and per diem payments, if applicable) through the date of termination. 
  

	 	7.4	Termination Upon Death 

 This Agreement shall terminate without
notice upon the death of the Executive. If this Agreement is terminated due to the death of the Executive, he and his estate shall be entitled to no compensation beyond payment of his Salary (and per diem payments, if applicable) through the date of
termination. 
  

	 	7.5	Termination By Executive 

 Should the Executive wish to voluntarily
terminate his employment hereunder, he may do so upon not less than thirty (30) days’ prior written notice to the Corporation. At any time after the Executive provides such notice, the Corporation shall be free, in its sole discretion, to
terminate the employment of the Executive immediately so long as it continues to pay the Executive his Salary for the balance of the 30-day notice period. 
 ARTICLE VIII 
  

	8.	NON-COMPETITION, NON-SOLICITATION, NON-DISCLOSURE AND OWNERSHIP OF INVENTIONS 

 The Executive agrees to execute and abide by the terms of the Agreement re: Non-Competition, Non-Solicitation, Non-Disclosure and Ownership of Inventions in favor of the Corporation, a copy of which is attached hereto
as Schedule A and incorporated herein by reference, and the terms of which shall survive the termination of this Agreement. 

 ARTICLE IX 
  

	9.	LEGAL ADVICE 

 The Executive hereby represents and warrants to the
Corporation and acknowledges and agrees that he had the opportunity to seek and was not prevented nor discouraged by the Corporation from seeking independent legal advice prior to the execution and delivery of this Agreement and that, in the event
he did not avail himself of that opportunity prior to signing this Agreement, he did so voluntarily without any undue pressure and agrees that his failure to obtain independent legal advice shall not be used by him as a defense to the enforcement of
his obligations under this Agreement. 
 ARTICLE X 
  

	10.	NOTICES 

 Any notice or other communication required or permitted to
be given hereunder shall be in writing and either delivered by hand, by e-mail with receipt notification, by fax, by prepaid registered mail with return receipt requested, or by a nationally recognized overnight courier service. A notice shall be
deemed given on the date faxed or e-mailed; on the next business day if delivered by overnight courier service; or on the date received if sent by prepaid registered mail with return receipt requested. Notice shall be addressed as follows:

  

	 	10.1    	to the Corporation:     Targanta Therapeutics Corp. 

 225 South East Street, Suite 390 
 Indianapolis, IN 
 462-2-4002 USA 
 Attention: President and CEO 
  

	 	10.2    	to the Executive:         Mr. Roger D. Miller 

 1272 W. Stone Ridge Ct 
 Greenwood, IN 46143 
 or at such other address as any of the parties may have previously indicated in writing in conformity
with the foregoing notice procedure. 
 ARTICLE XI 
  

	11.	MISCELLANEOUS 

  

	 	11.1	Governing Law. This Agreement shall be construed in accordance with and governed by the law of the State of Indiana, without reference to its conflict-of laws provisions. Any
dispute arising from or concerning this Agreement shall be decided in a state or federal court located in Indianapolis, Indiana. 

	 	11.2  	Headings. The headings in this Agreement are for convenience only and shall not in any way limit or be deemed to construe or interpret the terms and provisions of this
Agreement. 

  

	 	11.3  	Preamble and Schedules. The preamble and the Schedules attached to this Agreement shall form an integral part hereof. 

  

	 	11.4  	Severability. If any provision of this Agreement is restricted, prohibited, or held unenforceable, such restriction, prohibition, or unenforceability shall not invalidate or
limit any other provision hereof. If any one or more of the provisions contained in this Agreement or any attachment incorporated herein by reference shall for any reason be held to be excessively broad as to duration, geographical scope, activity,
or subject, such provision shall be construed by limiting and reducing it so as to be enforceable to the maximum extent permitted by law. 

  

	 	11.5  	Waiver. The failure of either party at any time to require the performance by the other party of any provision hereof shall in no way affect the full right to require such
performance at any time thereafter. Nor shall a waiver by either party of a breach of any provision be taken or held to be a waiver of any succeeding breach of such provision or as a waiver of the provision itself. The rights and recourses of the
parties under this Agreement are cumulative and not alternative. 

  

	 	11.6  	Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, except that the
rights and obligations of the Executive hereunder are personal and may not be assigned without the Corporation’s prior written consent. Nothing herein, express or implied, is intended to confer upon any person, other than the parties hereto and
their respective successors and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement. Any assignment of this Agreement by the Corporation shall not be considered a termination of the
Executive’s employment. 

  

	 	11.7  	Counterparts. This Agreement may be executed in two counterparts, each of which shall be deemed to be an original, but both of which together shall constitute one and the
same instrument. 

  

	 	11.8  	Facsimiles. A copy of this Agreement executed by any party and transmitted by facsimile shall be binding upon the parties in the same manner as an original executed and
delivered in person, 

  

	 	11.9  	Declaration. The parties declare and expressly acknowledge that the provisions of this Agreement have been freely negotiated between them. 

  

	 	11.10  	Amendments. This Agreement may be modified or amended only in a writing signed by the Executive and the Chief Executive Officer of the Corporation. 

 

	 	11.11  	Entire Agreement. This Agreement and the schedules attached hereto constitute the entire agreement between the parties and supersede all prior agreements, representations,
warranties, statements, promises, information, arrangements and understandings between them, whether oral or written, express or implied. 

 IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the date first mentioned above.

  

					
	TARGANTA THERAPEUTICS CORPORATION	 		 	
			
	/s/ Pierre Etienne	 		 	/s/ Roger D. Miller
	Name: Pierre Etienne	 		 	Roger D. Miller
	Title: President and CEO

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