Document:

Exhibit 10.3

	
	

	
	

	
	

	
	

	
	

	
	

	
	

	
	

	
	

	
	

Between Zealand Pharma A/S
Smedeland 36
DK-2600 Glostrup
Denmark

and Marino Garcia
 SVP, Corporate & Business Development
40 East 21 Street, Apt6
10010 NY, NY
(the "Warrant Holder")

STRICTLY CONFIDENTIAL - LEGAL PRIVILEGE
AGREEMENT ON WARRANTS
 

	
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TABLE OF CONTENTS
1 PURPOSE .............................................................................................................................. 3
2 GRANT OF WARRANTS ........................................................................................................... 3
3 ORDINARY EXERCISE OF THE WARRANTS .............................................................................. 3
4 EXTRAORDINARY EXERCISE OF THE WARRANTS ..................................................................... 4
5 PRACTICALITIES IN CONNECTION WITH EXERCISE OF THE WARRANTS ................................... 5
6 SUBSCRIPTION PRICE FOR SHARES IN CONNECTION WITH THE EXERCISE OF WARRANTS ....... 5
7 BUY BACK OF WARRANTS - CASH SETTLEMENT ...................................................................... 5
8 ADJUSTMENT  OF  THE  CONDITIONS  FOR  WARRANTS  IN  CASE  OF  CERTAIN CHANGES  IN  THE
COMPANY'S CAPITAL STRUCTURE .......................................................................................... 6
9 TRANSFERABILITY ................................................................................................................. 9
10 CONDITIONS FOR NEW SHARES ISSUED FOLLOWING EXERCISE OF THE WARRANTS ............... 9
11 CAPITAL INCREASE IN CONNECTION WITH THE EXERCISE OF THE WARRANTS ...................... 10
12 COSTS RELATED TO THE ISSUE OF SHARES ......................................................................... 10
13 CESSATION OF EMPLOYMENT STATUS.................................................................................. 10
14 INSIDER TRADING ............................................................................................................... 10
15 TAX IMPLICATIONS ............................................................................................................. 11
16 GOVERNING LAW AND VENUE .............................................................................................. 11 

	
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This Agreement on Warrants (the "Agreement") is entered into on 13 June 2019 between:

(1) Zealand Pharma A/S, (CVR no.: 20 04 50 78) Smedeland 36, DK 2600 Glostrup, Denmark (the
"Company") and
(2) the Warrant Holder

- the Company and the Warrant Holder hereinafter collectively referred to as the "Parties" and separately
as a "Party"

1 PURPOSE
1.1 By entering into this Agreement the Warrant Holder is offered an opportunity to receive warrants
in  the  Company  in  order  to  ensure  that  the  Company  and  the  Warrant  Holder  share  common
interests and that everyone is working to ensure that the value of the Company develops in the
best possible way. The resolution to issue warrants adopted by the Board of Directors of the Com-
pany is available at the Company's offices for inspection.
1.2 It is a condition for the grant of warrants as set out in this Agreement that the Warrant Holder is
employed with the Company or a subsidiary of the Company (the "Employer") and not under notice
at the date of this Agreement.
1.3 The Company's Articles of Association are available at the Company's office for inspection. Amend-
ments to  the Company's Articles of Association shall automatically be accepted by the Warrant
Holder to the extent that the conditions for the resolution to amend the Articles of Association exist.
2 GRANT OF WARRANTS
2.1 The Warrant Holder has been granted 25,976 warrants in the Company (the "Warrants"). Each
Warrant entitles the Warrant Holder to subscribe for one share of nominally DKK 1 in accordance
with the terms set forth in this Agreement and the Company's Articles of Association.
2.2 The Warrants are granted free of charge.
2.3 Each Warrant entitles the Warrant Holder to subscribe for 1 share of nominal value DKK 1.00 in
the Company pursuant to the relevant conditions as set forth in Clauses 3 - 5 and at the relevant
subscription price as determined in Clause 6.
2.4 In connection with the Company's register of shareholders, a register of all issued Warrants shall
be kept.
2.5 Warrants shall vest annually with 1/3 on 13 June 2020, 1/3 on 13 June 2021 and 1/3 on 13 June
2022. The date on which Warrants vest is referred to as the "Vesting Date".
3 ORDINARY EXERCISE OF THE WARRANTS
3.1 Vested Warrants (see Clause 2.5) may be exercised in the period from the respective Vesting Date
and until (and including) 13 June 2024 ("Exercise Period") within the windows set forth in Clause
3.2. Warrants which have not been exercised on or before the last day of the Exercise Period will
automatically lapse and become void without any further notice and/or compensation to the War-
rant Holder.
3.2 Within  the  Exercise  Period,  the  Warrants  may  be  exercised  four  times  a  year  during  a  4-week
window starting from the time of publication of either the Company's annual report or quarterly or
semi-annual reports (respectively 3, 6 and 9 months). 

