Document:

Exhibit 4.2

 

Sundance Employee Option Plan

 

	
MinterEllison
    	
 
    
	
 
    	
LAWYERS
    

 

 

Sundance Employee Option Plan

 

	
Plan Rules
    	
3
    
	
 
    	
 
    	
 
    
	
1.
    	
Introduction
    	
3
    
	
 
    	
 
    	
 
    
	
2.
    	
Defined terms and interpretation
    	
3
    
	
 
    	
 
    	
 
    
	
3.
    	
Principal conditions
    	
7
    
	
 
    	
 
    	
 
    
	
4.
    	
Operation of the Plan
    	
7
    
	
 
    	
 
    	
 
    
	
5.
    	
Offers
    	
7
    
	
 
    	
 
    	
 
    
	
6.
    	
Application for Options
    	
8
    
	
 
    	
 
    	
 
    
	
7.
    	
Issue of Options
    	
8
    
	
 
    	
 
    	
 
    
	
8.
    	
Exercise of Options
    	
9
    
	
 
    	
 
    	
 
    
	
9.
    	
Lapse of Options
    	
10
    
	
 
    	
 
    	
 
    
	
10.
    	
Dealings with Options
    	
10
    
	
 
    	
 
    	
 
    
	
11.
    	
Participation rights, bonus issues, rights issues,   reorganisations of capital and winding up
    	
11
    
	
 
    	
 
    	
 
    
	
12.
    	
Quotation of Shares
    	
12
    
	
 
    	
 
    	
 
    
	
13.
    	
Administration of the Plan
    	
13
    
	
 
    	
 
    	
 
    
	
14.
    	
Amendment to Rules
    	
14
    
	
 
    	
 
    	
 
    
	
15.
    	
Rights of Participants
    	
14
    
	
 
    	
 
    	
 
    
	
16.
    	
Notices
    	
14
    
	
 
    	
 
    	
 
    
	
17.
    	
Governing law
    	
14
    
	
 
    	
 
    	
 
    
	
18.
    	
Advice
    	
14
    

 

2

 

Plan Rules

 

1.                                   Introduction

 

1.1                            Name of Plan

 

The Plan is called the Sundance Employee Option Plan.

 

1.2                            Objects of Plan

 

The objects of the Plan are to:

 

(a)                               provide an incentive for Eligible Employees to remain in their employment in the long term;

 

(b)                               recognise the ongoing ability of Eligible Employees and their expected efforts and contribution in the long term to the performance and success of the Group; and

 

(c)                                provide Eligible Employees with the opportunity to acquire Options, and ultimately Shares, in the Company, in accordance with these Rules.

 

1.3                            Commencement of Plan

 

The Plan commences on the date determined by the Plan Committee.

 

2.                                   Defined terms and interpretation

 

2.1                            Defined terms

 

In these Rules, unless the context otherwise requires:

 

Accelerated Vesting Event means the occurrence of:

 

(a)                               a Special Circumstance in respect of a Participant; and

 

(b)                               a circumstance set out in Rule 10.3.

 

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

 

(a)                               the Corporations Act 2001 (Cth);

 

(b)                               Corporations Regulations;

 

(c)                                the Listing Rules;

 

(d)                               any other applicable securities laws;

 

(e)                               the constitution of the Company; and

 

(f)                                any practice note, policy statement, class order, declaration, guideline, policy or procedure authorising or entitling ASIC or ASX to regulate, implement or enforce, either directly or indirectly:

 

(i)                                  a provision of the laws, regulations, rules or constitution referred to in paragraphs (a) to (e); or

 

(ii)                               any agreement or deed made under the laws, regulations, rules or constitution referred to in paragraphs (a) to (e); or

 

(iii)                            a person’s conduct or proposed conduct under the laws, regulations, rules or constitution referred to in paragraphs (a) to (e), or any agreement or deed referred to in paragraph (f)(ii).

 

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Application Form means a duly completed and executed application for the issue of Options made by an Eligible Employee in respect of an Offer, in the form approved by the Plan Committee from time to time.

 

ASIC means the Australian Securities and Investments Commission.

 

ASX means Australian Stock Exchange Ltd ACN 008 624 691.

 

Board means all or some of the directors of the Company acting as a board or its delegate under Section 198D of the Corporations Act 2001 (Cth).

 

Certificate means, with respect to an Option:

 

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

 

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

 

(ii)                               the information in Rule 7.3.

 

Company means Sundance Energy Australia Limited ABN 76 112 202 883.

 

Corporations Regulations means any and all regulations made under the Corporations Act 2001 (Cth).

 

Date of Grant means, with respect to an Option, the date on which the Plan Committee grants the Option to an Eligible Employee.

 

Director means a director of the Company.

 

Eligible Employee means an Employee whom the Plan Committee determines is to receive an Offer under the Plan.

 

Employee means:

 

(a)                               an individual whom the Plan Committee determines to be in the full-time or part-time employment of a body corporate in the Group (including any employee on parental leave, long service leave or other special leave as approved by the Plan Committee);

 

(b)                               a director of a body corporate in the Group who holds a salaried employment or office in a body corporate in the Group;

 

(c)                                a director of the Company;

 

(d)                               an individual who provides services to a body corporate in the Group whom the Plan Committee determines to be an Employee for the purposes of the Plan;

 

(e)                                an individual whose associate (as that expression is defined in Section 139GE of the Income Tax Assessment Act 1936) provides services to a body corporate in the Group, which individual the Plan Committee determines to be an Employee for the purposes of the Plan; or

 

(f)                                 an individual otherwise in the employment of a body corporate in the Group whom the Plan Committee determines to be an Employee for the purposes of the Plan.

 

Exercise Conditions means the performance, vesting or other conditions (if any) determined by the Plan Committee and specified in an Offer which are, subject to these Rules, required to be satisfied, reached or met before an Option can, during the Exercise Period, be exercised.

 

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

 

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Exercise Price means the amount payable by the holder of an Option on the exercise of the Option, being the amount fixed at the time of the issue of the Option and as determined under Rule 5.5.

 

First Exercise Date with respect to an Option means, unless otherwise specified in an Offer, the earlier of:

 

(a)                               the vesting date applicable to the Option under Rule 8.3; or

 

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

 

Group means the Company and its Subsidiaries.

 

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

 

(a)                               the date which is one day before the tenth anniversary of the Date of Grant; or

 

(b)                               if a Special Circumstance arises in respect of a Participant prior to the date specified in paragraph (a), then the earlier of:

 

(i)                                  the date specified in paragraph (a); or

 

(ii)                               the date which is 12 months (or such longer period as may be determined by the Plan Committee) after the Special Circumstance arises.

