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Exhibit 4.3    
    

 
 

INVESTORS' RIGHTS AGREEMENT    
    

 
 

January 10, 2005    
    

 
 
 

Table of Contents    
    

	 
	 	 
	 
	 	Page

	1.	 	Registration Rights	 	3
	 	 	1.1.	Definitions	 	3
	 	 	1.2.	Request for Registration	 	4
	 	 	1.3.	Company Registration	 	5
	 	 	1.4.	Obligations of the Company	 	6
	 	 	1.5.	Furnish Information	 	7
	 	 	1.6.	Expenses of Demand Registration	 	7
	 	 	1.7.	Expenses of Company Registration	 	7
	 	 	1.8.	Underwriting Requirements	 	8
	 	 	1.9.	Delay of Registration	 	8
	 	 	1.10.	Indemnification	 	8
	 	 	1.11.	Reports Under Securities Exchange Act of 1934	 	10
	 	 	1.12.	Form F-3 Registration	 	10
	 	 	1.13.	Assignment of Registration Rights	 	12
	 	 	1.14.	"Market Stand-Off" Agreement	 	12
	 	 	1.15.	Termination of Registration Rights	 	12
	

2.	
 	

Covenants of the Company	
 	

13
	 	 	2.1.	Delivery of Financial Statements	 	13
	 	 	2.2.	Inspection	 	13
	 	 	2.3.	Termination of Information and Inspection Covenants	 	14
	 	 	2.4.	Right of First Refusal on Dispositions	 	14
	 	 	2.5.	Drag-Along Rights	 	15
	

3.	
 	

Miscellaneous	
 	

15
	 	 	3.1.	Successors and Assigns	 	15
	 	 	3.2.	Governing Law	 	16
	 	 	3.3.	Counterparts	 	16
	 	 	3.4.	Titles and Subtitles	 	16
	 	 	3.5.	Notices	 	16
	 	 	3.6.	Expenses	 	17
	 	 	3.7.	Amendments and Waivers	 	17
	 	 	3.8.	Severability	 	17
	 	 	3.9.	Entire Agreement	 	17

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INVESTORS' RIGHTS AGREEMENT    
    

        THIS INVESTORS' RIGHTS AGREEMENT is made as of the 10th day of January, 2005, by and among Gentium S.p.A., a joint stock company
(società per azioni) incorporated and organized under the laws of the Republic of Italy (the "Company"), on the one hand, and Alexandra
Global Master Fund Ltd., a British Virgin Islands company ("Alexandra") and Generation Capital Associates, a New York limited partnership ("Generation", each of Alexandra and Generation, an
"Investor"), on the other hand. 

RECITALS  

        WHEREAS, Alexandra has purchased shares of common stock of the Company from FinSirton S.p.A. (the "Majority Shareholder") pursuant to the terms of a stock
purchase agreement, dated January 10, 2005 (the "Alexandra Stock Purchase Agreement"), and Generation has purchased shares of common stock of the Company from the Majority Shareholder pursuant
to the terms of a stock purchase agreement, dated January    , 2005 (the "Generation Stock Purchase Agreement," and together with the Alexandra Stock Purchase Agreement, the "Stock Purchase
Agreements"); 

        WHEREAS,
the net proceeds of the sale of shares by FinSirton under the Stock Purchase Agreements will be contributed to the Company; 

        WHEREAS,
in order to induce the Investors to enter into the transactions contemplated by the Stock Purchase Agreements, the Investors and the Company herby agree that this Agreement
shall govern the rights of the Investors to cause the Company to register the shares of Common Stock purchased pursuant to the Stock Purchase Agreements and certain other matters as set forth herein; 

        NOW,
THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS: 

        1.    Registration Rights.    The company covenants and agrees as follows: 

        1.1    Definitions.    For purposes of this Agreement: 

        (a)   The
term "Act" means the Securities Act of 1933, as amended. 

        (b)   The
term "Common Stock" means the common stock, par value €1 per share, of the Company. 

        (c)   The
term "Form F-3" means such form under the Act as in effect on the date hereof or any registration form under the Act subsequently adopted by the
SEC which permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC. 

        (d)   The
term "Holder" means the Investors and any person owning or having the right to acquire Registrable Securities or any person to whom the rights under Section 1
have been transferred in accordance with Section 1.13 hereof. 

        (e)   The
term "1934 Act" means the Securities Exchange Act of 1934, as amended. 

        (f)    The
term "register," "registered," and "registration" refer to a registration effected by preparing and filing a registration statement or similar document in compliance
with the Act, and the declaration or ordering of effectiveness of such registration statement or document. 

        (g)   The
term "Registrable Securities" means (i) the Shares, (ii) any additional shares of Common Stock issued as Repricing Shares pursuant to
section 1.5 of the Stock Purchase Agreements, and (iii) any other securities issued or issuable with respect to or in exchange of any of the securities referenced in (i) or (ii),
subject to appropriate adjustment for any stock split, stock dividend, recapitalization, merger or other reorganization; provided, however, that 

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securities
shall only be treated as Registrable Securities if and only for so long as they (A) have not been disposed of pursuant to a registration statement declared effective by the SEC;
(B) have not been sold in a transaction exempt from the registration and prospectus delivery requirements of the Act so that all transfer restrictions and restrictive legends with respect
thereto are removed upon the consummation of such sale; (c) are held by a Holder or a permitted transferee pursuant to Section 1.13; or (D) have not become eligible for sale
pursuant to Rule 144(k) (or any successor thereto) under the Act. 

        (h)   The
term "SEC" shall mean the Securities and Exchange Commission. 

        (i)    The
term "Shares" means the shares of Common Stock purchased pursuant to the Stock Purchase Agreements. 

        1.2    Request for Registration.    

        (a)   (i) If
(but without any obligation to do so) the Company proposes to register (including for this purpose a registration effected by the Company for shareholders
other than the Holders) any of its stock or other securities under the Act in connection with the initial public offering of such securities solely for cash (other than a registration relating solely
to the sale of securities to participants in a Company stock plan, a registration on any form which does not include substantially the same information as would be required to be included in a
registration statement covering the sale of the Registrable Securities or a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities
which are also being registered), the Company shall, if permitted under the Act and the rules and regulations promulgated thereunder, include in such registration statement the Registrable Securities.
The Registrable Securities shall not be part of the underwritten offering, but may be resold by the Investors subject to the market stand-off set forth in Section 1.14 hereof and
subject to the provisions of Rule 41.5 of the Act. 

        (ii)   If
the Company is not permitted under the Act and the rules and regulations promulgated thereunder to include the Registrable Securities in a registration statement
related to an initial public offering of its stock as set forth in clause (ii) above, and if the Company shall receive at any time after six (6) months following the effective date of
the first registration statement for a public offering of securities of the Company (other than a registration statement relating either to the sale of securities to employees of the Company pursuant
to a stock option, stock purchase or similar plan or an SEC Rule 145 transaction), a written request from the Holders of a majority of the Registrable Securities then outstanding that the
Company file a registration statement under the Act covering the registration of the Registrable Securities then outstanding with an aggregate offering price, net of underwriting discounts and
commissions of no less than two million dollars ($2,000,000), then the Company shall: 

        (A)  within
ten (10) days of the receipt thereof, give written notice of such request to all Holders in accordance with Section 3.5; and 

        (B)  effect
as soon as practicable the registration under the Act of all Registrable Securities which the Holders request to be registered, subject to the limitations of
subsection 1.2(b), within twenty (20) days of the mailing of such notice by the Company in accordance with Section 3.5. 

        (b)   If
the Holders initiating the registration request in accordance with Section 1.2(a)(ii) ("Initiating Holders") intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to subsection 1.2(a)(ii), and the Company shall include such
information in the written notice referred to in subsection 1.2(a)(ii). The underwriter will be 

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selected
by the Company and shall be reasonably acceptable to a majority in interest of the Initiating Holders. In such event, the right of any Holder to include its Registrable Securities in such
registration shall be conditioned upon such Holder's participation in such underwriting and the inclusion of such Holder's Registrable Securities in the underwriting (unless otherwise mutually agreed
by a majority in interest of the Initiating Holders and such Holder) to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with
the Company as provided in subsection 1.4(e)) enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting. Notwithstanding any other
provision of this Section 1.2, if the underwriter advises the Initiating Holders in writing that marketing factors require a limitation of the number of shares to be underwritten, then the
Initiating Holders shall so advise the Company, and the Company shall so advise all Holders of Registrable Securities which would otherwise be underwritten pursuant hereto, and the number of shares of
Registrable Securities that may be included in the underwriting shall be allocated among all Holders thereof in accordance with Section 1.8 hereof. 

        (c)   Notwithstanding
the foregoing, if the Company shall furnish to Holders requesting a registration statement pursuant to Section 1.2(a)(ii), a certificate signed by
the Chief Executive Officer of the Company stating that in the good faith judgment of the Board of Directors of the Company, it would be seriously detrimental to the Company and its shareholders for
such registration statement to be filed and it is therefore essential to defer the filing of such registration statement, the Company shall have the right to defer taking action with respect to such
filing for a period of not more than 120 days after receipt of the request of the Initiating Holders; provided, however, that the Company may not utilize this right more than once in any
twelve-month period. 

        (d)   In
addition, the Company shall be obligated to effect, or to take any action to effect, any registration pursuant to this Section 1.2(a)(ii): 

        (i)    After
the Company has effected two registrations pursuant to this Section 1.2(a)(ii) and such registrations have been declared or ordered effective; 

        (ii)   During
the period starting with the date sixty (60) days prior to the Company's good faith estimate of the date of filing of, and ending on a date one hundred
eighty (180) days (or, if shorter, the date the market stand-off time period expires pursuant to Section 1.14) after the effective date of, a registration subject to
Section 1.3 hereof; provided that the Company is actively employing on good faith all reasonable efforts to cause such registration statement to become effective; or 

        (iii)  If
the Initiating Holders propose to dispose of shares of Registrable Securities that are eligible to registered on Form F-3 pursuant to a request
made pursuant to Section 1.12 below. 

        1.3    Company Registration.    If (but without any obligation to do so) the Company proposes to register (including
for this purpose a registration effected by the Company for shareholders other than the Holders) any of its stock or other securities under the Act in connection with the public offering (other than
an initial public offering which shall be governed by the provisions in Section 1.2(a)(i)) of such securities solely for cash (other than a registration relating solely to the sale of
securities to participants in a Company stock plan, a registration on any form which does not include substantially the same information as would be required to be included in a registration statement
covering the sale of the Registrable Securities or a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities which are also being
registered), the Company shall, at such time, promptly give each Holder written notice of such registration in accordance with Section 3.5. Upon the written request of 

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each
Holder given with in twenty (20) days after mailing of such notice by the Company in accordance with Section 3.5, the Company shall subject to the provisions of Section 1.8,
cause to be registered under the Act all of the Registrable Securities that each such Holder has requested to be registered; provided, however, that the Company shall not be obligated to effect any
such registration pursuant to this Section 1.3 if the Holders propose to sell Registrable Securities at an aggregate price to the public (net of any underwriters' discounts or commissions) of
less than one million dollars ($1,000,000). 

        1.4.    Obligations of the Company.    Whenever required under this Section 1 to effect the registration of any
Registrable Securities, the Company shall, as expeditiously as reasonably possible: 

        (a)   Prepare
and file with the SEC a registration statement with respect to such Registrable Securities and use its reasonable commercial efforts to cause such registration
statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for a period of up to
one hundred twenty (120) days or until the distribution contemplated in the Registration Statement has been completed; provided, however, that (i) such 120-day period shall
be extended for a period of time equal to the period the Holder refrains from selling any securities included in such registration at the request of an underwriter of Common Stock (or other
securities) of the Company; and (ii) in the case of any registration of Registrable Securities on Form F-3 which are intended to be offered on a continuous or delayed basis,
such 120-day period shall be extended, if necessary, to keep the registration statement effective until all such Registrable Securities are sold, provided that Rule 415, or any
successor rule under the Act, permits an offering on a continuous or delayed basis, and provided further that applicable rules under the Act governing the obligation to file a
post-effective amendment permit, in lieu of filing a post-effective amendment which (1) includes any prospectus required by Section 10(a)(3) of the Act or
(II) reflects facts or events representing a material or fundamental change in the information set forth in the registration statement, the incorporation by reference of information required to
be included in (I) and
(II) above to be contained in periodic reports filed pursuant to Section 13 or 15(d) of the 1934 Act in the registration statement. 

        (b)   Prepare
and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as
may be necessary to comply with the provisions of the Act with respect to the disposition of all securities covered by such registration statement. 

        (c)   Furnish
to the Holders such numbers of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Act, and such other
documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them. 

        (d)   Use
its reasonable commercial efforts to register and qualify the securities covered by such registration statements under such other securities or Blue Sky laws of such
jurisdictions as shall be reasonably requested by the Holders; provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or jurisdictions. 

        (e)   In
the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing
underwriter of such offering. Each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement. 

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        (f)    Notify
each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the
Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing. 

        (g)   Cause
all such Registrable Securities registered pursuant hereunder to be listed on each securities exchange on which similar securities issued by the Company are then
listed. 

        (h)   Provide
a transfer agent and registrar for all Registrable Securities registered pursuant hereunder and a CUSIP number for all such Registrable Securities, in each case
not later than the effective date of such registration. 

        (i)    Furnish,
at the request of any Holder requesting registration of Registrable Securities pursuant to this Section 1, on the date that such Registrable Securities
are delivered to the underwriters for sale in connection with a registration pursuant to this Section 1, if such securities are being sold through underwriters, (i) an opinion, dated
such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, addressed to
the underwriters, if any, and to the Holders requesting registration of Registrable Securities and (ii) a letter dated such date, from the independent certified public accountants of the
Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters and to the Holders
requesting registration of Registrable Securities. 

        1.5.    Furnish Information.    It shall be a condition precedent to the obligations of the Company to take any action
pursuant to this Section 1 with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities as shall be required to effect the registration of such Holder's Registrable Securities. 