	
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3.3 The Warrant Holder is entitled to exercise all or part of the Warrants, however, the Warrant Holder
cannot exercise less than 25 per cent of the total number of Warrants granted in accordance with
this Agreement at a time.
4 EXTRAORDINARY EXERCISE OF THE WARRANTS
4.1 In addition to the ordinary exercise of Warrants as set out in Clause 3 the Board of Directors of the
Company may, at their sole discretion, decide that Warrants may be extraordinarily exercised in-
cluding, but not limited to, in accordance with Clauses 4.1.1 - 4.1.6:
4.1.1 In the event that the Company's general meeting passes a resolution to liquidate the Company,
and the Board of Directors (at their sole discretion) decide that Warrants therefore may be exer-
cised, the Company shall notify the Warrant Holder in writing to this effect. Following this notifica-
tion, the Warrant Holder shall notify the Company in writing within two weeks as from the date of
the posting  of this notification from the  Company whether he wishes  to  exercise the Warrants
wholly or partly. If the Warrant Holder does not wish to exercise the Warrants, the Warrants shall
automatically become void without compensation, following the expiry of the time-limit, provided
that the Company is finally liquidated as a result of the notified resolution. Exercise of the Warrants
must be in accordance with Clauses 5 and 6.
4.1.2 In the event that the general meeting passes a resolution to merge the Company and such merger
results in the Company being discontinued, and the Board of Directors (in their sole discretion)
decide that Warrants therefore may be exercised, the Company shall notify the Warrant Holder in
writing to this effect. Following such notification, the Warrant Holder shall notify the Company in
writing within two weeks as from the date of the posting of this notification from the Company
whether he wishes to exercise the Warrants wholly or partly. The notice must in such case be
processed by the Company so that the shares are registered in the Warrant Holder's depot at least
five trading days before the last day of trading of the Company's shares. If the Warrant Holder
does  not  wish  to  exercise  the  Warrants,  the  Warrants  shall  automatically  become  void  without
compensation, following the expiry of the time-limit, provided that the Company is finally discon-
tinued as a result of the notified resolution. Exercise of the Warrants must be in accordance with
Clauses 5 and 6.
4.1.3 In the event that a voluntary or mandatory public offer pursuant to Sections 44 - 47  of the Danish
Act on Capital Markets is made, and the Board of Directors (at their sole discretion) decide that
Warrants therefore may be exercised, the Company shall notify the Warrant Holder in writing to
this  effect.  Following  such  notification,  the  Warrant  Holder  shall  notify  the  Company  in  writing
within two weeks as from the date of the posting of this notification from the Company whether
he wishes to exercise the Warrants wholly or partly. If the Warrant Holder does not wish to exercise
the Warrants, the Warrants and this Agreement will remain in full effect. Any exercise of the War-
rants must be in accordance with Clauses 5 and 6.
4.1.3.1 Following completion of a voluntary or mandatory public offer pursuant to Sections44 - 47 of the
Danish Act on Capital Markets, the Board of Directors shall decide that Warrants may be exercised
within a 4 weeks period. The Company shall notify the Warrant Holder in writing to this effect.
Following  such  notification,  the  Warrant  Holder  shall  notify  the  Company  in  writing  within  two
weeks as from the date of the posting of this notification from the Company whether he wishes to
exercise the Warrants wholly or partly. If the Warrant Holder does not wish to exercise the War-
rants, the Warrants and this Agreement will lapse. Any exercise of the Warrants must be in accord-
ance with Clauses 5 and 6.
4.1.4 In the event of a compulsory acquisition of the Company's shares pursuant to the Danish Compa-
nies  Act  is  initiated,  and  the  Board  of  Directors  (at  their  sole  discretion)  decide  that  Warrants
therefore may be exercised, the Company shall notify the Warrant Holder in writing to this effect.
Following  such  notification,  the  Warrant  Holder shall  notify  the  Company  in  writing  within  two
weeks as from the date of the posting of this notification from the Company whether he wishes to
exercise the Warrants wholly or partly. If the Warrant Holder does not wish to exercise the War-

	
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rants, the Warrants shall automatically become void without compensation, following the comple-
tion of the compulsory acquisition of the Company's shares pursuant to the Danish Companies Act.
Exercise of the Warrants must be in accordance with Clauses 5 and 6.
4.1.5 In the event that the Company's general meeting passes a resolution to delist the Company from
NASDAQ Copenhagen A/S, and the Board of Directors (at their sole discretion) decide that Warrants
therefore may be exercised, the Company shall notify the Warrant Holder in writing to this effect.
Following  such  notification,  the  Warrant  Holder  shall  notify  the  Company  in  writing  within  two
weeks as from the date of the posting of this notification from the Company whether he wishes to
exercise the Warrants wholly or partly. The notice must be processed by the Company so that the
shares are registered in the Warrant Holder's depot at least five trading days before the last day of
trading of the Company's shares. In so far as the Warrant Holder does not wish to exercise the
Warrants, the Warrants shall automatically become void without compensation, following the com-
pletion  of  the  delisting  of  the  Company.  Exercise  of  the  Warrants  must  be  in  accordance  with
Clauses 5 and 6.
4.1.5.1 Following  completion, a delisting  of the Company from NASDAQ  Copenhagen A/S the Board of
Directors shall decide that Warrants may be exercised two times a year within (the remaining part
of) the Exercise Period. Any exercise of the Warrants must be in accordance with Clauses 5 and 6.
4.1.6 In the event that the Company decides to sell the most profitable and material assets of the Com-
pany, and the Board of Directors (at their sole discretion) decide that Warrants therefore may be
exercised, the Company shall notify the Warrant Holder in writing to this effect. Following such
notification, the Warrant Holder shall notify the Company in writing within two weeks as from the
date of the posting of this notification from the Company whether he wishes to exercise the War-
rants wholly or partly. In so far as the Warrant Holder does not wish to exercise the Warrants, the
Warrants and this Agreement will remain in full effect. Any exercise of the Warrants must be in
accordance with Clauses 5 and 6.
5 PRACTICALITIES IN CONNECTION WITH EXERCISE OF THE WARRANTS
5.1 In the event that the Warrant Holder wishes to exercise Warrants, the Warrant Holder shall elec-
tronically give notice to the Company by using the shareholder portal available on the Company's
intranet. The Company is entitled to change the practicalities in connection with exercise of the
Warrants and if so decided by the Company. The Warrant Holder will be notified in writing by the
Company.
5.2 At the same time as giving notice of the exercise of the Warrants, the Warrant Holder shall pay in
cash to the Company an amount equal to the relevant subscription amount fixed under the terms
of Clause 6.
6 SUBSCRIPTION PRICE FOR SHARES IN CONNECTION WITH THE EXERCISE OF WAR-
RANTS
6.1 Each Warrant entitles the Warrant Holder to subscribe for 1 share in the Company of a nominal
value of DKK 1.00 at a subscription price of DKK 138.60 (the "Subscription Price").
6.2 The Subscription Price may be regulated as set out in this Agreement.
7 BUY BACK OF WARRANTS - CASH SETTLEMENT
7.1 Notwithstanding anything set out in this Agreement, in the event that the Warrant Holder gives
notice that the Warrant Holder wishes to exercise Warrants, the Company may at its sole discretion
decide to make the settlement in cash instead of issuing shares in the Company to the Warrant
Holder. Consequently, the Company will in such situation automatically buy back the relevant War-
rants from the Warrant Holder.
7.2 If the Company decides to buy back Warrants, the Company shall repay the relevant subscription
amount paid to the Company by the Warrant Holder in connection with the delivery of the exercise 