 

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

 

Listing Rules means the listing rules of ASX.

 

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

 

Option means an option issued to a Participant under the Plan to subscribe for a Share.

 

Offer means an invitation to an Eligible Employee made by the Company under Rule 5.1 to apply for an issue of Options.

 

Participant means a person who holds Options issued under the Plan and includes, if a Participant dies or becomes subject to a legal disability, the Legal Personal Representative of the Participant.

 

Plan means the Employee Option Plan governed by these Rules.

 

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

 

Redundancy means the termination or cessation of a Participant’s employment or office with a body corporate in the Group as a result of redundancy, as determined by the Plan Committee.

 

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

 

Security Interest means a mortgage, charge, pledge, lien, encumbrance or other third party interest of any nature.

 

Shares means fully paid ordinary shares in the capital of the Company.

 

Special Circumstance means with respect to a Participant:

 

(a)                               Total and Permanent Disablement;

 

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(b)                               Redundancy;

 

(c)                                the death of the Participant;

 

(d)                               any other circumstances as the Plan Committee may at any time determine (whether in relation to the Participant, a class of Participants, particular circumstances or a class of circumstances) and whether before or after the Date of Grant.

 

Subsidiary means:

 

(a)                               a body corporate of which the Company is a holding company in terms of Division 6 of Part 1.2 of the Corporations Act 2001 (Cth) that the Plan Committee has approved for participation in the Plan; or

 

(b)                               a body corporate in which the Company has voting power of not less than 20% (determined under Section 610 of the Corporations Act 2001 (Cth)) that the Plan Committee has approved for participation in the Plan.

 

Tax includes any tax, levy, impost, GST, deduction, charge, rate, contribution, duty or withholding which is assessed (or deemed to be assessed), levied, imposed or made by any government or any governmental, semi-governmental or judicial entity or authority together with any interest, penalty, fine, charge, fee or other amount assessed (or deemed to be assessed), levied, imposed or made on or in respect of any or all of the foregoing.

 

Total and Permanent Disablement means the termination or cessation of a Participant’s employment with the Company or a Subsidiary as a result of total and permanent disablement, as determined by the Plan Committee.

 

2.2                            Interpretation

 

In these Rules, unless the context otherwise requires:

 

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

 

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

 

(c)                                words denoting the singular include the plural and vice versa;

 

(d)                               words denoting a gender include the other genders;

 

(e)                                reference to any document or agreement includes reference to that document or agreement as amended, novated, supplemented, varied or replaced from time to time;

 

(f)                                where any word or phrase is given a defined meaning in these Rules, any part of speech or other grammatical form of that word or phrase has a corresponding meaning;

 

(g)                               reference to a rule or paragraph is a reference to a rule or paragraph of these Rules, or the corresponding Rule or Rules of the Plan as amended from time to time; and

 

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

 

2.3                            Primary instruments

 

These Rules are to be interpreted subject to the Applicable Laws.

 

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3.                                   Principal conditions

 

3.1                            Plan limit

 

The number of ordinary shares in the capital of the Company acquired during the previous three years from new issues by the Company under the Plan and all other employee share schemes established by the Company (including as a result of exercise of options to acquire unissued  Shares granted under those employee share schemes), when aggregated with the number of Shares which would be acquired from new issues by the Company under all employee share schemes established by the Company were all outstanding options to acquire unissued Shares (issued pursuant to those employee share schemes) to be exercised, must not exceed 10% of the total number of issued Shares.

 

3.2                            Options issued only to Employees

 

No Options may be issued to a person under the Plan unless the person remains an Employee as at the Date of Grant, or the Plan Committee determines otherwise.

 

3.3                            Compliance with laws

 

No Option may be offered or issued to, or exercised by, an Eligible Employee or Participant if to do so would contravene an Applicable Law.

 

4.                                   Operation of the Plan

 

The Plan operates according to these Rules which bind the Company, any Subsidiary and each Participant.

 

5.                                   Offers

 

5.1                            Plan Committee may make Offer

 

Subject to these Rules, the Plan Committee may from time to time make an Offer to an Eligible Employee.

 

5.2                            Form of Offer

 

An Offer must be in writing and subject to Rule 5.3, the form of the Offer and any acceptance of the invitation constituted by the Offer must be as approved by the Plan Committee from time to time.

 

5.3                            Information contained in Offer

 

An Offer must state:

 

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

 

(b)                               the date of the Offer;

 

(c)                                the period for acceptance of the invitation constituted by the Offer;

 

(d)                               the maximum number of Options for which the Eligible Employee may make application;

 

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

 

(f)                                the expected First Exercise Date of the Options the subject of the Offer;

 

(g)                                the expected Last Exercise Date of the Options the subject of the Offer;

 

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

 

(i)                                   the Exercise Conditions (if any) attaching to the Options the subject of the Offer; and

 

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(j)                                  any other specific terms and conditions applicable to the Offer.

 

5.4                            Number of Options

 

Subject to Rule 3.1, the number of Options the subject of an Offer to an Eligible Employee is as determined by the Plan Committee.

 

5.5                            Exercise Price

 

Subject to any adjustment under Rule 11, the Exercise Price in respect of an Option is as determined by the Plan Committee.

 

5.6                            Exercise Price in Australian dollars

 

The Exercise Price in respect of an Option must be denominated and payable in Australian dollars.

 

5.7                            Offer personal

 

An Offer under the Plan is personal to the Eligible Employee to whom it is made and, accordingly, the invitation constituted by an Offer may only be accepted by, and Options may only be issued to, the Eligible Employee to whom the Offer is made.

 

6.                                   Application for Options

 

6.1                            Acceptance of Offer

 

An Eligible Employee may accept the invitation constituted by an Offer by giving to the Company an Application Form within the period specified in the Offer.

 

6.2                            Application for all or some of Options

 

An Eligible Employee may in his or her discretion accept the invitation constituted by an Offer, in whole or in part, in multiples of 100 Options or another multiple of Options as the Plan Committee may allow for the Eligible Employee.

 

6.3                            Lapse of Offer

 

An Offer not accepted in accordance with Rule 6.1 lapses unless the Plan Committee determines otherwise.

 

7.                                   Issue of Options

 

7.1                            Acceptance of application and issue

 

The Company may, within 60 days after receiving a duly completed Application Form from an Eligible Employee but subject to the conditions of the Offer:

 

(a)                               accept the Application Form;

 

(b)                               issue to the Eligible Employee all of the Options the subject of the Application Form; and

 

(c)                                notify the Eligible Employee of the Date of Grant of those Options.

