Document:

Exhibit

Exhibit 10.2
[AIRCASTLE LIMITED]

FORM OF
PERFORMANCE SHARE UNIT AGREEMENT
FOR CERTAIN EXECUTIVE OFFICERS
UNDER THE AIRCASTLE LIMITED
2014 OMNIBUS INCENTIVE PLAN

This Award Agreement (this “PSU Agreement”), dated as of _________ __, _____ (the “Date of Grant”), is made by and between Aircastle Limited, a Bermuda exempted company (the “Company”) and [_____________] (the “Participant”).  Capitalized terms not defined herein shall have the meaning ascribed to them in the Aircastle Limited 2014 Omnibus Incentive Plan (as amended from time to time, the “Plan”).  Where the context permits, references to the Company shall include any successor to the Company. 
1.     -Grant of PSUs.  The Company hereby grants to the Participant __________ performance share units (the “PSUs”), subject to all of the terms and conditions of this PSU Agreement and the Plan.  Each PSU granted hereunder represents the right to receive one Share.  The number of PSUs set forth in this Section 1 is referred to as the “Target PSUs” for purposes of this PSU Agreement.  The actual number of PSUs that may become vested is subject to the achievement of the applicable performance goals set forth on Exhibit A hereto (the “Performance Goals”) and other vesting criteria set forth in this PSU Agreement, and may be lesser or greater than the number of Target PSUs.  To the extent necessary and desirable to comply with Section 162(m) of the Code, the Committee shall certify the achievement of the Performance Goals in writing prior to the issuance of any Shares relating to vested PSUs.
2.    Lapse of Restrictions; Settlement.  

(a)    Vesting.  

(i)    General.  Except as otherwise set forth in this Section 2(a), the PSUs shall vest on  [            ] (the “Vesting Date”), subject to the achievement of the Performance Goals and the continued employment of the Participant by the Company or one of its Subsidiaries or Affiliates from the date hereof through the Vesting Date, and provided that the Participant has not given or received notice of resignation or termination as of the Vesting Date.  Shares relating to vested PSUs shall be issued to the Participant within 15 days following the date on which the Company’s annual financial statements are filed for the year in which the Vesting Date occurs, but in no event later than March 15th of the year following the year in which the Vesting Date occurs.  

(ii)    Following Certain Terminations of Employment.  Subject to the next sentence, upon termination of the Participant’s employment with the Company and its Subsidiaries and Affiliates for any reason, any PSUs that are not vested as of the date of such termination of employment shall be forfeited without payment of any consideration and neither the Participant nor any of the Participant’s successors, heirs, assigns, or personal representatives shall thereafter have any further rights or interests in such PSUs.  Notwithstanding the foregoing:

(x)    in the event that the Participant’s employment with the Company or a Subsidiary or Affiliate is terminated by the Company without Cause or by the Participant for Good Reason (each, a “Qualifying Termination”), then the Performance Period shall end as of the last day of the Company’s last fiscal quarter ending prior to the date of such Qualifying Termination, and a number of PSUs shall immediately vest on the date of such Qualifying Termination based on achievement of the Performance Goals as of the last day of the Performance Period, and the corresponding number of Shares shall be issued to the Participant within 15 days following the date on which the Company’s financial statements are filed for the Company’s last fiscal quarter ending prior to the date of such Qualifying Termination, but in no event later than March 15th of the year following the year in which such Qualifying Termination occurs, subject to the Participant’s execution (and non-revocation) of a separation agreement prepared by the Company (or any Subsidiary or Affiliate) which includes, inter alia, a general release of claims; and 

(y)    in the event that a Change in Control occurs prior to the Vesting Date, then the Performance Period shall end as of the date of the Change in Control and the Performance Goals shall be deemed to be satisfied as of the date of such Change in Control at the greater of (x) the level of achievement resulting in vesting percentages of 75% of the Target PSUs and (y) the actual level of achievement as of the date of such Change in Control (as set forth on Exhibit A hereto).  The resulting number of PSUs (the “Resulting Awards”) shall be treated as follows:

(A)    if the acquiring or successor entity assumes the Resulting Awards, the Resulting Awards shall continue to be subject to all of the terms and conditions of the PSUs as in effect immediately prior to the Change in Control, except that the Resulting Awards shall be subject to vesting based solely on the continued employment of the Participant with the Company or a Subsidiary or Affiliate through the Vesting Date, without regard to achievement of the Performance Goals or any other performance criteria, and the corresponding number of Shares that become vested as of the Vesting Date shall be issued to the Participant in accordance with Section 2(a)(i); provided that in the event of either (i) a Qualifying Termination or (ii) a termination of the Participant’s employment as a result of the death or Disability of the Participant, in each case after the date of a Change in Control and prior to the Vesting Date, the Resulting Awards shall immediately vest and the corresponding number of Shares shall be issued to the Participant or his/her heirs, assigns or personal representatives, as the case may be, within 60 days following the date of such termination, but in no event later than March 15th of the year following the year in which such termination occurs; and 

(B)    if the acquiring or successor entity does not agree to assume the Resulting Awards in accordance with the preceding subsection (A), then the Resulting Awards shall immediately vest on the date of the Change in Control and the Participant shall be entitled to receive the same consideration with respect to each such Resulting Award as the holder of a Common Share is entitled to receive as a result of such Change in Control.  