        1.6.    Expenses of Demand Registration.    All expenses other than underwriting discounts and commissions incurred in
connection with registrations, filings or qualifications pursuant to Section 1.2, including (without limitation) all registration, filing and qualification fees, printers' and accounting fees,
fees and disbursements of counsel for the Company (including fees and disbursements of counsel for the Company in its capacity as counsel to the selling Holders hereunder; if Company counsel does not
make itself available for this purpose, the Company will pay the reasonable fees and disbursements of one counsel for the selling Holders) shall be borne by the Company; provided, however, that the
Company shall not be required to pay for any expenses of any registration proceeding begun pursuant to Section 1.2(a)(ii) if the registration request is subsequently withdrawn at the
request of the Holders of a majority of the Registrable Securities to be registered (in which case all participating holders shall bear such expenses), unless the Holders of a majority of the
Registrable Securities agree to forfeit their right to one demand registration pursuant to Section 1.2. 

        1.7.    Expenses of Company Registration.    The Company shall bear and pay all expenses incurred in connection with
any registration, filing or qualification of Registrable Securities with respect to the registrations pursuant to Section 1.3 for each Holder (which right may be assigned as provided in
Section 1.13), including (without limitation) all registration, filing, and qualification fees, printers and accounting fees relating or apportionable thereto and the fees and disbursements of
counsel for the Company in its capacity as counsel to the selling Holders hereunder; if Company counsel does not make itself available for this purpose, the Company will pay the 

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reasonable
fees and disbursements of one counsel for the selling Holders selected by them, but excluding underwriting discounts and commissions relating to Registrable Securities. 

        1.8.    Underwriting Requirements.    In connection with any offering involving an underwriting of shares of the
Company's capital stock, the Company shall not be required under Section 1.2 or 1.3 to include any of the Holders' Shares in such underwriting unless they accept the terms of the underwriting
as agreed upon between the Company and the underwriters selected by it (or by other persons entitled to select the underwriters), and then only in such quantity as the underwriters determine in their
safe discretion will not, jeopardize the success of the offering by the Company. If the total amount of securities, including Registrable Securities, requested by shareholders to be included in such
offering exceeds the amount of securities sold other than by the Company that the underwriters determine in their sole discretion is compatible with the success of the offering, then the Company shall
be required to include in the offering only that number of such securities, including Registrable Securities, which the underwriters determine in their sole discretion will not jeopardize the success
of the offering (the securities so included to be apportioned pro-rata among the selling shareholders according to the total amount of securities entitled to be included therein owned by
each selling shareholder or in such other proportions as shall mutually be agreed to by such selling shareholders) but in no event shall the amount of Shares of the selling Holders included in the
offering be reduced below fifty percent (50%) of the total amount of Registrable Securities requested by such selling Holders to be included in the offering, unless there are no selling shareholders,
other than the selling Holders, in the offering, in which case the amount of securities of the selling Holders included in the offering may be reduced below fifty percent (50%). For purposes of the
preceding parenthetical concerning apportionment, for any selling shareholder which is a holder of Registrable Securities and which is a partnership or corporation, the partners, retired partners and
shareholders of such holder, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed to be a single
"selling shareholder," and any pro-rata reduction with respect to such "selling shareholder" shall be based upon the aggregate amount of shares carrying registration rights owned by all
entities and individuals included in such "selling shareholder," as defined in this sentence. 

        1.9.    Delay of Registration.    No Holder shall have any right to obtain or seek an injunction restraining or
otherwise delaying any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 1. 

        1.10.    Indemnification.    In the event any Registrable Securities are included in a registration statement under
this Section 1: 

        (a)   To
the extent permitted by law, the Company will indemnify and hold harmless each Holder, any underwriter (as defined in the Act) for such Holder and each person, if
any, who controls such Holder or underwriter within the meaning of the Act or the 1934 Act, against any losses, claims, damages, or liabilities (joint or several) to which they may become subject
under the Act, or the 1934 Act, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or
violations (collectively a "Violation"): (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus
or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading, or (in) any violation or alleged violation by the Company of the Act, the 1934 Act, or any rule or regulation promulgated under the Act, or the
1934 Act, and the Company will pay to each such Holder, underwriter or controlling person any legal or other expenses reasonably incurred by them in connection with investigating or defending any such
loss, claim, damage, liability, or action; 

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provided,
however, that the indemnity agreement contained in this subsection 1.10(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld), nor shall the Company be liable in any such case for any such loss, claim, damage,
liability, or action to the extent that it arises out of or is based upon a Violation which occurs in reliance upon and in conformity with written information furnished expressly for use in connection
with such registration by any such Holder, underwriter or controlling person. 

        (b)   To
the extent permitted by law, each selling Holder will indemnify and hold harmless the Company, each of its directors, each of its officers who has signed the
registration statement, each person, if any, who controls the Company within the meaning of the Act, any underwriter, any other Holder selling securities in such registration statement and any
controlling person of any such underwriter or other Holder, against any losses, claims, damages, or liabilities (joint or several) to which any of the foregoing persons may become subject, under the
Act or the 1934 Act insofar as such losses, claims, damages, or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the
extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder expressly for use in connection with such registration; and each such Holder
will pay any legal or other expenses reasonably incurred by any person intended to be indemnified pursuant to this subsection 1.10(b), in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity agreement contained in this subsection 1.10(b) shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the Holders of a majority-in-interest of the then outstanding Registrable Securities, which consent
shall not be unreasonably withheld; provided, that, in no event shall any indemnity under this subsection 1.10(b) exceed the gross proceeds from the offering received by such Holder. 

        (c)   Promptly
after receipt by an indemnified party under this Section 1.10 of notice of the commencement of any action (including any governmental action), such
indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 1.10, deliver to the indemnifying party a written notice of the
commencement thereof and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party (together with all other indemnified parties which may be represented without conflict by one counsel) shall have the right to
retain one separate counsel, with the reasonable fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party
would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement of any such action, if prejudicial to its ability to defend such action, shall relieve such indemnifying party of any
liability to the indemnified party under this Section 1.10, but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any
indemnified party otherwise than under this Section 1.10. 

        (d)   If
the indemnification provided for in this Section 1.10 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to
any loss, liability, claim, damage, or expense referred to therein, then the indemnifying party, in lieu of 

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indemnifying
such indemnified party hereunder shall contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage, or expense in such proportion
as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other in connection with the statements or omissions that resulted in such
loss, liability, claim, damage, or expense as well as any other relevant equitable considerations. The relative fault of the indemnifying party and of the indemnified party shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party
or by the indemnified party and the parties relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omission. 

        (e)   Notwithstanding
the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection
with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control. 

        (f)    The
obligations of the Company and Holders under this Section 1.10 shall survive the completion of any offering of Registrable Securities in a registration
statement under this Section 1, and otherwise. 

        1.11.    Reports Under Securities Exchange Act of 1934.    With a view to making available to the Holders the benefits
of Rule 144 promulgated under the Act and any other rule or regulation of the SEC that may at any time permit a Holder to sell securities of the Company to the public without registration or
pursuant to a registration on Form F-3, the Company agrees to: 

        (a)   make
and keep public information available, as those terms are understood and defined in SEC Rule 144, at all times after ninety (90) days after the
effective date of the first registration statement filed by the Company for the offering of its securities to the general public; 

        (b)   take
such action, including the voluntary registration of its Common Stock under Section 12 of the 1934 Act, as is necessary to enable the Holders to utilize
Form F-3 for the sale of their Registrable Securities, such action to be taken as soon as practicable after the end of the fiscal year in which the first registration statement
filed by the Company for the offering of its securities to the general public is declared effective; 

        (c)   file
with the SEC in a timely manner all reports and other documents required of the Company under the Act and the 1934 Act; and 

        (d)   furnish
to any Holder, so long as the Holder owns any Registrable Securities, forthwith upon request (i) a written statement by the Company that it has complied
with the reporting requirements of SEC Rule 144 (at any time after one (1) year after the effective date of the first registration statement filed by the Company), the Act and the 1934
Act (at any time after it has become subject to such reporting requirements), or that it qualifies as a registrant whose securities may be resold pursuant to Form F-3 (at any time
after it so qualifies), (ii) a copy of the most recent annual report of the Company and such other reports and documents so filed by the Company, and (iii) such other information as may
be reasonably requested in availing any Holder of any rule or regulation of the SEC which permits the selling of any such securities without registration or pursuant to such form. 

        1.12.    Form F-3 Registration.    In case the Company shall receive from any Holder or Holders a
written request or requests that the Company effect a registration on Form F-3 and any related 

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qualification
or compliance with respect to all or a part of the Registrable Securities owned by such Holder or Holders, the Company will: 

        (a)   promptly
give written notice of the proposed registration, and any related qualification or compliance, to all other Holders; and 

        (b)   as
soon as practicable, effect such registration and all such qualifications and compliances as may be so requested and as would permit or facilitate the sale and
distribution of all or such portion of such Holder's or Holders' Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of any other
Holder or Holders joining in such request as are
specified in a written request given within 15 days after receipt of such written notice from the Company; provided, however, that the Company shall not be obligated to effect any such
registration, qualification or compliance, pursuant to this section 1.12: (1) if Form F-3 is not available for such offering by the Holders, (2) if the Holders
propose to sell Registrable Securities at an aggregate price to the public (net of any underwriters' discounts or commissions) of less than one million dollars ($1,000,000); (3) if the Company
shall furnish to the Holders a certificate signed by the President of the Company stating that in the good faith judgment of the Board of Directors of the Company, it would be seriously detrimental to
the Company and its shareholders for such Form F-3 Registration to be effected at such time, in which event the Company shall have the right to defer the filing of the
Form F-3 registration statement for a period of not more than one hundred twenty (120) days after receipt of the request of the Holder or Holders under this
Section 1.12; provided, however, that the Company shall not utilize this right more than once in any twelve month period; (4) if the Company has, within the twelve (12) month
period preceding the date of such request, already effected two registrations on Form F-3 for the Holders pursuant to this Section 1.12; or (5) in any particular
jurisdiction in which the Company would be required to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance. 

        (c)   Subject
to the foregoing, the Company shall file a registration statement covering the Registrable Securities and other securities so requested to be registered
as soon as practicable after receipt of the request or requests of the Holders. All expenses incurred in connection with a registration requested pursuant to Section 1.12, including (without
limitation) all registration, filing, qualification, printer's and accounting fees and the reasonable fees and disbursements of counsel for the selling Holder or Holders and counsel for the Company,
but excluding any underwriters' discounts or commissions associated with Registrable Securities, shall be borne by the Company. Registrations effected pursuant to this Section 1.12 shall not be
counted as demands for registration or registrations effected pursuant to Sections 1.2 or 1.3, respectively. 

11

  

        1.13.    Assignment of Registration Rights.    The rights to cause the Company to register Registrable Securities
pursuant to this Section 1 may be assigned (but only with all related obligations) by a Holder to a transferee or assignee of such securities who, after such assignment or transfer, holds at
least 100,000 shares of Registrable Securities (subject to appropriate adjustment for stock splits, stock dividends, combinations and other recapitalizations), provided: (a) the Company is,
within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are
being assigned (b) such transferee or assignee agrees in writing to be bound by and subject to the terms and conditions of this Agreement, including without limitation the provisions of
Section 1.14 below; and (c) such assignment shall be effective only if immediately following such transfer the further disposition of such securities by the transferee or assignee is
restricted under the Act. For the purposes of determining the number of shares of Registrable Securities held by a transferee or assignee, the holding of transferees and assignees of a partnership who
are partners or retired partners of such partnership (including spouses and ancestors, lineal descendants and siblings of such partners or spouses who acquire Registrable Securities by gift, will or
intestate succession) shall be aggregated together and with the partnership; provided that all assignees and transferees who would not qualify individually for assignment of registration rights shall
have a single attorney-in-fact for the purpose of exercising any rights, receiving notices or taking any action under this Section 1. 

        1.14.    "Market Stand-Off" Agreement.    Each Investor hereby agrees that, during the period of duration
specified by the Company and an underwriter of common stock or other securities of the Company, following the effective date of a registration statement of the Company filed under the Act, it shall
not, to the extent requested by the Company and such underwriter, directly or indirectly sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to
purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound) any Shares of the Company purchased by it except common stock included in such registration;
provided, however, that: 

        (a)   all
officers and directors of the Company and all other persons with registration rights (whether or not pursuant to this Agreement) enter into similar agreements; and 

        (b)   such
market stand-off time period shall not exceed one hundred eighty (180) days for an initial public offering of the Company's securities and for
ninety (90) days for a follow-on offering of the Company's securities. 

        In
order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Registrable Securities of each Investor (and the shares or
securities of every other person subject to the foregoing restriction) until the end of such period. 

        Notwithstanding
the foregoing, the obligations described in this Section 1.14 shall not apply to a registration relating solely to employee benefit plans on
Form F-1 or Form S-8 or similar forms which may be promulgated in the future, or a registration relating solely to a Commission Rule 145 transaction on
Form S-4 or similar forms which may be promulgated in the future. 

        1.15.    Termination of Registration Rights.    

        (a)   No
Holder shall be entitled to exercise any right provided for in this Section 1 after three (3) years following the consummation of the sale of securities
pursuant to a registration statement filed by the Company under the Act in connection with the initial firm commitment underwritten offering of its securities to the general public. 

        (b)   In
addition, the right of any Holder to request registration or inclusion in any registration pursuant to Section 1.3 shall terminate on the closing of the first
Company-initiated registered public offering of Common Stock of the Company if all shares of 

12

 

Registrable
Securities held by such Holder may immediately be sold under Rule 144 during any 90-day period, or on such date after the closing of the first Company-initiated
registered public offering of Common Stock of the Company as all shares of Registrable Securities held by such Holder may immediately be sold under Rule 144 during any 90-day
period; provided, however, that the provisions of this subsection 1.15(b) shall not apply to any Holder who owns more than two percent (2%) of the Company's outstanding stock until such time as such
Holder owns less than two percent (2%) of the outstanding stock of the Company. 

        2.    Covenants of the Company.    

        2.1.    Delivery of Financial Statements.    The Company shall deliver to each Investor for so long as such Investor
holds Shares. 