 

7.2                            Eligible Employee becomes a Participant

 

On the issue of an Option following receipt by the Company of an Application Form, an Eligible Employee becomes a Participant and is bound by these Rules.

 

8

 

7.3                            Certificates

 

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

 

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

 

(b)                               the Exercise Price of those Options; and

 

(c)                                the Date of Grant of those Options.

 

7.4                            Consideration for Options

 

Options will be issued for consideration comprising the services that are expected to be provided by an Eligible Employee to or for the benefit of the Group, but no further monetary or other consideration will be payable in respect of the issue of an Option.

 

7.5                            Entitlement to underlying Shares

 

Subject to these Rules, each Option confers on its holder the entitlement to subscribe for and be issued one fully paid Share at the Exercise Price.

 

7.6                            Interest in Shares

 

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

 

8.                                   Exercise of Options

 

8.1                            Exercise during Exercise Period

 

Subject to Rules 3.3, 8.2, 8.3 and 8.4, an Option may be exercised at any time during the Exercise Period for that Option.

 

8.2                            Exercise before Exercise Period

 

Subject to Rule 8.3, an Option may be exercised before the Exercise Period if permitted under Rules 10.4 or 11.5.

 

8.3                            Vesting dates

 

Unless otherwise specified in an Offer, the vesting dates (refer defined term of First Exercise Date) applicable to Options the subject of an Application Form are as follows:

 

(a)                               33.33% of the Options - the date that is the first anniversary of the Date of Grant of the Options;

 

(b)                               33.33% of the Options - the date that is the second anniversary of the Date of Grant of the Options; and

 

(c)                                33.33% of the Options - the date that is the third anniversary of the Date of Grant of the Options.

 

8.4                            Exercise Conditions

 

Subject to Rule 8.5, if the Offer in respect of an Option specifies any Exercise Conditions, the Option may not be exercised unless and until those Exercise Conditions have been satisfied, reached or met.

 

8.5                            Waiver of Exercise Conditions

 

The Plan Committee may, at its discretion, by notice to the Participant reduce or waive the Exercise Conditions attaching to Options in whole or in part at any time and in any particular case including due to Special Circumstance or another Accelerated Vesting Event.

 

9

 

8.6                            Exercise of Options

 

Subject to these Rules, Options which have not lapsed may be exercised by the Participant giving to the Company:

 

(a)                               a Notice of Exercise signed by the Participant;

 

(b)                               the Certificate for those Options; and

 

(c)                                a cheque payable to the Company (or another form of payment acceptable to the Board) in the amount of the product of the number of Options then being exercised by the participant and the Exercise Price.

 

8.7                            Issue of Shares

 

Subject to these Rules and the Listing Rules, on the exercise of an Option the Company must:

 

(a)                               procure the transfer of a Share; or

 

(b)                               issue and allot a Share.

 

8.8                            Clearance of Exercise Price

 

The Company is not obliged to issue Shares on exercise of Options until any cheque received in payment of the Exercise Price has been honoured on presentation.

 

8.9                            Exercise all or some Options

 

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

 

(b)                               The exercise by a Participant of only some of the Options held by the Participant does not affect the Participant’s right to exercise at a later date other Options held by the Participant (whether those other Options have the same First Exercise Date or otherwise).

 

8.10                     Replacement Certificate

 

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

 

8.11                     Shares rank equally

 

Unless otherwise provided in a Notice of Exercise, Shares issued on the exercise of Options rank equally with all existing Shares on and from the date of issue in respect of all rights issues, bonus share issues and dividends which have a record date for determining entitlements on or after the date of issue of those Shares.

 

9.                                   Lapse of Options

 

9.1                            Lapse of Options

 

An Option lapses on the Last Exercise Date.

 

10.                            Dealings with Options

 

10.1                     Options personal

 

Except where Options have been transferred under Rule 10.3, Options held by a Participant are personal to the Participant and may not be exercised by another person.

 

10

 

10.2                     No unauthorised disposal

 

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

 

10.3                     Permitted transfer of Options and Accelerated Vesting Events

 

Options may be transferred, by an instrument of transfer, in the following circumstances only:

 

(a)                               a transfer constituting the necessary transfer documents following an acceptance of an offer made under an off-market bid relating to Options;

 

(b)                               a transfer to a bidder on the sale of the Options under Division 3 of Part 6A.1 of the Corporations Act 2001 (Cth);

 

(c)                                a transfer to a 100% holder on the sale of the Options under Division 2 of Part 6A.2 of the Corporations Act 2001 (Cth);

 

(d)                               a transfer under Part 6A.3 of the Corporations Act 2001 (Cth) to a person entitled to acquire the Options under section 661A or 664A of the Corporations Act 2001 (Cth); or

 

(e)                                a transfer approved by the Board in those circumstances as may be determined by the Board.

 

10.4                     First Exercise Date brought forward

 

If an Accelerated Vesting Event occurs while a Participant is employed with the Group, the Board may, at its discretion:

 

(a)                               bring forward the First Exercise Date of all Options held by the Participant to a date determined by the Plan Committee; and

 

(b)                               waive or vary any Exercise Conditions in regard to an Option held by the Participant in accordance with Rule 8.5.

 

10.5                     Notice to Participants of change

 

If the Plan Committee determines to alter the First Exercise Date and Exercise Conditions under Rule 10.4, the Company:

 

(a)                               must within 14 days of the alteration give notice to each Participant affected by the Accelerated Vesting Event in respect of any Options held by the Participant; and

 

(b)                               may have to issue a replacement Certificate for the Options.

 

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

 

11.1                     New issues

 

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

 

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

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

 

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

 

11

 

11.2                     Bonus issues

 

If the Company makes (whether before or during the Exercise Period) a bonus issue of Shares or other securities to existing holders of Shares (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment) and no Share has been issued in respect of an Option before the record date for determining entitlements to the bonus issue, then the number of underlying Shares over which the Option is exercisable is increased by the number of Shares which the Participant would have received if the Participant had exercised the Option prior to such record date.

 

11.3                     Pro-rata issues

 

If the Company makes (whether before or during the Exercise Period) a pro-rata issue of Shares (except a bonus issue) to existing holders of Shares (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment) and no Share has been issued in respect of an Option before the record date for determining entitlements to the issue, the Exercise Price of the Option is reduced in accordance with the Listing Rules.

