Form 8-K UNIVERSAL BIOSENSORS For: Aug 19

September 17, 2021 6:04 AM EDT

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Exhibit 10.1

 

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Rules of Universal Biosensors Inc. Option Plan

 

1

Definitions and interpretation

 

1.1

Definitions

 

In these Rules, unless the contrary intention appears:

 

 

(1)

Accelerated Vesting Event means the occurrence of:

 

 

(a)

a Special Circumstance in respect of a Participant; or

 

 

(b)

a Control Event;

 

 

(2)

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

 

 

(a)

the Corporations Act;

 

 

(b)

Corporations Regulations;

 

 

(c)

the Listing Rules;

 

 

(d)

the ASX Settlement Operating Rules;

 

 

(e)

the Tax Act;

 

 

(f)

the Tax Administration Act;

 

 

(g)

any other applicable practice note, policy statement, class order, declaration, guideline, policy, procedure, ruling or guidance note made to clarify or expand any of (a) to (f) above; and

 

 

(h)

the Constitution;

 

 

(3)

ASIC means the Australian Securities and Investments Commission;

 

 

(4)

Associated Company means at any time any body corporate that at that time is a related body corporate of the Company within the meaning of section 50 of the Corporations Act;

 

 

(5)

ASX Settlement Operating Rules means the operating rules of ASX Settlement Pty Limited ACN 008 504 532;

 

 

(6)

ASX means ASX Limited ACN 008 624 691 or a market conducted by it (as the context requires);

 

 

(7)

Board means all or some of the Directors of the Company acting as a board or, where appropriate, a committee of the Board;

 

 

(8)

Bonus Issue means a Pro Rata Issue of CDIs to holders of CDIs for which no consideration is payable by them;

 

 

(9)

Business Day has the meaning given to that term in the Listing Rules;

 

 

(10)

CDI means a chess depositary interest, representing a Share in the capital of the Company;

 

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(11)

Certificate means, with respect to an Option, a certificate issued under these Rules in the form approved by the Plan Committee from time to time;

 

 

(12)

Company means Universal Biosensors Inc. ARBN 51 121 559 993;

 

 

(13)

Constitution means the Company’s constitution;

 

 

(14)

Control of an entity means having the right:

 

 

(a)

to vote 70% (or more) of the votes that can be cast on the election or removal of the entity’s directors;

 

 

(b)

to appoint or remove directors who possess 50% (or more) of the votes exercisable by all directors of the entity; or

 

 

(c)

to 70% (or more) of the profits or distributions of the entity or of its net liquidation proceeds.

 

For this definition, if the entity does not have a board of directors, ‘director’ means a member of the entity’s governing body with a role similar to a board of directors;

 

 

(15)

Control Event means any of the following:

 

 

(a)

an offer is made by a person to acquire all of the CDIs (or any CDIs that are not at the time owned by the offeror or any person acting in concert with the offeror) and, after announcement of the offer, the offeror (being a person who did not Control the Company prior to the offer) acquires Control of the Company;

 

 

(b)

any other event occurs which causes a change in Control of the Company; or

 

 

(c)

any other event which the Plan Committee reasonably considers should be regarded as a Control Event;

 

 

(16)

Corporations Act means the Corporations Act 2001 (Cth);

 

 

(17)

Corporations Regulations means any and all regulations made under the Corporations Act;

 

 

(18)

Date of Grant means, with respect to an Option, the date on which the Plan Committee grants the Option to You;

 

 

(19)

Director means a person holding the office of director;

 

 

(20)

Dispose includes sell, assign, transfer or otherwise encumber;

 

 

(21)

Employee means a person in respect of whom the Company or a Subsidiary of the Company is the employer or is deemed to be the employer for the purposes of section 83A-35 of the Tax Act;

 

 

(22)

Exercise Date means the date on which a Notice of Exercise is provided to the Company;

 

 

(23)

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

 

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(24)

Exercise Price means the subscription price per CDI payable by the holder of an Option on the exercise of the Option, being the amount determined in accordance with Rule 5.5;

 

 

(25)

First Exercise Date with respect to an Option means the day of the Vesting Date;

 

 

(26)

Group means the Company and each Group Company;

 

 

(27)

Group Company means:

 

 

(a)

a Holding Company or Subsidiary of the Company; and

 

 

(b)

a Subsidiary of the Holding Company of the Company;

 

 

(28)

Last Exercise Date with respect to an Option means, unless otherwise specified in a Certificate in respect of that Option:

 

 

(a)

the date 4 years after the Date of Grant for Tranche 1;

 

 

(b)

the date 5 years after the Date of Grant for Tranche 2 and 3; or

 

 

(c)

if a Special Circumstance arises in respect of a Participant during those periods, then the date 12 months (or such longer period as may be determined by the Plan Committee) after the Special Circumstance arises;

 

 

(29)

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

 

 

(30)

Listing Rules means the ASX Listing Rules;

 

 

(31)

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

 

 

(32)

Official Quotation has the meaning given to it in the Listing Rules;

 

 

(33)

Option means a right issued to You to subscribe for a CDI on payment of the Exercise Price and otherwise on the terms and conditions of this Plan;

 

 

(34)

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

 

 

(35)

Plan means the Company’s Option Plan governed by these Rules;

 

 

(36)

Plan Committee means the Nomination and Remuneration Committee or another committee of the Board to which power to administer the Plan has been delegated or if there has been no delegation, the Board;

 

 

(37)

Pro Rata Issue has the meaning given in the Listing Rules;

 

 

(38)

Purpose means, in relation to the collection of personal information as contemplated by Rule 20, the facilitation of the operation and the administration of the Plan;

 

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(39)

Redundancy means the termination or cessation of a Participant's employment or office with the Company and all Group Companies due to a determination that the need to employ a person for the particular kind of work carried out by that Participant has ceased (but, for the avoidance of any doubt, does not include the dismissal of any Participant for personal or disciplinary reasons or where the Participant leaves the employ of the Company of his or her own accord);

 

 

(40)

Related Body Corporate, Subsidiary and Holding Company each has the meaning given in section 9 of the Corporations Act;

 

 

(41)

Rules means this document, including any schedule or annexure to it;

 

 

(42)

Security Interest means:

 

 

(a)

a mortgage, charge, assignment by way of security, pledge, lien, hypothecation, title retention arrangement, encumbrance or other third party interest of any nature;

 

 

(b)

any arrangement having a commercial effect equivalent to anything in (a); and

 

 

(c)

any agreement to create an interest described in (a) or an arrangement described in (b);

 

 

(43)

Share means a fully paid ordinary share in the capital of the Company;

 

 

(44)

Shareholder means a holder of a CDI or CDIs;

 

 

(45)

Securities Act means the U.S. Securities Act of 1933 as amended from time to time;

 

 

(46)

Securities Trading Policy means the Company’s trading policy with respect to CDIs;

 

 

(47)

Special Circumstance means with respect to a Participant:

 

 

(a)

Total and Permanent Disablement;

 

 

(b)

death; and

 

 

(c)

Redundancy;

 

 

(48)

Specific Terms means, in relation to an invitation to participate under the Plan, the specific terms and conditions (including any terms and condition under Rule 5.2(5)) of the invitation;

 

 

(49)

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

 

 

(50)

Tax Act means the Income Tax Assessment Act 1936 (Cth) or the Income Tax Assessment Act 1997 (Cth) or both, as the context requires;

 

 

(51)

Tax Administration Act means the Taxation Administration Act 1953 (Cth);

 

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(52)

Total and Permanent Disablement means, in relation to any Participant, that the Participant has, in the opinion of the Plan Committee (such opinion to be reasonably held), after considering such medical and other evidence as it sees fit, become incapacitated to such an extent as to render the Participant unlikely ever to engage in any occupation for which he is reasonably qualified by education, training or experience;

 

 

(53)

Vesting Conditions has the meaning given in Rule 6.2; and

 

 

(54)

Vesting Date means the date specified in a Certificate in respect of the Option or, if no date is specified, then the third anniversary of the Date of Grant of the Option; or such other date as the Plan Committee in accordance with Rule 6.3 may substitute for that date.