(z)    in the event that the Participant’s employment with the Company or a Subsidiary or Affiliate is terminated as a result of the death or Disability of the Participant, then the Performance Period shall end as of the last day of the Company’s last fiscal quarter ending prior to the date of such termination of employment, and the greater of (x) the Target PSUs and (y) the  number of PSUs that would have vested based on achievement of the Performance Goals as of the last day of the Performance Period shall immediately vest, and the corresponding number of Shares shall be issued to the Participant or his/her heirs, assigns or personal representatives, as the case may be, within 15 days following the date on which the Company’s financial statements are filed for the Company’s last fiscal quarter ending prior to the date of such termination, but in no event later than March 15th of the year following the year in which such termination occurs. 

(b)    Restrictions.  Until the PSUs vest and Shares are issued to the Participant in settlement of such PSUs as provided in Section 2(a) hereof, or as otherwise provided in the Plan, no Transfer (as defined in Section 6 hereof) of the PSUs or any of the Participant’s rights with respect to the PSUs (including any right to the Dividend Equivalent Payment), whether voluntary or involuntary, by operation of law or otherwise, shall be permitted.  Unless the Administrator determines otherwise, upon any attempt to Transfer any PSUs or any rights in respect of PSUs before vesting, such PSUs, and all of the rights related thereto (including any right to the Dividend Equivalent Payment), shall immediately expire. 
3.    Adjustments.  Pursuant to Section 5 of the Plan, in the event of a Change in Capitalization, the Administrator shall make such equitable changes or adjustments as it deems necessary or appropriate to the number and kind of securities or other property (including cash) issued or issuable in respect of out-standing PSUs.

4.    Changes.  The Administrator may accelerate the Vesting Date for, or otherwise adjust any of the terms of, the PSUs; provided that, subject to Section 5 of the Plan, no action under this Section shall adversely affect the Participant’s rights hereunder.

5.    Notices.  All notices and other communications under this PSU Agreement shall be in writing and shall be given by facsimile or first class mail, certified or registered with return receipt requested, and shall be 

deemed to have been duly given three days after mailing or 24 hours after transmission by facsimile to the respective parties, as follows: (i) if to the Company, c/o Aircastle Advisor LLC, 300 First Stamford Place, 5th Floor, Stamford CT 06902, Attn: General Counsel and (ii) if to the Participant, using the contact information on file with the Company.  Either party hereto may change such party’s address for notices by notice duly given pursuant hereto.

6.    Protections Against Violations of Agreement.  No purported sale, assignment, mortgage, hypothecation, transfer, charge, pledge, encumbrance, gift, transfer in trust (voting or other) or other disposition of, or creation of a security interest in or lien on, any of the PSUs or any agreement or commitment to do any of the foregoing (each, a “Transfer”) by any holder thereof in violation of the provisions of this PSU Agreement will be valid, and the Company will not transfer any of said PSUs on its books, nor will any distributions be paid thereon, unless and until there has been full compliance with said provisions to the satisfaction of the Company.  The foregoing restrictions are in addition to and not in lieu of any other remedies, legal or equitable, available to enforce said provisions.

7.    No Obligation to Register.  The Company shall be under no obligation to register the Shares relating to the PSUs pursuant to the Securities Act or any other federal or state securities laws.
8.    Taxes.
(a)    The Participant understands that he or she (and not the Company) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by this PSU Agreement.  The Participant shall pay to the Company promptly upon request, and in any event at the time the Participant recognizes taxable income in respect of the grants hereunder, or the Company or an Affiliate may at its option deduct from the Participant’s next normal payroll, an amount equal to the taxes the Company determines it is required to withhold with respect to the grants hereunder.  The Participant may satisfy the foregoing requirement by making a payment to the Company in cash or, with the approval of the Administrator, in its sole discretion, by either (i) electing to have the Company withhold from the issuance of Shares relating to the PSUs or (ii) by delivering to the Company Shares that the Participant already owns, in each case having a value equal to the minimum amount of tax required to be withheld (or such other amount as may be permitted by applicable law and accounting standards).  Such Shares shall be valued at their Fair Market Value on the date as of which the amount of tax to be withheld is determined.  Any fractional amounts shall be settled in cash.
(b)    The Participant acknowledges that the tax laws and regulations applicable to the PSUs and the disposition of the Shares the Participant may receive following vesting of the PSUs are complex and subject to change, and it is the sole responsibility of the Participant to obtain his or her own advice as to the tax treatment of the terms of this PSU Agreement.

