25 Nov

Employee Securities Incentive Plan

Error! Unknown document property name. Employee Securities Incentive Plan Parabellum Resources Limited ACN 645 149 211 Level 20, 240 St Georges Terrace, Perth WA 6000 Australia Telephone +61 8 6559 6500 PO Box 7222, Cloisters Square WA 6850 Australia Facsimile 1300 704 211 (Australia) +61 2 8507 6580 (International) hwlebsworth.com.au Employee Securities Incentive Plan Page i Table of c ontents 1. Definitions and interpretation 1 1.1 Definitions 1 1.2 Interpretation 6 1.3 Inconsistenc ies 7 1.4 Income Tax Assessment Act 7 1.5 Construed against a party 7 1.6 Applicable Law 8 1.7 Rounding 8 1.8 Constitution 8 2. Introduction 8 2.1 Purpose 8 2.2 Commencement 8 2.3 Rules are binding 8 3. Eligibility, Invitation and Application 8 3.1 Eligibility 8 3.2 Invitation 9 3.3 Form of Application 9 3.4 Eligible Participant agrees to be bound 9 3.5 Who may apply 10 3.6 Acceptance of Application 10 3.7 When an Application will not be accepted 10 3.8 Right to nominate 10 3.9 Multiple Invitations 11 4. Grant of Securities 11 4.1 Compan y to grant Securities 11 4.2 Certificate of Security 11 5. Terms of Convertible Securities 12 5.1 Participant's rights 12 5.2 Rest riction of dealing 12 Employee Securities Incentive Plan Page ii 5.3 Prohibition on hedging 12 5.4 Register of Convertible Securities 12 5.5 Listing 12 6. Vesting of Convertible Securities 13 6.1 Vesting 13 6.2 Waiver of Vesting Condition 13 7. Exercise of Convertible Securities 13 7.1 Exercise of Convertible Securities 13 7.2 Cashless exercise of Convertible Securities 14 8. Delivery of Shares on exercise of Convertible Securities 14 9. Forfeiture of Convertible Securities 14 9.1 Leaver 14 9.2 Fraudulent or dishonest actions 14 9.3 Failure to satisfy Vesting Conditions 15 9.4 Insolvency 15 9.5 Other forfeitu re events 1 5 9.6 Discretion to determine that the Convertible Securities are not forfeited 15 9.7 Voluntary forfeiture 15 9.8 Application of Part 2D.2 Division 2 of the Corporations Act 16 10. Effect of Forfeiture of Convertible Securities 16 11. Change of Control 16 12. Rights attaching to Plan Shares 17 12.1 Plan Shares to rank equally 17 12.2 Listing 17 12.3 Dividends 17 12.4 Dividend reinvestment plan 17 12.5 Voting rights 17 13. Disposal Restrictions on Plan Shares 17 13.1 Disposal restriction 17 13.2 Participant's undertaking 18 Employee Securities Incentive Plan Page iii 13.3 Expiry of restriction 18 13.4 S hare entitlements 18 14. Irrevocable Power of Attorney 18 15. Adjustment of Convertible Securities 18 15.1 Reorganisation 18 15.2 Bonus Iss ue 19 15.3 Rights Issue 19 15.4 No other participation 19 15.5 Rounding 19 15.6 Application of adjustment 19 16. Administration of the Plan 20 16.1 Board administration 20 16.2 Board powers and discretions 20 16.3 Delegation of Board powers and discretions 20 16.4 Documents 20 16.5 Decisions final 21 17. Trust 21 18. Restrictions on and amendments to the Plan 21 18.1 Compliance with Applicable Laws 21 18.2 Amendment of Plan 22 19. Durati on 23 19.1 Termination 23 19.2 Suspension 23 19.3 Effect of termination / suspension 23 19.4 Cancellation of Convertible Securities 23 20. Miscellaneous 23 20.1 Rights of Participants 23 20.2 Non - exclusivity 24 20.3 Notice 24 20.4 Further assurances 25 20.5 Costs and charges 25 Employee Securities Incentive Plan Page iv 20.6 No representation or warranty 25 20.7 Data protection 25 20.8 Governing law 25 20.9 Waiver of rights 26 Employee Securities Incentive Plan Page 1 Parabellum Resources Ltd - Employee Securities Incentive Plan 1. Definitions and interpretation 1.1 Definitions In these Rules, unless the context otherwise requires, the following terms and expressions will have the following meanings: Ancillary Documentation means all documentation which the Board specifies in an Invitation that an Eligible Participant must enter into and/or provide in connection with an Application for Securities. Applicable Law means any one or more or all, as the context requires of: (a) the Corporations Act; (b) the Listing Rules; (c) the Constitution; (d) the Income Tax Assessment Act 1936 (Cth) and the Income Tax Assessment Act 1997 (Cth); (e) any relevant practice note, policy statement, regulatory guide, class order, declaration, guideline, policy, procedure, ruling, judicial interpretation or other guidance note made to clarify, expand or amend (a) , (b) , or (d) above; (f) any other legal requirement (including, without limitation, the rules of the general law, including common law and equity, and any judgment, order, decree, declaration or ruling of a court of competent jurisdiction or government agency binding on a person or the assets of that person) that applies to the Plan; and (g) in respect of acquisition or disposals of any Shares, any formal policy relating to dealings in Shares adopted by the Board from time to time, including the S hare Trading Policy. Application means, in respect of a Security, an application for that Security made by an Eligible Participant in response to an Invitation. Application Form means an application form attached to, or enclosed with, an Invitation. ASI C means the Australian Securities and Investments Commission. Employee Securities Incentive Plan Page 2 ASIC Class Order 14/1000 means ASIC Class Order (CO 14/1000) which provides relief for employee incentive scheme offers from disclosure, licensing, advertising, hawking and on - sale in relation to listed bodies. Associate has the same meaning as in section 12 of the Corporations Act. Associated Body Corporate ha s the meaning given to that term in ASIC Class Order 14/1000. ASX means the ASX Limited (ABN 98 008 624 691) trading as the Australian Securities Exchange or the securities exchange operated by that entity, as appropriate. ASX Holding Lock has the same meaning as ' Holding Lock ' in Chapter 19 of the Listing Rules . Board means the board of directors of the Company, a committee appointed by the board of directors of the Company as constituted from time to time, or, in respect of a particular matter, any person who is provided with delegated authority by the board of directors of the Company in respect of that particular matter from time to time. Business Day means a day (other than a Saturday, Sunday or public holiday) on which banks are open for general banking business in Perth , Australia. Certificate means a certificate evidencing the grant of a Security. Change of Control Event means: (a) a change in Control of the Company; (b) where members of the Company approve any compromise or arrangement for the purpose of, or in connection with, a scheme for the reconstruction of the Company or its amalgamation with any other body corporate or bodies corporate (other than a scheme that does not involve a change in the ultimate beneficial ownership of the Company) , which will, upon becoming