        (a)   as
soon as practicable, but in any event within ninety (90) days after the end of each fiscal year of the Company, an income statement for such fiscal year, a
balance sheet of the Company and statement of shareholder's equity as of the end of such year, and a schedule as to the sources and applications of funds for such year, such year-end
financial reports to be in reasonable detail, prepared in accordance with Italian generally accepted accounting principles ("GAAP"), and audited and certified by independent public accountants of
nationally recognized standing selected by the Company. 

        (b)   as
soon as practicable, but in any event within forty-five (45) days after the end of each of the first three (3) quarters of each fiscal year
of the Company, an unaudited profit or loss statement, schedule as to the source and application of funds for such fiscal quarter and an unaudited balance sheet as of the end of such fiscal quarter. 

        (c)   within
thirty (30) days of the end of each month, an unaudited income statement and schedule as to the sources and application of funds and balance sheet for and
as of the end of such month, in reasonable detail; 

        (d)   as
soon as practicable, but in any event thirty (30) days prior to the end of each fiscal year, a budget and business plan for the next fiscal year, prepared on a
monthly basis, including balance sheets and sources and applications of funds statements for such months and, as soon as prepared, any other budgets or revised budgets prepared by the Company; 

        (e)   with
respect to the financial statements called for in subsections (b) and (c) of this Section 2.1, an instrument executed by the Chief Financial
Officer on President of the Company and certifying that such financials were prepared in accordance with GAAP consistently applied with prior practice for earlier periods (with the exception of
footnotes that may be required by GAAP) and fairly present the financial condition of the Company and its results of operation for the period specified, subject to year-end audit
adjustment; 

        (f)    such
other information relating to the financial condition, business, prospects or corporate affairs of the Company as the Investor or any assignee of the Investor may
from time to time request, provided, however, that the Company shall not be obligated under this subsection (f) or any other subsection of Section 2.1 to provide information which it
deems in good faith to be a trade secret or similar confidential information. 

        2.2    Inspection.    The Company shall permit each Investor, at such Investor's expense, to visit and inspect the
Company's properties, to examine its books of account and records and to discuss the Company's affairs, finances and accounts with its officers, all at such reasonable times as may be requested by the
Investor; provided, however, that the Company shall not be obligated pursuant to this Section 2.2 to provide access to any information which it reasonably considers to be a trade secret or
similar confidential information. 

13

 

        2.3    Termination of Information and Inspection Covenants.    The covenants set forth in subsections 2.1(c),
(d) and (f) and Section 2.2 shall terminate as to Investors and be of no further force or effect when the
sale of securities pursuant to a registration statement filed by the Company under the Act in connection with the firm commitment underwritten offering of its securities to the general public is
consummated or when the Company first becomes subject to the periodic reporting requirements of Sections 12(g) of 15(d) of the 1934 Act, whichever event shall first occur. 

        2.4    Right of First Refused on Dispositions.    

        (a)   If
at any time any Investor desires to sell all or any part of such Investor's Shares to a third party (the "Proposed Transferee"), such Investor ("Selling Investor")
shall first submit to the Majority Shareholder and the Company (i) a bona fide written offer from the Proposed Transferee to purchase such Shares (which, upon acceptance by such Investor, would
constitute a legally binding obligation) and (ii) a written offer from the Selling, Investor (the "Offer") to sell such Shares (the "Offered Securities") to the Majority Shareholder and the
Company on terms and conditions, including price, not less favorable than those on which the Selling Investor proposes to sell such Offered Securities to the Proposed Transferee. The Offer shall
disclose the identity of the Proposed Transferee, the Offered Securities proposed to be sold, the total number of Shares owned by the Selling Investor, the terms and conditions, including price, of
the proposed sale, and any other material facts relating to the proposed sale and shall include a copy of the Offer to purchase from the Proposed Transferee. The Offer shall further state that the
Majority Shareholder and the Company may acquire, in accordance with the provisions of this Agreement, all, but not less than all, of the Offered Securities for the price and upon the other terms and
conditions, including deferred payment (if applicable), set forth therein. 

        (b)   If
the Majority Shareholder and/or the Company desires to purchase all, but not less than all, of the Offered Securities, the Majority Shareholder and/or the Company, as
applicable, shall communicate in writing its election to purchase to the Selling Investor within fifteen (15) days of the date the Offer was made to the Majority Shareholder and the Company.
Such communications shall, when taken in conjunction with the Offer, be deemed to constitute valid, legally binding and enforceable agreement(s) for the sale and purchase of such Offered Securities. 

        (c)   If
the Majority Shareholder and/or the Company elects to purchase the Offered Securities, the sale of such Offered Securities to the Majority Shareholder and/or the
Company, as applicable, pursuant to this Section 2.4 shall be made at the offices of the Company or counsel to the Company on the 30th day following the date the Offer was made pursuant to
subsection (a) above (or if such day is not a business day, then on the next succeeding business day). Such sale shall be effected by the Selling Investor's delivery to the Majority Shareholder
and/or the Company, as applicable of certificates or other instruments evidencing the Offered Securities to be purchased by it, duly endorsed for transfer, against payment to the Selling Investor of
the purchase price therefor by the Majority Shareholder and/or the Company, as applicable. 

        (d)   If
neither the Majority Shareholder nor the Company elects to purchase all of the Offered Securities, the Offered Securities may be sold by the Selling Investor at any
time within 30 days after the date the Offer was accepted, rejected or lapsed pursuant to subsection (b) above. Any such sale shall be to the Proposed Transferee and at not less than the
price and upon other terms and conditions, if any, not more favorable to the Proposed Transferee than those specified in the Offer. Any Offered Securities not sold within such 30-day
period shall continue to be subject to the requirements of a prior offer pursuant to this Section 2.4. 

14

 

        (e)   The
Majority Shareholder's and the Company's right of first refusal provided in this Section 2.4 shall not apply (i) in conjunction with the sale of the
Company to an unaffiliated third party whether by merger consolidation or sale of stock in a transaction in which the Majority Shareholder's shares are also sold or transferred, or (ii) in
conjunction with a public offering pursuant to an effective registration statement under the Act. 

        (f)    If
an Investor is subject to a transfer of its Shares by any bankruptcy or insolvency law or proceeding, any divorce proceeding or otherwise by operation of law (other
than by death), or if any transfer of Shares is made or attempted contrary to the provisions of this Agreement, the Majority Shareholder and the Company will have the right to purchase any or all of
such Shares from the Investor, his her or its legal representative or transferees at any time before or after the transfer, at the price, if any, paid for or proposed to be paid for such Shares or for
fair market value as determined under subsection (g), whichever is less. 

        (g)   The
fair market value of the Shares subject to purchase pursuant to subsection (f) will be jointly determined by the seller and the Majority Shareholder and the
Company, as applicable, who elect to purchase, or if they are unable to agree, by such other appraiser as the seller and the Majority Shareholder and the Company, as applicable, may jointly choose.
The seller shall bear all of the fees and expenses arising out of the appraisal. 

        (h)   The
agreements set forth in this Section 2.4 shall terminate and be of no further force or effect when the sale of Shares pursuant to a registration statement
filed by the Company under the Act in connection with the firm commitment underwritten offering of its securities to the general public is consummated or when the Company first becomes subject to the
periodic reporting requirements of Sections 12(g) or 15(d) of the 1934 Act, whichever event shall first occur. 

        2.5.    Drag-Along Rights.    At any time prior to an initial public offering of securities of the
Company, in the event that (i) the Company receives a bona fide offer from any party unaffiliated with any party to this Agreement (such party a "Third Party Offeror" and such an offer the "The
Third Party Offer") to purchase all or substantially all the Company's issued and outstanding shares of capital stock in a transaction (including a merger) for consideration equal to not less than $9
per share (such
price subject to equitable adjustments for stock splits, stock dividends, combinations, recapitalizations, reclassifications and similar events occurring after the effective date hereof),
(ii) such transaction is approved by the Board of Directors of the Company, and (iii) the holders (the "Proposing Shareholders") of shares representing a majority of the votes
represented by all then outstanding shares of capital stock of the Company approve or otherwise consent in writing to such transaction, then each Investor will be required, if so demanded by the
Proposing Shareholders, to vote such investor's Shares in favor thereof, and otherwise consent to and raise no objection to such transaction, and waive any dissenters' rights, appraisal rights or
similar rights that such Investor may have in connection therewith, and take all necessary and desirable actions as directed by the Company's Board of Directors and the Proposing Shareholders in
connection with the consummation of such transactions, including, to the extent applicable, executing a purchase agreement and selling, exchanging or otherwise transferring, all of the Shares held by
such Investors to such Third Party Offeror at the same price and upon the same terms and conditions as the Third Party Offer. If an Investor fails or refuses to vote its Shares as required by the
terms of this Section 2.5, the President of the Company shall be deemed to be granted by such Investor an irrevocable proxy, coupled with an interest, to vote such Investor's Shares in
accordance with this Section 2.5. 

        3.    Miscellaneous.    

        3.1.    Successors and Assigns.    Except as otherwise provided herein, the terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors and 

15

 

assigns
of the parties (including transferees of any shares of Registrable Securities). Subject to Sections 2.4 and 2.5 if applicable, nothing in this Agreement, express or implied, is intended to
confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement. 

        3.2.    Governing Law.    This Agreement shall be construed in accordance with and governed by the laws of the State
of New York without regard to principles of conflicts of laws. In the event that a judicial proceeding is necessary, the exclusive forums for resolving disputes arising out of or relating to this
Agreement are either the Supreme Court of the State of New York in and for the County of New York or the federal courts for such State and County, and all related appellate courts, the parties hereby
irrevocably consent to the jurisdiction of such courts and agree to said venue. 

        3.3.    Counterparts.    This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. 

        3.4.    Titles and Subtitles.    The titles and subtitles used in this Agreement are used for convenience only and are
not to be considered in construing or interpreting this Agreement. 

        3.5.    Notices.    Except as otherwise expressly specified herein, all notices, requests and other communications
required or permitted hereunder shall be in writing and shall be sent by an internationally recognized overnight courier service; by certified or registered mail, return receipt requested (or in the
case of a notice sent to an address in Italy, by international express mail, return receipt requested); by facsimile transmission or by hand delivery. 

The
address for such notices and communications shall be as follows: 

If
to the Company:

Gentium S.p.A.

Piazza XX Settembre, 2

22079 Villa Guardia Como

Italy

Attention: Dott, Sauro Carsana

Fax: +39 031 385333 

If
to an Investor: 

To
the address set forth in the applicable Stock Purchase Agreement or such other address as provided by the Investor to Issuer in writing. 

Any
party may designate a different notice address, contact person, telephone number or facsimile number with respect to such party by providing a notice describing such charges to the other party
hereto in accordance with the provisions of this Section 3.5. Any notice sent by internationally recognized overnight mail courier service shall be deemed to be delivered to the address shown
on the mailing receipt on the expected date of delivery upon proper evidence of mailing for purposes of this section 3.5. Any notice sent by certified or registered mail, return receipt
requested (or, in the case of a notice sent to an address n Italy, by international express mail, return receipt requested), shall be deemed to be delivered five business days after mailing. Any
notice sent by facsimile transmission shall be deemed delivered as of the open of business on the business day following the date on which sent provided the sender receives written confirmation of
transmission and provided that within 24 hours such notice is also sent by regular mail or by an internationally-recognized overnight mail courier service to the appropriate address specified
above. Any notice sent by hand delivery shall be deemed delivered as of the date of delivery. 

16

 

        3.6.    Expenses.    If any action at law or in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable attorney's fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled. 

        3.7.    Amendments and Waivers.    Any term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the holders of a
majority-in-interest of the Registrable Securities then outstanding [which holders shall include Generation]. Any amendment or waiver effected in
accordance with this paragraph shall be binding upon each holder of any Registrable Securities then outstanding, each future holder of all such Registrable Securities, and the Company. 

        3.8.    Severability.    The holding of any provision of this Agreement to be invalid or unenforceable by a court of
competent jurisdiction shall not affect any other provision of this Agreement, which shall remain in full force and effect. If any provision of this Agreement shall be declared by a court of competent
jurisdiction to be invalid, illegal or incapable of being enforced in whole or in part, such provision shall be interpreted so as to remain enforceable to the maximum extent permissible consistent
with applicable law and the remaining conditions and provisions or portions thereof shall nevertheless remain in full force and effect and enforceable to the extent that they are valid, legal and
enforceable, and no provisions shall be deemed dependent upon any other covenant or provision unless so expressed herein. 

        3.9.    Entire Agreement.    This Agreement sets forth the entire agreement and understanding between the parties as
to the subject matter hereof and merges and supersedes all prior discussions, agreements and understandings of any and every nature among them. 

[Remainder
of page intentionally left blank] 

17

   
        IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. 

	 	 	GENTIUM S.P.A.
	

 	
 	

By:	
/s/ [ILLEGIBLE]
 Name:

Title:
	

 	
 	
ALEXANDRA GLOBAL MASTER FUND, LTD.
	

 	
 	
By:	
ALEXANDRA INVESTMENT MANAGEMENT, LLC,
 as Investment Advisor
	

 	
 	

By:	

/s/  M. Filimonov      
 Name:  Mikhail Filimonov

Title:    Chairman and Chief Executive Officer
	

 	
 	

Address:
	 	 	 	c/o Alexandra Investment

    Management, LLC

767 Third Avenue

39th Floor

New York, New York 10017
	

 	
 	

Facsimile No.:  (212) 301-1810
	

 	
 	
GENERATION CAPITAL ASSOCIATES
	

 	
 	

By:	

/s/  David A. Rappaport        
 Name:  David A. Rappaport

Title:    EVP & General Counsel

18

QuickLinks

Exhibit 4.3

INVESTORS' RIGHTS AGREEMENT

January 10, 2005

Table of Contents

INVESTORS' RIGHTS AGREEMENTQuickLinks
 -- Click here to rapidly navigate through this document

 
 

Exhibit 10.1    
    

GENTIUM S.P.A.  