 

1.2

Interpretation

 

In these Rules, unless the context otherwise requires:

 

 

(1)

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

 

 

(2)

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

 

 

(3)

words denoting the singular include the plural and vice versa;

 

 

(4)

words denoting a gender include the other genders;

 

 

(5)

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

 

 

(6)

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

 

 

(7)

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

 

 

(8)

a reference to the Constitution includes a reference to any provision having substantially the same effect which is substituted for or replaces the Constitution;

 

 

(9)

a Participant does not cease to be employed by a company in the Group where the Participant ceases to be employed by a company in the Group, but contemporaneously commences employment with another company in the Group;

 

 

(10)

reference to time is a reference to the time in Melbourne, Australia; and

 

 

(11)

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

 

1.3

Primary instruments

 

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

 

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2

The Plan

 

The purpose of the Plan is to provide You with an opportunity to share in the growth in value of the CDIs and to encourage them to improve the performance of the Company and its return to Shareholders. It is intended that the Plan will enable the Group to retain and attract skilled and experienced employees and provide You with the motivation to make the Group more successful.

 

3

Principal conditions

 

3.1

Options issued only to Employees

 

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

 

3.2

Compliance with laws

 

No Option may be issued to, or exercised by, You, and the Company is not obliged to issue any CDIs to You on the exercise of any Option, if to do so would contravene an Applicable Law, including Listing Rules 6.15 to 6.24 and 10.11 to 10.14.

 

4

Operation of the Plan

 

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

 

5

Issue of Options

 

5.1

Plan Committee may determine issue

 

Subject to these Rules, the Plan Committee may from time to time determine that the Company will offer additional Options to You.

 

5.2

Form of invitation

 

The Board must give to You an Application to complete, sign and return to the Company, together with the following information:

 

 

(1)

either:

 

 

(a)

the number of Options to which the invitation relates; or

 

 

(b)

the basis on which the number of Options to which the invitation relates is to be determined;

 

 

(2)

either:

 

 

(a)

the Vesting Date and the Last Exercise Date; or

 

 

(b)

the basis on which the Vesting Date and the Last Exercise Date are to be determined;

 

 

(3)

either:

 

 

(a)

the Exercise Price; or

 

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(b)

the basis on which the Exercise Price is to be determined;

 

 

(4)

the performance conditions attaching to the Options (if any);

 

 

(5)

any other terms and conditions relating to the grant of the Options or the delivery of any CDIs on exercise of the Options which, in the opinion of the Plan Committee, are fair and reasonable but not inconsistent with these Rules,

 

and the following documents:

 

 

(6)

a summary or a copy of these Rules; and

 

 

(7)

any other information or documents that the Applicable Laws require the Company to give to You.

 

5.3

Offer and acceptance

 

By completing, signing and returning the Application given to You under Rule 5.2, You offer to participate under the Plan and, on acceptance by the Plan Committee of the offer a contract is formed between the Company and You on the terms and conditions of:

 

 

(1)

these Rules; and

 

 

(2)

the Specific Terms.

 

5.4

Limit on Number of Options

 

The number of Options the subject of the offer to You is as determined by the Plan Committee.

 

5.5

Exercise Price

 

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

 

5.6

Exercise Price in Australian dollars

 

Subject to Rule 7.4, the Exercise Price in respect of an Option must be denominated and payable in Australian dollars.

 

5.7

Becoming a Participant

 

On the issue of an Option to You, You become a Participant and are bound by these Rules.

 

5.8

Certificates

 

The Company must give a Participant one or more Certificates stating (or which, if applicable, attaches a separate document stating):

 

 

(1)

the number of Options issued to the Participant;

 

 

(2)

the Exercise Price of those Options or the basis on which it is to be determined;

 

 

(3)

the Date of Grant of those Options;

 

 

(4)

the Vesting Date of the Options or the basis on which it is to be determined;

 

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(5)

the expected Last Exercise Date of the Options or the basis on which it is to be determined; and

 

 

(6)

any other specific terms and conditions applicable.

 

5.9

Consideration for Options

 

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

 

5.10

Entitlement to CDIs

 

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

 

5.11

Quotation of Options

 

The Company will not apply for Official Quotation of any Options.

 

5.12

Interest in CDIs

 

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

 

6

Vesting of Options

 

6.1

Vesting

 

Subject to Rule 6.2, an Option vests on the Vesting Date.

 

6.2

Vesting Conditions

 

Subject to Rule 6.3, the vesting of any Option held by the Participant is subject to, the Participant having been an employee, or a deemed employee for the purposes of section 83A-35 of the Tax Act, of a company within the Group at all times between the Date of Grant and the Vesting Date (inclusive).

 

6.3

Vesting brought forward

 

 

(1)

If an Accelerated Vesting Event occurs while a Participant is employed with the Group and before the Vesting Date, the Plan Committee may, at its discretion:

 

 

(a)

bring forward the vesting of all Options held by the Participant to a date determined by the Plan Committee; and

 

 

(b)

waive or vary any Vesting Conditions in regard to any Options.

 

 

(2)

If the Plan Committee determines to bring forward the vesting of an Option and waive or vary the Vesting Conditions under Rule 6.3(1)(a), the Company:

 

 

(a)

must within 14 days of the alteration give notice to each Participant affected by the Accelerated Vesting Event in respect of the Option held by the Participant; and

 

 

(b)

may issue a replacement Certificate for the Option.

 

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6.4

Lapse of unvested Options

 

Subject to Rule 6.5, if the Vesting Conditions in relation to an Option are not satisfied before 5pm on the Vesting Date, the Options will lapse at 5pm on the Vesting Date (or the earlier date on which the Participant ceases to be an employee of the Company).

 

6.5

Waiver of Vesting Conditions

 

The Plan Committee may, at its discretion, by notice to the Participant waive or vary any Vesting Conditions in regard to any Option at any time.

 

7

Exercise of Options

 

7.1

Exercise during Exercise Period

 

Subject to these Rules and the terms on which an Option is issued, an Option may be exercised at any time during the Exercise Period for that Option.

