UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 5, 2025
Kestra Medical Technologies, Ltd.
(Exact name of registrant as specified in its charter)
Bermuda | 001-42549 | Not Applicable | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
3933 Lake Washington Blvd NE, Suite 200
Kirkland, Washington 98033
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (425) 279-8002
Not applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e- 4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
||
Common Share, par value $1.00 per share | KMTS | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement.
In connection with the initial public offering (the “Offering”) by Kestra Medical Technologies, Ltd. (the “Company”) of its common shares, par value $1.00 per share (the “Common Shares”), described in the prospectus (the “Prospectus”), dated March 5, 2025, filed with the Securities and Exchange Commission (“SEC”) pursuant to Rule 424(b) of the Securities Act of 1933, as amended (the “Securities Act”), which is deemed to be part of the Registration Statement on Form S-1 (File No. 333-284807) (as amended, the “Registration Statement”), the following agreements were entered into:
• | Warrant to Purchase 62,325 Common Shares issued to Kennedy Lewis Capital Partners Master Fund II LP, dated March 7, 2025, by and among the Company, West Affum Holdings, L.P. and Kennedy Lewis Capital Partners Master Fund II LP (the “KLIM Warrant Tranche A”); |
• | Warrant to Purchase 46,744 Common Shares issued to Kennedy Lewis Capital Partners Master Fund II LP, dated March 7, 2025, by and among the Company, West Affum Holdings, L.P. and Kennedy Lewis Capital Partners Master Fund II LP (the “KLIM Warrant Tranche B”); and |
• | Warrant to Purchase 325,847 Common Shares issued to Perceptive Credit Holdings IV, LP, dated March 7, 2025, by and among the Company, West Affum Holdings, L.P. and Perceptive Credit Holdings IV, LP (the “Perceptive Warrant”); |
The KLIM Warrant Tranche A, the KLIM Warrant Tranche B and the Perceptive Warrant are filed herewith as Exhibits 10.1, 10.2 and 10.3, respectively, and are incorporated herein by reference. The terms of these agreements are substantially the same as the terms set forth in the forms of such agreements previously filed as exhibits to the Registration Statement and as described therein.
Item 3.03 Material Modification to Rights of Security Holders.
The information set forth under Item 5.03 below is incorporated by reference in this Item 3.03.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
2025 Omnibus Incentive Plan
Effective on March 5, 2025, the Company’s Board of Directors and its sole shareholder as of February 25, 2025 adopted and approved the Kestra Medical Technologies, Ltd. 2025 Omnibus Incentive Plan (the “2025 Plan”) substantially in the form previously filed as Exhibit 10.2 to the Registration Statement. The 2025 Plan provides for the grant of share options, share appreciation rights, restricted shares, restricted share units, bonus shares, dividend equivalents, other share-based awards, substitute awards, annual incentive awards and performance awards to employees, executive officers, consultants and directors of the Company and its affiliates. For further information regarding the 2025 Plan, see “Executive Compensation—Compensation Programs Following This Offering—Summary of the 2025 Omnibus Incentive Plan” in the Prospectus.
A copy of the 2025 Plan is filed herewith as Exhibit 10.4 and incorporated herein by reference. The above description of the 2025 Plan is not complete and is qualified in its entirety by reference to such exhibit.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On March 7, 2025, the Company’s Amended and Restated bye-laws (the “bye-laws”), in the form previously filed as Exhibit 3.3 to the Registration Statement, became effective. The bye-laws are filed herewith as Exhibit 3.1 and are incorporated herein by reference.
As previously disclosed in the Registration Statement, in connection with the Offering, the Company’s Board of Directors and its sole shareholder approved, among other things, an increase to the Company’s authorized share capital to US$100,000,000 divided into 100,000,000 common shares of par value of US$1.00 each and a redesignation of the Company’s authorized and issued ordinary shares as common shares. Such increase of the Company’s authorized share capital was registered with the Registrar of Companies of Bermuda and subsequently recorded in a Certificate of Deposit of Memorandum of Increase of Share Capital issued by the Registrar of Companies of Bermuda filed herewith as Exhibit 3.2, which is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: March 7, 2025 | Kestra Medical Technologies, Ltd. | |||||
By: | /s/ Brian Webster |
|||||
Name: | Brian Webster | |||||
Title: | President, Chief Executive Officer and Director |
Exhibit 3.1
AMENDED AND RESTATED BYE-LAWS
of
Kestra Medical Technologies, Ltd.
Maples Corporate Services (Bermuda) Limited hereby certifies that the attached Amended and Restated Bye-Laws are a true copy of the Amended and Restated Bye-Laws of Kestra Medical Technologies, Ltd. (the “Company”), as approved and adopted by the sole member effective 07 March 2025.
/s/ Signatory on Behalf of Maples Bermuda
For and on behalf of
Maples Corporate Services (Bermuda) Limited
Secretary
TABLE OF CONTENTS
BYE- LAW | PAGE | |||
POWER TO ISSUE SHARES |
10 | |||
POWER OF THE COMPANY TO PURCHASE ITS SHARES |
11 | |||
RIGHTS ATTACHING TO SHARES |
11 | |||
LIEN |
11 | |||
CALL ON SHARES |
12 | |||
FORFEITURE OF SHARES |
12 | |||
UNCERTIFICATED SHARES |
14 | |||
FRACTIONAL SHARES |
15 | |||
REGISTER OF SHAREHOLDERS |
15 | |||
REGISTERED HOLDER ABSOLUTE OWNER |
15 | |||
TRANSFER OF REGISTERED SHARES |
15 | |||
TRANSMISSION OF REGISTERED SHARES |
16 | |||
POWER TO ALTER CAPITAL |
17 | |||
VARIATION OF RIGHTS ATTACHING TO SHARES |
17 | |||
DIVIDENDS |
17 | |||
POWER TO SET ASIDE PROFITS |
18 | |||
METHOD OF PAYMENT |
18 | |||
CAPITALISATION |
18 | |||
ANNUAL GENERAL MEETINGS |
19 | |||
SPECIAL GENERAL MEETINGS |
19 | |||
REQUISITIONED GENERAL MEETINGS |
19 | |||
NOTICE |
19 | |||
GIVING NOTICE AND ACCESS |
19 | |||
POSTPONEMENT OF GENERAL MEETING |
20 |
2
ELECTRONIC PARTICIPATION IN MEETINGS |
20 | |||
QUORUM AT GENERAL MEETINGS |
21 | |||
CHAIR TO PRESIDE AT GENERAL MEETINGS |
21 | |||
VOTING ON RESOLUTIONS |
21 | |||
VOTING BY JOINT HOLDERS OF SHARES |
21 | |||
INSTRUMENT OF PROXY |
22 | |||
REPRESENTATION OF CORPORATE SHAREHOLDER |
22 | |||
ADJOURNMENT OF GENERAL MEETING |
22 | |||
WRITTEN RESOLUTIONS |
23 | |||
DIRECTORS’ ATTENDANCE AT GENERAL MEETINGS |
23 | |||
ELECTION OF DIRECTORS AND NOTICE OF SHAREHOLDER BUSINESS |
24 | |||
NUMBER OF DIRECTORS |
32 | |||
TERM OF OFFICE OF DIRECTORS |
32 | |||
REMOVAL OF DIRECTORS |
33 | |||
VACANCY IN THE OFFICE OF DIRECTOR |
33 | |||
DIRECTORS TO MANAGE BUSINESS |
34 | |||
POWERS OF THE BOARD OF DIRECTORS |
34 | |||
REGISTER OF DIRECTORS AND OFFICERS |
35 | |||
APPOINTMENT OF OFFICERS |
36 | |||
APPOINTMENT OF SECRETARY AND RESIDENT REPRESENTATIVE |
36 | |||
DUTIES OF OFFICERS |
36 | |||
DUTIES OF THE SECRETARY |
36 | |||
REMUNERATION OF OFFICERS |
36 | |||
REMUNERATION OF DIRECTORS |
36 | |||
CONFLICTS OF INTEREST |
36 | |||
CORPORATE OPPORTUNITY |
37 |
3
INDEMNIFICATION AND EXCULPATION OF DIRECTORS AND OFFICERS |
39 | |||
BOARD MEETINGS |
41 | |||
NOTICE OF BOARD MEETINGS |
41 | |||
ELECTRONIC PARTICIPATION IN MEETINGS |
41 | |||
QUORUM AT BOARD MEETINGS |
41 | |||
BOARD TO CONTINUE IN THE EVENT OF VACANCY |
42 | |||
CHAIR TO PRESIDE |
42 | |||
WRITTEN RESOLUTIONS |
42 | |||
VALIDITY OF PRIOR ACTS OF THE BOARD |
42 | |||
MINUTES |
42 | |||
PLACE WHERE CORPORATE RECORDS KEPT |
42 | |||
FORM AND USE OF SEAL |
42 | |||
BOOKS OF ACCOUNT |
43 | |||
FINANCIAL YEAR END |
43 | |||
ANNUAL AUDIT |
43 | |||
APPOINTMENT OF AUDITOR |
43 | |||
REMUNERATION OF AUDITOR |
43 | |||
DUTIES OF AUDITOR |
43 | |||
CHANGE TO THE COMPANY’S AUDITORS |
44 | |||
ACCESS TO RECORDS |
44 | |||
FINANCIAL STATEMENTS |
44 | |||
DISTRIBUTION OF AUDITOR’S REPORT |
44 | |||
VACANCY IN THE OFFICE OF AUDITOR |
44 | |||
WINDING-UP |
44 | |||
CHANGES TO BYE-LAWS |
44 | |||
CHANGES TO THE MEMORANDUM OF ASSOCIATION |
45 |
4
EXCLUSIVE JURISDICTION |
45 | |||
MERGER AND AMALGAMATION |
45 | |||
DISCONTINUANCE |
45 | |||
BUSINESS COMBINATIONS |
45 |
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DEFINITIONS
1. | In these Amended and Restated Bye-laws, the following words and expressions shall, where not inconsistent with the context, have the following meanings, respectively: |
“Affiliate(s)” and “Associate(s)” shall have the meanings attributed to such terms in Rule 12b-2 under the Exchange Act and the rules and regulations promulgated thereunder.
“Appointed Stock Exchange” means an appointed stock exchange as defined under the Companies Act.
“Auditor” means the auditor of the Company appointed by the Company to examine and report upon its accounts in accordance with the Companies Act, U.S. securities laws and accounting standards.
“Bermuda” means the Islands of Bermuda.
“Board” means the board of directors appointed or elected pursuant to these Bye-laws.
“Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on which banking institutions in New York, NY or Bermuda are authorized or obligated by law or executive order to close.
“Bye-laws” means these amended and restated bye-laws adopted by the Company with effect on the completion of the Listing, as from time to time amended.
“chair” means the Chair of the Board appointed in accordance with Bye-law 128.
“close of business” means 5:00 p.m. Eastern Standard Time, and if an applicable deadline falls on the close of business on a day that is not a Business Day, then the applicable deadline shall be deemed to be the close of business on the immediately preceding Business Day.
“Companies Act” means the Companies Act 1981 as amended from time to time.
“Company” means the company incorporated in Bermuda under the name of Kestra Medical Technologies, Ltd. on 20 May 2021 for which these Bye-laws are approved and confirmed.
“Corporate Status” means the status of a person who is or was a Director or Officer, of the Company or, while a Director or Officer of the Company, is or was serving at the request of the Company as a director, officer, partner, trustee, member, manager, employee, agent or fiduciary of any other Enterprise.
“Derivative Instrument” means any short position, profits interest, option, warrant, convertible security, share appreciation right, or similar right with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares of the Company or with a value derived in whole or in part from the value of any class or series of shares of the Company, or any derivative or synthetic arrangement having the characteristics of a long position in any class or series of shares of the Company, or any contract, derivative, swap or other transaction or series of transactions designed to produce economic benefits and risks that correspond substantially to the ownership of any class or series of shares of the Company, including due to the fact that the value of such contract, derivative, swap or other transaction or series of transactions is determined by reference to the price, value or volatility of any class or series of shares of the Company, whether or not such instrument, contract or right shall be subject to settlement in the underlying class or series of shares of the Company, through the delivery of cash or other property, or otherwise, and without regard to whether the Holder and any Shareholder Associated Person of such Holder may have entered into transactions that hedge or mitigate the economic effect of such instrument, contract or right, or any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the Company;
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“Director” means a director of the Company for the time being.
“Enterprise” means the Company and any corporation, partnership, joint venture, trust, limited liability company, employee benefit plan or other enterprise that the Indemnitee is or was serving at the request of the Company as a director, officer, trustee, partner, member, manager, employee, agent or fiduciary.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
“Expenses” means all reasonable direct and indirect costs, fees and expenses of any type or nature whatsoever and shall specifically include, without limitation, all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees and costs of experts and other professionals, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, participating, or being or preparing to be a witness in, or otherwise participating in, a Proceeding, or responding to, or objecting to, a request to provide discovery in any Proceeding. Expenses also shall include Expenses incurred in connection with any appeal resulting from any Proceeding, including without limitation the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent, and any federal, state, local or foreign taxes imposed on a person as a result of the actual or deemed receipt of any payments under Bye-law 147, as well as all reasonable attorneys’ fees and all other expenses incurred by or on behalf of the Indemnitee in connection with preparing and submitting any requests or statements for indemnification, advancement, contribution or any other right provided by Bye-law 147. Expenses, however, shall not include amounts paid in settlement by the Indemnitee or the amount of judgments or fines against the Indemnitee.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.
“Fullest Extent Permitted By Applicable Law” includes, but is not limited to: (i) to the fullest extent permitted by the applicable provision of the Companies Act, or the corresponding provision of any amendment to or replacement of the Companies Act, and (ii) in the case of Bye-laws 146 to 151, to the fullest extent authorized or permitted by any amendments to or replacements of the Companies Act adopted hereafter that increase the extent to which a company may indemnify its directors and officers.
“Holder(s)” has the meaning given to such term in Bye-law 111(1)(c).
“Indemnitee” means a person entitled to be indemnified by the Company pursuant to Bye-law 147.
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“Indemnification Agreement” means any agreement between the Company and an Indemnitee providing Indemnitee with rights to indemnification and advancement of expenses incurred in defending any Proceeding brought against the Indemnitee by virtue of Indemnitee’s Corporate Status, whether now existing or hereafter entered into.
“Identified Person” has the meaning given to such term in Bye-law 140.
“Interested Director” has the meaning given to such term in Bye-law 136.
“Listing” means the listing of the Company’s common shares on an Appointed Stock Exchange.
“Losses” means all liabilities, judgments, fines, penalties, costs, losses, excise taxes or penalties under ERISA, amounts paid in settlement (including all interest assessments and other charges paid or payable in connection with or in respect of such liabilities, losses, judgements, fines, excise taxes, penalties and costs) and other amounts that the Indemnitee reasonably incurs and that result from, arise in connection with or are by reason of the Indemnitee’s Corporate Status.
“Noticing Shareholder” has the meaning given to such term in Bye-law 111(1).
“Officer” means any person appointed by the Board to hold an office in the Company pursuant to section 91(4) of the Companies Act.
“Person” shall be construed broadly and shall include, without limitation, an individual, a partnership, a corporation, a limited liability partnership, an investment fund, a limited liability company, a company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
“Principal Shareholder” means, collectively, Bain Charger Holdings, L.P.
“Proceeding” includes any threatened, pending or completed action, suit, claim, counterclaim, cross claim, arbitration, mediation, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought by or in the right of the Company or otherwise and whether civil, criminal, administrative or investigative, in which the Indemnitee was, is or will be involved as a party, potential party, non-party witness or otherwise, by reason of the Indemnitee’s Corporate Status or by reason of any action taken by the Indemnitee or of any inaction on the Indemnitee’s part while acting in the Indemnitee’s Corporate Status, in each case whether or not the Indemnitee is acting or serving in any such capacity at the time any liability or expense is incurred for which indemnification can be provided under these Bye-laws, but excluding one initiated by an Indemnitee to enforce the Indemnitee’s rights under Bye-law 147.
“public announcement” means disclosure (a) in a press release released by the Company, provided such press release is released by the Company following its customary procedures, is reported by the Dow Jones News Service, Associated Press or comparable national news service, or is generally available on internet news sites, or (b) in a document publicly filed by the Company with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act and the rules and regulations promulgated thereunder.
“Register of Directors and Officers” means the register of directors and officers of the Company.
“Register of Shareholders” means the register of Shareholders of the Company.
“Registered Office” shall be at such place in Bermuda as the Board shall from time to time appoint.
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“Resident Representative” means any person appointed to act as resident representative and includes any deputy or assistant resident representative.
“Resolution” means a resolution passed by a simple majority of votes cast by Shareholders who are entitled to vote at such general meeting or by written resolution, each in accordance with the provisions of these Bye-laws.
“Secretary” means the person appointed to perform any or all of the duties of secretary of the Company and includes any deputy or assistant secretary and any person appointed by the Board to perform any of the duties of the Secretary.
“Securities Act” means the U.S. Securities Act of 1933, as amended.
“Shareholder” means the person registered in the Register of Shareholders as the holder of shares in the Company and, when two or more persons are so registered as joint holders of shares, means the person whose name stands first in the Register of Shareholders as one of such joint holders or all of such persons, as the context so requires.
“Shareholder Associated Person” shall mean as to any Holder (as defined in Bye-law 111): (1) any participant (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A under the Exchange Act, or any successor instructions) with any such Holder in a solicitation of proxies in respect of any business or director nomination proposed by such Holder, (2) any person acting in concert with such Holder, (3) any person controlling, controlled by or under common control with such Holder or any of their respective Affiliates and Associates, or person acting in concert therewith, (4) any member of the immediate family of such Holder or an Affiliate or Associate of such Holder, and (5) any person who is a member of a “group” (as such term is used in Rule 13d-5 under the Exchange Act (or any successor provision)) with such Holder.
“shares” means a share in the capital of the Company of any class.
“Short Interest” means any agreement, arrangement, understanding relationship or otherwise, including any repurchase or similar so-called “share borrowing” agreement or arrangement, involving any Holder or any Shareholder Associated Person, the purpose or effect of which is to mitigate loss to, reduce the economic risk (of ownership or otherwise) or any shares of the Company by, manage the risk of share price changes for, or increase or decrease the voting power of, such Holder or any Shareholder Associated Person with respect to any shares or other securities of the Company, or which provides, directly or indirectly, the opportunity to profit or share in any profit derived from any decrease in the price or value of any shares or other securities of the Company.
“Specified Information” has the meaning given to such term in Bye-law 111(c)(ii).
“Special Resolution” means a resolution passed by Shareholders holding at least 66 2/3% of the issued shares who are entitled to vote at such general meeting or by written resolution, each in accordance with the provisions of these Bye-laws.
“Treasury Share” means a share of the Company that was or is treated as having been acquired and held by the Company and has been held continuously by the Company since it was so acquired and has not been cancelled.
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“Trigger Event” means the date on which the Principal Shareholder and its Affiliates collectively cease to beneficially own (as defined in Rule 13d-3 under the Exchange Act (or any successor provision) of at least 50% of the issued common shares of the Company.
“Voting Commitment” has the meaning given to such term in Bye-law 111(7).
2. | In these Bye-laws, where not inconsistent with the context: |
(a) | words denoting the plural number include the singular number and vice versa; |
(b) | words denoting the masculine gender include the feminine and neuter genders; |
(c) | a reference to statutory provision shall be deemed to include any amendment or re-enactment thereof; |
(d) | the word “may” shall be construed as permissive and the word “shall” shall be construed as imperative; and |
(e) | unless otherwise provided herein, words or expressions defined in the Companies Act shall bear the same meaning in these Bye-laws. |
3. | In these Bye-laws expressions referring to writing or its cognates shall, unless the contrary intention appears, include facsimile, printing, lithography, photography, electronic mail and other modes of representing words in visible form. |
4. | Headings used in these Bye-laws are for convenience only and are not to be used or relied upon in the construction hereof. |
POWER TO ISSUE SHARES
5. | Subject to these Bye-laws, the Board shall have the power to issue any unissued shares on such terms and conditions as it may determine and any shares or class of shares may be issued with such preferred, deferred or other special rights or such restrictions, whether in regard to dividend, voting, return of capital, or otherwise as the Board may determine. |
6. | The Board is expressly authorised (and the Board is hereby authorised to exercise such power from time to time without a Resolution) to issue, pursuant to a resolution of the Board, all or any preference shares in one or more series, to fix the number of shares constituting such series and to increase or decrease the number of shares of any such series (but not below the number of shares thereof then issued) and to fix for each such series such voting powers and such distinctive designations, powers, preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof, as shall be stated and expressed in the resolution or resolutions adopted by the Board providing for the issuance of such series (and, for the avoidance of doubt, such matters and the issuance of such preference shares shall not be deemed to vary the rights attached to the common shares or, subject to the terms of any other series of preference shares, to vary the rights attached to any other series of preference shares) including, without limitation, the authority to provide that any such series may be (a) subject to redemption at such time or times (including at a determinable date or at the option of the Company or the holder) and at such price or prices; (b) entitled to receive dividends (which may be cumulative or non-cumulative) at such rates, on such conditions, and at such times, and payable in preference to, or in such relation to, the dividends payable on any other class or classes or any other series; (c) entitled to such rights upon the dissolution of, or upon any distribution of the assets of, the |
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Company; or (d) convertible into, or exchangeable for, shares of any other class or classes of shares, or of any other series of the same or any other class or classes of shares, of the Company at such price or prices or at such rates of exchange and with such adjustments, all as may be stated in such resolution or resolutions of the Board. |
7. | Subject to the Companies Act and the terms of any preference shares established by the Board, any preference shares may be convertible into, or exchangeable for shares that (at a determinable date or at the option of the Company or the holder) are liable to be redeemed on such terms and in such manner as may be determined by the Board without a Resolution. |
POWER OF THE COMPANY TO PURCHASE ITS SHARES
8. | The Company may purchase its own shares for cancellation or acquire them as Treasury Shares in accordance with the Companies Act on such terms as the Board shall think fit. |
9. | The Board may exercise all the powers of the Company to purchase or acquire all or any part of its own shares in accordance with the Companies Act. |
RIGHTS ATTACHING TO SHARES
10. | Subject to any Resolution to the contrary (and without prejudice to any special rights conferred thereby on the holders of any other shares or class of shares) and to the authority of the Board to issue preference shares pursuant to Bye-law 6, the share capital shall be divided into shares of a single class the holders of which shall, subject to these Bye-laws: |
(a) | be entitled to one vote per share; |
(b) | be entitled to such dividends as the Board may from time to time declare; |
(c) | in the event of a winding-up or dissolution of the Company, whether voluntary or involuntary or for the purpose of a reorganisation or otherwise or upon any distribution of capital, be entitled to the surplus assets of the Company; and |
(d) | generally be entitled to enjoy all of the rights attaching to shares. |
11. | All the rights attaching to a Treasury Share shall be suspended and shall not be exercised by the Company while it holds such Treasury Share and, except where required by the Companies Act, all Treasury Shares shall be excluded from the calculation of any percentage or fraction of the share capital, or shares, of the Company. |
LIEN
12. | The Company shall have a first and paramount lien on every share (not being a fully paid share) for all moneys called or payable to the Company (whether presently or not) in respect of that share. The Company’s lien on a share shall extend to any amount (including without limitation dividends) payable in respect of it. The Board may at any time (generally or in a particular case) waive any lien or declare any share to be wholly or in part exempt from the provisions of this Bye-law 12. |
13. | The Company may sell, in such manner as the Board may think fit, any share on which the Company has a lien if a sum in respect of which the lien exists is presently payable and is not paid within 14 days after notice in writing has been sent to the holder of the share, or to the person entitled to it by transmission, demanding payment and stating that if the notice is not complied with the share may be sold. |
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14. | To give effect to that sale the Board may, if the share is a certificated share, authorise any person to execute an instrument of transfer in respect of the share sold to, or in accordance with the directions of, the buyer. If the share is an uncertificated share, the Board may exercise any of the Company’s powers under Bye-law 34 to effect the sale of the share to, or in accordance with the directions of, the buyer. The buyer shall not be bound to see to the application of the purchase money and his or her title to the share shall not be affected by any irregularity in or invalidity of the proceedings in relation to the sale. |
15. | The net proceeds of the sale by the Company of any shares on which it has a lien, after payment of the costs, shall be applied in or towards payment or satisfaction of so much of the sum in respect of which the lien exists as is presently payable. Any residue shall (if the share sold is a certificated share, on surrender to the Company for cancellation of the certificate in respect of the share sold and, whether the share sold is a certificated or uncertificated share, subject to a like lien for any moneys not presently payable as existed on the share before the sale) be paid to the person entitled to the share at the date of the sale. |
CALL ON SHARES
16. | The Board may make such calls as it thinks fit upon the Shareholders in respect of any moneys (whether in respect of nominal value or premium) unpaid on the shares allotted to or held by such Shareholders and, if a call is not paid on or before the day appointed for payment thereof, the Shareholder may at the discretion of the Board be liable to pay the Company interest on the amount of such call at such rate as the Board may determine, from the date when such call was payable up to the Company’s actual date of payment. The Board may differentiate between the holders as to the amount of calls to be paid and the times of payment of such calls. |
17. | The joint holders of a share shall be jointly and severally liable to pay all calls and any interest, costs and expenses in respect thereof. |
18. | The Company may accept from any Shareholder the whole or a part of the amount remaining unpaid on any shares held by such Shareholder, although no part of that amount has been called up. |
FORFEITURE OF SHARES
19. | If a Shareholder fails to pay any call or instalment of a call on the day appointed for payment thereof, the Board may at any time thereafter during such time as any part of such call or instalment remains unpaid serve a notice on such Shareholder, requiring payment of so much of the call or instalment as is unpaid, together with any interest which may have accrued. |
20. | The notice shall name a further day (not being less than 14 days from the date of the notice) on or before which, and the place where, the payment required by the notice is to be made and shall state that, in the event of non-payment on or before the day and at the place appointed, the shares in respect of which such call is made or instalment is payable will be liable to be forfeited. |
21. | If the requirements of any such notice as aforesaid are not complied with, any share in respect of which such notice has been given may at any time thereafter, before payment of all calls or instalments and interest due in respect thereof has been made, be forfeited by a resolution of the Board to that effect. Such forfeiture shall include all dividends or other moneys payable declared in respect of the forfeited shares and not actually paid before the forfeiture. |
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22. | When any share has been forfeited, notice of the forfeiture shall be served upon the person who was the holder of the share before the forfeiture. Where the forfeited share is held in certificated form, an entry shall be made promptly in the register opposite the entry of the share showing that notice has been sent, that the share has been forfeited and the date of forfeiture. No forfeiture shall be in any manner invalidated by any omission or neglect to give such notice. |
23. | A forfeited share shall be deemed to be the property of the Company and may be sold, re-offered or otherwise disposed of either to the person who was the holder of the share before the forfeiture or to any other person upon such terms and in such manner as the Board shall think fit. At any time before a sale, re-allotment or disposal, the forfeiture may be cancelled on such terms as the Board may think fit. Where for the purposes of its disposal a forfeited share held in certificated form is to be transferred to any person, the Board may authorise any person to execute an instrument of transfer of the share to that person. Where for the purposes of its disposal a forfeited share held in uncertificated form is to be transferred to any person, the Board may exercise any of the Company’s powers under Bye-law 34. The Company may receive the consideration given for the share on its sale, re-offer or disposal and may register the transferee as holder of the share. |
24. | A person shall cease to be a Shareholder in respect of any share which has been forfeited and shall, if the share is a certificated share, surrender the certificate for any forfeited share to the Company for cancellation. Notwithstanding the forfeiture, the person shall remain liable to the Company for all moneys which at the date of forfeiture were presently payable by such person to the Company in respect of that share with interest on that amount at the rate at which interest was payable on those moneys before the forfeiture or, if no interest was so payable, at the rate determined by the Board from the date of forfeiture until payment. The Board may waive payment wholly or in part or enforce payment without any allowance for the value of the share at the time of forfeiture or for any consideration received on its disposal. |
25. | The Board may accept the surrender of any share liable to be forfeited hereunder on such terms and conditions as may be agreed and, in such case, subject to those terms and conditions, references in these Bye-laws to forfeiture shall include surrender. |
26. | The forfeiture of a share shall involve the extinction at the time of forfeiture of all interest in and all claims and demands against the Company in respect of the share and all other rights and liabilities incidental to the share as between the person whose share is forfeited and the Company, except only those rights and liabilities expressly saved by these Bye-laws, or as are given or imposed in the case of past Shareholders by the Companies Act. |
27. | An affidavit in writing that the deponent is a Director or the Secretary and that a share has been duly forfeited on the date stated in the affidavit shall be conclusive evidence of the facts therein stated as against all persons claiming to be entitled to the share. The declaration shall (subject if necessary to the execution of an instrument of transfer or transfer by means of the relevant system, as the case may be) constitute a good title to the share. The person to whom the share is disposed of shall not be bound to see to the application of the purchase money, if any, and such person’s title to the share shall not be affected by any irregularity in, or invalidity of, the proceedings in reference to the forfeiture, surrender, sale, re-allotment or disposal of the share. |
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SHARE CERTIFICATES
28. | Every Shareholder of certificated shares shall be entitled to a certificate under the common seal of the Company or bearing the signature (or a facsimile thereof) of a Director or the Secretary or a person expressly authorised to sign specifying the number and, where appropriate, the class of shares held by such Shareholder and whether the same are fully paid up and, if not, specifying the amount paid on such shares. The Board may by resolution determine, either generally or in a particular case, that any or all signatures on certificates may be printed thereon or affixed by mechanical means. |
29. | The Company shall be under no obligation to complete and deliver a share certificate unless specifically called upon to do so by the person to whom the certificated shares have been allotted. |
30. | The holder of any certificated shares of the Company shall immediately notify the Company of any loss, destruction or mutilation of the certificate therefor, and the Board may, in its discretion, cause to be issued to such holder a new certificate or certificates for such shares, upon the surrender of the mutilated certificates or, in the case of loss or destruction of the certificate, upon satisfactory proof of such loss or destruction, and the Board may, in its discretion, require the owner of the lost or destroyed certificate or their legal representative to give the Company a bond in such sum and with such surety or sureties as it may direct to indemnify the Company against any claim that may be made against it on account of the alleged loss or destruction of any such certificate. |
31. | For such time as any shares of the Company are traded on an Appointed Stock Exchange, nothing in these Bye-laws shall prevent title to any shares of the Company from being evidenced and/or transferred without a written instrument in accordance with the rules or regulations applicable to shares listed on any such Appointed Stock Exchange, and the Board shall have power to implement any arrangements which it may think fit for such evidencing and/or transfer. |
UNCERTIFICATED SHARES
32. | Subject to the provisions of the Companies Act, the Board may permit the holding of shares in any class of shares in uncertificated form and the transfer of title of shares in that class by means of the relevant system used by an Appointed Stock Exchange or any other relevant system and may determine that any class of shares shall cease to be a participating security of any relevant system. |
33. | Shares in the capital of the Company that fall within a certain class shall not form a separate class of shares from other shares in that class because any share in that class is held in uncertificated form. |
34. | Where any class of shares is uncertificated and the Company is entitled under any provision of the Companies Act or these Bye-laws to sell, transfer or otherwise dispose of, forfeit, re-allot, accept the surrender of, or otherwise enforce a lien over, a share held in uncertificated form, the Company shall be entitled, subject to the provisions of the Companies Act or these Bye-laws and the facilities and requirements of the relevant system: |
(a) | to require the holder of that uncertificated share by notice to change that share into certificated form within the period specified in the notice and to hold that share in certificated form so long as required by the Company; |
(b) | to require the holder of that uncertificated share by notice to give any instructions necessary to transfer title to that share by means of the relevant system within the period specified in the notice; |
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(c) | to require the holder of that uncertificated share by notice to appoint any person to take any step, including, without limitation, the giving of any instructions by means of the relevant system, necessary to transfer the share within the period specified in the notice; and |
(d) | to take any action that the Board considers appropriate to achieve the sale, transfer, disposal, forfeiture, re-allotment or surrender of that share, or otherwise to enforce a lien in respect of that share. |
FRACTIONAL SHARES
35. | The Company may issue its shares in fractional denominations and deal with such fractions to the same extent as its whole shares and shares in fractional denominations shall have in proportion to the respective fractions represented thereby all of the rights of whole shares including (but without limiting the generality of the foregoing) the right to vote, to receive dividends and distributions and to participate in a winding-up. |
REGISTER OF SHAREHOLDERS
36. | The Board shall cause to be kept in one or more books a Register of Shareholders and shall enter therein the particulars required by the Companies Act. Subject to the provisions of the Companies Act, the Company may keep one or more overseas or branch registers in any place, and the Board may make, amend and revoke any such regulations as it may think fit regarding the keeping of such registers. The Board may authorise any share on the Register of Shareholders to be included in a branch register or any share registered on a branch register to be registered on another branch register; provided that at all times the Register of Shareholders is maintained in accordance with the Companies Act. |
37. | The Register of Shareholders shall be open to inspection, by Shareholders and other persons entitled to inspect it under applicable law, without charge at the Registered Office of the Company on every Business Day, subject to such reasonable restrictions as the Board may impose, so that not less than two hours in each Business Day be allowed for inspection. The Register of Shareholders may, after notice has been given in accordance with the Companies Act, be closed for any time or times not exceeding in the whole 30 days in each year. |
REGISTERED HOLDER ABSOLUTE OWNER
38. | The Company shall be entitled to treat the registered holder of any share as the absolute owner thereof and accordingly shall not be bound to recognise any equitable claim or other claim to, or interest in, such share on the part of any other person. |
TRANSFER OF REGISTERED SHARES
39. | An instrument of transfer of a certificated share shall be in writing in such form as the Board may accept. |
40. | Such instrument of transfer shall be signed by or on behalf of the transferor and transferee; provided that, in the case of a fully paid share, the Board may accept the instrument signed by or on behalf of the transferor alone. The transferor shall be deemed to remain the holder of such share until the same has been registered as having been transferred to the transferee in the Register of Shareholders. |
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41. | The Board may refuse to recognise any instrument of transfer on the basis that such share is not fully paid. |
42. | The Board may refuse to recognise any instrument of transfer of a certificated share unless it is accompanied by the certificate in respect of the shares to which it relates and by such other evidence as the Board may reasonably require to show the right of the transferor to make the transfer. |
43. | In the case of a transfer of a certificated share, the certificate in respect of the shares to which it relates will only be necessary if and to the extent that a certificate has been issued in respect of the share in question. |
44. | The joint holders of any share may transfer such share to one or more of such joint holders, and the surviving holder or holders of any share previously held by them jointly with a deceased Shareholder may transfer any such share to the executors or administrators of such deceased Shareholder. |
45. | The Board shall refuse to register a transfer unless all applicable consents, authorisations and permissions of any governmental body or agency in Bermuda have been obtained. If the Board refuses to register a transfer of any share the Secretary shall, within three months after the date on which the transfer was lodged with the Company, send to the transferor and transferee notice of the refusal. |
46. | Shares may be transferred without a written instrument if transferred by an appointed agent or otherwise in accordance with the Companies Act. |
47. | Notwithstanding anything to the contrary in these Bye-laws, shares that are listed or admitted to trading on an Appointed Stock Exchange may be transferred in accordance with the rules and regulations of such exchange. |
TRANSMISSION OF REGISTERED SHARES
48. | In the case of the death of a Shareholder, the survivor or survivors where the deceased Shareholder was a joint holder, and the legal personal representatives of the deceased Shareholder where the deceased Shareholder was a sole holder, shall be the only persons recognised by the Company as having any title to the deceased Shareholder’s interest in the shares. Nothing herein contained shall release the estate of a deceased joint holder from any liability in respect of any share which had been jointly held by such deceased Shareholder with other persons. Subject to the Companies Act, for the purpose of this Bye-law, legal personal representative means the executor or administrator of a deceased Shareholder or such other person as the Board may, in its absolute discretion, decide as being properly authorised to deal with the shares of a deceased Shareholder. |
49. | Any person becoming entitled to a share in consequence of the death or bankruptcy of any Shareholder may be registered as a Shareholder upon such evidence as the Board may deem sufficient or may elect to nominate some person to be registered as a transferee of such share, and in such case the person becoming entitled shall (a) if the share is a certificated share, execute in favour of such nominee an instrument of transfer in writing in such form as the Board may accept, or (b) if the share is an uncertificated share, take any action the Board may require (including without limitation the execution of any document and the giving of any instruction by means of a relevant system of an Appointed Stock Exchange). |
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50. | On the presentation of the foregoing materials to the Board, accompanied by such evidence as the Board may require to prove the title of the transferor, the transferee shall be registered as a Shareholder. |
51. | Where two or more persons are registered as joint holders of a share or shares, then in the event of the death of any joint holder or holders the remaining joint holder or holders shall be absolutely entitled to such share or shares and the Company shall recognise no claim in respect of the estate of any joint holder except in the case of the last survivor of such joint holders. |
POWER TO ALTER CAPITAL
52. | The Company may, if authorised by resolution of the Board, divide, consolidate and subdivide its share capital in any manner permitted by the Companies Act. |
53. | The Company may, if authorised by Resolution, increase, reduce, change the currency denomination of, cancel, diminish or otherwise alter its share capital in any manner permitted by the Companies Act. |
54. | Where, on any alteration or reduction of share capital, fractions of shares or some other difficulty would arise, the Board may deal with or resolve the same in such manner as it thinks fit. |
VARIATION OF RIGHTS ATTACHING TO SHARES
55. | If, at any time, the share capital is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may, whether or not the Company is being wound-up, be varied with the consent in writing of the holders of three-fourths of the issued shares of that class or with the sanction of a resolution passed by a majority of the votes cast at a separate general meeting of the holders of the shares of the class at which meeting the necessary quorum (where the Company has more than one shareholder) shall be two persons at least holding or representing by proxy one-third of the issued shares of the class. The rights conferred upon the holders of the shares of any class issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith. |
DIVIDENDS
56. | The Board may, subject to these Bye-laws and the preferred dividend rights of the holders of any preference shares and in accordance with the Companies Act, declare a dividend to be paid to the Shareholders, in proportion to the number of shares held by them, and such dividend may be paid in cash or wholly or partly in specie in which case the Board may fix the value for distribution in specie of any assets. |
57. | The Board may fix any date as the record date for determining the Shareholders entitled to receive any dividend. |
58. | The Company may pay dividends in proportion to the amount paid up on each share where a larger amount is paid up on some shares than on others. |
59. | The Board may declare and make such other distributions (in cash or in specie) to the Shareholders as may be lawfully made out of the assets of the Company. |