effective, result in any person (either alone or together with its Associates) owning more than fifty per cent (50%) of Issued Capital; (c) where a person becomes the legal or the beneficial owner of, or has a Relevant Interest in, more than fifty per cent (50%) of Issued Capital; (d) where a person becomes entitled to acquire, hold or has an equitable interest in more than fifty per cent (50%) of Issued Capital; and Employee Securities Incentive Plan Page 3 (e) where a Takeover Bid is made to acquire more than fifty per cent (50%) of Issued Capital (or such lesser number of Shares that when combined with the Shares that the bidder (together with its Associates) already owns will amount to more than 50% of Issued Capital) and the Takeover Bid becomes unconditional and the bidder (tog ether with its Associates) has a Relevant Interest in more than 50% of Issued Capital, but, for the avoidance of doubt, does not include any internal reorganisation of the structure, business and/or assets of the Group. Company means Parabellum Resources Limited ACN 645 149 211 . Constitution means the constitution of the Company. Control has the same meaning as in section 50AA of the Corporations Act. Convertible Security means a Security exercisable for Plan Share(s) in accordance with these Rules, including an Option or Performance Right. Corporations Act means the Corporations Act 2001 (Cth) , as amended . Derivatives include: (a) derivatives within the meaning given in section 761D of the Corporations Act (such as options, forward contracts, swaps, futures, warrants, caps and collars); and (b) any other transaction in financial products which operate to limit (in any way) the economic risk associated with holding the relevan t securities. Eligible Participant means a person that: (a) is an 'eligible participant' (as that term is defined in ASIC Class Order 14/1000) in relation to the Company or an Associated Body Corporate; and (b) has been determined by the Board to be eligible to p articipate in the Plan from time to time. Engagement Arrangement means in respect of: (a) an employee of a member of the Group, the terms under which the relevant member of the Group has employed that person; (b) a director of a member of the Group that is not al so an employee, the terms under which the relevant member of the Group has appointed that director to their office; or Employee Securities Incentive Plan Page 4 (c) a contractor or consultant to a member of the Group, the terms under which the relevant member of the Group has engaged that contractor o r consultant. Exercise Price means, in respect of a Convertible Security, the price to be paid by the Participant (if any) when exercising that Security as specified in the relevant Invitation . For the avoidance of doubt, the Exercise Price for a Securit y may be nil. Expiry Date means, in relation to a Convertible Security, the 'expiry date' which is specified in the Invitation or Vesting Notice (if any). Grant Date means, in relation to a Security, the date on which that Security is granted to a Participant, as set out on the relevant Certificate. Group means the Company and each of its Associated Bodies Corporate from time to time. Insolvent A person is Insolvent if: (a) it is (or states that it is) an insolvent under administration or insolvent (e ach as defined in the Corporations Act); (b) it has had a controller appointed or is in liquidation, in provisional liquidation, under administration, wound up or has had a receiver appointed to any part of its property; (c) it is subject to any arrangement, assig nment, moratorium or composition, protected from creditors under any statute or dissolved (in each case, other than to carry out a reconstruction or amalgamation while solvent on terms approved by the Company); (d) an application or order has been made (and in the case of the application, it is not stayed, withdrawn or dismissed within 30 days), resolution passed, proposal put forward, or any other action taken, in each case in connection with that person, which is likely to result in any of (a) , (b) or (c) above); (e) it is taken (under s.459F(1) of the Corporations Act) to have failed to comply with a statutory demand); (f) it is subject to an event described in section 459C(2)(b) or section 585 of the Corporations Act; (g) it is otherwise unable to pay its debts when they fall due; or (h) something having a substantially similar effect to (a) to (g) happens in connection with that person under the law of any jurisdiction. Employee Securities Incentive Plan Page 5 Invitation means an invitation to an Eligible Participant to apply for the grant of one or more Securities made in accordance with clause 3.2 of these Rules. Issued Capital means issued Shares from time to time. Leaver means a Participant who ceases to be an Eligible Participa nt. Listing Rules means the listing rules, market rules and operating rules of a financial market in respect of which the Company's shares are quoted or are the subject of an application for quotation, including but not limited to, the official listing ru les of the ASX. Market Value means, at any given date, the volume weighted average price per Share traded on the ASX over the five (5) trading days immediately preceding that given date, unless otherwise specified in an Invitation. Nominated Party means, in respect of an Eligible Participant: (a) that person's spouse; (b) that person's biological or legally adopted child of at least 18 years of age; (c) a trustee or trustees of a trust set up wholly for the benefit of that Eligible Participant and/or a person mentioned in sub - clauses (a) or (b) abo ve (but not including any trust established by the Company under clause 17 ); or (d) a company in which all of the issued shares are beneficially held by , and all of the voting rights are beneficially held by: (i) the Eligible Participant; and/or (ii) a person or persons mentioned in sub - clauses (a) , (b) or (c) above. Notice of Exercise means a notice given by or on behalf of the Participant (in a form to be determined by the Board from time to time) to exercise a Convertible Security in accordance with clause 7.1 . Option means an option granted under these Rules to acquire one or more Shares by transfer or allotment, as set out in the relevant Invitation. Participant means an Eligible Participant who has been granted any Security under this Plan. Performance Right means a right granted under these Rules to acquire one or more shares by transfer or allotment as set out in the relevant Invitation. Employee Securities Incentive Plan Page 6 Plan means the Parabellum Resources Limited Employee Incentive Plan. Plan Shares means all Shares issued or transferred to a Participant under these Rules, including upon the valid exercise of a Security. Rules means the rules of the Plan which are set out