 2004 EQUITY INCENTIVE PLAN  

 
TABLE OF CONTENTS  

	 
	 	 
	 	PAGE

	SECTION 1.    PURPOSE	 	1
	

SECTION 2.    DEFINITIONS	
 	

1
	 	(a)	 	"Affiliate"	 	1
	 	(b)	 	"Award"	 	1
	 	(c)	 	"Award Agreement"	 	1
	 	(d)	 	"Board"	 	1
	 	(e)	 	"Change In Control"	 	1
	 	(f)	 	"Code"	 	2
	 	(g)	 	"Committee"	 	2
	 	(h)	 	"Common Stock"	 	2
	 	(i)	 	"Company"	 	2
	 	(j)	 	"Consultant"	 	2
	 	(k)	 	"Corporate Transaction"	 	2
	 	(l)	 	"Covered Employee"	 	2
	 	(m)	 	"Director"	 	2
	 	(n)	 	"Disability"	 	2
	 	(o)	 	"Employee"	 	3
	 	(p)	 	"Exchange Act"	 	3
	 	(q)	 	"Exercise Price"	 	3
	 	(r)	 	"Fair Market Value"	 	3
	 	(s)	 	"Grant"	 	3
	 	(t)	 	"Incentive Stock Option" or "ISO"	 	3
	 	(u)	 	"Key Employee"	 	3
	 	(v)	 	"Non-Employee Director"	 	3
	 	(w)	 	"Nonstatutory Stock Option" or "NSO"	 	3
	 	(x)	 	"Option"	 	3
	 	(y)	 	"Optionee"	 	3
	 	(z)	 	"Parent"	 	3
	 	(aa)	 	"Participant"	 	4
	 	(bb)	 	"Plan"	 	4
	 	(cc)	 	"Restricted Stock"	 	4
	 	(dd)	 	"Restricted Stock Agreement"	 	4
	 	(ee)	 	"SAR Agreement"	 	4
	 	(ff)	 	"Securities Act"	 	4
	 	(gg)	 	"Service"	 	4
	 	(hh)	 	"Share"	 	4
	 	(ii)	 	"Stock Appreciation Right" or "SAR"	 	4
	 	(jj)	 	"Stock Bonus"	 	4
	 	(kk)	 	"Stock Bonus Agreement"	 	4
	 	(ll)	 	"Stock Option Agreement"	 	4
	 	(mm)	 	"Stock Purchase Right"	 	4
	 	(nn)	 	"Stock Unit"	 	4
	 	(oo)	 	"Stock Unit Agreement"	 	4
	 	(pp)	 	"Subsidiary"	 	4
	 	(qq)	 	"10-Percent Shareholder"	 	4
	 	 	 	 	 

i

 

	SECTION 3.    ADMINISTRATION	 	4
	 	(a)	 	Administration by Board.	 	4
	 	(b)	 	Powers of Board.	 	5
	 	(c)	 	Delegation to Committee.	 	5
	 	(d)	 	Effect of Board's Decision.	 	6
	 	(e)	 	Indemnification.	 	6
	

SECTION 4.    ELIGIBILITY	
 	

6
	 	(a)	 	General Rules	 	6
	 	(b)	 	Incentive Stock Options	 	6
	 	(c)	 	Non-Employee Director Options	 	6
	

SECTION 5.    SHARES SUBJECT TO PLAN	
 	

7
	 	(a)	 	Basic Limitation	 	7
	 	(b)	 	Additional Shares	 	7
	 	(c)	 	Limits on Options and SARs	 	7
	 	(d)	 	Limits on Stock Purchase Rights, Stock Units and Stock Bonuses	 	7
	

SECTION 6.    TERMS AND CONDITIONS OF OPTIONS	
 	

7
	 	(a)	 	Stock Option Agreement	 	7
	 	(b)	 	Number of Shares	 	7
	 	(c)	 	Exercise Price	 	8
	 	(d)	 	Exercisability and Term	 	8
	 	(e)	 	Modifications or Assumption of Options	 	8
	 	(f)	 	Transferability of Options	 	8
	 	(g)	 	Restrictions on Transfer	 	8
	 	(h)	 	Incentive Stock Option $100,000 Limitation.	 	8
	

SECTION 7.    PAYMENT FOR OPTION SHARES	
 	

8
	 	(a)	 	General Rule	 	8
	 	(b)	 	Surrender of Stock	 	9
	 	(c)	 	Cashless Exercise	 	9
	 	(d)	 	Other Forms of Payment	 	9
	

SECTION 8.    TERMS AND CONDITIONS FOR AWARDS OF STOCK PURCHASE RIGHTS AND STOCK UNITS.	
 	

9
	 	(a)	 	Time, Amount and Form of Awards	 	9
	 	(b)	 	Restricted Stock and Stock Unit Agreements	 	9
	 	(c)	 	Payment for Restricted Stock or Stock Unit Awards	 	9
	 	(d)	 	Form and Time of Settlement of Stock Units	 	9
	 	(e)	 	Vesting Conditions	 	9
	 	(f)	 	Assignment or Transfer of Restricted Stock or Stock Units	 	9
	 	(g)	 	Death of Stock Units Recipient	 	10
	 	(h)	 	Trusts	 	10
	 	(i)	 	Voting and Dividend Rights	 	10
	 	(j)	 	Stock Units Voting and Dividend Rights	 	10
	 	(k)	 	Creditors' Rights	 	10
	

SECTION 9.    TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS	
 	

10
	 	(a)	 	SAR Agreement	 	10
	 	(b)	 	Number of Shares	 	11
	 	(c)	 	Exercise Price	 	11
	 	(d)	 	Exercisability and Term	 	11
	 	 	 	 	 

ii

 

	 	(e)	 	Exercise of SARs	 	11
	 	(f)	 	Modification or Assumption of SARs	 	11
	

SECTION 10.    TERMS AND CONDITIONS OF STOCK BONUSES	
 	

11
	 	(a)	 	Stock Bonus Agreement.	 	11
	 	(b)	 	Number of Shares.	 	11
	 	(c)	 	Consideration	 	11
	 	(d)	 	Vesting.	 	11
	 	(e)	 	Transferability.	 	12
	 	(f)	 	Death of Stock Bonus Recipient	 	12
	 	(g)	 	Trusts	 	12
	 	(h)	 	Stock Bonus Voting and Dividend Rights	 	12
	

SECTION 11.    PROTECTION AGAINST DILUTION	
 	

12
	 	(a)	 	Adjustments	 	12
	 	(b)	 	Participant Rights	 	13
	

SECTION 12.    EFFECT OF A CORPORATE TRANSACTION	
 	

13
	 	(a)	 	Merger or Reorganization	 	13
	 	(b)	 	Acceleration	 	13
	

SECTION 13.    LIMITATIONS ON RIGHTS	
 	

13
	 	(a)	 	Retention Rights	 	13
	 	(b)	 	Shareholders' Rights	 	13
	 	(c)	 	Regulatory Requirements	 	13
	

SECTION 14.    WITHHOLDING TAXES	
 	

13
	 	(a)	 	General	 	13
	 	(b)	 	Share Withholding	 	13
	

SECTION 15.    DURATION AND AMENDMENTS	
 	

14
	 	(a)	 	Term of the Plan	 	14
	 	(b)	 	Right to Amend, Suspend or Terminate the Plan	 	14
	 	(c)	 	Right to Amend Award.	 	14
	

SECTION 16.    EXECUTION	
 	

14
	

APPENDIX A GENTIUM S.P.A. 2004 ITALY STOCK AWARD SUB-PLAN	
 	

1
	

SECTION 1.    BACKGROUND AND PURPOSE	
 	

1
	

SECTION 2.    DEFINITION AND CONSTRUCTION	
 	

1
	

SECTION 3.    INCORPORATION OF PLAN	
 	

2
	

SECTION 4.    ITALIAN STOCK OPTION TERMS	
 	

2
	 	(a)	 	Italian Stock Option Agreement	 	2
	 	(b)	 	Number of Shares	 	2
	 	(c)	 	Exercise Price	 	2
	 	 	 	 	 

iii

 

	 	(d)	 	Exercisability and Term	 	2
	 	(e)	 	Withholding Obligations.	 	2
	 	(f)	 	Transferability	 	2
	

SECTION 5.    ITALIAN STOCK GRANT TERMS	
 	

2
	 	(a)	 	Italian Stock Grant Agreement.	 	3
	 	(b)	 	Number of Shares.	 	3
	 	(c)	 	Consideration.	 	3
	 	(d)	 	Vesting	 	3
	 	(e)	 	Withholding Obligations	 	3
	 	(f)	 	Transferability	 	3
	

SECTION 6.    EFFECT OF A CORPORATE TRANSACTION	
 	

3
	 	(a)	 	Merger or Reorganization	 	3
	 	(b)	 	Acceleration	 	3
	

SECTION 7.    LIMITATIONS ON RIGHTS	
 	

3
	 	(a)	 	Retention Rights	 	3
	 	(b)	 	Shareholders' Rights	 	3
	 	(c)	 	Regulatory Requirements	 	3
	

SECTION 8.    DURATION AND AMENDMENTS	
 	

4
	 	(a)	 	Term of the Italy Sub-Plan	 	4
	 	(b)	 	Right to Amend, Suspend or Terminate the Italy Sub-Plan	 	4
	 	(c)	 	Right to Amend Italian Award	 	4
	

SECTION 9.    EXECUTION	
 	

4

iv

GENTIUM S.P.A.  

 2004 EQUITY INCENTIVE PLAN  

 
  SECTION 1.    PURPOSE.    
    

        The Board adopted the Gentium S.p.A. 2004 Equity Incentive Plan on September 30, 2004 (the "Adoption Date"), subject to approval by the Company's
shareholders. The Plan shall become effective as of the date on which Shares are first made available to the general public pursuant to an initial public offering of the Shares (the "IPO Date"). 

        In
addition, the Board adopted the Italy Stock Award Sub-Plan (the "Italy Sub-Plan") on the Adoption Date, subject to approval by the Company's shareholders. The
Italy Sub-Plan shall become effective as of the IPO Date. The Italy Sub-Plan, attached to the Plan as Appendix A, contains the additional provisions that are to be read
in conjunction with the Plan and are applicable to Italian Key Employees who are liable for income tax in the Republic of Italy. 

        The
purpose of the Plan is to promote the long-term success of the Company and the creation of shareholder value by offering Key Employees an opportunity to acquire a
proprietary interest in the success of the Company, or to increase such interest, and to encourage such selected persons to continue to provide services to the Company and to attract new individuals
with outstanding qualifications. 

        The
Plan seeks to achieve this purpose by providing for Awards in the form of Stock Purchase Rights granting Restricted Stock, Stock Units, Stock Appreciation Rights, Stock Bonuses and
Options (which may constitute Incentive Stock Options or Nonstatutory Stock Options). 

        The
Plan shall be governed by, and construed in accordance with, the laws of the State of Delaware (except its choice-of-law provisions). Capitalized terms shall
have the
meaning provided in Section 2 of the Plan or the Italy Sub-Plan unless otherwise provided in this Plan or the applicable Award Agreement, or other applicable agreement. 

 
 

SECTION 2.    DEFINITIONS.    
    

 
 
        (a)    "Affiliate"   means any entity other than a Subsidiary, if the Company and/or one or more Subsidiaries own not less
than 50% of such entity. For purposes of determining an
individual's "Service," this definition shall include any entity other than a Subsidiary, if the Company, a Parent and/or one or more Subsidiaries own not less than 50% of such entity. 

 
 
        (b)    "Award"   means any Grant of an Option, SAR, Stock Unit, Stock Bonus or Stock Purchase Right under the Plan.

 
 
        (c)    "Award Agreement"   means a written agreement between the Company and a Participant evidencing the terms and
conditions of a Grant of an individual Award. Each Award Agreement shall
be subject to the terms and conditions of the Plan. 

 
 
        (d)    "Board"   means the Board of Directors of the Company, as constituted from time to time. 

 
 
        (e)    "Change In Control"   except as may otherwise be provided in an Award Agreement or other applicable agreement, means
the occurrence of any of the following: 

          (i)  The
consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if more than 50% of the combined voting
power of the continuing or surviving entity's securities outstanding immediately after such merger, consolidation or other reorganization is owned by persons who were not shareholders of the Company
immediately prior to such merger, consolidation or other reorganization; 

         (ii)  The
sale, transfer or other disposition of all or substantially all of the Company's assets; 

        (iii)  A
change in the composition of the Board, as a result of which fewer that one-half of the incumbent directors are directors who either (i) had been
directors of the Company on the date 

 

24 months
prior to the date of the event that may constitute a Change in Control (the "original directors") or (ii) were elected, or nominated for election, to the Board with the
affirmative votes of at least a majority of the aggregate of the original directors who were still in office at the time of the election or nomination and the directors whose election or nomination
was previously so approved; 

        (iv)  Any
transaction as a result of which any person becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing at least 20% of the total voting power represented by the Company's then outstanding voting securities. For purposes of this
Paragraph (iii), the term "person" shall have the same meaning as when used in sections 13(d) and 14(d) of the Exchange Act but shall exclude: 

        (A)  A
trustee or other fiduciary holding securities under an employee benefit plan of the Company or a subsidiary of the Company; 

        (B)  A
corporation owned directly or indirectly by the shareholders of the Company in substantially the same proportions as their ownership of the common stock of the
Company; and 

        (C)  The
Company; or 

         (v)  A
complete liquidation or dissolution of the Company. 

 
 
        (f)    "Code"   means the United States Internal Revenue Code of 1986, as amended. 

 
 
        (g)    "Committee"   means a committee consisting of one or more members of the Board that is appointed by the Board (as
described in Section 3) to administer the Plan. 

 
 
        (h)    "Common Stock"   means the Company's common stock. 

 
 
        (i)    "Company"   means Gentium S.p.A., a stock corporation organized under the laws of the Republic of Italy. 

 
 
        (j)    "Consultant"   means an individual who performs bona fide services to the Company, a Parent, a Subsidiary or an
Affiliate other than as an Employee or Director or
Non-Employee Director. 