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POWER TO SET ASIDE PROFITS
60. | The Board may, before declaring a dividend, set aside out of the surplus or profits of the Company, such amount as it thinks proper as a reserve to be used to meet contingencies or for equalising dividends or for any other purpose. |
METHOD OF PAYMENT
61. | Any dividend, interest or other moneys payable in cash in respect of the shares may be paid by cheque or draft sent through the post directed to the Shareholder at such Shareholder’s address in the Register of Shareholders, or to such person and to such address as the Shareholder may in writing direct. |
62. | In the case of joint holders of shares, any dividend, interest or other moneys payable in cash in respect of shares may be paid by cheque or draft sent through the post directed to the address of the holder first named in the Register of Shareholders, or to such person and to such address as the joint holders may in writing direct. If two or more persons are registered as joint holders of any shares any one can give an effectual receipt for any dividend paid in respect of such shares. |
63. | The Board may deduct from the dividends or distributions payable to any Shareholder all moneys due from such Shareholder to the Company on account of calls or otherwise. |
64. | Any dividend and or other monies payable in respect of a share which has remained unclaimed for 6 years from the date when it became due for payment shall, if the Board so resolves, be forfeited and cease to remain owing by the Company. The payment of any unclaimed dividend or other moneys payable in respect of a share may (but need not) be paid by the Company into an account separate from the Company’s own account. Such payment shall not constitute the Company a trustee in respect thereof. |
65. | The Company shall be entitled to cease sending dividend cheques and warrants by post or otherwise to a Shareholder if those instruments have been returned undelivered to, or left uncashed by, that Shareholder on at least two consecutive occasions, or, following one such occasion, reasonable enquiries have failed to establish the Shareholder’s new address. The entitlement conferred on the Company by this Bye-law in respect of any Shareholder shall cease if the Shareholder claims a dividend or cashes a dividend cheque or warrant. |
CAPITALISATION
66. | The Board may capitalise any amount for the time being standing to the credit of any of the Company’s share premium or other reserve accounts or to the credit of the profit and loss account or otherwise available for distribution by applying such amount in paying up unissued shares to be allotted as fully paid bonus shares pro rata to the Shareholders. |
67. | The Board may capitalise any amount for the time being standing to the credit of a reserve account or amounts otherwise available for dividend or distribution by applying such amounts in paying up in full, partly or nil paid shares of those Shareholders who would have been entitled to such amounts if they were distributed by way of dividend or distribution. |
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ANNUAL GENERAL MEETINGS
68. | Subject to any rights to waive the annual general meeting pursuant to the Companies Act, the annual general meeting of Shareholders for the election of directors and for the transaction of such other business as may properly come before the meeting in accordance with these Bye-laws shall be held in each calendar year (other than the year of incorporation) at such place, date and hour as shall be fixed by the Board. The Board may postpone, reschedule or cancel any previously scheduled annual general meeting. |
SPECIAL GENERAL MEETINGS
69. | The Board may convene a special general meeting of Shareholders for any purpose or purposes whenever in their judgment such a meeting is necessary to be held at such place, date and hour as fixed by the Board. The Board may postpone, reschedule or cancel any previously scheduled special general meeting. |
REQUISITIONED GENERAL MEETINGS
70. | The Board shall, on the requisition of Shareholders holding at the date of the deposit of the requisition not less than one-tenth of such of the paid-up share capital of the Company as at the date of the deposit carries the right to vote at general meetings, proceed duly to convene a special general meeting and the provisions of the Companies Act shall apply. |
NOTICE
71. | Notice of an annual general meeting shall be given to each Shareholder entitled to attend and vote thereat at least 10 days but no more than 60 days prior to the date of such meeting. The notice shall state the date, time and place at which the meeting is to be held, that the election of Directors will take place thereat, and the general nature of the other business to be conducted at the meeting. |
72. | Notice of a special general meeting shall be given to each Shareholder entitled to attend and vote thereat at least 10 days but no more than 60 days prior to the date of such meeting. The notice shall state the date, time, place at which the meeting is to be held and the general nature of the business to be considered at the meeting. |
73. | The Board may fix any date as the record date for determining the Shareholders entitled to receive notice of and to vote at any general meeting. |
74. | A general meeting shall, notwithstanding that it is called on shorter notice than that specified in these Bye-laws, be deemed to have been properly called if it is so agreed by (i) all the Shareholders entitled to attend and vote thereat in the case of an annual general meeting; and (ii) by a majority in number of the Shareholders having the right to attend and vote at the meeting, being a majority together holding not less than 95% in nominal value of the shares giving a right to attend and vote thereat in the case of a special general meeting. |
75. | The accidental omission to give notice of a general meeting to, or the non-receipt of a notice of a general meeting by, any person entitled to receive notice shall not invalidate the proceedings at that meeting. |
GIVING NOTICE AND ACCESS
76. | A notice may be given by the Company to a Shareholder: |
(a) | by delivering it to such Shareholder in person; or |
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(b) | by sending it by letter mail or courier to such Shareholder’s address in the Register of Shareholders; or |
(c) | by transmitting it by electronic means (including facsimile and electronic mail, but not telephone) in accordance with such directions as may be given by such Shareholder to the Company for such purpose; or |
(d) | in accordance with Bye-law 79. |
77. | Any notice required to be given to a Shareholder shall, with respect to any shares held jointly by two or more persons, be given to whichever of such persons is named first in the Register of Shareholders and notice so given shall be sufficient notice to all the holders of such shares. |
78. | Any notice (save for one delivered in accordance with Bye-law 79) shall be deemed to have been served at the time when the same would be delivered in the ordinary course of transmission and, in proving such service, it shall be sufficient to prove that the notice was properly addressed and prepaid, if posted, and the time when it was posted, delivered to the courier or transmitted by electronic means. |
79. | Where a Shareholder indicates their consent (in a form and manner satisfactory to the Board), to receive information or documents by accessing them on a website rather than by other means, or receipt in this manner is otherwise permitted by the Companies Act, the Board may deliver such information or documents by providing the Shareholder the address of the website where such information or documents are available and instructions as to how such information or documents may be accessed on the website. |
80. | In the case of information or documents delivered in accordance with Bye-law 79, service shall be deemed to have occurred on the later of the date when (i) the Shareholder is notified in accordance with that Bye-law; and (ii) the information or document is published on the website. |
POSTPONEMENT OF GENERAL MEETING
81. | The chair may postpone any general meeting called in accordance with these Bye-laws (other than a meeting requisitioned under these Bye-laws) provided that notice of postponement is given to the Shareholders before the time for such meeting. Fresh notice of the date, time and place for the postponed meeting shall be given to each Shareholder in accordance with these Bye-laws. |
ELECTRONIC PARTICIPATION IN MEETINGS
82. | In relation to any general meeting, the Board may at its discretion, and subject to any restrictions it may impose, permit the participation by Shareholders in such general meeting by telephonic, electronic or other communication facilities or means that permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously and participation in such a meeting shall constitute presence in person at such meeting. |
83. | The Board, and at any general meeting, the chair of such meeting, may make any arrangement and impose any requirement or restriction it considers appropriate to ensure the safety and security of a general meeting including, without limitation, requirements for evidence of identity to be produced by those attending the meeting, the searching of their personal property and the restriction of items that may be taken into the meeting place. The Board and, at any general meeting, the chair of such meeting, are entitled to refuse entry to a person who refuses to comply with any such arrangements, requirements or restrictions. |
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QUORUM AT GENERAL MEETINGS
84. | At any general meeting two or more persons present in person and representing in person or by proxy in excess of 50% of the total issued shares in the Company that are entitled to vote throughout the meeting shall form a quorum for the transaction of business; provided that if the Company shall at any time have only one Shareholder, one Shareholder present in person or by proxy shall form a quorum for the transaction of business at any general meeting held during such time. |
85. | If at the time appointed for the meeting a quorum is not present, then, in the case of a meeting convened on a requisition, the meeting shall be deemed cancelled and, in any other case, the meeting shall stand adjourned to the same day one week later, at the same time and place or to such other day, time or place as any Officer may determine. Unless the meeting is adjourned to a specific date, time and place announced at the meeting being adjourned, fresh notice of the resumption of the meeting shall be given to each Shareholder entitled to attend and vote thereat in accordance with these Bye-laws. |
CHAIR TO PRESIDE AT GENERAL MEETINGS
86. | Unless otherwise agreed by Shareholders holding at least a majority of the shares entitled to vote and present in person or by proxy at the applicable general meeting, the chair, if there be one, and if not the president, if there be one, shall act as chair at all general meetings at which such person is present. In their absence, a chair shall be appointed or elected by the Board or, if not appointed or elected by the Board, the chair shall be appointed by any Officer of the Company. |
VOTING ON RESOLUTIONS
87. | Subject to the Companies Act and these Bye-laws, any question proposed for the consideration of the Shareholders at any general meeting shall be decided by the affirmative votes of a majority of the votes cast at such general meeting in accordance with these Bye-laws and in the case of an equality of votes the resolution shall fail. |
88. | No Shareholder shall be entitled to vote at a general meeting unless such Shareholder has paid all the calls on all shares held by such Shareholder. |
89. | At any general meeting a resolution put to the vote of the meeting shall be voted on by way of a poll. Subject to any rights or restrictions for the time being lawfully attached to any class of shares, and subject to these Bye-laws, every person present at such meeting shall have one vote for each share of which such person is the holder or for which such person holds a valid proxy. |
90. | At any general meeting if an amendment is proposed to any resolution under consideration and the chair of the meeting rules on whether or not the proposed amendment is out of order, the proceedings on the substantive resolution shall not be invalidated by any error in such ruling. |
VOTING BY JOINT HOLDERS OF SHARES
91. | In the case of joint holders, the vote of the senior who tenders a vote (whether in person or by proxy) shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the Register of Shareholders. |
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INSTRUMENT OF PROXY
92. | An instrument appointing a proxy shall be in writing in such form as the chair of the meeting shall accept. |
93. | The instrument appointing a proxy must be received by the Company at the Registered Office or at such other place or in such manner as is specified in the notice convening the meeting or in any instrument of proxy sent out by the Company in relation to the meeting at which the person named in the instrument appointing a proxy proposes to vote, and an instrument appointing a proxy which is not received in the manner so prescribed shall be invalid. |
94. | A Shareholder who is the holder of two or more shares may appoint more than one proxy to represent such Shareholder and vote on such Shareholder’s behalf in respect of different shares. |
95. | The decision of the chair of any general meeting as to the validity of any appointment of a proxy shall be final. |
REPRESENTATION OF CORPORATE SHAREHOLDER
96. | A corporation which is a Shareholder may, by written instrument, authorise such person or persons as it thinks fit to act as its representative at any meeting and any person so authorised shall be entitled to exercise the same powers on behalf of the corporation which such person represents as that corporation could exercise if it were an individual Shareholder, and that Shareholder shall be deemed to be present in person at any such meeting attended by its authorised representative or representatives. |
97. | Notwithstanding the foregoing, the chair of the meeting may accept such assurances as he or she thinks fit as to the right of any person to attend and vote at general meetings on behalf of a corporation which is a Shareholder. |
ADJOURNMENT OF GENERAL MEETING
98. | The chair of a general meeting may, with the consent of Shareholders holding at least a majority of the shares entitled to vote and present in person or by proxy at a general meeting at which quorum is present, and shall if so directed by the meeting, adjourn the meeting. Unless the meeting is adjourned to a specific date, place and time announced at the meeting being adjourned, fresh notice of the date, place and time for the resumption of the adjourned meeting shall be given to each Shareholder entitled to attend and vote thereat in accordance with these Bye-laws. |
99. | In addition, the chair of a general meeting may adjourn the meeting to another time and place without such consent or direction if it appears to such person that: |
(a) | it is likely to be impracticable to hold or continue to that meeting because of the number of Shareholders wishing to attend who are not present; or |
(b) | the unruly conduct of persons attending the meeting prevents, or is likely to prevent, the orderly continuation of the business of the meeting; or |
(c) | an adjournment is otherwise necessary, in the sole discretion of the chair, so that the business of the meeting may be properly conducted. |
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WRITTEN RESOLUTIONS
100. | Subject to these Bye-laws, anything which may be done by Resolution or Special Resolution in a general meeting or by Resolution or Special Resolution of a meeting of any class of the Shareholders may, without a meeting, be done by written resolution in accordance with Bye-laws 101-107. |
101. | Notice of a written Resolution or Special Resolution shall be given, and a copy of the Resolution or Special Resolution, as applicable, shall be circulated to all Shareholders who would be entitled to attend a meeting and vote thereon. The accidental omission to give notice to, or the non-receipt of a notice by, any Shareholder does not invalidate the passing of a resolution. |
102. | Prior to the Trigger Event, a written Resolution or Special Resolution is passed when it is signed by, or on behalf of, the Shareholders who at the date that the notice is given represent such number of votes as would be required if the resolution was voted on at a meeting of Shareholders at which all Shareholders entitled to attend and vote thereat were present and voting. From and after the Trigger Event, a written Resolution or Special Resolution is passed when it is unanimously signed by, or on behalf of, the Shareholders who at the date that the notice is given represent all Shareholders who would be entitled to attend the meeting and vote on the Resolution or Special Resolution, as applicable. |
103. | A resolution in writing may be signed in any number of counterparts. |
104. | A written Resolution or Special Resolution made in accordance with these Bye-laws is as valid as if it had been passed by the Company in general meeting or by a meeting of the relevant class of Shareholders, as the case may be, and any reference in any Bye-law to a meeting at which a Resolution or Special Resolution is passed or to Shareholders voting in favour of a Resolution or Special Resolution shall be construed accordingly. |
105. | A written Resolution or Special Resolution made in accordance with these Bye-laws shall constitute minutes for the purposes of the Companies Act. |
106. | Bye-law 100 shall not apply to: |
(a) | a Resolution passed to remove an Auditor from office before the expiration of their term of office; or |
(b) | a Resolution or Special Resolution passed for the purpose of removing a Director before the expiration of their term of office. |
107. | For the purposes of these Bye-laws, the effective date of a written Resolution or Special Resolution is the date when it is signed by, or in the case of a Shareholder that is a corporation whether or not a company within the meaning of the Companies Act, on behalf of, the last Shareholder whose signature results in the necessary voting threshold being achieved and any reference in any Bye-law to the date of passing of a Resolution or Special Resolution is, in relation to a Resolution or Special Resolution made in accordance with these Bye-laws, a reference to such date. |
DIRECTORS’ ATTENDANCE AT GENERAL MEETINGS
108. | The Directors shall be entitled to receive notice of, attend and be heard at any general meeting. |
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ELECTION OF DIRECTORS AND NOTICE OF SHAREHOLDER BUSINESS
109. | The Board shall be elected or appointed in the first place at the statutory meeting of the Company and thereafter, except in the case of a casual vacancy, by Resolution at the annual general meeting or at any special general meeting called for that purpose in accordance with these Bye-laws. |
110. | (1) Nominations of persons for election to the Board and the proposal of other business may be made at any annual general meeting only: |
(a) | pursuant to the Company’s notice of meeting (or any supplement thereto) delivered pursuant to Bye-law 71; |
(b) | by or at the direction of the Board (or any duly authorised committee thereof) or at the direction of the Court pursuant to the Companies Act; or |
(c) | by any Shareholder who: |
(i) is a Shareholder on the record date for the determination of Shareholders entitled to vote at such meeting, on the date of the giving of the notice referred to in Bye-law 111 and at the time of the meeting; and
(ii) complies with the notice procedures set out in Bye-law 111;
(2) Only such business (including the election of specific individuals to fill vacancies or newly created directorships on the Board) shall be conducted at a special general meeting as shall have been brought before the meeting pursuant to the Company’s notice of meeting (or any supplement thereto) delivered pursuant to Bye-law 72. At any time that Shareholders are not prohibited from filling vacancies or newly created directorships on the Board, nominations of persons for election to the Board may be made at a special general meeting at which directors are to be elected pursuant to the Company’s notice of meeting only:
(a) | by or at the direction of the Board (or any duly authorised committee thereof) or at the direction of the Court pursuant to the Companies Act; |
(b) | by any Shareholder who submitted a valid requisition request for the applicable special general meeting in accordance with Bye-Law 70 and section 74 of the Companies Act and complies with the notice procedures set out in Bye-Law 111; or |
(c) | provided that the Board has determined that directors shall be elected at such special general meeting, by any Shareholder who: |
(i) is a Shareholder on the record date for the determination of Shareholders entitled to vote at such meeting, on the date of the giving of the notice referred to in Bye-law 111 and at the time of the meeting; and
(ii) complies with the notice procedures set out in Bye-law 111;
(3) Paragraphs (1)(c), 2(b) and (2)(c) of this Bye-law 110 shall be the exclusive means for a Shareholder to make nominations or submit other business before an annual general meeting or special general meeting (other than pursuant to Rule 14a-8 under the Exchange Act).
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111. (1) | For nominations or other business to be properly brought before an annual general meeting or special general meeting by a Shareholder pursuant to Bye-law 110, the Shareholder bringing the notice (the “Noticing Shareholder”) must have given timely notice thereof in proper written form in accordance with Bye-law 112, and, in the case of business other than nominations of persons for election to the Board, such other business must constitute a proper matter for Shareholder action. To be in proper written form, such Noticing Shareholder’s notice delivered pursuant to Bye-law 110 shall set forth: |
(a) | as to each person whom the Noticing Shareholder proposes to nominate for election or re-election as a director (i) the name, age, citizenship, business address and residence address of such person, (ii) a complete biography and statement of such person’s qualifications, including the principal occupation or employment of such person (at present and for the past five years), (iii) the Specified Information (as defined below) for such person and any member of the immediate family of such person, or any Affiliate or Associate of such person, or any person acting in concert therewith, as if such person were a Holder (as defined below), (iv) all information relating to such person that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to the Exchange Act or that is otherwise required pursuant to and in accordance with Section 14 of the Exchange Act,, and the rules and regulations promulgated thereunder (including such person’s written consent to being named in the Company’s proxy statement as a nominee of the Noticing Shareholder and to serving as a director if elected), (v) a complete and accurate description of agreements, arrangements and understandings (whether written or oral), including, without limitation, all direct and indirect compensation and other material monetary agreements, arrangements and understandings at present and for the past three years, and any other material relationships, between or among each Holder and any Shareholder Associated Person of each such Holder, on the one hand, and each proposed nominee and any member of the immediate family of such proposed nominee, and his or her respective Affiliates and Associates, or others acting in concert therewith, on the other hand, including, without limitation, all biographical and related party transaction and other information that would be required to be disclosed pursuant to the US federal and state securities laws, including Rule 404 promulgated under Regulation S-K under the Securities Act (or any successor provision), if any Holder and any Shareholder Associated Person were the “registrant” for purposes of such rule and the nominee were a director or executive officer of such registrant, and (vi) a completed and signed questionnaire, representation and agreement and any and all other information required by paragraph (7) of this Bye-law 111; |
(b) | as to any other business that the Noticing Shareholder proposes to bring before the meeting, (i) a brief description of the business desired to be brought before the meeting, (ii) the reasons for conducting such business at the meeting, (iii) a description of all agreements, arrangements and understandings between each Holder and any Shareholder Associated Person of each such Holder and any other person or persons (including their names) in connection with the proposal of such business by the Noticing Shareholder, (iv) the text of the proposal or business (including the text of any resolutions proposed for consideration and, in the event that such business includes a proposal to amend these Bye-laws, the specific language of the proposed amendment), (v) the reasons for conducting such business at the meeting and (vi) any material interest in such business of each Holder r and any Shareholder Associated Person of each such Holder, if any; |
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(c) | as to the Noticing Shareholder and the beneficial owner, if any, on whose behalf the nomination is made or the other business is being proposed (collectively with the Noticing Shareholder, the “Holders” and each, a “Holder”): |
(i) | the full name and address of each Holder and the name and address of any Shareholder Associated Person of each such Holder; |
(ii) | as of the date of the notice (which information, for the avoidance of doubt, shall be updated and supplemented pursuant to paragraph (2) of Bye-law 111): (A) the class or series and number of shares of the Company which are, directly or indirectly, held of record or owned beneficially by each Holder and any Shareholder Associated Person of each such Holder (provided, however, that for purposes of this paragraph (1)(c) of Bye-law 111, any such person shall in all events be deemed to beneficially own any shares of the Company as to which such person has a right to acquire beneficial ownership of at any time in the future, whether such right is exercisable immediately or only after the passage of time or the fulfilment of a condition or both), (B) any Derivative Instrument directly or indirectly owned or held, including beneficially, by each such Holder and any Shareholder Associated Person of each such Holder presently or within the last 12 months in any shares or other securities of the Company, (C) a description of any proxy, contract, arrangement, understanding or relationship pursuant to which each Holder and any Shareholder Associated Person of each such Holder has a right to vote or has granted a right to vote any shares of any security of the Company, (D) any Short Interest held by each Holder and any Shareholder Associated Person of each such Holder presently or within the last 12 months in any shares or other securities of the Company, (E) any agreement, arrangement or understanding (including any contract to purchase or sell, acquisition or grant of any option, right or warrant to purchase or sell, swap or other instrument) between and among each Holder, any Shareholder Associated Person of each such Holder, on the one hand, and any person acting in concert with any such person, on the other hand, with the intent or effect of which may be to transfer to or from any such person, in whole or in part, any of the economic consequences of ownership of any security of the Company or to increase or decrease the voting power of any such person with respect to any security of the Company, (F) any direct or indirect legal, economic or financial interest (including Short Interest) of each Holder and any Shareholder Associated Person of each such Holder in the outcome of any vote to be taken (x) at any annual general meeting or special general meeting of Shareholders or (y) any other entity with respect to any matter that is related, directly or indirectly, to any nomination or business proposed by any Holder under these Bye-laws, (G) a description of any agreement, arrangement or understanding with respect to any rights to dividends on the shares of the Company owned beneficially by each Holder or any Shareholder Associated Person of each such Holder that are separated or separable pursuant to such agreement, arrangement or understanding from the underlying shares of the Company, (H) any proportionate interest in shares of the Company or Derivative Instruments held, directly or indirectly, by a general or limited partnership or limited liability company or similar entity in which any Holder and any Shareholder Associated Person of each such Holder is a general partner or, directly or indirectly, beneficially |
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owns any interest in a general partner or is the manager or managing member or, directly or indirectly, beneficially owns any interest in the manager or managing member of a limited liability company or similar entity, (I) any direct or indirect legal, economic or financial interest (including Short Interest) in any principal competitor of the Company held by each Holder and any Shareholder Associated Person of each such Holder, (J) any performance-related fees (other than an asset-based fee) that each Holder and any Shareholder Associated Person of each such Holder is entitled to based on any increase or decrease in the value of shares of the Company or Derivative Instruments, if any, as of the date of such notice and (K) any material pending or threatened action, suit or proceeding (whether civil, criminal, investigative, administrative or otherwise) in which any Holder or any Shareholder Associated Person of each such Holder is, or is reasonably expected to be made, a party or material participant involving the Company or any of its officers, directors or employees, or any Affiliate of the Company, or any officer, director or employee of such Affiliate (sub-paragraphs (A) through (K) above of this Bye-law 111(1)(c) shall be referred, collectively, as the “Specified Information”); |
(iii) | a representation by the Noticing Shareholder that such shareholder is a holder of record of shares of the Company entitled to vote at such meeting on the matter proposed, will continue to be a shareholder of record of the Company entitled to vote at such meeting on the matter proposed through the date of such meeting and intends to appear in person or by proxy at the meeting to propose such nomination or other business; |
(iv) | a representation whether any Holder and/or any Shareholder Associated Person of each such Holder intends or is part of a group which intends (A) to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the Company’s issued share capital required to elect the proposed nominee or approve or adopt the other business being proposed and/or (B) otherwise to solicit proxies from Shareholders in support of such nomination or other business; |
(v) | a certification by the Noticing Shareholder that each Holder and any Shareholder Associated Person of each such Holder has complied with all applicable US federal, state and other legal requirements in connection with its acquisition of shares or other securities of the Company and/or such person’s acts or omissions as a shareholder of the Company; |
(vi) | the names and addresses of other shareholders (including beneficial owners) known by any Holder or Shareholder Associated Person of each such Holder to provide financial or otherwise material support for such proposal or nomination or nominations, and to the extent known the class and number of all shares of the Company’s capital stock owned beneficially or of record by such other shareholder(s) or other beneficial owner(s) (it being understood that delivery of a revocable proxy with respect to such proposal or nomination shall not in itself require disclosure under this subclause (vi)), |
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(vii) | the information and statement required by Rule 14a-19(b) of the Exchange Act (or any successor provision); |
(viii) | all information that would be required to be set forth in a Schedule 13D filed pursuant to Rule 13d-1(a) or an amendment pursuant to Rule 13d-2(a) if such a statement were required to be filed under the Exchange Act and the rules and regulations promulgated thereunder by each Holder and each Shareholder Associated Person, if any, of each such Holder; |
(ix) | any other information relating to each Holder and each Shareholder Associated Person, if any, of such Holder that would be required to be disclosed in a proxy statement and form of proxy or other filings required to be made in connection with solicitations of proxies for, as applicable, the proposal and/or for the election of directors in a contested election pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder; and |
(x) | a representation by the Noticing Shareholder as to the accuracy of the information set forth in the notice; |
(d) | a description of any agreement, arrangement or understanding with respect to the nomination or proposal and/or the voting of shares of any class or series of shares of the Company between or among the Holders and any Shareholder Associated Person of each such Holder, on whose behalf the nomination or proposal is made, any of their respective affiliates or associates and/or any others acting in concert with any of the foregoing; and |
(2) | Any Noticing Shareholder who submits a notice pursuant to Bye-law 110 is required to update and supplement the information disclosed in such notice in accordance with the provisions of this paragraph. To be considered timely, a Noticing Shareholder’s notice shall further be updated and supplemented from time to time to the extent necessary so that the information provided or required to be provided in such notice shall be true and correct (x) as of the record date for determining the Shareholders entitled to notice of the meeting and (y) as of the date that is ten days prior to the meeting or any adjournment, recess, rescheduling or postponement thereof ; provided that if the record date for determining the Shareholders entitled to vote at the meeting is less than ten days prior to the meeting or any adjournment, recess, rescheduling or postponement thereof, the information shall be supplemented and updated as of such later date. Any such update and supplement shall be delivered in writing to the Secretary at the principal executive offices of the Company and electronically at corporatesecretary@kestramedical.com (or such other address as may be specified by the Board from time to time) not later than five days after the record date for determining the Shareholders entitled to notice of the meeting (in the case of any update and supplement required to be made as of the record date for determining the Shareholders entitled to notice of the meeting), not later than eight days prior to the date for the meeting or any adjournment, recess, rescheduling or postponement thereof (in the case of any update or supplement required to be made as of ten days prior to the meeting or adjournment or postponement thereof) and not later than five days after the record date for determining the Shareholders entitled to vote at the meeting, but no later than the day prior to the meeting or any adjournment, recess, rescheduling or postponement thereof (in the case of any update and supplement required to be made as of a date less than five days prior the date of the meeting or any adjournment or postponement thereof). In addition, if the Noticing Shareholder has delivered to the Company a notice relating to the |
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nomination of directors, the Noticing Shareholder shall deliver to the Company not later than eight days prior to the date of the meeting or any adjournment, recess, rescheduling or postponement thereof (or, if not practicable, on the first practicable date prior to the date to which the annual meeting has been adjourned or postponed) reasonable evidence that it has complied with the requirements of Rule 14a-19 of the Exchange Act (or any successor provision). For the avoidance of doubt, the obligation to update and supplement set forth in this paragraph or any other Section of these Bye-laws shall not limit the Company’s rights with respect to any deficiencies in any notice provided by a Shareholder, extend any applicable deadlines hereunder or enable or be deemed to permit a Shareholder who has previously submitted notice hereunder to amend or update any proposal or to submit any new proposal, including by changing or adding nominees, matters, business and/or resolutions proposed to be brought before a meeting of the Shareholders. |
(3) | The Company may also, as a condition to any such nomination or business being deemed properly brought before an annual general meeting or special general meeting, require any Holder or any proposed nominee to deliver to the Secretary, within five Business Days of any such request, such other information as may reasonably be requested by the Company, including such other information as may be reasonably required by the Board, in its sole discretion, to determine (1) the eligibility of such proposed nominee to serve as a director of the Company, (2) whether such nominee qualifies as an “independent director” or “audit committee financial expert” under applicable law, securities exchange rule or regulation, or any publicly disclosed corporate governance guidelines or committee charter of the Company and (3) such other information that the Board determines, in its sole discretion, could be material to a reasonable Shareholder’s understanding of the independence, or lack thereof, of such proposed nominee. |
(4) | Except for directors who are appointed by the Board pursuant to these Bye-laws, only such persons who are nominated in accordance and compliance with the procedures set forth in Bye-laws 110-117 (inclusive) shall be eligible for election to serve as directors at a meeting of Shareholders and only such other business shall be conducted at a meeting of Shareholders as shall have been brought before the meeting in accordance with the procedures set forth in Bye-laws 110-117 (inclusive). Except as otherwise provided by law or these Bye-laws, the Board or a duly authorized committee thereof (in advance of the meeting) or chair of the meeting (during the meeting) shall, in addition to making any other determination that may be appropriate for the conduct of the meeting of the Board, have the power and duty to determine whether a nomination or any other business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in these Bye-laws (including whether the Noticing Shareholder or other Holder, if any, on whose behalf the nomination is made or other business is being proposed solicited (or is part of a group which solicited) or did not so solicit, as the case may be, proxies in support of such Noticing Shareholder’s nominee or other business in compliance with such Shareholder’s’ representation as required by paragraph(iv) of Bye-law 111(1)(c)). If any proposed nomination or other business was not made or proposed in compliance with these Bye-laws, the chair of the meeting shall have the power and duty to declare to the meeting that any such nomination or other business was not properly brought before the meeting and in accordance with the provisions of these Bye-laws, and that such nomination or other business not properly brought before the meeting shall be disregarded and/or shall not be transacted. Notwithstanding anything contained herein, unless otherwise required by the Companies Act, if the Shareholder (or a qualified representative of the Shareholder) does not appear at the annual general meeting or special general meeting to present a nomination or business, such nomination shall be disregarded and |
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such proposed business shall not be transacted, notwithstanding that proxies in respect of such vote may have been received by the Company. For purposes of this Bye-law 111, to be considered a qualified representative of the Shareholder, a person must be a duly authorized officer, manager or partner of such Shareholder or must be authorized by a writing executed by such Shareholder or an electronic transmission delivered by such Shareholder to act for such Shareholder as proxy at the meeting of Shareholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of Shareholders. |
(5) | Notwithstanding anything contained herein, a Shareholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations promulgated thereunder with respect to the matters set forth in this Bye-law 111; provided, however, that, any references in these Bye-laws to the Exchange Act or the rules and regulations promulgated thereunder are not intended to and shall not limit any requirements applicable to nominations or proposals as to any other business to be considered pursuant to these bye-laws (including clauses (1)(c), (2)(b) and 2(c) of Bye-law 110), and compliance with clauses (1)(c), (2)(b) or 2(c) of Bye-law 110 shall be the exclusive means for a Shareholder to make nominations or submit other business. Nothing in these Bye-laws shall be deemed to affect any rights of (i) the holders of any class or series of shares having a preference over the common shares as to dividends or upon liquidation to elect directors under specified circumstances; or (ii) Shareholders to request inclusion of proposals in the Company’s proxy statement pursuant to Rule 14a-8 under the Exchange Act or any other applicable federal or state securities law with respect to that Shareholder’s request to include proposals in the Company’s proxy statement. |
(7) | In addition to the other requirements of this Bye-law 111, each person who a Noticing Shareholder proposes to nominate for election or re-election as a director of the Company must deliver in writing (in accordance with the time periods prescribed for delivery of notice under Bye-law 112) to the Secretary (i) a written questionnaire with respect to the background and qualification of such person and the background of any other person or entity on whose behalf the nomination is being made (which questionnaire shall be provided by the Secretary upon written request of any Shareholder identified by name within five Business Days of such written request) and (ii) a written representation and agreement (in the form provided by the Secretary upon written request of any Shareholder identified by name within five Business Days of such request) that such person (A) is not and will not become a party to (1) any agreement, arrangement or understanding (whether written or oral) with, and has not given any commitment or assurance to, any person or entity as to how such person, if elected as a director of the Company, will act or vote on any issue or question (a “Voting Commitment”) that has not been disclosed to the Company or (2) any Voting Commitment that could limit or interfere with such person’s ability to comply, if elected as a director of the Company, with such person’s fiduciary duties under applicable law, (B) is not and will not become a party to any agreement, arrangement or understanding with any person or entity other than the Company with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as a director that has not been disclosed to the Company, (C) in such person’s individual capacity and on behalf of any person or entity on whose behalf the nomination is being made, would be in compliance, if elected as a director of the Company, and will comply with all applicable rules of the exchanges upon which the securities of the Company are listed and all applicable publicly disclosed corporate governance, conflict of interest, confidentiality and stock ownership and trading policies and guidelines of the Company and (D) in such person’s individual capacity and on behalf of any Holder on whose behalf the nomination is being made, intends to serve a full term if elected as a director of the Company. |
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112. | Any notice or other documents required to be given to the Secretary pursuant to Bye-law 111 must be in writing and delivered to or mailed and received by the Secretary at the principal executive offices of the Company and electronically at corporatesecretary@kestramedical.com (or such other address as may be specified by the Board from time to time), who must receive the notice not later than the following dates: |
(a) | in the case of an annual general meeting, not later than the close of business on the 90th day nor earlier than the close of business on the 120th day before the first anniversary of the preceding year’s annual general meeting (which anniversary date shall, for purposes of the Company’s first annual general meeting of Shareholders after its common shares are first publicly traded, be deemed to have occurred on September 15, 2025), or, if no annual general meeting was held in the previous year (excluding the Company’s first annual general meeting of Shareholders after its common shares are first publicly traded) or the date of the annual general meeting is advanced by more than 30 days, or delayed by more than 70 days from such anniversary date, such notice shall be delivered to the Secretary not earlier than the opening of business on the 120th day prior to such annual general meeting and not later than the close of business on the later of the 90th day prior to such annual general meeting or the tenth day following the day on which the public announcement (as defined below) of the date of such meeting is first made by the Company; and |
(b) | in the case of a special general meeting, not later than the close of business on the tenth day following the day on which public announcement is first made by the Company of the date of the special general meeting at which directors are to be elected. |
In no event shall an adjournment, recess, rescheduling or postponement (or the public announcement of adjournment, recess, rescheduling or postponement) of an annual general meeting or special general meeting commence a new time period (or extend any time period) for the giving of a notice as described above. Notwithstanding anything in these Bye-laws to the contrary, if the number of directors to be elected to the Board at an annual general meeting is increased, and there is no public announcement by the Company naming all of the nominees for director or specifying the size of the increased Board at least 10 days prior to last day a Noticing Shareholder may deliver a notice of nominations in accordance with Bye-law 112(a), then a notice required by Bye-law 111 shall be considered timely, but only with respect to nominees for any new positions created by such increase, if it is received by the Secretary not later than the close of business on the 10th day following the day on which a public announcement of such increase in the number of directors to be elected is first made by the Company. For the avoidance of doubt, a Shareholder shall not be entitled to make additional or substitute nominations following the expiration of the time periods set forth in these Bye-laws.