 

11.4                     Reorganisation of capital

 

If there is a reorganisation of capital of the Company (whether before or during the Exercise Period) then the rights of a Participant (including the number of Options to which each Participant is entitled and the Exercise Price) is changed to the extent necessary to comply with the Listing Rules applying to a reorganisation of capital at the time of the reorganisation.

 

11.5                     Winding up

 

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

 

11.6                     Fractions of Shares

 

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

 

11.7                     Calculations and adjustments

 

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

 

11.8                     Notice of change

 

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

 

12.                            Quotation of Shares

 

12.1                     No Quotation of Options

 

The Company will not seek official quotation of any Options.

 

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12.2                     Quotation of Shares

 

The Company must apply to ASX for quotation of Shares issued on exercise of Options if other Shares of the Company are officially quoted by ASX at that time.

 

13.                            Administration of the Plan

 

13.1                     Administration

 

The Plan is administered by the Plan Committee.

 

13.2                     Powers of the Plan Committee

 

The Plan Committee has power to:

 

(a)                               determine appropriate procedures and make regulations for the administration of the Plan which are consistent with these Rules;

 

(b)                               resolve conclusively all questions of fact or interpretation arising in connection with the Plan;

 

(c)                                terminate or suspend the operation of the Plan at any time, provided that the termination or suspension does not adversely affect or prejudice the rights of Participants holding Options at that time;

 

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

 

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

 

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

 

(g)                                make regulations for the operation of the Plan consistent with these Rules.

 

13.3                     Exercise of powers or discretion

 

Any power or discretion which is conferred on the Plan Committee or Board by these Rules may be exercised by the Plan Committee or Board in the interests or for the benefit of the Company, and the Plan Committee or Board is not, in exercising that power or discretion, under any fiduciary or other obligation to another person.

 

13.4                     Determinations

 

Where these Rules provide for a determination, decision, approval or opinion of the Plan Committee or Board, that determination, decision, approval or opinion may be made or given by the Plan Committee or Board (as applicable) in its absolute discretion.

 

13.5                     Expenses and costs

 

Subject to these Rules, the Company and its Subsidiaries must pay all expenses, costs and charges incurred in the administration of the Plan in the amounts and proportions as they shall agree.

 

13.6                     Tax

 

The Company is not responsible for any Tax which may become payable by a Participant in connection with the issue of Shares pursuant to an exercise of Options or another dealing by a Participant with the Options or Shares.

 

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14.                            Amendment to Rules

 

14.1                     Board may amend Rules

 

Subject to the Listing Rules, the Board may at any time amend any of these Rules, or waive or modify the application of any of these Rules in relation to a Participant.

 

14.2                     Consent of Participants

 

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

 

14.3                     Eligible Employees outside Australia

 

The Board may make any additions, variations or modifications to the Rules, in relation to the implementation of the Plan and the specific application of the Rules to Eligible Employees residing outside Australia.

 

15.                           Rights of Participants

 

15.1                     No conferred rights

 

These Rules:

 

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

 

(b)                               do not confer on a Participant the right to continue as an Employee;

 

(c)                                do not affect any rights which the Company or a Subsidiary may have to terminate the employment of a Participant; and

 

(d)                               may not be used to increase damages in an action brought against the Company or a Subsidiary in respect of that termination.

 

15.2                     Voting at general meetings

 

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

 

16.                            Notices

 

Notices may be given by the Company to Participants in any manner that the Plan Committee may from time to time determine.

 

17.                            Governing law

 

These Rules and the rights and obligations of Participants under the Plan are governed by the law of South Australia, Australia, and each Participant irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts of South Australia, Australia.

 

18.                            Advice

 

Eligible Employees should obtain their own independent advice at their own expense on the financial, taxation and other consequences to them of or relating to participation in the Plan.

 

14Exhibit 4.3

 

 

SUNDANCE ENERGY AUSTRALIA LTD

 

ACN 112 202 883

 

LONG TERM INCENTIVE PLAN — EXECUTIVES, DIRECTORS, EMPLOYEES AND CONSULTANTS

 

RESTRICTED SHARE UNITS

 

TERMS AND CONDITIONS

 

 

Table of Contents

 

	
1.
    	
Definitions   and Interpretation
    	
3
    
	
 
    	
 
    	
 
    
	
2.
    	
Awards
    	
6
    
	
 
    	
 
    	
 
    
	
3.
    	
Purpose of the   LTI Program
    	
6
    
	
 
    	
 
    	
 
    
	
4.
    	
General   description of the LTI Program
    	
7
    
	
 
    	
 
    	
 
    
	
5.
    	
RSUs
    	
7
    
	
 
    	
 
    	
 
    
	
6.
    	
Vesting
    	
8
    
	
 
    	
 
    	
 
    
	
7.
    	
Shares
    	
8
    
	
 
    	
 
    	
 
    
	
8.
    	
Participants
    	
9
    
	
 
    	
 
    	
 
    
	
9.
    	
Earning Period
    	
9
    
	
 
    	
 
    	
 
    
	
10.
    	
Maximum number   of RSUs and Grant of RSUs
    	
9
    
	
 
    	
 
    	
 
    
	
11.
    	
Determination   of the targets
    	
10
    
	
 
    	
 
    	
 
    
	
12.
    	
Requirement   for continued employment or service
    	
10
    
	
 
    	
 
    	
 
    
	
13.
    	
Termination of   employment or service
    	
10
    
	
 
    	
 
    	
 
    
	
14.
    	
Shareholder   rights attached to RSUs
    	
11
    
	
 
    	
 
    	
 
    
	
15.
    	
Claw back
    	
11
    
	
 
    	
 
    	
 
    
	
16.
    	
Administration   of the Program
    	
12
    
	
 
    	
 
    	
 
    
	
17.
    	
Amendments to   the Terms
    	
12
    
	
 
    	
 
    	
 
    
	
18.
    	
Rights of   Participant
    	
12
    
	
 
    	
 
    	
 
    
	
19.
    	
General
    	
13
    
	
 
    	
 
    	
 
    
	
20.
    	
Security   Interests
    	
15
    
	
 
    	
 
    	
 
    
	
21.
    	
Governing law   and jurisdiction
    	
15
    

 

 

Sundance Energy Australia Limited ACN 112 202 883

 

Terms and Conditions — RSUs

 

1.                                      Definitions and Interpretation

 

1.1                               Definitions

 

In these Terms, unless the contrary intention appears:

 

“Acceptance Form” means a duly completed and executed document of acceptance by a LTI Recipient of an Offer in a form approved by the Board from time to time.

 

“Associated Company” means any body which is a related body corporate under Section 50 of the Corporations Act.

 

“ASX” means ASX Limited ACN 008 624 691.