	
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notice. Further, the Company shall pay to the Warrant Holder a cash amount for each Warrant
exercised by the Warrant Holder equivalent to the average market price per Share on the date on
which the exercise notice has been served by the Warrant Holder deducted an amount equivalent
to the Subscription Price (the "Cash Amount"). The Cash Amount shall be paid after deduction of
income  tax  ("A-tax")  and  other  statutory  amounts  to  be  withheld  by  the  Company.  Upon  such
payment the relevant Warrants shall be considered transferred back to the Company and the War-
rant Holder shall consequently have no further rights with respect to such Warrants.
7.3 If the Company decides to buy back Warrants and make the settlement in cash instead of delivering
shares in the Company, the Company must inform the Warrant Holder hereof within 30 days after
having received the exercise notice.
8 ADJUSTMENT OF THE CONDITIONS FOR WARRANTS IN CASE OF CERTAIN CHANGES
IN THE COMPANY'S CAPITAL STRUCTURE
8.1 In case changes are made in the Company's capital structure which entail a reduction or increase
of the value of the Warrants granted, there shall be an adjustment of the Subscription Price and/or
the number of shares that can be subscribed for by exercising the Warrants, so that the value of
the Warrants remains the same, with the exceptions set forth in this Agreement. However, the
Subscription  Price  can  never  be  adjusted  to  below  par  value.  Further,  it  is  a  condition  for  any
adjustment of the number of shares that can be subscribed for by exercising the Warrants that the
Board of Directors of the Company has been granted the necessary authority by the general meet-
ing to issue such additional number of shares in the Company.
8.2 Should the competent bodies of the Company make a final decision to issue bonus shares (e.g.
stock dividend) before the Warrant Holder has exercised her Warrants, the Subscription Price shall
be multiplied by the following factor:

and the number of shares by

where:

A: is the Company's nominal share capital before the issue of bonus shares.
B: is the nominal value of the bonus shares to be issued.

8.3 Should the competent bodies of the Company make a final decision to increase the Company's
share capital by subscription of new shares at a price below market price before the Warrant Holder
has exercised her Warrants, the Subscription Price shall be multiplied by the following factor:

and the number of shares by
where:

)(BA
A

1
k BA
t B k A

    )(
)()( 

	
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A: is the Company's nominal share capital before the capital increase.
B: is the nominal increase of the share capital.
k: is the market price of the shares before the capital increase.
t: is the Subscription Price for the new shares.

8.4 Should the competent bodies of the Company make a final decision to change the nominal value
of the shares in connection with a decision whereby the share capital of the Company is reduced
by allocation to a separate fund and/or cover of loss, before the Warrant Holder has exercised her
Warrants, neither the Subscription Price nor the number of shares shall be amended. Consequently
the Warrant Holder shall retain the right to subscribe for the same number of shares at the Sub-
scription Price. However, each Warrant shall entitle the Warrant Holder to subscribe for 1 share of
the new nominal value so decided by the competent bodies of the Company.
8.5 Should the competent bodies of the Company make a final decision to change the nominal value
of the shares (without any other simultaneous changes of the capital of the Company), e.g. in
situations not comprised by Clause 8.4, before the Warrant Holder has exercised her Warrants, the
Subscription Price shall be multiplied by the following factor:

and the number of shares by

where:

A:  is  the  nominal  value  of  each  share  after  the  nominal  value  of the  shares  has  been
changed.
B: is the nominal value of each  share before the nominal value of the shares has  been
changed.

8.6 Should the Company within any year decide to distribute dividends, the amount shall be considered
a  distribution  to  the  shareholders  which  shall  result  in  an  adjustment  of  the  Subscription  Price
according to the following formula:
TK1 = TK -

where:

TK: is the Subscription Price for the Warrants before the distribution of dividends.
u: is the total amount of dividends.
D: is the total number of shares in the Company.
B
A

1
D
D u ) 1 (  

	
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8.7 If the share capital of the Company is reduced by means of payment to the shareholders at a price
higher than the market price, the Subscription Price shall be calculated as follows:
TK1 = TK -

where:

TK: is the Subscription Price for Warrants before the reduction of the share capital.
A: is the nominal share capital of the Company before the reduction of the share capital.
B: is the nominal reduction of the share capital.
k: is the market price of the shares before the reduction of capital.
t: is the rate of the shares by which the share capital is reduced.

8.8 If the share capital of the Company is reduced by payment to the shareholders at a price lower
than the market price, the Subscription Price shall be calculated as follows:
TK1 = TK +

where:

TK: is the Subscription Price for Warrants before the reduction of the share capital.
A: is the nominal share capital of the Company before the reduction of the share capital.
B: is the nominal reduction of the share capital.
k: is the market price of the shares before the reduction of capital.
t: is the rate of the shares by which the share capital is reduced.

8.9 If the Company participates in a merger as the continuing company, there shall be no adjustment
of the Subscription Price or the number of shares that may be subscribed for.
8.10 In the event that the general meeting passes a resolution to demerge the Company, the Warrant
Holder shall – after the demerger – have the number of Warrants that shall entitle him/her to
subscribe for shares in the receiving company by which the Warrant Holder is or would have been
employed or, in the event that the Warrant Holder is not or has not been employed by the Com-
pany, the company with which the Warrant Holder has the closest relation. The number of Warrants
shall entitle the Warrant Holder to the same potential stake that an exercise of all Warrants prior
to the demerger would have resulted in, adjusted by the ratio between the values of the different
surviving companies. Moreover, the terms applying to the surviving Warrants shall be the same as
the terms stipulated in this Agreement.
A
k t B)(
A
t k B)(  

	
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8.11 In other cases of changes in the capital structure of the Company, including issuance of warrants,
convertible debt instruments or the like, resulting in a change of the value of the issued Warrants,
the Subscription Price for the granted Warrants shall to the extent possible be adjusted, so that
the value is not reduced or increased, subject, however, to Clause 8.14 below.
8.12 The Subscription Price shall not be reduced to a price lower than the nominal value of the shares
(par). If an adjustment of the Warrants to preserve their value would result in the price being
reduced to below par, the Warrants shall lapse, unless the Warrant Holder accepts that the Sub-
scription Price is increased to par without compensation.
8.13 If the share capital is reduced in order to cover losses, the number of shares that the Warrant
Holder may subscribe for by exercising the Warrants shall be reduced (rounded down) proportion-
ately to the nominal reduction of the capital, compared to the total nominal share capital of the
Company before the reduction.
8.14 The following changes in the capital structure of the Company shall not result in any adjustment
of the Subscription Price or the number of shares that the Warrant Holder may subscribe for:
(i) An increase or reduction of the Company's capital at market price, including issue of shares
according to Clause 7.1 of the Articles of Association of the Company.
(ii) Issue of shares, options, warrants or the like to employees of the Company or to employees
of a group-related company and/or their fully Warrant Holder owned companies for some or
more of the Warrant Holders, possibly at a favourable price, including but not limited to the
issue of shares according to Clause 8.1 of the Articles of Association of the Company con-
cerning warrants.
(iii) Issue of warrants, convertible debt instruments or the like to third parties on usual market
terms as part of mezzanine financing or similar financing.