113. | The date and time of the opening and the closing of the polls for each matter upon which the Shareholders will vote at a meeting shall be announced at the meeting by the chair of the meeting. The Board may adopt by resolution such rules and regulations for the conduct of the meeting of Shareholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board, the chair of the meeting shall have the right and authority to convene and (for any or no reason) to recess and/or adjourn the meeting in accordance with Bye-law 98, and shall have the power to prescribe such rules, regulations and procedures and to do all such acts as, in the judgement of such chair, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board or prescribed by the chair of |
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the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) the determination of when the polls shall open and close for any given matter to be voted on at the meeting; (iii) rules and procedures for maintaining order at the meeting and the safety of those present; (iv) limitations on attendance at or participation in the meeting to Shareholders of the Company, their duly authorized and constituted proxies, or such other persons as the chair of the meeting shall determine; (v) restrictions on entry to the meeting after the time fixed for the commencement thereof; (vi) limitations on the time allotted to questions or comments by participants and on shareholder approvals; and (vii) restricting the use of cell phones, audio or video recording devices and similar devices at the meeting. The chair of the meeting’s rulings on procedural matters shall be final. |
114. | Notwithstanding the provisions of Bye-law 109, where the number of persons validly proposed for re-election or election as a Director is greater than the number of Directors to be elected, the persons receiving the most votes (up to the number of Directors to be elected) shall be elected as Directors, and an absolute majority of the votes cast shall not be a prerequisite to the election of such Directors. |
115. | At any general meeting the Shareholders may authorise the Board to fill any vacancy in their number left unfilled at a general meeting. |
NUMBER OF DIRECTORS
116. | Except as otherwise provided for or fixed pursuant to the provisions of Bye-law 5 in relation to the right of the holders of any series of preference shares to elect additional directors, the number of Directors shall be a minimum number of six and a maximum number of eleven, or such number in excess thereof as the Company may from time to time determine by resolution of the Board. |
117. | The Directors shall have the power by resolution of the Board, without the need of any Resolution approved by the Shareholders, to increase or decrease the size of the Board at any time and from time to time, subject to the minimum number set in accordance with Bye-law 116. |
TERM OF OFFICE OF DIRECTORS
118. | The Board (other than those directors elected by the holders of any series of preferred shares, voting separately as a series or together with one or more other such series, as the case may be) shall be divided into three classes, designated as Class I, Class II and Class III. Each class of Directors shall consist, as nearly as reasonably possible, of one-third of the total number of Directors. Notwithstanding the foregoing, immediately prior to the opening of the polls at the seventh annual general meeting of Shareholders after its common shares are first publicly traded (such meeting, the “Triggering Annual Meeting”), the Board shall cease to be divided into three classes and, subject to the rights granted to the holders of any series of preferred shares then issued, shall consist of a single class. At the Triggering Annual Meeting, and at each annual general meeting of Shareholders thereafter, all Directors elected by a vote of the Shareholders generally shall be elected to hold office for a one-year term expiring at the next annual general meeting of Shareholders, notwithstanding that any such Director may have been previously elected to a term extending beyond the Triggering Annual Meeting or any subsequent annual general meeting. |
119. | Each Class I Director shall (unless his or her office is vacated in accordance with these Bye-laws) initially serve until the conclusion of the first annual general meeting of the Shareholders held following the Listing (unless his or her office is vacated in accordance with these Bye-laws) and, prior to the Triggering Annual Meeting, shall subsequently (unless his or her office is vacated in accordance with these Bye-laws) serve for a term of three years concluding at the third annual |
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general meeting after the Class I Directors were last appointed or reappointed. Each Class II Director shall (unless his or her office is vacated in accordance with these Bye-laws) serve initially until the conclusion of the second annual general meeting of the Shareholders held following the Listing and, prior to the Triggering Annual Meeting, shall subsequently (unless his or her office is vacated in accordance with these Bye-laws) serve for a term of three-years concluding at the third annual general meeting after the Class II Directors were last appointed or reappointed. Each Class III Director shall (unless his or her office is vacated in accordance with these Bye-laws) serve initially until the conclusion of the third annual general meeting of the Shareholders held following the Listing and, prior to the Triggering Annual Meeting, shall subsequently (unless his or her office is vacated in accordance with these Bye-laws) serve for a terms of three years concluding at the third annual general meeting after the Class III Directors were last appointed or reappointed. At each annual general meeting of the Shareholders thereafter and prior to the Triggering Annual Meeting, the successors to the class of Directors whose term shall then expire shall be elected to hold office for a three-year term so that the term of office of one class of Directors shall expire each year. , Prior to the Triggering Annual Meeting, if the number of Directors is changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of Directors in each class as nearly equal as possible, and any additional Directors of any class elected to fill a vacancy resulting from an increase in such class shall hold office for a term that shall coincide with the remaining term of that class, but in no case will a decrease in the number of Directors shorten the term of any incumbent Director. For the avoidance of doubt, a decrease in the number of Directors effective upon the election of Directors at an annual general meeting shall not be deemed to shorten the term of any incumbent Director who is not re-elected at such annual general meeting. A Director shall hold office until the annual general meeting for the year in which his or her term expires or until his or her successor shall be duly elected and qualified, subject however, to prior death, resignation, retirement, disqualification or removal from office in accordance with these Bye-laws. Any director may resign at any time by notice given in writing or by electronic transmission to the Company. Such resignation shall take effect at the date of receipt of such notice by the Company or at such later effective date or upon the happening of an event or events as is therein specified. |
REMOVAL OF DIRECTORS
120. | Section 93 of the Companies Act shall not apply to the removal of Directors. Subject to the rights of the holders of any series of preferred shares, a Director may be removed by the Shareholders with or without cause with the affirmative vote of Shareholders holding at least a majority of the issued shares entitled to vote thereon; provided that, from and after the Trigger Event, a Director can be removed by the Shareholders only with cause by Special Resolution. Notice of any special general meeting shall be served on the Director concerned not less than 14 days before the meeting and she or he shall be provided the opportunity to be heard at such meeting; provided that nothing in these Bye-laws shall have effect to deprive any director of any compensation or damages which may be payable to her or him in respect of the termination of his appointment as a director or any other appointment with the Company. |
121. | If a Director is removed from the Board under Bye-law 120, the Shareholders may fill the vacancy at the meeting at which such Director is removed. In the absence of such election or appointment the Board may fill the vacancy. |
VACANCY IN THE OFFICE OF DIRECTOR
122. | The office of Director shall be vacated if the Director: |
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(a) | is removed from office pursuant to these Bye-laws or is prohibited from being a Director by law; |
(b) | is or becomes bankrupt or insolvent; |
(c) | is or becomes of unsound mind or a patient for any purpose of any statute or applicable law relating to mental health and the Board resolves that their office is vacated, or dies; or |
(d) | resigns their office by notice to the Company. |
123. | Any one or more vacancies on the Board not filled at any general meeting, and any new vacancy created by the Board as a result of increasing the size of the Board, in accordance with Bye-law 117, shall be deemed a vacancy for the purposes of these Bye-laws. Without prejudice to the power of the Company by Resolution in pursuance to any of the provisions of these Bye-laws to appoint any person to be a Director, the Board shall have power at any time and from time to time, subject to Bye-laws 118 and 124 to appoint any individual to be a Director so as to fill a vacancy. Prior to the Triggering Annual Meeting, a Director so appointed shall hold office for a term that shall coincide with the remaining term of its class of Directors in accordance with Bye-law 119. From and after the Triggering Annual Meeting, a Director so appointed shall hold office until the next election of Directors and until his or her successor shall be duly elected and qualified, subject however, to prior death, resignation, retirement, disqualification or removal from office in accordance with these Bye-laws. |
124. | Upon the office of Director being vacated in accordance with Bye-law 122, if a new Director is appointed to the Board he or she will be designated to fill the vacancy arising and shall for the purposes of these Bye-laws, prior to the Triggering Annual Meeting (subject to the rights granted to the holders of any series of preferred shares then issued), constitute a member of the class of Directors represented by the person that he replaces. |
DIRECTORS TO MANAGE BUSINESS
125. | The business of the Company shall be managed and conducted by the Board. In managing the business of the Company, the Board may exercise all such powers of the Company as are not, by the Companies Act or by these Bye-laws, required to be exercised by the Company in general meeting. |
POWERS OF THE BOARD OF DIRECTORS
126. | Without prejudice to the generality of Bye-law 125, the Board may: |
(a) | appoint, suspend or remove any manager, secretary, clerk, agent or employee of the Company and may fix their remuneration and determine their duties; |
(b) | exercise all the powers of the Company to borrow money and to mortgage or charge its undertaking, property and uncalled capital, or any part thereof, and may issue debentures, debenture stock and other securities whether outright or as security for any debt, liability or obligation of the Company or any third party; |
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(c) | appoint one or more Directors to the office of chief executive officer of the Company, who shall, subject to the control of the Board, supervise and administer all of the general business and affairs of the Company and the Board may entrust and confer upon the chief executive officer such additional powers and duties as the Board deems appropriate for the transaction or conduct of such business and affairs of the Company; |
(d) | by power of attorney, appoint any company, firm, person or body of persons, whether nominated directly or indirectly by the Board, to be an attorney of the Company for such purposes and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Board) and for such period and subject to such conditions as it may think fit and any such power of attorney may contain such provisions for the protection and convenience of persons dealing with any such attorney as the Board may think fit and may also authorise any such attorney to sub-delegate all or any of the powers, authorities and discretions so vested in the attorney; |
(e) | procure that the Company pays all expenses incurred in promoting and incorporating the Company; |
(f) | designate any lead independent director and designate one or more committees, such committee or committees to have such name or names as may be determined from time to time by resolution adopted by the Board, and each such committee to consist of one or more directors of the Company as may be determined from time to time by resolution adopted by the Board, which to the extent provided in said resolution or resolutions shall have and may exercise the powers of the Board as may be delegated to such committee in the management of the business and affairs of the Company; provided that the meetings and proceedings of any such committee shall be governed by the provisions of these Bye-laws regulating then meetings and proceedings of the Board, so far as the same are applicable and are not superseded by directions imposed by the Board or any committee charters as approved by the Board. A majority of all the members of any such committee may determine its action and fix the time and place of its meetings, unless the Board shall otherwise provide. The Board shall have power to change the members of any such committee at any time, to fill vacancies and to discharge any such committee, either with or without cause, at any time; |
(g) | delegate any of its powers (including the power to sub-delegate) to any person on such terms and in such manner as the Board may see fit; |
(h) | present any petition and make any application in connection with the liquidation or reorganisation of the Company; |
(i) | in connection with the issue of any share, pay such commission and brokerage as may be permitted by law; and |
(j) | authorise any company, firm, person or body of persons to act on behalf of the Company for any specific purpose and in connection therewith to execute any deed, agreement, document or instrument on behalf of the Company. |
REGISTER OF DIRECTORS AND OFFICERS
127. | The Secretary shall establish and maintain a Register of the Directors and Officers of the Company as required by the Companies Act. The Register of the Directors and Officers shall be open to inspection without charge at the Registered Office of the Company on every Business Day, subject to such reasonable restrictions as the Board may impose, so that not less than two hours in each Business Day be allowed for inspection. The Register of the Directors and Officers may, after notice has been given in accordance with the Companies Act, be closed for any time or times not exceeding in the whole thirty days in each year. |
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APPOINTMENT OF OFFICERS
128. | The Board may appoint such Officers (who may or may not be Directors) as the Board may determine. The chair of the Board shall be appointed by the Board from amongst the Directors. |
APPOINTMENT OF SECRETARY AND RESIDENT REPRESENTATIVE
129. | The Secretary and Resident Representative, if necessary, shall be appointed by the Board at such remuneration (if any) and upon such terms as it may think fit and any Secretary and Resident Representative so appointed may be removed by the Board. |
DUTIES OF OFFICERS
130. | The Officers shall have such powers and perform such duties in the management, business and affairs of the Company as may be delegated to them by the Board from time to time. |
DUTIES OF THE SECRETARY
131. | The duties of the Secretary shall be those prescribed by the Companies Act together with such other duties as shall from time to time be prescribed by the Board. |
REMUNERATION OF OFFICERS
132. | The Officers shall receive such remuneration as the Board or any authorised committee thereof may determine. |
REMUNERATION OF DIRECTORS
133. | The remuneration (if any) of the Directors shall be determined by the Board and shall be deemed to accrue from day to day. |
134. | The Directors may be paid all travel, hotel and other expenses properly incurred by them in attending and returning from the meetings of the Board, any committee appointed by the Board, general meetings of the Company or separate meetings of the holders of any class of shares or of debentures of the Company, or otherwise in connection with the business the Company or their duties as Directors generally. |
CONFLICTS OF INTEREST
135. | Subject to any rules and regulations of an Appointed Stock Exchange on which the shares are then listed or admitted to trading, any Director, or any Director’s firm, partner or any company with whom any Director is associated, may act in any capacity for, be employed by or render services to the Company and such Director or such Director’s firm, partner or company shall be entitled to remuneration as if such Director were not a Director. Nothing herein contained shall authorise a Director or Director’s firm, partner or company to act as Auditor to the Company. |
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136. | A Director who is directly or indirectly interested (an “Interested Director”) in a contract or proposed contract or arrangement with the Company shall declare the nature of such interest as required by the Companies Act; provided that no such declaration shall be required to be made by a Non-Employee Directors (as defined below) in respect of such Non-Employee Director being involved in any business opportunity which may be a corporate opportunity for the Non-Employee Director and the Company or any of its Affiliates, as described in Bye-law 139, subject to Bye-law 142. |
137. | Following a declaration being made pursuant to Bye-laws 136 or 138 or the Companies Act, the Interested Director shall not be disqualified from participating in the discussion or voting on the matter unless the chair of the meeting determines that such Interested Director shall be disqualified as such. In the event the chair of the meeting is the Interested Director making a declaration under Bye-laws 136 or 138, the determination as to whether or not he should be disqualified may be made by a majority of the votes cast by the Directors not having such interest. In addition, an Interested Director may, but shall not be required to, recuse himself from the discussion or voting on any particular matter because of possible conflict or for any other reason disclosed to the other Directors. Any Interested Director that is so disqualified or that elects to be recused shall nevertheless be counted toward a quorum for the meeting. In the event that one or more Interested Directors are disqualified or elect to be recused from voting on a matter, or one or more Directors are later found to have an interest or conflict that should have been declared, the matter shall be approved or stand approved if it is or was approved by a majority of the votes cast by the Directors that do not have any interest or conflict in the matter, even if less than a quorum. |
138. | Subject to the Companies Act and any further disclosure required thereby, a general notice to the Directors by a Director or officer declaring that he or she is a director or officer or has an interest in any business entity and is to be regarded as interested in any transaction or arrangement made with that business entity shall be sufficient declaration of interest in relation to any transaction or arrangement so made. |
CORPORATE OPPORTUNITY
139. | In recognition and anticipation that (i) certain directors, principals, members, officers, associated funds, employees and/or other representatives of the Principal Shareholder and its Affiliates may serve as directors, officers or agents of the Company, (ii) one or more of the Principal Shareholder and its Affiliates may now engage and may continue to engage in the same or similar activities or related lines of business as those in which the Company, directly or indirectly, may engage and/or other business activities that overlap with or compete with those in which the Company, directly or indirectly, may engage, and (iii) members of the Board who are not employees of the Company (the “Non-Employee Directors”) and their respective Affiliates may now engage and may continue to engage in the same or similar activities or related lines of business as those in which the Company, directly or indirectly, may engage and/or other business activities that overlap with or compete with those in which the Company, directly or indirectly, may engage, Bye-laws 139-145 (inclusive) are set forth to regulate and define the conduct of certain affairs of the Company with respect to certain classes or categories of business opportunities as they may involve the Principal Shareholder, the Non-Employee Directors or any of their respective Affiliates and the powers, rights, duties and liabilities of the Company and its directors, officers and shareholders in connection therewith. |
140. | None of (i) Principal Shareholder and its Affiliates or (ii) any Non-Employee Director or his or her Affiliates (the Persons (as defined below) identified in (i) and (ii) above being referred to, collectively, as “Identified Persons” and, individually, as an “Identified Person”) shall, to the Fullest Extent Permitted By Applicable Law, have any duty to refrain from directly or indirectly (1) engaging in the same or similar business activities or lines of business in which the Company or any of its Affiliates now engages or proposes to engage or (2) otherwise competing with the |
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Company or any of its Affiliates, and, to the Fullest Extent Permitted By Applicable Law, no Identified Person shall be liable to the Company or its shareholders or to any Affiliate of the Company for breach of any fiduciary duty solely by reason of the fact that such Identified Person engages in any such activities. To the Fullest Extent Permitted By Applicable Law, the Company hereby renounces any interest or expectancy in, or right to be offered an opportunity to participate in, any business opportunity which may be a corporate opportunity for an Identified Person and the Company or any of its Affiliates, except as provided in Bye-law 142. Subject to Bye-law 142, in the event that any Identified Person acquires knowledge of a potential transaction or other matter or business opportunity which may be a corporate opportunity for itself, herself or himself and the Company or any of its Affiliates, such Identified Person shall, to the fullest extent permitted by law, have no fiduciary duty or other duty (contractual or otherwise) to communicate, present or offer such transaction or other business opportunity to the Company or any of its Affiliates and, to the Fullest Extent Permitted By Applicable Law, shall not be liable to the Company or its shareholders or to any Affiliate of the Company for breach of any fiduciary duty or other duty (contractual or otherwise) as a shareholder, director or officer of the Company solely by reason of the fact that such Identified Person pursues or acquires such corporate opportunity for itself, herself or himself, offers or directs such corporate opportunity to another Person, or does not present such corporate opportunity to the Company or any of its Affiliates. |
141. | The Company and its Affiliates do not have any rights in and to the business ventures of any Identified Person, or the income or profits derived therefrom, and the Company agrees that each of the Identified Persons may do business with any potential or actual customer or supplier of the Company or may employ or otherwise engage any officer or employee of the Company. |
142. | Notwithstanding anything contained herein, the Company does not renounce its interest in any corporate opportunity offered to any Non-Employee Director if such opportunity is expressly offered to such person in writing solely in his or her capacity as a director of the Company, and the provisions of Bye-law 140 shall not apply to any such corporate opportunity. |
143. | Notwithstanding anything contained herein, a corporate opportunity shall not be deemed to be a potential corporate opportunity for the Company if it is a business opportunity that (i) the Company is neither financially or legally able, nor contractually permitted to undertake, (ii) from its nature, is not in the line of the Company’s business or is of no practical advantage to the Company or (iii) is one in which the Company has no interest or reasonable expectancy. |
144. | For purposes of Bye-laws 139-145, (i) “Affiliate” shall mean with respect to the Principal Shareholder (a) any Person that, directly or indirectly, is controlled by the Principal Shareholder, controls the Principal Shareholder or is under common control with the Principal Shareholder and shall include any principal, member, director, partner, shareholder, officer, employee or other representative of any of the foregoing (other than the Company and any entity that is controlled by the Company), (b) in respect of a Non-Employee Director, any Person that, directly or indirectly, is controlled by such Non-Employee Director (other than the Company and any entity that is controlled by the Company) and (c) in respect of the Company, any Person that, directly or indirectly, is controlled by the Company; (ii) “control” (including the terms “controlled by” and “under common control with”), with respect to the relationship between or among two or more Persons, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the affairs or management of a Person, whether through the ownership of voting securities, by contract or otherwise. |
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145. | To the Fullest Extent Permitted By Applicable Law, any Person purchasing or otherwise acquiring or holding any interest in shares of the Company shall be deemed to have notice of and to have consented to the provisions contained in Bye-laws 139-145 (inclusive). The alteration, amendment, addition to or repeal of these Bye-laws shall not eliminate or reduce the effect of Bye-laws 139-145 (inclusive) in respect of any business opportunity first identified or any other matter occurring, or any cause of action, suit or claim that, but for Bye-laws 141-147 (inclusive). |
would accrue or arise, prior to such alteration, amendment, addition, repeal or adoption.
INDEMNIFICATION AND EXCULPATION OF DIRECTORS AND OFFICERS
146. | To the Fullest Extent Permitted by Applicable Law, a Director or Officer of the Company shall not be liable to the Company or its Shareholders for breach of fiduciary duty as a Director or Officer. |
147. | (1) Each person who was or is made a party or is threatened to be made a party to or participant in, or otherwise becomes involved in, any Proceeding shall be indemnified by the Company to the Fullest Extent Permitted By Applicable Law against all Losses and Expenses actually and reasonably incurred by such person, or on such person’s behalf, in connection with such Proceeding or any claim, issue or matter therein. |
(2) To the extent that the Indemnitee is successful, on the merits or otherwise, in defence of any Proceeding, the Indemnitee shall be indemnified to the Fullest Extent Permitted By Applicable Law, against all Expenses actually and reasonably incurred by the Indemnitee or on the Indemnitee’s behalf in connection therewith. If the Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify the Indemnitee against all Expenses actually and reasonably incurred by the Indemnitee or on the Indemnitee’s behalf in connection with each successfully resolved claim, issue or matter. For purposes of this Bye-law 147(2) and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, on substantive or procedural grounds, shall be deemed to be a successful result as to such claim, issue or matter.
(3) The Company shall advance, to the Fullest Extent Permitted By Applicable Law, all Expenses incurred by or on behalf of the Indemnitee in connection with any Proceeding within thirty (30) days after the receipt by the Company of a statement or statements from the Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by the Indemnitee. The Indemnitee shall qualify for advances upon the execution and delivery to the Company of an Indemnification Agreement, which shall constitute an undertaking providing that the Indemnitee undertakes to repay the amounts advanced by the Company, if and only to the extent that it is ultimately determined that the Indemnitee is not entitled to be indemnified by the Company. Unless otherwise determined by the Board, no other form of undertaking shall be required other than the execution of an Indemnification Agreement. Any advances and undertakings to repay pursuant to the Indemnification Agreement shall be unsecured and interest free.
148. | (1) Persons who after the date of the adoption of these Bye-Laws become or remain Directors or Officers of the Company or who, while a Director or Officer of the Company, become or remain, at the request of the Company, a director, officer, partner, trustee, member, manager, employee, agent or fiduciary of any Enterprise, shall be conclusively presumed to have relied on the rights to indemnity, advancement of Expenses and other rights contained in Bye-law 147 in entering into or continuing such service. To the Fullest Extent Permitted By Applicable Law, the rights to indemnification and to the advancement of Expenses conferred in Bye-law 147 shall apply to claims made against an Indemnitee arising out of acts or omissions which occurred or occur both prior and subsequent to the adoption hereof. Any amendment or repeal of these Bye-laws that adversely affects any right of an Indemnitee or its successors shall be prospective only and shall not eliminate, reduce or otherwise adversely affect any such right or protection with respect to any Proceeding involving any action or omission that occurred or allegedly occurred prior to such amendment or repeal. |
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(2) Any person serving as a director, officer, partner, trustee, member, manager, employee, agent or fiduciary of any Enterprise, at least 50% of whose equity interests are owned, directly or indirectly, by the Company shall be conclusively presumed to be serving in such capacity at the request of the Company.
(3) Any references to the “Company” in Bye-law 147 shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation, amalgamation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers and employees or agents, so that any Indemnitee shall stand in the same position under Bye-law 149 with respect to the resulting or surviving corporation as they would have with respect to such constituent corporation if its separate existence had continued.
(4) Any reference to an officer of any other Enterprise in Bye-law 147 shall be deemed to refer exclusively to an officer appointed by the board of directors or equivalent governing body of such other entity pursuant to the certificate of incorporation and bye-laws or equivalent organizational documents of such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise. The fact that any person who is or was an employee of the Company or an employee of any other Enterprise, but not an officer thereof as described in the preceding sentence, has been given or has used the title of “Vice President” or any other title that could be construed to suggest or imply that such person is or may be such an officer of the Company or of such other Enterprise shall not result in such person being constituted as, or being deemed to be, such an officer of the Company or of such other Enterprise for purposes of Bye-law 147.
149. | Each Shareholder agrees to waive any claim or right of action such Shareholder might have, whether individually or by or in the right of the Company, against any Director or Officer on account of any action taken by such Director or Officer, or the failure of such Director or Officer to take any action in the performance of their duties with or for the Company or any subsidiary thereof; provided that such waiver shall not extend to any matter in respect of any fraud or dishonesty which may attach to such Director or Officer, nor shall such waiver extend to any claims of violations of the Securities Act or the Exchange Act, which waiver would be prohibited by Section 14 of the Securities Act and Section 29(a) of the Exchange Act. |
150. | (1) All rights to indemnification and advancement of Expenses under Bye-law 147 shall be deemed to be a contract between the Company and each Director or Officer of the Company who serves or served in such capacity at any time while this Bye-law is in effect. The rights to indemnification and to the advancement of Expenses conferred in Bye-law 147 shall not be exclusive of any other right which any person may have or hereafter acquire under these Bye-Laws or under any statute, agreement, vote of stockholders or disinterested directors or otherwise; provided that, if the Indemnitee and the Company are parties to an Indemnification Agreement, for so long as such Indemnification Agreement is in effect, the rights and obligations of the Company and the Indemnitee with respect to indemnification and the advancement of Expenses under such Indemnification Agreement shall supersede and replace the rights to indemnification and advancement provided to such Indemnitee under these Bylaws, and such Indemnitee shall have no rights of indemnification and to the advancement of expenses except as provided in such Indemnification Agreement, which are incorporated into these Bylaws by reference and made a part hereof. |
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(2) To the Fullest Extent Permitted By Applicable Law, if Bye-law 147 or any portion thereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify and advance Expenses to each person entitled to indemnification under Bye-law 147 as to all Expenses and Losses actually and reasonably incurred or suffered by such person and for which indemnification and advancement of Expenses is available to such person pursuant to Bye-law 147 to the fullest extent permitted by any applicable portion of Bye-law 147 that shall not have been invalidated. Any repeal or amendment of Bye-law 147 or, to the Fullest Extent Permitted By Applicable Law, repeal or modification of relevant provisions of the Companies Act or any other applicable laws shall not in any way eliminate, reduce or otherwise adversely affect any rights to indemnification and advancement of Expenses of such Director or Officer or the obligations of the Company arising hereunder with respect to any Proceeding arising out of, or relating to, any actions or omissions that occurred or alleged to have occurred prior to the final adoption of such repeal, amendment or modification.