 

7.2

Exercise before Exercise Period

 

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

 

7.3

Exercise of Options

 

Subject to these Rules, an Option which has not lapsed may be exercised by the Participant giving to the Company:

 

 

(1)

a Notice of Exercise signed by the Participant;

 

 

(2)

the Certificate for the Option; and

 

 

(3)

subject to Rule 7.4, a cheque payable to the Company (or another form of payment acceptable to the Board) in the amount being the product of:

 

 

(a)

the number of Options then being exercised by the Participant; and

 

 

(b)

the Exercise Price.

 

Subject to Rule 7.4, the Notice of Exercise is only effective (and only becomes effective) when any cheque received in payment of the Exercise Price has been honoured on presentation or when any electronic funds transfer in payment of the Exercise Price has deposited cleared funds in the Company’s bank account.

 

7.4

Net settlement

 

On request from a Participant, the Board will apply a net settlement procedure as follows in respect of Options with an Exercise Price that is not nil:

 

 

(1)

the Participant will not be required to pay the Exercise Price for the Options which are exercised; and

 

 

(2)

the number of CDIs which must be issued to the Participant as a result of the Exercise is the number given by the following formula:

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Where:

 

N =          the number of CDIs to be issued resulting from the exercise, rounded up in the event of fractional entitlements;

 

n =         the total number of CDIs which would be issued as a result of the Exercise of the Options pursuant to Rule 7.3 if the Participant paid the Exercise Price for each Option pursuant to Rule 7.3(3)(b);

 

EP =          the aggregate of the Exercise Prices for all Options Exercised by the Participant pursuant to Rule 7.3, expressed in dollars and cents;

 

P =          the volume weighted average price (calculated to two decimal places) for the CDIs traded on the financial market conducted by the ASX (or such other financial market determined by the Board from time to time) during the 5 trading days prior to the date on which the Options are Exercised, expressed on a per share basis, in dollars and cents rounded down to the nearest whole cent.

 

7.5

Issue of CDIs

 

Subject to these Rules, within 10 Business Days after the Notice of Exercise referred to in Rule 7.3 becomes effective, the Company must:

 

 

(1)

transfer (or procure the transfer) or issue the number of CDIs specified in the Notice of Exercise to the Participant;

 

 

(2)

cancel the Certificate for the Options being exercised; and

 

 

(3)

if applicable, issue a new Certificate for any remaining Options covered by the Certificate accompanying the Notice of Exercise.

 

7.6

Exercise all or some Options

 

 

(1)

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

 

 

(2)

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

 

7.7

Quotation of CDIs

 

If other CDIs are officially quoted on the ASX at the time of issue of CDIs under this Plan, the Company must, within the time frame required by the Listing Rules, apply for Official Quotation of the CDIs.

 

7.8

CDIs rank equally

 

Subject to the restrictions imposed under Rule 10, all CDIs allotted on the exercise of Options granted under this Plan rank pari passu in all respects with CDIs previously issued and, in particular, entitle the holders to participate fully in:

 

 

(1)

dividends in respect of the underlying Shares with a record date on or after the date of allotment; and

 

 

(2)

all issues of securities made or offered pro rata to holders of CDIs.

 

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8

Lapse of Options

 

8.1

Lapse of vested Options

 

Unless otherwise specified in the Certificate or determined otherwise by the Plan Committee, an Option which has vested with the Participant lapses on the earlier of:

 

 

(1)

the Last Exercise Date;

 

 

(2)

a determination of the Plan Committee that the Option should lapse because the Participant, in the Plan Committee's opinion:

 

 

(a)

has been dismissed or removed from office for a reason which entitles a company in the Group to dismiss the Participant without notice;

 

 

(b)

has committed an act of fraud, defalcation or gross misconduct in relation to the affairs of that company (whether or not charged with an offence); or

 

 

(c)

has done an act which brings the Group or any company in the Group into disrepute; and

 

 

(3)

the date determined by the Plan Committee (which in no event will be more than six months) after the date of termination of employment of the Participant with the Group (other than due to the occurrence of a Special Circumstance).

 

8.2

Options cease

 

If a Participant fails for any reason to exercise all the Options registered in the Participant's name before the occurrence of a circumstance set out in Rule 8.1, those Options that the Participant:

 

 

(1)

would have been entitled to exercise and that have not been exercised; and

 

 

(2)

may have had a right or entitlement to have vested in the Participant,

 

lapse and all rights of a Participant under the Plan in respect of those Options cease.

 

9

Dealings with Options

 

9.1

Options personal

 

Except where an Option has been transferred under Rule 9.3, an Option held by a Participant is personal to the Participant and may not be exercised by another person.

 

9.2

No unauthorised disposal

 

Except as permitted under Rule 9.3, a Participant must not dispose of or grant a Security Interest over or otherwise deal with an Option or an interest in an Option, and the Security Interest or disposal or dealing is not recognised in any manner by the Company.

 

9.3

Disposal with prior written approval

 

The rights and entitlements of a Participant to Options may be transferred, assigned, encumbered or otherwise disposed of by the Participant:

 

 

(1)

by transmission on death of the Participant; or

 

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(2)

with the prior written agreement of the Board or the Chairman of the Board (which consent shall not be unreasonably delayed or withheld) and in accordance with Regulation S promulgated under the Securities Act.

 

10

Dealings with CDIs

 

10.1

Securities Trading Policy

 

The Participant must comply with the Securities Trading Policy at all times, including for CDIs issued under Rule 7.4.

 

10.2

Each certificate representing the CDIs issued under Rule 7.4 or underlying Shares (as applicable) will bear the following legend:

 

“The shares represented by this certificate have been issued in reliance on Regulation S promulgated under US Securities Act of 1933 (“Securities Act”) and may not be transferred except in accordance with Regulation S, pursuant to registration under the Securities Act or pursuant to an available exemption from registration”

 

11

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

 

11.1

New issues

 

Subject to the Listing Rules, a Participant is only entitled to participate (in respect of an Option granted under the Plan) in a new issue of CDIs to existing shareholders generally if the Participant has validly exercised his or her Options within the relevant Exercise Period and become a Shareholder prior to the relevant record date, and is then only entitled to participate in relation to CDIs of which the Participant is the registered holder.

 

11.2

Pro Rata Issues

 

If the Company makes a Pro Rata Issue, the Exercise Price of each Option will be reduced with the new exercise price of each Option to be calculated in accordance with the following formula:

 

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where:

 

NP = the new exercise price of the Option

 

OP = the old exercise price of the Option

 

E = the number of underlying securities into which one Option is exercisable

 

P = the average Market Price (as that term is defined in the Listing Rules) per CDI (weighted by volume) of the underlying securities during the 5 trading days ending on the day before the ex rights date or ex entitlements date

 

S = the subscription price for a security to be issued under the Pro Rata Issue

 

D = the amount of any dividend due but not yet paid on the existing underlying securities (except those securities to be issued under the Pro Rata Issue)

 

N = the number of existing securities with rights or entitlements that must be held to receive a right to one new security under the Pro Rata Issue

 

No change will be made to the number of CDIs to which You are entitled.

 

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11.3

Bonus Issues

 

Subject to the Listing Rules, if there is a Bonus Issue to the holders of CDIs, the number of CDIs over which an Option is exercisable will be increased by the number of CDIs which the holder of the Option would have received if the Option had been exercised before the record date for the Bonus Issue.