8.15 If the number of new shares that may be subscribed for by exercise of the Warrants is adjusted
upwards in accordance with this Clause 8, the Company's maximum share capital shall be increased
similarly.
9 TRANSFERABILITY
9.1 Each  Warrant  is  a  non-negotiable  instrument.  Any  transfer,  pledging  or  other  assignment  of  a
Warrant shall be subject to the prior written consent of the Board of Directors of the Company,
which may be granted, denied or conditioned in the absolute discretion of the Board of Directors
of the Company (with the exemption of a transfer due to the death of the Warrant Holder, in which
case the Board of Directors shall approve a transfer mortis causa to the Warrant Holder's closest
relatives).
9.2 The Warrants must not be subject to enforcement of any kind and must not be lodged as security
towards a third party.
10 CONDITIONS FOR NEW SHARES ISSUED FOLLOWING EXERCISE OF THE WARRANTS
10.1 Subject to the decision on the issue of Warrants, including the related capital increase, made by
the Board of Directors of the Company in accordance with the authority set forth in Clause 8.4 of
the Articles of Association of the Company, the following terms and conditions shall apply to the
new shares issued by the exercise of Warrants covered by this Agreement,
(i) the existing shareholders shall not have any pre-emptive right to the new shares;
(ii) the new shares issued on the basis of exercised Warrants shall be paid up in cash at the
same date as the notice of the exercise of Warrants is forwarded;
(iii) the new shares shall be issued in the holder's name and shall be registered in the name of
the Warrant Holder in the Company's register of shareholders; 

	
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(iv) the new shares shall be negotiable shares;
(v) the new shares are freely transferable;
(vi) the pre-emptive right of the new shares in connection with future capital increases shall not
be limited;
(vii) the new shares shall carry a right to dividend and other rights in the Company as from the
time when the relevant capital increase has been registered by the Danish Commerce and
Companies Agency;
(viii) in case of any general changes in the rights of the shares in the Company, the new shares
shall carry the same rights as the other shares in the Company at the time of exercise; and
(ix) the Company shall pay the costs in connection with the issue of Warrants pursuant to this
Agreement and the costs in connection with the subsequent exercise of the Warrants. The
Company's costs in connection with the issue of Warrants pursuant to this Agreement and
the related capital increase are estimated at maximum DKK 100,000.
11 CAPITAL INCREASE IN CONNECTION WITH THE EXERCISE OF THE WARRANTS
11.1 In the event that the Warrant Holder gives notification on time of the exercise of the Warrants, the
Company shall carry out the relating increase of capital.
11.2 The maximum increase of capital that may be subscribed according to this Agreement is calculated
on the basis of Clauses 2.1 and 2.3. The maximum amount may be increased or reduced in ac-
cordance with the provisions on adjustment set forth in Clause 8.
12 COSTS RELATED TO THE ISSUE OF SHARES
12.1 All costs related to the stockbroker and settlement fees charged in connection with the Warrant
Holder's exercise of the Warrants shall be borne by the Company.
13 CESSATION OF EMPLOYMENT STATUS
13.1 If the Warrant Holder terminates the employment with the Employer or if the employment is ter-
minated by the Employer due to the Warrant Holder's material breach of the employment relation-
ship or if the Warrant Holder has been dismissed summarily in a legitimate way due to cause, all
un-exercised warrants - whether the Warrants vested or not - will lapse immediately without any
compensation being payable.
13.2 If the Employer terminates the employment and this is not due to the Warrant Holder's material
breach of the employment relationship or to the Warrant Holder having been dismissed summarily
in a legitimate way or if the Warrant Holder dies, Warrants that have vested (see Clause 2.5) on
the date of termination of notice being served may be exercised at the latest in the ordinary exercise
window falling no later than 6 months after the date of the termination notice being served by the
Company or the date on which the Warrant Holder dies. Warrants not exercised as set out in this
Clause 13.2 will lapse without any compensation being payable. For the avoidance of doubt, War-
rants that are not vested on the date of the termination notice being served shall lapse without any
compensation being payable to the Warrant Holder.
13.3 If the Warrant Holder terminates the employment and the termination is due to the material breach
by the Employer, the Warrant Holder is entitled to exercise Warrants in accordance with the terms
set out in this Agreement as if the Warrant Holder was still employed with the Company.
14 INSIDER TRADING
14.1 Sale of shares subscribed for by any exercise of Warrants is subject to the provisions on insider
trading applicable at any time, including the Company's internal rules governing trade in securities
issued by the Company. 

	
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15 TAX IMPLICATIONS
15.1 All tax obligations and  consequences to the Warrant Holder resulting from this Agreement, the
Warrants issued or the shares acquired by the exercise of such Warrants, are the sole responsibility
of the Warrant Holder and of no concern to the Company.
15.2 The Warrant Holder is strongly encouraged to seek tax advice in connection with entering into this
Agreement.
16 GOVERNING LAW AND VENUE
16.1 The construction, validity and performance of this Agreement shall be governed by and construed
in accordance with the laws of Denmark without regard to conflicts of laws principles. Further, the
Danish Stock Options Act shall not apply to this Agreement.
16.2 Any dispute, controversy or claim arising out of or relating to this Agreement, or the breach, ter-
mination or validity thereof shall be settled by the Danish courts according to Danish law, unless
the Company decides to settle the dispute by arbitration.
16.3 Should the Company decide to settle the dispute by arbitration, such dispute shall be finally settled
by  arbitration  in  accordance  with the  Rules  of  Procedure  of  the  Danish  Institute  of  Arbitration
(Danish Arbitration).
16.3.1 The place of the arbitration shall be Copenhagen, Denmark.
16.3.2 The language to be used in the arbitral proceedings shall be English, unless otherwise agreed.
16.3.3 If more than one Warrant Holder becomes subject to arbitration proceedings fully or partly due to
the same set of factual circumstances, such parties agree that the cases can be dealt with jointly
by one arbitration tribunal.
16.3.4 The arbitration tribunal shall decide the distribution of costs connected with the arbitration case.
16.3.5 The existence of an arbitration case as well as any ruling made by the arbitration tribunal shall be
kept in strict confidence.