in this document. Security means a security in t he capital of the Company granted under these Rules, including a Plan Share, Option, Performance Right or other Convertible Security. Security Interest means a mortgage, charge, pledge, lien, encumbrance or other third party interest of any nature. Share means a fully paid ordinary share in the capital of the Company. Shareholder means a holder of a Share. Share Trading Policy means any share trading policy of the Company, as amended from time to time. Takeover Bid has the meaning given to that term in the Corporations Act. Trustee means the trustee, from time to time, of any employee share trust used by the Company to deliver any Plan Shares arising from the exercise of a Convertible Security under these Rules. Vesting Condition means , in rela tion to a Convertible Security, any conditions to vesting of that Convertible Security that are set out in the Invitation for that Convertible Security. Vesting Notice means , in relation to a Convertible Security, the notice given by or on behalf of the C ompany to a Participant informing him or her that the Convertible Security may be exercised in accordance with the terms of these Rules. 1.2 Interpretation In these Rules, unless otherwise stated or the contrary intention appears: (a) the singular includes the plural and vice versa; (b) a gender includes all genders; (c) a reference to a document, agreement, plan or rules includes that document, agreement, plan or rules as novated, amended, varied, supplemented or replaced from time to time; (d) headings are fo r convenience only and do not affect the interpretation of these Rules; Employee Securities Incentive Plan Page 7 (e) a reference to any thing (including any amount) includes any part of that thing and a reference to a group of things or persons includes each thing or person in that group; (f) a reference to any legislation includes any modification or replacement of it and all regulations and statutory instruments issued under it and a reference to any provision of any legislation includes any modification or substitution of it; (g) a reference to these Rules includes all recitals, annexures, addendums and schedules to these Rules; (h) a reference to a person includes a reference to the person's executors, legal personal representatives, administrators and successors or a body corporate including any person taking by way of novation and, in the case of a trustee, includes any substituted or additional trustee; (i) the expression ' person ' includes an individual, the estate of an individual, the legal personal representative of an individual, a corporation, an authority , an association or a joint venture (whether incorporated or unincorporated), a partnership and a trust; (j) in these Rules any reference to ' include ' means to include without limitation; (k) a reference to ' including ' (or any similar term) is not to be construed as implying any limitation; (l) a monetary amount is a reference to Australian dollars; (m) where any word is given a defined meaning, any other part of speech or other grammatical form in respect of such word or phra se has a corresponding meaning; and (n) any capitalised terms in these Rules that are not defined in clause 1.1 have the meaning given to them in the Corporations Act. 1.3 Inconsistencies Notwithstanding anything to the contrary in any Engagement Arrangement with a Participant, but subject at all times to these Rules, if there is any inconsistency between these Rules and an Engagement Arrangement, these Rules prevail. 1.4 Incom e Tax Assessment Act This Plan is a plan to which Subdivision 83A - C of the Income Tax Assessment Act 1997 (Cth) applies (subject to the conditions in that Act). 1.5 Construed against a party No provision or expression in these Rules is to be construed against a party on the basis that the party (or its advisers) was responsible for the drafting of these Rules. Employee Securities Incentive Plan Page 8 1.6 Applicable Law These Rules, the offering and granting of any Security and the rights attaching to or interests in any Security will at all times be subje ct to Applicable Law. 1.7 Rounding Where any calculation or adjustment to be made pursuant to these Rules produces a fraction of a cent or a fraction of a Security , the fraction will be eliminated by rounding to the nearest whole number. 1.8 Constitution The entit lements of Eligible Participants under these Rules are subject to the Constitution . In the event of any inconsistency between these Rules and the Constitution, the terms of the Constitution will prevail. 2. Introduction 2.1 Purpose The purpose of the Plan is to: (a) assist in the reward, retention and motivation of Eligible Participants; (b) link the reward of Eligible Participants to Shareholder value creation; and (c) align the interests of Eligible Participants with shareholders of the Group by providing an opportunity to Eligible Participants to receive an equity interest in the Company in the form of Securities. 2.2 Commencement The Plan will commence on a date determined by the Board. 2.3 Rules are binding The Company and each Participant are bound by these Rules. 3. Eligibilit y, Invitation and Application 3.1 Eligibility The Board may from time to time determine that an Eligible Participant may participate in the Plan. Employee Securities Incentive Plan Page 9 3.2 Invitation (a) Following determination that an Eligible Participant may participate in the Plan, the Board may at any time and from time to time make an Invitation to that Eligible Participant. (b) An Invitation to an Eligible Participant to apply for Securities may be made on such terms and conditions as the Board decides from time to time, including as to: (i) the number of Sec urities for which that Eligible Participant may apply; (ii) the Grant Date; (iii) the amount payable (if any) for the grant of each Security or how such amount is calculated; (iv) the Exercise Price (if any); (v) the Vesting Conditions (if any); (vi) disposal restrictions attachin g to the Plan Shares (if any); (vii) whether cashless exercise of the Securities is permitted under clause 7.2 ; (viii) the method by which Shares will be deliver ed to the Participant under clause 8 after the valid exercise of the Convertible Security (if relevant) ; and (ix) any other supplementary terms and condi tions. 3.3 Form of Application An Invitation to an Eligible Participant must be accompanied by an Application Form and the Ancillary Documentation (if any). 