 

“Board” means the Board of Directors of the Company as constituted from time to time.

 

“Change in Control” means any circumstance where Control of the Company changes from that subsisting as at the Grant Date.

 

“Closed Period” has the same meaning as in the Company’s Securities Trading Policy.

 

“Company” means Sundance Energy Australia Limited ACN 112 202 883, or its successor.

 

“Control” means where a person:

 

(a)                                 owns beneficially, directly or indirectly, more than 50% of the Company’s issued voting securities;

 

(b)                                 has the ability to direct or cause the direction of the management and policies of the Company, whether through the ownership of voting securities, by contract or otherwise; or

 

(c)                                  otherwise controls the Company for the purposes of section 50AA of the Corporations Act.

 

“Corporations Act” means the Australian Corporations Act 2001 (Cth).

 

“Director” means a director of the Company or any Associated Company.

 

“Earning Period” means an earning period commencing on the first day of the Company’s Financial Year and ending on the last day of that Financial Year.

 

“Employee” means a person whom the Board determines to be in the full-time or part-time employment of a company in the Group as a potential LTI Recipient and for the purposes of these Terms each Director is deemed to be an Employee.

 

“Final Vesting Date” means the 3rd anniversary of the Grant Date.

 

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“Financial Year” currently means each year commencing on the first day of July and ending on the 30th day of June though, upon the adoption by the Company of a different Financial Year, will mean that newly adopted Financial Year.

 

“Governing Law” means all laws, regulations and stock exchange listing rules governing the Group, including the Corporations Act and the Listing Rules, and any applicable US laws and regulations including federal securities law.

 

“Grant Date” means the date set out in the Offer, which will be on or around the date of Board approval of the grant of RSUs.

 

“Group” means the Company and its Associated Companies.

 

“Interim Vesting Date” in relation to a Financial Year during the term of a RSU means the final day of that Financial Year.

 

“Listing Rules” means the official listing rules of the ASX.

 

“LTI” means long term incentive.

 

“LTI Recipient” means an Employee or other individual who has been selected by the Board to receive an Offer or who has been approved for participation in the LTI Program under the Plan.

 

“LTI Program” means the share incentive program which forms all or part (as applicable) of the equity component of the LTI established by the Company under the Plan and for the purposes of these Terms each Director is deemed to participate in the LTI Program.

 

“Market Price” means, in relation to the Company, the weighted average market price of a Share sold on the ASX during one week of trading days immediately before the close of the Financial Year for which the RSUs are granted, or where the Board determines that this price does not fairly and appropriately reflect the market value of the Company as at the close of that Financial Year, the market price of a Share on such other date or period that the Board considers appropriate, as determined by the Board in good faith and in its absolute discretion, having regard to arm’s length valuation principles and generally accepted valuation methodologies. The Company must ensure that any such price determined by the Board fairly and appropriately reflects the market value of the Company.

 

“Offer” means an offer of RSUs made in accordance with the Plan.

 

“Offer Period” means the time period for the acceptance of an Offer.

 

“Participant” means a LTI Recipient who accepts an Offer to participate in the Plan, agrees to be bound by the Rules and has been provided with RSUs under the LTI Program.

 

“Person” includes a body corporate and the trustee of a trust estate.

 

“Plan” means the Incentive Compensation Plan for Executives established by the Company on 6 April 2011, and operated in accordance with the Rules. The Board decided in a meeting held on 6 April 2011, to establish the Plan, which includes the LTI Program.

 

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“Qualifying Reason” means death, total and permanent disability, Redundancy, termination of the Employee without cause, or any other reason as determined by the Board in its absolute discretion.  For the avoidance of doubt, termination with cause means any right to immediate termination (including for the reasons of fraud, defalcation and/or gross misconduct in relation to the affairs of the Company or any Associated Company (whether or not charged with an offence) or doing any act which in the opinion of the Board brings the Company or any Associated Company into disrepute) and also includes sustained performance below expectations by the Employee.

 

“Redundancy” means the termination of the employment of the Employee by the Company or an Associated Company by reason of the relevant position of employment no longer being required or as part of a restructure or reduction in the Management or organisational structure of the Company or the Associated Company.

 

“RSU” means a restricted share unit each carrying a right to receive one Share issued under these Terms.

 

“Rules” means the rules governing the Plan, as amended from time to time.

 

“Section 409A” means as defined in clause 19.10.

 

“Security Interest” means a mortgage, charge, pledge, lien or other encumbrance of any nature.

 

“Settlement Date” means as defined in clause 7.2.

 

“Share” means a fully paid Ordinary Share in the capital of the Company which ranks equally with and has the same rights as other fully paid Ordinary Shares in the capital of the Company.

 

“Terms” means these terms and conditions of the RSUs.

 

“Termination of Employment” means the termination or cessation of employment or the holding of an office with the Company or any Associated Company (other than for the purposes of re-employment with any other company in the Group) of a Participant.

 

“Vesting Date” means each date on which one or more RSUs vest in accordance with these Terms.

 

1.2                               Interpretation

 

In these Terms, unless the contrary intention appears:

 

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

 

(b)                                 words denoting the singular include the plural and vice versa;

 

(c)                                  words denoting a gender include other genders;

 

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(d)                                 words denoting an individual or persons include bodies corporate and trusts and vice versa;

 

(e)                                  headings are for convenience only and do not affect the interpretation of these Terms;

 

(f)                                   reference to a clause or paragraph is a reference to a clause or paragraph of these Terms, or the corresponding Term or Terms of the RSUs under the Plan as amended from time to time;

 

(g)                                  reference to any document or agreement includes reference to that document or agreement as amended, novated, supplemented, varied or replaced from time to time; and

 

(h)                                 where any word or phrase is given a definite meaning in these Terms, any part of speech or other grammatical form of that word or phrase has a corresponding meaning.

 

2.                                      Awards

 

2.1                               At its sole discretion, the Board may grant you an award of RSUs, in accordance with the LTI equity component of the Company’s Plan; the Plan comprises both LTI and Short Term Incentive components.

 

2.2                               RSUs will be granted by the Company under the LTI Program established under the Plan as part of your LTI bonus, and in consideration of, and subject to your performance of, services to the Group, as a Director of the Company, executive or employee of, or consultant to, the Group.

 

2.3                               These Terms set out the general terms and conditions of the RSUs.

 

2.4                               The RSUs and the LTI Program are expressly subject to these Terms, the Plan and any additional terms and conditions the Board in its absolute discretion may elect to include in an Offer.  If you receive or have received any other award under the Plan, or any other equity compensation plan for any year, it will be governed by the terms and conditions of the applicable award or equity compensation, which may be different from these Terms.