151. | The Company may purchase and maintain insurance, at its expense, to protect itself and any person who is or was or has agreed to become a Director, Officer, employee or agent of the Company or is or was serving at the request of the Company as a director, officer, partner, trustee, member, manager, employee, agent or fiduciary of any other Enterprise against any Expenses or Losses asserted against them, whether or not the Company would have the power to indemnify such person against such Expenses or Losses under the Companies Act. |
BOARD MEETINGS
152. | The Board may meet for the transaction of business, adjourn and otherwise regulate its meetings as it sees fit. A resolution put to the vote at a meeting of the Board shall be carried by the affirmative votes of a majority of the votes cast and in the case of an equality of votes the resolution shall fail. |
NOTICE OF BOARD MEETINGS
153. | A Director may, and the Secretary on the requisition of a Director shall, at any time summon a meeting of the Board. Notice of a meeting of the Board shall be deemed to be duly given to a Director if it is given to such Director orally (including in person or by telephone) or otherwise communicated or sent to such Director by post, electronic means or other mode of representing words in a visible form at such Director’s last known address or in accordance with any other instructions given by such Director to the Company for this purpose. |
ELECTRONIC PARTICIPATION IN MEETINGS
154. | Directors may participate in any meeting by such telephonic, electronic or other communication facilities or means that permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and participation in such a meeting shall constitute presence in person at such meeting. |
QUORUM AT BOARD MEETINGS
155. | The quorum necessary for the transaction of business at a meeting of the Board shall be a majority of the number of Directors then in office. |
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BOARD TO CONTINUE IN THE EVENT OF VACANCY
156. | The Board may act notwithstanding any vacancy in its number but, if and so long as its number is reduced below the number fixed by these Bye-laws as the quorum necessary for the transaction of business at meetings of the Board, the continuing Directors or Director may act for the purpose of (i) summoning a general meeting; or (ii) preserving the assets of the Company. |
CHAIR TO PRESIDE
157. | Unless otherwise agreed by a majority of the Directors attending, the chair, if there be one, shall act as chair at all meetings of the Board at which such person is present. In their absence a chair shall be appointed or elected by the Directors present at the meeting. |
WRITTEN RESOLUTIONS
158. | A resolution signed by all the Directors, which may be in counterparts, shall be as valid as if it had been passed at a meeting of the Board duly called and constituted, such resolution to be effective on the date on which the last Director signs the resolution. A copy of the resolution shall be filed with the minutes in accordance with Bye-law 160. |
VALIDITY OF PRIOR ACTS OF THE BOARD
159. | No regulation or alteration to these Bye-laws made by the Company in a general meeting shall invalidate any prior act of the Board which would have been valid if that regulation or alteration had not been made. |
MINUTES
160. | The Board shall cause minutes to be duly entered in books provided for the purpose: |
(a) | of all elections and appointments of Officers; |
(b) | of the names of the Directors present at each meeting of the Board and of any committee appointed by the Board; and |
(c) | of all resolutions and proceedings of general meetings of the Shareholders, meetings of the Board and meetings of committees appointed by the Board. |
PLACE WHERE CORPORATE RECORDS KEPT
161. | Minutes prepared in accordance with the Companies Act and these Bye-laws shall be kept by the Secretary at the Registered Office of the Company. |
FORM AND USE OF SEAL
162. | The Company may adopt a seal in such form as the Board may determine. The Board may adopt one or more duplicate seals for use in or outside Bermuda. |
163. | A seal may, but need not, be affixed to any deed, instrument, share certificate or document, and if the seal is to be affixed thereto, it shall be attested by the signature of (i) any Director, (ii) any Officer, (iii) the Secretary or (iv) any person authorised by the Board for that purpose. |
164. | A Resident Representative may, but need not, affix the seal of the Company to certify the authenticity of any copies of documents. |
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BOOKS OF ACCOUNT
165. | The Board shall cause to be kept proper records of account with respect to all transactions of the Company and in particular with respect to: |
(a) | all amounts of money received and expended by the Company and the matters in respect of which the receipt and expenditure relates; |
(b) | all sales and purchases of goods by the Company; and |
(c) | all assets and liabilities of the Company. |
166. | Such records of account shall be kept at the Registered Office of the Company, or subject to the Companies Act, at such other place as the Board thinks fit and shall be available for inspection by the Directors during normal business hours. |
FINANCIAL YEAR END
167. | The financial year end of the Company may be determined by resolution of the Board and failing such resolution shall be 30 April in each year. |
ANNUAL AUDIT
168. | Subject to any rights to waive laying of accounts or appointment of an Auditor pursuant to the Companies Act, the accounts of the Company shall be audited at least once in every year. |
APPOINTMENT OF AUDITOR
169. | Subject to the Companies Act, at the annual general meeting or at a subsequent special general meeting in each year, an Auditor shall be appointed by the Shareholders to audit the accounts of the Company. |
170. | The Auditor may be a Shareholder but no Director, Officer or employee of the Company shall, during their continuance in office, be eligible to act as an Auditor of the Company. |
REMUNERATION OF AUDITOR
171. | Save in the case of an Auditor appointed pursuant to Bye-law 178, the remuneration of the Auditor shall be fixed by the Company in a general meeting or in such manner as the Shareholders may determine. In the case of an Auditor appointed pursuant to Bye-law 178, the remuneration of the Auditor shall be fixed by the Board. |
DUTIES OF AUDITOR
172. | The financial statements provided for by these Bye-laws shall be audited by the Auditor in accordance with generally accepted auditing standards. The Auditor shall make a written report thereon in accordance with generally accepted auditing standards. |
173. | The generally accepted auditing standards referred to in this Bye-law may be U.S. generally accepted accounting principles or those of a country or jurisdiction other than Bermuda or such other generally accepted auditing standards as may be provided for in the Companies Act. If so, the financial statements and the report of the Auditor shall identify the generally accepted auditing standards used. |
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CHANGE TO THE COMPANY’S AUDITORS
174. | No change to the Company’s Auditors may be made save in accordance with the Companies Act. |
ACCESS TO RECORDS
175. | The Auditor shall at all reasonable times have access to all books kept by the Company and to all accounts and vouchers relating thereto, and the Auditor may call on the Directors or Officers of the Company for any information in their possession relating to the books or affairs of the Company. |
FINANCIAL STATEMENTS
176. | Subject to any rights to waive laying of accounts pursuant to the Companies Act, financial statements as required by the Companies Act shall be laid before the Shareholders in an annual general meeting. A resolution in writing made in accordance with Bye-law 100 receiving, accepting, adopting, approving or otherwise acknowledging financial statements shall be deemed to be the laying of such statements before the Shareholders in a general meeting. |
DISTRIBUTION OF AUDITOR’S REPORT
177. | The report of the Auditor shall be submitted to the Shareholders in an annual general meeting. |
VACANCY IN THE OFFICE OF AUDITOR
178. | The Board may fill any casual vacancy in the office of the Auditor. |
WINDING-UP
179. | If the Company shall be wound up the liquidator may, with the sanction of a Resolution, divide amongst the Shareholders in specie or in kind the whole or any part of the assets of the Company (whether they shall consist of property of the same kind or not) and may, for such purpose, set such value as he or she deems fair upon any property to be divided as aforesaid and may determine how such division shall be carried out as between the Shareholders or different classes of Shareholders. The liquidator may, with the like sanction, vest the whole or any part of such assets in the trustees upon such trusts for the benefit of the Shareholders as the liquidator shall think fit, but so that no Shareholder shall be compelled to accept any shares or other securities or assets whereon there is any liability. |
CHANGES TO BYE-LAWS
180. | No Bye-law may be rescinded, altered or amended and no new Bye-law may be made save in accordance with the Companies Act and until the same has been approved by a resolution of the Board and by a Resolution; provided that, from and after the Trigger Event, no Bye-law may be rescinded, altered or amended and no new Bye-law may be made save in accordance with the Companies Act and until the same has been approved by a resolution of the Board and by a Special Resolution. |
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CHANGES TO THE MEMORANDUM OF ASSOCIATION
181. | No alteration or amendment to the Memorandum of Association may be made save in accordance with the Companies Act and until same has been approved by a resolution of the Board and by a Resolution; provided that, from and after the Trigger Event, no alteration or amendment to the Memorandum of Association may be made save in accordance with the Companies Act and until same has been approved by a resolution of the Board and by a Special Resolution. |
EXCLUSIVE JURISDICTION
182. | In the event that any dispute arises out of or in connection with the Companies Act or out of or in connection with these Bye-laws, including any question regarding the existence, validity, application, enforceability or scope of any Bye-law and/or whether there has been any breach of the Companies Act or these Bye-laws, or any breach of a duty (including any fiduciary duty) by, or other wrongdoing by, a current or former Officer, Director, employee, agent or shareholder of the Company to the Company or its shareholders (whether or not such a claim is brought in the name of a Shareholder or in the name of the Company), any such dispute shall be subject to the exclusive jurisdiction of the Supreme Court of Bermuda, unless the Company (to the Fullest Extent Permitted By Applicable Law) selects or consents in writing to the selection of an alternative forum. Unless the Company consents in writing to the selection of an alternative forum, to the Fullest Extent Permitted By Applicable Law, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act against the Company or any director, officer, employee or agent of the Company. To the Fullest Extent Permitted By Applicable Law, any Person purchasing or otherwise acquiring or holding any interest in shares of the Company shall be deemed to have notice of and consented to the provisions of this Bye-law 182. |
MERGER AND AMALGAMATION
183. | The Company may merge or amalgamate in accordance with the Companies Act upon the approval by a resolution of the Board and by the approval of Shareholders holding at least a majority of the issued shares entitled to vote and present in person or by proxy at such meeting; provided that the quorum for such meeting must be two or more persons holding or representing at least a majority of the issued shares of the Company entitled to vote and present in person or by proxy at such meeting; provided, further, that if the Company shall at any time have only one Shareholder, one Shareholder present in person or by proxy shall form a quorum for such meeting. |
DISCONTINUANCE
184. | The Board may exercise all the powers of the Company to discontinue the Company to a jurisdiction outside Bermuda pursuant to the Companies Act. |
BUSINESS COMBINATIONS
185. | Notwithstanding anything contained in Bye-law 183, any Business Combination with any Interested Shareholder within a period of three years following the time of the transaction in which the person become an Interested Shareholder must be approved by the Board and authorised at an annual general meeting or special general meeting by the affirmative vote of Shareholders holding at least 66 2/3% of the issued shares entitled to vote thereon that are not owned by the Interested Shareholder unless: |
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(i) prior to the time that the person became an Interested Shareholder, the Board approved either the Business Combination or the transaction which resulted in the person becoming an Interested Shareholder; or
(ii) upon consummation of the transaction which resulted in the person becoming an Interested Shareholder, the Interested Shareholder owned at least 85% of the number of issued voting shares of the Company at the time the transaction commenced.
186. | The restrictions contained in Bye-law 185 shall not apply if: |
(i) a Shareholder becomes an Interested Shareholder inadvertently and (1) as soon as practicable divests itself of ownership of sufficient shares so that the Shareholder ceases to be an Interested Shareholder; and (2) would not, at any time within the three-year period immediately prior to a Business Combination between the Company and such Shareholder, have been an Interested Shareholder but for the inadvertent acquisition of ownership; or
(ii) the Business Combination is proposed prior to the consummation or abandonment of, and subsequent to the earlier of the public announcement or the notice required hereunder of, a proposed transaction which (1) constitutes one of the transactions described in the following sentence; (2) is with or by a person who either was not an Interested Shareholder during the previous three years or who became an Interested Shareholder with the approval of the Board; and (3) is approved or not opposed by a majority of the members of the Board then in office who were Directors prior to any person becoming an Interested Shareholder during the previous three years or were recommended for election or elected to succeed such Directors by resolution of the Board approved by a majority of such Directors. The proposed transactions referred to in the preceding sentence are limited to:
(a) a merger, amalgamation or consolidation of the Company (except an amalgamation in respect of which, pursuant to the Companies Act, no vote of the shareholders of the Company is required);
(b) a sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), whether as part of a dissolution or otherwise, of assets of the Company or of any entity directly or indirectly wholly-owned or majority-owned by the Company (other than to the Company or any entity directly or indirectly wholly-owned by the Company) having an aggregate market value equal to 50% or more of either the aggregate market value of all of the assets of the Company determined on a consolidated basis or the aggregate market value of all the issued shares of the Company; or
(c) a proposed tender or exchange offer for 50% or more of the issued voting shares of the Company.
The Company shall give not less than 20 days’ notice to all Interested Shareholders prior to the consummation of any of the transactions described in subparagraphs (a) or (b) of the second sentence of this paragraph (ii).
187. | For the purpose of Bye-laws 185 - 187 only, the term: |
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(i) “affiliate” means a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, another person; (ii) “associate”, when used to indicate a relationship with any person, means: (1) any company, partnership, unincorporated association or other entity of which such person is a director, officer or partner or is, directly or indirectly, the owner of 20% or more of any class of voting shares; (2) any trust or other estate in which such person has at least a 20% beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity; and (3) any relative or spouse of such person, or any relative of such spouse, who has the same residence as such person;
(iii) “Business Combination”, when used in reference to the Company and any Interested Shareholder of the Company, means:
(a) any merger, amalgamation or consolidation of the Company or any entity directly or indirectly wholly-owned or majority-owned by the Company, wherever incorporated, with (A) the Interested Shareholder or any of its affiliates, or (B) with any other company, partnership, unincorporated association or other entity if the merger, amalgamation or consolidation is caused by the Interested Shareholder;
(b) any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), except proportionately as a shareholder of the Company, to or with the Interested Shareholder, whether as part of a dissolution or otherwise, of assets of the Company or of any entity directly or indirectly wholly-owned or majority-owned by the Company which assets have an aggregate market value equal to 10% or more of either the aggregate market value of all the assets of the Company determined on a consolidated basis or the aggregate market value of all the issued shares of the Company;
(c) any transaction which results in the issuance or transfer by the Company or by any entity directly or indirectly wholly-owned or majority-owned by the Company of any shares of the Company, or any share of such entity, to the Interested Shareholder, except: (A) pursuant to the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible into shares of the Company, or shares of any such entity, which securities were issued prior to the time that the Interested Shareholder became such; (B) pursuant to a dividend or distribution paid or made, or the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible into shares of the Company, or shares of any such entity, which security is distributed, pro rata to all holders of a class or series of shares subsequent to the time the Interested Shareholder became such; (C) pursuant to an exchange offer by the Company to purchase shares made on the same terms to all holders of such shares; or (D) any issuance or transfer of shares by the Company; provided however, that in no case under items (B)-(D) of this subparagraph shall there be an increase in the Interested Shareholder’s proportionate share of any class or series of shares;
(d) any transaction involving the Company or any entity directly or indirectly wholly-owned or majority-owned by the Company which has the effect, directly or indirectly, of increasing the proportionate share of any class or series of shares, or securities convertible into any class or series of shares of the Company, or shares of any such entity, or securities convertible into such shares, which is owned by the Interested Shareholder, except as a result of immaterial changes due to fractional share adjustments or as a result of any repurchase or redemption of any shares not caused, directly or indirectly, by the Interested Shareholder; or
(e) any receipt by the Interested Shareholder of the benefit, directly or indirectly (except proportionately as a shareholder of the Company), of any loans, advances, guarantees or pledges (other than those expressly permitted in subparagraphs (A)-(D) of this paragraph) provided by or through the Company or any entity directly or indirectly wholly-owned or majority-owned by the Company; (iv) “control”, including the terms “controlling”, “controlled by” and “under common control with”, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting shares, by contract or otherwise.
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A person who is the owner of 20% or more of the issued and outstanding voting shares of any company, partnership, unincorporated association or other entity shall be presumed to have control of such entity, in the absence of proof by a preponderance of the evidence to the contrary; provided that notwithstanding the foregoing, such presumption of control shall not apply where such person holds voting shares, in good faith and not for the purpose of circumventing this provision, as an agent, bank, broker, nominee, custodian or trustee for one or more owners who do not individually or as a group have control of such entity;
(v) “Interested Shareholder” means any person (other than the Company and any entity directly or indirectly wholly-owned or majority owned by the Company) that (1) is the owner of 15% or more of the issued voting shares of the Company (other than the Principal Shareholder and its Affiliates), or (2) is an affiliate or associate of any person listed in (1) above; provided, however, that the term “Interested Shareholder” shall not include any person whose ownership of shares in excess of the 15% limitation set forth herein is the result of action taken solely by the Company unless such person referred to in this proviso acquires additional voting shares of the Company otherwise than as a result of further corporate action not caused, directly or indirectly, by such person. For the purpose of determining whether a person is an Interested Shareholder, the voting shares of the Company deemed to be issued shall include voting shares deemed to be owned by the person through application of paragraph (viii) below, but shall not include any other unissued shares which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise;
(vi) “person” means any individual, company, partnership, unincorporated association or other entity;
(vii) “voting shares” means, with respect to any company, shares of any class or series entitled to vote generally in the election of directors and, with respect to any entity that is not a company, any equity interest entitled to vote generally in the election of the governing body of such entity;
(viii) “owner”, including the terms “own” and “owned”, when used with respect to any shares, means a person that individually or with or through any of its affiliates or associates:
(a) beneficially owns such shares, directly or indirectly;
(b) has (A) the right to acquire such shares (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding, or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise; provided, however, that a person shall not be deemed the owner of shares tendered pursuant to a tender or exchange offer made by such person or any of such person’s affiliates or associates until such tendered shares are accepted for purchase or exchange; or (B) the right to vote such shares pursuant to any agreement, arrangement or understanding; provided, however, that a person shall not be deemed the owner of any shares because of such person’s right to vote such shares if the agreement, arrangement or understanding to vote such shares arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made to 10 or more persons; or
(c) has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent as described in item (B) of subparagraph (b) of this paragraph), or disposing of such shares with any other person that beneficially owns, or whose affiliates or associates beneficially own, directly or indirectly, such shares.
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Registration No. 56682
GOVERNEMENT
OF BERMUDA
Registrar of Companies
The Companies Act 1961
CERTIFICATE OF DEPOSIT OF
MEMORANDUM OF INCREASE OF SHARE CAPITAL
THIS IS TO CERTIFY that a Memorandum of Increase of Share Capital
at
Kestra medical Technologies Ltd
was delivered to the Registrar of Companies on the 26th day of
February 2025 in accodance with
section 45(3) of the Companies Act 1981 (the “Act”)
Kenneth Joaquin
Registrar of Companies
26th day of February 2025
Exhibit 3.2
Exhibit 10.1
THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AS SET FORTH IN SECTIONS 5.3 AND 5.4 BELOW, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY, SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION. THE SECURITIES ISSUABLE HEREUNDER ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE FOR A PERIOD OF 180 DAYS FOLLOWING MARCH 7, 2025 PURSUANT TO A LOCK-UP AGREEMENT EXECUTED BY THE HOLDER OF THIS WARRANT ON THE DATE OF ISSUANCE OF THIS WARRANT.
WARRANT TO PURCHASE SHARES
Company: |
Kestra Medical Technologies, Ltd., a limited company organized under the laws of Bermuda (the “Company”) | |
Number of Shares: |
62,325 Common Shares (the “Shares”) | |
Type/Series of Shares: |
Common Shares, par value $1.00 per share, of the Company (the “Common Shares”) | |
Warrant Price: |
$17.81 per Common Share | |
Issue Date: |
March 7, 2025 | |
Expiration Date: |
December 28, 2030 (See also Section 5.1(b)) |
THIS WARRANT TO PURCHASE SHARES (THIS “WARRANT”) CERTIFIES THAT, for good and valuable consideration, Kennedy Lewis Capital Partners Master Fund II LP, a Cayman Islands limited partnership, an affiliate of Kennedy Lewis Management LP, a Delaware limited partnership, with an office located at 80 Broad Street, 22nd Floor, New York, New York, 10004, United States, Attention: [***], email: [***] (together with any successor or permitted assignee or transferee of this Warrant or of any Shares issued upon exercise hereof, “Holder”) is entitled to purchase the Shares at the above-stated Warrant Price, all as set forth above and as adjusted pursuant to Section 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant.
Reference is made to that certain Warrant to Purchase Units, issued on December 20, 2020, by West Affum Holdings, L.P., an exempted limited partnership registered in the Cayman Islands (“Holdings”) to Holder (as amended, restated or otherwise modified from time to time, the “Prior Warrant”). The parties hereto, on behalf of themselves and each of their affiliates, hereby acknowledge and agree that this Warrant hereby replaces and supersedes the Prior Warrant in its entirety, the Prior Warrant is hereby terminated in full, and no Person shall have any further rights or obligations pursuant to or in connection with the Prior Warrant without any further action by any Person (this sentence, the “Prior Warrant Termination”).
SECTION 1 EXERCISE.
1.1 Method of Exercise. Holder may at any time and from time to time exercise this Warrant, in whole or in part, by delivering to the Company the original of this Warrant together with (i) a duly executed Notice of Exercise in substantially the form attached hereto as Appendix 1 and, unless Holder is exercising this Warrant pursuant to a cashless exercise as set forth in Section 1.2, wire transfer of same-day funds (to an account designated by the Company), or other form of payment acceptable to the Company, for the aggregate Warrant Price for the Shares being purchased and (ii) any documentation required by Computershare Trust Company, National Association or any successor transfer agent of the Company (the “Transfer Agent”).
1.2 Cashless Exercise. In lieu of payment of the Warrant Price in the manner as specified in Section 1.1 above, but otherwise in accordance with the requirements of Section 1.1, Holder may elect to surrender in payment of the aggregate Warrant Price for the Shares being purchased Shares equal in value to the aggregate Warrant Price for the Shares being purchased, in which event the Company shall instruct the Transfer Agent to issue to the Holder such number of Shares in book entry form and Holder shall irrevocably surrender for no value the number of Shares subject to the Warrant as are computed using the following formula:
X = Y(A-B)/A
where:
X = the number of Shares to be issued to the Holder;
Y = the number of Shares with respect to which this Warrant is being exercised (inclusive of the Shares subject to the Warrant surrendered to the Company in payment of the aggregate Warrant Price);
A = the Fair Market Value;
B = the Warrant Price; and
Y-X = the number of Shares subject to the Warrant to be irrevocably surrendered for no value by the Holder in exchange for X number of Shares.
1.3 Fair Market Value. For the purpose of this Warrant, “Fair Market Value” shall mean, for any date: (a) if Common Shares are then listed or quoted on the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, OTCQB or OTCQX (or any successors to any of the foregoing) (each, a “Trading Market”), the daily volume weighted average price of a Common Share for the trading day preceding such date on the Trading Market on which the Common Shares are then listed or quoted as reported by Bloomberg L.P., or (b) if the Common Shares are not then listed or quoted for trading on a Trading Market, the fair market value of a Common Share as determined by the board of directors (or equivalent governing body) of the Company (the “Board”) in its reasonable good faith judgment using all factors, information and data deemed by it to be pertinent.
1.4 Delivery of Shares and New Warrant. Promptly after Holder exercises this Warrant in the manner set forth in Section 1.1 or 1.2 above, the Company shall:
(a) instruct the Transfer Agent to issue the applicable Shares to Holder in book entry form; and
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(b) if this Warrant has not been fully exercised and has not expired, a new warrant of like tenor representing the Shares not so acquired.
1.5 Replacement of Warrant. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form, substance and amount to the Company or, in the case of mutilation, on surrender of this Warrant to the Company for cancellation, the Company shall, within a reasonable time, execute and deliver to Holder, in lieu of this Warrant, a new warrant of like tenor and amount.
1.6 Treatment of Warrant Upon Acquisition of Company.
(a) Acquisition. For the purpose of this Warrant, “Acquisition” means (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another person (other than a transaction where the surviving entity has substantially the same shareholders (with substantially the same proportionate shareholdings) as the Company immediately before such transaction), (ii) the Company, directly or indirectly, effects any sale, lease, exclusive license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another person) is completed pursuant to which holders of Common Shares are permitted to sell, tender or exchange their Common Shares for other securities, cash or property and such offer has been accepted by the holders of 50% or more of the outstanding Common Shares, or (iv) the Company, directly or indirectly, in one or more related transactions consummates a share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger, amalgamation or scheme of arrangement) with another person or group of persons whereby such other person or group acquires more than 50% of the outstanding Common Shares.
(b) Treatment of Warrant at Acquisition. In the event of an Acquisition in which the consideration to be received by the Company’s equityholders consists solely of cash, solely of Marketable Securities or a combination of cash and Marketable Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this Warrant pursuant to Section 1.1 and/or 1.2 and such exercise will be deemed effective immediately prior to and contingent upon the consummation of such Acquisition (or upon the Holder’s written election to the Company, the Company shall cause this Warrant to be exchanged for the consideration that the Holder would have received in such Acquisition if the Holder had chosen to exercise its right to have the Shares issued pursuant to Section 1.2 without actually exercising such right, acquiring such Shares and exchanging such Shares for such consideration in such Acquisition) or (ii) if Holder elects not to exercise the Warrant (or exchange the Warrant for the consideration that the Holder would have received in such Acquisition), this Warrant will expire immediately prior to the consummation of such Acquisition.
(c) The Company shall provide Holder with written notice of the Cash/Public Acquisition (together with such reasonable information as Holder may reasonably require regarding the treatment of this Warrant in connection with such contemplated Cash/Public Acquisition giving rise to such notice), which is to be delivered to Holder not less than seven (7) Business Days prior to the closing of the proposed Cash/Public Acquisition. Notwithstanding the foregoing, if, immediately prior to the consummation of the Cash/Public Acquisition, the Fair Market Value would be greater than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised, and the Company shall promptly notify the Holder of the number of Shares (or such other securities) issued upon such exercise to the Holder.
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(d) Upon the closing of any Acquisition other than a Cash/Public Acquisition defined above, the acquiring, surviving or successor entity shall assume the obligations of this Warrant, and this Warrant shall thereafter be exercisable for the same securities and/or other property as would have been paid for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on and as of the closing of such Acquisition, subject to further adjustment from time to time in accordance with the provisions of this Warrant.
1.7 As used in this Warrant, “Marketable Securities” means securities meeting all of the following requirements: (i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and is then current in its filing of all required reports and other information under the Securities Act of 1933, as amended (the “Act”) and the Exchange Act; (ii) the class and series of units or other security of the issuer that would be received by Holder in connection with the Acquisition were Holder to exercise this Warrant on or prior to the closing thereof is then traded in Trading Market; and (iii) Holder would be able to publicly re-sell, within six (6) months following the closing of such Acquisition, all of the issuer’s units and/or other securities that would be received by Holder in such Acquisition were Holder to exercise this Warrant in full on or prior to the closing of such Acquisition.
SECTION 2 ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.
2.1 Share Dividends, Splits, Etc. If the Company declares or pays a dividend or distribution on the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) payable in securities or property (other than cash), then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without additional cost to Holder, the total number and kind of securities and property which Holder would have received had Holder owned the Shares of record as of the date the dividend or distribution occurred. If the Company subdivides the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) by reclassification or otherwise into a greater number of shares, the number of Shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased. If the outstanding shares of the Class are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased.
2.2 Reclassification, Exchange, Combinations or Substitution. Upon any event other than an Acquisition whereby all of the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) are reclassified, exchanged, combined, substituted, or replaced for, into, with or by Company securities of a different class and/or series, then from and after the consummation of such event, this Warrant will be exercisable for the number, class and series of Company securities that Holder would have received had the Shares been outstanding on and as of the consummation of such event, and subject to further adjustment thereafter from time to time in accordance with the provisions of this Warrant. The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, combinations substitutions, replacements or other similar events.
2.3 No Fractional Share. No fractional Share shall be issuable upon exercise of this Warrant and the number of Shares to be issued shall be rounded down to the nearest whole Share. If a fractional Share interest arises upon any exercise of the Warrant, the Company shall eliminate such fractional Share interest by paying Holder in cash the amount computed by multiplying the fractional interest by (a) the Fair Market Value, less (b) the then-effective Warrant Price.
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2.4 Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant Price, the Company, at the Company’s expense, shall notify Holder in writing within a reasonable time setting forth the adjustments to the Warrant Price and facts upon which such adjustment is based. The Company shall, upon written request from Holder, furnish Holder with a certificate of its Chief Financial Officer, including computations of such adjustment.
SECTION 3 REPRESENTATIONS AND COVENANTS OF THE COMPANY.
3.1 Representations and Warranties. The Company represents and warrants to, and agrees with, the Holder that all Shares which may be issued upon the exercise of this Warrant, and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws. The Company covenants that it shall at all times cause to be reserved and kept available out of its authorized and unissued share capital such number of Shares as will be sufficient to permit the exercise in full of this Warrant.
3.2 Notice of Certain Events. If the Company proposes at any time to:
(a) declare any distribution upon the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable), whether in cash, property, units, or other securities and whether or not a regular cash distribution;
(b) offer for subscription or sale pro rata to the holders of the outstanding units of the Class any additional shares of any class or series of the Company’s shares (other than pursuant to contractual pre-emptive rights);
(c) effect any reclassification, exchange, combination, substitution, reorganization or recapitalization of the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable); or
(d) effect an Acquisition or to liquidate, dissolve or wind up;
then, in connection with each such event, the Company shall give Holder:
(1) at least five (5) Business Days prior written notice of the date on which a record will be taken for such distribution, or subscription rights (and specifying the date on which the holders of outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (a) and (b) above; and
(2) in the case of the matters referred to in (c) and (d) above at least five (5) Business Days prior written notice of the date when the same will take place (and specifying the date on which the holders of outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) will be entitled to exchange their units for the securities or other property deliverable upon the occurrence of such event).
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Reference is made to Section 1.6(c) whereby this Warrant will be deemed to be exercised pursuant to Section 1.2 hereof if the Company does not give written notice to Holder of a Cash/Public Acquisition as required by the terms hereof. Company will also provide information requested by Holder that is reasonably necessary to enable Holder to comply with Holder’s accounting or reporting requirements consistent with other investments of this type.
SECTION 4 REPRESENTATIONS AND WARRANTIES OF THE HOLDER.
The Holder represents and warrants to the Company as follows:
4.1 Purchase for Own Account. This Warrant and the securities to be acquired upon exercise of this Warrant by Holder are being acquired for investment for Holder’s account, not as a nominee or agent, and not with a view to the public resale or distribution within the meaning of the Act. Holder also represents that it has not been formed for the specific purpose of acquiring this Warrant or the Shares.
4.2 Disclosure of Information. Holder is aware of the Company’s business affairs and financial condition and has received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision with respect to the acquisition of this Warrant and its underlying securities. Holder further has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify any information furnished to Holder or to which Holder has access.
4.3 Investment Experience. Holder understands that the purchase of this Warrant and its underlying securities involves substantial risk. Holder has experience as an investor in securities of companies in the development stage and acknowledges that Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such knowledge and experience in financial or business matters that Holder is capable of evaluating the merits and risks of its investment in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and certain of its officers, directors or controlling persons of a nature and duration that enables Holder to be aware of the character, business acumen and financial circumstances of such persons.
4.4 Accredited Investor Status. Holder is an “accredited investor” within the meaning of Regulation D promulgated under the Act.
4.5 The Act. Holder understands that this Warrant and the Units issuable upon exercise hereof have not been registered under the Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Holder’s investment intent as expressed herein. Holder understands that this Warrant and the Shares issued upon any exercise hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are otherwise available. Holder is aware of the provisions of Rule 144 promulgated under the Act.
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4.6 No Voting Rights. Holder, as a Holder of this Warrant, will not have any voting or other rights as a shareholder of the Company until the exercise of this Warrant.
SECTION 5 MISCELLANEOUS.
5.1 Term and Automatic Conversion Upon Expiration.
(a) Term. Subject to the provisions of Section 1.6 above, this Warrant is exercisable in whole or in part at any time and from time to time on or before 6:00 P.M. Pacific time, on the Expiration Date and shall be void thereafter.
(b) Automatic Cashless Exercise upon Expiration. In the event that, on the Expiration Date, the Fair Market Value of one Share (or other security issuable upon the exercise hereof) is greater than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised, and the Company shall, within a reasonable time and if certificated, deliver a certificate representing the Shares (or such other securities) issued upon such exercise to Holder.
5.2 Legends. The Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form unless the Company has received an opinion of counsel acceptable to the Company stating that such Shares need not bear any such legend:
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER, SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION. THE SHARES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE FOR A PERIOD OF 180 DAYS FOLLOWING MARCH 7, 2025 PURSUANT TO A LOCK-UP AGREEMENT A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER.
5.3 Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this Warrant (or other shares of the Company’s capital stock into which this Warrant is then exercisable) may not be transferred or assigned in whole or in part except in compliance with applicable federal and state securities laws by the transferor and the transferee (including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as reasonably requested by the Company). The Company shall not require Holder to provide an opinion of counsel if the transfer is to any affiliate of Holder. Additionally, the Company shall also not require an opinion of counsel if there is no material question as to the availability of Rule 144 promulgated under the Act.
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5.4 Transfer Procedure. Without in any way limiting the provisions of Section 5.3, the Holder shall not Transfer, or agree or offer to Transfer, all or any part of any interest in this Warrant without the prior written consent of the Company, which consent may be withheld in the Company’s discretion, provided, however, in connection with any such transfer, Holder will give the Company notice of the portion of this Warrant being transferred with the name, address and taxpayer identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable); and provided further, that any subsequent transferee shall agree in writing with the Company to be bound by all of the terms and conditions of this Warrant. For purposes of this Warrant, “Transfer” means any sale, transfer, assignment, pledge, mortgage, exchange, hypothecation, grant of a security interest or other direct or indirect disposition or encumbrance of an interest (including by operation of law and whether with or without consideration) or the act thereof, but explicitly excluding the exercise of this Warrant issued hereunder in accordance with its terms.
5.5 Notices. All notices and other communications hereunder from the Company to the Holder, or vice versa, shall be deemed delivered and effective (i) when given personally, (ii) on the third (3rd) Business Day after being mailed by first-class registered or certified mail, postage prepaid, (iii) upon actual receipt if given by electronic mail and such receipt is confirmed in writing by the recipient, or (iv) on the first Business Day following delivery to a reliable overnight courier service, courier fee prepaid, in any case at such address as may have been furnished to the Company or Holder, as the case may be, in writing by the Company or such Holder from time to time in accordance with the provisions of this Section 5.5. All notices to Holder shall be addressed as follows until the Company receives notice of a change of address in connection with a transfer or otherwise:
Kennedy Lewis Capital Partners Master Fund II LP
c/o Kennedy Lewis Investment Management
80 Broad Street, 22nd Floor
New York, NY 10004, United States
Attention: [***]
Email: [***]
With a copy (which shall not constitute notice) to:
Latham & Watkins LLP
505 Montgomery Street
Suite 2000
San Francisco, CA 94111-6538
Attn: [***]
Email: [***]
Notice to the Company shall be addressed as follows until Holder receives notice of a change in address:
c/o West Affum Holdings, L.P.
3933 Lake Washington Blvd NE, Suite 200
Kirkland, Washington 98033
Attention: [***]
Email: [***]
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With a copy (which shall not constitute notice) to:
Kirkland & Ellis LLP
333 West Wolf Point Plaza
Chicago, Illinois 606054
Attention: [***]
Email: [***]
5.6 Waiver. This Warrant and any term hereof may be changed, waived, discharged or terminated (either generally or in a particular instance and either retroactively or prospectively) only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought.
5.7 Attorneys’ Fees. In the event of any dispute between the parties concerning the terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorneys’ fees.
5.8 Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed in counterparts, all of which together shall constitute one and the same agreement. Any signature page delivered electronically or by facsimile shall be binding to the same extent as an original signature page with regards to any agreement subject to the terms hereof or any amendment thereto. The words “execution,” “execute”, “signed,” “signature,” and words of like import in or related to any document to be signed in connection with this Warrant and the transactions contemplated hereby (including without limitation assignments, assumptions, amendments, waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by the Holder, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.
5.9 Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of New York without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of the substantive laws of any jurisdiction other than the State of New York.
5.10 Headings. The headings in this Warrant are for purposes of reference only and shall not limit or otherwise affect the meaning of any provision of this Warrant.
5.11 Business Days. “Business Day” is any day that is not a Saturday, Sunday or a day on which banks in New York, New York are closed.
5.12 United States Dollars. All dollar ($) amounts specified in this Warrant are United States dollar amounts.
[Signature page follows]
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IN WITNESS WHEREOF, the parties have caused this Warrant to Purchase Units to be executed by their duly authorized representatives effective as of the Issue Date written above.
“COMPANY”
KESTRA MEDICAL TECHNOLOGIES, LTD. | ||
By: | /s/ Brian Webster |
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Name: | Brian Webster | |
Title: | President and Chief Executive Officer | |
“HOLDER” | ||
KENNEDY LEWIS CAPITAL PARTNERS MASTER FUND II LP, a Cayman Islands limited partnership | ||
By: | /s/ Anthony Pasqua |
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Name: | Anthony Pasqua | |
Title: | Authorized Signatory |
[Signature Page to Warrant to Purchase Shares]
Accepted and agreed, solely for purposes of the Prior Warrant Termination, in its capacity as the Partnership (as defined in the Prior Warrant): | ||
“HOLDINGS” | ||
WEST AFFUM HOLDINGS, L.P., a Cayman Islands exempted limited partnership by its general partner WEST AFFUM GP LTD. a Cayman Islands exempted limited company. | ||
By: | /s/ Brian Webster | |
Name: | Brian Webster | |
Title: | Director |
[Signature Page to Warrant to Purchase Shares]
APPENDIX 1
NOTICE OF EXERCISE
1. The undersigned Holder hereby exercises its right purchase ___________ Common Shares, par value $1.00 per share, of Kestra Medical Technologies, Ltd., a limited company organized under the laws of Bermuda (the “Company”), in accordance with the attached Warrant To Purchase Shares, and tenders payment of the aggregate Warrant Price for such Common Shares as follows:
[ ] | Wire transfer of immediately available funds to the Company’s account |
[ ] | Cashless Exercise pursuant to Section 1.2 of the Warrant |
[ ] | Other [describe]__________________________ |
2. Please instruct the Transfer Agent to issue such Common Shares in the name(s) specified below.
Name(s): _________________________
3. By its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in SECTION 4 of the Warrant to Purchase Shares as of the date hereof.
HOLDER: | ||
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By: |
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Name: |
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Title: |
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(Date): |
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Appendix 1
Exhibit 10.2
THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AS SET FORTH IN SECTIONS 5.3 AND 5.4 BELOW, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY, SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION. THE SECURITIES ISSUABLE HEREUNDER ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE FOR A PERIOD OF 180 DAYS FOLLOWING MARCH 7, 2025 PURSUANT TO A LOCK-UP AGREEMENT EXECUTED BY THE HOLDER OF THIS WARRANT ON THE DATE OF ISSUANCE OF THIS WARRANT.
WARRANT TO PURCHASE SHARES
Company: | Kestra Medical Technologies, Ltd., a limited company organized under the laws of Bermuda (the “Company”) | |
Number of Shares: | 46,744 Common Shares (the “Shares”) | |
Type/Series of Shares: | Common Shares, par value $1.00 per share, of the Company (the “Common Shares”) | |
Warrant Price: | $20.65 per Common Share | |
Issue Date: | March 7, 2025 | |
Expiration Date: | March 7, 2032 (See also Section 5.1(b)) |
THIS WARRANT TO PURCHASE SHARES (THIS “WARRANT”) CERTIFIES THAT, for good and valuable consideration, Kennedy Lewis Capital Partners Master Fund II LP, a Cayman Islands limited partnership, an affiliate of Kennedy Lewis Management LP, a Delaware limited partnership, with an office located at 80 Broad Street, 22nd Floor, New York, New York, 10004, United States, Attention: [***], email: [***] (together with any successor or permitted assignee or transferee of this Warrant or of any Shares issued upon exercise hereof, “Holder”) is entitled to purchase the Shares at the above-stated Warrant Price, all as set forth above and as adjusted pursuant to Section 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant.
Reference is made to that certain Warrant to Purchase Units, issued on March 7, 2022, by West Affum Holdings, L.P., an exempted limited partnership registered in the Cayman Islands (“Holdings”) to Holder (as amended, restated or otherwise modified from time to time, the “Prior Warrant”). The parties hereto, on behalf of themselves and each of their affiliates, hereby acknowledge and agree that this Warrant hereby replaces and supersedes the Prior Warrant in its entirety, the Prior Warrant is hereby terminated in full, and no Person shall have any further rights or obligations pursuant to or in connection with the Prior Warrant without any further action by any Person (this sentence, the “Prior Warrant Termination”).