 
 
        (k)    "Corporate Transaction"   means the occurrence, in a single transaction or in a series of related transactions, of any
one or more of the following events: 

          (i)  a
sale or other disposition of all or substantially all, as determined by the Board in its discretion, of the consolidated assets of the Company and its Subsidiaries; 

         (ii)  a
merger, consolidation or similar transaction following which the Company is not the surviving corporation; or 

        (iii)  a
merger, consolidation or similar transaction following which the Company is the surviving corporation but the shares of Common Stock outstanding immediately
preceding the merger, consolidation or similar transaction are converted or exchanged by virtue of the merger, consolidation or similar transaction into other property, whether in the form of
securities, cash or otherwise. 

 
 
        (l)    "Covered Employee"   means the chief executive officer and the four (4) other highest compensated officers of the
Company for whom total compensation is required to be reported
to shareholders under the Exchange Act, as determined for purposes of section 162(m) of the Code. 

 
 
        (m)    "Director"   means a member of the Board who is also an Employee. 

 
 
        (n)    "Disability"   means that the Key Employee is unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which
can be expected 

2

 

to
result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months. 

 
 
        (o)    "Employee"   means any individual who is a common-law employee of the Company, a Parent, a Subsidiary or an Affiliate.
Mere service as a Director or payment of a
director's fee by the Company or an Affiliate shall not be sufficient to constitute "employment" by the Company or an Affiliate. 

 
 
        (p)    "Exchange Act"   means the United States Securities Exchange Act of 1934, as amended. 

 
 
        (q)    "Exercise Price"   means, in the case of an Option, the amount for which a Share may be purchased upon exercise of
such Option, as specified in the applicable Stock Option
Agreement. "Exercise Price," in the case of a SAR, means an amount, as specified in the applicable SAR Agreement, which is subtracted from the Fair Market Value of a Share in determining the amount
payable upon exercise of such SAR. 

 
 
        (r)    "Fair Market Value"   means the market price of Shares, determined by the Committee as follows: 

          (i)  If
the Shares were traded on a stock exchange on the date in question, then the Fair Market Value shall be equal to the closing price reported by the applicable
composite transactions report for such date; 

         (ii)  If
the Shares were traded over-the-counter on the date in question and were classified as a national market issue or small cap issue, then the
Fair Market Value shall be equal to the closing price quoted by the NASDAQ system for such date; 

        (iii)  If
the Shares were traded over-the-counter on the date in question but were not classified as a national market issue, then the Fair Market
Value shall be equal to the mean between the last reported representative bid and asked prices quoted by the applicable trading market for such date; and 

        (iv)  If
none of the foregoing provisions is applicable, then the Fair Market Value shall be determined by the Committee in good faith on such basis as it deems appropriate. 

        Whenever
possible, the determination of Fair Market Value by the Committee shall be based on the prices reported in the Wall Street
Journal. Such determination shall be conclusive and binding on all persons. 

 
 
        (s)    "Grant"   means any grant of an Award under the Plan. 

 
 
        (t)    "Incentive Stock Option" or "ISO"   means an incentive stock option
described in Code section 422(b). 

 
 
        (u)    "Key Employee"   means an Employee, Director, Non-Employee Director or Consultant who has been selected by the
Committee to receive an Award under the Plan. 

 
 
        (v)    "Non-Employee Director"   means a member of the Board who is not an Employee. 

 
 
        (w)    "Nonstatutory Stock Option" or "NSO"   means a stock option that is not
an ISO. 

 
 
        (x)    "Option"   means an ISO or NSO granted under the Plan entitling the Optionee to purchase Shares. 

 
 
        (y)    "Optionee"   means an individual, estate or other entity that holds an Option. 

 
 
        (z)    "Parent"   means a "parent corporation," whether now or hereafter existing, as defined in section 424(e) of the
Code. 

3

 

 
 
        (aa)    "Participant"   means an individual or estate or other entity that holds an Award. 

 
 
        (bb)    "Plan"   means this Gentium S.p.A. 2004 Equity Incentive Plan as it may be amended from time to time. 

 
 
        (cc)    "Restricted Stock"   means a Share awarded under the Plan pursuant to a Stock Purchase Right. 

 
 
        (dd)    "Restricted Stock Agreement"   means the agreement described in Section 8 evidencing Restricted Stock that may
be purchased following the Grant of a Stock Purchase Right. 

 
 
        (ee)    "SAR Agreement"   means the agreement described in Section 9 evidencing a Grant of a Stock Appreciation Right.

 
 
        (ff)    "Securities Act"   means the United States Securities Act of 1933, as amended. 

 
 
        (gg)    "Service"   means service as an Employee, Director, Non-Employee Director or Consultant. A change in the capacity in
which the Participant renders service to the
Company or an Affiliate as an Employee, Consultant, Director or Non-Employee Director or a change in the entity for which the Participant renders such service, provided that there is no
interruption or termination of the Participant's service with the Company or an Affiliate, shall not terminate a Participant's Service. For example, a change in status from an Employee of the Company
to a Consultant of an Affiliate or a Director shall not constitute an interruption of Service. 

 
 
        (hh)    "Share"   means one share of Common Stock. 

 
 
        (ii)    "Stock Appreciation Right" or "SAR"   means a stock appreciation right
awarded under the Plan. 

 
 
        (jj)    "Stock Bonus"   means a stock bonus awarded under the Plan. 

 
 
        (kk)    "Stock Bonus Agreement"   means the agreement described in Section 10 evidencing each Grant of a Stock Bonus.

 
 
        (ll)    "Stock Option Agreement"   means the agreement described in Section 6 evidencing each Grant of an Option.

 
 
        (mm)    "Stock Purchase Right"   means the right to acquire Restricted Stock pursuant to Section 8. 

 
 
        (nn)    "Stock Unit"   means a bookkeeping entry representing the equivalent of a Share, as awarded under the Plan.

 
 
        (oo)    "Stock Unit Agreement"   means the agreement described in Section 8 evidencing a Grant of Stock Units.

 
 
        (pp)    "Subsidiary"   means a "subsidiary corporation," whether now or hereafter existing, as defined in section 424(f)
of the Code. 

 
 
        (qq)    "10-Percent Shareholder"   means an individual who owns more than ten percent (10%) of the total combined voting
power of all classes of outstanding stock of the Company, its Parent or any
of its Subsidiaries. In determining stock ownership, the attribution rules of section 424(d) of the Code shall be applied. 

 
 

SECTION 3.    ADMINISTRATION.    
    

 
 
        (a)    Administration by Board.     The Board shall administer the Plan and the Italy Sub-Plan unless and until the
Board delegates administration to a Committee, as provided in
Section 3(c). 

4

 

 
 
        (b)    Powers of Board.     The Board shall have the power, subject to, and within the limitations of, the express
provisions of the Plan and Italy Sub-Plan: 

          (i)  to
determine from time to time which of the persons eligible under the Plan or the Italy Sub-Plan shall be granted Awards or Italian Awards, as applicable;
when and how each Award or Italian Award shall be granted; what type or combination of types of Award or Italian Awards shall be granted; the provisions of each Award or Italian Awards granted (which
need not be identical), including the time or times when a person shall be permitted to receive Common Stock pursuant to a Award or Italian Award; and the number of Shares with respect to which an
Award or Italian Award shall be granted to each such person. 

         (ii)  to
construe and interpret the Plan, Italy Sub-Plan, Awards and Italian Awards granted under them, and to establish, amend and revoke rules and regulations
for its administration. The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan or the Italy Sub-Plan or in any Award Agreement or Italian
Award Agreement, in a manner and to the extent it shall deem necessary or expedient to make the Plan and Italy Sub-Plan fully effective. 

        (iii)  to
amend the Plan or an Award as provided in Section 15. 

        (iv)  to
terminate or suspend the Plan as provided in Section 15. 

         (v)  generally,
to exercise such powers and to perform such acts as the Board deems necessary or expedient to promote the best interests of the Company which are not in
conflict with the provisions of the Plan or Italy Sub-Plan. 

 
 
        (c)    Delegation to Committee.     

          (i)  The
Board may delegate administration of the Plan to a Committee or Committees of the Board, and the term "Committee" shall apply to persons to whom such authority has
been delegated. If administration is delegated to a Committee, the Committee shall have, in connection with the administration of the Plan, the powers theretofore possessed by the Board, including the
power to delegate to a subcommittee any of the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board shall thereafter be to the Committee or
subcommittee), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any
time and revest in the Board the administration of the Plan. 

         (ii)  With
respect to Awards granted to any Covered Employee, the Committee shall consist of those individuals who satisfy the requirements of "outside director" within the
meaning of section 162(m) of the Code (and the United State Treasury regulations promulgated thereunder) so that such Awards qualify for the performance-based compensation exemption of
section 162(m) of the Code. 

        With
respect to Awards granted to officers or directors of the Company (it's Parent, any Subsidiary or Affiliate) who are subject to section 16 of the Exchange Act, the Committee
shall consist of those individuals who shall satisfy the requirements of Rule 16b-3 (or its successor) under the Exchange Act ("Rule 16b-3"). Notwithstanding the
previous sentence, failure of the Committee to satisfy the requirements of Rule 16b-3 shall not invalidate any Awards granted by such Committee. 

        The
Board may also appoint one or more separate committees of the Board, each composed of directors of the Company who need not qualify under section 162(m) of the Code and/or
Rule 16b-3, that may administer the Plan with respect to Key Employees who are not considered Covered Employees nor officers or directors of the Company (it's Parent, any Subsidiary
or Affiliate) under section 16 of the Exchange Act, that may grant Awards under the Plan to such Key Employees, and that may determine all terms of such Awards. 

5

 

        Notwithstanding
the foregoing, the Board shall constitute the Committee and shall administer the Plan with respect to all Awards granted to Non-Employee Directors. 

 
 
        (d)    Effect of Board's Decision.     All determinations, interpretations and constructions made by the Board in
good faith shall not be subject to review by any person and shall be final, binding and
conclusive on all persons. 

 
 
        (e)    Indemnification.     Each member of the Committee, or of the Board, shall be indemnified and held harmless
by the Company against and from (i) any loss, cost, liability, or
expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or
she may be involved by reason of any action taken or failure to act under the Plan or Italy Sub-Plan or any Award Agreement or Italian Award Agreement, and (ii) from any and all
amounts paid by him or her in settlement thereof, with the Company's approval, or paid by him or her in satisfaction of any judgment in any such claim, action, suit, or proceeding against him or her,
provided he or she shall give the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing
right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company's Certificate of Incorporation or Bylaws, by contract, as
a matter of law, or otherwise, or under any power that the Company may have to indemnify them or hold them harmless. 

 
 

SECTION 4.    ELIGIBILITY.    
    

 
 
        (a)    General Rules.     Only Employees, Directors, Non-Employee Directors and Consultants who are liable for
income tax in the United States shall be eligible for designation
as Key Employees by the Committee. 

 
 
        (b)    Incentive Stock Options.     Only Key Employees who are common-law employees of the Company, its Parent or a
Subsidiary shall be eligible for the grant of ISOs. In addition, a Key
Employee who is a 10-Percent Shareholder shall not be eligible for the grant of an ISO unless the requirements set forth in section 422(c)(5) of the Code are satisfied. 

 
 
        (c)    Non-Employee Director Options.     Non-Employee Directors shall also be eligible to receive Options as
described in this Section 4(c) from and after the date the Board has
determined to implement this provision. 

          (i)  Each
eligible Non-Employee Director elected or appointed after the IPO Date shall automatically be granted an NSO to purchase 10,000 Shares (subject to
adjustment under Section 11(a)) as a result of his or her initial election or appointment as a Non-Employee Director. All NSOs granted pursuant to this
Section 4(c)(i) shall vest and become exercisable, provided the individual is serving as a Non-Employee Director of the Company as of the vesting date, as follows:
one-third of the total Shares subject to the NSO (rounded to nearest whole number) one year from the date of grant, then in 24 equal monthly installments commencing on the date one month
and one year after the date of grant. 

         (ii)  Upon
the conclusion of each regular annual meeting of the Company's shareholders following his or her initial appointment, each eligible Non-Employee
Director who will continue serving as a member of the Board thereafter shall receive an NSO to purchase 5,000 Shares (subject to adjustment under Section 11(a)). All NSOs granted pursuant to
this Section 4(c)(ii) shall vest and become exercisable provided the individual is serving as a Non-Employee Director of the Company as of the vesting date as follows:
one-twelfth of the total Shares subject to the NSO (rounded to nearest whole number) on each monthly anniversary of the date of grant. 

6

 

        (iii)  All
NSOs granted to Non-Employee Directors under this Section 4(c) shall become exercisable in full in the event of Change in Control with respect
to the Company. 

        (iv)  The
Exercise Price under all NSOs granted to a Non-Employee Director under this Section 4(c) shall be equal to one hundred percent (100%) of the Fair
Market Value of a Share on the date of grant, which shall be payable in one of the forms described in Section 7. 

         (v)  All
NSOs granted to a Non-Employee Director under this Section 4(c) shall terminate on the earlier of: 

        (A)  The
10th anniversary of the date of grant; or 

        (B)  The
date ninety (90) days after the termination of such Non-Employee Director's Service for any reason. 

 
 

SECTION 5.    SHARES SUBJECT TO PLAN.    
    

 
 
        (a)    Basic Limitation.     Subject to the provisions of Section 11(a), the stock issuable under the Plan and
the Italy Sub-Plan shall be authorized but unissued Shares or
treasury Shares. The aggregate number of Shares reserved for Awards under the Plan and for Italian Awards under the Italy Sub-Plan shall not exceed 1,500,000 Shares; provided, however,
that subject to the provisions of Section 11(a) of the Plan, the aggregate maximum number of Shares that may be issued in connection with ISOs shall be 1,500,000 Shares. 

 
 
        (b)    Additional Shares.     If Awards or Italian Awards are forfeited or terminate for any other reason before
being exercised, then the Shares underlying such Awards and Italian Awards
shall again become available for Awards under the Plan and Italian Awards under the Italy Sub-Plan. If SARs are exercised, then only the number of Shares (if any) actually issued in
settlement of such SARs shall reduce the number available under Section 5(a) and the balance shall again become available for Awards under the Plan and Italian Awards under the Italy
Sub-Plan. 