BY SIGNING THIS PSU AGREEMENT, THE PARTICIPANT REPRESENTS THAT HE OR SHE HAS REVIEWED WITH HIS OR HER OWN TAX ADVISORS THE FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF THE TRANSACTIONS CONTEMPLATED BY THIS PSU AGREEMENT AND THAT HE OR SHE IS RELYING SOLELY ON SUCH ADVISORS AND NOT ON ANY STATEMENTS OR REPRESENTATIONS OF THE COMPANY OR ANY OF ITS AGENTS.  THE PARTICIPANT UNDERSTANDS AND AGREES THAT HE OR SHE (AND NOT THE COMPANY) SHALL BE RESPONSIBLE FOR ANY TAX LIABILITY THAT MAY ARISE AS A RESULT OF THE TRANSACTIONS CONTEMPLATED BY THIS PSU AGREEMENT

9.    Failure to Enforce Not a Waiver.  The failure of the Company to enforce at any time any provision of this PSU Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

10.    Confidentiality.

(a)    The Participant acknowledges that during the period of his service with the Company he shall have access to the Company’s Confidential Information (as defined below).  All books of account, records, systems, correspondence, documents, and any and all other data, in whatever form, concerning or containing any reference to the works and business of the Company or its affiliated companies shall belong to the Company and shall be given up to the Company whenever the Company requires the Participant to do so.  The Participant agrees that the Participant shall not at any time during the term of the Participant’s service or thereafter, without the Company’s prior 

written consent, disclose to any person (individual or entity) any information or any trade secrets, plans or other information or data, in whatever form, (including, without limitation, (a) any financing strategies and practices, pricing information and methods, training and operational procedures, advertising, marketing, and sales information or methodologies or financial information and (b) any Proprietary Information (as defined below)), concerning the Company’s or any of its affiliated companies’ or customers’ practices, businesses, procedures, systems, plans or policies (collectively, “Confidential Information”), nor shall the Participant utilize any such Confidential Information in any way or communicate with or contact any such customer other than in connection with the Participant’s service by the Company.  The Participant hereby confirms that all Confidential Information constitutes the Company’s exclusive property, and that all of the restrictions on the Participant’s activities contained in this PSU Agreement and such other nondisclosure policies of the Company are required for the Company’s reasonable protection.  Confidential Information shall not include any information that has otherwise been disclosed to the public not in violation of this PSU Agreement. This confidentiality provision shall survive the termination of this PSU Agreement and shall not be limited by any other confidentiality agreements entered into with the Company or any of its Affiliates.

(b)    With respect to any Confidential Information that constitutes a “trade secret” pursuant to applicable law, the restrictions described above shall remain in force for so long as the particular information remains a trade secret or for the two year period immediately following termination of the Participant’s service for any reason, whichever is longer.  With respect to any Confidential Information that does not constitute a “trade secret” pursuant to applicable law, the restrictions described above shall remain in force during the Participant’s service and for the two year period immediately following termination of Participant’s service for any reason.

(c)    The Participant agrees that the Participant shall promptly disclose to the Company in writing all information and inventions generated, conceived or first reduced to practice by him alone or in conjunction with others, during or after working hours, while in the employ of the Company (all of which is collectively referred to in this PSU Agreement as “Proprietary Information”); provided, however, that such Proprietary Information shall not include (i) any information that has otherwise been disclosed to the public not in violation of this PSU Agreement and (ii) general business knowledge and work skills of the Participant, even if developed or improved by the Participant while in the employ of the Company.  All such Proprietary Information shall be the exclusive property of the Company and is hereby assigned by the Participant to the Company.  The Participant’s obligation relative to the disclosure to the Company of such Proprietary Information anticipated in this Section shall continue beyond the Participant’s termination of service and the Participant shall, at the Company’s expense, give the Company all assistance it reasonably requires to perfect, protect and use its right to the Proprietary Information.

11.    Governing Law.  This PSU Agreement shall be governed by and construed according to the laws of Bermuda.

12.    Incorporation of Plan.  The Plan is hereby incorporated by reference and made a part hereof, and the PSUs and this PSU Agreement shall be subject to all terms and conditions of the Plan and this PSU Agreement.

13.    Amendments; Construction.  The Administrator may amend the terms of this PSU Agreement prospectively or retroactively at any time, but no such amendment shall impair the rights of the Participant hereunder without his or her consent.  To the extent the terms of Section 10 above conflict with any prior agreement between the parties related to such subject matter, the terms of Section 10 shall supersede such conflicting terms and control.  Headings to Sections of this PSU Agreement are intended for convenience of reference only, are not part of this PSU Agreement and shall have no effect on the interpretation hereof.

14.    Survival of Terms.  This PSU Agreement shall apply to and bind the Participant and the Company and their respective permitted assignees and transferees, heirs, legatees, executors, administrators and legal successors. 

15.    Rights as a Shareholder.  The Participant shall have none of the rights of a holder of Common Shares (including the right to vote or receive dividends or distributions) with respect to the PSUs prior to the date on which the Participant receives shares in settlement of such PSUs. 

16.    Agreement Not a Contract for Services.  Neither the Plan, the granting of the PSUs, this PSU Agreement nor any other action taken pursuant to the Plan shall constitute or be evidence of any agreement or u

nderstanding, express or implied, that the Participant has a right to continue to provide services as an officer, director, employee, consultant or advisor of the Company or any Subsidiary or Affiliate for any period of time or at any specific rate of compensation.

17.    Authority of the Administrator; Disputes.  The Administrator shall have full authority to interpret and construe the terms of the Plan and this PSU Agreement.  The determination of the Administrator as to any such matter of interpretation or construction shall be final, binding and conclusive. 

