UNITED STATES
SECURITIES AND EXCHANGEEXCSHANGE COMMISSIONWashington,
the Securities Exchange Act of 1934 (Amendment No. )
Filed by a Party other than the Registrant ☐ Check the appropriate box: ☐ Preliminary Proxy Statement ☐ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) ☒ Definitive Proxy Statement ☐ Definitive Additional Materials ☐ Soliciting Material Pursuant to Section §240.14a-12 THERAVANCE BIOPHARMA, INC. | ||
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March 21, 2018
You are cordially invited to attend the 2018Theravance Biopharma, Inc.:
Details regarding admission In light of the ongoing coronavirus pandemic, we urge you not to attend the Annual Meeting in person this year but rather vote your shares by completing, signing and returning the enclosed proxy card, or following the instructions on the enclosed proxy card to submit your proxy via telephone or on the Internet. You may listen to the Annual Meeting andat https://theravance.zoom.us/j/98644884241.
Meeting.
![[MISSING IMAGE: sg_rickewinningham-bw.jpg]](https://files.docoh.com/DEF 14A/0001104659-21-039784/sg_rickewinningham-bw.jpg){kind=small}
Chief Executive Officer and Chairman
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THERAVANCE BIOPHARMA, INC.
P.O. Box 309, Ugland House
Grand Cayman, KY1-1104
Cayman Islands
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Time and Date: | | April 27, 2021 at | | |||
| Place: | | | Theravance Biopharma Ireland Limited, Connaught House, 1 Burlington Road, Dublin 4 Ireland | | |
| Items of Business: | | | (1) To elect the following three directors to serve as Class I members of the board of directors until the annual general meeting held in | | |
| | | | (2) To approve a non-binding proposal to ratify the appointment of Deepika R. Pakianathan to serve as a Class III member of the board of directors until the annual general meeting held in 2023 and until her successor is duly elected and qualified. | | ||
| | | | | (3) To ratify the appointment of Ernst & Young LLP as Theravance Biopharma, Inc. | | |
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(4) | To transact such other business as may properly come before the annual general meeting or any adjournment thereof. | | ||||
| | | | | These items of business are more fully described in the proxy statement accompanying this notice. | | |
| Adjournments: | | | Any action on the items of business described above may be considered at the annual general meeting at the time and on the date specified above or at any time and date to which the annual general meeting may be properly | | |
| Record Date: | | | You are entitled to vote if you were a shareholder of record as of the close of business on March | | |
| Voting: | | | Your vote is very important. | |
All shareholders are cordially invited to attend the annual general meetingmeeting; however, in person.
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March 21, 2018
You are cordially invitedlight of the ongoing coronavirus pandemic, we urge you not to attend the annual general meeting in person. Whether or not you expect to attend the annual general meeting, pleaseperson but rather complete, date, sign and return the enclosed proxy card, or vote via telephone or on the Internet as instructed in these materials.
Chief Executive Officer and Chairman
Annual
General Meeting to be held on Tuesday,
The proxy statement and annual report are available at http://investor.theravance.com/proxy
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All references to “elect”, “elected” or “election” with respect to directors shall be construed as “appoint”, “appointed” or “appointment” under Cayman Islands law.
Under the laws of the Cayman Islands, abstentions
Meeting, each holder of ordinary shares of Theravance Biopharma will be entitled to one vote per ordinary share held as of the close of business on the Record Date. We do not have cumulative voting rights for the election of directors.
•
(1)
Deepika R. Pakianathan as a director is advisory, and therefore not binding on our board of directors. Our board of directors values the opinions of our shareholders, however, and will carefully review and consider the voting results when evaluating our appointment of directors to our board of directors. As with Proposal TwoOne, you may vote “FOR,” “AGAINST” or “ABSTAIN.” Abstentions and broker non-votes will not affect the outcome of the Proposal, other than counting towards the quorum of the meeting.
Proposal Three—A majority of the votes duly cast is required to adopt the Shelf Rights Plan Resolution. If the number of shares voted "FOR" the Shelf Rights Plan Resolution exceeds the number of votes cast "AGAINST," the Shelf Rights Plan Resolution will be adopted. As with Proposals One and Two, you may vote "FOR," "AGAINST" or "ABSTAIN" and abstentions and broker non-votes will not affect the outcome of the election, other than counting towards the quorum of the meeting.
(1)
Three.
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Young LLP. Your bank, broker, trustee or other nominee will not have discretion to vote on (i) the election of directors orand (ii) the Shelf Rights Plan Resolutionnon-binding proposal to ratify the appointment of Deepika R. Pakianathan to serve as a Class III member of the board of directors absent direction from you as each is a "non-routine"“non-routine” matter.
nominee.
- Q:Where can I find the voting results of the Annual Meeting?A:
A:We intend to announce preliminary voting results at the Annual Meeting and will disclose the final results in a current report on Form 8-K within four business days after the Annual Meeting.Q:What is the deadline to propose actions for consideration at nextyear'syear’s annual general meeting or to nominate individuals to serve as directors?A:A:You may submit proposals, including director nominations, for consideration at future shareholder meetings.Requirements for shareholder proposals to be considered for inclusion in our proxy materials ——Shareholders may present proper proposals for inclusion in our proxy statement and for consideration at our next annual general meeting by submitting their proposals in writing to our Secretary in a timely manner. In order to be considered for inclusion in the proxy statement for the20192022 annual general meeting, shareholder proposals must be received at our principal executive offices no later than November21, 201825, 2021 (that is, not less than 120 calendar days before the one year anniversary of the date this proxy statement was released to shareholders in connection with the20182021 Annual Meeting), and must otherwise comply with the requirements of Rule 14a-8 of the Securities Exchange Act of 1934, as amended (the"Exchange Act"“Exchange Act”). A copy of all notices of proposals by shareholders should also be sent to us care of our U.S. subsidiary, Theravance Biopharma US, Inc., at 901 Gateway Boulevard, South San Francisco, California 94080, Attention: Secretary.Requirements for shareholder proposals to be brought before an annual general meeting ——In addition, our Amended and Restated Memorandum and Articles of Association establish an advance notice procedure for shareholders who wish to present certain matters before an annual general meeting. In
prior to the meeting; provided, however, that in the event less than 130 days'days’ notice or prior public disclosure of the date of the meeting is given or made to shareholders, notice by the shareholder to be timely must be so received not later than the close of business on the 10th day following the earlier of the day on which such notice of the date of the meeting was mailed or such public disclosure was made.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL GENERAL MEETING TO BE HELD ON
APRIL 27, 2021.
ELECTION OF DIRECTORS
qualified or until his or her earlier death, resignation or removal.