 

11.4

Reconstructions

 

In the event that, prior to the exercise of an Option, there is a reconstruction (including a consolidation, subdivision, reduction or return) of the issued capital of the Company, then the rights of the Participant including the number of Options that each Participant is entitled or the Exercise Price (if any), or both, will be reconstructed in the manner permitted by the Listing Rules.

 

11.5

Winding up

 

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

 

11.6

Fractions of CDIs

 

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

 

11.7

Calculations and adjustments

 

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

 

11.8

Notice of change

 

To the extent required by the Listing Rules, the Company must give notice to each Participant of any adjustment to the number of CDIs for which the Participant is entitled to subscribe or to the Exercise Price pursuant to the provisions of this Rule 11.

 

12

Administration of the Plan

 

12.1

Administration

 

The Plan is administered by the Plan Committee.

 

13

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12.2

Powers of the Plan Committee

 

The Plan Committee has power to:

 

 

(1)

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

 

 

(2)

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

 

 

(3)

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

 

 

(4)

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

 

 

(5)

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

 

 

(6)

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

 

 

(7)

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

 

12.3

Exercise of powers or discretion

 

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

 

12.4

Determinations

 

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

 

12.5

Expenses and costs

 

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

 

12.6

Tax

 

No company in the Group or any adviser to a company in the Group or the Board is liable for any Tax which may become payable by a Participant in the Plan and none of them represent or warrant that any person will gain any taxation advantage by participating in the Plan.

 

12.7

Deferred Taxation

 

Unless a Plan Offer expressly indicates otherwise, Subdivision 83A-C of the Income Tax Assessment Act 1997 (Cth) applies to any grants of Options under the Plan (subject to the requirements of that Act).

 

14

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13

Amendment to Rules

 

13.1

Amendment

 

Subject to Rules 13.2 and 13.3, the Company may at any time by written instrument or by resolution of the Board, amend all or any of the provisions of these Rules (including this Rule 13).

 

13.2

Accrued Rights

 

No amendment of the provisions of these Rules may reduce the accrued rights of any Participant in respect of Options or CDIs issued under the Plan prior to the date of the amendment, other than:

 

 

(1)

an amendment introduced primarily:

 

 

(a)

for the purpose of complying with or conforming to present or future State, Territory or Commonwealth legal requirements governing or regulating the maintenance or operation of the Plan or like plans;

 

 

(b)

to correct any manifest error or mistake;

 

 

(c)

to enable contributions or other amounts paid by the Company in respect of the Plan to qualify as income tax deductions;

 

 

(d)

to enable the Participant or the Company to reduce the amount of fringe benefits tax under the Fringe Benefits Tax Assessment Act 1986, the amount of tax under the Tax Act or the amount of any other tax or impost that may otherwise be payable by the Participant or the Company in relation to the Plan;

 

 

(e)

for the purpose of enabling Participants generally (but not necessarily each Participant) to receive a more favourable taxation treatment in respect of their participation in the Plan; or

 

 

(f)

to enable the Company to comply with the Corporations Act, the Listing Rules or any other legal requirement; or

 

 

(2)

with the consent of Participants who between them hold not less than 75% of the total number of those Options or CDIs held by all those Participants before making the amendment.

 

13.3

Listing Rules

 

No amendment may be made except in accordance with and in the manner stipulated (if any) by the Listing Rules.

 

13.4

Retrospectivity

 

Subject to the above provisions of this Rule 13, any amendment made under Rule 13.1 may be given such retrospective effect as is specified in the resolution by which the amendment is made and, if so stated, amendments to these Rules, including the terms applicable to Options and CDIs issued under this Plan, have the effect of automatically amending the terms of Options and CDIs issued and still subject to these Rules.

 

15

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14

Financial assistance

 

14.1

Subject to the requirements of any Applicable Law, the Company may provide financial assistance to You in connection with the issue or exercise of an Option under the Plan.

 

15

Rights of Participants

 

15.1

No conferred rights

 

These Rules:

 

 

(1)

do not confer on You the right to receive any Options;

 

 

(2)

do not confer on You the right to continue as an Employee;

 

 

(3)

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

 

 

(4)

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

 

15.2

Voting at general meetings

 

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

 

16

Notices

 

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

 

17

Severance

 

If any of these Rules are void, voidable or unenforceable, that provision will be severed and the remainder of these Rules will have full force and effect.

 

18

Governing law & jurisdiction

 

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

 

19

Advice

 

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

 

16

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20

Data protection

 

20.1

Collection and purpose

 

The Company needs to collect personal information about You for the Purpose. If this personal information is not provided to the Company, the Company may not be able to achieve the Purpose.

 

20.2

Consent

 

By completing and returning the Application, You authorise and instruct each company in the Group and any agent of any company in the Group:

 

 

(1)

to collect, disclose and transfer between each other (including those located outside Australia) any personal information as the Company may request;

 

 

(2)

to disclose any personal information to the Australian Taxation Office, ASX, ASIC or any governmental agency or authority as may be required in connection with the administration of the Plan;

 

 

(3)

to store and process personal information,

 

in accordance with the Purpose. You may withdraw this authorisation.

 

20.3

Access to personal information

 

You may access any personal information held by the Company by contacting the Company Secretary and may require any personal information to be corrected if that personal information is inaccurate or incomplete.

 

17
 

Exhibit 10.2

 

Universal Biosensors Inc.

 

Employee Incentive Plan

 

Plan Rules

 

 

1.

Introduction

 

This Plan sets outs the rules under which Eligible Persons may, at the invitation of the Company, acquire Awards to acquire CDIs in the Company.

 

2.

Definitions and Interpretation

 

2.1

In these rules, unless the contrary intention appears, the following terms have the following meanings:

 

ASX means ASX Limited ABN 98 008 624 691 or a market conducted by it (as the context requires);

 

Award means:

 

 

(a)

an Option;

 

 

(b)

a Performance Right;

 

 

(c)

CDI; or

 

 

(d)

a Restricted CDI,

 

(as applicable), or such other instrument that the Board determines, granted under these Rules in the absolute discretion of the Board and as specified in an offer;

 

Board means the board of directors of the Company or any relevant committee of that board (as applicable);

 

Bonus Issue means a Pro Rata Issue of CDIs to holders of CDIs for which no consideration is payable by them;

 

Business Day means any day except Saturday or Sunday or other public holiday in the State of Victoria, Australia;

 

CDI means a chess depositary interest, representing a Share;

 

Company means Universal Biosensors Inc.;

 

Eligible Person means any person considered by the Board to be employed by the Company or any other entity in the Group on a permanent basis (whether full time, part time or on a long term casual basis) and includes all executive and non-executive directors of the Company or any other person determined by the Board to be an employee for the purposes of this Plan; provided that such person is not a resident of the United States (other than employees on temporary assignment in the United States);

 

page 1

 

Exchange Act means the Securities Exchange Act 1934 as amended from time to time;

 

Exemption Conditions means the conditions set out in section 83A-35 of the Tax Act, as amended from time to time;

 

Exercise Price means the amount payable to exercise an Award following vesting as set out in an invitation (as adjusted or amended in accordance with these Rules);

 

Group means the group of related or associated companies of which the Company is the holding company and includes any entity designated by the Board to be a member of the Group (even though not a subsidiary of the Company);

 

Holding Lock means a mechanism arranged or approved by the Remuneration Committee and administered by the Company that prevents CDIs being transferred or otherwise disposed of by a Participant during the Restriction Period so as to ensure the Exemption Conditions are satisfied.