18.    Severability.  Should any provision of this PSU Agreement be held by a court of competent jurisdiction to be unenforceable, or enforceable only if modified, such holding shall not affect the validity of the remainder of this PSU Agreement, the balance of which shall continue to be binding upon the parties hereto with any such modification (if any) to become a part hereof and treated as though contained in this original PSU Agreement.

19.    Section 409A.  The PSUs granted hereunder are intended to be exempt from, or to the extent subject thereto, to comply with Section 409A of the Code, and, accordingly, to the maximum extent permitted, this PSU Agreement shall be interpreted in accordance therewith.  Notwithstanding anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, the Participant shall not be considered to have terminated employment or service with the Company for purposes of this PSU Agreement and no payment shall be due to the Participant under this PSU Agreement until the Participant would be considered to have incurred a “separation from service” from the Company and its Affiliates within the meaning of Section 409A of the Code.  Notwithstanding anything to the contrary in this PSU Agreement, to the extent that any PSUs (or any other amounts payable under any plan, program or arrangement of the Company or any of its Affiliates) is payable upon a separation from service and such payment would result in the imposition of any individual tax and penalty interest charges imposed under Section 409A of the Code, the settlement and payment of such awards (or other amounts) shall instead be made on the first business day after the date that is six (6) months following such separation from service (or death, if earlier).  Each amount to be paid or benefit to be provided under the Plan and this Agreement shall be construed as a separate identified payment for purposes of Section 409A of the Code. 

20.    Acceptance.  The Participant hereby acknowledges receipt of a copy of the Plan and this PSU Agreement.  The Participant has read and understands the terms and provisions of the Plan and this PSU Agreement, and accepts the PSUs subject to all the terms and conditions of the Plan and this PSU Agreement.  The Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under this PSU Agreement.

21.    Clawback.  The Participant hereby acknowledges and agrees that, in accordance with Section 28 of the Plan, the PSUs and the Shares relating to the PSUs are subject to such deductions and clawbacks as may be required to be made pursuant to any law, government regulation or stock exchange listing requirement, or any policy adopted by the Company pursuant to or in anticipation of any such law, government regulation or stock exchange listing requirement, including, without limitation, the Aircastle Limited Executive Incentive Compensation Recoupment Policy, adopted January 27, 2016, as may be amended from time to time. 

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Performance Share Unit Agreement on the day and year first above written.

AIRCASTLE LIMITED

By     
Name     
Title     

[NAME OF PARTICIPANT]

___________________________________
The Participant

875914-NYCSR05A - MSW

EXHIBIT A
PERFORMANCE GOALS

The Administrator established an initial PSU grant expressed as a number of shares, referred to in Section 1 of the PSU Agreement as the “Target PSUs”. The number of PSUs that are eligible to vest (or that may be earned, in the event of a Change in Control, death or disability) on the last day of the Performance Period in accordance with the terms and conditions of the applicable subsections of Section 2(a) of the PSU Agreement shall be finally determined by the Committee (or its designee, as applicable) as follows: 

1.    Relative TSR Performance Goal.  A total of one-half of the PSUs shall be subject to vesting based on the Company’s achievement of the Relative TSR Performance Goal during the Performance Period, as set forth in the table below.  The number of PSUs, if any, that shall vest shall be finally determined by the Committee (or its designee, as applicable) by multiplying (i) one-half of the Target PSUs by (ii) the applicable vesting percentage set forth in column C of the table below. 

	
			
	A
Performance Level for Performance Period
	B
Relative TSR
Performance Goal
	C
Vesting Percentage

	Below Threshold
	0
	 

	Threshold
	0
	 

	Target
	0
	100%

	Maximum
	0
	 

2.    Absolute Adjusted ROE Performance Goal.  A total of one-half of the PSUs shall be subject to vesting based on the Company’s achievement of the Absolute Adjusted ROE Performance Goal during the Performance Period, as set forth in the table below.  The number of PSUs, if any, that shall vest shall be finally determined by the Committee (or its designee, as applicable) by multiplying (i) one-half of the Target PSUs by (ii) the vesting percentage to be determined by dividing (x) the applicable vesting percentage for each complete or partial year during the Performance Period by (y) the number of complete or partial years during the Performance Period.

	
					
	 
	Vesting Percentages

	0%
	0
	100%
	0

	Below Threshold
	Threshold
	Target
	Maximum

	YEAR
	 
	 
	 
	 

	YEAR
	 
	 
	 
	 

	YEAR
	 
	 
	 
	 

3.     Linear Interpolation.  If the level of achievement of the Performance Goals set forth on this Exhibit A is greater than the applicable Threshold amount but less than the applicable Target amount, or greater than the applicable Target Amount but less than the applicable Maximum amount, the number of Shares eligible for vesting upon the achievement of such Performance Goal shall be finally determined by the Committee (or its designee, as applicable) by linear interpolation between the number of Shares that would vest at the defined ends of the applicable spectrums. 