3.4 Eligible Participant agrees to be bound Each Eligible Participant is, by submitting a completed Application Form, deemed to have agreed to be bound by: (a) the terms of the Invitation and the Application Form; (b) the Ancillary Documentation (if any); (c) these Rules; and (d) the Constitution. Employee Securities Incentive Plan Page 10 3.5 Who may apply On receipt of an Invitation, an Eligible Particip ant may apply for the Securities the subject of the Invitation by sending the completed Application Form to the Company (or its designated officer as set out in the Application Form) by the time and date specified in the Invitation, unless otherwise determ ined by the Board. 3.6 Acceptance of Application (a) The Board may accept an Application from an Eligible Participant in whole or in part. (b) The Company may not grant a Security to an Eligible Participant unless it has received a duly signed and completed Applicatio n Form together with all applicable Ancillary Documentation from that Eligible Participant . The Application Form and, where applicable, the Ancillary Documentation must be in the form included with the Invitation, and may not be made on the basis that it is subject to any terms and conditions other than those specified in the Invitation. 3.7 When an Application will not be accepted Unless otherwise determined by the Board, an Application will not be accepted if at the time the Company received the duly signed and completed Application Form together with all Ancillary Documentation: (a) the applicant is not an Eligible Participant; (b) notice of termination of the applicant's Engagement Arrangement has been given (whether by the applicant or by one or more members of th e Group); or (c) the Board has determined that the applicant is no longer eligible to participate in the Plan. 3.8 Right to nominate (a) Unless otherwise expressly permitted in the Invitation, an Eligible Participant may only submit an Application in the Eligible Part icipant's name and not on behalf of any other person. (b) If an Eligible Participant is permitted in the Invitation, the Eligible Participant may, by notice in writing to the Board, nominate a Nominated Party in whose favour the Eligible Participant wishes to renounce the Invitation in order for the Nominated Party to be granted the Securities the subject of the Invitation. (c) The Board may in its discretion resolve not to allow a renunciation of an Invitation in favour of a Nominated Party without giving any reas on for that decision . For the avoidance of doubt, the Board will not facilitate the renunciation of the Invitation as set out in clause 3.8(b) in favour of the No minated Party where to do so would be inconsistent with: (i) ASIC Class Order 14/1000; or Employee Securities Incentive Plan Page 11 (ii) any covenant or other provision set out in an exemption or modification granted from time to time by ASIC in respect of the Plan or which applies to the Plan pursuant to ASIC's power to exempt or modify the Corporations Act. (d) If the Board resolves to allow a renunciation of an Invitation in favour of a Nominated Party: (i) the Board may impose any such conditions that it thinks fit in respect of that renunciation; and (ii) the Eligi ble Participant must procure that the permitted Nominated Party accepts the Invitation made to the Eligible Participant and that both the Eligible Participant and the Nominated Party agree to be bound by the Rules and execute any documents required by the Company in order to receive the grant and to give effect to these Rules. (e) If Securities are granted to a Nominated Party nominated by an Eligible Participant, then to the extent necessary to give effect to the intent of these Rules, the Eligible Participant will continue to be treated as the Participant. 3.9 Multiple Invitations The Board may invite an Eligible Participant to apply for any number and type of Security, notwithstanding that the Eligible Participant has previously been invited to apply for Securities. 4. Grant of Securities 4.1 Company to grant Securities Following receipt of a duly completed and signed Application Form together with all applicable Ancillary Documentation, the Company will, to the extent that it has accepted such Application, grant the Participant the relevant number and type of Securities, subject to the terms and conditions set out in the Invitation, these Rules and the Ancillary Documentation. 4.2 Certificate of Security Following the grant of a Security, the Company will issue to th e Participant a Certificate. Employee Securities Incentive Plan Page 12 5. Terms of Convertible Securities 5.1 Participant's rights Prior to a Convertible Security being exercised in accordance with clause 7 : (a) a Participant does not have any interest (legal, equitable or otherwise) in any Share the subject of the Convertible Security other than those expressly set out in these Rules; and (b) a Participant is not entitled to: (i) notice of, or to vote or attend at, a meeti ng of the shareholders of the Company; and (ii) receive any dividends declared by the Company, by virtue of holding the Convertible Security. 5.2 Restriction of dealing Unless determined otherwise by the Board in its absolute discretion, or the relevant dealing is effected by force of law on death or legal incapacity to the Participant's legal personal representative, a Participant may not sell, assign, transfer, grant a Security Interest over , collateralise a margin loan against , utilise for the purposes of short s elling, enter into a Derivative with reference to, or otherwise deal with a Convertible Security that has been granted to them . The Convertible Security is forfeited immediately on purported sale, assignment, transfer, dealing or grant of a Security Inter est other than in accordance with these Rules. 5.3 Prohibition on hedging A Participant must not enter into any arrangement for the purpose of hedging their economic exposure to a Convertible Security that has been granted to them. For the avoidance of doubt, a Participant includes any contractor or consultant to a member of the Group. 5.4 Register of Convertible Securities Each Convertible Security granted under these Rules will be registered in the appropriate register of the Company. 5.5 Listing Unless determined o therwise by the Board in its absolute discretion, a Convertible Security granted under the Plan will not be quoted on the ASX or any other recognised exchange. Employee Securities Incentive Plan Page 13 6. Vesting of Convertible Securities 6.1 Vesting A Convertible Security will vest when a Vesting Notice in respect of that Convertible Security is given to the Participant. 6.2 Waiver of Vesting Condition A Vesting Condition for a Convertible Security may, subject to Applicable Laws, be waived by the Board by written notice to the relevant Participant and on such terms and conditions as determined by the Board and set out in that notice. 