Document:

exh10_34.htm

 

Exhibit 10.34

 

 

THIRD AMENDMENT TO LETTER AGREEMENT

 

THIS THIRD AMENDMENT TO LETTER AGREEMENT (the “Amendment”), made and entered into as of the 15th day of July, 2014 by and between ZBB ENERGY CORPORATION, a Wisconsin corporation, hereinafter referred to as the “Corporation,” and DANIEL NORDLOH, hereinafter referred to as “you” or the “Employee.”

 

W I T N E S S E T H:

 

WHEREAS, you and the Company have previously agreed to and operated under the terms of a letter employment agreement dated April 29, 2010, as amended by the First Amendment to Letter Agreement dated April 28, 2011, the Addendum to Employment Agreement dated August 29, 2011, and by the Second Amendment to Letter Agreement dated March 23, 2012 (the “Letter Agreement”); and

 

WHEREAS, the Corporation and the Employee desire to amend the Letter Agreement in the manner set forth herein.

 

NOW, THEREFORE, the Corporation and the Employee, in consideration of the mutual promises hereinafter set forth, do hereby promise and agree as follows:

 

	 	1.	Defined Terms. Any capitalized terms in this Amendment that are not defined herein shall have the meaning assigned to them in the Letter Agreement.
	 	 	 
	 	2.	Salary. Section 2 of the Letter Agreement shall be deleted in its entirety and replaced with the following:
	 	 	 
	 	 	●	Effective June 25, 2014, you will be entitled to an annual salary of $190,000, payable in accordance with ZBB’ s normal salaried payroll practices. The CEO will review, at least annually, your overall compensation with a view to increasing it if, in the sole judgment of the CEO, the performance of ZBB or your services merit such an increase.
	 	 	 	 
	 	 	●	ZBB shall be entitled to withhold from amounts to be paid to you hereunder any federal, state, or local withholding or other taxes or charges which it is required to withhold under applicable law.

 

	 	3	Letter Agreement in Full Force and Effect. Except as amended hereby, the Letter Agreement shall be unchanged and shall remain in full force and effect in all respects in accordance with the terms and conditions thereof. From and after the date hereof, all references to the Letter Agreement shall be deemed to be references to the Letter Agreement as amended hereby.
	 	 	 
	 	4	Restrictive Covenant Agreement. Employee acknowledges and agrees that he is bound by the ZBB Corporation Restrictive Covenant Agreement to which he is a party, and nothing in this agreement shall be interpreted to supersede or limit his obligations under such agreement.

 

 

  

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	 	5	Binding Effect. This Amendment shall be binding upon the parties hereto, their respective legal representatives, successors, heirs, and assigns.
	 	 	 
	 	6	Governing Law. This Amendment and all questions of its interpretation, performance, enforceability, and the rights and remedies of the parties hereto shall be governed by and determined in accordance with the internal laws of the State of Wisconsin.

 

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day, month, and year first above written.

 

	 	CORPORATION:	 
	 	 	 
	 	ZBB ENERGY CORPORATION	 
	 	 	 
	 	By: /s/ Eric C. Apfelbach                                   	CEO      
	 	 	(Title)
	 	 	 
	 	EMPLOYEE:	 
	 	 	 
	 	/s/ Daniel Nordloh                                                	 
	 	Daniel Nordloh	 

 

 

 

 

2EXHIBIT
10.12

FIRST
AMENDMENT TO
LEASE

 

 

This
First Amendment
to Lease
dated this 23rd
day of
July, 2014,
by and
between Bedford Realty
Company, LLC, an
Illinois Limited
Liability Company (“Landlord”)
and OneUp
Innovations, Inc., a Georgia
corporation (“Tenant”). Whereas through
the Lease Agreement
dated September
26, 2005,
(the “Lease”) Landlord
leases to Tenant
certain real property commonly known as
2745 Bankers Industrial
Drive, Doraville, Georgia (the
“Premises”).

 

WHEREAS, Landlord
and Tenant wish
to make certain
other amendments
to the Lease.

 

NOW,
THEREFORE, for good and valuable consideration, including the mutual promises contained
in this Amendment,
which Landlord and Tenant acknowledge is
sufficient, the parties hereby agree
as follows:

 

		1.	TERM: The Term of the Lease
is extended for five
(5) years and will expire
on December 31, 2020.

 

		2.	RENT: Paragraph 2 of
the Lease is hereby amended
and the Base
Rent shall be
as follows:

 

August
1, 2014 – November 30,
2014:$0 per
month

December
1, 2014 – December 31,
2014:$29,415.00 per
month

January 1,
2015 – December 31,
2015:$30,297.45 per
month

January 1,
2016 – December 31,
2016:$31,206.37 per
month

January 1,
2017 – December 31,
2017:$32,142.56 per
month

January 1,
2018 – December 31,
2018:$33,106.84 per
month

January 1,
2019 – December 31,
2019:$34,100.05 per
month

January 1,
2020 – December 31,
2020:$35,123.05 per
month

 

Tenant’s
estimated real estate tax payments pursuant
to Paragraph 28 of
the Lease shall be due and payable
during the free rent period.

 

		3.	TENANT IMPROVEMENTS:

A.                  
Tenant shall perform
the improvements
listed in
the attached proposals
contained in Exhibit
A (“Improvements”) within
six (6) months
of the execution
of this Amendment.

 

Tenant
acknowledges the savings from
the four (4) month
rental abatement in the
amount of $117,660.00 shall be
applied to the costs to complete the
Improvements. If Tenant fails to complete
the Improvements within
the six (6) month
period, Tenant
shall reimburse Landlord
for the unused
portion of
the rental abatement.