 

Liquidity Event means:

 

 

(a)

the date on which an agreement for the sale of the share capital of the Company is entered into or the acquisition by one of the shareholders of fifty percent (50%) or greater of the remaining Shares, other than in the context of a solvent reconstruction where underlying beneficial ownership remains substantially unchanged;

 

(b)

the date on which an agreement for the disposal by whatever means (including without limitation by sale, transfer, licence, declaration of trust or otherwise) of the whole or substantially the whole of the property, business or undertaking of the Company is entered into; or

reorganisation, merger or consolidation of the Company with another entity in which the Company will not survive.

 

Listed means that the Company is admitted to the official list of, or otherwise quoted on, a securities exchange;

 

Listing Rules means the Listing Rules of the ASX, as amended from time to time;

 

Option means an option to subscribe for an Award in the Company and granted under this Plan;

 

Participant means an Eligible Person who accepts an offer and holds an Award issued pursuant to this Plan and includes, if a Participant dies or becomes subject to a legal disability, the legal personal representative of the Participant.

 

Performance Right means an Award specified by the relevant notice of grant to be a 'Performance Right';

 

Plan means this Employee Incentive Plan;

 

Pro Rata Issue has the meaning given in the Listing Rules;

 

page 2

 

[Remuneration Committee means the remuneration committee of the Company];

 

Restricted CDIs has the meaning given to that term in clause 14;

 

Rules means the rules of this Plan;

 

Securities Act means the Securities Act of 1933 as amended from time to time;

 

Security Interest means a mortgage, charge, pledge, lien, encumbrance or other third party interest;

 

Securities Trading Policy means the Company's trading policy with respect to CDIs as amended from time to time;

 

Share means a fully paid share of common stock in the capital of the Company;

 

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

 

Tax Act means the Income Tax Assessment Act 1997 (Cth) as amended.

 

2.2

In these Rules, except where the context otherwise requires:

 

 

(a)

the singular includes the plural and vice versa;

 

 

(b)

a reference to the whole or part of any legislation includes any amendment, consolidation or re-enactment of the legislation or any legislative provision substituted for the legislation and references to specific provisions includes references to successor provisions in any substituted legislation; and

 

 

(c)

headings are inserted for convenience only and do not affect construction or interpretation of these Rules.

 


3.

Commencement of the Plan

 

This Plan takes effect on and from the date determined by the Board.

 


4.

Rules

 

The Plan shall operate in accordance with these Rules which bind the Company and each other company in the Group, and each Eligible Person and/or Participant.

 

page 3

 

5.

Compliance

 

5.1

No offer may be made to an Eligible Person and no Awards may be issued or transferred under the Plan if to do so would contravene any applicable laws, regulations, the Listing Rules or these Rules.

 

5.2

If and to the extent applicable at any time, the issue of Awards under this Plan or to a particular Eligible Persons is subject to receipt of any necessary shareholder or other approvals under:

 

 

(a)

the Securities Act or any other law applicable to the Company; and

 

 

(b)

if the Company is Listed, the applicable Listing Rules.

 

5.3

The Plan (in respect of both its terms and operation) and Awards issued to or acquired by Eligible Employees under the Plan shall satisfy the Exemption Conditions so as to permit the application of sub-sections 83A-35(1) and (2) of the Tax Act to Participants (or applicable successor provisions).

 


6.

Maximum Number of Awards

 

6.1

The maximum number of Awards that may be granted to Participants under this Plan from time to time is limited to such number as:

 

 

(a)

is consistent with the by-laws, certificate of incorporation or other constituent documentation of the Company (as applicable);

 

 

(b)

is consistent with any regulatory constraints under the Securities Act or any other law, rule or regulation applicable to the Company, including any instruments of relief issued by ASIC from time to time relating to employee incentive schemes which the Company is relying on;

 

 

(c)

if the Company is Listed, is consistent with any applicable Listing Rules; and

 

 

(d)

is determined by the Board from time to time having regard to the limitation set out in subclauses (a) to (c) inclusive.

 


7.

Eligibility

 

7.1

Unless the Remuneration Committee determines otherwise, Awards may be issued or transferred to a Participant under this Plan only if at both:

 

 

(a)

the date of the offer; and

 

 

(b)

the date that the Awards are intended to be issued or transferred to the Eligible Person or Participant for the purposes of the offer,

 

the person is an Eligible Person and that person satisfies such other criteria the Board may from time to time decide for participation in the Plan.

 

7.2

Subject to complying with section 83A-35 of the Tax Act , the Company reserves the right to refuse participation in the Plan in whole or in part for any particular individual or group of individuals, even if eligibility criteria has been satisfied for participation.

 

page 4

 


8.

Invitation

 

8.1

Subject to these Rules and the Tax Act, the Remuneration Committee may from time to time issue offers on behalf of the Company to such Eligible Employees and existing Participants as are determined by the Remuneration Committee to participate in the Plan.

 

8.2

Awards must be granted on the terms of this Plan and any other terms specified in the notice of grant pursuant to which the Awards are offered to each Eligible Person.

 

8.3

Subject to complying with Section 83A-35 of the Tax Act, each offer:

 

 

(a)

will be made in the manner and form determined by the Remuneration Committee from time to time;

 

 

(b)

will specify such matters as the Remuneration Committee determines are applicable, including without limitation:

 

 

(1)

the specified number or value of Awards being offered; and

 

 

(2)

any conditions or restrictions that the Remuneration Committee may determine attached to the offer; and

 

 

(c)

where the Award offer is for a grant of an Option or Performance Right, must include the following information:

 

 

(1)

if the Award is an Option, the requirements for exercising the Option, including any Exercise Price that will be payable and the period or periods in which the Option may be exercised;

 

 

(2)

the dates or circumstances in which Option or Performance Right may lapse; and

 

 

(3)

any other conditions which must be satisfied before the Awards vest in the Participant or are otherwise exercisable by the Participant.

 

8.4

An offer under the Plan is personal to the Eligible Person or Participant (as the case may be) to whom it is made and, accordingly, the offer may only be accepted by, and Awards may be provided only to, the Eligible Person or Participant to whom the offer is made.

 


9.

Acceptance

 

9.1

The method and form of acceptance of an offer will be determined by the Remuneration Committee from time to time.

 

9.2

On acceptance of an offer in accordance with the requirements determined under clause 9.1, the Eligible Person or existing Participant (as the case may be) will be taken to have:

 

 

(a)

be bound by the constituent documents of the Company, including the Company’s by-laws and certificate of incorporation and (upon an issue of CDIs) become a member of the Company;

 

 

(b)

agreed to become a Participant and be bound by these Rules; and

 

page 5

 

 

(c)

irrevocably subscribe for Awards under the Plan in accordance with the terms of the offer and the acceptance form accompanying the offer.

 


10.

Acceptance of Awards

 

10.1

The acceptance form of an Eligible Person or existing Participant, is subject to acceptance by the Remuneration Committee in accordance with clause 10.4.