4.    Definitions.  For purposes of this Exhibit A, the following terms have the following meanings:

(a)    “Adjusted ROE” means Adjusted Net Income divided by the average shareholders’ equity, excluding the fair market value of derivatives.  For purposes of this PSU Agreement, Adjusted Net Income, or ANI, is net income before certain expenses related to the Company’s financings and interest rate derivative accounting, share-based compensation expense and other items deemed unusual by the Company when viewed in the context of the Company’s ongoing business.

(b)    “Absolute Adjusted ROE Performance Goal” means the average of the vesting percentages achieved during the Performance Period with respect to the Adjusted ROE targets set by the Committee [and communicated] to the Participant as soon as practicable following (i) the Date of Grant with respect to the first calendar year of the Performance Period and (ii) the start of each of the second and third calendar years during the Performance Period (as applicable).

(c)    “Performance Period” means the period beginning on January 1, 2016 and ending on the Vesting Date, unless, prior to the Vesting Date, (i) the Participant experiences a Qualifying Termination or the Participant’s employment with the Company or a Subsidiary or Affiliate is terminated as a result of the death or Disability of the Participant, in which case  the Performance Period shall end on the last day of the Company’s last fiscal quarter ending prior to the termination date or (ii) a Change in Control occurs, in which case the Performance Period for (A) the Absolute Adjusted ROE Performance Goal shall end on the last day of the Company’s last fiscal quarter ending prior to the date of such Change in Control and (B) the Relative TSR Performance Goal shall end on the date of such Change in Control. 

(d)    “Relative TSR Performance Goal” means the rank order of the Company’s Total Shareholder Return during the Performance Period as compared to the Total Shareholder Return of each of the companies included in the S&P MidCap 400 Index (or such successor index or, if the S&P MidCap 400 Index is discontinued, a comparable index determined by the Committee) at the start of the Performance Period.

(e)    “Total Shareholder Return” of an entity shall be determined by dividing (i) the sum of (A) the cumulative amount of dividends or similar equity distributions during the Performance Period, assuming dividend/distribution reinvestment, and (B) the difference between the average closing stock price for the common equity of such entity over the thirty (30) day period immediately preceding the last day of the Performance Period (or, in respect of the Company only, if a Change in Control occurs prior to the Vesting Date, the closing stock price on the last trading day immediately preceding the date of such Change in Control) and the average closing stock price for the common equity of such entity over the thirty (30) day period immediately preceding the first day of the Performance Period by (ii) the average closing stock price for the common equity of such entity over the thirty (30) day period immediately preceding the first day of the Performance Period, with such amount expressed as a percentage so that each of the Company and the component companies of the  S&P MidCap 400 Index (or such successor index or, if the S&P MidCap 400 Index is discontinued, a comparable index determined by the Committee) may be ranked in order from the highest Total Shareholder Return to the lowest Total Shareholder Return and the relative ranking of the Company within that order may be determined (references to rank herein are determined from the lowest return so that, for example, the 10th percentile is the 10th percentile from the lowest total shareholder return). Firms included in the S&P Mid Cap 400 Index (or such successor index or, if the S&P MidCap 400 Index is discontinued, a comparable index determined by the Committee) at the start of the Performance Period that cease to exist as publicly traded companies at the end of the Performance Period (x) due to bankruptcy, are to be included in the ranking with a TSR = -100% or (y) as a result of an acquisition, being taken private or a similar event, are to be excluded from the calculations.Blue Sphere Corporation 8-K

Exhibit 10.1

 

SERVICES
AGREEMENT

THIS
SERVICES AGREEMENT (this “Agreement”) is made effective as of the Effective Date between Blue Sphere Corporation,
a Nevada corporation having its principal place of business at 301 McCullough Drive, 4th Floor, Charlotte, North Carolina 28262
(the “Company”) and Ran Daniel, an individual residing at ______________________________ (the “Executive”).
The Company and the Executive are each referred to herein as a “Party” and collectively, the “Parties”.

WHEREAS,
the Company wishes to engage the Executive as its Chief Financial Officer and to provide the Services (as defined below) and the
Executive agrees to be the Company’s Chief Financial Officer and to provide the Services for the compensation and otherwise
in accordance with the terms and conditions contained in this Agreement; and

WHEREAS,
the Executive represents that he possesses all experience, ability and skills relating to the Company’s business that are
necessary to render the Services to the Company and the Executive have been and is in the business of providing such Services.

NOW,
THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, accepted and agreed to, the Parties, intending to be legally bound, agree to the terms set forth
below.

1.                 
TERM.

1.1.           
Term. This Agreement will commence on May 1, 2016 (the “Effective Date”) and expire on May 1, 2017,
unless sooner terminated pursuant to Section 4 hereof (the “Initial Term”). Upon the end
of the Initial Term, the Parties may extend this Agreement upon mutual consent for additional one (1) year periods (collectively,
the “Term”). 