For and on behalf of the Company:

By____________________________________

Name: Martin Nicklasson
Title: Chairman of the Board of Directors

By_____________________________________
Name: Emmanuel Dulac
Title: CEO

  

	
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Agreed and accepted by the Warrant Holder:

By_____________________________________
Name: Marino Garcia
Title: SVP, Corporate & Business DevelopmentExhibit 10.4

 

 

STRICTLY CONFIDENTIAL - LEGAL PRIVILEGE

 

Agreement on Warrants – U.S.

 

	Between	Zealand Pharma A/S
	 	 
	 	Sydmarken 11
	 	 
	 	DK-2860 Søborg
	 	 
	 	Denmark
	 	 
	and	[Name]
	 	 
	 	(the "Warrant Holder")

 

     

     

    

 

TABLE OF CONTENTS

 

		1	Purpose	3

 

		2	Grant of Warrants	3

 

		3	Vesting of Warrants	3

 

		4	Exercise of the Warrants	4

 

		5	Transfer of shares	4

 

		6	Transferability of Warrants to another
party	4

 

		7	Buy Back of Warrants - cash settlement	4

 

		8	Conditions for New Shares issued
following Exercise of the Warrants	5

 

		9	Leaver provisions	5

 

		10	Claw-back	6

 

		11	Tax Implications	6

 

		12	adjustments of the conditions for
warrants in case of certain events	6

 

		13	Capital increase in connection with
the Exercise of the Warrants	8

 

		14	Other terms	8

 

		15	Data protection	8

 

		16	Governing Law and Venue	9

 

		17	Acceptance of the terms	9

 

		18	Appendix: formulas for Adjustment
of the Conditions for Warrants in case of certain Changes in the Company's Capital Structure	 	10

 

    2 

     

    

 

This Agreement on Warrants (the "Agreement")
is entered into on 14 September 2020 between:

 

		(1)	Zealand Pharma A/S, CVR no. 20 04 50 78, Sydmarken 11, 2860 Søborg Denmark (the "Company")
and

 

		(2)	the person who has accepted this Agreement, thereby becoming a warrant holder (the “Warrant Holder”)

 

- the Company and the Warrant Holder hereinafter
collectively referred to as the "Parties" and separately as a "Party"

 

		1	Purpose

 

		1.1	The purpose of offering warrants is to attract, retain and motivate eligible employees, by creating a
common interest in the Company’s growth and the development of the share price. By offering warrants, the Board of Directors of
the Company (“the Board”) also wants to reward all employees for dedicated and focused results supporting the Company’s
long term development and growth.

 

		2	Grant of Warrants

 

		2.1	The Warrant Holder is granted [●] warrants in the
Company free of charge (the "Warrants"). Each Warrant entitles the Warrant Holder to subscribe for one share of nominally
DKK 1, at a subscription price of DKK 216.80 that is equal to the market price of the Company's shares at the time of grant (the "Subscription
Price"), in accordance with the terms of this Agreement and the Company's Articles of Association.

 

		2.2	The value of each Warrant is DKK [●], and the
total value of the Warrants granted is DKK [B&S Total value]. (The total value
is the value of each Warrant multiplied with the total number of Warrants granted.)

 

		2.3	The Warrant Holder receives a Warrant grant with a value corresponding to a certain percentage of the
Warrant Holder’s annual fixed salary, that may be adjusted upwards or downwards at the Board’s discretion. The value of the
Warrants is determined in accordance with recognized valuation methods such as the Black Scholes formula.

 

		2.4	It is a condition for the grant of Warrants as set out in this Agreement that the Warrant Holder has entered
into an employment contract with the Company or a subsidiary of the Company (the "Employer"), and not under notice, at
the date of this Agreement.

 

		2.5	Participation in the grant under this Agreement does not entitle an employee to future grants or participation
in future reward plans.

 

		3	Vesting of Warrants

 

		3.1	The Warrants vest in equal tranches over three years after the date of grant, with 1/3 of the Warrants
vesting each year. This means that the first 1/3 of the Warrants will vest on 14 September 2021, the second 1/3 will vest on 14 September 2022
and the final 1/3 on 14 September 2023. The date on which Warrants vest is referred to as the "Vesting Date". Warrants
are not subject to any performance targets other than the share price, which must be higher at the time of vesting than at the time of
grant for the Warrants to have any value. The period from the Grant Date until the Vesting Date is referred to as the Vesting Period.

 

		3.2	For the Warrants to vest, the Warrant Holder must be employed by the Employer throughout the Vesting Period.

 

    3 

     

    

 

		4	Exercise of the Warrants

 

		4.1	The Warrants have a total lifetime of 10 years, which means that the Warrants have an exercise period
starting from their respective Vesting Date until, and including, 13 September 2030 (the “Exercise Period”). This
means that 1/3 of the Warrants have an exercise of period of 9 years, 1/3 have an exercise period of 8 years and the remaining 1/3 have
an exercise period of 7 years.

During the Exercise Period, the Warrants may be exercised during specific trading windows following the Company’s publication of
quarterly reports (including annual and semi-annual reports). The exact dates for the trading windows will be displayed on the online
portal on the Company’s intranet. Warrants not exercised on or before the last day of the Exercise Period will automatically lapse
and become void without any further notice or compensation.

 

		4.2	Upon exercise, the Warrant Holder may, for each Warrant, subscribe for 1 share in the Company of a nominal
value of DKK 1.00 at the Subscription Price. The Subscription Price may be regulated due to extraordinary events as set out in this Agreement.

 

		4.3	To exercise his/her Warrants, the Warrant Holder must electronically give notice to the Company, using
the online portal available on the Company's intranet. Practicalities in connection with the exercise of the Warrants may be changed by
the Company. In that case, the Warrant Holder will be notified in writing by the Company.