| Name | | | Age | | | ||
| Principal Occupation and Business Experience | | ||||||
| Eran Broshy | | | | | Eran Broshy has served as a director since June 2014. Mr. Broshy has been | ||
| (June 2009 — December 2012). Mr. Broshy previously served for over a decade as the chief executive officer (until 2008) and chairman of the board of directors (until 2010) of inVentiv Health, Inc., a privately held company (and until August 2010 a Nasdaq listed company) that delivers a broad range of clinical and commercialization services to pharmaceutical and life sciences companies globally. Prior to joining inVentiv, Mr. Broshy was a management consultant with The Boston | | |||||
| Name | | | Age | | | Principal Occupation and Business Experience | |
| | | | | | | Consulting Group (BCG) for 14 years, including as the partner responsible for | |
Laurie Smaldone Alsup | | | | | Laurie Smaldone Alsup, M.D. has served as a director since February 2018. Dr. Smaldone Alsup is Chief |
| regulatory and clinical experience in the life sciences industry, senior management experience in several companies in our industry and demonstrated leadership in her field contributed to our | | ||||||
Burton G. Malkiel | | | | | Burton G. Malkiel, Ph.D., has served as a director since October 2013. Prior to our spin-off from Innoviva, Inc. | | |
| Name | | | Age | | | Principal Occupation and Business Experience | |
| | | | | | | company, a position he has held since November 2012, and the Chemical Bank | |
| Name | | | Age | | | ||
| Principal Occupation and Business Experience | | ||||||
| Rick E Winningham | | | | | Rick E Winningham has served as Chairman of the board of directors since July 2013. He has served as our Chief Executive Officer since our spin-off from Innoviva in June 2014. From October 2001 to August 2014, Mr. Winningham served as Chief Executive Officer of Innoviva, where he also served as Chairman of the board of directors from April 2010 to October 2014. From 1997 to 2001 he served as President, | ||
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| Name | | | Age | | | Principal Occupation and Business Experience | |
| | | | | | | company, and Retrotope Inc, a private biopharmaceutical company, and served as a member of the board of directors of OncoMed Pharmaceuticals, Inc. from June 2015 until April 2019. Mr. Winningham holds an M.B.A. from Texas Christian University and a B.S. degree from Southern Illinois University. We believe that it is appropriate and desirable for our Chief Executive Officer to serve on our board of directors. Mr. | |
Robert V. Gunderson, Jr. | | | | | Robert V. Gunderson, Jr. has served as a director since October 2013. Prior to our spin-off from Innoviva in June 2014 and since September 1999, Mr. Gunderson served as a director of Innoviva. He is a founding partner and, since January 2021, Chairman Emeritus of the law firm of Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP, where he has practiced since | | |
Susan M. Molineaux | | | | | Susan M. Molineaux, Ph.D. has served as a director since April |
| a drug development company. From 1999 to 2000, she served as Vice President of Biology at Praelux, Inc., a biopharmaceutical company, and from 1994 through 1999, she served as Vice President of Drug Development at Praecis Pharmaceuticals, Inc., a biopharmaceutical company. From 1989 until 1994, she was a scientist in the Immunology group at Merck & Co. Dr. Molineaux also serves as a member of the board of directors of Geron Corporation, a biopharmaceutical company and served as a member of the board of directors of the California Life Sciences Association until March 2016. In June 2017, Dr. Molineaux joined the board of trustees of Smith | | |||||
| Name | | | Age | | | Principal Occupation and Business Experience | |
| | | | | | | from Johns Hopkins University, and she completed a postdoctoral fellowship at Columbia University. Dr. | |
Donal | | | | | Donal |
| and financing matters contributed to our | | |||||
| Name | | | Age | | | ||
| Principal Occupation and Business Experience | | ||||||
| Dean J. Mitchell | | | | | Dean J. Mitchell has served as a director since June 2014. Mr. Mitchell | | |
| Name | | | Age | | | Principal Occupation and | |
| | | | | | | Mr. Mitchell served as President and Chief Executive Officer of Lux Biosciences, Inc., a biotechnology company focusing on the treatment of ophthalmic diseases, from July 2010 to August 2013. Prior to Lux Biosciences, he served as President and Chief Executive Officer of both Alpharma, Inc., a publicly traded specialty pharmaceutical company, from 2006 until its acquisition by King Pharmaceuticals, Inc. in 2008, and Guilford Pharmaceuticals, Inc., a publicly traded pharmaceutical company focused in oncology and acute care, from 2004 until its acquisition by MGI Pharma Inc. in 2005. From 2001 to 2004 he served in various senior executive capacities in the worldwide medicines group of | |
| | | Deepika R. Pakianathan, Ph.D., has served as a |
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George M. Whitesides | | | | | George M. Whitesides, Ph.D., has served as a director since October 2013. | | |
| Name | | | Age | | | Principal Occupation and Business Experience | |
| | | | | | | member of the Massachusetts Institute of Technology from 1964 to 1982. Dr. Whitesides was a 1998 recipient of the National Medal of Science. He is a member of the editorial boards of 15 scientific journals. He is also a member of the board of directors of | |
William D. Young | | | | | William D. Young has served as a director since October 2013 and has served as our lead independent director since April 2014. Prior to our spin-off from Innoviva in June 2014 and since April 2001, Mr. Young served as a director of Innoviva. He has been a Senior Advisor of Blackstone Life Sciences since 2018, when Blackstone Life Sciences acquired Claris Ventures. He was a Venture Partner at |
| Mr. Young received his M.B.A. from Indiana University and his B.S. in Chemical Engineering from Purdue University, and an honorary Doctorate of Engineering from Purdue University. Mr. Young was elected to The National Academy of Engineering in 1993 for his contributions to biotechnology. Mr. | | |||||
ADVISORY VOTE REGARDING RATIFICATION OF THE APPOINTMENT OF
DEEPIKA R. PAKIANATHAN TO SERVE AS A CLASS III MEMBER OF THE BOARD OF DIRECTORS
OF THE APPOINTMENT OF DEEPIKA R. PAKIANATHAN TO SERVE AS A CLASS III MEMBER OF THE BOARD OF DIRECTORS.
RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
2021.
If this proposal does not receive the affirmative approval of a majority of the votes cast on the proposal, the audit committee would reconsider the appointment.
TheServicesThe following table sets forth all fees for invoices received or accrued by us for professional audit services and other services rendered by Ernst & Young LLP during the years ended December 31, 20162019 and 2017.
| | | | Year Ended December 31 | | |||||||||
| | | | 2020 | | | 2019 | | ||||||
| | | | (in thousands) | | | (in thousands) | | ||||||
Audit Fees(1) | | | | $ | 1,602 | | | | | $ | 1,567 | | |
| Audit-Related Fees | | | | | — | | | | | | — | | |
Tax Fees(2) | | | | | 927 | | | | | | 628 | | |
All Other Fees(3) | | | | | 1 | | | | | | 4 | | |
| Total Fees | | | | $ | 2,530 | | | | | $ | 2,199 | | |
| | Year Ended December 31 | ||||||
|---|---|---|---|---|---|---|---|
| | 2017 | 2016 | |||||
| | (in thousands) | (in thousands) | |||||
Audit Fees(1) | $ | 1,422 | $ | 1,518 | |||
Audit-Related Fees | — | — | |||||
Tax Fees(2) | 499 | 558 | |||||
All Other Fees(3) | 2 | 2 | |||||
| | | | | | | | |
Total Fees | $ | 1,923 | $ | 2,078 | |||
| | | | | | | | |
(1)
(1)- For the years ended December 31,
20162019 and2017,2020, this category represents fees for professional services provided in connection with the audit of our financial statements, review of our quarterly financial statements, and audit services provided in connection with other regulatory filings for which only the independent registered public accounting firm can reasonably be expected to provide.
OF THE APPOINTMENT OF ERNST & YOUNG LLP AS OUR
INDEPENDENT REGISTERED PUBLIC ACCOUNTING
TABLE OF CONTENTSPROPOSAL THREE:ADOPTION OF SHELF RIGHTS PLAN RESOLUTION
Overview
Our board of directors has proposed that shareholders adopt the Shelf Rights Plan Resolution approving a new shareholder rights plan (the "Rights Plan") and authorizing our board of directors to adopt and put into effect ("implement") the Rights Plan in the future if and when the board of directors deems appropriate and in the best interests of the Company. The Shelf Rights Plan Resolution also authorizes the board of directors to determine the purchase price of the rights under the Rights Plan, select the rights agent under the Rights Plan, and make such changes to the terms of the Rights Plan as the board of directors deems appropriate and in the best interests of the Company. The full text of the Shelf Rights Plan Resolution is set forth asAnnex A to this proxy statement.
In May 2014, our board of directors implemented a shareholder rights plan (the "Existing Rights Plan") that is currently in effect and will expire in May 2024. The terms of the Existing Rights Plan are contained in a Rights Agreement, dated as of May 9, 2014, as amended by the First Amendment to Rights Agreement, dated as of November 10, 2015, between the Company and Computershare, Inc., as rights agent (together, the "Existing Rights Agreement"). The board of directors has approved an amendment to the expiration date of the rights under the Existing Rights Plan and the Existing Rights Agreement such that the rights under the Existing Rights Plan and the Existing Rights Agreement will terminate subject to and effective upon shareholder adoption of the Shelf Rights Plan Resolution. In other words, if the Shelf Rights Plan Resolution is approved, the Company's Existing Rights Plan will be terminated. If the Shelf Rights Plan Resolution is not approved, the Company's Existing Rights Plan will remain in effect and will not be terminated.
The purpose of the Shelf Rights Plan Resolution is to provide the board of directors with the ability to implement the Rights Plan promptly, without the delay associated with seeking further shareholder approval, if and when the board of directors deems appropriate and in the best interests of the Company. The Company is incorporated in the Cayman Islands, and under Cayman Islands law it is advisable to obtain shareholder approval of the Rights Plan. The board of directors believes that the potential for delay in a situation where the Rights Plan may be necessary would leave the Company highly exposed to potential takeover threats.