7. Exercise of Convertible Securities 7.1 Exercise of Convertible Securities (a) A Convertible Security may not be exercised unless and until that Convertible Security has vested in accordance with clause 6 , or such earlier date on which the Participant is entitled to exercise that Convertible Security in accordance with these R ules. (b) To exercise a Convertible Security , the Participant must: (i) deliver a signed Notice of Exercise; and (ii) subject to clause 7.2 , pay the Exercise Pri ce (if any) to or as directed by the Company, at any time prior to the earlier of: (iii) any date specified in the Vesting Notice; and (iv) the Expiry Date. For the avoidance of doubt and subject to clause 7.2 , the total Exercise Price payable by the Participant on exercise of their Convertible Securities is the Exercise Price multiplied by the number of Convertible Securities being exercised by that Participant , rounded up to the nearest cent. (c) If the Participant does not deliver a signed Notice of Exercise and (subject to clause 7.2 ) pay the Exercise Price to or as directed by the Company in relation to a Convertible Security by the requisite date, that Convertible Security will automatically be forfeited. Employee Securities Incentive Plan Page 14 7.2 Cashless exercise of Convertible Securities A t the time of exercise of the Convertible Securities, subject to Board approval at that time, the Participant may elect not to be required to provide payment of the Exercise Price for the number of Convertible Securities specified in a Notice of Exercise but that on exercise of those Convertible Securities the Company will transfer or allot to the Participant that number of Shares equal in value to the positive difference between the then Market Value of the Shares at the time of exercise and the Exercise Price that would otherwise be payable to exercise those Convertible Securit ies (with the number of Shares rounded down to the nearest whole Share). 8. Delivery of Shares on exercise of Convertible Securities As soon as practicable after the valid exercise of a Convertible Security by a Pa rticipant in accordance with clause 7 , the Company will: (a) issue, allocate or cause to be transferred to that Participant the number of Shares to which the Participa nt is entitled under these Rules; and (b) issue a substitute Certificate for any remaining unexercised Convertible Securities held by that Participant. 9. Forfeiture of Convertible Securities 9.1 Leaver Where a Participant who holds Convertible Securities becomes a L eaver, all unvested Convertible Securities will automatically be forfeited by the Participant, unless the Board otherwise determines in its discretion to permit some or all of the Convertible Securities to vest. 9.2 Fraudulent or dishonest actions Where the Board determines that a Participant has: (a) acted fraudulently or dishonestly; or (b) acted negligently; or (c) acted in contravention of a Group policy, including but not limited to the any one or more of the following: (i) anti - bribery and anti - corruption policy; (ii) board charter; (iii) continuous disclosure policy; Employee Securities Incentive Plan Page 15 (iv) code of conduct; (v) securities trading policy , and in particular, where a Participant engages in trading during a blackout period or otherwise trades in a manner that may contravene the insider trading provisions in the Corporations Act ; (vi) social media policy; and (vii) statement of values; or (d) wilfully breached his or her duties to the Group , including but not limited to breaching a material term of an employment, executive services or consultancy agreement (or equivalent) , the Board may in its discretion deem all unvested Convertible Securities held by that Participant to have been forfeited. 9.3 Failure to satisfy Vesting Conditions Unless otherwise stated in the Invitation or determined by the Board, a Convertible Security w hich has not yet vested will be forfeited immediately on the date that the Board determines (acting reasonably and in good faith) that any applicable Vesting Conditions have not been met or cannot be met by the relevant date. 9.4 Insolvency Unless otherwise st ated in the Invitation or determined by the Board, a Convertible Security held by a Participant in accordance with these Rules will be forfeited immediately on the date that the Participant becomes Insolvent. 9.5 Other forfeiture events Unless the Board otherw ise determines, or as otherwise set out in these Rules, any Convertible Securities which have not yet vested will be automatically forfeited on the Expiry Date. 9.6 Discretion to determine that the Convertible Securities are not forfeited Notwithstanding claus es 9.1 to 9.5 (inclusive), the Board ma y decide (on any conditions which it thinks fit) that some or all of the Participant ' s Convertible Securities will not be forfeited at that time, but will be forfeited at the time and subject to the conditions it may specify by written notice to the Partic ipant. 9.7 Voluntary forfeiture A Participant may by written notice to the Company voluntarily forfeit their Convertible Securities for no consideration. Employee Securities Incentive Plan Page 16 9.8 Application of Part 2D.2 Division 2 of the Corporations Act (a) This clause 9.8 applies to all termination payments to which Part 2D.2 Division 2 of the Corporations Act applies. (b) Notwithstanding any other provision of these Rules, in the absence of shareholder approval, the Company is not required to provide, or procure the provision, of any benefit under these Rules which is not permitted by Part 2D.2 Division 2 of the Corporations Act. (c) Any benefits required to be provided to a Participant in accordance with these Rules will, by operation of this clause, be reduced to ensure compliance with Part 2D.2 of the Corporations Act and the provision of such reduced benefit shall constitute full satisfaction of the obligations of each member of the Group . In the event of overpaym ent to a Participant, the Participant must, on receiving written notice from the Board, immediately repay any monies or benefits specified in such notice to ensure compliance with Part 2D.2 of the Corporations Act. (d) Where clause 9.8(b) applies, the Company may seek or not seek shareholder approval in its discretion. 10. Effect of Forfeiture of Convertible Securit ies Where a Convertible Security has been fo rfeited in accordance with these Rules: (a) the Convertible Securit y will automatically lapse; (b) the Participant or the Participant's agent or attorney must sign any transfer documents required by the Company to effect the forfeiture of that Convertible Securit y ; and (c) the Company will not be liable for any damages or other amounts to the Participant in respect of that Convertible Securit y . 