 

		4.4	The Warrant Holder will pay in cash to the Company an amount equal to the total value of the Warrants
(the "Subscription Amount") at the same time as giving notice of the exercise of the Warrants.

 

		5	Transfer of shares

 

		5.1	It is a precondition for the Company's transfer of shares to the Warrant Holder that he/she opens a securities
account with a bank. Any costs arising from such securities account shall be borne by the Warrant Holder. Once the Company has received
the correct Subscription Amount, the Warrant Holder will receive a transfer of the shares. The shares will be transferred as soon as possible
and in a manner decided by the Company at its sole discretion. Costs related to the transfer of shares to the Warrant Holder’s account
will be borne by the Company.

 

		5.2	Any sale of Company shares by any employee of the Company is subject to the provisions on insider trading
applicable at any time, including the Company's internal rules governing trade in Company-issued securities. This also applies to
shares subscribed for by exercising Warrants.

 

		6	Transferability of Warrants to another party

 

		6.1	Each Warrant is a non-negotiable instrument. The Warrant Holder must request the Board’s written
consent for any transfer, pledging or other assignment of a Warrant. The request may be granted, denied or conditioned at the Board’s
discretion.

 

		6.2	The Warrants must not be subject to enforcement of any kind and must not be lodged as security towards
a third party.

 

		7	Buy Back of Warrants - cash settlement

 

		7.1	Upon exercise of the Warrants as set forth in Clause 4, the Company is entitled, at its sole discretion,
to make a cash settlement and to buy back the Warrants instead of issuing the shares which have been subscribed for. If the Company decides
to make use of this possibility, the Warrant Holder will be informed of the decision to buy back the Warrants within 30 days following
the receipt of the exercise notice in the online portal. The buy back of the Warrants will happen automatically.

 

		7.2	A buy back means that the Company will pay the Warrant Holder a cash amount for each Warrant that is equivalent
to (a) the subscription price plus (b) the difference between (i) the average market price per share on the date of the
exercise and (ii) the Subscription Price (a+b= the “Cash Amount”). Where legally required, the Cash Amount shall
be paid after deduction of the necessary tax and other statutory amounts that the Employer is required to withhold. Once the Company has
realised the payments, the relevant Warrants are considered transferred back to the Company.

 

    4 

     

    

 

		8	Conditions for New Shares issued following Exercise of the
Warrants

 

		8.1	The issuance of Warrants decided by the Board, including the related capital increase, is done in accordance
with the Clause 8.4 of the Articles of Association of the Company. Consequently, the new shares issued by the exercise of Warrants are
regulated by the following terms and conditions:

 

		(i)	the existing shareholders shall not have any pre-emptive right to the new shares;

 

		(ii)	the new shares are issued in the Warrant Holder's name and registered in his/her name in the Company's
register of shareholders;

 

		(iii)	the new shares are negotiable shares;

 

		(iv)	the new shares are freely transferable;

 

		(v)	the new shareholders will be entitled to the same rights as the existing shareholders;

 

		(vi)	the new shares will carry the same rights as the existing shares at the time of exercise, and going forward
in case of any general change in the rights of the shares in the Company; and

 

		(vii)	the Company shall pay the costs in connection with the issue and exercise of Warrants pursuant to this
Agreement.

 

		9	Leaver provisions

 

		9.1	Bad Leavers

 

		9.1.1	Bad Leavers are not entitled to keep any unexercised Warrants, whether these have vested or not. They
will lapse immediately on the date of termination (date of notice being served by the Warrant Holder or by the Employer) without any compensation
being payable.

 

Warrant Holders are considered Bad Leavers
in scenarios where

 

		·	the Warrant Holder terminates the employment,
and this is not due to the Company’s material breach of the employment relationship

 

		·	the Employer terminates the employment due to
the Warrant Holder's material breach of the employment relationship

 

		·	the Warrant Holder has been summarily dismissed
in a legitimate way due to cause

 

		9.2	Good Leavers

 

		9.2.1	Good Leavers are entitled to keep any Warrants which are vested (see Clause 3.1) on the date of termination of employment (date of notice being served, or date of the Warrant Holder’s death or retirement). The vested Warrants may be exercised in the relevant trading window as set forth in Clause 4, but no later than 6 months after the date of termination of employment. Warrants not exercised as set out in this Clause 9.2.1 will lapse without any compensation.

                                                                                For the avoidance of doubt, unvested Warrants on the date of termination of employment lapse without any compensation.

 

Warrant Holders are considered Good
Leavers in scenarios where

 

		·	the Employer terminates the employment and this
is not due to the Warrant Holder's material breach of the employment relationship

 

		·	the Warrant Holder retires

 

		·	the Warrant Holder dies

 

		·	the Warrant Holder terminates the employment
due to a material breach by the Employer

 

    5 

     

    

 

		10	Claw-back

 

		10.1	If the Warrants have been granted or vested based on data which turns out to have been falsified, or materially
or manifestly misstated, the Company shall – in exceptional cases as determined by the Board in its sole discretion – be entitled
to:

 

		(i)	cancel Warrants obtained by the Warrant Holder in relation to the incorrect information or figures, and

 

		(ii)	reclaim from the Warrant Holder, in full or in part, any undue value of shares in the Company delivered,
to the extent that the Warrant Holder was or should have been aware of this.

 

		10.2	If any amount reclaimed is not settled within 14 days after the Company's written demand to the Warrant
Holder, the Company may set off any amounts repayable pursuant to Clause 11.1 against any outstanding or future amounts owed by the Company
to the Warrant Holder, including any salary payments or other remuneration.

 

		11	Tax Implications

 

		11.1	The Parties agree that the total value of the Warrants granted is the value set out in Clause 2.2.

 

		11.2	The tax implications related to the Warrants are a personal matter for the Warrant Holder. The Warrant
Holder is encouraged to seek advice from a public accountant or another tax consultant at their own expense.

 

		12	adjustments of the conditions for warrants in case of certain
events

 

		12.1	In case of extraordinary events such as the ones listed below, the Board may, at their sole discretion,
decide that the conditions for Warrants may be adjusted in accordance with Clause 12.2. In these cases, the Company will notify the Warrant
Holder. Within two weeks from the date of the Company’s notification, the Warrant Holder must give notice to the Company if he/she
wishes to exercise the Warrants wholly or partly.