If implemented by the board of directors, the Rights Plan is intended to provide the board of directors and shareholders the opportunity to maximize value and secure fair treatment in the event a person (which as used in this summary, would also include affiliates or associates of such person, or a group or persons acting in concert) seeks control of the Company. The Rights Plan is not intended to prevent any change of control of the Company that may be in the best interests of shareholders. The board of directors is not seeking shareholder approval to implement the Rights Plan in response to, or in anticipation of, any known or anticipated takeover bid or other proposal to acquire control of the Company. The board of directors would implement the Rights Plan only in accordance with its fiduciary duties to the Company. If this resolution is approved, the shareholder rights plan currently in effect will be terminated.
Purpose of the Shelf Rights Plan Resolution
As described above, the purpose of the Shelf Rights Plan Resolution is to provide the board of directors with the ability to implement the Rights Plan promptly, without the delay associated with seeking further shareholder approval, if and when the board of directors deems appropriate and in the best interests of the Company. This would allow the Company's board substantially similar flexibility as typically provided to public companies incorporated in Delaware, where a board of directors has the
authority to implement a rights plan without shareholder approval, allowing the Company to move quickly in the event of a takeover threat.
If implemented by the board of directors, the Rights Plan is intended to deter any person from acquiring more than 19.9% of the Company's outstanding ordinary shares (or, if a person already holds more than 19.9% of the Company's outstanding ordinary shares at the time the Rights Plan is implemented, from acquiring additional shares) without the approval of our board of directors. The Rights Plan would be intended to provide adequate time for our board of directors and shareholders to assess an unsolicited takeover bid for the Company, provide the board of directors with sufficient time to explore and develop alternatives for maximizing shareholder value if a takeover bid is made, and provide all shareholders with an equal opportunity to participate in a takeover bid. The Rights Plan would also be intended to prevent the potential adverse impact to shareholders of an accumulation of a significant, potentially controlling, interest in the Company exceeding 19.9% of our outstanding ordinary shares (or prevent the acquisition of additional shares of the Company's ordinary shares by a person whose interest in the Company exceeds 19.9% of our outstanding ordinary shares at the time the Rights Plan is implemented) through a creeping bid, private agreement, or other transaction that would consolidate control in the Company without offering a control premium to other shareholders.
If implemented by the board of directors, the Rights Plan would encourage a potential acquirer considering a takeover bid to engage in discussions with the Company's board of directors. Assuming the Rights Plan is implemented, if the board of directors does not waive the application of the Rights Plan after a person acquires more than 19.9% of the Company's outstanding ordinary shares or announces its intent to do so (or, if a person already holds more than 19.9% of the Company's outstanding ordinary shares at the time the Rights Plan is implemented, after they acquire or announce their intent to acquire additional shares), the Rights Plan would generally permit holders of the Company's ordinary shares, other than the acquirer(s) or potential acquirers, to effectively purchase Company ordinary shares at a substantial discount to the market price, as determined by the board of directors, thus exposing the potential acquirer to a significant dilution of their holdings.
Shareholder approval of the Rights Plan would not relieve the board of directors of its fiduciary duty to consider in good faith any proposal to acquire the Company. Directors are subject to these same fiduciary standards in relation to each board action undertaken with respect to a rights plan, including any future decision to implement a plan.
If implemented by the board of directors, the Rights Plan would not interfere with the day-to-day operations of the Company. The issuance of rights pursuant to the Rights Plan in the future if the board of directors implements the Rights Plan will not in any way alter the financial condition of the Company, impede its business plans, or alter its financial statements. In addition, if implemented by the Board, the Rights Plan would not necessarily be dilutive. However, if the Rights Plan is implemented and thereafter a "Triggering Event" (described below) occurs, causing the rights to separate from the ordinary shares (as described below), reported earnings-per-share and reported cash flow per share on a fully diluted or non-diluted basis may be affected.
The description above and below of the Shelf Rights Plan Resolution and the principal terms and conditions of the Rights Plan is a summary only, is not comprehensive, and is qualified in its entirety by reference to the full text of the Shelf Rights Plan Resolution and the form of Rights Agreement (as amended from time to time, the "Rights Agreement") to be entered into by the Company and the person or entity the board of directors designates as rights agent (the "Rights Agent"), a copy of which is attached as an exhibit to the Shelf Rights Plan Resolution set forth asAnnex A to this proxy statement.
The Rights Plan is not being implemented by the board of directors at this time. Unless and until the board of directors determines in the future that implementation of the Rights Plan is appropriate and in the best interests of the Company, the Rights Plan will have no effect.
The summary of the Rights Plan below assumes that our board of directors has implemented the Rights Plan. It does not represent the current rights of Company shareholders, or the rights of Company shareholders if the Shelf Rights Plan Resolution is approved, unless and until the board of directors determines it is in the best interests of the Company to implement the Rights Plan and implements the Rights Plan.
If the Rights Plan is implemented by the board of directors, the Company will issue one Right (as defined below) in respect of each ordinary share of the Company issued and outstanding at the close of business on the date designated by the board of directors as the record date (the "Rights Plan Record Date"). One Right would also be issued in respect of each ordinary share issued thereafter, but before the Distribution Date (as defined below) or the termination of the Rights Plan Agreement, whichever comes first.
Each "Right" would entitle the registered holder, under certain circumstances, to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Share, par value $0.00001 per share, of the Company (a "Preferred Share") at a price per one one-thousandth of a Preferred Share to be determined by the board of directors at the time of implementing the Rights Plan (the "Purchase Price"), subject to adjustment.
Until the earlier to occur of (i) 10 days following a public announcement that a person and its affiliated or associated persons (with certain exceptions, an "Acquiring Person"), alone or together with a group of other persons acting in concert, has acquired beneficial ownership of 19.9% or more of the issued and outstanding ordinary shares (or if such persons or group already has beneficial ownership of 19.9% or more of the issued and outstanding ordinary shares, has acquired additional shares), or (ii) 10 business days (or such later date as may be determined by action of the board of directors prior to such time as any person or group becomes an Acquiring Person) following the commencement of, or announcement of an intention to make, a tender offer or exchange offer the consummation of which would result in a person or group becoming an "Acquiring Person" (the earlier of such dates being called the "Distribution Date"), the Rights will be evidenced, with respect to any of the ordinary shares certificates issued and outstanding as of the Rights Plan Record Date, by such ordinary shares certificate together with the summary of the Rights attached as an exhibit to the Rights Agreement.
The Rights Agreement provides that, until the Distribution Date (or earlier expiration of the Rights), the Rights will be transferred with and only with the ordinary shares. Until the Distribution Date (or earlier expiration of the Rights), new ordinary shares certificates issued after the Rights Plan Record Date upon transfer or new issuances of ordinary shares will contain a notation incorporating the Rights Agreement by reference. Until the Distribution Date (or earlier expiration of the Rights), the surrender for transfer of any certificates (if any) for ordinary shares issued and outstanding as of the Rights Plan Record Date, even without such notation or a copy of the summary of Rights attached to the Rights Agreement, will also constitute the transfer of the Rights associated with the ordinary shares represented by such certificate. As soon as practicable following the Distribution Date, separate certificates evidencing the Rights ("Right Certificates") will be mailed to holders of record of the ordinary shares as of the close of business on the Distribution Date and such separate Right Certificates alone will evidence the Rights.
The Rights will not be exercisable until the Distribution Date. The Rights will expire on a date designated by the board of directors at the time the Rights Plan is implemented (the "Final Expiration Date"), unless the Final Expiration Date is advanced or extended or unless the Rights are earlier redeemed or exchanged by the Company, in each case as described below.
The Purchase Price payable, and the number of Preferred Shares or other securities or property issuable, upon exercise of the Rights will be subject to adjustment from time to time to prevent dilution to the value of the Rights (i) in the event of a share dividend on, or a subdivision, combination or reclassification of, the Preferred Shares, (ii) upon the grant to holders of the Preferred Shares of certain rights or warrants to subscribe for or purchase Preferred Shares at a price, or securities convertible into Preferred Shares with a conversion price, less than the then-current market price of the Preferred Shares, or (iii) upon the distribution to holders of the Preferred Shares of evidences of indebtedness or assets (excluding regular periodic cash dividends or dividends payable in Preferred Shares) or of subscription rights or warrants (other than those referred to above).