 

All work
to be
performed by a qualified and licensed
contractor. All Improvements
are to
be constructed in
a good and workmanlike manner,
and in accordance
with all applicable
laws, regulations,
and codes. Tenant shall
indemnify, defend (with attorneys
reasonably acceptable to Landlord), and
hold Landlord harmless from
and against
any and all liability,
losses, damages, costs and expense,
which arise directly or
indirectly from lien claims affecting
the Premises arising
out of
Tenant’s or
Tenant’s contractor’s
work or
that of subcontractor
or suppliers.

 

Upon
completion of the Improvements, Tenant
shall provide to Landlord a copy of
all receipts, a final contractor’s
affidavit and final lien waiver from
all contractors, and
any subcontractors or materialmen
involved in the work, and
a copy of any
permits or other approvals required
in connection with the Improvements.

 

Once
completed, the
Improvements shall become part
of the
Premises and shall
not be removed
at the time
of Tenant’s vacating
the Premises.

 

 

 

 

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B.                  
At Landlord’s sole
cost and expense,
Landlord shall repair
195+/- SF of concrete
area in the
Premises. Landlord shall
begin work as
soon as
reasonably possible after
full execution
of the Amendment.

 

4.                   
NO FURTHER MODIFICATION:  Except as
 expressly provided
above, each and all of 
the remaining
terms and conditions
of the Lease
shall remain in full
force and effect.

 

IN
WITNESS WHEREOF, the
parties herein have executed
this First Amendment to the
Lease as of
the last day
and year written below.

 

 

	LANDLORD:	TENANT:
	 	 
	BEDFORD REALTY COMPANY, LLC	ONEUP INNOVATIONS, INC.
	an Illinois Limited Liability Company	a Georgia corporation
	 	 
	By: /s/ Perry Kusakabe	By:  /s/ Louis S. Friedman
	Name: Perry Kusakabe	Name:  Louis S. Friedman 
	Title VP – Assoc. General Counsel	Title:   President & CEO
	Date: July 30, 2014	Date: July 23,2014Exhibit 10.1 2014.09.29

EXHIBIT 10.1
 
	
		
	 
	Invibio®
biomedical solutions
Invibio  LTD
Technology Centre Hillhouse International
Thornton Cleveleys. Lancashire FY5 4QD UK
Tel. +44 (0)1253 866812 Tel +44 (0)1253 851458
info@invibio.com                         www.invibio.com

29th September 2014

LDR Medical
Technopole de L'Aube
BP 2-10 902
Troyes cedex 9
France

Dear Sirs,

Letter of Amendment in respect of Supply Agreement between Invibio Ltd. and LDR Medical dated January 31 2003 and subsequent Amendments (the "Agreement").

Following our discussions we are writing to confirm that pursuant to section 27.1 of the Agreement we have agreed to make the following amendment to the Agreement:

		
	1.
	Clause 3 of the Agreement shall be amended such that the Term of the Agreement shall be extended until the 1st of November 2014 inclusive. 

All capitalized terms used in this Letter shall have the same meaning as when used in the Agreement.

This letter and all matters arising from or connected with it are governed by English Law.

Except as expressly provided in this letter of amendment, all other terms, conditions, and provisions of the Agreement shall continue in full force and effect as provided therein. 

	
			
	 
	 
	 

	/s/ Nicola Shilton
	 
	/s/ Eric Vigneron

	An authorised signatory for and on behalf of Invibio, Ltd.
	 
	An authorised signatory for and on behalf of LDR Medical

	 
	 
	 

	Name: Nicola Shilton
	 
	Name: Eric Vigneron

	Position: Contracts Administrator
	 
	Position: Deputy General Manager

	Date: September 29, 2014
	 
	Date: September 29, 2014Exhibit 4.1

BP PLC

RULES

OF THE

BP SHARE OPTION PLAN

	
Shareholders’ Approval:

	
25 November 1998

	
Committee’s Adoption:

	
25 November 1998

	
Expiry Date:

	
24 November 2008

	
Incorporating Amendments to:

	
November 2002

RULES OF THE BP SHARE OPTION PLAN

	1	Meanings Of Words Used

In these Rules:

“ADS” means an American depository share, or part thereof, representing six ordinary shares of the Company;

“Business Day” means a day on which the London Stock Exchange or as the context requires the NYSE are open for the transaction of business;

“Control” has the meaning in Section 840 of the Income and Corporation Taxes Act 1988; 

   

“Company” means BP p.l.c.;

     

“Date of Grant” means the date on which the Committee resolves to grant an Option;

“Committee” means a Committee or Committees duly authorised to operate the Plan and in the case of directors of the Company shall mean the Remuneration Committee or an authorised sub-committee of it;

“Eligible Employee” means any person who is an employee of a Participating Company and who on the Date of Grant is not an executive director of the Company.

“Exercise Condition” means a condition or conditions imposed under Rule 2.3; 

“the London Stock Exchange” means The International Stock Exchange Limited;

“Member of the Group” means:

		(i)	the Company; and

		(ii)	its Subsidiaries from time to time; and

		(iii)	any other company which is associated with the Company and is designated by the Committee as a Member of the Group;

“Model Code” means the Model Code of the Financial Services Authority for transactions in securities by directors, certain employees and persons connected with them;

“NYSE” means the New York Stock Exchange Inc.;

“Option” means a right to acquire Shares granted under the Plan;

“Optionholder” means a person holding an Option or his Personal Representatives; 

“Option Period” means a period starting on the Date of Grant of an Option and ending at the end of the day before the 10th anniversary of the Date of Grant or such shorter period as may be specified on the Date of Grant;

“Option Price” means the amount payable for each Share on the exercise of an Option calculated as described in Rule 3;

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“Participating Companies” means:

		(i)	the Company; and

		(ii)	any Subsidiary and any other company which is designated by the Committee as a Participating Company.