 

2.5                               By accepting a grant of RSUs, you expressly agree to these Terms and the Plan, and any applicable Rules.

 

2.6                               Capitalised terms used in these Terms that are not defined in the text have the meanings set out in clause 1 above, or in the Plan.

 

3.                                      Purpose of the LTI Program

 

3.1                               The LTI Program’s objectives are to reward Directors of the Company, executives, and employees of, and consultants to, the Group (potential LTI Recipients) for achieving the Group’s long term goals, to align the interests of LTI Recipients and shareholders, to attract and retain potential LTI Recipients, and to form part of a competitive incentive package.

 

3.2                               The purpose of the LTI Program is to direct LTI Recipients’ attention to achieving the Company’s financial targets, and increasing the Company’s shareholder value. The

 

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LTI Program provides potential LTI Recipients with the opportunity to receive LTI awards under the Plan in the form of RSUs.

 

3.3                               You may only receive RSUs under the LTI Program where you have earned an LTI award under the Plan after achieving targets and objectives under the Plan.

 

3.4                               RSUs do not confer upon you any right, entitlement or interest in Shares in the Company or any Associated Company or any option to acquire Shares in the Company or shares in any Associated Company, other than in accordance with these Terms.

 

3.5                               The manner in which RSUs will be granted to you is set out in these Terms.

 

3.6                               In the case of a non-executive director, the Board in its absolute discretion may grant RSUs:

 

(a)                                 solely to attract or retain that director or both; or

 

(b)                                 as part of that director’s remuneration package,

 

and for the purposes of these Terms that director will be deemed to have achieved targets and objectives under the Plan and to have earned an LTI award under the Plan.

 

4.                                      General description of the LTI Program

 

4.1                               The LTI Program will continue to operate until the Board in its absolute discretion decides to amend or terminate it. The Remuneration Committee will review the LTI Program at least annually, and report its findings to the Board. The first Earning Period will commence on 1 July 2010, and end on 30 June 2011, and will proceed from there on a Financial Year basis.

 

4.2                               The LTI Program offers the possibility of receiving Shares as an incentive, via the settlement of RSUs granted to you, if your targets set for the Earning Period are achieved.

 

4.3                               The Board will decide your maximum number of RSUs, in accordance with clause 10.  The actual number of RSUs awarded to you will be determined by reference to the level of achievement of your targets set for the Earning Period.

 

4.4                               The Board in its absolute discretion may make a written offer to grant RSUs to some or all potential LTI Recipients each year in accordance with the LTI Program, setting out the maximum number of RSUs proposed to be granted on these Terms.  Any such offer will be made as soon as reasonably practicable after the end of the previous Financial Year.

 

5.                                      RSUs

 

5.1                               The number of RSUs which may be granted to you pursuant to these Terms under the LTI Program will be communicated to you in writing, in accordance with clause 4.4.

 

5.2                               Each RSU gives you the unsecured right to receive, subject to these Terms, one Share in the future at a time determined in accordance with clause 7.2.

 

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5.3                               You will not be required to pay any consideration for the issue of the Shares on settlement of your RSUs.

 

5.4                               The Board, in its sole and absolute discretion, may grant an award of RSUs subject to such additional terms and conditions as determined by the Board and set forth in the Acceptance Form.

 

6.                                      Vesting

 

6.1                               Subject to your continuous employment with, or other service to, the Group (as determined by the Board in its absolute discretion), the Rules and these Terms, and except as otherwise provided in your Acceptance Form, the RSUs will vest in four equal annual tranches, beginning on the Grant Date and ending on the third anniversary of the Grant Date, as follows.

 

	
Tranche
    	
 
    	
Vesting Date
    
	
Tranche 1 (25%)
    	
 
    	
Grant Date
    
	
Tranche 2 (25%)
    	
 
    	
1st anniversary of the   Grant Date
    
	
Tranche 3 (25%)
    	
 
    	
2nd anniversary of the   Grant Date
    
	
Tranche 4 (25%)
    	
 
    	
3rd anniversary of the   Grant Date
    

 

6.2                               Any fractional Shares resulting from the application of the vesting schedule referred to in clause 6.1 will be aggregated, and the Shares resulting from such aggregation will vest on the first anniversary of the Grant Date.

 

6.3                               Each date on which one or more RSUs vest in accordance with these Terms is referred to as a Vesting Date.

 

7.                                      Shares

 

7.1                               Each RSU will be fully satisfied by the issue of one Share.

 

7.2                               Subject to clauses 7.3 and 7.5 below, prior vesting and your compliance with these Terms and the Plan, settlement of each Share will occur on the 60th day following the Vesting Date or any earlier date determined by the Board in its absolute discretion (the Settlement Date).

 

7.3                               If the scheduled Settlement Date falls within a Closed Period, the Board will extend that Settlement Date to a date no later than 5 business days after the end of the Closed Period, or with your approval to a later date. If you do not wish the Board to extend the Settlement Date, then before the Board does so you must:

 

(a)                                 request the Board in writing not to extend the Settlement Date; and

 

(b)                                 provide payment in cash or check acceptable to the Company prior to that Settlement Date to satisfy the supplemental taxable income withholding obligations, in accordance with clause 19.9 below.

 

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7.4                               It is acknowledged that any extension of the Settlement Date under clause 7.3 is intended to benefit Participants and facilitate administration of the Plan, since in the usual course some of the Shares will need to be sold on the Settlement Date to satisfy the supplemental taxable income withholding obligations, and except in limited circumstances the Participants cannot sell Shares during a Closed Period. Refer to clause 19.9 below.

 

7.5                               If the scheduled Settlement Date falls outside a Closed Period, and despite this either the Company’s Securities Trading Policy or Australian law or both do not permit any of your Shares to be sold on the scheduled Settlement Date to satisfy the supplemental taxable income withholding obligations, you may request the Board in writing to extend the Settlement Date to a date no later than 5 business days after this restriction ends and the Shares are permitted to be sold. The Board may do so in its discretion, provided that the Board is satisfied that:

 

(a)                                 your Shares are not permitted to be sold on the scheduled Settlement Date to satisfy the supplemental taxable income withholding obligations;

 

(b)                                 the request is made in good faith; and

 

(c)                                  it is reasonable in the circumstances to extend the Settlement Date, having regard to any hardship to you that might arise, if you were required to provide payment in cash or check acceptable to the Company prior to that scheduled Settlement Date to satisfy the supplemental taxable income withholding obligations, in accordance with clause 19.9 below.