The number of issued and outstanding Rights will be subject to adjustment in the event of a share dividend on the ordinary shares payable in ordinary shares, or subdivisions, consolidations or combinations of the ordinary shares occurring, in any such case, prior to the Distribution Date.
Preferred Shares purchasable upon exercise of the Rights will not be redeemable. Each Preferred Share will be entitled, when, as and if declared, to a minimum preferential quarterly dividend payment of the greater of (a) $1.00 per share, and (b) an amount equal to 1,000 times the dividend declared per ordinary share. In the event of liquidation, dissolution or winding up of the Company, the holders of the Preferred Shares will be entitled to a minimum preferential payment of the greater of (a) $10.00 per share (plus any accrued but unpaid dividends), and (b) an amount equal to 1,000 times the payment made per ordinary share. Each Preferred Share will have 1,000 votes, voting together with the ordinary shares. Finally, in the event of any merger, consolidation or other transaction in which issued and outstanding ordinary shares are converted or exchanged, each Preferred Share will be entitled to receive 1,000 times the amount received per ordinary share. These rights are protected by customary anti-dilution provisions.
Because of the nature of the Preferred Shares' dividend, liquidation and voting rights, the value of the one one-thousandth interest in a Preferred Share purchasable upon exercise of each Right should approximate the value of one ordinary share.
In the event that any person or group of affiliated or associated persons becomes an Acquiring Person, each holder of a Right, other than Rights beneficially owned by the Acquiring Person (which will thereupon become void), will thereafter have the right to receive upon exercise of a Right that number of ordinary shares having a market value of two times the exercise price of the Right.
In the event that, after a person or group has become an Acquiring Person, the Company is acquired in a merger or other business combination transaction or 50% or more of its consolidated assets or earning power are sold, proper provisions will be made so that each holder of a Right (other than Rights beneficially owned by an Acquiring Person, which will have become void) will thereafter have the right to receive upon the exercise of a Right that number of ordinary shares of the person with whom the Company has engaged in the foregoing transaction (or its parent) that at the time of such transaction have a market value of two times the exercise price of the Right.
At any time after any person or group becomes an Acquiring Person and prior to the earlier of one of the events described in the previous paragraph or the acquisition by such Acquiring Person of 50% or more of the issued and outstanding ordinary shares, the board of directors of the Company may exchange the Rights (other than Rights owned by such Acquiring Person, which will have become void), in whole or in part, for ordinary shares or Preferred Shares (or a series of the Company's preferred shares having equivalent rights, preferences and privileges), at an exchange ratio of one ordinary share, or a fractional Preferred Share (or other preferred shares) equivalent in value thereto, per Right.
With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in the Purchase Price. No fractional Preferred Shares
or ordinary shares will be issued (other than fractions of Preferred Shares which are integral multiples of one one-thousandth of a Preferred Share, which may, at the election of the Company, be evidenced by depositary receipts), and in lieu thereof an adjustment in cash will be made based on the current market price of the Preferred Shares or the ordinary shares.
At any time prior to the time an Acquiring Person becomes such, the board of directors may redeem the Rights in whole, but not in part, at a price of $.01 per Right or such other price as the board of directors shall determine at the time of putting the Rights Plan in effect (the "Redemption Price"), payable, at the option of the Company, in cash, ordinary shares or such other form of consideration as the board of directors shall determine. The redemption of the Rights may be made effective at such time, on such basis and with such conditions as the board of directors in its sole discretion may establish. Immediately upon any redemption of the Rights, the right to exercise the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price.
For so long as the Rights are then redeemable, the Company may, except with respect to the Redemption Price, amend the Rights Agreement in any manner. After the Rights are no longer redeemable, the Company may, except with respect to the Redemption Price, amend the Rights Agreement in any manner that does not adversely affect the interests of holders of the Rights.
Until a Right is exercised or exchanged, the holder thereof, as such, will have no rights as a shareholder of the Company, including, without limitation, the right to vote or to receive dividends.
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE SHELF RIGHTS PLAN RESOLUTION.
Mr. Winningham as chairman of the board of directors and helps to ensure the effective independent functioning of the board of directors in its oversight responsibilities. As the lead independent director, Mr. Young coordinates the activities of the other independent directors, including coordinating with the chairman to determine an appropriate schedule of board of directors and committee meetings, working with the chairman to schedule any special update meetings he may determine would benefit the board of directors, working with the chairman to jointly set and agree upon the agenda for meetings of the board of directors, coordinating with the chairman on the quality, quantity and timeliness of information submitted by management to
counsel and reviewing with management and the independent auditors the adequacy and effectiveness of the Company'sCompany’s internal controls over financial reporting and the effectiveness of the Company'sCompany’s disclosure controls and procedures. It also discusses the scope and results of the audit with our independent registered public accounting firm, reviews with our management and our independent registered public accounting firm our interim and year-end operating results and, as appropriate, initiates inquiries into aspects of our financial affairs. Our audit committee is responsible for establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters, and for the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters. In addition, our audit committee has sole and direct responsibility for the appointment, retention, compensation and oversight of the work of our independent registered public accounting firm, including approving services and fee arrangements. Significant related party transactions will be approved by our audit committee before we enter into them, as required by applicable rules and listing standards.
three meetings and acted once by written consent.
Nominating/Corporate Governance Committee
Our
In addition, the Our nominating/corporate governance committee believes diversity of experience can come from personal characteristics such as race and gender as well as diversity in background, viewpoints and skills. Our nominating/corporate governance committee and our board of directors (which includes our Chief Executive Officer) has usedis committed to actively seeking highly qualified women and mayindividuals from underrepresented groups to include in the future usepool from which new candidates are selected.
lives and works in, Ireland. Furthermore, our board members range in age from 56 to 88. Our board of directors also seeks members that have extensive leadership experience, but may seek other members with different backgrounds, based upon the contributions they can make to our company. Currently, our directors all have significant leadership experience and collectively bring expertise and experience in finance, research and development, healthcare, corporate strategy, public company governance, regulatory, drug development and commercialization of pharmaceutical products.
.
directors’ membership criteria set forth in our Corporate Governance Guidelines; and (iv) any other information that such shareholder believes is relevant in considering the director candidate. The shareholder is also advised to provide evidence of the recommending person'sperson’s ownership of our shares and the shareholder'sshareholder’s name and address.
Equity Compensation
| Name | | | Fees Earned or Paid in Cash ($)(1) | | | Share Awards ($)(2)(3) | | | Option Awards ($)(2)(4) | | | Total ($) | | ||||||||||||
| (a) | | | (b) | | | (c) | | | (d) | | | (h) | | ||||||||||||
| Eran Broshy | | | | | 89,500.00 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 373,098.00 | | |
| Robert V. Gunderson, Jr. | | | | | 65,500.00 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 349,098.00 | | |
| Burton G. Malkiel, Ph.D. | | | | | 107,500.00 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 391,098.00 | | |
| Dean J. Mitchell | | | | | 85,500.00 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 369,098.00 | | |
| Susan Molineaux, Ph.D. | | | | | 78,500.00 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 362,098.00 | | |
| Donal O’Connor | | | | | 85,500.00 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 369,098.00 | | |
| Deepika R. Pakianathan, Ph.D. | | | | | 46,500.00 | | | | | | 166,664 | | | | | | 164,361 | | | | | | 377,525.00 | | |
Peter S. Ringrose, Ph.D.(5) | | | | | 25,750.00 | | | | | | 0 | | | | | | 0 | | | | | | 25,750.00 | | |
| Laurie Smaldone Alsup, M.D. | | | | | 82,230.77 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 365,828.77 | | |
| George M. Whitesides, Ph.D. | | | | | 68,500.00 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 352,098.00 | | |
| William D. Young | | | | | 113,500.00 | | | | | | 199,979 | | | | | | 83,619 | | | | | | 397,098.00 | | |
Name | Fees Earned or Paid in Cash ($)(1) | Share Awards ($)(2)(3)(4) | Total ($) | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| (a) | (b) | (c) | (h) | |||||||
Eran Broshy | 75,750 | 218,040 | 293,790 | |||||||
Henrietta H. Fore | 78,750 | 218,040 | 296,790 | |||||||
Robert V. Gunderson, Jr. | 66,750 | 218,040 | 284,790 | |||||||
Burton G. Malkiel, Ph.D. | 99,750 | 218,040 | 317,790 | |||||||
Dean J. Mitchell | 72,750 | 218,040 | 290,790 | |||||||
Susan Molineaux, Ph.D. | 63,750 | 218,040 | 281,790 | |||||||
Donal O'Connor | 75,750 | (5) | 218,040 | 288,790 | ||||||
Peter S. Ringrose, Ph.D. | 80,750 | 218,040 | 298,790 | |||||||
George M. Whitesides, Ph.D. | 70,750 | 218,040 | 288,790 | |||||||
William D. Young | 111,750 | 218,040 | 329,790 | |||||||
(1)
(1)- Includes the annual retainers paid to each director for service in
2017,2020, as well as fees for attendance at board of director and committee meetings in2017.2020.