“Personal Representatives” means any person or persons who have obtained a valid UK grant of representation or any other person whom the Committee decides may exercise the Option after the death of the Optionholder subject to the prior satisfaction of any conditions that the Committee may determine;

“Plan” means this plan known as “The BP Share Option Plan” constituted by this document as may be amended from time to time;

“Rules” means the rules of the Plan as changed from time to time;

“Shares” means fully paid ordinary shares or securities representing ordinary shares in the Company or, as the context may require, ADSs;

“Subsidiary” means a company which is a subsidiary of the Company within the meaning given by Section 736 of the Companies Act 1985.

	2	Grant Of Options

	2.1	Grant of Options:

The Committee may grant to any Eligible Employee an Option to acquire such number of Shares or ADSs as it may determine.

	2.2	Time when Options may be granted:

		2.2.1	Options may only be granted within 42 days starting on any of the following:

		(i)	the adoption of the Plan;

		(ii)	the day after the announcement of the Company’s results to the London Stock Exchange for any period;

		(iii)	any day on which the Committee resolves that exceptional circumstances exist which justify the grant of Options; or

		(iv)	any day on which changes to the legislation or regulations affecting share option schemes are announced, effected or made.

		2.2.2	The Committee may only grant Options between the adoption of the Plan and the 10th anniversary of that date.

		2.2.3	The Committee may not grant Options at any time which would cause the Option Price to be calculated by reference to any days on or before the announcement of results.

		2.2.4	If the Committee cannot grant any Options due to restrictions imposed by statute, order, regulation or government directive, or by any code adopted by the Company based on the Model Code, the Committee may grant Options within 42 days after the lifting of such restrictions.

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	2.3	Exercise Condition:

When granting an Option, the Committee may make its exercise conditional on the satisfaction of Exercise Conditions. The Exercise Conditions must be objective, and specified at the Date of Grant. The Committee may waive or change the Exercise Conditions if anything happens which causes the Committee to consider that:

		2.3.1	changed Exercise Conditions would be a fairer measure of performance, and would be no less difficult to satisfy; or

		2.3.2	the Exercise Conditions should be waived.

	2.4	Evidence of Option:

An Option shall be evidenced by deed in such form as the Committee determines.

	2.5	No Payment:

Optionholders are not required to pay for the grant of any Option.

	2.6	Disclaimer of Option:

Any Optionholder may disclaim all or part of his Option by notice in writing to the person nominated by the Committee for this purpose, within 80 days after the Date of Grant. If this happens the Option will be deemed never to have been granted under the Plan. No consideration is payable for the disclaimer.

	2.7	Disposal restrictions:

Except for the transmission of an Option on the death of an Optionholder to his personal representatives, neither an Option nor any rights in respect of it may be transferred, assigned or otherwise disposed of by an Optionholder to any other person.

	2.8	Administrative errors:

If the Committee tries to grant an Option which is inconsistent with the Plan, the Option will be limited and will take effect from the Date of Grant on a basis consistent with the Plan.

	2.9	Options over ADSs:

The Committee may determine, in its absolute discretion, to grant Options in the form of an Option to acquire ADSs and references in these Rules to Share, Option, Option Price etc. shall be construed accordingly. Upon the exercise of any Option to acquire ADSs the Company will:

		(i)	deliver or cause to be delivered to the ADS depository the requisite number of Shares representing the relevant ADSs and shall instruct the depository to issue the corresponding American depository receipts evidencing such ADSs to the exercising Optionholder; or

		(ii)	make other arrangements for the Optionholder to acquire ADSs.

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	3	Option Price

	3.1	Setting the Price:

The Committee will set the Option Price. The Option Price, which may be expressed in sterling or in US dollars, will be:

		3.1.1	not less than the market value of a Share on the Date of Grant; and

		3.1.2	if the Shares are to be subscribed, not less than the nominal value of a Share.

	3.2	Market value:

“Market value” for the purpose of Rule 3.1 on any particular day means:

		3.2.1	the middle market quotation (as derived from the Daily Official List of the London Stock Exchange) on the immediately preceding Business Day; or

		3.2.2	if the Committee so decides, the average of the middle market quotations on the 3 immediately preceding Business Days; or

		3.2.3	where the Option Price to acquire ADSs is expressed in US dollars, the closing price as derived from the NYSE on the immediately preceding Business Day or, if the Committee so decides, the average of such prices for the 3 immediately preceding Business Days.

	4	Scheme Limits

	4.1	10 per cent. 10 year limit (all schemes):

The number of Shares which may be allocated under the Plan on any day will not exceed 10 per cent. of the ordinary share capital of the Company in issue immediately before that day, when added to the total number of Shares which have been allocated in the previous 10 years under the Plan and any other employee share scheme operated by the Company.

	4.2	5 per cent. 10 year limit (discretionary schemes):

The number of Shares which may be allocated under the Plan on any day will not exceed 5 per cent. of the ordinary share capital of the Company in issue immediately before that day, when added to the total number of Shares which have been allocated in the previous 10 years under the Plan and any other discretionary share scheme adopted by the Company.

	4.3	5 per cent. limit 5 year limit (all schemes):

The number of Shares which may be allocated under the Plan on any day will not exceed 5 per cent. of the ordinary share capital of the Company in issue immediately before that day, when added to the total number of Shares which have been allocated in the previous 5 years under the Plan and any other employee share scheme adopted by the Company.