 
 
        (c)    Limits on Options and SARs.     No Key Employee shall receive Options to purchase Shares and/or SARs during
any fiscal year covering in excess of 500,000 Shares. Notwithstanding the foregoing
limitation, a Key Employee may receive Options to purchase Shares and/or SARs of up to 600,000 Shares in the first year of a Key Employee's employment with Company. 

 
 
        (d)    Limits on Stock Purchase Rights, Stock Units and Stock Bonuses.     No Key Employee shall receive an
Award(s) of Stock Purchase Rights, Stock Units and/or Stock Bonuses during any fiscal year covering in excess of 250,000 Shares.
Notwithstanding the foregoing limitation, a Key Employee may receive an Award(s) of Stock Purchase Rights, Stock Units and/or Stock Bonuses of up to 500,000 Shares in the first year of a Key
Employee's employment with Company. 

 
 

SECTION 6.    TERMS AND CONDITIONS OF OPTIONS.    
    

 
 
        (a)    Stock Option Agreement.     Each Grant of an Option under the Plan shall be evidenced by a Stock Option
Agreement between the Optionee and the Company. Such Option shall be subject to all
applicable terms and conditions of the Plan and may be subject to any other terms and conditions that are not inconsistent with the Plan and that the Committee deems appropriate for inclusion in a
Stock Option Agreement. The provisions of the various Stock Option Agreements entered into under the Plan need not be identical. A Stock Option Agreement may provide that new Options will be granted
automatically to the Optionee when he or she exercises the prior Options. The Stock Option Agreement shall also specify whether the Option is an ISO or an NSO. 

 
 
        (b)    Number of Shares.     Each Stock Option Agreement shall specify the number of Shares that are subject to the
Option and shall provide for the adjustment of such number in accordance
with Section 11(a). 

7

 

 
 
        (c)    Exercise Price.     An Option's Exercise Price shall be established by the Committee and set forth in a
Stock Option Agreement. The Exercise Price of an ISO shall not be less than
100% of the Fair Market Value (110% for 10-Percent Shareholders) of a Share on the date of Grant. In the case of an NSO, a Stock Option Agreement may specify an Exercise Price that varies
in accordance with a predetermined formula while the NSO is outstanding. 

 
 
        (d)    Exercisability and Term.     Each Stock Option Agreement shall specify the date when all or any installment
of the Option is to become exercisable. The Stock Option Agreement shall also
specify the term of the Option; provided that the term of an ISO shall in no event exceed ten (10) years from the date of Grant. An ISO that is granted to a 10-Percent Shareholder
shall have a maximum term of five (5) years. No Option can be exercised after the expiration date provided in the applicable Stock Option Agreement. A Stock Option Agreement may provide for
accelerated exercisability in the event of the Optionee's death, Disability or retirement or other events and may provide for expiration prior to the end of its term in the event of the termination of
the Optionee's Service. A Stock Option Agreement may permit an Optionee to exercise an Option before it is vested, subject to the Company's right of repurchase over any Shares acquired under the
unvested portion of the Option (an "early exercise"), which right of repurchase shall lapse at the same rate the Option would have vested had there been no early exercise. In no event shall the
Company be required to issue fractional Shares upon the exercise of an Option. 

 
 
        (e)    Modifications or Assumption of Options.     Within the limitations of the Plan, the Committee may modify,
extend or assume outstanding stock options or may accept the cancellation of outstanding stock
options (whether granted by the Company or by another issuer) in return for the grant of new Options for the same or a different number of Shares and at the same or a different Exercise Price. The
foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, alter or impair his or her rights or obligations under such Option. 

 
 
        (f)    Transferability of Options.     Except as otherwise provided in the applicable Stock Option Agreement and
then only to the extent permitted by applicable law, no Option shall be transferable by
the Optionee other than by will or by the laws of descent and distribution. Except as otherwise provided in the applicable Stock Option Agreement, an Option may be exercised during the lifetime of the
Optionee only or by the guardian or legal representative of the Optionee. No Option or interest therein may be assigned, pledged or hypothecated by the Optionee during his or her lifetime, whether by
operation of law or otherwise, or be made subject to execution, attachment or similar process. 

 
 
        (g)    Restrictions on Transfer.     Any Shares issued upon exercise of an Option shall be subject to such rights
of repurchase, rights of first refusal and other transfer restrictions as the
Committee may determine. Such restrictions shall apply in addition to any restrictions that may apply to holders of Shares generally and shall also comply to the extent necessary with applicable law. 

 
 
        (h)    Incentive Stock Option $100,000 Limitation.     To the extent that the aggregate Fair Market Value
(determined at the time of grant) of Common Stock with respect to which ISOs are exercisable for the first time
by any Optionee during any calendar year (under all plans of the Company and its Affiliates) exceeds one hundred thousand dollars ($100,000), the Options or portions thereof which exceed such limit
(according to the order in which they were granted) shall be treated as NSOs. 

 
 

SECTION 7.    PAYMENT FOR OPTION SHARES.    
    

 
 
        (a)    General Rule.     The entire Exercise Price of Shares issued upon exercise of Options shall be payable in
cash at the time when such Shares are purchased, except as follows: 

          (i)  In
the case of an ISO granted under the Plan, payment shall be made only pursuant to the express provisions of the applicable Stock Option Agreement. The Stock Option
Agreement may specify that payment may be made in any form(s) described in this Section 7. 

8

 

         (ii)  In
the case of an NSO granted under the Plan, the Committee may in its discretion, at any time accept payment in any form(s) described in this Section 7. 

 
 
        (b)    Surrender of Stock.     To the extent permitted under applicable laws, regulations and rules, and to the
extent that this Section 7(b) is applicable, payment for all or any part
of the Exercise Price may be made with Shares which have already been owned by the Optionee for such duration as shall be specified by the Committee. Such Shares shall be valued at their Fair Market
Value on the date when the new Shares are purchased under the Plan. 

 
 
        (c)    Cashless Exercise.     To the extent that this Section 7(c) is applicable, payment for all or any part
of the Exercise Price may be made through a "cashless exercise" program
established by the Company. 

 
 
        (d)    Other Forms of Payment.     To the extent that this Section 7(d) is applicable, payment may be made in
any other form that is consistent with applicable laws, regulations and rules. 

 
 

SECTION 8.    TERMS AND CONDITIONS FOR AWARDS OF STOCK PURCHASE RIGHTS AND STOCK UNITS.    
    

 
 
        (a)    Time, Amount and Form of Awards.     Awards under this Section 8 may be granted in the form of Stock
Purchase Rights, in the form of Stock Units, or in any combination of both. Such Awards may
also be awarded in combination with NSOs or SARs, and such an Award may provide that the Restricted Stock or Stock Units will be forfeited in the event that the related NSOs or SARs are exercised. 

 
 
        (b)    Restricted Stock and Stock Unit Agreements.     Each Grant of a Stock Purchase Right or Stock Units under
the Plan shall be evidenced by a Restricted Stock Agreement or Stock Unit Agreement between the
Participant and the Company. Such Awards shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions that are not inconsistent with the
Plan and that the Committee deems appropriate for inclusion in the applicable Award Agreement. The provisions of the various Award Agreements entered into under the Plan need not be identical. 

 
 
        (c)    Payment for Restricted Stock or Stock Unit Awards.     Restricted Stock or Stock Units may be issued with or
without cash consideration under the Plan. 

 
 
        (d)    Form and Time of Settlement of Stock Units.     Settlement of vested Stock Units may be made in the form of
(i) cash, (ii) Shares or (iii) any combination of both. The actual number of
Stock Units eligible for settlement may be larger or smaller than the number included in the original Award, based on predetermined performance factors. Methods of converting Stock Units into cash may
include (without limitation) a method based on the average Fair Market Value of Shares over a series of trading days. Vested Stock Units may be settled in a lump sum or in installments. The
distribution may occur or commence when all vesting conditions applicable to the Stock Units have been satisfied or have lapsed, or it may be deferred to any later date. The amount of a deferred
distribution may be increased by an interest factor or by dividend equivalents. Until an Grant of Stock Units is settled, the number of such Stock Units shall be subject to adjustment pursuant to
Section 11(a). 

 
 
        (e)    Vesting Conditions.     Each Grant of Restricted Stock or Stock Units shall become vested, in full or in
installments, upon satisfaction of the conditions specified in the applicable
Award Agreement. An Award Agreement may provide for accelerated vesting in the event of the Participant's death, Disability, retirement or other events. 

 
 
        (f)    Assignment or Transfer of Restricted Stock or Stock Units.     Except as provided in Section 14, or in
a Restricted Stock Agreement or Stock Unit Agreement, or as required by applicable law, a Restricted Stock or Stock
Unit Award granted under the Plan shall not be anticipated, assigned, 

9

 

attached,
garnished, optioned, transferred or made subject to any creditor's process, whether voluntarily, involuntarily or by operation of law. Any act in violation of this Section 8(f) shall
be void. However, this Section 8(f) shall not preclude a Participant from designating a beneficiary who will receive any outstanding Restricted Stock or Stock Unit Awards in the event of the
Participant's death, nor shall it preclude a transfer of Restricted Stock or Stock Unit Awards by will or by the laws of descent and distribution. 

 
 
        (g)    Death of Stock Units Recipient.     Any Stock Units Award that becomes payable after the Award recipient's
death shall be distributed to the recipient's beneficiary or beneficiaries. Each recipient
of a Stock Units Award under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with the Company. A beneficiary designation may be changed by filing the
prescribed form with the Company at any time before the recipient's death. If no beneficiary was designated or if no designated beneficiary survives the recipient, then any Stock Units Award that
becomes payable after the recipient's death shall be distributed to the recipient's estate. 

 
 
        (h)    Trusts.     Neither this Section 8 nor any other provision of the Plan shall preclude a Participant
from transferring or assigning Restricted Stock to (a) the
trustee of a trust that is revocable by such Participant alone, both at the time of the transfer or assignment and at all times thereafter prior to such Participant's death, or (b) the trustee
of any other trust to the extent approved in advance by the Committee in writing. A transfer or assignment of Restricted Stock from such trustee to any person other than such Participant shall be
permitted only to the extent approved in advance by the Committee in writing, and Restricted Stock held by such trustee shall be subject to all of the conditions and restrictions set forth in the Plan
and in the applicable Restricted Stock Agreement, as if such trustee were a party to such Restricted Stock Agreement. 

 
 
        (i)    Voting and Dividend Rights.     The holders of Restricted Stock awarded under the Plan shall have the same
voting, dividend and other rights as the Company's other shareholders. A Restricted
Stock Agreement, however, may require that the holders of Restricted Stock invest any cash dividends received in additional Restricted Stock. Such additional Restricted Stock shall be subject to the
same conditions and restrictions as the Award with respect to which the dividends were paid. Such additional Restricted Stock shall not reduce the number of Shares available under Section 5. 

 
 
        (j)    Stock Units Voting and Dividend Rights.     The holders of Stock Units shall have no voting rights. Prior to
settlement or forfeiture, any Stock Unit awarded under the Plan may, at the Committee's
discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash dividends paid on one Share while the Stock Unit is
outstanding. Dividend equivalents may be converted into additional Stock Units. Settlement of dividend equivalents may be made in the form of cash, in the form of Shares, or in a combination of both.
Prior to distribution, any dividend equivalents which are not paid shall be subject to the same conditions and restrictions as the Stock Units to which they attach. 

 
 
        (k)    Creditors' Rights.     A holder of Stock Units shall have no rights other than those of a general creditor
of the Company. Stock Units represent an unfunded and unsecured obligation of
the Company, subject to the terms and conditions of the applicable Stock Unit Agreement. 

 
 

SECTION 9.    TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS.    
    

 
 
        (a)    SAR Agreement.     Each Grant of a SAR under the Plan shall be evidenced by a SAR Agreement between the
Award recipient and the Company. Such SAR shall be subject to all applicable
terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various SAR Agreements entered into under the Plan need not be identical. SARs
may be granted in consideration of a reduction in the recipient other compensation. 

10

 

 
 
        (b)    Number of Shares.     Each SAR Agreement shall specify the number of Shares to which the SAR pertains and
shall provide for the adjustment of such number in accordance with
Section 11(a). 

 
 
        (c)    Exercise Price.     Each SAR Agreement shall specify the Exercise Price. A SAR Agreement may specify an
Exercise Price that varies in accordance with a predetermined formula while
the SAR is outstanding. 

 
 
        (d)    Exercisability and Term.     Each SAR Agreement shall specify the date when all or any installment of the
SAR is to become exercisable. The SAR Agreement shall also specify the term of the
SAR. A SAR Agreement may provide for accelerated exercisability in the event of the recipient's death, Disability, retirement or other events and may provide for expiration prior to the end of its
term in the event of the termination of the recipient's Service. SARs may also be awarded in combination with Options, Restricted Stock or Stock Units, and such an Award may provide that the SARs will
not be exercisable unless the related Options, Restricted Stock or Stock Units are forfeited. A SAR may be included in an ISO only at the time of Grant but may be included in an NSO at the time of
Grant or at any subsequent time, but not later than six months before the expiration of such NSO. A SAR granted under the Plan may provide that it will be exercisable only in the event of a Change in
Control. 

 
 
        (e)    Exercise of SARs.     If, on the date when a SAR expires, the Exercise Price under such SAR is less than the
Fair Market Value on such date but any portion of such SAR has not been
exercised or surrendered, then such SAR shall automatically be deemed to be exercised as of such date with respect to such portion. Upon exercise of a SAR, the recipient (or any person having the
right to exercise the SAR after his or her death) shall receive from the Company (i) Shares, (ii) cash or (iii) a combination of Shares and cash, as the Committee shall determine.
The amount of cash and/or the Fair Market Value of Shares received upon exercise of SARs shall, in the aggregate, be equal to the amount by which the Fair Market Value (on the date of surrender) of
the Shares subject to the SARs exceeds the Exercise Price. 