 

		12.2	Adjustments in case of liquidation, merger, public offering, acquisition, delisting

 

		12.2.1	In the event that the Company's general meeting passes a resolution to liquidate the Company, the Board
(at their sole discretion) can decide that Warrants may be exercised as set forth in Clause 4 within a certain timeframe. If the Warrant
Holder does not wish to exercise the Warrants, the Warrants automatically become void without compensation once the Company is finally
liquidated.

 

		12.2.2	In the event that the general meeting passes a resolution to merge the Company and such merger results
in the Company being discontinued, the Board (at their sole discretion) can decide that Warrants may be exercised within a certain timeframe
as set forth in Clause 4. If the Warrant Holder wishes to exercise the Warrants, the Company will ensure the shares are registered in
the Warrant Holder's depot at least five trading days before the last day of trading of the Company's shares. If the Warrant Holder does
not wish to exercise the Warrants, the Warrants automatically become void without compensation once the Company is finally discontinued.

 

		12.2.3	In the event that a voluntary or mandatory public offer pursuant to Sections 44 - 47 of
                                                                                              the Danish Act on Capital Markets is made, the Board (at their sole discretion) can decide that Warrants may be exercised as set
                                                                                              forth in Clause 4 within a certain timeframe. If the Warrant Holder does not wish to exercise the Warrants, the Warrants and this
                                                                                              Agreement will remain in full effect until the completion of the offer. Following completion of the offer, the Board can decide that
                                                                                              Warrants may be exercised within a four-week period. If the Warrant Holder then does not wish to exercise the Warrants, the Warrants
                                                                                              and this Agreement will lapse.

 

		12.2.4	In the event of a compulsory acquisition of the Company's shares pursuant to the Danish Companies Act
is initiated, the Board (at their sole discretion) can decide that Warrants may be exercised as set forth in Clause 4 within a certain
timeframe. If the Warrant Holder does not wish to exercise the Warrants, the Warrants automatically become void without compensation following
the completion of the acquisition of the Company's shares.

 

    6 

     

    

 

		12.2.5	In the event that the Company's general meeting passes a resolution to delist the Company from Nasdaq Copenhagen, the Board (at their sole discretion) can decide that Warrants may be exercised as set forth in Clause 4 within a certain timeframe. If the Warrant Holder wishes to exercise the Warrants, the Company will ensure that the shares are registered in the Warrant Holder's depot at least five trading days before the last day of trading of the Company's shares. If the Warrant Holder does not wish to exercise the Warrants, the Warrants automatically become void without compensation following the completion of the delisting of the Company.

                                                                                Following completion of such delisting, the Board can decide that Warrants may be exercised up to two times a year for the remaining part of the Exercise Period.

 

		12.2.6	In the event that the Company decides to sell the most profitable and material assets of the Company,
the Board (at their sole discretion) can decide that Warrants may be exercised as set forth in Clause 4 within a certain time period.
If the Warrant Holder does not wish to exercise the Warrants, the Warrants and this Agreement will remain in full effect.

 

		12.3	Adjustments in case of certain changes in the Company's capital

 

		12.3.1	In case changes are made in the Company's capital structure which entail a change in the total value of
the Warrants granted, the number or Subscription Price of the Warrants shall be adjusted to avoid affecting the total value of the Warrants,
with the exceptions set forth in this Agreement. Further, the Board must have been granted the necessary authority by the general meeting
to adjust the number of shares that can be subscribed for by exercising the Warrants.

 

		12.3.1.1	If the number of new shares that may be subscribed for by exercise of the Warrants is adjusted upwards
in accordance with this Clause 12.3.1, the Company's maximum share capital shall be increased accordingly.

 

		12.3.1.2	The Subscription Price shall not be reduced to a price lower than the nominal value of the shares (DKK
1). If an adjustment of the Warrants to preserve their value would result in the price being reduced to below the nominal value, the Warrants
shall lapse, unless the Warrant Holder accepts that the Subscription Price is increased to the nominal value without compensation.

 

		12.3.2	If the total share capital of the Company is reduced in order to cover losses, the number of shares that
the Warrant Holder may subscribe for by exercising the Warrants shall be reduced (rounded down) proportionately.

 

		12.3.3	Should the competent bodies of the Company make a final decision to issue bonus shares before the Warrant
Holder has exercised his/her Warrants, the Subscription Price shall be multiplied by the factor in Clause 18.1.

 

		12.3.4	Should the competent bodies of the Company make a final decision to increase the Company's share capital
by subscription of new shares at a price below market price before the Warrant Holder has exercised his/her Warrants, the Subscription
Price shall be multiplied by the factor in Clause 18.2.

 

		12.3.5	Should the competent bodies of the Company make a final decision to change the nominal value of the shares
(without any other simultaneous changes of the capital of the Company), e.g. in situations not comprised by Clause 12.4.1, before the
Warrant Holder has exercised his/her Warrants, the Subscription Price shall be multiplied by the factor in Clause 18.3.

 

		12.3.6	Should the Company decide to distribute dividends, the amount will be considered a distribution to the
shareholders, and result in an adjustment of the Subscription Price according to the formula in Clause 18.4.

 

		12.3.7	If the share capital of the Company is reduced by means of payment to the shareholders at a price higher
than the market price, the Subscription Price shall be calculated as in Clause 18.5.

 

    7 

     

    

 

		12.3.8	If the share capital of the Company is reduced by payment to the shareholders at a price lower than the
market price, the Subscription Price shall be calculated as in Clause 18.6.

 

		12.3.9	In the event that the general meeting passes a resolution to demerge the Company, the Warrant Holder is
entitled to keep the same potential stake as the exercise of his/her warrants would have resulted in prior to the demerger, adjusted by
the ratio between the values of the different surviving companies. This means that, after the demerger, the Warrant Holder will receive
a number of Warrants allowing them to subscribe to shares in the company they have the closest relation with. Moreover, the terms stipulated
in this Agreement will apply to the surviving Warrants.