2.                 
TITLE, DUTIES AND SERVICES.

2.1.                
The Executive shall serve as the Company’s Chief Financial Officer. Subject to the terms and conditions set forth herein,
the Company hereby retains Executive to assist the Company and its affiliates and/or subsidiaries as Chief Financial Officer on
all strategic and tactical matters as they relate to budget management, cost benefit analysis, financial forecasting needs, securing
new funding, assisting in the making of strategic decisions, business development, project appraisal, projects management,
financial analysis, transaction negotiation and structuring, certifying to the accuracy of financial statements pursuant to applicable
U.S. Securities and Exchange Commission (“SEC”) rules and regulations, monitoring banking activities, overseeing accounts
payable and accounts receivable as well as such other duties, authority, and responsibility as shall be determined, expanded or
limited from time to time by the Company’s Chief Executive Officer or the Company’s Board of Directors (collectively,
the “Services”). Upon request from the Company, which may be made any time at the Company’s sole discretion,
and the Executive’s acceptance of such request, the Services shall be expanded to include preparing, filing and ensuring
of compliance with all applicable federal, state and local regulations, including, but not limited to the Company’s
reporting requirements with the SEC (the “Reporting Services”). At such time that the Company directs and the
Executive accepts responsibility to perform the Reporting Services, all references herein to the Services shall be deemed to include
the Reporting Services.

2.2.           
The Services shall be provided solely and exclusively by the Executive. The Executive shall not subcontract, assign, transfer
or otherwise delegate performance of any Services without the prior written consent of the Company.

    	1 

    	 

    

2.3.           
Throughout the Term of this Agreement, the Executive shall devote all the necessary time and attention to
the business of the Company according to the needs of the Company from time to time. 

2.4.           
The Executive shall perform the Services in an efficient, expeditious and professional manner. In performance of the Services
and this Agreement, the Executive shall comply with all applicable laws, ordinances, rules, regulations, orders, licenses, permits
and other governmental requirements (including, but not limited to, any such requirements imposed upon the Company with respect
to the Services). 

2.5.           
The Executive represents and warrants to the Company that he is under no contractual or other restrictions or obligations which
are inconsistent with the execution and delivery of this Agreement, or which may interfere with the performance of the Services
and that this Agreement constitutes the valid and binding obligation of the Executive. In addition, the Executive represents and
warrants that the execution, delivery and performance of this Agreement will not (i) constitute a default under or conflict with
other activities or any other agreement, understanding or commitment, to which he is a party, or by which he is bound and (ii)
does not require the consent of any person or entity.

3.                 
COMPENSATION.

3.1.           
Subject to the performance of the Services to be rendered hereunder, the Company shall pay to the Executive for all Services
rendered hereunder a monthly fee in an aggregate amount of $12,000 USD (the “Compensation”). At such time that
the Company directs and the Executive accepts responsibility to perform the Reporting Services, the Compensation shall be increased
to $15,000 per month, which shall applied pro rata based on the date the Executive accepts such responsibility. The Company
and Executive will evaluate the Consideration each year following the Initial Term, and may increase or decrease the Compensation
by mutual agreement of the Parties.

3.2.           
The Compensation shall be paid to the Executive against an invoice validly issued, in accordance with applicable law, at the end
of each calendar month under this Agreement, and the Company will pay Executive the Compensation within five (5) business days
from the receipt of any such invoice.

3.3.           
Except as provided herein, the Compensation shall constitute the full and total compensation due to the Executive under this Agreement,
and the Executive shall not be entitled to any other form of compensation, commission, fee, securities, remuneration, reimbursement
or any other form of payment or consideration for the provision of Services hereunder. 

3.4.           
The Executive shall be solely responsible for, and will make proper and timely payment of, any and all withholding, taxes, duties,
fees and/or other impositions that may be levied pursuant to applicable law upon the Executive in connection with the provision
of the Services hereunder, the fulfillment of the Duties of Executive. In the event that pursuant to any law or regulation, tax
is required to be withheld at source from any payment made to the Executive, the Company shall withhold said tax at the rate set
forth in the certification issued by the appropriate taxing authority or at the rate determined by said law or regulation. Executive
agrees to indemnify the Company against all claims, liabilities or expenses the Company incurs as a result of a breach of Executive’s
obligations under this Section 3.4. 

    	2 

    	 

    

3.5.           
Executive shall be reimbursed by the Company for all reasonable expenses that shall have been incurred by Executive in performing
his Services and/or for promoting the business of the Company, upon submission of a monthly statement of documented expenses.
All expenses will be reimbursed in accordance with the Company’s standard policies and procedures. Reimbursement pursuant
to this Section 3.5 shall be effected within five business days after the submission of each statement as aforesaid.

3.6.           
The Company will consider from time to time whether to reward Executive with other consideration for his Services such as: bonuses,
options and/or other securities, at the sole discretion of the Company.  The Executive
shall be entitled to participate in the Company’s incentive plans, if any, and to receive such bonus payments or incentive
compensation as may be determined at any time or from time to time by the Board of Directors of the Company (or any authorized
committee thereof) in its discretion. 

4.                 
TERMINATION.

4.1.           
Both Parties shall be entitled to terminate this Agreement, for any reason and at any time, by providing at least 30 days’
prior written notice to the other Party.