 

10.2

Upon acceptance by the Remuneration Committee of a duly completed and signed acceptance form, the Company must, in accordance with the terms of the offer, issue to the Eligible Person or Participant, or arrange the transfer to the Eligible Person or Participant of, the number of Awards that the Eligible Person or Participant validly offers to acquire.

 

10.3

The number of Awards to be registered in any Participant's name will be the number set out in the offer and as accepted by an Eligible Person or Participant in an acceptance form.

 

10.4

Unless provided for otherwise in an offer, the Remuneration Committee will be deemed to have accepted an Eligible Person's or Participant's acceptance form when it has registered the relevant Awards in the name of the Eligible Person or Participant. Nothing in any offer or acceptance form, or in these Rules, will be taken to confer on any Eligible Person or Participant any right or title to or interest in, any Awards until the Awards are so issued, allotted and registered.

 

10.5

The Company will give notice, or cause notice to be given, to a Participant (or any person authorised to receive such notice on the Participant's behalf), in accordance with the Listing Rules, of the registration in the Participant's name of Awards acquired for the Participant under the Plan.

 


11.

Acquisition of an Award

 

11.1

Awards may be acquired for registration in the name of a Participant:

 

 

(a)

by way of an allotment and issue of CDIs by the Company;

 

 

(b)

by the Company purchasing CDIs in the ordinary course of trading or otherwise on the ASX; or

 

 

(c)

by the Company purchasing CDIs by off-market purchases.

 

11.2

The Company may:

 

 

(a)

issue or transfer Awards to Participants for no consideration; or

 

 

(b)

require the Eligible Person to pay application money for or on account of Awards to be acquired under the Plan.

 

11.3

The Company is authorised, but not required, to bear all brokerage, commission, stamp duty or other transaction costs and expenses payable in connection with the acquisition of Awards under the Plan.

 

page 6

 


12.

Rights attaching to CDIs

 

12.1

CDIs allotted or transferred under the Plan shall:

 

 

(a)

be fully paid;

 

 

(b)

rank equally with all other existing CDIs on issue; and

 

 

(c)

be subject to any restrictions of conditions as determined by the Remuneration Committee or otherwise by this Plan.

 

12.2

A Participant:

 

 

(a)

is entitled to receive any dividend paid on CDIs registered in the Participant's name;

 

 

(b)

may exercise any voting rights attaching to those CDIs, or may appoint a proxy to represent and vote for him or her, at any meeting of the members of the Company; and

 

 

(c)

subject to clause 19.9, participate in all rights issues, bonus share issues in respect of those CDIs,

 

which have a record date for determining entitlements on or after the date of issue or registration of those CDIs.

 


13.

Quotation of Awards and CDIs

 

13.1

Awards may not be quoted on any securities exchange on which the Company is Listed.

 

13.2

The Company shall apply to ASX for official quotation of any new Awards (excluding any Restricted CDIs) issued under or for the purposes of the Plan in accordance with the Listing Rules.

 


14.

Restrictions on CDIs

 

14.1

A Participant must not transfer, sell or otherwise dispose of, or grant (or purport to grant) any Security Interest in or over or otherwise dispose of or deal with (or purport to otherwise dispose of or deal with) any CDIs acquired under the Plan while they are Restricted CDIs. The Company may refuse to acknowledge, deal with, accept or register any disposal or purported disposal, of any or all of the Restricted CDIs.

 

14.2

CDIs granted under this plan (other than as a result of the vesting of a Performance Right) will be considered Restricted CDIs from the date the CDIs are registered in the name of the Participant until the earlier of:

 

 

(a)

the date three years after the relevant date the CDIs are registered in the name of the Participant or such other date as may be determined by the Remuneration Committee in its discretion so as to satisfy the Exemption Conditions; or

 

 

(b)

the day after the date on which the Participant ceases or first ceases to be employed by a body corporate in the Group.

 

14.3

A Holding Lock may be applied by the Company to Restricted CDIs and maintained for the duration of the period that those CDIs are Restricted CDIs. A Participant must not request the removal of the Holding Lock (or permit or authorise another person to do so).

 

page 7

 

14.4

The Company shall be entitled to prescribe, take and enforce such action, steps or arrangements as it considers necessary, desirable or appropriate to enforce or give further effect to the provisions of this clause 14 in order to ensure that the Exemption Conditions and these Rules are satisfied.

 

14.5

After the CDIs cease to be Restricted CDIs:

 

 

(a)

a Participant shall be entitled to submit a request to the Company for the CDIs to be released from the Plan; and

 

 

(b)

the Remuneration Committee shall be entitled at any time to release the CDIs from the Plan notwithstanding that the Participant may not have requested that the CDIs be released.

 


15.

Vesting and lapsing of Performance Rights and Options

 

15.1

Subject to any express clause of these Rules, any Award (including Performance Right or an Option) will only vest (and, in the case of an Option, become exercisable) where each vesting conditions and any additional terms specified in the invitation letter for that Award (including Performance Right or Option) have been satisfied or otherwise waived by the Board.

 

15.2

Vesting occurs upon notification from the Company to the Participant that an Award (including Performance Right or an Option) has vested pursuant to this clause 15.

 

15.3

On the vesting of a Performance Right in accordance with clause 15.2, or (subject to clause 15.4) exercise of an Option in accordance with clause 16, the Company must allocate a CDI to the Participant:

 

 

(a)

by way of an allotment and issue of CDIs by the Company;

 

 

(b)

by the Company purchasing CDIs in the ordinary course of trading or otherwise on the ASX; or

 

 

(c)

by the Company purchasing CDIs by off-market purchases.

 

15.4

The Company is not obliged to issue CDIs unless it has received cleared funds on account of the Exercise Price of Options.

 

15.5

A Performance Right or Option will lapse on the earliest to occur of:

 

 

(a)

a date or circumstance specified in the invitation for that Performance Right or Option or a provision of these Rules as to when a Performance Right or Option lapses or expires;

 

 

(b)

failure to meet a vesting condition within the relevant vesting period specified in the invitation for that Award, or failure to meet any other condition applicable to that Award within the period specified in the invitation for that Award; or

 

 

(c)

the receipt by the Company of a notice in writing from a Participant that the Participant has elected to surrender the Award.

 

page 8

 

15.6

Without limiting clause 15.5 , if a Participant ceases to be an Eligible Person (other than through the death or permanent disability of the Participant):

 

 

(a)

all Awards granted to a Participant which have not vested automatically lapse; and

 

 

(b)

all Awards granted to the Participant which have vested lapse on the expiry of 90 days (or such longer period as determined by the Board) after the date on which the Participant ceases to be an employee, unless the employee ceases to be an employee as a result of termination for dishonesty, fraud or cause (as defined under applicable law) in which case the Awards lapse immediately on ceasing to be an Eligible Person.

 

15.7

On the death or permanent disability of a Participant:

 

 

(a)

all Awards granted to a Participant which have not vested automatically lapse; and

 

 

(b)

notwithstanding anything to the contrary in these Rules, the Awards which have already vested in the Participant prior to death or permanent disability, lapse on the expiry of 12 months after the date of the Participant's death or disability (except to the extent that the executor or beneficiaries of that Participant's estate exercise any or all of those Awards).