11. Change of Control Notwithstanding any other provisions of the Rules, if a Change of Control Event occurs, or the Board determi nes that such an event is likely to occur, the Board may in its discretion determine the manner in which any or all of the Participant's Convertible Securities will be dealt with, including, without limitation, in a manner that allows the Participant to pa rticipate in and/or benefit from any transaction arising from or in connection with the Change of Control Event. Employee Securities Incentive Plan Page 17 12. Rights attaching to Plan Shares 12.1 Plan Shares to rank equally All Plan Shares will rank pari passu in all respects with the Shares of the same cl ass for the time being on issue except for any rights attaching to the Shares by reference to a record date prior to the date of the allotment or transfer of the Plan Shares. 12.2 Listing If Plan Shares are in the same class as Shares which are listed on the AS X, the Company will apply for quotation of the Plan Shares issued (or any unquoted Plan Shares transferred) within the time required by the Listing Rules after the date of allotment. 12.3 Dividends A Participant will be entitled to any dividends declared and di stributed by the Company on the Plan Shares which, at the closing date for determining entitlement to such dividends, are standing to the account of the Participant (or a Trustee for and on behalf of the Participant). 12.4 Dividend reinvestment plan A Participa nt may participate in any dividend reinvestment plan operated by the Company in respect of Plan Shares held by the Participant (or a Trustee for and on behalf of the Participant) . Shares issued under any dividend reinvestment plan operated by the Company will be subject to the same terms and conditions as the Plan Shares held by the Participant (or a Trustee for and on behalf of the Participant) unless the Board determines otherwise. 12.5 Voting rights A Participant may exercise any voting rights attaching to P lan Shares held by the Participant (or a Trustee for and on behalf of the Participant). 13. Disposal Restrictions on Plan Shares 13.1 Disposal restriction If the Invitation provides that any Plan Shares are subject to any restrictions as to the disposal or other de aling by a Participant for a period, the Board may implement any procedure it deems appropriate to ensure the compliance by the Participant with this restriction, including but not limited to imposing an ASX Holding Lock (where applicable) on the Plan Shar es or using an employee share trust to hold the Plan Shares during the relevant restriction period. Employee Securities Incentive Plan Page 18 13.2 Participant's undertaking For so long as a Plan Share is subject to any disposal restrictions under this Plan, the Participant will not: (a) transfer, encumber or otherwise dispose of, or have a Security Interest granted over that Plan Share; or (b) take any action or permit another person to take any action to remove or circumvent the disposal restrictions without the express written consent of the Company. 13.3 Expiry of restriction Subject at all times to the Share Trading Policy, upon the expiry of any disposal restrictions over a Plan Share, the Company will take all action necessary to ensure that the Participant can deal with that Plan Share. 13.4 Share entitlem ents For the avoidance of doubt, the imposition of a disposal restriction on a Plan Share held by a Participant will not affect the Participant's entitlement to receive a notice of, or to vote or attend at, a meeting of the members of the Company, and to r eceive any dividends declared by the Company during the relevant disposal restriction period on that Plan Share . If an employee share trust arrangement is implemented in respect of this Plan, the Board may implement such procedures it deems appropriate to give effect to the intent of this clause 13.4 . 14. Irrevocable Power of Attorney In order to ensure compliance with these Rules, each Participant must grant an irrevoc able power of attorney (in the form set out in the Invitation or such other form determined by the Board) to any person nominated from time to time by the Board. 15. Adjustment of Convertible Securit ies 15.1 Reorganisation If there is a reorganisation of the issued share capital of the Company (including any subdivision, consolidation, reduction, return or cancellation of such issued capital of the Company), the rights of each Participant holding Convertible Securities will be changed to the extent necessary to comp ly with the Listing Rules applicable to a reorganisation of capital at the time of the reorganisation. Employee Securities Incentive Plan Page 19 15.2 Bonus Issue (a) If Shares are issued by the Company pro rata to shareholders generally by way of bonus issue (other than an issue in lieu of dividends or by way of dividend reinvestment), the holder of Convertible Securities is entitled, upon exercise of the Convertible Securities, to receive, in addition to the Shares in respect of which the Convertible Securities are exercised and without the payment of any further consideration, an allotment of as many additional Shares as would have been issued to a shareholder who, on the date for determining entitlements under the bonus issue, held Shares equal in number to the Shares in respect of which the Convertible S ecurities are exercised. (b) Additional Shares to which the holder of Convertible Securities becomes so entitled will, as from the time Shares are issued pursuant to the bonus issue and until those additional Shares are allotted, be regarded as Shares in respect of which the Convertible Securities are exercised for the purposes of subsequent appli cations of clause 15.2(a) , and any adjustments which, after the time just mentioned, are made under clause 15.1 to the number of Shares will also be made to the additional Shares. 15.3 Rights Issue Unless otherwise determined by the Board, a holder of Convertible Securities does not have the right t o participate in a pro rata issue of Shares made by the Company or sell renounceable rights . 15.4 No other participation Subject to clauses 15.1 to 15.3 (inclusive), during the currency of any Convertible Securities and prior to their exercise, the holders of Convertible Securities are not entitle d to participate in any new issue of Shares of the Company as a result of their holding of Convertible Securities . 15.5 Rounding Until a Convertible Security is exercised, all calculations adjusting the number of Shares must be carried out to include all fracti ons, but when a Convertible Securit y is exercised and is settled in Shares the number of Shares to be issued or transferred to the Participant is rounded down to the next lowest whole number . 15.6 Application of adjustment (a) In th e application of this clause 15 , the Board may (as far as possible) make whatever adjustments it deems necessary or desirable to ensure that the consequences of that application are fair as between the Participants and the holders of other securities in the Company, subject to the Listing Rules and other Applicable Laws. Employee Securities Incentive Plan Page 20 (b) Unless otherwise provided in these Rules, a Participant has no right to: (i) change the Exercise Price; or (ii) change the number of Shares over which the Convertible Security can be exercised. 