 

7.6                               You will continue to be bound by the Company’s Securities Trading Policy, and participation in the Plan will not affect or alter your obligations under that Securities Trading Policy.

 

8.                                      Participants

 

8.1                               The Board, in its absolute discretion, will determine who can participate in the LTI Program.

 

8.2                               Participation in the LTI Program will not affect or alter the terms of your employment.

 

9.                                      Earning Period

 

Each LTI Program Earning Period commences on the first day of the Company’s Financial Year and ends on the last day of that same Financial Year.

 

10.                               Maximum number of RSUs and Grant of RSUs

 

10.1                        The Board decides, in its absolute discretion, the maximum number of RSUs for each Financial Year by dividing the value of your LTI award under the Plan by the Market Price of the Shares, in accordance with the Plan and subject to any exceptions set out in the Plan, as follows:

 

 

9

 

10.2                        The Board will provide you with notice of the number of RSUs you have been granted, subject to these Terms, including your continued employment with, or service to, the Group.

 

10.3                        Generally, the Board will award grants of RSUs pursuant to this LTI Program within 4 months of the end of the relevant Financial Year with respect to the Plan, unless the Board in its absolute discretion determines that additional time is required to make this decision.

 

11.                               Determination of the targets

 

Under the Plan, the Board, in its absolute discretion, will determine the performance targets applicable during the Earning Period, as well as the principles for determining whether the targets have been achieved and how they translate into RSUs to be granted under this LTI Program on an annual basis.

 

12.                               Requirement for continued employment or service

 

12.1                        The Board will determine, in its absolute discretion, who the potential LTI Recipients of the Group are.

 

12.2                        Subject to clause 13, if your employment or other service in the Group has terminated before the applicable Vesting Date of the RSUs, those unvested RSUs will be forfeited, and you will not be issued Shares or any other compensation or benefit in relation to the forfeited RSUs.

 

12.3                        Your right to RSUs is personal to you, and RSUs are to be allotted, if at all, only to you.

 

12.4                        Your right to RSUs cannot be transferred.

 

13.                               Termination of employment or service

 

13.1                        Where you cease to be employed by, or otherwise providing services to, the Company or an Associated Company before the Final Vesting Date due to a Qualifying Reason:

 

(a)                                 vested RSUs as at the date of termination will be satisfied by the issue to you (or to your heirs and devisees in the event of your death) of one Share for each vested RSU, within 60 days of the termination of your employment or services; and

 

(b)                                 any unvested RSUs at the date of termination will be forfeited, subject to the Board exercising its discretion in accordance with clause 13.2 to deem some or all of those unvested RSUs to be vested and compliance with clauses 19.8 - 19.10 below (Section 409A), in which case any such deemed vested RSUs will be satisfied by the issue to you (or to your heirs and devisees in the event of your death) of one Share for each such deemed vested RSU, within 90 days of the termination of your employment or services.

 

13.2                        For the purposes of clause 13.1(b), when determining whether any unvested RSUs at the date of termination should be either deemed to be vested or forfeited subject to compliance with clauses 19.8 to 19.10 below (Section 409A) the Board must act in good faith, and have regard to:

 

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(a)                                 your length of employment by, or service to, the Company or any Associated Company, and contribution to the Company or any Associated Company;

 

(b)                                 the circumstances of the termination of your employment by, or service to, the Company;

 

(c)                                  the date when the RSUs would have vested if your employment or service had not been terminated;

 

(d)                                 the interests of the Company or any Associated Company; and

 

any other matters the Board considers relevant to the exercise of its discretion.

 

13.3                        Where you cease to be employed by, or otherwise providing services to the Company or an Associated Company before the Final Vesting Date other than for a Qualifying Reason:

 

(a)                                 vested RSUs as at the date of termination will be satisfied by the issue to you of one Share for each vested RSU, within 60 days of the termination of your employment; and

 

(b)                                 any unvested RSUs at the date of termination will be forfeited.

 

14.                               Shareholder rights attached to RSUs

 

14.1                        You will have no rights as a shareholder with respect to any Shares until the Settlement Date of those Shares. You are not entitled to participate in any new issue to existing shareholders in the Company unless your RSUs have vested before the record date for determining entitlements to the new issue of securities, and been satisfied by the issue to you of Shares, and you participate as a result of holding Shares.

 

14.2                        From the Settlement Date of your Shares, you will have all rights as a shareholder, including the right to receive dividends and capital repayments, with respect to the Shares.

 

15.                               Claw back

 

The Board, in its discretion (which discretion must be exercised in good faith), reserves the right to claw back and cancel without compensation any RSUs issued under these Terms, whether vested or unvested, if any of the following conditions apply prior to the Settlement Date applying to the RSUs concerned:

 

(a)                                 the Company’s financial statements are required to be restated due to material non-compliance with any financial reporting requirements under Governing Law (other than a restatement due to a change in accounting rules) and:

 

(i)                                     as a result of such restatement, a performance measure which was a material factor in determining the award is restated; and

 

(ii)                                  in the opinion of the Board, a lower number of RSUs would have been granted to you based upon the restated financial results;

 

11

 

(b)                                 should it subsequently be found that the information or assumptions relied on by the Board in determining the award of RSUs to you under the Plan are materially erroneous;

 

(c)                                  in the event that there is evidence of fraud by any employee resulting in a material adverse change to the Company’s financial statements; or

 

(d)                                 in the event that there is a material adverse change in the circumstances of the Company.

 

16.                               Administration of the Program

 

16.1                        The Board shall administer and monitor the LTI Program and decide on all disputes or other matters relating to the LTI Program. The Board, in its absolute discretion, reserves the right to accelerate vesting of all or any portion of outstanding RSUs granted to any Participant for any reason. The Board need not take the same action with respect to all Participants or all RSUs held by any Participant.

 

16.2                        Where the Terms provide for a determination, decision, approval or opinion of the Board, such determination, decision, approval or opinion of the Board shall be in its absolute discretion, subject to any express obligation to act in good faith set out in these Terms.

 

16.3                        Any power or discretion which is conferred on the Board by these Terms may be exercised by the Board in the interests or for the benefit of the Company, and the Board is not, in exercising any such power or discretion, under any fiduciary or other obligation to any other person, subject to any express obligation to act in good faith set out in these Terms.

 

16.4                        The decision of the Board as to the interpretation, effect or application of these Terms will be final.

 

16.5                        The Board may delegate such functions and powers as it may consider appropriate, for the efficient administration of the LTI Program, to a committee made up of persons capable of performing those functions and exercising those powers.