 


16.

Exercise of Options

 

16.1

Where the Award is an Option and is subject to vesting conditions, it may only be exercised if it has vested and before it expires.

 

16.2

When exercised, each Option held by a Participant entitles the Participant to subscribe for and to be issued one CDI (representing one fully paid underlying Share)). The subscription price for the CDI is equal to and satisfied by payment of the Exercise Price of the Option.

 

16.3

No Option may be exercised if the issuance of CDIs upon exercise or the method of payment of consideration for such CDIs would constitute a violation of any applicable securities or other law or regulation. Unless the CDIs or underlying Shares are registered under the Securities Act and any applicable state securities law, as a condition to exercising an Option, the Participant shall provide the Company with such written assurances as the Company deems appropriate for the Option grant and exercise to qualify for exemption from registration. The assurances shall include a representation that such Participant is not a resident of the United States and may include, among others, a representation that the Participant intends to hold the CDIs for investment and not for distribution to the public. The Company has no obligation to register the Options or CDIs under the Securities Act or any other law or to otherwise take any actions or incur any expenses to comply with an applicable securities or other law or regulation.

 

16.4

A Participant may exercise Options by lodging with the Company a notice of exercise in a form approved or accepted by the Board accompanied by payment of the aggregate Exercise Price for the Options the subject of the notice.

 


17.

Transfer

 

17.1

A Participant may not sell, assign, transfer, grant a Security Interest over or otherwise deal with a Award that has been granted to them, unless the relevant dealing is effected by force of law on death or legal incapacity to the Participant’s legal personal representative. The Company may require that an Award be forfeited if a sale, assignment, transfer, dealing or grant of a Security Interest occurs or is purported to occur other than in accordance with these Rules.Each certificate representing the CDIs or Shares (as applicable) will bear the following legend:

 

“The shares represented by this certificate have been issued in reliance on Regulation S promulgated under US Securities Act of 1933 (“Securities Act”) and may not be transferred except in accordance with Regulation S, pursuant to registration under the Securities Act or pursuant to an available exemption from registration”

 

page 9

 


18.

Takeovers or Liquidity Events

 

18.1

Notwithstanding anything to the contrary in these Rules, if a takeover bid is made or other formal scheme is proposed for the acquisition of some or all of the shares in the capital of the Company, a Participant may, if:

 

 

(a)

acceptance of the bid or scheme is recommended by the Directors; and

 

 

(b)

the Directors resolve to end the restriction on sale of the Awards under the Plan for the purpose of transfer to the bidder,

 

accept on such terms the Participant decides in respect of some or all of the Awards registered in his or her name.

 

18.2

On the occurrence of a Liquidity Event:

 

 

(a)

all Awards which have not yet vested, immediately vest and all Options become exercisable ten Business Days preceding the Liquidity Event.

 

 

(b)

the Company shall give each holder of an outstanding Award (including exercisable Option or vested Performance Rights) written notice of any Liquidity Event as soon as reasonably practicable except:

 

 

(1)

in those cases where the Options will continue to be exercisable, or Performance Rights will remain outstanding, for securities in the same amount (subject to adjustment to any Exercise Price) and of the same class as the securities into which the outstanding common stock of the Company will be converted as a result of the Liquidity Event; or

 

 

(2)

in respect of Options, in those cases where the fair market value of the consideration distributable with respect to each CDI is likely to be less than the Exercise Price of the Option;

 

 

(c)

the Company may cancel any outstanding exercisable Option that is not exercised within five Business Days before a Liquidity Event, without prior notice, by paying the Participant an amount equal to the fair market value of the consideration that the Participant would receive in exchange for the CDIs underlying the Option, less the Exercise Price of the Option.

 

 

(d)

all unexercised Options shall terminate upon the closing of a Liquidity Event unless the successor entity assumes the Options or substitutes options to purchase substantially equivalent securities of the successor or its parent or subsidiary.

 

page 10

 


19.

Variations of Capital

 

19.1

Prior to the allocation of CDIs upon the exercise of an Award (Options or the vesting of Performance Rights or other), the Board may, in its discretion, determine in respect of Awards (other than Restricted CDIs) to:

 

 

(a)

make adjustments to the terms of an Award granted to that Participant; or

 

 

(b)

grant additional Awards to that Participant,

 

in order to minimise or eliminate any material advantage or disadvantage to a Participant resulting from a corporate action by the Company or a capital reconstruction of the Company, including a return of capital.

 

19.2

The applicable adjustment under clause 19.1 may be to one or more of the following:

 

 

(a)

the number of Awards (other than Restricted CDIs) to which each Participant is entitled;

 

 

(b)

the number of CDIs to which each Participant is entitled upon exercise of an Award (including Options or vesting of Performance Rights or other);

 

19.3

In the event that, prior to the exercise of an Award, there is a reconstruction (including a consolidation, subdivision, reduction or return) of the issued capital of the Company, then the rights of the Participant including the number of Award that each Participant is entitled or the Exercise Price (if any), or both, will be reconstructed in the manner permitted by the Listing Rules.

 

19.4

If the Company makes a Pro Rata Issue, the Exercise Price of each Award will be reduced with the new exercise price of each Award to be calculated in accordance with the following formula:

a1.jpg

where:

 

NP = the new exercise price of the Award

 

OP = the old exercise price of the Award

 

E = the number of underlying securities into which one Award is exercisable

 

P = the average Market Price (as that term is defined in the Listing Rules) per CDI (weighted by volume) of the underlying securities during the 5 trading days ending on the day before the ex rights date or ex entitlements date

 

S = the subscription price for a security to be issued under the Pro Rata Issue

 

D = the amount of any dividend due but not yet paid on the existing underlying securities (except those securities to be issued under the Pro Rata Issue)

 

N = the number of existing securities with rights or entitlements that must be held to receive a right to one new security under the Pro Rata Issue

 

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No change will be made to the number of CDIs to which the Participant is entitled.

 

19.5

Subject to the Listing Rules, if there is a Bonus Issue to the holders of CDIs, the number of CDIs over which an Award is exercisable will be increased by the number of CDIs which the holder of the Award would have received if the Award had been exercised before the record date for the Bonus Issue.

 

19.6

The terms of this clause 19 relating to reconstructions, stock dividends and returns of capital may be applied on more than one occasion such that their effects may be cumulative. It is intended that the adjustments they progressively effect will be such as to reflect in relation to the CDIs subject to Awards, the adjustments which on the occasions in question are progressively effected in relation to CDIs already on issue.

 

19.7

If (whether before or during the expiry date for an Award) a resolution for a members' voluntary winding up of the Company is proposed (other than for the purpose of a reconstruction or amalgamation) the Board may, in its absolute discretion, give written notice to Participants of the proposed resolution. Subject to any exercise conditions, a Participant may, during the period referred to in the notice, exercise any Award if the Award has not expired.

 

19.8

Whenever the number of CDIs subject to Award or the Exercise Price is adjusted in accordance with these rules, the Company will give notice of the adjustment to the Participant holding the Award.