SECTION 1 EXERCISE.
1.1 Method of Exercise. Holder may at any time and from time to time exercise this Warrant, in whole or in part, by delivering to the Company the original of this Warrant together with (i) a duly executed Notice of Exercise in substantially the form attached hereto as Appendix 1 and, unless Holder is exercising this Warrant pursuant to a cashless exercise as set forth in Section 1.2, wire transfer of same-day funds (to an account designated by the Company), or other form of payment acceptable to the Company, for the aggregate Warrant Price for the Shares being purchased and (ii) any documentation required by Computershare Trust Company, National Association or any successor transfer agent of the Company (the “Transfer Agent”).
1.2 Cashless Exercise. In lieu of payment of the Warrant Price in the manner as specified in Section 1.1 above, but otherwise in accordance with the requirements of Section 1.1, Holder may elect to surrender in payment of the aggregate Warrant Price for the Shares being purchased Shares equal in value to the aggregate Warrant Price for the Shares being purchased, in which event the Company shall instruct the Transfer Agent to issue to the Holder such number of Shares in book entry form and Holder shall irrevocably surrender for no value the number of Shares subject to the Warrant as are computed using the following formula:
X = Y(A-B)/A
where:
X = the number of Shares to be issued to the Holder;
Y = the number of Shares with respect to which this Warrant is being exercised (inclusive of the Shares subject to the Warrant surrendered to the Company in payment of the aggregate Warrant Price);
A = the Fair Market Value;
B = the Warrant Price; and
Y-X = the number of Shares subject to the Warrant to be irrevocably surrendered for no value by the Holder in exchange for X number of Shares.
1.3 Fair Market Value. For the purpose of this Warrant, “Fair Market Value” shall mean, for any date: (a) if Common Shares are then listed or quoted on the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, OTCQB or OTCQX (or any successors to any of the foregoing) (each, a “Trading Market”), the daily volume weighted average price of a Common Share for the trading day preceding such date on the Trading Market on which the Common Shares are then listed or quoted as reported by Bloomberg L.P., or (b) if the Common Shares are not then listed or quoted for trading on a Trading Market, the fair market value of a Common Share as determined by the board of directors (or equivalent governing body) of the Company (the “Board”) in its reasonable good faith judgment using all factors, information and data deemed by it to be pertinent.
1.4 Delivery of Shares and New Warrant. Promptly after Holder exercises this Warrant in the manner set forth in Section 1.1 or 1.2 above, the Company shall:
(a) instruct the Transfer Agent to issue the applicable Shares to Holder in book entry form; and
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(b) if this Warrant has not been fully exercised and has not expired, a new warrant of like tenor representing the Shares not so acquired.
1.5 Replacement of Warrant. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form, substance and amount to the Company or, in the case of mutilation, on surrender of this Warrant to the Company for cancellation, the Company shall, within a reasonable time, execute and deliver to Holder, in lieu of this Warrant, a new warrant of like tenor and amount.
1.6 Treatment of Warrant Upon Acquisition of Company.
(a) Acquisition. For the purpose of this Warrant, “Acquisition” means (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another person (other than a transaction where the surviving entity has substantially the same shareholders (with substantially the same proportionate shareholdings) as the Company immediately before such transaction), (ii) the Company, directly or indirectly, effects any sale, lease, exclusive license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another person) is completed pursuant to which holders of Common Shares are permitted to sell, tender or exchange their Common Shares for other securities, cash or property and such offer has been accepted by the holders of 50% or more of the outstanding Common Shares, or (iv) the Company, directly or indirectly, in one or more related transactions consummates a share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger, amalgamation or scheme of arrangement) with another person or group of persons whereby such other person or group acquires more than 50% of the outstanding Common Shares.
(b) Treatment of Warrant at Acquisition. In the event of an Acquisition in which the consideration to be received by the Company’s equityholders consists solely of cash, solely of Marketable Securities or a combination of cash and Marketable Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this Warrant pursuant to Section 1.1 and/or 1.2 and such exercise will be deemed effective immediately prior to and contingent upon the consummation of such Acquisition (or upon the Holder’s written election to the Company, the Company shall cause this Warrant to be exchanged for the consideration that the Holder would have received in such Acquisition if the Holder had chosen to exercise its right to have the Shares issued pursuant to Section 1.2 without actually exercising such right, acquiring such Shares and exchanging such Shares for such consideration in such Acquisition) or (ii) if Holder elects not to exercise the Warrant (or exchange the Warrant for the consideration that the Holder would have received in such Acquisition), this Warrant will expire immediately prior to the consummation of such Acquisition.
(c) The Company shall provide Holder with written notice of the Cash/Public Acquisition (together with such reasonable information as Holder may reasonably require regarding the treatment of this Warrant in connection with such contemplated Cash/Public Acquisition giving rise to such notice), which is to be delivered to Holder not less than seven (7) Business Days prior to the closing of the proposed Cash/Public Acquisition. Notwithstanding the foregoing, if, immediately prior to the consummation of the Cash/Public Acquisition, the Fair Market Value would be greater than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised, and the Company shall promptly notify the Holder of the number of Shares (or such other securities) issued upon such exercise to the Holder.
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(d) Upon the closing of any Acquisition other than a Cash/Public Acquisition defined above, the acquiring, surviving or successor entity shall assume the obligations of this Warrant, and this Warrant shall thereafter be exercisable for the same securities and/or other property as would have been paid for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on and as of the closing of such Acquisition, subject to further adjustment from time to time in accordance with the provisions of this Warrant.
1.7 As used in this Warrant, “Marketable Securities” means securities meeting all of the following requirements: (i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and is then current in its filing of all required reports and other information under the Securities Act of 1933, as amended (the “Act”) and the Exchange Act; (ii) the class and series of units or other security of the issuer that would be received by Holder in connection with the Acquisition were Holder to exercise this Warrant on or prior to the closing thereof is then traded in Trading Market; and (iii) Holder would be able to publicly re-sell, within six (6) months following the closing of such Acquisition, all of the issuer’s units and/or other securities that would be received by Holder in such Acquisition were Holder to exercise this Warrant in full on or prior to the closing of such Acquisition.
SECTION 2 ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.
2.1 Share Dividends, Splits, Etc. If the Company declares or pays a dividend or distribution on the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) payable in securities or property (other than cash), then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without additional cost to Holder, the total number and kind of securities and property which Holder would have received had Holder owned the Shares of record as of the date the dividend or distribution occurred. If the Company subdivides the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) by reclassification or otherwise into a greater number of shares, the number of Shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased. If the outstanding shares of the Class are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased.
2.2 Reclassification, Exchange, Combinations or Substitution. Upon any event other than an Acquisition whereby all of the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) are reclassified, exchanged, combined, substituted, or replaced for, into, with or by Company securities of a different class and/or series, then from and after the consummation of such event, this Warrant will be exercisable for the number, class and series of Company securities that Holder would have received had the Shares been outstanding on and as of the consummation of such event, and subject to further adjustment thereafter from time to time in accordance with the provisions of this Warrant. The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, combinations substitutions, replacements or other similar events.
2.3 No Fractional Share. No fractional Share shall be issuable upon exercise of this Warrant and the number of Shares to be issued shall be rounded down to the nearest whole Share. If a fractional Share interest arises upon any exercise of the Warrant, the Company shall eliminate such fractional Share interest by paying Holder in cash the amount computed by multiplying the fractional interest by (a) the Fair Market Value, less (b) the then-effective Warrant Price.
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2.4 Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant Price, the Company, at the Company’s expense, shall notify Holder in writing within a reasonable time setting forth the adjustments to the Warrant Price and facts upon which such adjustment is based. The Company shall, upon written request from Holder, furnish Holder with a certificate of its Chief Financial Officer, including computations of such adjustment.
SECTION 3 REPRESENTATIONS AND COVENANTS OF THE COMPANY.
3.1 Representations and Warranties. The Company represents and warrants to, and agrees with, the Holder that all Shares which may be issued upon the exercise of this Warrant, and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws. The Company covenants that it shall at all times cause to be reserved and kept available out of its authorized and unissued share capital such number of Shares as will be sufficient to permit the exercise in full of this Warrant.
3.2 Notice of Certain Events. If the Company proposes at any time to:
(a) declare any distribution upon the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable), whether in cash, property, units, or other securities and whether or not a regular cash distribution;
(b) offer for subscription or sale pro rata to the holders of the outstanding units of the Class any additional shares of any class or series of the Company’s shares (other than pursuant to contractual pre-emptive rights);
(c) effect any reclassification, exchange, combination, substitution, reorganization or recapitalization of the outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable); or
(d) effect an Acquisition or to liquidate, dissolve or wind up;
then, in connection with each such event, the Company shall give Holder:
(1) at least five (5) Business Days prior written notice of the date on which a record will be taken for such distribution, or subscription rights (and specifying the date on which the holders of outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (a) and (b) above; and
(2) in the case of the matters referred to in (c) and (d) above at least five (5) Business Days prior written notice of the date when the same will take place (and specifying the date on which the holders of outstanding Common Shares (or other shares of the Company’s capital stock into which this Warrant is then exercisable) will be entitled to exchange their units for the securities or other property deliverable upon the occurrence of such event).
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Reference is made to Section 1.6(c) whereby this Warrant will be deemed to be exercised pursuant to Section 1.2 hereof if the Company does not give written notice to Holder of a Cash/Public Acquisition as required by the terms hereof. Company will also provide information requested by Holder that is reasonably necessary to enable Holder to comply with Holder’s accounting or reporting requirements consistent with other investments of this type.
SECTION 4 REPRESENTATIONS AND WARRANTIES OF THE HOLDER.
The Holder represents and warrants to the Company as follows:
4.1 Purchase for Own Account. This Warrant and the securities to be acquired upon exercise of this Warrant by Holder are being acquired for investment for Holder’s account, not as a nominee or agent, and not with a view to the public resale or distribution within the meaning of the Act. Holder also represents that it has not been formed for the specific purpose of acquiring this Warrant or the Shares.
4.2 Disclosure of Information. Holder is aware of the Company’s business affairs and financial condition and has received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision with respect to the acquisition of this Warrant and its underlying securities. Holder further has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify any information furnished to Holder or to which Holder has access.
4.3 Investment Experience. Holder understands that the purchase of this Warrant and its underlying securities involves substantial risk. Holder has experience as an investor in securities of companies in the development stage and acknowledges that Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such knowledge and experience in financial or business matters that Holder is capable of evaluating the merits and risks of its investment in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and certain of its officers, directors or controlling persons of a nature and duration that enables Holder to be aware of the character, business acumen and financial circumstances of such persons.
4.4 Accredited Investor Status. Holder is an “accredited investor” within the meaning of Regulation D promulgated under the Act.
4.5 The Act. Holder understands that this Warrant and the Units issuable upon exercise hereof have not been registered under the Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Holder’s investment intent as expressed herein. Holder understands that this Warrant and the Shares issued upon any exercise hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are otherwise available. Holder is aware of the provisions of Rule 144 promulgated under the Act.
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4.6 No Voting Rights. Holder, as a Holder of this Warrant, will not have any voting or other rights as a shareholder of the Company until the exercise of this Warrant.
SECTION 5 MISCELLANEOUS.
5.1 Term and Automatic Conversion Upon Expiration.
(a) Term. Subject to the provisions of Section 1.6 above, this Warrant is exercisable in whole or in part at any time and from time to time on or before 6:00 P.M. Pacific time, on the Expiration Date and shall be void thereafter.
(b) Automatic Cashless Exercise upon Expiration. In the event that, on the Expiration Date, the Fair Market Value of one Share (or other security issuable upon the exercise hereof) is greater than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised, and the Company shall, within a reasonable time and if certificated, deliver a certificate representing the Shares (or such other securities) issued upon such exercise to Holder.
5.2 Legends. The Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form unless the Company has received an opinion of counsel acceptable to the Company stating that such Shares need not bear any such legend:
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER, SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION. THE SHARES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE FOR A PERIOD OF 180 DAYS FOLLOWING MARCH 7, 2025 PURSUANT TO A LOCK-UP AGREEMENT A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER.
5.3 Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this Warrant (or other shares of the Company’s capital stock into which this Warrant is then exercisable) may not be transferred or assigned in whole or in part except in compliance with applicable federal and state securities laws by the transferor and the transferee (including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as reasonably requested by the Company). The Company shall not require Holder to provide an opinion of counsel if the transfer is to any affiliate of Holder. Additionally, the Company shall also not require an opinion of counsel if there is no material question as to the availability of Rule 144 promulgated under the Act.
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5.4 Transfer Procedure. Without in any way limiting the provisions of Section 5.3, the Holder shall not Transfer, or agree or offer to Transfer, all or any part of any interest in this Warrant without the prior written consent of the Company, which consent may be withheld in the Company’s discretion, provided, however, in connection with any such transfer, Holder will give the Company notice of the portion of this Warrant being transferred with the name, address and taxpayer identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable); and provided further, that any subsequent transferee shall agree in writing with the Company to be bound by all of the terms and conditions of this Warrant. For purposes of this Warrant, “Transfer” means any sale, transfer, assignment, pledge, mortgage, exchange, hypothecation, grant of a security interest or other direct or indirect disposition or encumbrance of an interest (including by operation of law and whether with or without consideration) or the act thereof, but explicitly excluding the exercise of this Warrant issued hereunder in accordance with its terms.
5.5 Notices. All notices and other communications hereunder from the Company to the Holder, or vice versa, shall be deemed delivered and effective (i) when given personally, (ii) on the third (3rd) Business Day after being mailed by first-class registered or certified mail, postage prepaid, (iii) upon actual receipt if given by electronic mail and such receipt is confirmed in writing by the recipient, or (iv) on the first Business Day following delivery to a reliable overnight courier service, courier fee prepaid, in any case at such address as may have been furnished to the Company or Holder, as the case may be, in writing by the Company or such Holder from time to time in accordance with the provisions of this Section 5.5. All notices to Holder shall be addressed as follows until the Company receives notice of a change of address in connection with a transfer or otherwise:
Kennedy Lewis Capital Partners Master Fund II LP
c/o Kennedy Lewis Investment Management
80 Broad Street, 22nd Floor
New York, NY 10004, United States
Attention: [***]
Email: [***]
With a copy (which shall not constitute notice) to:
Latham & Watkins LLP
505 Montgomery Street
Suite 2000
San Francisco, CA 94111-6538
Attn: [***]
Email: [***]
Notice to the Company shall be addressed as follows until Holder receives notice of a change in address:
c/o West Affum Holdings, L.P.
3933 Lake Washington Blvd NE, Suite 200
Kirkland, Washington 98033
Attention: [***]
Email: [***]
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With a copy (which shall not constitute notice) to:
Kirkland & Ellis LLP
333 West Wolf Point Plaza
Chicago, Illinois 606054
Attention: [***]
Email: [***]
5.6 Waiver. This Warrant and any term hereof may be changed, waived, discharged or terminated (either generally or in a particular instance and either retroactively or prospectively) only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought.
5.7 Attorneys’ Fees. In the event of any dispute between the parties concerning the terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorneys’ fees.
5.8 Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed in counterparts, all of which together shall constitute one and the same agreement. Any signature page delivered electronically or by facsimile shall be binding to the same extent as an original signature page with regards to any agreement subject to the terms hereof or any amendment thereto. The words “execution,” “execute”, “signed,” “signature,” and words of like import in or related to any document to be signed in connection with this Warrant and the transactions contemplated hereby (including without limitation assignments, assumptions, amendments, waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by the Holder, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.
5.9 Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of New York without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of the substantive laws of any jurisdiction other than the State of New York.
5.10 Headings. The headings in this Warrant are for purposes of reference only and shall not limit or otherwise affect the meaning of any provision of this Warrant.
5.11 Business Days. “Business Day” is any day that is not a Saturday, Sunday or a day on which banks in New York, New York are closed.
5.12 United States Dollars. All dollar ($) amounts specified in this Warrant are United States dollar amounts.
[Signature page follows]
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IN WITNESS WHEREOF, the parties have caused this Warrant to Purchase Units to be executed by their duly authorized representatives effective as of the Issue Date written above.
“COMPANY” | ||
KESTRA MEDICAL TECHNOLOGIES, LTD. | ||
By: | /s/ Brian Webster | |
Name: | Brian Webster | |
Title: | President and Chief Executive Officer | |
“HOLDER” | ||
KENNEDY LEWIS CAPITAL PARTNERS MASTER FUND II LP, a Cayman Islands limited partnership | ||
By: | /s/ Anthony Pasqua | |
Name: | Anthony Pasqua | |
Title: | Authorized Signatory |
[Signature Page to Warrant to Purchase Shares]
Accepted and agreed, solely for purposes of the Prior Warrant Termination, in its capacity as the Partnership (as defined in the Prior Warrant):
“HOLDINGS”
WEST AFFUM HOLDINGS, L.P., a Cayman Islands exempted limited partnership by its general partner WEST AFFUM GP LTD. a Cayman Islands exempted limited company. |
||
By: | /s/ Brian Webster | |
Name: | Brian Webster | |
Title: | Director |
[Signature Page to Warrant to Purchase Shares]
APPENDIX 1
NOTICE OF EXERCISE
1. The undersigned Holder hereby exercises its right purchase ___________ Common Shares, par value $1.00 per share, of Kestra Medical Technologies, Ltd., a limited company organized under the laws of Bermuda (the “Company”), in accordance with the attached Warrant To Purchase Shares, and tenders payment of the aggregate Warrant Price for such Common Shares as follows:
[ ] | Wire transfer of immediately available funds to the Company’s account |
[ ] | Cashless Exercise pursuant to Section 1.2 of the Warrant |
[ ] | Other [describe]__________________________ |
2. Please instruct the Transfer Agent to issue such Common Shares in the name(s) specified below.
Name(s): _________________________
3. By its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in SECTION 4 of the Warrant to Purchase Shares as of the date hereof.
HOLDER: |
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By: |
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Name: |
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Title: |
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(Date): |
Appendix 1
Exhibit 10.3
WARRANT CERTIFICATE
THIS WARRANT CERTIFICATE AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR QUALIFIED UNDER ANY STATE OR FOREIGN SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED OR ASSIGNED UNLESS (I) A REGISTRATION STATEMENT COVERING SUCH SECURITIES IS EFFECTIVE UNDER THE SECURITIES ACT AND IS QUALIFIED UNDER APPLICABLE STATE AND FOREIGN LAW OR (II) THE TRANSACTION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS UNDER THE SECURITIES ACT AND THE QUALIFICATION REQUIREMENTS UNDER APPLICABLE STATE AND FOREIGN LAW. THIS WARRANT CERTIFICATE AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE FOR A PERIOD OF 180 DAYS FOLLOWING MARCH 7, 2025 PURSUANT TO A LOCK-UP AGREEMENT EXECUTED BY THE HOLDER OF THIS WARRANT PRIOR TO THE DATE OF ISSUANCE OF THIS WARRANT.
Warrant Securities Issuable: | Initially, up to 325,847 Common Shares, par value $1.00 per share, of the Issuer (the “Common Shares”), as such number of Warrant Securities may be increased pursuant to Section 2(a) or adjusted pursuant to Section 4. | |
Warrant Certificate No.: |
2025-01 | |
Issue Date: |
March 7, 2025 (the “Initial Issue Date”) |
FOR VALUE RECEIVED, KESTRA MEDICAL TECHNOLOGIES, LTD., an exempted company limited by shares incorporated under the laws of Bermuda (the “Issuer”), hereby certifies that Perceptive Credit Holdings IV, LP, a Delaware limited partnership (the “Holder”) is entitled to purchase from the Issuer that number of Warrant Securities calculated in accordance with Section 2(a), at the per share Exercise Price (defined below), subject to the terms, conditions and adjustments set forth below in this Warrant Certificate. Certain capitalized terms used herein are defined in Section 1.
Reference is made to that certain Warrant Certificate, Number 2023-01, issued on September 29, 2023, by West Affum Holdings, L.P., an exempted limited partnership registered in the Cayman Islands (“Holdings”) to the Holder, as amended by that certain First Amendment to Warrant Certificate, dated July 12, 2024 (the “Prior Warrant”). The parties hereto, on behalf of themselves and each of their Affiliates, hereby acknowledge and agree that this Warrant Certificate hereby replaces and supersedes the Prior Warrant in its entirety, the Prior Warrant is hereby terminated in full, and no Person shall have any further rights or obligations pursuant to or in connection with the Prior Warrant, in each case, without any further action by any Person (this sentence, the “Prior Warrant Termination”).
Section 1.Definitions. The following terms when used herein have the following meanings:
“Acquisition” has the meaning set forth in Section 3(m).
“Additional Warrant Securities” has the meaning set forth in Section 2(a)(ii).
“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified, where “Control” means, in respect of a particular Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlled” have meanings correlative thereto.
“Aggregate Exercise Price” means, with respect to any exercise of this Warrant Certificate for Warrant Securities, an amount equal to the product of (i) the number of Warrant Securities in respect of which this Warrant Certificate is then being exercised pursuant to Section 3 multiplied by (ii) the Exercise Price.
“Anticipated Sale” has the meaning set forth in Section 3(j).
“Bloomberg” has the meaning set forth within the definition of VWAP.
“Business Day” means any day, except a Saturday, Sunday or legal holiday on which banking institutions in the city of New York, New York are authorized or obligated by law or executive order to close.
“Bye-Laws” means the Issuer’s bye-laws from time to time.
“Cash Acquisition” has the meaning set forth in Section 3(m).
“Cashless Exercise” has the meaning set forth in Section 3(b).
“Common Shares” has the meaning set forth in the preamble.
“Convertible Securities” means any debt, equity or other securities that are, directly or indirectly, convertible into or exchangeable for Warrant Securities.
“Credit Agreement” means that certain Credit Agreement and Guaranty dated as of September 29, 2023, among Kestra Medical Technologies, Inc. and West Affum Holdings Corp. as borrowers, the guarantors party thereto, the lenders from time to time party thereto, and Perceptive Credit Opportunities Fund IV, LP, as the administrative agent, as amended by that certain Consent and First Amendment to Credit Agreement, dated as of July 12, 2024, that certain Second Amendment to Credit Agreement, dated as of February 25, 2025, and as may be further amended or otherwise modified from time to time.
“Delivery Deadline” means, (x) at any time that the Issuer’s equity securities are not being traded on a Trading Market, five (5) Business Days after the Exercise Date in respect of such exercise, and (y) at any time that the Issuer’s equity securities are traded on a Trading Market, two (2) Business Days after the Exercise Date in respect of such exercise.
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“Delivery Failure” means the failure by the Issuer, for any reason, to deliver Warrant Securities to the Holder or its designee on or prior to the Delivery Deadline.
“DTC” means the Depository Trust Company.
“Exercise Certificate” has the meaning set forth in Section 3(a)(i).
“Exercise Date” means, for any given exercise of this Warrant Certificate, whether in whole or in part, the date on which the conditions to such exercise as set forth in Section 3 shall have been satisfied at or prior to 5:00 p.m., Eastern time, on a Trading Day, including, without limitation, the receipt by the Issuer of the Exercise Certificate and the Aggregate Exercise Price.
“Exercise Period” has the meaning set forth in Section 2(b).
“Exercise Price” means $11.54 per Warrant Security, as the same may be adjusted as set forth herein.
“Fair Market Value” means, as of any particular Trading Day, the VWAP of such equity securities for such day. If the Issuer’s equity securities are not listed, quoted or otherwise available for trading, the “Fair Market Value” of the applicable class of equity securities shall be the fair market value, per share, of such equity securities as determined jointly by the Issuer and the Holder.
“Fundamental Change” means any event or circumstance that constitutes or results in (i) an Acquisition or (ii) the Liquidation of the Issuer.
“Holder” has the meaning set forth in the preamble.
“Holdings” has the meaning set forth in the preamble.
“Initial Issue Date” has the meaning set forth in the preamble.
“Issue Date” means the Initial Issue Date or the applicable date that Additional Warrant Securities are issued pursuant to Section 2(a), as applicable.
“Issuer” has the meaning set forth in the preamble and, for the avoidance of doubt, includes any corporation or other entity into which the Issuer may convert, amalgamate or merge following the date hereof.
“Liquidation” means the liquidation, dissolution or winding up of the Issuer, whether voluntary or involuntary.
“Nasdaq” means The Nasdaq Stock Market, Inc.
“Options” means any warrants or other rights or options to subscribe for or purchase Warrant Securities or Convertible Securities.
“OTC Bulletin Board” means the National Association of Securities Dealers, Inc. OTC Bulletin Board.
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“Perceptive Fund” means Perceptive Credit Holdings IV, LP and any Affiliate of Perceptive Credit Holdings IV, LP.
“Person” means any individual, sole proprietorship, partnership, limited liability company, corporation, exempted company, exempted limited partnership, joint venture, trust, incorporated organization or government or department or agency thereof.
“Prior Warrant” has the meaning set forth in the preamble.
“Purchase Rights” has the meaning set forth in Section 5.
“Registration Agreement” means the Second Amended and Restated Registration Rights Agreement, dated July 15, 2024, which was assigned to and assumed by the Issuer in connection with its initial public offering and to which the Holder has become a party by signing a joinder thereto in connection with this Warrant Certificate.
“SEC” means the Securities and Exchange Commission or any successor thereto.
“Securities Act” means the Securities Act of 1933, as amended.
“Trading Day” means, (x) at any time that the Issuer’s equity securities are not being traded on a Trading Market, a Business Day, and (y) at any time that the Issuer’s equity securities are traded on a Trading Market, a day on which the applicable Trading Market is open for trading.
“Trading Market” means Nasdaq or, if the Issuer’s equity securities are not listed on Nasdaq, such other principal US or foreign exchange or market (including the OTC Bulletin Board) on which the Issuer’s equity securities are quoted or available for trading.
“Transfer Agent” means Computershare Trust Company, National Association or any successor transfer agent of the Issuer.
“Unlegended Securities” has the meaning set forth in Section 12(a)(iii).
“Unrestricted Conditions” has the meaning set forth in Section 12(a)(ii).
“VWAP” means, for any security as of any day or period of days (as the case may be), the volume weighted average sale price on the Trading Market as reported by, or based upon data reported by Bloomberg Financial Markets or an equivalent, reliable reporting service reasonably acceptable to the Holder and the Issuer (collectively, “Bloomberg”) or, if no volume weighted average sale price is reported for such security by Bloomberg, then the last closing trade price of such security as reported by Bloomberg, or, if no last closing trade price is reported for such security by Bloomberg, the average of the bid prices of any market makers for such security that are listed in the over the counter market by the Financial Industry Regulatory Authority, Inc. or on the OTC Bulletin Board (or any successor) or in the “pink sheets” (or any successor) by the OTC Markets Group, Inc.
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“Warrant” or “Warrant Certificate” means this Warrant Certificate and all subsequent warrant certificates issued upon division, combination or transfer of, or in substitution for, this Warrant Certificate.
“Warrant Register” has the meaning set forth in Section 7.
“Warrant Securities” means the Common Shares or other equity securities or equivalent interests of the Issuer then purchasable upon exercise of this Warrant Certificate in accordance with the terms of this Warrant Certificate.
Section 2. Number of Warrant Securities; Term of Warrant Certificate.
(a) Number of Warrant Securities. The number of Warrant Securities that are subject to this Warrant Certificate shall be determined in accordance with the following terms:
(i) On the date hereof, this Warrant Certificate shall be exercisable for 325,847 Warrant Securities (such Warrant Securities, the “Initial Warrant Securities”). The Issuer represents and warrants that, as of the Issue Date, the Initial Warrant Securities have an Aggregate Exercise Price equal to $3,760,274.38.
(ii) On each date that additional funds are advanced under the Credit Agreement, the number of Warrant Securities purchasable pursuant to this Warrant Certificate shall automatically increase such that the Aggregate Exercise Price for all Warrant Securities purchasable hereunder is equal to 10% of the aggregate amount funded under the Credit Agreement (such Warrant Securities, the “Additional Warrant Securities”). For the avoidance of doubt, the initial Exercise Price for the Additional Warrant Securities shall be the same as the initial Exercise Price for the Initial Warrant Securities, subject to any adjustment pursuant to Section 4.
The Holder shall be entitled to exercise this Warrant Certificate to purchase all or any portion of the Warrant Securities that are issuable hereunder pursuant to the terms of this Section 2(a), and all references herein to the “Warrant Securities” shall refer to the Initial Warrant Securities and the Additional Warrant Securities (if any), calculated as of the relevant date of determination. As promptly as reasonably practicable following the receipt by the Issuer of a written request by the Holder, but in any event not later than five Business Days thereafter, the Issuer shall furnish to the Holder a certificate executed by any duly authorized officer of the Issuer certifying the number of Warrant Securities for which this Warrant Certificate is exercisable, or the amount, if any, of other securities or assets then issuable upon exercise of this Warrant Certificate.
(b) Exercise Period. Subject to the terms and conditions hereof, at any time or from time to time on or after the applicable Issue Date and prior to 5:00 p.m., Eastern time, on the tenth anniversary of such date or, if such day is not a Trading Day, on the next preceding Trading Day (the “Exercise Period”), the Holder of this Warrant Certificate may exercise this Warrant Certificate for all or any part of the Warrant Securities purchasable hereunder (subject to adjustment as provided herein); provided that, the Exercise Period with respect to the Initial Warrant Securities shall expire on September 29, 2033.
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Section 3. Exercise of Warrant Certificate.
(a) Exercise Procedure. This Warrant Certificate may be exercised from time to time on any Trading Day during the Exercise Period, for all or any part of the unexercised Warrant Securities, upon:
(i) delivery to the Issuer at its registered office of an Exercise Certificate in the form attached hereto as Exhibit A (each, an “Exercise Certificate”), duly completed (including specifying the number of Warrant Securities to be purchased) and executed;
(ii) payment to the Issuer of the Aggregate Exercise Price in accordance with Section 3(b); and
(iii) delivery to the Issuer of any other documentation required by the Transfer Agent in connection with exercise of this Warrant Certificate or the issuance of the applicable Warrant Securities.
(b) Payment of the Aggregate Exercise Price. Payment of the Aggregate Exercise Price shall be made, at the option of the Holder as expressed in the Exercise Certificate, by any of the following methods:
(i) by delivery to the Issuer of a certified or official bank check payable to the order of the Issuer or by wire transfer of immediately available funds to an account designated in writing by the Issuer, in the amount of such Aggregate Exercise Price; or
(ii) in lieu of payment of the Aggregate Exercise Price in the manner as specified in Section 3(b)(i), but otherwise in accordance with the requirements of Section 3, by electing to surrender in payment of the Aggregate Exercise Price for the Warrant Securities then issuable upon exercise of this Warrant Certificate a number of Warrant Securities equal in value to the Aggregate Exercise Price of the Warrant Securities being purchased, in which case, the Issuer shall instruct the Transfer Agent to issue to the Holder such number of Warrant Securities in book entry form and Holder shall irrevocably surrender for no value the number of Warrant Securities subject to this Warrant Certificate as are computed using the following formula:
X = Y[(A-B)/A]
where:
X = the number of Warrant Securities to be issued to the Holder;
Y = the number of Warrant Securities with respect to which this Warrant Certificate is being exercised (inclusive of the Warrant Securities subject to this Warrant Certificate surrendered to the Issuer in payment of the Aggregate Exercise Price);
A = Fair Market Value per Warrant Security as of the Exercise Date; B = the Exercise Price; and
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Y-X = the number of Warrant Securities subject to this Warrant Certificate to be irrevocably surrendered for no value by the Holder in exchange for X number of Warrant Securities.
In the event of any withholding or surrender of Warrant Securities pursuant to Section 3(b)(ii) (solely to the extent of such withholding or surrender, a “Cashless Exercise”) where the number of equity securities whose value is equal to the Aggregate Exercise Price is not a whole number, the number of equity securities or equivalent interests withheld by or surrendered to the Issuer shall be rounded up to the nearest whole equity security or equivalent interest and the Issuer shall make a cash payment to the Holder (by delivery of a certified or official bank check or by wire transfer of immediately available funds) based on the incremental fraction of an equity security or equivalent interest being so withheld by or surrendered to the Issuer in an amount equal to the product of (x) such incremental fraction of an equity security or equivalent interest being so withheld or surrendered multiplied by (y) in the case of Common Shares, the Fair Market Value per Warrant Security as of the Exercise Date.
For purposes of Rule 144, to the extent permitted by applicable law, it is acknowledged and agreed that (i) the Warrant Securities issuable upon any exercise of this Warrant Certificate in any Cashless Exercise transaction shall be deemed to have been acquired on the applicable Issue Date, and (ii) the holding period for any Warrant Securities issuable upon the exercise of this Warrant Certificate in any Cashless Exercise transaction shall be deemed to have commenced on the applicable Issue Date; provided that the Issuer makes no representation or warranty regarding the commencement of the holding period of any Warrant Securities or the availability of Rule 144 (or any equivalent rule).
(c) Delivery of Warrant Securities.
(i) Following any Exercise Date, the Issuer shall, on or before the applicable Delivery Deadline, issue and deliver (or cause its Transfer Agent to issue and deliver) in accordance with the terms hereof to or upon the order of the Holder that number Warrant Securities for the portion of this Warrant Certificate so exercised on such Exercise Date in book entry form, and shall register (or cause its Transfer Agent to register) such securities in the register of members of the Issuer in the name of the Holder or, subject to compliance with Section 8, in such other Person’s name as shall be designated in the Exercise Certificate. If requested in writing by the Holder, the Issuer shall deliver to the Holder evidence of the issuance of the Warrant Securities purchased in connection with such exercise in a form and substance reasonably acceptable to the Holder. This Warrant Certificate shall be deemed to have been exercised and the Warrant Securities shall be deemed to have been issued, and the Holder or any other Person so designated to be named therein shall be deemed to have become a holder of record of such Warrant Securities for all purposes, as of the applicable Issue Date.
(ii) If, at the time of exercise, the Issuer has a Transfer Agent, then upon the exercise this Warrant Certificate in whole or in part, the Issuer shall, at its own cost and expense, take all necessary action, including obtaining and delivering an opinion of counsel, to assure that the Transfer Agent shall issue Warrant Securities in the name of the Holder (or its nominee) or such other Persons as designated by the Holder (in compliance with Section 8) and in such denominations to be specified in the applicable Exercise Certificate.
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The Issuer represents and warrants that no instructions other than the foregoing instructions will be given to the Transfer Agent and that, if the Unrestricted Conditions are met, the Warrant Securities will be free-trading, and freely transferable, and will not contain a legend restricting the resale or transferability of the Warrant Securities.
(iii) In addition to any other remedies which may be available to the Holder, in the event of any Delivery Failure relating to the issuance of Warrant Securities upon exercise of this Warrant Certificate, the Holder will be entitled to revoke all or part of the relevant Exercise Certificate by delivery of a notice to such effect to the Issuer whereupon the Issuer and the Holder shall each be restored to their respective positions immediately prior to the delivery of such Exercise Certificate.
(d) Fractional Warrant Securities. The Issuer may issue fractional Warrant Securities in accordance with the Bye-Laws.