16. Administration of the Plan 16.1 Board administration The Plan will be administered by the Board . For the avoidance of doubt, the Board may make further provisions for the operation of the Plan which are consistent with th ese Rules. 16.2 Board powers and discretions Any power or discretion which is conferred on the Board by these Rules may be exercised in its sole and absolute discretion . The Board does not, in exercising any power or discretion under these Rules, owe any fiduc iary or other obligations to any Eligible Participant or Participant. 16.3 Delegation of Board powers and discretions Any power or discretion which is conferred on the Board by these Rules (including, without limitation, the power to invite Eligible Participant s to participate in the Plan and to determine the terms and conditions of the Securit ies) may be delegated by the Board to: (a) a committee consisting of such directors, other officers or employees of the Group, or any combination of such persons as the Board thinks fit; (b) a member of the Group; or (c) a third party, for such periods and on such conditions as the Board thinks fit . 16.4 Documents The Company may from time to time require an Eligible Participant invited to participate in the Plan or a Participant or a per son nominated by an Eligible Participant under clause 3.8 to complete and return such other documents as may be required by law to be completed by that person or e ntity, or such other documents which the Company considers should, for legal, taxation and/or administrative reasons, be completed by that Eligible Participant, Participant or person in order to give effect to the intent of the Plan. Employee Securities Incentive Plan Page 21 16.5 Decisions final Every exercise of a discretion by the Board (or its delegates) and any decision by the Board (or its delegates) regarding the interpretation, effect or application of these Rules and all calculations and determination made by the Board under these Rules are fina l, conclusive and binding in the absence of manifest error. 17. Trust The Board may, in its discretion, use an employee share trust or other mechanism for the purposes of holding Shares and Plan Shares before or after the exercise of a Convertible Securit y or delivering any Plan Shares arising from exercise of a Convertible Security under these Rules on such terms and conditions as determined by the Board . For the avoidance of doubt, the Board may do all things necessary for the establishment, administration, operation and funding of an employee share trust. 18. Restrictions on and amendments to the Plan 18.1 Compliance with Applicable Laws (a) Notwithstanding these Rules or any terms of a Security, no Security may be offered, granted, vested or exercised, and no Share may be issued or transferred, if to do so would contravene any Applicable Laws. (b) In particular, the Company must have reasonable grounds to believe, when making an Invitation, that the total number of Plan Shares that may be issued, or acquired upon exercise of Convertible Securities offered, under an Invitation, when aggregated with the number of Shares issued or that may be issued as a result of offers made in reliance on ASIC Class Order 14/1000 at any time during the previous 3 year period under: (i) an employee incentive scheme covered by ASIC Class Oder 14/1000; or (ii) an ASIC exempt arrangement of a similar kind to an employee incentive scheme, but disregarding any offer made or securities issued in the capital of the Company by way of or as a result of: (iii) an offer to a person situated at the time of receipt of the offer outside Australia; (iv) an offer that did not need disclosure to investors because of section 708 of the Corporations Act (exempts the requirement for a disclosure document for the issue of secu rities in certain circumstances to investors who are deemed to have sufficient investment knowledge to Employee Securities Incentive Plan Page 22 make informed decisions, including professional investors, sophisticated investors and senior managers of the Company); or (v) an offer made under a disclos ure document, would exceed 5% (or such other maximum permitted under any Applicable Law) of the total number of Shares on issue at the date of the Invitation. For the purposes of Listing Rule 7.2 Exception 13, the maximum number of Securities that may be issued under the Plan is 3,780,000 Securities , or such number as is otherwise approved by Shareholders from time to time. 18.2 Amendment of Plan (a) Subject to clause 18.2(b) , the Board may: (i) at any time amend any provisions of these Rules, including (without limitation) the terms and conditions upon which any Securities have been granted under the Plan; and (ii) deter mine that any amendments to these Rules be given retrospective effect, immediate effect or future effect. (b) No amendment to any provision of these Rules may be made if the amendment materially reduces the rights of any Participant as they existed before the date of the amendment, other than an amendment: (i) introduced primarily: (A) for the purposes of complying with or conforming to present or future legislation governing or regulating the Plan or like plans; (B) to correct any manifest error or mistake; (C) to allow the i mplementation of an employee share trust arrangement pursuant to clause 17 ; (D) to enable the Plan or any member of the Group to comply with its constit uent documents, and any other Applicable Laws; and/or (E) to take into consideration possible adverse taxation implications in respect of the Plan including changes to applicable taxation legislation or the interpretation of that legislation by a court of comp etent jurisdiction or any rulings from taxation authorities administering such legislation; or (ii) agreed to in writing by all Participant(s). (c) As soon as reasonably practicable after making any amendment to any provision of these Rules, the Board will give not ice of the amendment to each Participant affected by the amendment . Failure by the Board to notify a Employee Securities Incentive Plan Page 23 Participant of any amendment will not invalidate the amendment as it applies to that Participant. 19. Duration 19.1 Termination The Plan Continues in operation un til the Board decides to end it. 19.2 Suspension The Board may from time to time suspend the operation of the Plan for a fixed period or indefinitely, and may end any suspension. 19.3 Effect of termination / suspension If the Plan is terminated or suspended for any reason, that termination or suspension must not prejudice the accrued rights of the Participants . 