their immediate family, persons with whom they share a household, persons that are their economic dependents and any other individuals or entities whose transactions in securities they influence, direct or control are prohibited from engaging in transactions in publicly traded options on our securities, such as puts, calls and other derivative securities, on an exchange or in any other organized market. Although our Insider Trading Policy requires that all such individuals receive permission from one of our senior legal officers before entering into any hedging or monetization transactions, we have not and do not intend to in the future approve any such transactions. The full text of our insider trading policy is posted on the Investor Relations portion of our website at www.theravance.com.
| Name | | | Age | | | Position(s) | |
Rick E Winningham | | | | | Chief Executive Officer and Chairman of the Board | | |
| | | | | President, Theravance Biopharma Ireland Limited | | |
| Richard A. Graham | | | 47 | | | Senior Vice President, Development | |
| Brett K. Haumann | | | 51 | | | Senior Vice President, Chief Medical Officer | |
| Andrew A. Hindman | | | 48 | | | Senior Vice President and Chief Financial Officer | |
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Frank Pasqualone | | | | | Senior Vice President and Chief Commercial Operations Officer | | |
Kenneth R. Pitzer | | | | | Senior Vice President, Product Strategy and Commercial Planning | | |
Vijay Sabesan | | | 48 | | | Senior Vice President, Technical Operations | |
| Bradford J. Shafer | | | | | Executive Vice President, General Counsel and Secretary | | |
| | | | | Senior Vice President, | ||
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In March 2021, Dr. Haumann informed us that he was resigning from Theravance Biopharma effective April 5, 2021 for reasons unrelated to the company.
University of Houston and obtained his B.Pharm/M.Pharm degree in Pharmacy/Pharmacology from the University of Bombay.
California, Berkeley, Haas School of Business.
Philip D. Worboys, Ph.D., has served as our Senior Vice President, Research and Translational Science since March 2016, where is he responsible for leading the progression of drug candidates from the discovery stage into human clinical studies, including clinical pharmacology and biomarker development as well as project management. Previously, Dr. Worboys was Vice President, Drug Metabolism and Pharmacokinetics (DMPK) since he joined Theravance Biopharma in October 2014 from Innoviva, where he held the position of Vice President, DMPK since November 2008. Prior to joining Innoviva, he served as Senior Director, DMPK at Roche Bioscience, Inc. since 2005. Dr. Worboys was an Associate Director, DMPK at Pharmacia Corporation from 2001 until its acquisition by Pfizer, Inc. and was Senior Director, DMPK at Pfizer, Inc. from 2003 to 2005. He spent the first part of his career in DMPK, at Merck Sharp & Dohme in Harlow, United Kingdom, and worked in various capacities at Aventis, Unilever and GlaxoSmithKline prior to that. Dr. Worboys obtained his Ph.D. degree in Pharmaceutics from Manchester University, United Kingdom. He holds a B.Sc. degree in Biochemistry from Imperial College of Science, Technology & Medicine at the University of London.
They must value collaboration, communication, transparency, and be committed to our mission of creating medicines that improve the lives of patients living with serious disease. In short, our executive team must be highly skilled to deliver on our priorities. We believe we have assembled a team with this important balance of expertise and qualities and that they work together for all stakeholders, including the patients we are working to serve, our investors and our employees. Executives with the skills, qualities and experience the members of our executive team possess are highly valued and highly sought after, making enduring retention of our executive team a key priority of our compensation committee and board that is reflected in our compensation philosophy and programs.
Achievementnebulized doses and low systemic levels of Corporate Goals. At the beginning of 2017, we set out to achieve eight corporate goals (described belowTD-0903 in the "Annual Cash Incentive Compensation" section), of which the compensation committee determined that we accomplished or partially accomplished six out of eight goals for 2017.
Lower CEO and Named Executive Officer Compensation. Despite the above accomplishments, the total direct compensation as reported in the Summary Compensation Table of this proxy statement (consisting of base salary, annual incentive bonus and the grant date fair value of equity incentive awards) paid to our CEO in 2017 was approximately 60% lower than the total direct compensation paid to him in 2016. Additionally, the total direct compensation as reported in the Summary Compensation Table paid to all of our named executive officers, other than Dr. Suliman who was newly hired in 2017, was below the median of both the peer group used for 2017 compensation decisions and the new peer group that was determined in 2017 for 2018 compensation decisions. The lower total direct compensation reported in the Summary Compensation Table for our named executive officers is
systemic circulation, consistent with the special longlung-selective design. Data from Phase 1 provided confidence to continue dosing patients in a Phase 2 study.
key development programs.
and commercialization goals and we work to ensure that officers have meaningful share-holdings, including unvested shares and shares that vest over multiple years.
team’s performance and set a tone of high achievement.
In December 2017, our compensation committee adopted
responsibility, the compensation committee reviews the performance of each named executive officer at least once each year, and generally twice per year. The CEO, as the manager of the executive team, assesses the executives'executives’ contributions to the corporate goals and makes a recommendation to the compensation committee with respect to any merit increase in salary, cash bonus and annual replenishment equity award for each member of the executive team, other than himself. The compensation committee meets with the CEO to evaluate, discuss and modify or approve these recommendations. The compensation committee also conducts a similar evaluation of the CEO'sCEO’s contributions when the CEO is not present, and determines any increase in salary, cash bonus and annual replenishment equity award for him.
Peer Group
The compensation committee typically revisits the peer group every two years. In December 2017, FW Cook revised the peer group (the "2017 Peer Group") that was used to evaluate 2018 compensation decisions. The 2017 Peer Group criteria focused onhighlighting companies with market capitalization between 0.25-5.0 times that of Theravance Biopharma at the time the peers were chosen (which0.4x and 4x our market capitalization. This resulted in a targeted range for market capitalization of $500 million$0.5 billion to $10.5$4.8 billion in light of the Company's $2.1our $1.2 billion market capitalization at the time), with the goal of positioning Theravance Biopharma near the median of thetime. An additional peer group. In selecting peer companies,company, Bluebird Bio, was also included despite its larger market capitalization was considered the primary criterionof $8.4 billion, because we view it as it drives equity compensation usagea comparable company to ours and reported grant values.a direct competitor for talent. The 2017 Peer Group consistsresulting peer group consisting of the following twenty-one companies:
| | |||||
| Peer Group | |||||
|---|---|---|---|---|---|
| | Agios | | Heron Therapeutics | | |
| Amarin | | | ImmunoGen | | |
| | Arena Pharmaceuticals | | | Ironwood | |
| Bluebird Bio | |||||
| | Portola Pharmaceuticals | | |||
| Corcept Therapeutics | | | Prothena | | |
| | CytomX Therapeutics | | | PTC Therapeutics | |
| | Eagle Pharmaceuticals | | | Radius Health | |
| | FibroGen | | Retrophin | | |
| | Five Prime Therapeutics | | Ultragenyx Pharmaceutical | | |
| Global Blood Therapeutics | | Zogenix | | ||
| Halozyme Therapeutics | | | | | |
*New for 2017 Peer Group
We operate in an intensely competitive labor market in which talented employees typically have many alternatives and it is relatively easy to change jobs. Accordingly, when making recommendationsIn order to our compensation committeeensure we remain competitive in the market to hire and in making compensation decisions,retain employees, our CEO and compensation committee review data about the compensation of similar officers at the peer group companies with awhen making compensation-related decisions. The company’s view is that to be competitive, compensation levels should generally be at least at the median of the peer data. While we believe this data, provides useful insight into the competitiveness of our compensation
packages, the compensation data provides onlywhich are used as a reference point and we do not currently target anywithout targeting a particular benchmark. FactorsCompensation decisions are informed by factors specific to our company and the individual named executive officers primarily inform our compensation decisions.officers. For example, we believe that our portfolio of research and development programs, which currently includes multiple compounds in clinical development a product under review for approval by the FDAtreatment of multiple disease states, and our marketing of an approved product with our partner Viatris (formerly Mylan), is generally broader than those of companies in our peer group, which affects therequires a broader range of skills and experiences needed byexpertise from our executive officers and in turn affects our compensation decisions to attract and retain them.