 

		12.4	Changes in capital structure leading to no adjustment to Warrants conditions

 

		12.4.1	The following changes in the capital structure of the Company shall not result in any adjustment of the
Subscription Price or the number of shares that the Warrant Holder may subscribe for:

 

		(i)	An increase or reduction of the Company's capital at market price, including issue of shares according
to Clauses 7.1-7.3 of the Articles of Association of the Company;

 

		(ii)	Issue of shares, options, warrants or the like, possibly at a favorable price, to employees of the Company
or to employees of a group-related company, or to some or all Warrant Holders (including Warrant Holder owned companies);

 

		(iii)	Issue of warrants, convertible debt instruments or the like to third parties on usual market terms as
part of mezzanine or similar financing;

 

		(iv)	Should the Company participate in a merger as the continuing company;

 

		(v)	Should the competent bodies of the Company make a final decision to change the nominal value of the shares,
resulting in the share capital of the Company being reduced before the Warrant Holder has exercised his/her Warrants. The Warrant Holder
retains the right to subscribe for the same number of shares at the Subscription Price. However, each Warrant entitles the Warrant Holder
to subscribe for 1 share at the new nominal value.

 

		13	Capital increase in connection with the Exercise of the Warrants

 

		13.1	In the event that the Warrant Holder gives notification in accordance with Clause 4 to the exercise the
Warrants, the Company shall carry out the related increase in capital.

 

		13.2	The maximum increase in capital that may be subscribed to according to this Agreement is calculated on
the basis of Clause 2.2. The maximum amount may be increased or reduced in accordance with the provisions on adjustment(s) set forth
in Clause 12.

 

		14	Other terms

 

		14.1	The Company's Articles of Association are available at the Company's office for inspection. Any future
amendments to the Company's Articles of Association shall automatically be accepted by the Warrant Holder.

 

		14.2	In connection with the Company’s register of shareholders, a register of all issued Warrants shall
be kept.

 

		14.3	In addition to the specific provisions in this Agreement entitling the Board to make adjustments or changes
to the plan, the Board is entitled to amend the Agreement, effective for all Warrants granted or vested, at the Board’s sole discretion.

 

		15	Data protection

 

		15.1	In accordance with the General Data Protection Regulation, the Warrant Holder is hereby informed that
the personal data relating to the his/her name, contact details, holding of Warrants and shares and salary will be processed to administer
the Warrants, to ensure fulfillment of the Company’s contractual obligations toward the Warrant Holder, and to comply with applicable
laws, regulations and court orders. The personal data will further be transferred from the Employer where the Warrant Holder is employed
to other employers, to the online administration platform provider or to public authorities to the extent required in connection with
the allocation or administration of the Warrants. More comprehensive information about the processing of the Warrant Holder’s personal
data, including the Warrant Holder’s rights with respect to such processing, can be found on the Company’s intranet.

 

    8 

     

    

 

		16	Governing Law and Venue

 

		16.1	The construction, validity and performance of this Agreement shall be governed by and construed in accordance
with the laws of Denmark without regard to conflicts of laws principles. Further, the Danish Stock Options Act shall not apply to this
Agreement.

 

		16.2	Any dispute, controversy or claim arising out of or relating to this Agreement, or its breach, termination
or validity shall be settled by the Danish courts according to Danish law, unless the Company decides to settle the dispute by arbitration.
Should the Company decide to do so, such dispute shall be finally settled by arbitration in accordance with the Rules of Procedure
of the Danish Institute of Arbitration. The place of the arbitration shall be Copenhagen, Denmark and the language of the proceedings
shall be English, unless otherwise agreed. If more than one Warrant Holder becomes subject to arbitration proceedings, fully or partly
due to the same set of factual circumstances, such parties agree that the cases can be dealt with jointly by one arbitration tribunal.
The arbitration tribunal shall decide the distribution of costs connected with the arbitration case. The existence of an arbitration case
as well as any ruling made by the arbitration tribunal shall be kept in strict confidence.

 

		17	Acceptance of the terms

 

		17.1	By signing this Agreement electronically, the Warrant Holder agrees, accepts and is aware of the provisions
as set forth in this Agreement.

 

 

Signed – Martin Nicklasson

Title: Chairman of the Board of Directors

 

 

Signed – Kirsten Drejer

Title: Vice Chairman of the Board of Directors  

 

    9 

     

    

 

		18	Appendix: formulas for Adjustment of the Conditions for Warrants
in case of certain Changes in the Company's Capital Structure

 

		18.1	Should the event mentioned in Clause 12.3.3 happen, the Subscription Price will be multiplied by the following
factor:

 

 

and the number of shares by

 

where:

A: is the Company's nominal share capital
before the issue of bonus shares.

B: is the nominal value of the bonus shares
to be issued.

 

		18.2	Should the event mentioned in Clause 12.3.4 happen, the Subscription Price will be multiplied by the following
factor:

 

 

and the number of shares by

 

where:

A: is the Company's nominal share capital
before the capital increase.

B: is the nominal increase of the share
capital.

k: is the market price of the shares
before the capital increase.

t: is the Subscription Price for the new
shares.

 

		18.3	Should the event mentioned in Clause 12.3.5 happen, the Subscription Price will be multiplied by the following
factor:

 

 

and the number of shares by

 

where:

A: is the nominal value of each share
after the nominal value of the shares has been changed.

B: is the nominal value of each share
before the nominal value of the shares has been changed.

 

		18.4	Should the event mentioned in Clause 12.3.6 happen, the Subscription Price will be adjusted according
to the following formula:

 

TK1 = TK -

 

where:

TK: is the Subscription Price for the
Warrants before the distribution of dividends.

u: is the total amount of dividends.

D: is the total number of shares in the
Company.

 

    10 

     

    

 

		18.5	Should the event mentioned in Clause 12.3.7 happen, the Subscription Price shall be calculated as follows:

 

TK1 = TK -

 

where:

TK: is the Subscription Price for Warrants
before the reduction of the share capital.

A: is the nominal share capital of the
Company before the reduction of the share capital.

B: is the nominal reduction of the share
capital.

k: is the market price of the shares
before the reduction of capital.

t: is the rate of the shares by which
the share capital is reduced.

 

		18.6	Should the event mentioned in Clause 12.3.8 happen, the Subscription Price shall be calculated as follows:

 

TK1 = TK +

 

where:

TK: is the Subscription Price for Warrants
before the reduction of the share capital.

A: is the nominal share capital of the
Company before the reduction of the share capital.

B: is the nominal reduction of the share
capital.

k: is the market price of the shares
before the reduction of capital.

t: is the rate of the shares by which
the share capital is reduced.

 

    11

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