	4.4	3 per cent. 3 year limit (discretionary schemes):

The number of Shares which may be allocated under the Plan on any day will not exceed 3 per cent. of the ordinary share capital of the Company in issue immediately before that day, when added to the total number of Shares allocated during the previous 3 years under the Plan and any other discretionary share scheme adopted by the Company.

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	4.5	Exclusions:

Where the right to acquire such Shares was released or lapsed without being exercised, the Shares concerned will be ignored when calculating the limits in this Rule.

	4.6	Meaning of Allocate:

“Allocate” means, in relation to any share option scheme, placing unissued Shares under option and, in relation to other types of employee share scheme, the issue and allotment of Shares.

	5	Variations In Share Capital

	5.1	Adjustment of Options:

If there is a variation in the equity share capital of the Company, including a capitalisation or rights issue, sub-division, consolidation or reduction of share capital, a demerger (in whatever form) or if the Company makes a special distribution including a distribution in specie:

		5.1.1	the number or nominal amount of Shares comprised in each Option; and/or

		5.1.2	the Option Price;

		may be adjusted in any way (including retrospective adjustments) which the Committee considers appropriate.

	5.2	Nominal Value:

The Option Price of an Option to acquire existing Shares may be adjusted to a price which is less than the nominal value. The Option Price of an Option to subscribe for new Shares may only be adjusted to a price less than the nominal value if the Committee resolves to capitalise the reserves of the Company in an amount equal to the difference between the adjusted Option Price and the nominal value of the Shares on the date of allotment.

	5.3	Notice:

The Committee may notify Optionholders of any adjustment made under this Rule 5.

	6	Exercise And Lapse - General Rules

	6.1	Exercise:

Except where exercise is allowed as described in Rule 7 and unless specified otherwise by the Committee on the Date of Grant, an Option can only be exercised:

		6.1.1	on or after the third anniversary of its Date of Grant;

		6.1.2	if any Exercise Condition is satisfied or waived; and

		6.1.3	so long as the Optionholder is a director or employee of a Member of the Group.

	6.2	Lapse:

An Option will lapse on the earliest of:

		6.2.1	the date the Optionholder ceases to be a director or employee of a Member of the Group, unless any of the provisions in Rule 7 apply;

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		6.2.2	any date specified in any Exercise Condition; or

		6.2.3	the expiry of the Option Period.

   

		For the purposes of Rule 6.2.1 above:

   

		(i)	a woman who leaves employment due to pregnancy will be regarded as having left employment on the date on which she indicates that she does not intend to return to work. If there is no such indication she will be regarded as having left employment on the last day on which she is entitled to return to work under the legislation which applies to the Optionholder or, if later, any other date specified in her terms of employment;

		(ii)	an Optionholder will not be treated as ceasing to be a director or employee of a Member of the Group if on that date he is employed by another Member of the Group.

	7	Exercise And Lapse - Exceptions to the General Rules

	7.1	Cessation of Employment:

		7.1.1	If an Optionholder ceases to be a director or an employee of any Member of the Group for any of the reasons set out below then, unless specified otherwise by the Committee on the Date of Grant, his Options will not lapse but may be exercised during the period of six months from the date of cessation even though any Exercise Conditions have not been satisfied. The Committee may at any time extend the period during which an Option may be exercised under this Rule 7.1. However, an Option may not be exercised after the expiry of the Option Period. :

   

			The reasons are:

   

		(i)	ill-health, injury, disability or redundancy (company induced severance);

		(ii)	retirement;

		(iii)	early retirement by agreement with the Optionholder’s employer;

		(iv)	his employing company ceasing to be under the control of the Company, or as a result of a transfer of the undertaking in which the Optionholder works to a person who is neither under the control of the Company nor a Member of the Group;

		(v)	any other reason specified by the Committee in their absolute discretion.

	7.2	Death:

If an Optionholder dies, his Options may be exercised by his Personal Representatives within one year of his death, irrespective of the satisfaction of any Exercise Condition. To the extent that any Option exercisable under this Rule 7.2 is not so exercised, it will lapse at the end of the one year period. This Rule does not extend the Option Period.

	7.3	Takeovers:

If a person (or a group of persons acting in concert) obtains Control of the Company as a result of making an offer to acquire shares which is either unconditional or is made on a condition such that if it is satisfied the person making the offer will have Control of the Company, Options may be exercised, irrespective of the satisfaction of any Exercise Condition, within the 6 month period after the person making the offer has obtained Control of the Company and any condition subject to which the offer is made has been satisfied.

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The Options will lapse at the end of the 6 month period, unless the Committee gives reasonable notice to the Optionholders before the end of the 6 month period that the Options will not lapse.

If someone becomes bound or entitled to acquire Shares under Section 428 to 430F of the Companies Act 1985, Options may be exercised, irrespective of the satisfaction of any Exercise Condition, at any time when that person remains so bound or entitled and then will lapse. If more than one period is relevant the Options will lapse at the end of the later period, unless the Committee gives notice to the Optionholders before the expiry of the relevant period that the Options will not lapse.

	7.4	Company Reconstructions:

If under Section 425 of the Companies Act 1985 a court directs that a meeting of the holders of Shares be convened to consider a scheme of arrangement involving the reconstruction of the Company or its amalgamation with any other company or companies:

		7.4.1	Optionholders may conditionally exercise their Options, irrespective of the satisfaction of any Exercise Condition, at any time between the date of the court’s direction and 12 noon on the day before the day of the shareholders’ meeting. Any Option not exercised by the end of that period will become unexercisable and will lapse; and

		7.4.2	the Committee will try to arrange for the proposals relating to the holders of the Shares to apply to each Optionholder who conditionally exercises his Options as described above.