(e) Surrender of this Warrant Certificate; Delivery of New Warrant Certificate.
(i) Subject to Section 3(e)(ii), the Holder shall not be required to physically surrender this Warrant Certificate to the Issuer until the Holder has purchased (or acquired or surrendered pursuant to a Cashless Exercise) all of the Warrant Securities available hereunder and this Warrant Certificate has been exercised in full, in which case, the Holder shall, at the written request of the Issuer, surrender this Warrant Certificate to the Issuer for cancellation within three (3) Business Days after the date the final Exercise Certificate is delivered to the Issuer. Partial exercises of this Warrant Certificate resulting in purchases (or acquisition pursuant to a Cashless Exercise) of a portion of the total number of Warrant Securities available hereunder shall have the effect of lowering the outstanding number of Warrant Securities purchasable hereunder in an amount equal to the applicable number of Warrant Securities purchased (or acquired or surrendered pursuant to a Cashless Exercise). The Holder and the Issuer shall maintain (or cause to be maintained, including through a Transfer Agent) records showing the number of Warrant Securities purchased, otherwise acquired or surrendered and the date of such purchases, other acquisitions or surrenders. The Holder and any assignee, by acceptance of this Warrant Certificate, acknowledge and agree that, by reason of the provisions of this Section 3(e), following the purchase (or acquisition or surrender pursuant to a Cashless Exercise) of a portion of the Warrant Securities hereunder, the number of Warrant Securities available for purchase hereunder at any given time may be less than the amount stated on the face hereof.
(ii) Notwithstanding the foregoing, the Holder may request that the Issuer (and the Issuer shall), following Holder’s surrender of this Warrant Certificate to the Issuer, deliver to the Holder a new Warrant Certificate evidencing the rights of the Holder to purchase the unexpired and unexercised Warrant Securities called for by this Warrant Certificate. Unless otherwise agreed upon by the Holder in its sole discretion, such new Warrant Certificate shall in all other respects be identical to this Warrant Certificate.
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(f) Valid Issuance of Warrant Certificate and Warrant Securities; Payment of Taxes; Covenants. The Issuer hereby represents, covenants and agrees as of the date hereof, as of each subsequent Issue Date, and as of the Tranche C Borrowing Date (each as defined in the Credit Agreement):
(i) The transactions contemplated by this Warrant Certificate are within the Issuer’s organizational powers and have been duly authorized by all necessary corporate action of the Issuer and, if required, by all necessary shareholder action. This Warrant Certificate has been duly executed and delivered by the Issuer and constitutes a legal, valid and binding obligation of the Issuer, enforceable against the Issuer in accordance with its terms, except as such enforceability may be limited by (A) bankruptcy, insolvency, reorganization, moratorium or similar laws of general applicability affecting the enforcement of creditors’ rights and (B) the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
(ii) This Warrant Certificate is, and any Warrant Certificate issued in substitution for or replacement of this Warrant Certificate delivered in accordance with Section 3(e)(ii) shall be, upon issuance, duly authorized and validly issued.
(iii) All Warrant Securities issuable upon the exercise of this Warrant Certificate (or any substitute or replacement Warrant Certificate delivered in accordance with Section 3(e)(ii)) pursuant to the terms hereof shall be, upon issuance, and the Issuer shall take all such actions as may be necessary or appropriate in order that such Warrant Securities are, validly issued, fully paid and non-assessable, issued without violation of any preemptive or similar rights of any shareholder of the Issuer and free and clear of all liens, except for restrictions on transfer provided for herein or in any lock-up agreement to which the Holder is a party, or under applicable federal and state securities laws.
(iv) The Issuer shall take all such actions as may be necessary to ensure that all such Warrant Securities are issued without violation by the Issuer of any applicable law or governmental regulation, or any requirements of any Trading Market upon which Common Shares, or other securities constituting Warrant Securities may be listed at the time of such exercise (except for official notice of issuance which shall be promptly delivered by the Issuer upon each such issuance).
(v) Without duplication of any expense reimbursement provisions of the Credit Agreement, the Issuer shall bear and reimburse all of the Holder’s reasonable and documented out-of-pocket costs and expenses in connection with the evaluation and negotiation of this Warrant Certificate.
(vi) Each of the Issuer on the one hand, and the Holder, on the other bear all of their and their respective Affiliates taxes that may be imposed with respect to the issuance or delivery of Warrant Securities upon exercise of this Warrant Certificate.
(g) Conditional Exercise. Notwithstanding any other provision hereof, if an exercise of any portion of this Warrant Certificate is to be made in connection with a Fundamental Change, such exercise may, at the election of the Holder, be conditioned upon the consummation of such transaction, in which case such exercise shall not be deemed to be effective until immediately prior to the consummation of such transaction.
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(h) Reservation of Warrant Securities. During the Exercise Period the Issuer shall at all times reserve and keep available out of its authorized but unissued Common Shares or other securities or equivalent interests constituting Warrant Securities, solely for the purpose of issuance upon the exercise of this Warrant Certificate, the maximum number of Warrant Securities issuable upon the exercise of this Warrant Certificate. The Issuer shall take all such actions as may be necessary or appropriate in order that the Issuer may validly and legally issue fully paid and nonassessable Common Shares upon the exercise of this Warrant Certificate without the need for the passing of any further resolutions of its shareholders or obtaining any further consents from any party.
(i) Delivery of Electronic Securities. To the extent the Unrestricted Conditions are satisfied with respect to the Warrant Securities to be issued to the Holder upon the exercise of this Warrant Certificate, the Issuer shall use its commercially reasonable best efforts to cause the Transfer Agent to electronically transmit such Warrant Securities to the Holder by crediting the account of the Holder’s prime broker with the DTC through its Deposit Withdrawal Agent Commission system. The time periods for delivery and penalties described herein shall apply to the electronic transmittals described herein. Any delivery not effected by electronic transmission shall be effected by delivery of physical certificates.
(j) Make Whole. In addition to any other rights available to the Holder, if, as a result of a Delivery Failure in respect of Warrant Securities, the Holder is required by its broker to purchase (in an open market transaction or otherwise), or the Holder’s brokerage firm otherwise purchases, Warrant Securities to deliver in satisfaction of a sale anticipated to be made by the Holder of all or portion of such Warrant Securities which are the subject of such Delivery Failure (an “Anticipated Sale”), then the Issuer shall (i) pay to the Holder, in cash, an amount equal to the reasonable and documented out-of-pocket costs and expenses incurred by Holder in covering the trade (including reasonable and documented brokerage fees, if any), and (ii) at the option of the Holder, either reinstate the portion of this Warrant Certificate and equivalent number of Warrant Securities in respect of which such Delivery Failure occurred, or deliver to the Holder the number of Warrant Securities that would have been issued had the Issuer timely complied with its obligations hereunder to issue such Warrant Securities upon such exercise. For the avoidance of doubt, this Section 3(j) is intended as a “make whole” and shall not be interpreted in any manner that would result in the Holder being in a better economic position following application of the provisions of this Section 3(j) than if there had not been a Delivery Failure. Holder shall provide the Issuer written notice indicating the amounts payable to the Holder, together with applicable confirmations and other evidence reasonably requested by the Issuer. Nothing herein shall limit the Holder’s right to pursue any other remedies available to it hereunder at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to any Delivery Failure.
(k) Dispute Resolution. In the case of any dispute as to the determination of Fair Market Value =, the arithmetic calculation of the Exercise Price or any other computation required to be made hereunder, in the event the Holder and the Issuer, negotiating in good faith, are unable to settle such dispute within five (5) Business Days (or such longer period as the parties may agree), then either party may elect to submit the disputed matter(s) for resolution by an independent accountant, appraiser or investment bank (with relevant experience) acceptable to the other party. Such independent party’s determination of such disputed matter(s) shall be binding upon all parties absent demonstrable error, and the Issuer and the Holder shall each pay one half of the fees and costs of such independent party.
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(l) Automatic Exercise at Expiration or Liquidation. If a Liquidation occurs with respect to the Issuer at any time prior to the expiration of the Exercise Period and there remain any Warrant Securities subject to this Warrant Certificate, or if immediately prior to the expiration of the Exercise Period there remain any Warrant Securities subject to this Warrant Certificate, this Warrant Certificate shall be deemed to be automatically exercised in full for the full number of remaining Warrant Securities, without the requirement for the delivery of an Exercise Certificate, and if the automatic exercise is in connection with a Liquidation, the Holder shall receive its pro rata share of the proceeds from such Liquidation as if the Warrant Securities were outstanding immediately prior to the Liquidation (subject to set-off against the Aggregate Exercise Price); provided that, unless the giving of notice is not practicable due to the circumstances of the Liquidation, the Issuer shall give the Holder notice of any pending Liquidation as soon as practicable but in any event not less than 10 Business Days prior to the anticipated consummation of the Liquidation and if the Holder does not wish to automatically have this Warrant Certificate exercised, the Holder may opt out of such automatic exercise by written notice to the Issuer in advance of the consummation of the Liquidation.
(m) Treatment of Warrant Certificate Upon Acquisition of Issuer.
(i) For the purpose of this Warrant Certificate, “Acquisition” means any transaction or series of related transactions involving: (w) the sale, lease, exclusive license or other disposition of all or substantially all of the assets of the Issuer to one or more third parties not Controlled by the Issuer; (x) any amalgamation, merger or consolidation of the Issuer into or with another Person or entity (other than an amalgamation, merger or consolidation effected exclusively to change the Issuer’s domicile), or any other reorganization, in which the shareholders of the Issuer immediately prior to such amalgamation, merger, consolidation or reorganization, own less than a majority of the Issuer’s (or the amalgamated company, surviving or successor entity’s) outstanding voting power immediately after such amalgamation, merger, consolidation or reorganization; and (y) any sale or other transfer by the shareholders of the Issuer to one or more Persons or group of Persons not Controlled by the Issuer of equity securities or equivalent interests representing a majority of the Issuer’s then-total outstanding combined voting power.
(ii) In the event of an Acquisition in which the consideration to be received by the Issuer’s shareholders consists solely of cash (a “Cash Acquisition”), either (x) Holder shall exercise this Warrant Certificate pursuant to Section 3 and such exercise will be deemed effective immediately prior to and contingent upon the consummation of such Cash Acquisition or (y) if Holder elects not to exercise the Warrant, this Warrant will expire immediately prior to the consummation of such Cash Acquisition.
(iii) The Issuer shall provide Holder with written notice of its request relating to the Cash Acquisition (together with such information as Holder may reasonably require regarding the treatment of this Warrant in connection with such contemplated Cash Acquisition giving rise to such notice), which is to be delivered to Holder not less than 10 days prior to the closing of the proposed Cash Acquisition unless the giving of such notice is not legally permissible in connection with such Cash Acquisition.
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Notwithstanding the foregoing, if, immediately prior to the Cash Acquisition, the Fair Market Value of one Warrant Security would be greater than the Exercise Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised pursuant a Cashless Exercise with respect to all Warrant Securities for which it shall not previously have been exercised, and the Issuer shall promptly notify the Holder of the number of Common Shares (or such other securities) issued upon such exercise to the Holder.
(iv) Upon the closing of any Acquisition other than a Cash Acquisition, the acquiring, surviving or successor entity shall assume the obligations of this Warrant, and this Warrant shall thereafter be exercisable for the same securities and/or other property as would have been paid for the Warrant Securities issuable upon exercise of the unexercised portion of this Warrant as if such Warrant Securities were outstanding on and as of the closing of such Acquisition, subject to further adjustment from time to time in accordance with the provisions of this Warrant.
(n) Holder’s Exercise Limitations. The Issuer shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to this Section 3 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Exercise Certificate, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of Common Share equivalents beneficially owned by the Holder and its Affiliates shall include the number of Common Share equivalents issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of Common Share equivalents which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates, and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Issuer (including, without limitation, any other Common Share equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates. Except as set forth in the preceding sentence, for purposes of this Section 3(n), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Issuer is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 3(n) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of an Exercise Certificate shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Issuer shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 3(n), in determining the number of outstanding Common Shares, Holder may rely on the number of outstanding Common Shares as reflected in the most recent public announcement by the Issuer. Upon the written request of a Holder, the Issuer shall within five (5) Business Days confirm orally and in writing to the Holder the number of Common Shares then outstanding.
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In any case, the number of outstanding Common Shares shall be determined after giving effect to the conversion or exercise of securities of the Issuer, including this Warrant, by the Holder or its Affiliates since the date as of which such number of outstanding Common Shares was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the number of Common Shares and Common Share equivalents outstanding immediately after giving effect to the applicable issuance of Warrant Securities issuable upon exercise of this Warrant if at the time of exercise the Issuer is a “reporting issuer” under the Securities Exchange Act of 1934. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 3(n) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
(o) Holder Cancellation Right. Notwithstanding the other rights granted to Holder herein, so long as the Holder of this Warrant Certificate is a Perceptive Fund, then following a Fund Administration Event (as defined below), the Holder shall have the right (the “Cancellation Right”), without the consent of the Issuer or any other Person, to irrevocably cancel and render void this Warrant Certificate and all of the Holder’s rights and the Issuer’s obligations hereunder shall survive the cancellation. The Holder may exercise its Cancellation Right by written notice to the Issuer (the “Cancellation Notice”), which notice shall specify the circumstances of the Fund Administration Event. The cancellation contemplated by this Section 3(o) shall be effective as of the date specified in the Cancellation Notice and the Holder shall remain liable for all obligations and liabilities as Holder of this Warrant Certificate through such effective date specified in the Cancellation Notice. As used in this Section 3(o), “Fund Administration Event” means that the Holder has entered its wind down phase and the Holder has reasonably determined in good faith that the value of this Warrant Certificate is de minimis. For the avoidance of doubt, if a Perceptive Fund is no longer the Holder of this Warrant Certificate, the rights under this Section 3(o) shall automatically terminate.
Section 4. Adjustments. In order to prevent dilution of the Purchase Rights granted under this Warrant Certificate, the number of Warrant Securities issuable upon exercise of this Warrant Certificate shall be subject to adjustment from time to time as provided in this Section 4.
(a) Other Dividends and Distributions. If the Issuer shall, at any time or from time to time after the Issue Date, make or declare, or fix a record date for the determination of holders of equity securities or equivalent interests entitled to receive, a dividend or any other distribution payable in cash, securities or interests of the Issuer (other than a dividend or distribution of Common Shares, Options or Convertible Securities in respect of outstanding equity securities or equivalent interests of the Issuer) or other property, then, and in each such event, the Issuer shall ensure that provisions are made so that the Holder shall receive upon exercise of this Warrant Certificate, in addition to the number of Warrant Securities receivable thereupon, the kind and amount of cash, securities or interests of the Issuer or other property which the Holder would have been entitled to receive had this Warrant Certificate been exercised in full into Warrant Securities on the date of such event and had the Holder thereafter, during the period from the date of such event to and including the Exercise Date, retained such cash, securities, interests or other property receivable by them as aforesaid during such period, giving application to all adjustments called for during such period under this Section 4 with respect to the rights of the Holder.
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(b) Adjustment to Number of Warrant Securities Upon Dividend, Subdivision or Combination of Common Shares. If the Issuer shall, at any time or from time to time after the Issue Date, (i) pay a bonus issue, dividend or make any other distribution upon the Common Shares (or other shares of the Issuer’s share capital into which this Warrant is then exercisable) payable in Common Shares (or other shares of the Issuer’s share capital into which this Warrant is then exercisable) or in Options or Convertible Securities, or (ii) subdivide (by any equity split or equivalent interest split, recapitalization or otherwise) its outstanding Common Shares (or other shares of the Issuer’s share capital into which this Warrant is then exercisable) into a greater number of shares, the number of Warrant Securities issuable upon exercise of this Warrant Certificate immediately prior to any such bonus issue, dividend, distribution or subdivision shall be proportionately increased and the Exercise Price applicable to each such Warrant Security shall be proportionately decreased. If the Issuer at any time combines (by combination, consolidation, reverse equity split or otherwise) its outstanding Common Shares (or other shares of the Issuer’s share capital into which this Warrant is then exercisable) into a smaller number of shares, the number of Warrant Securities issuable upon exercise of this Warrant Certificate immediately prior to such combination shall be proportionately decreased and the Exercise Price applicable to each such Warrant Security shall be proportionately increased. Any adjustment under this Section 4(b) shall become automatically effective upon the effectiveness of such bonus issue, dividend, subdivision, consolidation or combination.
(c) Adjustment to Number of Warrant Securities Upon Reorganization, Reclassification, Consolidation, Amalgamations or Merger.
(i) Unless the Holder otherwise consents (in its sole discretion), the event of any (A) capital reorganization of the Issuer, (B) reclassification of the equity securities or equivalent interests of the Issuer (other than as a result of a bonus issue, dividend or subdivision, split-up, consolidation or combination of equity securities or equivalent interests already covered by this Section 4), (C) Fundamental Change or (D) other similar transaction (other than a Cash Acquisition covered by Section 3(m) (Treatment of Warrant Upon an Acquisition), or an event covered by Section 4(b) (Adjustment Upon Dividend, Subdivision, or Combination of Common Shares)), including a Liquidation or an acquisition, amalgamation, merger, or other transaction in which the Warrant Certificate is not exercised, in each case which entitles the holders of Common Shares (or other shares of the Issuer’s share capital into which this Warrant is then exercisable) to receive (either directly or upon subsequent liquidation) securities, interests or assets with respect to or in exchange for Common Shares (or other shares of the Issuer’s share capital into which this Warrant is then exercisable):
(1) this Warrant Certificate shall, immediately after such reorganization, reclassification, consolidation, amalgamation, merger, sale or similar transaction, remain outstanding and shall thereafter, in lieu of or in addition to (as the case may be) the number of Warrant Securities then exercisable under this Warrant Certificate, be exercisable for the kind and number of equity securities or equivalent interest or other assets of the Issuer or of the successor Person resulting from such transaction to which the Holder would have been entitled upon such reorganization, reclassification, consolidation, amalgamation, merger, sale or similar transaction if the Holder had exercised this Warrant Certificate in full immediately prior to the time of such reorganization, reclassification, consolidation, amalgamation, merger, sale or similar transaction and acquired the applicable number of Warrant Securities then issuable hereunder as a result of such exercise (without taking into account any limitations or restrictions on the exercisability of this Warrant Certificate); and
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(2) appropriate adjustment (in form and substance reasonably satisfactory to the Holder and Issuer) shall be made with respect to the Holder’s rights under this Warrant Certificate to insure that the provisions of this Section 4 shall thereafter be applicable, as nearly as possible, to this Warrant Certificate in relation to any securities or assets thereafter acquirable upon exercise of this Warrant Certificate.
The provisions of this Section 4(c) shall similarly apply to successive reorganizations, reclassifications, consolidations, amalgamations, mergers, sales or similar transactions.
(ii) Notwithstanding anything to the contrary contained herein, with respect to any event or other transaction contemplated by this Section 4(c), the Holder shall have the right to elect, upon written notice delivered to the Issuer prior to the consummation of such event or transaction, to exercise its rights under Section 2 instead of giving effect to Section 4(c)(i).
(d) Certain Events. Upon the occurrence of any event of the type contemplated by the provisions of this Section 4 but not expressly provided for herein, the Issuer shall make an appropriate adjustment in the number of Warrant Securities issuable upon exercise of this Warrant Certificate and the Exercise Price applicable thereto so as to protect the rights of the Holder in a manner consistent with the provisions of this Section 4.
(e) Certificate as to Adjustment.
(i) As promptly as reasonably practicable following any adjustment of the number of Warrant Securities issuable upon exercise of this Warrant Certificate, but in any event not later than five Business Days thereafter, the Issuer shall furnish to the Holder a certificate of an executive officer of the Issuer setting forth in reasonable detail such adjustment and the facts upon which it is based and certifying the calculation thereof.
(ii) As promptly as reasonably practicable following the receipt by the Issuer of a written request by the Holder, but in any event not later than five Business Days thereafter, the Issuer shall furnish to the Holder a certificate of an executive officer of the Issuer certifying the number of Warrant Securities for which this Warrant Certificate is exercisable, or the amount, if any, of other securities, interests or assets then issuable upon exercise of this Warrant Certificate.
(f) Notices. In the event that the Issuer shall take a record of the holders of its Common Shares (or other securities or interests at the time issuable upon exercise of this Warrant Certificate):
(i) for the purpose of entitling or enabling them to receive any dividend or other distribution, to vote at a meeting (or by written consent), to receive any right to subscribe for or purchase any securities or interests, or to receive any other security; or (ii) approving or enabling any reorganization or restructuring of the Issuer, any reclassification of the Common Shares or any Fundamental Change;
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then, and in each such case, the Issuer shall, to the extent legally permissible and reasonably practicable, send or cause to be sent to the Holder at least ten (10) days prior to the applicable record date or the applicable expected effective date, as the case may be, for the event, a written notice specifying, as the case may be, (A) the record date for such dividend, distribution, meeting or consent or other right or action, and a description of such dividend, distribution or other right or action to be taken at such meeting or by written consent, or (B) the effective date on which such Fundamental Change is proposed to take place, and the date, if any is to be fixed, as of which the books of the Issuer shall close or a record shall be taken with respect to which the holders of record of Common Shares (or such other securities or interests at the time issuable upon exercise of this Warrant Certificate) shall be entitled to exchange their Common Shares (or such other securities or interests) for securities, interests or other property deliverable upon such Fundamental Change, and the amount per equity security or equivalent interest and character of such exchange applicable to this Warrant Certificate and the Warrant Securities.
Section 5. Purchase Rights. In addition to any adjustments pursuant to Section 4, if at any time the Issuer grants the right to purchase, or otherwise issues or sells any Common Shares, Options, Convertible Securities or rights to purchase securities, interests or other property pro rata to the record holders of Common Shares (the “Purchase Rights”), then the Holder shall be entitled (but not required) to acquire, upon the same terms applicable to the record holders of Common Shares, the aggregate Purchase Rights which the Holder would have acquired if the Holder had held the number of Warrant Securities acquirable upon complete exercise of this Warrant Certificate immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Common Shares are to be determined for the grant, issue or sale of such Purchase Rights.
Section 6. [Reserved]
Section 7. Warrant Register. The Issuer shall keep and properly maintain (or cause to be kept and maintained, including through a Transfer Agent) a register (the “Warrant Register”) for the registration of this Warrant Certificate and any transfers thereof. The Issuer may deem and treat the Person in whose name this Warrant Certificate is registered on such register as the holder thereof for all purposes, and the Issuer shall not be affected by any notice to the contrary, except any assignment, division, combination or other transfer of this Warrant Certificate effected in accordance with the provisions of this Warrant Certificate.
Section 8. Transfer of Warrant Certificate and Warrant Securities.
(a) Subject to the final sentence of this Section 8(a) and to the extent the Unrestricted Conditions are satisfied, this Warrant Certificate and all rights hereunder are transferable, in whole or in part, by the Holder without the prior consent of any other Person. Any transfer of this Warrant Certificate and the rights hereunder shall be made without charge to the Holder, upon surrender of this Warrant Certificate to the Issuer at its then registered office with a properly completed and duly executed Assignment in the form attached hereto as Exhibit B. Upon such compliance, surrender and delivery, the Issuer shall execute and deliver a new Warrant Certificate or Warrant Certificates in the name of the assignee or assignees and in the denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant Certificate evidencing the portion of this Warrant Certificate, if any, not so assigned and this Warrant Certificate shall promptly be cancelled.
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For the avoidance of doubt, nothing in this Section 8(a) shall limit the restrictions on transfer set forth in the Registration Agreement, including the lock up agreements applicable to the Warrant Securities contemplated in Section 4 of the Registration Agreement.
(b) [Reserved].
(c) In connection with any transfer of this Warrant Certificate, and in addition to any other applicable requirements of this Section 8, Holder will give the Issuer notice of the portion of this Warrant Certificate being transferred with the name, address and taxpayer identification number of the transferee and Holder will surrender this Warrant Certificate to the Issuer for reissuance to the transferee(s) (and Holder if applicable); and provided further, that any subsequent transferee shall agree in writing with the Issuer to be bound by all of the terms and conditions of this Warrant Certificate.
Section 9. The Holder Not Deemed an Equity Holder; Limitations on Liability; Information Rights. Except as otherwise specifically provided herein, prior to the issuance to the Holder of the Warrant Securities to which the Holder is then entitled to receive upon the due exercise of this Warrant Certificate, the Holder shall not be entitled to vote or receive dividends or be deemed the holder of Common Shares of the Issuer or otherwise have any rights as a holder of Common Shares for any purpose, nor shall anything contained in this Warrant Certificate be construed to confer upon the Holder, as such, any of the rights of an equity holder of the Issuer or any right to vote, give or withhold consent to any action (whether any reorganization, issuance of securities, reclassification of securities, consolidation, amalgamation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise. In addition, nothing contained in this Warrant Certificate shall be construed as imposing any liabilities on the Holder to purchase any securities or interests (upon exercise of this Warrant Certificate or otherwise) or as an equity holder of the Issuer, whether such liabilities are asserted by the Issuer or by creditors of the Issuer. Notwithstanding this Section 9, the Issuer shall promptly provide the Holder with copies of any notices or other information provided to the Issuer’s shareholders that are not otherwise made publicly available. To the extent that the Holder is or becomes aware of any breach by the Issuer of the provisions of this Section 9, the Holder shall provide the Issuer with prompt written notice thereof and the Issuer shall be afforded a commercially reasonable period of time to cure such breach. This Section 9 shall survive the exercise of this Warrant Certificate for so long as the Holder holds any Warrant Securities.
Section 10. Replacement on Loss; Division and Combination.
(a) Replacement of Warrant Certificate on Loss. Upon receipt of evidence reasonably satisfactory to the Issuer of the loss, theft, destruction or mutilation of this Warrant Certificate and upon delivery of an indemnity reasonably satisfactory to the Issuer (it being understood that a written indemnification agreement or affidavit of loss of the Holder shall be a sufficient indemnity) and, in case of mutilation, upon surrender of such Warrant Certificate for cancellation to the Issuer, the Issuer (at the Holder’s expense) shall execute and deliver to the Holder, in lieu hereof, a new Warrant Certificate of like tenor and exercisable for an equivalent number of Warrant Securities as this Warrant Certificate so lost, stolen, mutilated or destroyed; provided that, in the case of mutilation, no indemnity shall be required if this Warrant Certificate in identifiable form is surrendered to the Issuer for cancellation.
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(b) Division and Combination of Warrant Certificate. Subject to compliance with the applicable provisions of this Warrant Certificate as to any transfer or other assignment which may be involved in such division or combination, this Warrant Certificate may be divided or, following any such division of this Warrant Certificate, subsequently combined with other Warrant Certificates, upon the surrender of this Warrant Certificate or Warrant Certificates to the Issuer at its then registered office, together with a written notice specifying the names and denominations in which new Warrant Certificates are to be issued, signed by the respective Holders or their agents or attorneys. Subject to compliance with the applicable provisions of this Warrant Certificate as to any transfer or assignment which may be involved in such division or combination, the Issuer shall at its expense execute and deliver a new Warrant Certificate or Warrant Certificates in exchange for this Warrant Certificate or Warrant Certificates so surrendered in accordance with such notice. Such new Warrant Certificate or Warrant Certificates shall be of like tenor to the surrendered Warrant Certificate or Warrant Certificates and shall be exercisable in the aggregate for an equivalent number of Warrant Securities as this Warrant Certificate or Warrant Certificates so surrendered in accordance with such notice.
Section 11. No Impairment. The Issuer shall not, by amendment of any of its organizational documents, through any securityholder, voting or similar agreement, or through any reorganization, restructuring, transfer of assets, consolidation, amalgamation, merger, dissolution, issue or sale of securities or interests, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed by it hereunder, but shall at all times in good faith assist in the carrying out of all the provisions of this Warrant Certificate and in the taking of all such action as may reasonably be requested by the Holder in order to protect the exercise rights of the Holder against dilution or other impairment, consistent with the tenor and purpose of this Warrant Certificate.
Section 12. Compliance with the Securities Act.
(a) Agreement to Comply with the Securities Act, etc.
(i) Legend. The Holder, by acceptance of this Warrant Certificate, agrees to comply in all respects with the provisions of this Section 12 and the restrictive legend requirements set forth on the face of this Warrant Certificate and further agrees that such Holder shall not offer, sell or otherwise dispose of this Warrant Certificate or any Warrant Securities to be issued upon exercise hereof except under circumstances that will not result in a violation of the Securities Act. Subject to clause (ii) below, this Warrant Certificate and all Warrant Securities issued upon exercise of this Warrant Certificate (unless registered under the Securities Act) may be stamped or imprinted with a legend in substantially the following form:
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“THIS WARRANT CERTIFICATE AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE ”ACT“), OR QUALIFIED UNDER ANY STATE OR FOREIGN SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED OR ASSIGNED UNLESS (I) A REGISTRATION STATEMENT COVERING SUCH SECURITIES IS EFFECTIVE UNDER THE ACT AND IS QUALIFIED UNDER APPLICABLE STATE AND FOREIGN LAW OR (II) THE TRANSACTION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS UNDER THE ACT AND THE QUALIFICATION REQUIREMENTS UNDER APPLICABLE STATE AND FOREIGN LAW AND, IF THE ISSUER REQUESTS, AN OPINION SATISFACTORY TO THE ISSUER TO SUCH EFFECT HAS BEEN RENDERED BY COUNSEL. THIS WARRANT CERTIFICATE AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE FOR A PERIOD OF 180 DAYS FOLLOWING MARCH 7, 2025 PURSUANT TO A LOCK-UP AGREEMENT, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER.”
(ii) Removal of Restrictive Legends. To the extent this Warrant Certificate and the Warrant Securities or any other equity securities issuable or deliverable under or in connection with this Warrant Certificate are not then subject to any restrictions on transferability and resale pursuant to any lock-up agreement, neither this Warrant Certificate nor any book-entry position or certificate, as applicable, evidencing Warrant Securities or any other equity securities issuable or deliverable under or in connection with this Warrant Certificate shall contain any legend restricting the transfer thereof (including the legend set forth above in clause (i)) in any of the following circumstances: (A) while a registration statement covering the sale or resale of Warrant Securities is effective under the Securities Act, (B) following any sale of this Warrant Certificate, any Warrant Securities issued or delivered to the Holder under or in connection here with pursuant to Rule 144, (C) if this Warrant Certificate or Warrant Securities are eligible for sale under Rule 144(b)(1), or (D) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the SEC) (collectively, the “Unrestricted Conditions”). The Issuer shall cause its counsel to issue a legal opinion to the Transfer Agent if required by such Transfer Agent to effect the issuance of Warrant Securities or any other equity securities issuable or deliverable under or in connection with this Warrant Certificate, as applicable, without a restrictive legend or removal of the legend hereunder. If the Unrestricted Conditions are met at the time of issuance of this Warrant Certificate, the Warrant Securities or such other equity securities, then this Warrant Certificate, Warrant Securities or other equity securities, as the case may be, shall be issued free of all legends.
(iii) Replacement Warrant Certificate. The Issuer agrees that at such time as the Unrestricted Conditions have been satisfied it shall promptly (but in any event within five (5) Business Days) following written request from the Holder issue a replacement Warrant Certificate or replacement Warrant Securities, as the case may be, free of all restrictive legends.
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(iv) Sale of Unlegended Securities. The Holder agrees that the removal of the restrictive legend from this Warrant Certificate and any book-entry position or certificates, as applicable, representing securities as set forth in Section 12(a)(ii) above is predicated upon the Issuer’s reliance that the Holder will sell this Warrant Certificate or any such securities pursuant to either an effective registration statement or otherwise pursuant to the requirements of the Securities Act, including any applicable prospectus delivery requirements, or an exemption therefrom, and that if such securities are sold pursuant to a registration statement, they will be sold in compliance with the plan of distribution set forth therein.
(b) Representations of the Holder. In connection with the issuance of this Warrant Certificate, the Holder specifically represents, as of the date hereof, to the Issuer by acceptance of this Warrant Certificate as follows:
(i) The Holder is an “accredited investor” as defined in Rule 501 of Regulation D promulgated under the Securities Act. The Holder is acquiring this Warrant Certificate and the Warrant Securities to be issued upon exercise hereof for investment for its own account and not with a view towards, or for resale in connection with, the public sale or distribution of this Warrant Certificate or the Warrant Securities, except pursuant to sales registered or exempted under the Securities Act and otherwise permitted pursuant to this Warrant Certificate.
(ii) The Holder understands and acknowledges that this Warrant Certificate and the Warrant Securities to be issued upon exercise hereof are “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Issuer in a transaction not involving a public offering and that, under such laws and applicable regulations, such securities may be resold without registration under the Securities Act only in certain limited circumstances. In addition, the Holder represents that it is familiar with Rule 144 under the Securities Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.
(iii) The Holder acknowledges that it can bear the economic and financial risk of its investment for an indefinite period, and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in this Warrant Certificate and the Warrant Securities. The Holder has had an opportunity to ask questions and receive answers from the Issuer regarding the terms and conditions of the offering of this Warrant Certificate and the business, properties, prospects and financial condition of the Issuer.
Section 13. [Reserved].
Section 14. Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by e-mail of a PDF document (with confirmation of transmission) if sent on a Business Day during or before normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient or on a day that is not a Business Day; or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the addresses indicated below (or at such other address for a party as shall be specified in a notice given in accordance with this Section 14).
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If to the Issuer: | Kestra Medical Technologies, Ltd. 3933 Lake Washington Blvd NE, Suite 200 Kirkland, Washington 98033 Attention: [***] Email: [***] |
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With a copy to: | Kirkland & Ellis LLP 333 West Wolf Point Plaza Chicago, Illinois 60654 Attention: [***] Email: [***] |
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If to the Holder: | Perceptive Credit Holdings IV, LP c/o Perceptive Advisors LLC 51 Astor Place, 10th Floor New York, NY 10003 Attention: [***] E-mail: [***] |
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with a copy to: | Chapman and Cutler LLP 1270 Avenue of the Americas New York, NY 10020 Attention: [***] |
Section 15. Cumulative Remedies. The rights and remedies provided in this Warrant Certificate are cumulative and are not exclusive of, and are in addition to and not in substitution for, any other rights or remedies available at law, in equity or otherwise.
Section 16. Equitable Relief. Each of the Issuer and the Holder acknowledges that a breach or threatened breach by such party of any of its obligations under this Warrant Certificate may give rise to irreparable harm to the other party hereto for which monetary damages would not be an adequate remedy and hereby agrees that in the event of a breach or a threatened breach by such party of any such obligations, the other party hereto shall, in addition to any and all other rights and remedies that may be available to it in respect of such breach, be entitled to seek equitable relief, including a restraining order, an injunction, specific performance and any other relief that may be available from a court of competent jurisdiction.
Section 17. Entire Agreement. This Warrant Certificate constitutes the sole and entire agreement of the parties to this Warrant Certificate with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter.
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Section 18. Successor and Assigns. This Warrant Certificate and the rights evidenced hereby shall be binding upon and shall inure to the benefit of the parties hereto and the successors of the Issuer and the successors and permitted assigns of the Holder. Such successors and/or permitted assigns of the Holder shall be deemed to be a “Holder” for all purposes hereunder.