| Name | | | Increase in Annual Base Salary | | |||
| Rick E Winningham | | | | | 3.0% | | |
| Andrew A. Hindman | | | | | 2.4% | | |
| Brett K. Haumann | | | | | 2.0% | | |
| Vijay Sabesan | | | | | 3.5% | | |
| Bradford J. Shafer | | | | | 3.5% | | |
start date in mid-2019.
time, as well as individual performance.
| Category | | | 2020 Corporate Goals, As Revised in June 2020 | | | Original Weighting | | | Weighting | | | Achievement (out of possible 200%) | | |||||||||
| COMMERCIAL | | | • YUPELRI® (Revefenacin) Inhalation Solution: Achieve net sales target established by the Board | | | | | 35% | | | | | | 35% | | | | | | 89% | | |
| DEVELOPMENT | | | • Successful execution and progression of the pivotal Phase 3 Studies of Ampreloxetine | | | | | 40% | | | | | | 35% | | | | | | 114% | | |
| | | | • Successful execution and progression of clinical studies of TD-1473 | | | | | | | | | | | | | | | | | | | |
| | | | • Successful execution and progression of NINJA phase 2a program | | | | | | | | | | | | | | | | | | | |
| | | | • Creation, execution and progression of the new COVID-19 development program | | | | | | | | | | | | | | | | | | | |
| RESEARCH AND TRANSLATIONAL SCIENCE | | | • Nominate one Development Candidate | | | | | 15% | | | | | | 15% | | | | | | 113% | | |
| | | | • Initiate one new program | | | | | | | | | | | | | | | | | | | |
| CORPORATE | | | • Achieve year-end cash balance of ~2 years projected burn | | | | | 10% | | | | | | 15% | | | | | | 113% | | |
| | | | • Complete 1-2 Corporate/Business Development transaction(s), based on business needs | | | | | | | | | | | | | | | | | | | |
| | | | • Demonstrate organization resilience amongst COVID-19 pandemic (employee retention, engagement, self-care) | | | | | | | | | | | | | | | | | | | |
| | | | Total: | | | | | 100% | | | | | | 100% | | | | | | 105% | | |
The. While we did not meet our aggressive internal sales goals, comprising our cash bonus program for 2017 are listedthe compensation committee was pleased that YUPELRI achieved profitability on a brand-basis in the table below (assecond half of 2020 and achieved year-over-year sales growth of 159%; its share of the nebulized COPD market increased to 18.6% through November 2020.
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(1)Goal partially achieved, as described in further detail below.
As the table above indicates, for purposes of the 2017 cash bonus program, our compensation committee determined that we accomplished four outthe cash bonus pool would be set at 105% of eight annualtarget, it exercised discretion to reduce the bonus payouts for our executives below that level. The compensation committee determined that it would reduce the bonus payouts for executives generally to a 95% of target payout level, which it felt reflected their responsibility for our performance goalsagainst objectives for 2017. Ourthe year, although it exercised further discretion to reduce Dr. Haumann’s bonus to reflect a mid-year reorganization of his team. The compensation committee also determined that we partially achieved two additional performance goals. As a result, the compensation committee determinedbonuses for Messrs. Hindman and Sabesan would not be reduced fully down to fund the cash bonus pool at 100%95% of target for non-executive officer employees and 90% for executive officers.
The following goals were achieved by the Company during 2017:
•Goal 1: Report positive data from Phase 1b ulcerative colitis program with TD-1473. In August 2017, the Company announced positive data from the first cohort of patientsdue to Mr. Hindman’s role in thePhase 1b study of TD-1473. While the Company continuessuccessful financing activities in 2020 and Mr. Sabesan’s role in ensuring sufficient drug product for us toprogress the study according to the protocol, the compensation committee noted that the data from the first study cohort provided the Company with confidence to begin planning to progress TD-1473unexpectedly accelerate TD-0903 intoa larger Phase2/3study of ulcerative colitis, which the Company intends to initiate in 2018. The Company also plans to initiate a Phase 2 study of TD-1473 in Crohn's disease in 2018.•Goal 3: File new drug application (NDA)clinical trials forrevefenacin in Chronic Obstructive Pulmonary Disease (COPD). In November 2017, the Company submitted a NDA for revefenacin with the Food and Drug Administration (FDA). The NDA is supportedAcute Lung Injury (ALI) caused bydata from the two replicate Phase 3 efficacy studies and twelve-month safety study. In January 2018, the FDA accepted the NDA for review and assigned a Prescription Drug User Fee Act (PDUFA) target action date of November 13, 2018.COVID-19.
•Goal 7: Nominate at least one development candidate. In early 2017, we nominated one new drug development candidate from our research programs. These research programs are focused in the areas of inflammation and immunology, with the goal of designing medicines that provide local activity restricted to targeted tissues and without systemic exposure, in order to maximize patient benefit and minimize risk. In addition, we nominated a second development candidate in early 2018, with the work primarily completed in 2017.
portion of the study strengthened the program and did not detract from achievement of the goal of reporting positive data from this study.
While certain goals were not fully achieved by the Company during 2017, the compensation committee considered the following factors, including partial achievement and the progress made towards achievement:
•Goal 6: Report positive data from the velusetrag Phase 2b Diabetic and Idiopathic Gastroparesis Efficacy, Safety and Tolerability (DIGEST) Study. In August 2017, we announced positive top line results for the 5 mg dose of velusetrag in the DIGEST study. However, since planning for the velusetrag development program is ongoing, the compensation committee believes that the ultimate determination regarding the achievement of positive results from the DIGEST study will be dependent on the results of dialogue with regulatory agencies.•Goal 8: Execute at least one corporate/business development transaction (based on business needs). In early February 2018, the Company executed a License and Collaboration Agreement with Janssen Biotech, Inc., one of the Janssen Pharmaceutical Companies of Johnson & Johnson ("Janssen"), in order to establish a collaboration for the development and commercialization of TD-1473 and related back-up compounds for inflammatory intestinal diseases, including ulcerative colitis and Crohn's disease. Although the agreement was not signed until 2018, the compensation committee believes that the significant effort, planning, discussions, diligence, negotiation and coordination in 2017 by a wide variety of employees that culminated in the execution of the agreement in early 2018 should be recognized and rewarded.
With respect to the two corporate goals for which the compensation committee determined no partial achievement should be recognized for the purposes of 2017 bonuses, the committee made the following observations:
•Goal 2: Initiate Phase 2 trial in accelerated pathway to approval with TD-1473. The compensation committee noted management's thoughtful strategic decision to focus the Company's attention on the negotiation and execution of the agreement with Janssen, in order to focus resources and ensure alignment of the planned additional studies of TD-1473 with the development and commercial insights of our partner.•Goal 4: Demonstrate progress in advancing our acute care franchise (including accelerated enrollment in our bacteremia trial). The compensation committee noted with appreciation the Company's focus on strategies to optimize operational effectiveness in its acute care commercial organization and the contributions of the patient registry study, or TOUR™, in providing information about the use of VIBATIV in real-world clinical settings. The compensation committee also recognized the diligent work done by the Company's acute care organization to prepare for the potential launch of revefenacin-with our partner Mylan. However, the compensation committee ultimately determined that VIBATIV sales in 2017 and the continued pace of enrollment in our bacteremia trial were not sufficient to warrant achievement of this goal.