	7.5	Demergers and other significant distributions:

If the Committee becomes aware that the Company is or is expected to be affected by any demerger, dividend in specie, super dividend or other transaction which, in the opinion of the Committee, would affect the current or future value of any Option, the Committee, may, acting fairly, reasonably and objectively, in its discretion, allow some or all Options to be exercised. The Committee will specify the period of exercise of such Options, whether the Options will lapse at the end of the period, and whether exercise is subject to satisfaction of any Exercise Condition. In exercising its discretion, the Committee may take into account considerations relating to the Company and other Members of the Group, and other employees and Optionholders. The Committee will notify any Optionholder who is affected by this Rule.

	7.6	Winding-Up:

If notice is duly given to members of the Company of a resolution for the voluntary winding-up of the Company, Options may be exercised, irrespective of the satisfaction of any Exercise Condition, until the start of the winding-up within the meaning of the Insolvency Act 1986 (but the exercise of any Option in these circumstances will be of no effect if the resolution is not passed). All Options will lapse on a winding-up of the Company unless exercised before the winding-up starts.

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If the Company is wound-up by the court, Options may be exercised, irrespective of the satisfaction of any Exercise Condition, within 2 months after the date of the winding-up order. However, the liquidator or the court (if appropriate) must authorise the issue of Shares after such exercise, and the Optionholder must apply for this authority and pay his application costs. Any Options not exercised during the 2 month period will lapse at the end of the period.

	7.7	Administration:

If an administration order is made in relation to the Company, Optionholders may exercise their Options, irrespective of the satisfaction of any Exercise Condition, within 6 weeks after the date of the administration order. However, the administrator or the court must authorise the issue of Shares after such exercise.

	7.8	Voluntary Arrangement:

If a voluntary arrangement is proposed in relation to the Company under Part I of the Insolvency Act 1986, Optionholders may exercise their Options, irrespective of the satisfaction of any Exercise Condition, within 14 days after the date of sending of any notices of meeting called under Section 3 of the Insolvency Act 1986 in relation to such proposal.

	7.9	Exchange of Options where Rule 8 does not apply

		7.9.1	Application:

This Rule applies if a company (the “Acquiring Company”):

		(i)	obtains Control of the Company as a result of making a general offer to acquire:

		•	the whole of the issued ordinary share capital of the Company (other than that which is already owned by it and its subsidiary or holding company) made on a condition such that, if satisfied, the Acquiring Company will have Control of the Company; or

		•	all the Shares (or those Shares not already owned by the Acquiring Company or its subsidiary or holding company); or

		(ii)	obtains Control of the Company under a compromise or arrangement sanctioned by the court under Section 425 of the Companies Act 1985; or

		(iii)	becomes bound or entitled to acquire Shares under Sections 428 to 430F of the Companies Act 1985

			and no determination is made by the Committee under Rule 8.

  

		7.9.2	Exchange:

If any of the events described in Rule 7.9.1 happens, an Optionholder may, during the period referred to in Rule 7.9.3, agree with the Acquiring Company to release his Option in consideration of the grant to him of a new option. The new option must be equivalent to the released option.

		7.9.3	Period for Substitution:

The period referred to in Rule 7.9.2 is:

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		(i)	in a case falling within Rule 7.9.1.(i), 6 months starting with the time when the Acquiring Company obtains Control of the Company and any condition subject to which the offer is made is satisfied;

		(ii)	in a case falling within Rule 7.9.1(ii), 6 months starting with the time when the court sanctions the compromise or arrangement; and

		(iii)	in a case falling within Rule 7.9.1(iii) the period during which the Acquiring Company remains so bound or entitled.

		7.9.4	Consequences of Exchange:

Where an Optionholder is granted a new option for release of his old option as described in this Rule 7, then:

		(i)	the new option will be treated as having been acquired at the same time as the old Option and be exercisable in the same manner and at the same time as the old Option;

		(ii)	the new option will be subject to the provisions of the Scheme as it had effect in relation to the old option immediately before the release but 11.1.2 will not apply. In addition, in relation to any Inland Revenue approved options, the Inland Revenue may agree other changes;

		(iii)	with effect from the release and grant, the Rules will where relevant be construed, in relation to the new option as if references to the Company and Shares were references to the Acquiring Company and shares for which the new option is granted.

	7.10	Loss of ownership:

Where the Optionholder is deprived of the legal or beneficial ownership of the Option by operation of law, or does anything or omits to do anything which causes him to be so deprived or becomes bankrupt, all his Options will lapse.

	7.11	Transfers:

If an Optionholder is transferred to work in another country, but still continues to hold an office or employment with a Member of the Group and, as a result of that transfer, the Optionholder may either:

		7.11.1	suffer a tax disadvantage in relation to his Options which was not anticipated on grant (this being shown to the satisfaction of the Committee); or

		7.11.2	become subject to restrictions on his ability to exercise his Options or to hold or deal in the Shares or the proceeds of the sale of the Shares acquired on exercise because of the security laws or exchange control laws of the country to which he is transferred;

the Optionholder may exercise the Option, irrespective of the satisfaction of any Exercise Condition, during the period starting 3 months before and ending 3 months after the transfer takes place. If he does not exercise his Options, following this Rule, the usual exercise Rules will apply to them at the appropriate times.

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	7.12	Priority:

If there is any conflict between any of the provisions of Rules 6 and 7, the provision which results in the shortest exercise period or the earliest lapse of the Option, or both, will prevail.

	8	Exchange Of Options

	8.1	Application:

This Rule applies if Options would become exercisable under Rules 7.3, 7.4, 7.5 or 7.6 but the Committee determines that the Options shall not be exercised but that this Rule 8 shall apply.