Section 19. No Third-Party Beneficiaries. This Warrant Certificate is for the sole benefit of the Issuer and the Holder and their respective successors and, in the case of the Holder, permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit or remedy of any nature whatsoever, under or by reason of this Warrant Certificate.
Section 20. Headings. The headings in this Warrant Certificate are for reference only and shall not affect the interpretation of this Warrant Certificate.
Section 21. Amendment and Modification; Waiver. Except as otherwise provided herein, this Warrant Certificate may only be amended, modified or supplemented by an agreement in writing signed by each party hereto. No waiver by the Issuer or the Holder of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Warrant Certificate shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.
Section 22. Severability. If any term or provision of this Warrant Certificate is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Warrant Certificate or invalidate or render unenforceable such term or provision in any other jurisdiction.
Section 23. Governing Law. This Warrant Certificate shall be governed by and construed in accordance with the internal laws of the State of New York without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of New York.
Section 24. Submission to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Warrant Certificate or the transactions contemplated hereby may be instituted in the federal courts of the United States of America or the courts of the State of New York in each case located in the city of New York and County of New York, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding. Service of process, summons, notice or other document by certified or registered mail to such party’s address set forth herein shall be effective service of process for any suit, action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or any proceeding in such courts and irrevocably waive and agree not to plead or claim in any such court that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.
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Section 25. Waiver of Jury Trial. EACH OF THE ISSUER AND THE HOLDER ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS WARRANT CERTIFICATE IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS WARRANT CERTIFICATE OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 26. Counterparts. This Warrant Certificate may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Warrant Certificate delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Warrant Certificate.
Section 27. No Strict Construction. This Warrant Certificate shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Issuer has duly executed this Warrant Certificate on the Initial Issue Date.
KESTRA MEDICAL TECHNOLOGIES, LTD., an exempted company limited by shares incorporated in Bermuda |
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By | /s/ Brian Webster |
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Name: Brian Webster | ||
Title: President and Chief Executive Officer |
SIGNATURE PAGE
WARRANT
Accepted and agreed, | ||
PERCEPTIVE CREDIT HOLDINGS IV, LP | ||
By: | Perceptive Credit Opportunities GP, LLC, its general partner | |
By: | /s/ Sandeep Dixit |
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Name: Sandeep Dixit | ||
Title: Chief Credit Officer | ||
By: | /s/ Sam Chawla |
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Name: Sam Chawla | ||
Title: Portfolio Manager |
SIGNATURE PAGE
WARRANT
Accepted and agreed, solely for purposes of the Prior Warrant Termination: |
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WEST AFFUM HOLDINGS, L.P., an exempted limited partnership registered in the Cayman Islands |
By West Affum GP Ltd., its general partner | ||
By | /s/ Brian Webster |
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Name: | Brian Webster | |
Title: | Director |
SIGNATURE PAGE
WARRANT
Exhibit A
to Warrant Certificate
FORM OF EXERCISE CERTIFICATE
(To be signed only upon exercise of Warrant Certificate)
To: ________________
The undersigned, as holder of a right to purchase [Common Shares, par value $1.00 per share], of KESTRA MEDICAL TECHNOLOGIES, LTD., an exempted company limited by shares incorporated in Bermuda (the “Issuer”), pursuant to that certain Warrant Certificate of the Issuer, dated as of March 7, 2025 and bearing Warrant Certificate No. 2025-01 (the “Warrant Certificate”), hereby irrevocably elects to exercise the purchase right represented by such Warrant Certificate for, and to purchase thereunder, [________ (_____)] [Common Shares] of the Issuer comprising and herewith makes payment of [___________ Dollars ($________)] therefor by the following method:
(Check all that apply):
______ (check if applicable) The undersigned hereby elects to make payment of the Aggregate Exercise Price of [__________ Dollars ($_______)] for [(______)] [Common Shares] using the method described in Section 3(b)(i).
______ (check if applicable) The undersigned hereby elects to make payment of the Aggregate Exercise Price of [__________ Dollars ($_______)] for [(______)] [Common Shares] using the method described in Section 3(b)(ii).
Unless otherwise defined herein, capitalized terms have the meanings provided in the Warrant Certificate.
DATED: ______________
PERCEPTIVE CREDIT HOLDINGS IV, LP |
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By |
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Name: |
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Title: |
A-1
Exhibit B
to Warrant Certificate
FORM OF ASSIGNMENT
THE UNDERSIGNED, Perceptive Credit Holdings IV, LP, is the holder (in such capacity, the “Holder”) of a warrant certificate issued KESTRA MEDICAL TECHNOLOGIES, LTD., an exempted company limited by shares incorporated under the laws of Bermuda (the “Issuer”), bearing Warrant Certificate No. 2025-01 (the “Warrant Certificate”), entitling the Holder to purchase [Common Shares]. Unless otherwise defined, capitalized terms used herein have the meanings ascribed thereto in the Warrant Certificate.
FOR VALUE RECEIVED, the Holder hereby sells, assigns and transfers to [NAME OF ASSIGNEE] (the “Assignee”) the right to acquire [all Warrant Securities entitled to be purchased upon exercise of the Warrant Certificate] [[______] Warrant Securities entitled to be purchased upon exercise of the Warrant Certificate]. In furtherance of the foregoing assignment, the Holder hereby irrevocably instructs the Issuer to (i) memorialize such assignment on the Warrant Register as required pursuant to Section 7 of the Warrant Certificate, and (ii) pursuant to Section 8 of the Warrant Certificate, execute and deliver to the Assignee [and the Holder] [a new Warrant Certificate / new Warrant Certificates] reflecting the foregoing assignment ([each] a “Substitute Warrant Certificate”).
The Assignee acknowledges and agrees that its Substitute Warrant Certificate and the Warrant Securities to be issued upon exercise thereof are being acquired for investment and that the Assignee will not offer, sell or otherwise dispose of its Substitute Warrant Certificate or any Warrant Securities to be issued upon exercise or conversion thereof except under circumstances which will not result in a violation of the Securities Act or any applicable state securities laws or foreign securities laws. The Assignee represents and warrants for the benefit of the Issuer that the Assignee is an “accredited investor” within the meaning of Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended.
To the extent required pursuant to Section 12 of the Warrant Certificate, the Assignee acknowledges and agrees that a restrictive legend shall be applied to the Assignee’s Substitute Warrant Certificate and the Warrant Securities issuable upon exercise of such certificate substantially consistent with the legend set forth in Section 12(a)(i).
[SIGNATURE PAGE FOLLOWS]
PERCEPTIVE CREDIT HOLDINGS IV, LP |
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By |
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Name: |
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Title: |
Accepted and agreed, |
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[NAME OF ASSIGNEE] |
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By |
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Name: |
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Title: |
Exhibit 10.4
KESTRA MEDICAL TECHNOLOGIES, LTD.
2025 OMNIBUS INCENTIVE PLAN
ARTICLE I
PURPOSE
The purpose of this Kestra Medical Technologies, Ltd. 2025 Omnibus Incentive Plan (this “Plan”) is to promote the success of the Company’s business for the benefit of its stockholders by enabling the Company to offer Eligible Individuals cash and stock-based incentives in order to attract, retain, and reward such individuals and strengthen the mutuality of interests between such individuals and the Company’s stockholders. This Plan is effective as of the date set forth in Article XIV.
ARTICLE II
DEFINITIONS
For purposes of this Plan, the following terms shall have the following meanings:
2.1 “Affiliate” means a corporation or other entity controlled by, controlling, or under common control with the Company. The term “control” (including, with correlative meaning, the terms “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of management and policies of such Person, whether through the ownership of voting or other securities, by contract or otherwise.
2.2 “Applicable Law” means the requirements relating to the administration of equity-based awards and the related shares under U.S. state corporate law, U.S. federal and state securities laws, the rules or requirements of any stock exchange or quotation system on which the shares are listed or quoted, and any other applicable laws, including tax laws, of any U.S. or non-U.S. jurisdictions where Awards are, or will be, granted under this Plan.
2.3 “Award” means any award under this Plan of any Stock Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Units, Performance Award, Other Stock-Based Award, or Cash Award. All Awards shall be evidenced by and subject to the terms of an Award Agreement.
2.4 “Award Agreement” means the written or electronic agreement, contract, certificate, or other instrument or document evidencing the terms and conditions of an individual Award. Each Award Agreement shall be subject to the terms and conditions of this Plan.
2.5 “Board” means the Board of Directors of the Company.
2.6 “Cash Award” means an Award granted to an Eligible Individual pursuant to Section 9.3 of this Plan and payable in cash at such time or times and subject to such terms and conditions as determined by the Committee in its sole discretion.
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2.7 “Cause” means, unless otherwise determined by the Committee in the applicable Award Agreement, with respect to a Participant’s Termination of Service, the following: (a) in the case where there is no employment agreement, offer letter, consulting agreement, change in control agreement, or similar agreement in effect between the Company or an Affiliate and the Participant at the time of the grant of the Award (or where there is such agreement in effect but it does not define “cause” (or words of like import)), the Participant’s (i) continued failure to perform any portion of his or her duties or the Participant’s continued failure to follow the lawful directives of the Board or any executive to whom the Participant reports that are consistent with the Participant’s position in the Company, (ii) misconduct or negligence, (iii) indictment for, or conviction of, a felony (including a plea of nolo contendere), (iv) negligent performance of his or her duties, (v) breach of the terms of the Participant’s employment agreement, offer letter, or any other agreement with the Company or any of its Affiliates to which the Participant is a party, (vi) violation of the Company’s written policies regarding ethical business practices or any other violation of any written policy of the Company or any of its Affiliates, (vii) act of theft, embezzlement, fraud, or misappropriation of or in respect of the Company’s property, or (viii) continued failure to cooperate in any audit or investigation of financial or business practices of the Company, or (ix) breach of any of the restrictive covenants in any written agreement between the Participant and the Company and/or its Affiliates; or (b) in the case where there is an employment agreement, offer letter, consulting agreement, change in control agreement, or similar agreement in effect between the Company or an Affiliate and the Participant at the time of the grant of the Award that defines “cause” (or words of like import), “cause” as defined under such agreement; provided, however, that with regard to any agreement under which the definition of “cause” only applies on occurrence of a change in control, such definition of “cause” shall not apply until a change in control (as defined in such agreement) actually takes place and then only with regard to a termination thereafter.
2.8 “Change in Control” means and includes each of the following, unless otherwise determined by the Committee in the applicable Award Agreement or other written agreement with a Participant approved by the Committee:
(a) any Person (other than the Company, any trustee or other fiduciary holding securities under any employee benefit plan of the Company, or any company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of the Company), becoming the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities, excluding for purposes herein, acquisitions pursuant to a Business Combination (as defined below) that does not constitute a Change in Control as defined in Section 2.8(b);
(b) a merger, reorganization, or consolidation of the Company or in which equity securities of the Company are issued (each, a “Business Combination”), other than a merger, reorganization or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its direct or indirect parent) more than fifty percent (50%) of the combined voting power of the voting securities of the Company or such surviving entity (or, as applicable, a direct or indirect parent of the Company or such surviving entity) outstanding immediately after such merger, reorganization or consolidation; provided, however, that a merger, reorganization or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person (other than those covered by the exceptions in Section 2.8(a)) acquires more than 50% of the combined voting power of the Company’s then outstanding securities shall not constitute a Change in Control; (c) during the period of two (2) consecutive years, individuals who, at the beginning of such period, constitute the Board together with any new director(s) (other than a director designated by a Person who has entered into an agreement with the Company to effect a transaction described in Sections 2.8(a) or (b)) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the two (2) year period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or
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(d) a complete liquidation or dissolution of the Company or the consummation of a sale or disposition by the Company of all or substantially all of the Company’s assets other than the sale or disposition of all or substantially all of the assets of the Company to a Person or Persons who beneficially own, directly or indirectly, fifty percent (50%) or more of the combined voting power of the outstanding voting securities of the Company at the time of the sale.
For purposes of this Section 2.8, acquisitions of securities of the Company by Bain Capital, LP, any of its respective affiliates, or any investment vehicle or fund controlled by or managed by, or otherwise affiliated with Bain Capital, LP shall not constitute a Change in Control. Notwithstanding the foregoing, with respect to any Award that is characterized as “nonqualified deferred compensation” within the meaning of Section 409A of the Code, an event shall not be considered to be a Change in Control under this Plan for purposes of payment of such Award unless such event is also a “change in ownership,” a “change in effective control,” or a “change in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A of the Code.
2.9 “Change in Control Price” means the highest price per Share paid in any transaction related to a Change in Control as determined by the Committee in its discretion.
2.10 “Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time. Any reference to any section of the Code shall also be a reference to any successor provision and any guidance and treasury regulation promulgated thereunder.
2.11 “Committee” means any committee of the Board duly authorized by the Board to administer this Plan; provided, however, that unless otherwise determined by the Board, the Committee shall consist solely of two or more members of the Board who are each (a) a “non-employee director” within the meaning of Rule 16b-3(b), and (b) “independent” under the listing standards or rules of the securities exchange upon which the Common Stock is traded, but only to the extent such independence is required in order to take the action at issue pursuant to such standards or rules. If no committee is duly authorized by the Board to administer this Plan, the term “Committee” shall be deemed to refer to the Board for all purposes under this Plan. The Board may abolish any Committee or re-vest in itself any previously delegated authority from time to time and will retain the right to exercise the authority of the Committee to the extent consistent with Applicable Law.
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2.12 “Common Stock” means the common shares, $1.00 par value per share, of the Company.
2.13 “Company” means Kestra Medical Technologies, Ltd., a Bermuda corporation, and its successors by operation of law.
2.14 “Consultant” means any natural person who is an advisor or consultant or other service provider to the Company or any of its Affiliates.
2.15 “Disability” means, unless otherwise determined by the Committee in the applicable Award Agreement, with respect to a Participant’s Termination of Service, that the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment, after accounting for reasonable accommodations (if applicable and required by Applicable Law); provided, however, for purposes of an Incentive Stock Option, the term Disability shall have the meaning ascribed to it under Section 22(e)(3) of the Code. The determination of whether an individual has a Disability shall be determined by the Committee, and the Committee may rely on any determination that a Participant is disabled for purposes of benefits under any long-term disability plan in which a Participant participates that is maintained by the Company or any Affiliate.
2.16 “Dividend Equivalent Rights” means a right granted to a Participant under this Plan to receive the equivalent value (in cash or Shares) of dividends paid on Shares.
2.17 “Effective Date” means the effective date of this Plan as defined in Article XIV.
2.18 “Eligible Employee” means each employee of the Company or any of its Affiliates. An employee on a leave of absence and any former employee may be an Eligible Employee.
2.19 “Eligible Individual” means an Eligible Employee, Non-Employee Director, or Consultant who is designated by the Committee in its discretion as eligible to receive Awards subject to the terms and conditions set forth herein.
2.20 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time. Reference to a specific section of the Exchange Act or regulation thereunder shall include such section or regulation, any valid regulation or interpretation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing, or superseding such section or regulation.
2.21 “Fair Market Value” means, for purposes of this Plan, unless otherwise required by any applicable provision of the Code or any regulations issued thereunder, as of any date and except as provided below, the last sales price reported for the Common Stock on the applicable date: (a) as reported on the principal national securities exchange in the United States on which it is then traded, listed or otherwise reported or quoted or (b) if the Common Stock is not traded, listed, or otherwise reported or quoted, the Committee shall determine in good faith the Fair Market Value in whatever manner it considers appropriate, taking into account the requirements of Section 409A of the Code. For purposes of the grant of any Award, the applicable date shall be the trading day immediately prior to the date on which the Award is granted. For purposes of the exercise of any Award, the applicable date shall be the date a notice of exercise is received by the Committee or, if not a date on which the applicable market is open, the next day that it is open. Notwithstanding the foregoing, with respect to any Award granted on the pricing date of the Company’s initial public offering, the Fair Market Value shall mean the initial public offering price of a Share as set forth in the Company’s final prospectus relating to its initial public offering filed with the Securities and Exchange Commission.
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2.22 “Family Member” means “family member” as defined in Section A.1.(a)(5) of the general instructions of Form S-8.
2.23 “Incentive Stock Option” means any Stock Option granted to an Eligible Employee who is an employee of the Company, its Parents or its Subsidiaries under this Plan and that is intended to be, and is designated as, an “Incentive Stock Option” within the meaning of Section 422 of the Code.
2.24 “Non-Employee Director” means a director on the Board who is not an employee of the Company.
2.25 “Non-Qualified Stock Option” means any Stock Option granted under this Plan that is not an Incentive Stock Option.
2.26 “Other Stock-Based Award” means an Award granted under Article IX of this Plan that is valued in whole or in part by reference to, or is payable in or otherwise based on, Shares, but may be settled in the form of Shares or cash.
2.27 “Parent” means any parent corporation of the Company within the meaning of Section 424(e) of the Code.
2.28 “Participant” means an Eligible Individual to whom an Award has been granted pursuant to this Plan.
2.29 “Performance Award” means an Award granted under Article VIII of this Plan.
2.30 “Performance Goals” means goals established by the Committee as contingencies for Awards to vest and/or become exercisable or distributable.
2.31 “Performance Period” means the designated period during which the Performance Goals must be satisfied with respect to the Award to which the Performance Goals relate.
2.32 “Person” means any “person” as such term is used in Sections 13(d) and 14(d) of the Exchange Act.
2.33 “Restricted Stock” means an Award of Shares granted under Article VII of this Plan.
2.34 “Restricted Stock Unit” means an unfunded, unsecured right to receive, on the applicable settlement date, one Share or an amount in cash or other consideration determined by the Committee to be of equal value as of such settlement date, subject to certain vesting conditions and other restrictions.
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2.35 “Rule 16b-3” means Rule 16b-3 under Section 16(b) of the Exchange Act as then in effect or any successor provision.
2.36 “Section 409A of the Code” means the nonqualified deferred compensation rules under Section 409A of the Code and any applicable treasury regulations and other official guidance thereunder.
2.37 “Securities Act” means the Securities Act of 1933, as amended, and all rules and regulations promulgated thereunder. Reference to a specific section of the Securities Act or regulation thereunder shall include such section or regulation, any valid regulation or interpretation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing, or superseding such section or regulation.
2.38 “Shares” means shares of Common Stock.
2.39 “Stock Appreciation Right” means a stock appreciation right granted under Article VI of this Plan.
2.40 “Stock Option” or “Option” means any option to purchase Shares granted pursuant to Article VI of this Plan.
2.41 “Subsidiary” means any subsidiary corporation of the Company within the meaning of Section 424(f) of the Code.
2.42 “Ten Percent Stockholder” means a Person owning stock representing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company, its Parent, or its Subsidiaries.
2.43 “Termination of Service” means the termination of the applicable Participant’s employment with, or performance of services for, the Company and its Affiliates. Unless otherwise determined by the Committee, (a) if a Participant’s employment or services with the Company and its Affiliates terminates but such Participant continues to provide services to the Company and its Affiliates in a non-employee capacity, such change in status shall not be deemed a Termination of Service with the Company and its Affiliates and (b) a Participant employed by, or performing services for an Affiliate that ceases to be an Affiliate shall also be deemed to have incurred a Termination of Service provided the Participant does not immediately thereafter become an employee of the Company or another Affiliate. Notwithstanding the foregoing provisions of this definition, with respect to any Award that constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code, a Participant shall not be considered to have experienced a “Termination of Service” unless the Participant has experienced a “separation from service” within the meaning of Section 409A of the Code.
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ARTICLE III
ADMINISTRATION
3.1 Authority of the Committee. This Plan shall be administered by the Committee. Subject to the terms of this Plan and Applicable Law, the Committee shall have full authority to grant Awards to Eligible Individuals under this Plan. In particular, the Committee shall have the authority to:
(a) determine whether and to what extent Awards, or any combination thereof, are to be granted hereunder to one or more Eligible Individuals;
(b) determine the number of Shares to be covered by each Award granted hereunder;
(c) determine the terms and conditions, not inconsistent with the terms of this Plan, of any Award granted hereunder (including, but not limited to, the exercise or purchase price (if any), any restriction or limitation, any vesting schedule or acceleration thereof, or any forfeiture restrictions or waiver thereof, regarding any Award and the Shares, if any, relating thereto, based on such factors, if any, as the Committee shall determine, in its sole discretion);
(d) determine the amount of cash to be covered by each Award granted hereunder;
(e) determine whether, to what extent, and under what circumstances grants of Options and other Awards under this Plan are to operate on a tandem basis and/or in conjunction with or apart from other awards made by the Company outside of this Plan;
(f) determine whether and under what circumstances an Award may be settled in cash, Shares, other property, or a combination of the foregoing;
(g) determine whether, to what extent and under what circumstances cash, Shares, or other property and other amounts payable with respect to an Award under this Plan shall be deferred either automatically or at the election of the Participant;
(h) modify, waive, amend, or adjust the terms and conditions of any Award, at any time or from time to time, including but not limited to Performance Goals;
(i) determine whether a Stock Option is an Incentive Stock Option or Non-Qualified Stock Option;
(j) determine whether to require a Participant, as a condition of the granting of any Award, to not sell or otherwise dispose of Shares acquired pursuant to the exercise or vesting of an Award for a period of time as determined by the Committee, in its sole discretion, following the date of the acquisition of such Award or Shares;
(k) modify, extend, or renew an Award, subject to Article XI and Section 6.8(g) of this Plan; and
(l) determine how the Disability, death, retirement, authorized leave of absence or any other change or purported change in a Participant’s status affects an Award and the extent to which, and the period during which, the Participant, the Participant’s legal representative, conservator, guardian or beneficiary may exercise rights under the Award, if applicable.
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3.2 Guidelines. Subject to Article XI of this Plan, the Committee shall have the authority to adopt, alter, and repeal such administrative rules, guidelines, and practices governing this Plan and perform all acts, including the delegation of its responsibilities (to the extent permitted by Applicable Law and applicable stock exchange rules), as it shall, from time to time, deem advisable; to construe and interpret the terms and provisions of this Plan and any Award issued under this Plan (and any agreements or sub-plans relating thereto); and to otherwise supervise the administration of this Plan. The Committee may correct any defect, supply any omission, or reconcile any inconsistency in this Plan or in any agreement relating thereto in the manner and to the extent it shall deem necessary to effectuate the purpose and intent of this Plan. The Committee may adopt special rules, sub-plans, guidelines, and provisions for persons who are residing in or employed in, or subject to, the taxes of any domestic or foreign jurisdictions to satisfy or accommodate applicable foreign laws or to qualify for preferred tax treatment of such domestic or foreign jurisdictions.
3.3 Decisions Final. Any decision, interpretation, or other action made or taken in good faith by or at the direction of the Company, the Board, or the Committee (or any of its members) arising out of or in connection with this Plan shall be within the absolute discretion of all and each of them, as the case may be, and shall be final, binding, and conclusive on the Company and all employees and Participants and their respective heirs, executors, administrators, successors, and assigns.
3.4 Designation of Consultants/Liability; Delegation of Authority.
(a) The Committee may employ such legal counsel, consultants, and agents as it may deem desirable for the administration of this Plan and may rely upon any opinion received from any such counsel or consultant and any computation received from any such consultant or agent. Expenses incurred by the Committee or the Board in the engagement of any such counsel, consultant, or agent shall be paid by the Company. The Committee, its members, and any person designated pursuant to this Section 3.4 shall not be liable for any action or determination made in good faith with respect to this Plan. To the maximum extent permitted by Applicable Law, no officer of the Company or member or former member of the Committee or of the Board shall be liable for any action or determination made in good faith with respect to this Plan or any Award granted under it.
(b) The Committee may delegate any or all of its powers and duties under this Plan to a subcommittee of directors or to any officer of the Company, including the power to perform administrative functions (including executing agreements or other documents on behalf of the Committee) and grant Awards; provided, that such delegation does not (i) violate Applicable Law, or (ii) result in the loss of an exemption under Rule 16b-3(d)(1) for Awards granted to Participants subject to Section 16 of the Exchange Act in respect of the Company. Upon any such delegation, all references in this Plan to the “Committee,” shall be deemed to include any subcommittee or officer of the Company to whom such powers have been delegated by the Committee. Any such delegation shall not limit the right of such subcommittee members or such an officer to receive Awards; provided, however, that such subcommittee members and any such officer may not grant Awards to himself or herself, a member of the Board, or any executive officer of the Company or an Affiliate, or take any action with respect to any Award previously granted to himself or herself, a member of the Board, or any executive officer of the Company or an Affiliate. The Committee may also designate employees or professional advisors who are not executive officers of the Company or members of the Board to assist in administering this Plan, provided, however, that such individuals may not be delegated the authority to grant or modify any Awards that will, or may, be settled in Shares.
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3.5 Indemnification. To the maximum extent permitted by Applicable Law and to the extent not covered by insurance directly insuring such person, each current and former officer or employee of the Company or any of its Affiliates and member or former member of the Committee or the Board shall be indemnified and held harmless by the Company against any cost or expense (including reasonable fees of counsel acceptable to the Committee) or liability (including any sum paid in settlement of a claim with the approval of the Committee), and advanced amounts necessary to pay the foregoing at the earliest time and to the fullest extent permitted, arising out of any act or omission to act in connection with the administration of this Plan, except to the extent arising out of such officer’s, employee’s, member’s, or former member’s own fraud or bad faith. Such indemnification shall be in addition to any right of indemnification that the current or former employee, officer or member may have under Applicable Law or under the by-laws of the Company or any of its Affiliates. Notwithstanding anything else herein, this indemnification will not apply to the actions or determinations made by an individual with regard to Awards granted to such individual under this Plan.
ARTICLE IV
SHARE LIMITATION
4.1 Shares. The aggregate number of Shares that may be issued pursuant to this Plan shall not exceed 12,890,000 Shares (subject to any increase or decrease pursuant to this Article IV), which may be either authorized and unissued Shares or Shares held in or acquired for the treasury of the Company or both. The number of Shares that may be issued pursuant to this Plan shall be subject to an annual increase on January 1 of each calendar year beginning in January 1, 2026, and ending and including December 31, 2036, equal to the lesser of (a) 5% of the aggregate number of Shares outstanding on December 31 of the immediately preceding calendar year and (b) such smaller number of Shares as is determined by the Board. The aggregate number of Shares that may be issued or used with respect to any Incentive Stock Option shall not exceed 12,890,000 Shares (subject to any increase or decrease pursuant to Section 4.3). Any Award under this Plan settled in cash shall not be counted against the foregoing maximum share limitations. Notwithstanding anything to the contrary contained herein, Shares subject to an Award under this Plan shall again be made available for issuance or delivery under this Plan if such Shares are (i) Shares delivered, withheld or surrendered in payment of the exercise or purchase price of an Award, (ii) Shares delivered, withheld, or surrendered to satisfy any tax withholding obligation or (iii) Shares subject to a stock-settled Award that expires or is canceled, forfeited, or terminated without issuance of the full number of Shares to which the Award related.
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4.2 Substitute Awards. In connection with an entity’s merger or consolidation with the Company or the Company’s acquisition of an entity’s property or stock, the Committee may grant Awards in substitution for any options or other stock or stock-based awards granted before such merger or consolidation by such entity or its affiliate (“Substitute Awards”). Substitute Awards may be granted on such terms as the Committee deems appropriate, notwithstanding limitations on Awards in this Plan. Substitute Awards will not count against the Shares authorized for grant under this Plan (nor shall Shares subject to a Substitute Award be added to the Shares available for Awards under this Plan as provided under Section 4.1 above), except that Shares acquired by exercise of substitute Incentive Stock Options will count against the maximum number of Shares that may be issued pursuant to the exercise of Incentive Stock Options under this Plan, as set forth in Section 4.1 above. Additionally, in the event that a Person acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines has shares available under a pre-existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grants pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under this Plan and shall not reduce the Shares authorized for grant under this Plan (and Shares subject to such Awards shall not be added to the Shares available for Awards under this Plan as provided under Section 4.1 above); provided that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not Eligible Employees or Non-Employee Directors prior to such acquisition or combination.
4.3 Adjustments.
(a) The existence of this Plan and the Awards granted hereunder shall not affect in any way the right or power of the Board or the stockholders of the Company to make or authorize (i) any adjustment, recapitalization, reorganization, or other change in the Company’s capital structure or its business, (ii) any merger or consolidation of the Company or any Affiliate, (iii) any issuance of bonds, debentures, or preferred or prior preference stock ahead of or affecting the Shares, (iv) the dissolution or liquidation of the Company or any Affiliate, (v) any sale or transfer of all or part of the assets or business of the Company or any Affiliate, or (vi) any other corporate act or proceeding.
(b) Subject to the provisions of Section 10.1:
(i) If the Company at any time subdivides (by any split, recapitalization or otherwise) the outstanding Shares into a greater number of Shares, or combines (by reverse split, combination, or otherwise) its outstanding Shares into a lesser number of Shares, then the respective exercise prices for outstanding Awards that provide for a Participant-elected exercise and the number of Shares covered by outstanding Awards shall be appropriately adjusted by the Committee to prevent dilution or enlargement of the rights granted to, or available for, Participants under this Plan; provided, that the Committee in its sole discretion shall determine whether an adjustment is appropriate.
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(ii) Excepting transactions covered by Section 4.3(b)(i), if the Company effects any merger, consolidation, statutory exchange, spin-off, reorganization, sale or transfer of all or substantially all the Company’s assets or business, or other corporate transaction or event in such a manner that the Company’s outstanding Shares are converted into the right to receive (or the holders of Common Stock are entitled to receive in exchange therefor), either immediately or upon liquidation of the Company, securities or other property of the Company or other entity, then, subject to the provisions of Section 10.1, (A) the aggregate number or kind of securities that thereafter may be issued under this Plan, (B) the number or kind of securities or other property (including cash) to be issued pursuant to Awards granted under this Plan (including as a result of the assumption of this Plan and the obligations hereunder by a successor entity, as applicable), or (C) the exercise or purchase price thereof, shall be appropriately adjusted by the Committee to prevent dilution or enlargement of the rights granted to, or available for, Participants under this Plan.
(iii) If there shall occur any change in the capital structure of the Company other than those covered by Sections 4.3(b)(i) or 4.3(b)(ii), any conversion, any adjustment, or any issuance of any class of securities convertible or exercisable into, or exercisable for, any class of equity securities of the Company, then the Committee shall adjust any Award and make such other adjustments to this Plan to prevent dilution or enlargement of the rights granted to, or available for, Participants under this Plan.
(iv) In the event of any pending stock dividend, stock split, combination or exchange of shares, merger, consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other extraordinary transaction or change affecting the Shares or the Share price, including any securities offering or other similar transaction, for administrative convenience, the Committee may refuse to permit the exercise of any Award for up to sixty (60) days before or after such transaction.
(v) The Committee may adjust the Performance Goals applicable to any Awards to reflect any unusual or non-recurring events and other extraordinary items, impact of charges for restructurings, discontinued operations, and the cumulative effects of accounting or tax changes, each as defined by generally accepted accounting principles or as identified in the Company’s financial statements, notes to the financial statements, management’s discussion and analysis, or other Company public filing.
(vi) Any such adjustment determined by the Committee pursuant to this Section 4.3(b) shall be final, binding, and conclusive on the Company and all Participants and their respective heirs, executors, administrators, successors, and permitted assigns. Any adjustment to, or assumption or substitution of, an Award under this Section 4.3(b) shall be intended to comply with the requirements of Section 409A of the Code and Treasury Regulation §1.424-1 (and any amendments thereto), to the extent applicable. Except as expressly provided in this Section 4.3 or in the applicable Award Agreement, a Participant shall have no additional rights under this Plan by reason of any transaction or event described in this Section 4.3.
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4.4 Annual Limit on Non-Employee Director Compensation. In each calendar year during any part of which this Plan is in effect, a Non-Employee Director may not receive for such individual’s service on the Board compensation (in any combination of Awards and cash) that have a value in excess of $750,000 (calculating the value of any such Awards based on the grant date fair value of such Awards for financial reporting purposes); provided, that (a) the Committee may make exceptions to this limit, except that the Non-Employee Director receiving such additional compensation may not participate in the decision to award such compensation or in other contemporaneous decisions involving compensation for Non-Employee Directors and (b) for any calendar year in which a Non-Employee Director first commences service on the Board, such limit shall be increased to $1,000,000; provided, further, that the limit set forth in this Section 4.4 shall be applied without regard to Awards or other compensation, if any, provided to a Non-Employee Director during any period in which such individual was an employee of the Company or any Affiliate or was otherwise providing services to the Company or to any Affiliate other than in the capacity as a Non-Employee Director.
ARTICLE V
ELIGIBILITY
5.1 General Eligibility. All current and prospective Eligible Individuals are eligible to be granted Awards. Eligibility for the grant of Awards and actual participation in this Plan shall be determined by the Committee in its sole discretion. No Eligible Individual will automatically be granted any Award under this Plan.
5.2 Incentive Stock Options. Notwithstanding the foregoing, only Eligible Employees who are employees of the Company, its Parents, or its Subsidiaries are eligible to be granted Incentive Stock Options under this Plan. Eligibility for the grant of an Incentive Stock Option and actual participation in this Plan shall be determined by the Committee in its sole discretion.
5.3 General Requirement. The vesting and exercise of Awards granted to a prospective Eligible Individual are conditioned upon such individual actually becoming an Eligible Employee, Consultant, or Non-Employee Director, as applicable.
ARTICLE VI
STOCK OPTIONS; STOCK APPRECIATION RIGHTS
6.1 General. Stock Options or Stock Appreciation Rights may be granted alone or in addition to other Awards granted under this Plan Each Stock Option granted under this Plan shall be of one of two types: (a) an Incentive Stock Option or (b) a Non-Qualified Stock Option. Stock Options and Stock Appreciation Rights granted under this Plan shall be evidenced by an Award Agreement and subject to the terms, conditions and limitations in this Plan, including any limitations applicable to Incentive Stock Options.
6.2 Grants. The Committee shall have the authority to grant to any Eligible Individual one or more Incentive Stock Options, Non-Qualified Stock Options, and/or Stock Appreciation Rights; provided, however, that Incentive Stock Options may only be granted to an Eligible Employee who is an employee of the Company, its Parents, or its Subsidiaries. To the extent that any Stock Option does not qualify as an Incentive Stock Option (whether because of its provisions or the time or manner of its exercise or otherwise), such Stock Option or the portion thereof which does not so qualify shall constitute a separate Non-Qualified Stock Option.
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6.3 Exercise Price. The exercise price per Share subject to a Stock Option or Stock Appreciation Right shall be determined by the Committee at the time of grant, provided that the per share exercise price of a Stock Option or Stock Appreciation Right shall not be less than 100% (or, in the case of an Incentive Stock Option granted to a Ten Percent Stockholder, 110%) of the Fair Market Value at the time of grant. Notwithstanding the foregoing, in the case of a Stock Option or Stock Appreciation Right that is a Substitute Award, the exercise price per Share for such Stock Option or Stock Appreciation Right may be less than the Fair Market Value on the date of grant; provided, that, such exercise price is determined in a manner consistent with the provisions of Section 409A of the Code and, if applicable, Section 424(a) of the Code.