The actual bonuses awarded to our named executive officers are shown in the table below and reflected in the Bonus and Non-Equity Incentive Compensation columnscolumn of the "Summary“Summary Compensation Table"Table” on page 47:
| Name | | | Title | | | Cash Bonus ($) | | | Percentage of Target (%) | | ||||||
| Rick E Winningham | | | Chief Executive Officer | | | | | 579,646 | | | | | | 95 | | |
| Andrew A. Hindman | | | Senior Vice President and Chief Financial Officer | | | | | 265,000 | | | | | | 96 | | |
| Brett K. Haumann | | | Senior Vice President, Chief Medical Officer | | | | | 213,320(1) | | | | | | 70 | | |
| Vijay Sabesan | | | Senior Vice President, Technical Operations | | | | | 200,000 | | | | | | 98 | | |
| Bradford J. Shafer | | | Executive Vice President, General Counsel and Secretary | | | | | 265,000 | | | | | | 95 | | |
Name | Title | Cash Bonus ($) | Percentage of Target (%) | ||||||
|---|---|---|---|---|---|---|---|---|---|
Rick E Winningham | Chief Executive Officer | 504,991 | 90 | ||||||
Renee D. Gala | Senior Vice President and Chief Financial Officer, Treasurer | 200,051 | 90 | ||||||
Frank Pasqualone | Senior Vice President and Global Head, Acute Care Business | 113,934 | 45 | ||||||
Bradford J. Shafer | Executive Vice President, General Counsel and Secretary | 225,889 | 90 | ||||||
Shehnaaz Suliman | Senior Vice President, Corporate Development and Strategy | 237,500 | 100 | ||||||
In
1.365.
officers.
although the replenishment RSUs awarded to our named executive officers in 2016 vest over a five-year period. The Company believesWe believe that the resulting overlapping vesting schedule from awards made in prior years, together with the number of shares subject to each award, helps ensure a meaningful incentive to remain in the Company'sour employ and to enhance shareholder value over time. Annual replenishment equity award grants to all
The replenishment In determining the size of equity awards granted to our named executive officers, our compensation committee considers such matters as it deems appropriate in early 2017 were partits discretion, including individual and company performance and recommendations from our CEO. The compensation committee also references guidelines that provide the compensation committee with information about the size of equity awards, both as a percentage of the company and based on grant value, at our peer companies.
2017 Annual Replenishment RSUs
2017 was the second year of the Long-Term Retention and Performance Incentive Program. In connection withWhile the Long-Term Retention and Performance Incentive Program did not impact the guidelineannual replenishment equity award for 2016, 2017awards that were granted to our named executive officers in 2020, the Five-Year Performance RSAs remained outstanding and 2018 for each participant inwere eligible to vest through 2020, as further discussed below. In addition, while Mr. Hindman was not employed by us when the Long-Term Retention and Performance Incentive Program was multiplied by three ("3-year award") to determine the number of sharesimplemented and therefore is not a participant in that might normally be provided over that three year period. Each named executive officer participatingprogram, in the Long-Term Retention and Performance Incentive Programconnection with his hire in 2019 he was granted two-thirds60,000 performance-contingent RSUs with a goal of his respective 3-year award ascreating a similar performance incentive.
3% above the median for all of our named executive officers combined.
| Name and Title | | | 2020 RSUs | | |||
Rick E Winningham Chief Executive Officer | | | | | 170,000 | | |
Andrew A. Hindman Senior Vice President and Chief Financial Officer | | | | | 43,550 | | |
Brett K. Haumann Senior Vice President and Chief Medical Officer | | | | | 65,000 | | |
Vijay Sabesan Senior Vice President, Technical Operations | | | | | 65,000 | | |
Bradford J. Shafer Executive Vice President, General Counsel and Secretary | | | | | 65,000 | | |
much lower than 2016 total direct compensation (approximately 60% lower for our CEO), and was below the median of both the Company's 2015 Peer Group and 2017 Peer Group.
Name and Title* | 2017 RSUs | 2018 RSUs | |||||
|---|---|---|---|---|---|---|---|
Rick E Winningham | 28,000 | 28,000 | |||||
Renee D. Gala | 9,000 | 9,000 | |||||
Frank Pasqualone | 9,000 | 9,000 | |||||
Bradford J. Shafer | 9,000 | 9,000 | |||||
*Does not include Dr. Suliman as she is not a participant in the Long-Term Retention and Performance Incentive Program
Five-Year Performance RSAs
Prior to 2020, four milestones — for Phase 3 Success, the first successful completion of a business development transaction, First Proof of Concept (LUNAR program) (meaning completion of a Phase 2a study that shows efficacy and tolerability of a compound in the Company’s LUNAR program such that it would be reasonable to progress the compound to the next stage of development) and NDA approval — were achieved, which triggered the first and second vesting events for the Five-Year Performance RSAs and resulting in vesting of 60% of the shares subject to the awards.
milestone; provided, however, Dr. Suliman remainsthe applicable milestone. Achievement is required by June 30, 2022 and Mr. Hindman must remain employed with us through suchthe applicable vesting date. The remaining performance milestonesmilestone applicable to Dr. Suliman'sMr. Hindman’s performance-contingent RSU areRSUs is as follows:
| Performance Milestone | | | | |
| | ||||
- (1)
"Recurring Annual Corporate Revenue"
Performance-Contingent Cash Awards. In February 2018,2020, the compensation committee determined that one performancecertified achievement of an additional milestone (#2 in(as noted above with respect to the table above)Five-Year Performance RSAs for the firstsecond successful completion of a BD transaction was achieved, as it relatedtransaction), resulting in the final payment to the Company's entry into the License and Collaboration Agreement with Janssen. As a result, fifty percentMr. Sabesan pursuant to his Performance-Contingent Cash Award of Dr. Suliman's performance-contingent RSUs vested$560,000 becoming due to him on February 20, 2018.
2021 (subject to his continued employment through such date).
appropriate and necessary benefit to offer to suchThis provides former Innoviva employees in order to provide a level of benefits that is at least equal to those they were eligible for prior to our spin-off in 2014.
spin-off.
bonus.
The Company does
Dean J. Mitchell
George M. Whitesides, Ph.D.