 
 
        (f)    Modification or Assumption of SARs.     Within the limitations of the Plan, the Committee may modify, extend
or assume outstanding stock appreciation rights or may accept the cancellation of outstanding
stock appreciation rights (whether granted by the Company or by another issuer) in return for the grant of new SARs for the same or a different number of Shares and at the same or a different Exercise
Price. The foregoing notwithstanding, no modification of a SAR shall, without the consent of the Optionee, alter or impair his or her rights or obligations under such SAR. 

 
 

SECTION 10.    TERMS AND CONDITIONS OF STOCK BONUSES    
    

 
 
        (a)    Stock Bonus Agreement.     Each Grant of a Stock Bonus under the Plan shall be evidenced by a Stock Bonus
Agreement between the Award recipient and the Company. Such Stock Bonus Agreement
shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Stock Bonus Agreements entered into
under the Plan need not be identical. Stock Bonuses may be granted in consideration of a reduction in the recipient's other compensation. 

 
 
        (b)    Number of Shares.     Each Stock Bonus Agreement shall specify the number of Shares to which the Stock Bonus
pertains and shall provide for the adjustment of such number in accordance
with Section 11(a). 

 
 
        (c)    Consideration.     A Stock Bonus may be issued with or without cash consideration under the Plan. A Stock
Bonus may be awarded in consideration for past services actually rendered
to the Company or an Affiliate for its benefit. 

 
 
        (d)    Vesting.     The Stock Bonus Agreement shall specify whether the Shares awarded under the Stock Bonus
Agreement are subject to a share repurchase right option in favor of the
Company in 

11

 

accordance
with a vesting schedule to be determined by the Committee. In the event the Service of a recipient of a Stock Bonus terminates, the Company may reacquire any or all of the Shares held by
the recipient which have not vested as of the date of termination under the terms of the Stock Bonus Agreement. 

 
 
        (e)    Transferability.     Except as provided in Section 14 or Stock Bonus Agreement, or as required by
applicable law, a Stock Bonus granted under the Plan shall not be anticipated,
assigned, attached, garnished, optioned, transferred or made subject to any creditor's process, whether voluntarily, involuntarily or by operation of law. Any act in violation of this
Section 10(e) shall be void. However, this Section 10(e) shall not preclude a recipient of a Stock Bonus from designating a beneficiary who will receive any outstanding Stock Bonus in
the event of the recipient's death, nor shall it preclude a transfer of a Stock Bonus by will or by the laws of descent and distribution. 

 
 
        (f)    Death of Stock Bonus Recipient.     Any Stock Bonus that becomes payable after the recipient's death shall
be distributed to the recipient's beneficiary or beneficiaries. Each recipient of a Stock
Bonus under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with the Company. A beneficiary designation may be changed by filing the prescribed form
with the Company at any time before the recipient's death. If no beneficiary was designated or if no designated beneficiary survives the recipient, then any Stock Bonus that becomes payable after the
recipient's death shall be distributed to the recipient's estate. 

 
 
        (g)    Trusts.     Neither this Section 10 nor any other provision of the Plan shall preclude a recipient of a
Stock Bonus from transferring or assigning the Stock Bonus to
(a) the trustee of a trust that is revocable by such recipient alone, both at the time of the transfer or assignment and at all times thereafter prior to such recipient death, or (b) the
trustee of any other trust to the extent approved in advance by the Committee in writing. A transfer or assignment of a Stock Bonus from such trustee to any person other than the recipient shall be
permitted only to the extent approved in advance by the Committee in writing, and the Stock Bonus held by such trustee shall be subject to all of the conditions and restrictions set forth in the Plan
and in the applicable Stock Bonus Agreement, as if such trustee were a party to such Stock Bonus Agreement. 

 
 
        (h)    Stock Bonus Voting and Dividend Rights.     The holders of a Stock Bonus shall have the same voting,
dividend and other rights as the Company's other shareholders. 

 
 

SECTION 11.    PROTECTION AGAINST DILUTION.    
    

 
 
        (a)    Adjustments.     In the event of a subdivision of the outstanding Shares, a declaration of a dividend
payable in Shares, a declaration of a dividend payable in a form other than
Shares in an amount that has a material effect on the price of Shares, a combination or consolidation of the outstanding Shares (by reclassification or otherwise) into a lesser number of Shares, a
recapitalization, reorganization, merger, liquidation, spin-off or a similar occurrence (all without the receipt of consideration), the Committee shall make such adjustments as it, in its
reasonable discretion, deems appropriate in order to prevent the dilution or enlargement of rights hereunder in one or more of: 

          (i)  the
number of Shares subject to automatic Grants under Section 4(c); the number of Shares available for future Awards or Italian Awards under
Section 5(a); the per person Share limits under Sections 5(c) and (d); 

         (ii)  the
number of Shares covered by each outstanding Award or Italian Award; or 

        (iii)  the
Exercise Price under each outstanding SAR, Option or Italian Stock Option. 

        Notwithstanding
anything in this Plan or the Italy Sub-Plan to the contrary, no adjustment shall be made with respect to any stock split occurring prior to the IPO Date. 

12

 

 
 
        (b)    Participant Rights.     Except as provided in this Section 11, a recipient of an Award or Italian Award
shall have no rights by reason of any issue by the Company of stock of any
class or securities convertible into stock of any class, any subdivision or consolidation of shares of stock of any class, the payment of any stock dividend or any other increase or decrease in the
number of shares of stock of any class. 

 
 

SECTION 12.    EFFECT OF A CORPORATE TRANSACTION.    
    

 
 
        (a)    Merger or Reorganization.     In the event that the Company is a party to a Corporate Transaction,
outstanding Awards shall be subject to the terms and conditions of the agreement
memorializing such Corporate Transaction. Such agreement may provide, without limitation, for the assumption or substitution of outstanding Awards by the surviving corporation or its parent, for their
continuation by the Company (if the Company is a surviving corporation), for accelerated vesting or for their cancellation with or without consideration. 

 
 
        (b)    Acceleration.     The Committee may determine, at the time of granting an Award, or thereafter, that such
Award shall become fully exercisable as to all Shares subject to such
Award in the event that a Change in Control occurs with respect to the Company. 

 
 

SECTION 13.    LIMITATIONS ON RIGHTS.    
    

 
 
        (a)    Retention Rights.     Neither the Plan nor any Award granted under the Plan shall be deemed to give any
individual a right to remain an Employee, Consultant or Director of the Company,
a Parent, a Subsidiary or an Affiliate. The Company and its Parents and Subsidiaries and Affiliates reserve the right to terminate the Service of any person at any time, and for any reason, subject to
applicable laws, the Company's Certificate of Incorporation and Bylaws and a written employment agreement (if any). 

 
 
        (b)    Shareholders' Rights.     A Participant shall have no dividend rights, voting rights or other rights as a
stockholder with respect to any Shares covered by his or her Award prior to the
issuance of a stock certificate for such Shares. No adjustment shall be made for cash dividends or other rights for which the record date is prior to the date when such certificate is issued, except
as expressly provided in Section 11. 

 
 
        (c)    Regulatory Requirements.     Any other provision of the Plan notwithstanding, the obligation of the Company
to issue Shares under the Plan shall be subject to all applicable laws, rules and
regulations and such approval by any regulatory body as may be required. The Company reserves the right to restrict, in whole or in part, the delivery of Shares pursuant to any Award prior to the
satisfaction of all legal requirements relating to the issuance of such Shares, to their registration, qualification or listing or to an exemption from registration, qualification or listing. 

 
 

SECTION 14.    WITHHOLDING TAXES.    
    

 
 
        (a)    General.     A Participant shall make arrangements satisfactory to the Company for the satisfaction of any
withholding tax obligations that arise in connection with his or her
Award. The Company shall not be required to issue any Shares or make any cash payment under the Plan until such obligations are satisfied. 

 
 
        (b)    Share Withholding.     If a public market for the Company's Shares exists, the Committee may permit a
Participant to satisfy all or part of his or her withholding or income tax
obligations by having the Company withhold all or a portion of any Shares that otherwise would be issued to him or her or by surrendering all or a portion of any Shares that he or she previously
acquired. Such Shares shall be valued at their Fair Market Value on the date when taxes otherwise would be withheld in cash. In no event may the Company allow Shares to be withheld in an amount that
exceeds the minimum statutory 

13

 

withholding
rates for federal, foreign and state tax purposes, including payroll taxes. Any payment of taxes by assigning Shares to the Company may be subject to restrictions, including, but not
limited to, any restrictions required by rules of the Securities and Exchange Commission. 

 
 

SECTION 15.    DURATION AND AMENDMENTS.    
    

 
 
        (a)    Term of the Plan.     The Plan shall become effective on the IPO Date, subject to the approval of the
Company's shareholders. No Options shall be exercisable until such shareholder
approval is obtained. In the event that the shareholders fail to approve the Plan within twelve (12) months after its adoption by the Board, any Awards made shall be null and void and no
additional Awards shall be made. The Plan shall terminate on the day before the tenth (10th) anniversary of the Adoption Date or on any earlier date pursuant to Section 15(b) of the Plan. 

 
 
        (b)    Right to Amend, Suspend or Terminate the Plan.     The Board may amend, suspend or terminate the Plan at any
time and for any reason. The suspension or termination of the Plan, or any amendment thereof, shall not
affect any Award previously granted under the Plan. No Awards shall be granted under the Plan after the Plan's suspension or termination. An amendment of the Plan shall be subject to the approval of
the Company's shareholders only to the extent required by applicable laws, regulations or rules. 

 
 
        (c)    Right to Amend Award.     The Board at any time, and from time to time, may amend the terms of any one or
more Awards; provided, however, that the rights under any Award shall not be
impaired by any such amendment unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing. 

 
 

SECTION 16.    EXECUTION.    
    

        To record the adoption of the Plan by the Board, the Company has caused its duly authorized officer to execute this Plan on behalf of the Company. 

	

 	
 	

GENTIUM S.P.A.
	

 	
 	

By	
 	

 
	 	 	 	 	

	

 	
 	

Title	
 	

 
	 	 	 	 	

14

 
 

APPENDIX A    
    
    GENTIUM S.P.A.
  2004 ITALY STOCK AWARD SUB-PLAN    
    

 
  SECTION 1. BACKGROUND AND PURPOSE    
    

        The purpose of this Italy Stock Award Sub-Plan (the "Italy Sub-Plan") is to advance the interest of the Company by enabling it and its
operating companies to attract and retain the best available personnel for positions of substantial responsibility in Italy and to provide Italian Key Employees of the Company and its controlling and
subsidiary companies, with an opportunity for investment in the Company; thereby giving them an additional incentive to increase their efforts on behalf of the long term success of the Company and its
operating companies. 

        It
is intended that Italian Awards granted under the Italy Sub-Plan shall qualify for the favorable tax and social security treatment applicable to stock grants or stock
options granted under applicable Italian law and in accordance with the relevant provisions set forth by Italian tax law and the Italian tax administration. The terms of the Italian
Sub-Plan shall be interpreted in accordance with the relevant provisions set forth by Italian tax and social security laws, as well as the Italian tax and social security administrations.
For Italian Awards granted under the Italy Sub-Plan, any conflict in terms between the Plan and the Italy Sub-Plan shall be governed by the terms in the Italy
Sub-Plan. 

 
 

SECTION 2. DEFINITION AND CONSTRUCTION    
    

        All capitalized terms used in this Italy Sub-Plan shall have the meaning ascribed to them in either the Italy Sub-Plan or the Plan. Terms
not defined in the Italy Sub-Plan or the Plan, shall be given their normal and ordinary meaning. 

        (a)   "Italian
Employee" means any individual employed by the Company or a controlling or subsidiary company who resides in the Republic of Italy and who is liable for income
tax in the Republic of Italy. 

        (b)   "Exercise
Price" means (1) when the Company's Common Stock is traded on a regulated market as defined under applicable Italian law, the average of the closing
price quoted by the NASDAQ system over the preceding 30 days and (2) when the Company's Common Stock is not on a regulated market as defined under applicable Italian law, the
proportionate value of the net worth of the Company determined by the Board in good faith and on such basis as it deems appropriate, taking applicable regulations into account. 

        (c)   "Italy
Sub-Plan" means the provisions contained herein as Appendix A the Plan to be known as the Gentium S.p.A. 2004 Italy Stock Award
Sub-Plan, as the same may be amended from time to time. 

        (d)   "Italian
Award" means an Italian Stock Option or an Italian Stock Grant. 

        (e)   "Italian
Award Agreement" means a written agreement between the Company and an Italian Key Employee evidencing the terms and conditions of a grant of an individual
Italian Award. Each Italian Award Agreement shall be subject to the terms and conditions of the Italy Sub-Plan. 

        (f)    "Italian
Key Employee" means an Italian Employee who is liable for income tax in Italy or any person eligible to receive an Italian Award under Articles 2349 and
2441 of the Italian Civil Code who is liable for income tax in Italy and who has been selected by the Committee to receive an Italian Award under the Italy Sub-Plan. 

        (g)   "Italian
Stock Grant" means a stock grant to acquire Shares pursuant to Article 2349 of the Italian Civil Code. 

        (h)   "Italian
Stock Grant Agreement" means the agreement described in Section 5 of the Italy Sub-Plan. 

 

        (i)    "Italian
Stock Option" means a stock option to acquire Shares pursuant to Article 2441 of the Italian Civil Code. 

        (j)    "Italian
Stock Option Agreement" means the agreement described in Section 4 of the Italy Sub-Plan. 

 
 

SECTION 3. INCORPORATION OF PLAN    
    

        This Italy Sub-Plan shall be ancillary to the Plan. The provisions of this Italy Sub-Plan shall be applicable only to Italian Key
Employees who have or shall have a liability for Italian income tax with respect to an Italian Award For the avoidance of doubt, this Italy Sub-Plan does not apply to any Key Employee or
Participant who does not have Italy income tax liability with respect to their Award. 