6.4 Term. The term of each Stock Option or Stock Appreciation Right shall be fixed by the Committee, provided that no Stock Option or Stock Appreciation Right shall be exercisable more than ten (10) years (or, in the case of an Incentive Stock Option granted to a Ten Percent Stockholder, five (5) years) after the date on which the Stock Option or Stock Appreciation Right, as applicable, is granted.
6.5 Exercisability. Unless otherwise provided by the Committee in accordance with the provisions of this Section 6.5, Stock Options and Stock Appreciation Rights granted under this Plan shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Committee at the time of grant. The Committee may, but shall not be required to, provide for an acceleration of vesting and exercisability upon the occurrence of a specified event. Unless otherwise determined by the Committee, if the exercise of a Non-Qualified Stock Option or Stock Appreciation Right within the permitted time periods is prohibited because such exercise would violate the registration requirements under the Securities Act or any other Applicable Law or the rules of any securities exchange or interdealer quotation system, the Company’s insider trading policy (including any blackout periods) or a “lock-up” agreement entered into in connection with the issuance of securities by the Company, then the expiration of such Non-Qualified Stock Option or Stock Appreciation Right shall be extended until the date that is thirty (30) days after the end of the period during which the exercise of the Non-Qualified Stock Option or Stock Appreciation Right would be in violation of such registration requirement or other Applicable Law or rules, blackout period or lock-up agreement, as determined by the Committee; provided, however, that in no event shall any such extension result in any Non-Qualified Stock Option or Stock Appreciation Right remaining exercisable after the ten (10)-year term of the applicable Non-Qualified Stock Option or Stock Appreciation Right.
6.6 Method of Exercise. Subject to any applicable waiting period or exercisability provisions under Section 6.5, to the extent vested, Stock Options and Stock Appreciation Rights may be exercised in whole or in part at any time during the term of the applicable Stock Option or Stock Appreciation Right, by giving written notice of exercise (which may be electronic) to the Company specifying the number of Stock Options or Stock Appreciation Rights, as applicable, being exercised. Such notice shall be accompanied by payment in full of the exercise price (which shall equal the product of such number of Shares to be purchased multiplied by the applicable exercise price). The exercise price for the Stock Options may be paid upon such terms and conditions as shall be established by the Committee and set forth in the applicable Award Agreement. Without limiting the foregoing, the Committee may establish payment terms for the exercise of Stock Options pursuant to which the Company may withhold a number of Shares that otherwise would be issued to the Participant in connection with the exercise of the Stock Option having a Fair Market Value on the date of exercise equal to the exercise price, or that permit the Participant to deliver cash or Shares with a Fair Market Value equal to the exercise price on the date of payment, or through a simultaneous sale through a broker of Shares acquired on exercise, all as permitted by Applicable Law. No Shares shall be issued until payment therefor, as provided herein, has been made or provided for. Upon the exercise of a Stock Appreciation Right a Participant shall be entitled to receive, for each right exercised, up to, but no more than, an amount in cash and/or Shares (as chosen by the Committee in its sole discretion) equal in value to the excess of the Fair Market Value of one (1) Share on the date that the right is exercised over the Fair Market Value of one (1) Share on the date that the right was awarded to the Participant.
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6.7 Non-Transferability. No Stock Option or Stock Appreciation Right shall be transferable by the Participant other than by will or by the laws of descent and distribution, and all Stock Options and Stock Appreciation Rights shall be exercisable, during the Participant’s lifetime, only by the Participant. Notwithstanding the foregoing, the Committee may determine, in its sole discretion, at the time of grant or thereafter that a Non-Qualified Stock Option that is otherwise not transferable pursuant to this Section 6.7 is transferable to a Family Member of the Participant in whole or in part and in such circumstances, and under such conditions, as specified by the Committee. A Non-Qualified Stock Option that is transferred to a Family Member pursuant to the preceding sentence (a) may not be subsequently transferred other than by will or by the laws of descent and distribution and (b) remains subject to the terms of this Plan and the applicable Award Agreement. Any Shares acquired upon the exercise of a Non-Qualified Stock Option by a permissible transferee of a Non-Qualified Stock Option or a permissible transferee pursuant to a transfer after the exercise of the Non-Qualified Stock Option shall be subject to the terms of this Plan and the applicable Award Agreement.
6.8 Termination. Unless otherwise determined by the Committee at grant or, if no rights of the Participant are reduced, thereafter, subject to the provisions of the applicable Award Agreement and this Plan, upon a Participant’s Termination of Service for any reason, Stock Options and Stock Appreciation Rights may remain exercisable following a Participant’s Termination of Service as follows:
(a) Termination by Death or Disability. Unless otherwise provided in the applicable Award Agreement, or otherwise determined by the Committee at the time of grant or, if no rights of the Participant are reduced, thereafter, if a Participant’s Termination of Service is by reason of death or Disability, all Stock Options and Stock Appreciation Rights that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination of Service may be exercised by the Participant (or in the case of the Participant’s death, by the legal representative of the Participant’s estate) at any time within a period of one (1) year from the date of such Termination of Service, but in no event beyond the expiration of the stated term of such Stock Options and Stock Appreciation Rights; provided, however, that, in the event of a Participant’s Termination of Service by reason of Disability, if the Participant dies within such exercise period, all unexercised Stock Options and Stock Appreciation Rights held by such Participant shall thereafter be exercisable, to the extent to which they were exercisable at the time of death, for a period of one (1) year from the date of such death, but in no event beyond the expiration of the stated term of such Stock Options and/or Stock Appreciation Rights.
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(b) Involuntary Termination Without Cause. Unless otherwise provided in the applicable Award Agreement or otherwise determined by the Committee at the time of grant or, if no rights of the Participant are reduced, thereafter, if a Participant’s Termination of Service is by involuntary termination by the Company without Cause, all Stock Options and Stock Appreciation Rights that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination of Service may be exercised by the Participant at any time within a period of ninety (90) days from the date of such Termination of Service, but in no event beyond the expiration of the stated term of such Stock Options or Stock Appreciation Rights.
(c) Voluntary Resignation. Unless otherwise provided in the applicable Award Agreement or otherwise determined by the Committee at the time of grant or, if no rights of the Participant are reduced, thereafter, if a Participant’s Termination of Service is voluntary (other than a voluntary termination described in Section 6.8(d) hereof), all Stock Options and Stock Appreciation Rights that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination of Service may be exercised by the Participant at any time within a period of thirty (30) days from the date of such Termination of Service, but in no event beyond the expiration of the stated term of such Stock Options or Stock Appreciation Rights.
(d) Termination for Cause. Unless otherwise provided in the applicable Award Agreement or determined by the Committee at the time of grant, or if no rights of the Participant are reduced, thereafter, if a Participant’s Termination of Service (i) is for Cause or (ii) is a voluntary Termination of Service (as provided in Section 6.8(c)) after the occurrence of an event that would be grounds for a Termination of Service for Cause, all Stock Options and Stock Appreciation Rights, whether vested or not vested, that are held by such Participant shall thereupon immediately terminate and expire as of the date of such Termination of Service.
(e) Unvested Stock Options and Stock Appreciation Rights. Unless otherwise provided in the applicable Award Agreement or determined by the Committee at the time of grant or, if no rights of the Participant are reduced, thereafter, Stock Options and Stock Appreciation Rights that are not vested as of the date of a Participant’s Termination of Service for any reason shall terminate and expire as of the date of such Termination of Service.
(f) Incentive Stock Option Limitations. To the extent that the aggregate Fair Market Value (determined as of the time of grant) of the Shares with respect to which Incentive Stock Options are exercisable for the first time by an Eligible Employee during any calendar year under this Plan and/or any other stock option plan of the Company, any Parent, or any Subsidiary exceeds $100,000, such Options shall be treated as Non-Qualified Stock Options. In addition, if an Eligible Employee does not remain employed by the Company, any Parent, or any Subsidiary at all times from the time an Incentive Stock Option is granted until three (3) months prior to the date of exercise thereof (or such other period as required by Applicable Law), such Stock Option shall be treated as a Non-Qualified Stock Option. Should any provision of this Plan not be necessary in order for the Stock Options to qualify as Incentive Stock Options, or should any additional provisions be required, the Committee may amend this Plan accordingly, without the necessity of obtaining the approval of the stockholders of the Company.
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(g) Modification, Extension and Renewal of Stock Options. The Committee may (i) modify, extend, or renew outstanding Stock Options granted under this Plan (provided that the rights of a Participant are not reduced without such Participant’s consent and provided, further that such action does not subject the Stock Options to Section 409A of the Code without the consent of the Participant), and (ii) accept the surrender of outstanding Stock Options (to the extent not theretofore exercised) and authorize the granting of new Stock Options in substitution therefor (to the extent not theretofore exercised).
6.9 Automatic Exercise. The Committee may include a provision in an Award Agreement providing for the automatic exercise of a Non-Qualified Stock Option or Stock Appreciation Right on a cashless basis on the last day of the term of such Option or Stock Appreciation Right if the Participant has failed to exercise the Non-Qualified Stock Option or Stock Appreciation Right as of such date, with respect to which the Fair Market Value of the Shares underlying the Non-Qualified Stock Option or Stock Appreciation Right exceeds the exercise price of such Non-Qualified Stock Option or Stock Appreciation Right on the date of expiration of such Option or Stock Appreciation Right, subject to Section 13.4.
6.10 Dividends. No dividends or Dividend Equivalent Rights shall be granted with respect to Stock Options or Stock Appreciation Rights.
6.11 Other Terms and Conditions. As the Committee shall deem appropriate, Stock Options and Stock Appreciation Rights may be subject to additional terms and conditions or other provisions, which shall not be inconsistent with any of the terms of this Plan.
ARTICLE VII
RESTRICTED STOCK; RESTRICTED STOCK UNITS
7.1 Awards of Restricted Stock and Restricted Stock Units. Shares of Restricted Stock and Restricted Stock Units may be granted alone or in addition to other Awards granted under this Plan. The Committee shall determine the Eligible Individuals to whom, and the time or times at which, grants of Restricted Stock and/or Restricted Stock Units shall be made, the number of shares of Restricted Stock or Restricted Stock Units to be awarded, the price (if any) to be paid by the Participant (subject to Section 7.2), the time or times within which such Awards may be subject to forfeiture, the vesting schedule and rights to acceleration thereof, and all other terms and conditions of the Awards. The Committee shall determine and set forth in the Award Agreement the terms and conditions for each Award of Restricted Stock and Restricted Stock Units, subject to the conditions and limitations contained in this Plan, including any vesting or forfeiture conditions.
The Committee may condition the grant or vesting of Restricted Stock and Restricted Stock Units upon the attainment of specified Performance Goals or such other factor as the Committee may determine in its sole discretion.
7.2 Awards and Certificates. Restricted Stock and Restricted Stock Units granted under this Plan shall be evidenced by an Award Agreement and subject to the following terms and conditions and shall be in such form and contain such additional terms and conditions not inconsistent with the terms of this Plan, as the Committee shall deem desirable:
(a) Restricted Stock.
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(i) Purchase Price. The purchase price of Restricted Stock shall be fixed by the Committee. The purchase price for shares of Restricted Stock may be zero to the extent permitted by Applicable Law, and, to the extent not so permitted, such purchase price may not be less than par value.
(ii) Legend. Each Participant receiving Restricted Stock shall be issued a stock certificate in respect of such shares of Restricted Stock, unless the Committee elects to use another system, such as book entries by the Company’s transfer agent, as evidencing ownership of shares of Restricted Stock. Such certificate shall be registered in the name of such Participant, and shall, in addition to such legends required by Applicable Law, bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Stock.
(iii) Custody. If stock certificates are issued in respect of shares of Restricted Stock, the Committee may require that any stock certificates evidencing such shares be held in custody by the Company until the restrictions thereon shall have lapsed, and that, as a condition of any grant of Restricted Stock, the Participant shall have delivered a duly signed stock power or other instruments of assignment (including a power of attorney), each endorsed in blank with a guarantee of signature if deemed necessary or appropriate by the Company, which would permit transfer to the Company of all or a portion of the shares subject to the Award of Restricted Stock in the event that such Award is forfeited in whole or part.
(iv) Rights as a Stockholder. Except as provided in Section 7.3(a) and this Section 7.2(a) or as otherwise determined by the Committee in an Award Agreement, the Participant shall have, with respect to the shares of Restricted Stock, all of the rights of a holder of Shares, including, without limitation, the right to receive dividends, the right to vote such shares, and, subject to and conditioned upon the full vesting of shares of Restricted Stock, the right to tender such shares; provided that the Award Agreement shall specify on what terms and conditions the applicable Participant shall be entitled to dividends payable on the Shares.
(v) Lapse of Restrictions. If and when the Restriction Period expires without a prior forfeiture of the Restricted Stock, the certificates for such Shares shall be delivered to the Participant. All legends shall be removed from said certificates at the time of delivery to the Participant, except as otherwise required by Applicable Law or other limitations imposed by the Committee.
(b) Restricted Stock Units.
(i) Settlement. The Committee may provide that settlement of Restricted Stock Units will occur upon or as soon as reasonably practical after the Restricted Stock Units vest or will instead be deferred, on a mandatory basis or at the Participant’s election, in a manner intended to comply with Section 409A of the Code.
(ii) Rights as a Stockholder. A Participant will have no rights of a stockholder with respect to Shares subject to any Restricted Stock Unit unless and until Shares are delivered in settlement of the Restricted Stock Units.
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(iii) Dividend Equivalent Rights. If the Committee so provides, a grant of Restricted Stock Units may provide a Participant with the right to receive Dividend Equivalent Rights. Dividend Equivalent Rights may be paid currently or credited to an account for the Participant, settled in cash or Shares, and subject to the same restrictions on transferability and forfeitability as the Restricted Stock Units with respect to which the Dividend Equivalent Rights are granted and subject to other terms and conditions as set forth in the Award Agreement.
7.3 Restrictions and Conditions.
(a) Restriction Period.
(i) The Participant shall not be permitted to transfer shares of Restricted Stock awarded under this Plan or vest in Restricted Stock Units during the period or periods set by the Committee (the “Restriction Period”) commencing on the date of such Award, as set forth in the applicable Award Agreement and such agreement shall set forth a vesting schedule and any event that would accelerate vesting of the Restricted Stock and/or Restricted Stock Units. Within these limits, based on service, attainment of Performance Goals pursuant to Section 7.3(a)(i), and/or such other factors or criteria as the Committee may determine in its sole discretion, the Committee may condition the grant or provide for the lapse of such restrictions in installments in whole or in part, or may accelerate the vesting of all or any part of any Award of Restricted Stock or Restricted Stock Units and/or waive the deferral limitations for all or any part of any Award of Restricted Stock or Restricted Stock Units.
(ii) If the grant of shares of Restricted Stock or Restricted Stock Units or the lapse of restrictions or vesting schedule is based on the attainment of Performance Goals, the Committee shall establish the objective Performance Goals and the applicable vesting percentage applicable to each Participant or class of Participants in the applicable Award Agreement prior to the beginning of the applicable fiscal year or at such later date as otherwise determined by the Committee and while the outcome of the Performance Goals are substantially uncertain. Such Performance Goals may incorporate provisions for disregarding (or adjusting for) changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions), and other similar types of events or circumstances.
(b) Termination. Unless otherwise provided in the applicable Award Agreement or determined by the Committee at grant or, if no rights of the Participant are reduced, thereafter, upon a Participant’s Termination of Service for any reason during the relevant Restriction Period, all Restricted Stock or Restricted Stock Units still subject to restriction will be forfeited in accordance with the terms and conditions established by the Committee at grant or thereafter.
ARTICLE VIII
PERFORMANCE AWARDS
The Committee may grant a Performance Award to a Participant payable upon the attainment of specific Performance Goals either alone or in addition to other Awards granted under this Plan. The Performance Goals to be achieved during the Performance Period and the length of the Performance Period shall be determined by the Committee upon the grant of each Performance Award.
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The conditions for grant or vesting and the other provisions of Performance Awards (including, without limitation, any applicable Performance Goals) need not be the same with respect to each Participant. Performance Awards may be paid in cash, Shares, other property, or any combination thereof, in the sole discretion of the Committee as set forth in the applicable Award Agreement.
ARTICLE IX
OTHER STOCK-BASED AND CASH AWARDS
9.1 Other Stock-Based Awards. The Committee is authorized to grant to Eligible Individuals Other Stock-Based Awards that are payable in, valued in whole or in part by reference to, or otherwise based on or related to Shares, including but not limited to, Shares awarded purely as a bonus and not subject to restrictions or conditions, Shares in payment of the amounts due under an incentive or performance plan sponsored or maintained by the Company, stock equivalent units, and Awards valued by reference to the book value of Shares. Other Stock-Based Awards may be granted either alone or in addition to or in tandem with other Awards granted under this Plan.
Subject to the provisions of this Plan, the Committee shall have authority to determine the Eligible Individuals, to whom, and the time or times at which, such Other Stock-Based Awards shall be made, the number of Shares to be awarded pursuant to such Awards, and all other conditions of the Awards. The Committee may also provide for the grant of Shares under such Awards upon the completion of a specified Performance Period. The Committee may condition the grant or vesting of Other Stock-Based Awards upon the attainment of specified Performance Goals as the Committee may determine, in its sole discretion.
9.2 Terms and Conditions. Other Stock-Based Awards made pursuant to this Article IX shall be evidenced by an Award Agreement and subject to the following terms and conditions and shall be in such form and contain such additional terms and conditions not inconsistent with the terms of this Plan, as the Committee shall deem desirable:
(a) Non-Transferability. Subject to the applicable provisions of the Award Agreement and this Plan, Shares subject to Other Stock-Based Awards may not be transferred prior to the date on which the Shares are issued or, if later, the date on which any applicable restriction, performance, or deferral period lapses.
(b) Dividends. Unless otherwise determined by the Committee at the time of the grant of an Other Stock-Based Award, subject to the provisions of the Award Agreement and this Plan, the recipient of an Other Stock-Based Award shall not be entitled to receive, currently or on a deferred basis, dividends or Dividend Equivalent Rights in respect of the number of Shares covered by the Other Stock-Based Award.
(c) Vesting. Any Other Stock-Based Award and any Shares covered by any such Other Stock-Based Award shall vest or be forfeited to the extent so provided in the Award Agreement, as determined by the Committee, in its sole discretion.
(d) Price. Shares under this Article IX may be issued for no cash consideration. Shares purchased pursuant to a purchase right awarded pursuant to an Other Stock-Based Award shall be priced, as determined by the Committee in its sole discretion.
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9.3 Cash Awards. The Committee may from time to time grant Cash Awards to Eligible Individuals in such amounts, on such terms and conditions, and for such consideration, including no consideration or such minimum consideration as may be required by Applicable Law, as it shall determine in its sole discretion. Cash Awards may be granted subject to the satisfaction of vesting conditions or may be awarded purely as a bonus and not subject to restrictions or conditions, and if subject to vesting conditions, the Committee may accelerate the vesting of such Awards at any time in its sole discretion. The grant of a Cash Award shall not require a segregation of any of the Company’s assets for satisfaction of the Company’s payment obligation thereunder.
ARTICLE X
CHANGE IN CONTROL PROVISIONS
10.1 Benefits. In the event of a Change in Control of the Company, and except as otherwise provided by the Committee in an Award Agreement or any applicable employment agreement, offer letter, consulting agreement, change in control agreement, or similar agreement in effect between the Company or an Affiliate and the Participant, a Participant’s unvested Awards shall not vest automatically and a Participant’s Awards shall be treated in accordance with one or more of the following methods as determined by the Committee:
(a) Awards, whether or not then vested, shall be continued, be assumed, or have new rights substituted therefor, as determined by the Committee in a manner consistent with the requirements of Section 409A of the Code, and restrictions to which shares of Restricted Stock or any other Award granted prior to the Change in Control are subject shall not lapse upon a Change in Control and the Restricted Stock or other Award shall, where appropriate in the sole discretion of the Committee, receive the same distribution as other Shares on such terms as determined by the Committee; provided that the Committee may decide to award additional Restricted Stock or other Awards in lieu of any cash distribution. Notwithstanding anything to the contrary herein, for purposes of Incentive Stock Options, any assumed or substituted Stock Option shall comply with the requirements of Treasury Regulation Section 1.424-1 (and any amendment thereto).
(b) The Committee, in its sole discretion, may provide for the purchase of any Awards by the Company for an amount of cash equal to the excess (if any) of the Change in Control Price of the Shares covered by such Awards, over the aggregate exercise price of such Awards; provided, however, that if the exercise price of an Option or Stock Appreciation Right exceeds the Change in Control Price, such Award may be cancelled for no consideration.
(c) The Committee may, in its sole discretion, terminate all outstanding and unexercised Stock Options, Stock Appreciation Rights, or any Other Stock-Based Award that provides for a Participant-elected exercise, effective as of the date of the Change in Control, by delivering notice of termination to each Participant at least twenty (20) days prior to the date of consummation of the Change in Control, in which case during the period from the date on which such notice of termination is delivered to the consummation of the Change in Control, each such Participant shall have the right to exercise in full all of such Participant’s Awards that are then outstanding (without regard to any limitations on exercisability otherwise contained in the Award Agreements), but any such exercise shall be contingent on the occurrence of the Change in Control, and, provided that, if the Change in Control does not take place within a specified period after giving such notice for any reason whatsoever, the notice and exercise pursuant thereto shall be null and void.
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(d) Notwithstanding any other provision herein to the contrary, the Committee may, in its sole discretion, provide for accelerated vesting or lapse of restrictions, of an Award at any time.
ARTICLE XI
TERMINATION OR AMENDMENT OF PLAN
Notwithstanding any other provision of this Plan, the Board or the Committee may at any time, and from time to time, amend, in whole or in part, any or all of the provisions of this Plan (including any amendment deemed necessary to ensure that the Company may comply with any Applicable Law), or suspend or terminate it entirely, retroactively or otherwise; provided, however, that, unless otherwise required by Applicable Law or specifically provided herein, the rights of a Participant with respect to Awards granted prior to such amendment, suspension, or termination may not be materially impaired without the consent of such Participant and, provided, further, that without the approval of the holders of the Shares entitled to vote in accordance with Applicable Law, no amendment may be made that would (a) increase the aggregate number of Shares that may be issued under this Plan (except by operation of Section 4.1); or (b) change the classification of individuals eligible to receive Awards under this Plan. In addition, the Board or the Committee shall, without the approval of the holders of the Shares entitled to vote in accordance with Applicable Law, have the authority to (i) amend any outstanding Option or Stock Appreciation Right to reduce its exercise price per Share or (ii) cancel any Option or Stock Appreciation Right in exchange for cash or another Award. Notwithstanding anything herein to the contrary, the Board or the Committee may amend this Plan or any Award Agreement at any time without a Participant’s consent to comply with Applicable Law, including Section 409A of the Code. The Committee may amend the terms of any Award theretofore granted, prospectively or retroactively, but, subject to Article IV or as otherwise specifically provided herein, no such amendment or other action by the Committee shall materially impair the rights of any Participant without the Participant’s consent.
ARTICLE XII
UNFUNDED STATUS OF PLAN
This Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payment as to which a Participant has a fixed and vested interest but which is not yet made to a Participant by the Company, nothing contained herein shall give any such Participant any right that is greater than those of a general unsecured creditor of the Company.
ARTICLE XIII
GENERAL PROVISIONS
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13.1 Lock-Up; Legend. The Committee may require each person receiving Shares pursuant to a Stock Option or other Award under this Plan to represent to and agree with the Company in writing that the Participant is acquiring the Shares without a view to distribution thereof. The Company may, in connection with registering the offering of any Company securities under the Securities Act, prohibit Participants from, directly or indirectly, selling or otherwise transferring any Shares or other Company securities during any period determined by the underwriter or the Company. In addition to any legend required by this Plan, the certificates for such Shares may include any legend that the Committee deems appropriate to reflect any restrictions on transfer. All certificates for Shares delivered under this Plan shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Common Stock is then listed or any national securities exchange system upon whose system the Common Stock is then quoted, and any Applicable Law, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions. If the Shares are held in book-entry form, then the book-entry will indicate any restrictions on such Shares.
13.2 Other Plans. Nothing contained in this Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to stockholder approval if such approval is required, and such arrangements may be either generally applicable or applicable only in specific cases.
13.3 No Right to Employment/Directorship/Consultancy. Neither this Plan nor the grant of any Award hereunder shall give any Participant or other employee, Consultant or Non-Employee Director any right with respect to continuance of employment, consultancy or directorship by the Company or any Affiliate, nor shall there be a limitation in any way on the right of the Company or any Affiliate by which an employee is employed or a Consultant or Non-Employee Director is retained to terminate such employment, consultancy, or directorship at any time.
13.4 Withholding of Taxes. A Participant shall be required to pay to the Company or one of its Affiliates, as applicable, or make arrangements satisfactory to the Company regarding the payment of, any income tax, social insurance contribution or other applicable taxes that are required to be withheld in respect of an Award. The Committee may (but is not obligated to), in its sole discretion, permit or require a Participant to satisfy all or any portion of the applicable taxes that are required to be withheld with respect to an Award by (a) the delivery of Shares (which are not subject to any pledge or other security interest) that have been both held by the Participant and vested for at least six (6) months (or such other period as established from time to time by the Committee in order to avoid adverse accounting treatment under applicable accounting standards) having an aggregate Fair Market Value equal to such withholding liability (or portion thereof); (b) having the Company withhold from the Shares otherwise issuable or deliverable to, or that would otherwise be retained by, the Participant upon the grant, exercise, vesting, or settlement of the Award, as applicable, a number of Shares with an aggregate Fair Market Value equal to the amount of such withholding liability; or (c) by any other means specified in the applicable Award Agreement or otherwise determined by the Committee.
13.5 Fractional Shares. No fractional Shares shall be issued or delivered pursuant to this Plan. The Committee shall determine whether cash, additional Awards, or other securities or property shall be used or paid in lieu of fractional Shares or whether any fractional shares should be rounded, forfeited, or otherwise eliminated.
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13.6 No Assignment of Benefits. No Award or other benefit payable under this Plan shall, except as otherwise specifically provided in this Plan or under Applicable Law or permitted by the Committee, be transferable in any manner, and any attempt to transfer any such benefit shall be void, and any such benefit shall not in any manner be liable for or subject to the debts, contracts, liabilities, engagements, or torts of any person who shall be entitled to such benefit, nor shall it be subject to attachment or legal process for or against such person.
13.7 Clawback Policy. All awards, amounts, or benefits received or outstanding under this Plan will be subject to clawback, cancellation, recoupment, rescission, payback, reduction, or other similar action in accordance with any Company clawback or similar policy or any Applicable Law related to such actions. A Participant’s acceptance of an Award will constitute the Participant’s acknowledgement of and consent to the Company’s application, implementation, and enforcement of any applicable Company clawback or similar policy that may apply to the Participant, whether adopted before or after the Effective Date, and any Applicable Law relating to clawback, cancellation, recoupment, rescission, payback, or reduction of compensation, and the Participant’s agreement that the Company may take any actions that may be necessary to effectuate any such policy or Applicable Law, without further consideration or action.
13.8 Listing and Other Conditions.
(a) Unless otherwise determined by the Committee, as long as the Common Stock is listed on a national securities exchange or system sponsored by a national securities association, the issuance of Shares pursuant to an Award shall be conditioned upon such Shares being listed on such exchange or system. The Company shall have no obligation to issue such Shares unless and until such Shares are so listed, and the right to exercise any Option or other Award with respect to such Shares shall be suspended until such listing has been effected.
(b) If at any time counsel to the Company advises the Company that any sale or delivery of Shares pursuant to an Award is or may in the circumstances be unlawful or result in the imposition of excise taxes on the Company under Applicable Law, the Company shall have no obligation to make such sale or delivery, or to make any application or to effect or to maintain any qualification or registration under the Securities Act or otherwise, with respect to Shares or Awards, and the right to exercise any Option or other Award shall be suspended until, based on the advice of said counsel, such sale or delivery shall be lawful or will not result in the imposition of excise taxes on the Company.
(c) Upon termination of any period of suspension under this Section 13.8, any Award affected by such suspension which shall not then have expired or terminated shall be reinstated as to all Shares available before such suspension and as to Shares which would otherwise have become available during the period of such suspension, but no such suspension shall extend the term of any Award.
(d) A Participant shall be required to supply the Company with certificates, representations, and information that the Company requests and otherwise cooperate with the Company in obtaining any listing, registration, qualification, exemption, consent, or approval that the Company deems necessary or appropriate.
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13.9 Governing Law. This Plan and actions taken in connection herewith shall be governed and construed in accordance with the laws of the State of New York, without reference to principles of conflict of laws.
13.10 Construction. Wherever any words are used in this Plan in the masculine gender they shall be construed as though they were also used in the feminine gender in all cases where they would so apply, and wherever words are used herein in the singular form they shall be construed as though they were also used in the plural form in all cases where they would so apply.
13.11 Other Benefits. No Award granted or paid out under this Plan shall be deemed compensation for purposes of computing benefits under any retirement plan of the Company or its Affiliates or affect any benefit or compensation under any other plan now or subsequently in effect under which the availability or amount of benefits is related to the level of compensation.
13.12 Costs. The Company shall bear all expenses associated with administering this Plan, including expenses of issuing Shares pursuant to Awards hereunder.
13.13 No Right to Same Benefits. The provisions of Awards need not be the same with respect to each Participant, and such Awards to individual Participants need not be the same in subsequent years.
13.14 Death/Disability. The Committee may in its discretion require the transferee of a Participant to supply it with written notice of the Participant’s death or Disability and to supply it with a copy of the will (in the case of the Participant’s death) or such other evidence as the Committee deems necessary to establish the validity of the transfer of an Award. The Committee may also require the agreement of the transferee to be bound by all of the terms and conditions of this Plan.
13.15 Section 16(b) of the Exchange Act. It is the intent of the Company that this Plan satisfy, and be interpreted in a manner that satisfies, the applicable requirements of Rule 16b-3 as promulgated under Section 16 of the Exchange Act so that Participants will be entitled to the benefit of Rule 16b-3, or any other rule promulgated under Section 16 of the Exchange Act, and will not be subject to short-swing liability under Section 16 of the Exchange Act. Accordingly, if the operation of any provision of this Plan would conflict with the intent expressed in this Section 13.15, such provision to the extent possible shall be interpreted and/or deemed amended so as to avoid such conflict.
13.16 Deferral of Awards. The Committee may establish one or more programs under this Plan to permit selected Participants the opportunity to elect to defer receipt of consideration upon exercise of an Award, satisfaction of performance criteria, or other event that absent the election would entitle the Participant to payment or receipt of Shares or other consideration under an Award. The Committee may establish the election procedures, the timing of such elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on amounts, Shares or other consideration so deferred, and such other terms, conditions, rules, and procedures that the Committee deems advisable for the administration of any such deferral program.
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13.17 Section 409A of the Code. This Plan and Awards are intended to comply with or be exempt from the applicable requirements of Section 409A of the Code and shall be limited, construed, and interpreted in accordance with such intent. To the extent that any Award is subject to Section 409A of the Code, it shall be paid in a manner that will comply with Section 409A of the Code. Notwithstanding anything herein to the contrary, any provision in this Plan that is inconsistent with Section 409A of the Code shall be deemed to be amended to comply with or be exempt from Section 409A of the Code and, to the extent such provision cannot be amended to comply therewith or be exempt therefrom, such provision shall be null and void. The Company shall have no liability to a Participant, or any other party, if an Award that is intended to be exempt from, or compliant with, Section 409A of the Code is not so exempt or compliant or for any action taken by the Committee or the Company and, in the event that any amount or benefit under this Plan becomes subject to penalties under Section 409A of the Code, responsibility for payment of such penalties shall rest solely with the affected Participants and not with the Company. Notwithstanding any contrary provision in this Plan or Award Agreement, any payment(s) of “nonqualified deferred compensation” (within the meaning of Section 409A of the Code) that are otherwise required to be made under this Plan to a “specified employee” (as defined under Section 409A of the Code) as a result of such employee’s separation from service (other than a payment that is not subject to Section 409A of the Code) shall be delayed for the first six (6) months following such separation from service (or, if earlier, until the date of death of the specified employee) and shall instead be paid (in a manner set forth in the Award Agreement) upon expiration of such delay period.
13.18 Data Privacy. As a condition of receipt of any Award, each Participant explicitly and unambiguously consents to the collection, use, and transfer, in electronic or other form, of personal data as described in this Section 13.18 by and among, as applicable, the Company and its Affiliates, for the exclusive purpose of implementing, administering, and managing this Plan and Awards and the Participant’s participation in this Plan. In furtherance of such implementation, administration, and management, the Company and its Affiliates may hold certain personal information about a Participant, including, but not limited to, the Participant’s name, home address, telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title(s), information regarding any securities of the Company or any of its Affiliates, and details of all Awards (the “Data”). In addition to transferring the Data amongst themselves as necessary for the purpose of implementation, administration, and management of this Plan and Awards and the Participant’s participation in this Plan, the Company and its Affiliates may each transfer the Data to any third parties assisting the Company in the implementation, administration, and management of this Plan and Awards and the Participant’s participation in this Plan. Recipients of the Data may be located in the Participant’s country or elsewhere, and the Participant’s country and any given recipient’s country may have different data privacy laws and protections. By accepting an Award, each Participant authorizes such recipients to receive, possess, use, retain, and transfer the Data, in electronic or other form, for the purposes of assisting the Company in the implementation, administration, and management of this Plan and Awards and the Participant’s participation in this Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom the Company or the Participant may elect to deposit any shares of Common Stock. The Data related to a Participant will be held only as long as is necessary to implement, administer, and manage this Plan and Awards and the Participant’s participation in this Plan. A Participant may, at any time, view the Data held by the Company with respect to such Participant, request additional information about the storage and processing of the Data with respect to such Participant, recommend any necessary corrections to the Data with respect to the Participant, or refuse or withdraw the consents herein in writing, in any case without cost, by contacting his or her local human resources representative. The Company may cancel the Participant’s eligibility to participate in this Plan, and in the Committee’s discretion, the Participant may forfeit any outstanding Awards if the Participant refuses or withdraws the consents described herein. For more information on the consequences of refusal to consent or withdrawal of consent, Participants may contact their local human resources representative.
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13.19 Successor and Assigns. This Plan shall be binding on all successors and permitted assigns of a Participant, including, without limitation, the estate of such Participant and the executor, administrator, or trustee of such estate.
13.20 Severability of Provisions. If any provision of this Plan shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions hereof, and this Plan shall be construed and enforced as if such provisions had not been included.
13.21 Headings and Captions. The headings and captions herein are provided for reference and convenience only, shall not be considered part of this Plan, and shall not be employed in the construction of this Plan.
ARTICLE XIV
EFFECTIVE DATE OF PLAN
This Plan shall become effective on March 5, 2025, which is the date of its adoption by the Board, subject to the approval of this Plan by the stockholders of the Company in accordance with the requirements of the laws of the State of New York.
ARTICLE XV
TERM OF PLAN
No Award shall be granted pursuant to this Plan on or after the tenth (10th) anniversary of the earlier of the date that this Plan is adopted by the Board or the date of stockholder approval, but Awards granted prior to such tenth (10th) anniversary may extend beyond that date.
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