 

16.6                        The Board may take and rely upon independent professional or expert advice in or in relation to the exercise of any of its powers or discretions under these Terms.

 

17.                               Amendments to the Terms

 

17.1                        The Board shall be entitled to amend these Terms, the LTI Program, the Plan and the Rules during any Earning Period subject to all applicable laws, rules and regulations.

 

17.2                        Any change of these Terms will not materially affect or prejudice RSUs provided to Participants at or before that time, unless approved by the affected Participants.

 

18.                               Rights of Participant

 

Nothing in these Terms:

 

(a)                                 confers on any Participant the right to continue as an Employee of, or consultant to, the Company or any Associated Company;

 

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(b)                                 affects any rights which the Company or any Associated Company may have to terminate the employment or office of any Employee of, or consultant to, the Company or any other potential LTI Recipient; or

 

(c)                                  may be used to increase damages in any action brought against the Company or any Associated Company in respect of any such termination.

 

19.                               General

 

19.1                        The rights of the Participants with respect to RSUs and these Terms are subject to the Rules, the Plan, the Company’s Constitution, the Corporations Act and, where appropriate, the Listing Rules.

 

19.2                        If, at any time while RSUs are held by Participants, the issued capital of the Company is reorganised in any way, or the Company makes a bonus issue of Shares or pro rata issue of Shares or other issue of securities, the rights of the Participants may be varied either to:

 

(a)                                 comply with the ASX Listing Rules or other applicable rules which apply to the reconstruction or issue at the time of the reconstruction or issue; or

 

(b)                                 ensure that the Participants will neither be unfairly disadvantaged as a result nor receive a benefit that the holders of Shares do not receive,

 

or both.

 

19.3                        If:

 

(a)                                 a takeover bid is made to acquire Shares in the Company, then at any time offers under a takeover bid remain open for acceptance; or

 

(b)                                 any other Change in Control occurs, then prior to the consummation of the Change in Control transaction,

 

the Board in its absolute discretion may give written notice of the bid to the holders of RSUs, stating that:

 

(c)                                  all or any unvested RSUs, as determined by the Board, will vest and be fully satisfied by the issue of one Share each, on any date determined by the Board; and

 

(d)                                 in accordance with clause 7.2, the Settlement Date of all or any vested RSUs, as determined by the Board, will be an earlier date than the 60th day following the Vesting Date.

 

In connection with a takeover bid or any other Change in Control, the Board in its absolute discretion may also provide for the cancellation of outstanding RSUs and a cash payment equal to the then fair market value of the RSUs immediately prior to the closing of the Change in Control transaction.  In connection with any other corporate event (except a Change in Control), the Board in its absolute discretion may provide for the assumption or substitution of outstanding RSUs.

 

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19.4                        Any calculations or adjustments that are required to be made under this clause 19 will be made by the Board and will, in the absence of manifest error, be final and conclusive and binding on the Company and the Participants.

 

19.5                        The LTI Program must operate in accordance with these Terms and the Rules which bind the Company, each Associated Company, and each LTI Recipient and Participant.

 

19.6                        Notwithstanding any Term or Rule, no RSU, Share or remuneration benefit (including, but not limited to, any termination benefit) may be provided if to do so would contravene any Governing Law including, without limitation, the Corporations Act or the Listing Rules.

 

19.7                        The Company must pay all the expenses, costs and charges incurred in operating the LTI Program and the Plan.

 

19.8                        As a Participant you have sole responsibility for:

 

(a)                                 paying any related personal income taxation, withholding tax, other taxation liability, social security contributions or other taxes or charges related to your LTI grant; and

 

(b)                                 complying with all social security and other reporting obligations,

 

in accordance with the Governing Law applicable to you in relation to the LTI Program. You should consult your own tax adviser regarding the tax consequences of participating in the LTI Program. You will need to consider your own circumstances, in light of the benefit that you are likely to receive under the LTI Program.

 

19.9                        Notwithstanding the foregoing, unless the Participant provides payment in cash or check acceptable to the Company prior to each Settlement Date, the Company shall automatically withhold the number of whole Shares otherwise deliverable to the Participant with a value at the conversion date equal to the minimum statutory withholding rates for federal, state, and local income taxes and employment taxes applicable to supplemental taxable income withholding obligations, or the Company shall make alternative arrangements for that number of whole Shares to be sold to satisfy those supplemental taxable income withholding obligations, which may include arranging for the Participant to sell that number of whole Shares on behalf of the Company and irrevocably authorise and direct that the proceeds be paid to the Company or the Company’s nominee, on terms acceptable to the Company.  The Participant shall promptly pay to the Company any remaining amount required to be withheld.

 

19.10                 To the extent applicable, the grant, vesting and settlement of RSUs awarded to any Participant are intended to satisfy the short-term deferral exception for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (Section 409A).  To the extent required for compliance with Section 409A, RSUs granted under the LTI Program shall be interpreted and administered to the maximum extent possible to comply with Section 409A, including a six month delay in payment to “specified employees” payable on account of a “separation from service” each as determined under Section 409A.

 

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19.11                 The Company or the Associated Company (as applicable) shall be entitled to deduct any withholding required or imposed by Governing Law, including without limitation  Pay As You Go tax instalments, from any bonus remuneration payments or benefits provided by the Company or the Associated Company to or in respect of a Participant. For the avoidance of doubt, the Company is under no obligation to pay any taxation liability, social security contribution or other tax or charge incurred by any Participant in relation to the LTI Program, which will remain the sole responsibility of the Participant.

 

19.12                 For the sole purpose of calculating the remuneration of non-executive directors per annum in accordance with clause 62 of the Company’s Constitution, the value of grants of RSUs and any Shares issued in satisfaction of RSUs will be determined either by:

 

(a)                                 reference to the valuation ascribed to those RSUs and Shares in the Company’s remuneration report in its Annual Report for that year (being the Company’s financial year); or

 

(b)                                 any other reasonably appropriate valuation methodology,

 

and disregarding the value of any RSUs and Shares which have been taken into account by the Company under clause 62 in relation to an earlier Financial Year.

 

20.                               Security Interests

 

Participants must not and cannot grant any Security Interest in or over or otherwise dispose or deal with any RSUs or any interest in any RSU, and any such Security Interest or disposal or dealing will not be recognised in any manner by the Company.

 

21.                               Governing law and jurisdiction

 

This LTI Program and the RSUs provided to the Participants under the Terms will be governed by the laws of the State of South Australia, subject as necessary to any applicable US laws and regulations including federal securities law.

 

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