	8.2	Exchange:

Where the Committee has made a determination under Rule 8.1 Optionholders will be granted an option (“New Option”) to replace their Option (“Old Option”).

	8.3	Consequences of Exchange:

Where Optionholders are granted a New Option to replace their Old Option, then:

		8.3.1	the New Option will be in respect of shares in any body corporate determined by the Committee;

		8.3.2	the New Option will be equivalent to the Old Option;

		8.3.3	the New Option will be treated as having been acquired at the same time as the Old Option and be exercisable in the same manner and at the same time as the Old Option;

		8.3.4	the New Option will be subject to the provisions of the Plan as it had effect in relation to the Old Option immediately before the replacement;

		8.3.5	with effect from the replacement the Plan will be construed, in relation to the New Option as if references to Shares were references to the shares for which the New Option is granted and references to the Company were references to a company determined by the Committee at the time of replacement.

	9	Exercise Of Options

	9.1	Exercise:

An Optionholder can exercise his Option validly only in the way described in, and subject to, this Rule 9.

	9.2	Manner of Exercise:

Options must be exercised by notice in writing or in such other form (including e-mail or other electronic means) specified by the Committee and delivered to the person nominated by the Committee for this purpose. The notice of exercise of the Option must be completed and in the case of a written notice signed by the Optionholder or by his appointed agent, and must be accompanied by correct payment in full of the Option Price for the number of Shares being acquired or details of arrangements agreed between the Optionholder and the Company made for the payment of the Option Price for the number of Shares being acquired.

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	9.3	Option Exercise Date:

		9.3.1	Subject to Rule 9.3.2 the Option Exercise Date will be the later of:-

		(i)	the date of receipt by the person nominated by the Committee for this purpose of the documents and payment referred to in Rule 9.2; and

		(ii)	the date on which the Committee either decide that the Exercise Condition to which the Option is subject has been satisfied, or waive the Exercise Condition. The Committee must decide about the satisfaction or waiver of the Exercise Condition within 14 days of receiving the documents in Rule 9.2 and payment.

		9.3.2	If any statute, regulation or code adopted by the Company (based on the Model Code), prohibits the exercise of Options, or the Company Secretary reasonably believes it so prohibits, the date of exercise will be either the date described in Rule 9.3.1, or, if later, the date when the Optionholder is permitted or the Company Secretary believes the Optionholder is permitted to exercise an Option. However, this Rule does not extend any period in which an Option is exercisable.

	9.4	Part Exercise:

An Option may be exercised in part.

	9.5	Issue or Transfer:

Subject to Rule 9.7 (consents):

		9.5.1	Shares to be issued following the exercise of an Option will be issued within 30 days of the Option Exercise Date.

		9.5.2	The Committee will procure the transfer of Shares to be transferred following the exercise of an Option within 30 days of the Option Exercise Date.

	9.6	Rights:

		9.6.1	Shares issued on the exercise of an Option will rank equally in all respects with the Shares in issue on the date of allotment. They will not rank for any rights attaching to Shares by reference to a record date preceding the date of allotment.

		9.6.2	Where Shares are to be transferred on the exercise of an Option, Optionholders will be entitled to all rights attaching to the Shares by reference to a record date on or after the transfer date. They will not be entitled to rights before that date.

	9.7	Consents:

All allotments, issues and transfers of Shares will be subject to any necessary consents under any relevant enactments or regulations for the time being in force in the United Kingdom or elsewhere and the provisions of the deposit agreement between the Company and the depository. The Optionholder will be responsible for complying with any requirements to be fulfilled in order to obtain or avoid the necessity for any such consent.

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	9.8	Articles of Association:

Any Shares acquired on the exercise of Options will be subject to the Articles of Association of the Company from time to time in force. Any ADSs acquired upon the exercise of any Option shall, in addition, be subject to the terms of the deposit agreement between the Company and the depository.

	9.9	Listing:

If and so long as the Shares are listed on the Official List of the London Stock Exchange, the Company will where relevant apply for listing of any Shares issued under the Plan as soon as practicable after their allotment.

	9.10	Cash alternative:

The Committee may in its discretion determine not to procure the transfer or issue of Shares to an Optionholder who exercises his Option, but instead to pay to him (subject to Rule 10.10) a cash amount equal to the amount by which the market value (calculated in accordance with Rule 3.2 on the Option Exercise Date) of the Shares in respect of which the Option is exercised exceeds the Option Price, or to procure the transfer to him of Shares to the value of that cash amount or apply that amount in the issue of Shares. If the Committee so determines, the Option Price shall not be payable, and if already paid, shall be repaid to the Optionholder forthwith.

If an Optionholder so requests, the Committee may determine to satisfy the exercise of any Option with the appropriate number of ADSs. Any payment of taxes in respect of satisfying an Option in this way will be met by the Optionholder.

	10	General

	10.1	Notices:

Any notice or other document which has to be given to an Eligible Employee or Optionholder under or in connection with the Plan may be:

		10.1.1	delivered or sent by post to him at his home address according to the records of his employing company; or

		10.1.2	sent by e-mail (or other electronic means) or fax to any e-mail address or fax number which, according to the records of his employing company, is used by him;

or in either case such other address which the Company considers appropriate.

Any notice or other document which has to be given to the Company or other duly appointed agent under or in connection with the Plan may be delivered or sent by post to it at its respective registered office (or such other place as the Committee or the duly appointed agent may from time to time decide and notify to Optionholders) or at the discretion of the Committee sent by e-mail (or other electronic means) or fax to any e-mail address or fax number notified to the sender.

Notices sent by post will be deemed to have been given on the earlier of the date of actual receipt and the second day after the date of posting. However, notices sent by or to an Optionholder who is working overseas will be deemed to have been given on the earlier of the date of actual receipt and the seventh day after the date of posting.