4.2.           
 Notwithstanding the above, the Company shall be entitled to terminate this Agreement with immediate effect and without prior
notice, at any time, (i) for Cause or (ii) due to the death or Disability (as defined below) of the Executive. For the purpose
of this Section 4:

4.2.1.     
“Disability” shall mean (i) any physical or mental illness or injury, as a result of which the Executive fails
to render the Services required of him pursuant to this Agreement, for (a) a period of two (2) successive months, or (b) an aggregate
of two (2) months in any twelve (12) month period, upon which disability shall be deemed to occur upon the end of such two-month
period, or (ii) any case where the Executive is unable or fails, for any reason, to render the Services required pursuant to this
Agreement. 

4.2.2.     
“Cause” shall mean the occurrence of any (one or more) of the following circumstances: (i) the
filing of any indictment(s) against the Executive for any crime, felony or offense in any jurisdiction (ii) a breach by the Executive
of any of the material terms or conditions hereof, provided that such breach, if reasonably curable, is not cured within
fourteen (14) days of the date that such breach began; (iii) any negligent, fraudulent or bad faith act or omission by the Executive
concerning or toward the Company, or any act or omission by the Executive designed to harm the Company; (iv) any act of fraud
or embezzlement of funds of the Company by the Executive; or (v) falsification of the Company’s records or reports or any
other willful misconduct by the Executive in connection with the business affairs of the Company.

4.3.           
Upon termination, neither Party shall have any further obligations under this Agreement, except for the obligations, which by
their terms survive this termination. Upon termination and, in any case, upon the Company’s request, the Executive shall
return immediately to the Company or destroy all Confidential Information (as defined below) and copies thereof and any other
property belonging to the Company, including, but not limited to (if applicable), any confidential materials, keys, documents,
reports, research records, computer files and/or records, passwords for all computer records, bank statements, checks or any other
Company materials.

4.4.           
Any termination of this Agreement shall not affect the Executive’s eligibility to receive payment of Compensation and reimbursement
of expenses for Services already provided to the Company
prior to the date that notice of termination is provided by either Party, or at such later date as the Parties may agree.

    	3 

    	 

    

5.                 
CONFIDENTIALITY; PROPRIETARY RIGHTS; NON-COMPETE. 

5.1.           
Confidential Information.

5.1.1.     
The Executive acknowledges that the Executive will, either directly or indirectly, have access to and be entrusted with Confidential
Information (whether oral, written or by inspection) relating to the Company or its respective affiliates, associates or customers.
“Confidential Information” includes all non-public, confidential or proprietary information in any form, tangible
or intangible, which pertains in any manner to the Company, including information produced or acquired by the Executive, or any
other employee or consultant, in the course of performing services for or on behalf of the Company. The Executive acknowledges
that Confidential Information is intended to be broadly defined and construed and shall include all information whose unauthorized
disclosure could be detrimental to the Company’s interests, whether or not the Company has expressly identified such information
as Confidential Information.

5.1.2.     
The Executive acknowledges that the Company’s Confidential Information constitutes a proprietary right, which the Company
is entitled to protect. Accordingly, the Executive covenants and agrees that the Executive will keep in strict confidence the
Company’s Confidential Information and will not, without prior written consent of the Company, disclose, use or otherwise
disseminate the Company’s Confidential Information, directly or indirectly, to any third party.

5.1.3.     
The general prohibitions contained in this Section 5.1 against the unauthorized disclosure, use or dissemination of the Company’s
Confidential Information will not apply in respect of any Company Confidential Information that:

(i)                    is available to the public generally as of the Effective Date;

(ii)                   becomes part of the public domain through no fault of, or breach of Section 5.1 by, the Executive;

(iii)                  was known or in the lawful possession of the Executive prior to the Effective Date; or

(iv)                  is compelled by applicable law to be disclosed, provided that the Executive gives the Company prompt written notice of such requirement
prior to such disclosure and provides assistance at the request and expense of the Company, in obtaining an order protecting the
Company’s Confidential Information from public disclosure.

5.1.4.     
The Executive agrees that, upon termination of his services for the Company, he will immediately surrender to the Company or destroy,
at the Company’s election, all Company Confidential Information then in his possession or under his control.

5.2.           
Non Competition. The Executive agrees and undertakes that he will not, at any time during the Term and for a period of
twelve (12) months thereafter, become financially interested in or be employed by business or venture that competes directly with
the Company.

    	4 

    	 

    

5.3.           
No Solicitation. The Executive covenants and undertakes that he will not, at any time during the Term and for a period
of twelve (12) months thereafter, for any reason, directly or indirectly, in any way:

5.3.1.     
solicit, hire or engage the services of any employee or consultant of the Company or its affiliates or persuade or attempt to
persuade any such individual to terminate his employment or relationship with the Company or any of its affiliates;

5.3.2.     
persuade or attempt to persuade any Customer and /or supplier to restrict, limit or discontinue purchasing or selling and/or providing
and/or retaining the services provided by the Company or supplied to the Company or any of its affiliates to any such Customer
or Supplier or to reduce the amount of business which any such Customer and/or Supplier has customarily done, or contemplates
doing, with the Company or any of its affiliates in respect of the Company’s business, or to solicit or take away, or attempt
to solicit or take away, from the Company or any of its affiliates any of its Customers and/or Suppliers in respect of the Company’s
business.