19.4 Cancellation of Convertible Securities Notwithstanding any other provisions of these Rules, but subject at all times to any Applicable Laws and regulat ions, if a Participant and the Company (acting by the Board) agree in writing that some or all of the Securities granted to that Participant are to be cancelled on a specified date or on the occurrence of a particular event, then those Securities may be ca ncelled in the manner agreed between the Company and the Participant . 20. Miscellaneous 20.1 Rights of Participants Nothing in these Rules: (a) confers on any person any right or expectation to become a Participant, or the right to be invited to apply for, or be off ered or to receive any Securities ; (b) confers on any person the right to continue as an employee or officer of any member of the Group (as the case may be); (c) affects the rights of any member of the Group to terminate the Engagement Arrangement of an Eligible P articipant; (d) forms part of any contract of service between an Eligible Participant and any member of the Group; Employee Securities Incentive Plan Page 24 (e) may be used to increase rights of compensation or damages in any action brought against a member of the Group in respect of an Engagement Arrange ment; (f) confers any legal or equitable right on an Eligible Participant whatsoever to take action against any member of the Group in respect of their Engagement Arrangement; or (g) confers on an Eligible Participant any rights to compensation or damages in conse quence of the termination of their Engagement Arrangement by any member of the Group for any reason whatsoever including ceasing to have rights under the Plan as a result of such termination. 20.2 Non - exclusivity (a) This Plan is not the sole means by which all mem bers of the Group intend to provide incentives to Eligible Participants . Nothing in this Plan is intended to restrict any member of the Group from remunerating or otherwise rewarding employees or directors of any member of the Group outside the Plan. (b) Part icipation in the Plan does not affect, and is not affected by, participation in any other incentive or other scheme operated by any member of the Group unless the terms of that other scheme provide otherwise. 20.3 Notice (a) Any notice or other communication under or concerning the Plan is validly given: (i) to a Participant, if delivered personally to the addressee or sent by prepaid post to the Participant's last known residential address, or sent to the Participant by facsimile or email at the Participant's place of work; and (ii) to the Company, if delivered or sent by prepaid post addressed to the company secretary at the Company's registered office (or any other address the Board specifies), or as otherwise notified by the Company from time to time. (b) Delivery of notices Subject to clause 20.3(a) , a notice or other communication will be deemed to have been served: (i) if delivered by hand, at the time of delivery; (ii) if sent by facsimile or electronic mail, on receipt of a successful transmission notice, return receipt or such other confirmation by which the sender can reasonably verify delivery; or Employee Securities Incentive Plan Page 25 (iii) if posted, and provided it is properly addressed and stamped, 48 hours after mail ing in Australia and 7 days after mailing outside Australia. 20.4 Further assurances All parties that have agreed to be bound by these Rules must do all things reasonably necessary to give full effect to this Plan and the transactions contemplated by this Plan. 20.5 Costs and charges (a) The Company will be responsible for any brokerage, commission, stamp duty or other costs payable in relation to the issue or transfer of Plan Shares to or on behalf of a Participant. (b) Each Participant will be responsible for all costs ass ociated with the disposal of a Plan Share by that Participant. 20.6 No representation or warranty (a) The Company makes no representation or warranty as to the value of Securit ies or with respect to any tax matters affecting any Eligible Participant or Participant in connection with the Plan . (b) Neither the Company, nor any of its directors, officers or employees are liable for anything done or omitted to be done by such person or any other person with respect to price, time, quantity or other conditions and circumst ances of the issue or acquisition of Shares hereunder, with respect of any fluctuations in the market price of Shares, or in any other manner related to the Plan. 20.7 Data protection By participating in the Plan, the Participant consents to the holding and pro cessing of personal data provided by the Participant for the purposes of the Plan . These purposes include, but are not limited to: (a) administering and maintaining records held in respect to a Participant; (b) providing information to members of the Group, regis trars, brokers or third party administrators of the Plan (if any) or advisers of the Board; and (c) providing information to corporate advisers or potential future third party purchasers in connection with a sale of shares in a member of the Group, or the busi ness and assets of a member of the Group. 20.8 Governing law (a) This Plan is governed by the laws of Western Australia , Australia. (b) Each Participant submits to the non - exclusive jurisdiction of the courts of Western Australia , Australia, and the courts competent to determine appeals Employee Securities Incentive Plan Page 26 from those courts, with respect to any proceedings that may be brought in connection with these Rules. 20.9 Waiver of rights (a) A waiver of any right, power, authority, discretion or remedy arising upon a breach of or default under these Rules m ust be in writing and signed by the party granting the waiver, and may be subject to such terms and conditions as determined by the party granting the waiver. (b) A failure or delay in the exercise, or partial exercise, of a right, power, authority, discretion or remedy arising from a breach of or default under these Rules, does not prevent the exercise of or result in a waiver of that right, power, authority, discretion or remedy. (c) A party is not entitled to rely on a delay in the exercise or non - exercise of a right, power, authority, discretion or remedy arising from a breach of these Rules or default under these Rules as constituting a waiver of that right, power, authority, discretion or remedy. (d) A party may not rely on any conduct of another party as a defenc e to the exercise of a right, power, authority, discretion or remedy by that other party. (e) A waiver is only effective in the specific instance and for the specific purpose for which it is given and subject to any specific terms and conditions as specified i n the waiver. (f) This clause may not itself be waived except in writing.
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