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Notices sent by e-mail (or other electronic means) or fax, in the absence of evidence of non-delivery, will be deemed to have been received on the day after sending.

	10.2	Documents sent to Shareholders:

The Company may send to Optionholders copies of any documents or notices normally sent to the holders of its Shares (including such notices or documents required to be sent to Optionholders resident in the United States in accordance with the rules and regulations under the US Securities Act of 1934 as amended).

	10.3	Availability of Shares:

The Company will keep available for allotment sufficient unissued Shares for all Options under which Shares may be subscribed or will procure that sufficient Shares are available for transfer for all Options under which Shares may be acquired.

	10.4	Committee’s Decisions final and binding:

The decision of the Committee on the interpretation of the Rules or in any dispute relating to an Option or matter relating to the Plan will be final and conclusive.

	10.5	Costs:

The Company will pay the costs of introducing and administering the Plan.

	10.6	Regulations:

The Committee has the power from time to time to make or vary regulations for the administration and operation of the Plan but these must be consistent with the Rules.

	10.7	Terms of Employment:

Nothing in this Plan will in any way be construed as imposing on a Participating Company a contractual obligation as between the Participating Company and an Eligible Employee to offer participation in this Plan.

Any person who ceases to be an employee of any Member of the Group because of dismissal or termination of employment (however caused) or who is under notice of termination of employment will in no circumstances be entitled to claim any compensation in respect of the operation of the Plan including but not limited to the application of tax laws or the application of tax policies maintained by any Group Company. If necessary that person’s terms of employment will be varied accordingly.

	10.8	Replacement Option certificates:

If any option certificate is worn out, defaced or lost, the Committee may replace it on such conditions as it wishes to set. If an Option is exercised in part, and the balance remains exercisable, the Committee may on the surrender or cancellation of the relevant certificate provide the Optionholder with a balance certificate.

	10.9	Employee Trust

The Company and any Subsidiary of the Company may provide money to the trustee of any trust or any other person to enable them or him to acquire shares to be held for the purposes of the Plan, or enter into any guarantee or indemnity for those purposes, to the extent permitted by Section 153 of the Companies Act 1985.

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	10.10	Withholding

The Company, any employing company or the trustees of any employee benefit trust may withhold any amount and make any such arrangements, including but not limited to the sale or reduction in number of any Shares on behalf of an Optionholder as it considers necessary to meet any liability to taxation or social security contributions in respect of Options granted to the Optionholder pursuant to this Plan.

	10.11	Delegating

The Committee may delegate any or all of its powers to operate the Plan to a sub- committee provided that in the case of directors of the Company such a sub-committee consists of a non-executive director or non-executive directors of the Board of Directors of the Company.

	11	Changing the Plan and Termination

	11.1	Shareholder approval

		11.1.1	Except as described in Rule 11.1.2, the shareholders in general meeting must approve in advance by ordinary resolution any proposed change to the advantage of present or future Optionholders, which relates to the following:

		(i)	the persons to or for whom Shares may be provided under the Plan;

		(ii)	the limitations on the number of Shares which may be issued under the Plan;

		(iii)	the determination of the Option Price;

		(iv)	any rights attaching to the Options and the Shares;

		(v)	the rights of Optionholders in the event of a capitalisation issue, rights issue, sub-division or consolidation of shares or reduction or any other variation of capital of the Company;

		(vi)	the terms of this Rule 11.1.1.

		11.1.2	The Committee can change the plan and need not obtain the approval of the shareholder in general meeting for any minor changes including:

		(i)	to benefit the administration of the Plan;

		(ii)	to comply with or take account of the provisions of any proposed or existing legislation;

		(iii)	to take account of any changes to the legislation; or

		(iv)	to obtain or maintain favourable tax, exchange control or regulatory treatment of the Company, any Subsidiary or any present or future Optionholder.

	11.2	National Rules

Notwithstanding any other provision of the Plan, but subject always to Rule 11.1 the Committee may amend or add to the provisions of the Plan and the terms of Options as it considers necessary or desirable to take account of, or to mitigate, or to comply with relevant overseas laws including but not limited to taxation, securities or exchange control laws which apply to Eligible Employees provided that the terms of Options granted to such Eligible Employees are not more favourable overall than the terms of Options granted to other Eligible Employees.

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	11.3	Notice

As soon as possible after making any change, the Committee will give written notice to any Optionholder affected by the change.

	11.4	Termination of the Plan

The Committee may terminate the Plan at any time. If this is not done, the Plan will terminate on the tenth anniversary of its adoption by the shareholders in general meeting, but Options granted before such termination will continue to be valid and exercisable as described in these Rules.

	12	Governing Law

English law governs the Plan and all Options and their construction except as provided under Rule 11.2.

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BP Share Option Plan

Inland Revenue Approved Schedule

The rules of the BP Share Option Plan shall apply to Options granted under this Schedule, subject to the following alterations:

	1	Definitions

“Control” has the meaning given to it by Section 840 of the Taxes Act;

“Eligible Employee” does not include anyone who is excluded from participation because of paragraph 8 of Schedule 9 to the Taxes Act (material interests provisions). Any director is only eligible if required to devote to his duties not less than 25 hours per week (excluding meal breaks);

“Personal Representatives” means any person or persons who have obtained a valid UK grant of representation;

“Shares” must satisfy paragraphs 10 to 14 of the Taxes Act 1988; 

“Subsidiary” means a company which is:

		(i)	a subsidiary of the Company within the meaning given to it by Section 736 of the Companies Act 1985, and

		(ii)	under the Control of the Company; and

“Taxes Act” means the Income and Corporation Taxes Act 1988.