 
 

SECTION 4. ITALIAN STOCK OPTION TERMS    
    

 
 
        (a)    Italian Stock Option Agreement.     Each grant of an Italian Stock Option under the Italy Sub-Plan shall be
evidenced by an Italian Stock Option Agreement between the Italian Key
Employee and the Company. Such Italian Stock Option shall be subject to all applicable terms and conditions of the Italy Sub-Plan and may be subject to any other terms and conditions that
are not inconsistent with the Italy Sub-Plan and that the Board deems appropriate for inclusion in an Italian Stock Option Agreement. The provisions of the various Italian Stock Option
Agreements entered into under the Italy Sub-Plan need not be identical. 

 
 
        (b)    Number of Shares.     Each Italian Stock Option Agreement shall specify the number of Shares that are
subject to the Italian Stock Option and shall provide for the adjustment of such
number in accordance with Section 11(a) of the Plan. Notwithstanding the foregoing, no Italian Key Employee shall receive Italian Stock Options to purchase Shares in excess of 10% of the voting
rights in the annual meeting of shareholders or 10% of the capital or equity of the Company. 

 
 
        (c)    Exercise Price.     An Italian Stock Option's Exercise Price shall be established by the Board and set forth
in the Italian Stock Option Agreement. 

 
 
        (d)    Exercisability and Term.     Each Italian Stock Option Agreement shall specify the date when all or any
installment of the Italian Stock Option is to become exercisable. The Italian Stock
Option Agreement shall also specify the term of the Italian Stock Option, provided that the Italian Stock Option shall terminate prior to the end of its term if the Italian Key Employee's Service with
the Company terminates. No Italian Stock Option can be exercised after the expiration date provided in the applicable Italian Stock Option Agreement. 

 
 
        (e)    Withholding Obligations.     The recipient of an Italian Stock Option shall make arrangements satisfactory
to the Company for the satisfaction of any withholding tax obligations that arise in
connection with his or her Italian Stock Option. The Company shall not be required to issue any Shares until such obligations are satisfied. 

 
 
        (f)    Transferability.     Except as otherwise provided in the applicable Italian Stock Option Agreement and then
only to the extent permitted by applicable law, no Italian Stock Option
shall be transferable by the Italian Key Employee other than by will or by the laws of descent and distribution. No Italian Stock Option or interest therein may be assigned, pledged or hypothecated by
the Italian Key Employee during his or her lifetime, whether by operation of law or otherwise, or be made subject to execution, attachment or similar process. 

 
 

SECTION 5. ITALIAN STOCK GRANT TERMS    
    

 
 
        (a)    Italian Stock Grant Agreement.     Each grant of an Italian Stock Grant under the Italy Sub-Plan shall be
evidenced by an Italian Stock Grant Agreement between the Italian Key Employee 

2

 

and
the Company. Such Italians Stock Grant Agreement shall be subject to all applicable terms of the Italy Sub-Plan and may be subject to any other terms that are not inconsistent with the
Italy Sub-Plan. The provisions of the various Italian Stock Grant Agreements entered into under the Italy Sub-Plan need not be identical. 

 
 
        (b)    Number of Shares.     Each Italian Stock Grant Agreement shall specify the number of Shares to which the
Italian Stock Grant pertains and shall provide for the adjustment of such
number in accordance with Section 11(a) of the Plan. 

 
 
        (c)    Consideration.     An Italian Stock Grant shall be awarded in consideration for past services actually
rendered to the Company or any of its controlling or subsidiary companies. 

 
 
        (d)    Vesting     The Shares awarded under an Italian Stock Grant shall be subject to forfeiture in accordance
with a vesting schedule to be determined by the Board. 

 
 
        (e)    Withholding Obligations     The recipient of an Italian Stock Grant shall make arrangements satisfactory to
the Company for the satisfaction of any withholding tax obligations that arise in
connection with his or her Italian Stock Grant. The Company shall not be required to issue any Shares until such obligations are satisfied. 

 
 
        (f)    Transferability     Except as otherwise provided in the applicable Italian Stock Grant Agreement and then
only to the extent permitted by applicable law, no Italian Stock Grant shall
be transferable by the Italian Key Employee. No Italian Stock Grant or interest therein may be assigned, pledged or hypothecated by the Italian Key Employee during his lifetime, whether by operation
of law or otherwise, or be made subject to execution, attachment or similar process. 

 
 

SECTION 6. EFFECT OF A CORPORATE TRANSACTION.    
    

 
 
        (a)    Merger or Reorganization.     In the event that the Company is a party to a Corporate Transaction,
outstanding Italian Awards shall be subject to the terms and conditions of the agreement
memorializing such Corporate Transaction. Such agreement may provide, without limitation, for the assumption or substitution of outstanding Italian Awards by the surviving corporation or its parent,
for their continuation by the Company (if the Company is a surviving corporation), for accelerated vesting or for their cancellation with or without consideration. 

 
 
        (b)    Acceleration.     The Board may determine, at the time of granting an Italian Award, or thereafter, that
such Italian Award shall become fully exercisable as to all Shares subject
to such Italian Award in the event that a Change in Control occurs with respect to the Company. 

 
 

SECTION 7. LIMITATIONS ON RIGHTS.    
    

 
 
        (a)    Retention Rights.     Neither the Italy Sub-Plan nor any Italian Award granted under the Italy Sub-Plan
shall be deemed to give any individual a right to remain
an employee, consultant or director of the Company and its controlling and subsidiary companies. The Company and its controlling and subsidiary companies reserve the right to terminate the Service of
any person at any time, and for any reason, subject to applicable laws, the Company's Certificate of Incorporation and Bylaws and a written employment agreement (if any). 

 
 
        (b)    Shareholders' Rights.     A recipient of an Italian Award shall have no dividend rights, voting rights or
other rights as a shareholder with respect to any Shares covered by his or her
Italian Award prior to the issuance of a stock certificate for such Shares. No adjustment shall be made for cash dividends or other rights for which the record date is prior to the date when such
certificate is issued, except as expressly provided in Section 11 of the Plan. 

 
 
        (c)    Regulatory Requirements.     Any other provision of the Italy Sub-Plan notwithstanding, the obligation of
the Company to issue Shares under the Italy Sub-Plan shall be
subject to all applicable 

3

 

laws,
rules and regulations and such approval by any regulatory body as may be required. The Company reserves the right to restrict, in whole or in part, the delivery of Shares pursuant to any Italian
Award prior to the satisfaction of all legal requirements relating to the issuance of such Shares, to their registration, qualification or listing or to an exemption from registration, qualification
or listing. 

 
 

SECTION 8. DURATION AND AMENDMENTS.    
    

 
 
        (a)    Term of the Italy Sub-Plan.     The Italy Sub-Plan shall become effective on the IPO Date, subject to the
approval of the Company's shareholders. No Italian Stock Option shall be
exercisable until such shareholder approval is obtained. In the event that the shareholders fail to approve the Italy Sub-Plan, any Italian Awards made shall be null and void and no
additional Italian Awards shall be made. The Italy Sub-Plan shall terminate on the day before the tenth (10th) anniversary of the Adoption Date or on any earlier date pursuant to
Section 8(b) of the Italy Sub-Plan. 

 
 
        (b)    Right to Amend, Suspend or Terminate the Italy Sub-Plan.     The Board may amend, suspend or terminate the
Italy Sub-Plan at any time and for any reason. The suspension or termination of the Italy
Sub-Plan, or any amendment thereof, shall not affect any Italian Award previously granted under the Italy Sub-Plan. No Italian Awards shall be granted under the Italy
Sub-Plan after the Italy Sub-Plan's suspension or termination. An amendment of the Italy Sub-Plan shall be subject to the approval of the Company's shareholders
only to the extent required by applicable laws, regulations or rules. 

 
 
        (c)    Right to Amend Italian Award     The Board at any time, and from time to time, may amend the terms of any
one or more Italian Awards; provided, however, that the rights under any Italian Award
shall not be impaired by any such amendment unless (i) the Company requests the consent of the recipient of such Italian Award and (ii) the recipient of such Italian Award consents in
writing. 

 
 

SECTION 9. EXECUTION.    
    

        To record the adoption of the Italy Sub-Plan by the Board, the Company has caused its duly authorized officer to execute this Italy
Sub-Plan on behalf of the Company. 

	 	 	GENTIUM S.P.A.
	

 	
 	

By	
 	

    

	

 	
 	

Title	
 	

    

4

QuickLinks

Exhibit 10.1

SECTION 1. PURPOSE.

SECTION 2. DEFINITIONS.

(a)  "Affiliate"

(b)  "Award"

(c)  "Award Agreement"

(d)  "Board"

(e)  "Change In Control"

(f)  "Code"

(g)  "Committee"

(h)  "Common Stock"

(i)  "Company"

(j)  "Consultant"

(k)  "Corporate Transaction"

(l)  "Covered Employee"

(m)  "Director"

(n)  "Disability"

(o)  "Employee"

(p)  "Exchange Act"

(q)  "Exercise Price"

(r)  "Fair Market Value"

(s)  "Grant"

(t)  "Incentive Stock Option" or "ISO"

(u)  "Key Employee"

(v)  "Non-Employee Director"

(w)  "Nonstatutory Stock Option" or "NSO"

(x)  "Option"

(y)  "Optionee"

(z)  "Parent"

(aa)  "Participant"

(bb)  "Plan"

(cc)  "Restricted Stock"

(dd)  "Restricted Stock Agreement"

(ee)  "SAR Agreement"

(ff)  "Securities Act"

(gg)  "Service"

(hh)  "Share"

(ii)  "Stock Appreciation Right" or "SAR"

(jj)  "Stock Bonus"

(kk)  "Stock Bonus Agreement"

(ll)  "Stock Option Agreement"

(mm)  "Stock Purchase Right"

(nn)  "Stock Unit"

(oo)  "Stock Unit Agreement"

(pp)  "Subsidiary"

(qq)  "10-Percent Shareholder"

SECTION 3. ADMINISTRATION.

(a)  Administration by Board.

(b)  Powers of Board.

(c)  Delegation to Committee.

(d)  Effect of Board's Decision.

(e)  Indemnification.

SECTION 4. ELIGIBILITY.

(a)  General Rules.

(b)  Incentive Stock Options.

(c)  Non-Employee Director Options.

SECTION 5. SHARES SUBJECT TO PLAN.

(a)  Basic Limitation.

(b)  Additional Shares.

(c)  Limits on Options and SARs.

(d)  Limits on Stock Purchase Rights, Stock Units and Stock Bonuses.

SECTION 6. TERMS AND CONDITIONS OF OPTIONS.

(a)  Stock Option Agreement.

(b)  Number of Shares.

(c)  Exercise Price.

(d)  Exercisability and Term.

(e)  Modifications or Assumption of Options.

(f)  Transferability of Options.

(g)  Restrictions on Transfer.

(h)  Incentive Stock Option $100,000 Limitation.

SECTION 7. PAYMENT FOR OPTION SHARES.

(a)  General Rule.

(b)  Surrender of Stock.

(c)  Cashless Exercise.

(d)  Other Forms of Payment.

SECTION 8. TERMS AND CONDITIONS FOR AWARDS OF STOCK PURCHASE RIGHTS AND STOCK UNITS.

(a)  Time, Amount and Form of Awards.

(b)  Restricted Stock and Stock Unit Agreements.

(c)  Payment for Restricted Stock or Stock Unit Awards.

(d)  Form and Time of Settlement of Stock Units.

(e)  Vesting Conditions.

(f)  Assignment or Transfer of Restricted Stock or Stock Units.

(g)  Death of Stock Units Recipient.

(h)  Trusts.

(i)  Voting and Dividend Rights.

(j)  Stock Units Voting and Dividend Rights.

(k)  Creditors' Rights.

SECTION 9. TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS.

(a)  SAR Agreement.

(b)  Number of Shares.

(c)  Exercise Price.

(d)  Exercisability and Term.

(e)  Exercise of SARs.

(f)  Modification or Assumption of SARs.

SECTION 10. TERMS AND CONDITIONS OF STOCK BONUSES

(a)  Stock Bonus Agreement.

(b)  Number of Shares.

(c)  Consideration.

(d)  Vesting.

(e)  Transferability.

(f)  Death of Stock Bonus Recipient.

(g)  Trusts.

(h)  Stock Bonus Voting and Dividend Rights.

SECTION 11. PROTECTION AGAINST DILUTION.

(a)  Adjustments.

(b)  Participant Rights.

SECTION 12. EFFECT OF A CORPORATE TRANSACTION.

(a)  Merger or Reorganization.

(b)  Acceleration.

SECTION 13. LIMITATIONS ON RIGHTS.

(a)  Retention Rights.

(b)  Shareholders' Rights.

(c)  Regulatory Requirements.

SECTION 14. WITHHOLDING TAXES.

(a)  General.

(b)  Share Withholding.

SECTION 15. DURATION AND AMENDMENTS.

(a)  Term of the Plan.

(b)  Right to Amend, Suspend or Terminate the Plan.

(c)  Right to Amend Award.

SECTION 16. EXECUTION.

APPENDIX A GENTIUM S.P.A. 2004 ITALY STOCK AWARD SUB-PLAN

SECTION 1. BACKGROUND AND PURPOSE

SECTION 2. DEFINITION AND CONSTRUCTION

SECTION 3. INCORPORATION OF PLAN

SECTION 4. ITALIAN STOCK OPTION TERMS

(a)  Italian Stock Option Agreement.

(b)  Number of Shares.

(c)  Exercise Price.

(d)  Exercisability and Term.

(e)  Withholding Obligations.

(f)  Transferability.

SECTION 5. ITALIAN STOCK GRANT TERMS

(a)  Italian Stock Grant Agreement.

(b)  Number of Shares.

(c)  Consideration.

(d)  Vesting

(e)  Withholding Obligations

(f)  Transferability

SECTION 6. EFFECT OF A CORPORATE TRANSACTION.

(a)  Merger or Reorganization.

(b)  Acceleration.

SECTION 7. LIMITATIONS ON RIGHTS.

(a)  Retention Rights.

(b)  Shareholders' Rights.

(c)  Regulatory Requirements.

SECTION 8. DURATION AND AMENDMENTS.

(a)  Term of the Italy Sub-Plan.

(b)  Right to Amend, Suspend or Terminate the Italy Sub-Plan.

(c)  Right to Amend Italian Award

SECTION 9. EXECUTION.

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