 

19.9

Subject to this clause 19, during the currency of any Award and prior to their exercise, the holders of any Award are not entitled to participate in any new issue of CDIs of the Company as a result of their holding of the Award.

 


20.

Plan Amendments

 

20.1

The rights attaching to any Award may be amended by the Board subject to receipt of any necessary shareholder or other approval under:

 

 

(a)

the Securities Act or any other law applicable to the Company; and

 

 

(b)

if the Company is Listed, the applicable Listing Rules.

 

20.2

If the Company is Listed and the provisions of this Plan or the terms of issue of the Award are inconsistent with the Listing Rules, then the Listing Rules prevail to the extent of any inconsistency and the terms of the Award will be deemed modified accordingly without further action by the Company, the Board or the holder of the Award being necessary.

 

20.3

Without limiting the generality of clause 20.2, it is a term of each Award that, if the Company is Listed, the rights of the Participant who holds the Award are deemed modified from time to time as necessary to ensure the terms of the Award comply with the Listing Rules generally and in particular (but without limitation) as those rules apply to reorganisations of capital at the time of any re-organisation of the Company's capital, in each case despite any inconsistent provision in the terms of this Plan.

 

20.4

Subject to clause 20.1 to 20.3 (inclusive) and, if the Company is Listed, to receipt of any necessary approvals under the Listing Rules, the terms of this Plan may be amended by the Board but without prejudice to the existing or accrued rights of Participants before any amendments are made.

 

page 12

 

20.5

If the Company becomes subject to section 16 of the Exchange Act, this Plan shall be administered in accordance with rule 16b-3 promulgated under the Exchange Act, or any successor rule. Unless the Board determines otherwise in a specific case, [Awards / Shares] granted to persons subject to section 16(b) of the Exchange Act must comply with rule 16b-3 of the Exchange Act and shall contain such additional conditions or restrictions as may be required there under to qualify for the maximum exemption from section 16 with respect to Plan transactions. In addition to the extent necessary and desirable to comply with rule 16b-3 of the Exchange Act or with section 422 of the Internal Revenue Code (or any other applicable law or regulation, including the requirements of an established stock exchange), the Company shall obtain shareholder approval of any Plan amendment in such a manner and to such a degree as required.

 


21.

Administration of the Plan

 

21.1

This Plan will be administered by the Remuneration Committee. The Remuneration Committee will have power to:

 

 

(a)

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

 

 

(b)

delegate to any persons for such period and on such terms as it sees fit, the exercise of any of its powers or discretions under this Plan;

 

 

(c)

determine appropriate procedures for administration of this Plan consistent with these Rules, including approving the form and content of forms and notices to be issued under this Plan;

 

 

(d)

resolve conclusively all questions of fact, construction, interpretation or ambiguity in connection with the terms or operation of this Plan and the terms of Awards or CDIs acquired under this Plan;

 

 

(e)

subject to the Listing Rules, amend, add to or waive any condition under the Plan or any restriction or other condition relating to any Awards allotted under the Plan;

 

 

(f)

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

 

 

(g)

make regulations for the operation of the Plan which are not inconsistent with these Rules.

 

21.2

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

 

21.3

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

 

page 13

 


22.

Amendments

 

22.1

Subject to complying with Section 83A-35 of the Tax Act, the Board may at any time amend any of these Rules, or waive or modify the application of any of these Rules in relation to any Eligible Employee or Participant.

 

22.2

The Board must not make an amendment under clause 22.1 which would adversely affect the rights of Participants who have been issued Awards under the Plan without first obtaining the consent of Participants who collectively hold 75% of the Awards affected by the amendment and any other approvals required under Applicable Laws.

 

22.3

The Board may adopt additions, variations or modifications to the Rules applicable in any jurisdiction outside Australia under which Awards allocated under the Plan may be subject to additional or modified terms, having regard to any securities, exchange control or taxation laws or regulations or similar factors which may apply to the Participant or to the employer of the Participant in relation to the Awards. Any additional rule must conform to the basic principles of the Plan.

 


23.

Dealings with CDIs

 

23.1

The Participant must comply with the Securities Trading Policy at all time, including in respect of Awards and CDIs issued under this Plan.

 


24.

Duties and Taxes

 

24.1

The Company:

 

 

(a)

is not responsible for any duties or taxes which are or may become payable on the transfer, allotment or issue of Awards under the Plan or any other dealing with the Awards; and

 

 

(b)

may make any withholding or payment which it is required by law to make in connection with the Plan or the CDIs or Awards.

 

24.2

Unless a Plan Offer expressly indicates otherwise, Subdivision 83A-C of the Income Tax Assessment Act 1997 (Cth) applies to any grants of Awards under the Plan (subject to the requirements of that Act).

 


25.

Rights of Participants

 

25.1

The rights and obligations of a Participant under the terms of his or her employment by a company in the Group are not affected by his or her participation in the Plan. The Rules:

 

 

(a)

do not confer on any Employee the right to be offered any Award ;

 

 

(b)

do not confer on any Participant the right to continue as an Employee;

 

 

(c)

do not affect any rights which the Company or its Subsidiaries may have to terminate the employment of any Eligible Employee or Participant; and

 

page 14

 

 

(d)

may not be used to increase damages in any action brought against the Company or its Subsidiaries in respect of that termination.

 

25.2

These Rules do not form part of, and will not be incorporated into, any contract of engagement or employment between a Participant and his or her employer.

 

25.3

No Participant has any right to compensation or damages as a result of the termination of his or her employment by a company in the Group for any reason, so far as those rights arise or may arise from the Participant ceasing to have rights under the Plan as a result of the termination.

 


26.

Notices

 

26.1

Service of all documents required by this Plan shall be deemed to be affected if the Company sends the document by post to the last address or facsimile number of the Participant known to the Company.

 

26.2

A communication sent by post is deemed to be received on the third Business Day after posting. A communication sent by facsimile is deemed to be received at the time shown on the sender’s transmission report, if it shows that the transmission was successful.

 


27.

Termination of the Plan

 

This Plan may be terminated at any time by resolution of the Board. Termination of this Plan will be without prejudice to the rights of Participants in respect of CDIs or Awards outstanding at the date of termination.

 


28.

Governing Law

 

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

 


29.

Advice

 

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

 


30.

Data protection

 

30.1

The Company needs to collect personal information about Participants for the purpose of facilitating the operation and administration of the Plan (Purpose). If this personal information is not provided to the Company, the Company may not be able to achieve the purpose.

 

30.2

By completing and returning an application to participate in the Plan, a Participant authorises and instructs each company in the Group and any agent of any company in the Group:

 

 

(a)

to collect, disclose and transfer between each other (including those located outside Australia) any personal information as the Company may request;

 

page 15

 

 

(b)

to disclose any personal information to the Australian Taxation Office, ASX, ASIC or any governmental agency or authority as may be required in connection with the administration of the Plan;

 

 

(c)

to store and process personal information,

 

in accordance with the Purpose. Participants may withdraw this authorisation.

 

30.3

Participants may access any personal information held by the Company by contacting the Company Secretary and may require any personal information to be corrected if that personal information is inaccurate or incomplete.

 

page 16

 

 

 
 

Universal Biosensors Inc.

Employee Incentive Plan

Plan Rules

 
 

 

 


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