	2	Revenue Approval

If the approved status of the Plan is to be maintained, no change to the Plan made after it has been approved under Parts I, II and IV of Schedule 9 to the Taxes Act will have effect unless such change is approved by the Inland Revenue. In respect of the first operation of the Scheme no Options shall be granted until it has been approved by the Inland Revenue.

	3	Cash Alternative

Rule 9.10 shall not apply.

	4	Exercise Condition

Any Exercise Condition must be set out in documentation which is approved in advance by the Inland Revenue.

	5	Revenue limit

The Committee must not grant an Option to an Eligible Employee which would cause the market value of the Shares subject to the Option to exceed the amount permitted under paragraph 28(1) of Schedule 9 to the Taxes Act (currently £30,000). When considering whether this amount has been reached the Committee must take into account the market value of Shares subject to the Option which it intends to grant him, as well as the market value of shares which he may acquire on exercising his Options under the Plan or any other Inland Revenue approved scheme established by the Company or by any of its associated companies (as defined in Section 187 of the Taxes Act).

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	6	Adjustment of Options

No adjustment of Options may be made under Rule 5 without and to the extent of the prior approval of the Inland Revenue.

	7	Exchange of Options

The following rule shall replace Rule 8.

	7.1	This Rule applies if Options would become exercisable under Rule 7.3, 7.4, 7.5 or 7.6 but the Committee determines that Options shall not be exercised but this Rule shall apply.

	7.2	Where the Committee has made a determination under this Rule, optionholders will be granted an option (“New Option”) to replace their option (“Old Option”). The New Option will be granted within the appropriate period within the meaning of paragraphs 15(2) and Schedule 9 to the Taxes Act. The New Option must be equivalent to the Old Option within the meaning of Paragraph 15(3) of Schedule 9 to the Taxes Act. It will be over shares in a company falling within Paragraph 10 of Schedule 9 to the Taxes Act.

	7.3	Where an Optionholder is granted a New Option in substitution of his Old Option as described in this Rule, then:

		7.3.1	the New Option will be treated as having been acquired at the same time as the Old Option and be exercisable in the same manner and at the same time as the Old Option;

		7.3.2	the New Option will be subject to the provisions of the Plan as it had effect in relation to the Old Option immediately before the release. In addition, the Inland Revenue may agree other changes;

		7.3.3	with effect from the replacement the Plan will be construed, in relation to the New Option as if references to Shares were references to the shares for which the New Option is granted and references to the Company were references to a company determined by the Committee at the time of replacement.

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BP Share Option Plan

Schedule Governing Operation of the BP Share Option Plan in the United States

This United States (“US”) Schedule has been adopted by the Committee pursuant to Rule 11.2 of the Plan and shall vary the terms of the Plan (and any other related documents) accordingly.

Loss of Ownership

Rule 7.10 shall not apply.

Rule 10.10 and the heading thereof shall be amended by adding the following:

Rule 10.10 Withholding/Right of Offset:

Amounts withheld and/or collected as taxes shall also include hypothetical taxes owed under an expatriate tax policy (as currently in effect or as amended from time to time) (“Tax Policy”) of any Member of the Group. The Company or any employing company may deduct from the exercise of Options any debt, obligation, liability, or other amount owing by the Optionholder to a Member of the Group, including but not limited to amounts owed under a Tax Policy, as determined in the sole discretion of the Company. In accepting an Option grant, an Optionholder waives any right to notice and written consent under state law in connection with any such offset.

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BP Share Option Plan

Schedule Governing Options Granted

in March 1999 to Eligible Employees in Norway

This Schedule has been adopted by the Committee pursuant to Rule 11.2 of the Plan and shall vary the terms of the Plan (and any other related documents) accordingly.

Rule 9.10 Cash alternative

The following shall replace Rule 9.10:

9.10 Cash Alternative:

The Committee may in its discretion determine not to procure the transfer or issue of Shares to an Optionholder who exercises his Option, but instead to pay to him (subject to Rule 10.10) a cash amount equal to the amount by which the market value of the Shares in respect of which the Option is exercised (calculated by reference to the middle market quotation, as derived from the Daily Official List of the London Stock Exchange, of a Share on the Option Exercise Date) exceeds the Option Price, or to procure the transfer to him of Shares to the value of that cash amount or apply that amount in the issue of Shares. If the Committee so determines, the Option Price shall not be payable, and if already paid, shall be repaid to the Optionholder forthwith.

If an Optionholder so requests, the Committee may determine to satisfy the exercise of any Option with the appropriate number of ADSs. Any payment of taxes in respect of satisfying an Option in this way will be met by the Optionholder.

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Table of Contents

	
Contents

	
Page

	
 

	
 

	
 

	
1

	
Meanings Of Words Used

	
1

	
 

	
 

	
 

	
2

	
Grant Of Options

	
2

	
 

	
 

	
 

	
3

	
Option Price

	
4

	
 

	
 

	
 

	
4

	
Scheme Limits

	
4

	
 

	
 

	
 

	
5

	
Variations In Share Capital

	
5

	
 

	
 

	
 

	
6

	
Exercise And Lapse - General Rules

	
5

	
 

	
 

	
 

	
7

	
Exercise And Lapse - Exceptions to the General Rules

	
6

	
 

	
 

	
 

	
8

	
Exchange Of Options

	
10

	
 

	
 

	
 

	
9

	
Exercise Of Options

	
10

	
 

	
 

	
 

	
10

	
General

	
12

	
 

	
 

	
 

	
11

	
Changing the Plan and Termination

	
14

	
 

	
 

	
 

	
12

	
Governing Law

	
15

 

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