5.3.3.     
For the purposes of this Agreement, “Customer” and “Supplier” means any Person who is, at
any time during the Term, a customer and or a supplier of the Company, respectively.

6.                 
THE NATURE OF THE CONTRACTUAL RELATIONSHIP.

6.1.           
Independent Contractor. The Executive shall at all times act as an independent contractor, and shall not be, and/or claim
to be, an employee of the Company. The Executive warrants that he is aware that this Agreement is only an agreement for the provision
of services on a strictly contractual basis, and does not create employer-employee relations between him and the Company and does
not confer upon her any rights, except for those explicitly set forth herein. 

6.2.           
No Employment Status. The Executive undertakes that he and/or anyone on its/her behalf shall not claim, demand, sue or
bring any cause of action against the Company in connection with alleged employer-employee relations between him and the Company,
and/or any right and/or payment that an employee is entitled to, and if he does so, he shall indemnify the Company upon its first
demand for any expense that may be occasioned to it in respect of, or in connection with, a claim as aforesaid, including legal
fees. Without prejudice to the generality of the aforesaid, it is hereby agreed that the Executive shall not be entitled to, and
knowingly and voluntarily waive any rights to, receive from the Company severance pay and/or any other payment and/or other consideration
deriving from employer-employee relations and/or the termination thereof and/or any social benefits including, but not limited
to, health and accident insurance, life insurance, sick leave pension or vacation and similar benefits.

7.                 
MISCELLANEOUS.

7.1.           
Equitable Relief. The Executive agrees that any breach of Section 5 above would cause irreparable damage
to the Company and that, in the event of such breach, the Company shall have, in addition to any and all remedies of law, the
right to an injunction, specific performance or other equitable relief to prevent the violation or threatened violation of the
Executive’s obligations hereunder.

7.2.           
Waiver. Any waiver by a Party of a breach of any provision of this Agreement shall not operate or be construed as a waiver
of any subsequent breach of the same or any other provision hereof. All waivers by any Party shall be in writing.

    	5 

    	 

    

7.3.           
Severability; Reformation. In case any one or more of the provisions (or parts of a provision) contained in this Agreement
shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision (or part of a provision) of this Agreement; and this Agreement shall, to the fullest extent
lawful, be reformed and construed as if such invalid or illegal or unenforceable provision (or part of a provision), had never
been contained herein, and such provision (or part of the provision) reformed so that it would be valid, legal and enforceable
to the maximum extent possible, provided that the same does not curtail the original intent of the Parties as evidenced
herein. Without limiting the foregoing, if any provision (or part of provision) contained in this Agreement shall for any reason
be held to be excessively broad as to duration, activity or subject, it shall be construed by limiting and reducing it, so as
to be enforceable to the fullest extent compatible with then existing applicable law.

7.4.           
Assignment. The Company shall have the right, subject to the delivery of a prior written notice to the Executive, to assign
its rights and obligations under this Agreement to a party which assumes the Company’ obligations hereunder. The Executive
shall not have the right to assign his rights or obligations under this Agreement without the prior written consent of the Company.

7.5.           
Headings; Interpretation. Headings and subheadings are for convenience only and shall not be deemed to be a part of this
Agreement. The preamble, exhibits and schedules to this Agreement constitute an integral part hereof. Words in the singular shall
include the plural and vice versa; and reference to a person shall also include corporate bodies and other legal entities. 

7.6.           
Amendments. This Agreement may be amended or modified, in whole or in part, only by an instrument in writing signed by
the Company and the Executive. 

7.7.           
Notices. Any notices or other communications required hereunder shall be in writing and shall be deemed given when delivered
in person or when mailed, by certified or registered first class mail, postage prepaid, return receipt requested, addressed to
the Parties at their addresses specified in the preamble to this Agreement or to such other addresses of which a Party shall have
notified the others in accordance with the provisions of this Section 7.7, and shall be deemed effectively given upon the
earlier of actual receipt or: (a) personal delivery to the Party to be notified, (b), if sent by electronic mail or facsimile
(with electronic confirmation of receipt) on the recipient’s next business day, (c) three (3) days after having been sent
by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) business day after deposit with a nationally
recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt.

7.8.           
Governing Law. This Agreement shall be governed by the internal laws of the State of Nevada, without regard to its conflict
of law provisions. 

7.9.           
Entire Agreement. This Agreement supersedes all prior agreements, written or oral, between the Parties hereto relating
to the subject matter of this Agreement.

7.10.         
Counterparts. This Agreement may be executed in two or more counterparts, each of which shall constitute an original and
all of which shall be deemed a single agreement.

[Remainder
of Page Left Intentionally Blank]

 

    	6 

    	 

    

IN
WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed and delivered on and as of the Effective
Date.

 

	COMPANY:	 	EXECUTIVE:
	 	 	 	 	 
	BLUE SPHERE CORPORATION	 	 
	 	 	 	 	 
	By:	/s/ Shlomo Palas	 	 By:	 /s/ Ran Daniel
	Name:	Shlomo Palas	 	 Name:	 Ran Daniel
	Title:	President & Chief Executive Officer

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