William D. Young, Chairman
(1)- The material in this report is not
"soliciting“soliciting material,"” is not deemed"filed"“filed” with the SEC and is not to be incorporated by reference in any filing of Theravance Biopharma under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
| Name and Principal Position | | | Year | | | Salary ($)(1) | | | Bonus ($) | | | Share Awards ($)(2) | | | Option Awards ($)(2) | | | Non-Equity Incentive Plan Compensation ($)(3) | | | All Other Compensation ($) | | | Total ($) | | ||||||||||||||||||||||||
| Rick E Winningham | | | | | 2020 | | | | | | 1,014,455 | | | | | | — | | | | | | 4,977,600 | | | | | | — | | | | | | 579,646 | | | | | | 6,045(4) | | | | | | 6,577,746 | | |
| Chief Executive Officer | | | | | 2019 | | | | | | 983,710 | | | | | | — | | | | | | 4,469,300 | | | | | | — | | | | | | 473,906 | | | | | | 5,496 | | | | | | 5,932,411 | | |
| | | | | | 2018 | | | | | | 956,600 | | | | | | 74,767 | | | | | | 796,320 | | | | | | — | | | | | | 690,154 | | | | | | 5,000 | | | | | | 2,522,841 | | |
Andrew A. Hindman(5) | | | | | 2020 | | | | | | 551,608 | | | | | | — | | | | | | 1,275,144 | | | | | | — | | | | | | 265,278 | | | | | | 5,920 | | | | | | 2,097,950 | | |
| Senior Vice President and | | | | | 2019 | | | | | | 315,000 | | | | | | 175,000 | | | | | | 847,000 | | | | | | 2,204,956 | | | | | | 216,000 | | | | | | — | | | | | | 3,757,956 | | |
| Chief Financial Officer | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Brett Haumann(6) | | | | | 2020 | | | | | | 572,569 | | | | | | — | | | | | | 1,903,200 | | | | | | — | | | | | | 213,589 | | | | | | 53,267(7) | | | | | | 2,742,625 | | |
| Senior Vice President, | | | | | 2019 | | | | | | 543,047 | | | | | | — | | | | | | 1,708,850 | | | | | | — | | | | | | 170,000 | | | | | | 42,382 | | | | | | 2,464,280 | | |
| Clinical Development and | | | | | 2018 | | | | | | 497,810 | | | | | | 34,125 | | | | | | 255,960 | | | | | | — | | | | | | 315,000 | | | | | | 414,300 | | | | | | 1,517,194 | | |
| Chief Medical Officer | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Vijay Sabesan | | | | | 2020 | | | | | | 407,677 | | | | | | — | | | | | | 1,903,200 | | | | | | — | | | | | | 760,326 | | | | | | 6,541(8) | | | | | | 3,077,744 | | |
| Senior Vice President, | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Technical Operations | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Bradford J. Shafer | | | | | 2020 | | | | | | 556,321 | | | | | | — | | | | | | 1,903,200 | | | | | | — | | | | | | 264,999 | | | | | | 6,045(9) | | | | | | 2,730,565 | | |
| Executive Vice President, | | | | | 2019 | | | | | | 537,403 | | | | | | — | | | | | | 1,708,850 | | | | | | — | | | | | | 215,611 | | | | | | 6,983 | | | | | | 2,468,848 | | |
| General Counsel and | | | | | 2018 | | | | | | 518,080 | | | | | | 33,770 | | | | | | 255,960 | | | | | | — | | | | | | 311,726 | | | | | | 5,000 | | | | | | 1,124,537 | | |
| Secretary | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Name and Principal Position | Year | Salary ($)(1) | Bonus ($)(2) | Share Awards ($)(3) | Option Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | All Other Compensation ($)(5) | Total ($) | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Rick E Winningham | 2017 | 932,534 | 201,997 | 874,720 | — | 302,995 | 5,000 | 2,317,245 | |||||||||||||||||
Chief Executive Officer | 2016 | 903,545 | 189,744 | 4,748,800 | — | 433,702 | 5,000 | 6,280,791 | |||||||||||||||||
| 2015 | 902,069 | — | 4,325,000 | — | 271,064 | 814 | 5,498,947 | ||||||||||||||||||
Renee D. Gala | 2017 | 443,305 | 80,020 | 281,160 | — | 120,031 | 5,000 | 929,516 | |||||||||||||||||
SVP and Chief Financial | 2016 | 429,525 | 75,167 | 1,526,400 | — | 171,810 | 5,000 | 2,207,902 | |||||||||||||||||
Officer, Treasurer | 2015 | 428,315 | — | 2,335,500 | — | 161,072 | 814 | 2,925,701 | |||||||||||||||||
Frank Pasqualone | 2017 | 505,145 | 45,574 | 281,160 | — | 68,360 | 6,020 | (6) | 906,259 | ||||||||||||||||
Senior Vice President and | 2016 | 491,625 | 12,291 | 1,526,400 | — | 196,650 | 5,053 | 2,232,019 | |||||||||||||||||
Global Head, Acute Care | 2015 | 490,240 | — | 2,249,000 | — | 184,359 | 719 | 2,924,318 | |||||||||||||||||
Business | |||||||||||||||||||||||||
Bradford J. Shafer | 2017 | 500,561 | 90,356 | 281,160 | — | 135,533 | 5,000 | 1,012,609 | |||||||||||||||||
Executive Vice President, | 2016 | 478,413 | 87,510 | 1,950,400 | — | 191,365 | 5,000 | 2,712,688 | |||||||||||||||||
General Counsel and Secretary | 2015 | 441,031 | — | 2,076,000 | — | 165,854 | 814 | 2,683,698 | |||||||||||||||||
Shehnaaz Suliman(7) | 2017 | 201,515 | 245,000 | (8) | 638,600 | 2,844,865 | 142,500 | 2,981 | 4,075,461 | ||||||||||||||||
Senior Vice President, Corporate Development and Strategy | |||||||||||||||||||||||||
(1)
(1)- Includes amounts deferred pursuant to our 401(k) plan.
(8)Also includes a signing bonus of $150,000 thatBeginning in April 2020, Dr. Haumann’s compensation was paid in GBP and has been converted toDr. SulimanUSD using the OANDA average monthly exchange rate in the month paid.
| | | | | | | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1) | | | All Other Stock Awards: Number of Shares or Units (#)(2)(3) | | | Grant Date Fair Value of Stock Awards ($) | | |||||||||||||||
| Name | | | Grant Date | | | Target ($) | | | Maximum ($) | | ||||||||||||||||||
| Rick E Winningham | | | N/A | | | | | 610,154 | | | | | | 1,220,307 | | | | | | — | | | | | | — | | |
| | | | 2/3/2020 | | | | | — | | | | | | — | | | | | | 170,000 | | | | | | 4,977,600 | | |
| Andrew A. Hindman | | | N/A | | | | | 276,332 | | | | | | 552,663 | | | | | | — | | | | | | — | | |
| | | | 2/3/2020 | | | | | — | | | | | | — | | | | | | 43,550 | | | | | | 1,275,144 | | |
| Brett Haumann | | | N/A | | | | | 305,127 | | | | | | 610,254 | | | | | | — | | | | | | — | | |
| | | | 2/3/2020 | | | | | — | | | | | | — | | | | | | 65,000 | | | | | | 1,903,200 | | |
| Vijay Sabesan | | | N/A | | | | | 204,415 | | | | | | 557,893 | | | | | | — | | | | | | — | | |
| | | | 2/3/2020 | | | | | — | | | | | | — | | | | | | 65,000 | | | | | | 1,903,200 | | |
| Bradford J. Shafer | | | N/A | | | | | 278,947 | | | | | | 408,829 | | | | | | — | | | | | | — | | |
| | | | 2/3/2020 | | | | | — | | | | | | — | | | | | | 65,000 | | | | | | 1,903,200 | | |
| | | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1) | Estimated Possible Payouts Under Equity Incentive Plan Awards | | | | | |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | All Other Option Awards: Number of Securities Underlying Options (#) | | | | |||||||||||||||||||||||
| | | All Other Stock Awards: Number of Shares or Units (#)(2) | | | ||||||||||||||||||||||||
| | | Exercise or Base Price of Option Awards ($/sh) | Grant Date Fair Value of Stock Awards ($) | |||||||||||||||||||||||||
Name | Grant Date | Target ($) | Maximum ($) | Threshold (#) | Target (#) | |||||||||||||||||||||||
Rick E Winningham | N/A | 561,101 | 841,652 | — | — | — | — | — | — | |||||||||||||||||||
| 2/6/2017 | — | — | — | — | — | 28,000 | (3) | — | 874,720 | |||||||||||||||||||
Renee D. Gala | N/A | 222,279 | 333,419 | — | — | — | — | — | — | |||||||||||||||||||
| 2/6/2017 | — | — | — | — | — | 9,000 | (3) | — | 281,160 | |||||||||||||||||||
Frank Pasqualone | N/A | 253,187 | 379,781 | — | — | — | — | — | — | |||||||||||||||||||
| 2/6/2017 | — | — | — | — | — | 9,000 | (3) | — | 281,160 | |||||||||||||||||||
Bradford J. Shafer | N/A | 250,988 | 376,481 | — | — | — | — | — | — | |||||||||||||||||||
| 2/6/2017 | — | — | — | — | — | 9,000 | (3) | — | 281,160 | |||||||||||||||||||
Shehnaaz Suliman | N/A | 237,500 | 356,250 | — | — | — | — | — | — | |||||||||||||||||||
| 8/1/2017 | — | — | — | — | 170,000 | (4) | — | 31.93 | 2,844,865 | |||||||||||||||||||
| 8/1/2017 | — | — | — | — | — | 20,000 | (5) | — | 638,600 | |||||||||||||||||||
| 8/1/2017 | — | — | 25,000 | (6) | 50,000 | (6) | — | — | — | — | (7) | |||||||||||||||||
(1)
(1)- Each named executive officer was granted a
non-equitynon equity incentive plan award pursuant to our20172020 annual cash bonus plan which is discussed in greater detail in the"Annual“Annual Cash IncentiveCompensation"Compensation” section of the"Compensation“Compensation Discussion andAnalysis"Analysis” beginning on page39.32. The amounts shown in the"target"“target” column reflect the target payout under the plan. The target amount is equal to 50% of each named executiveofficers'officers’ base salaries, with the exception of Mr. Winningham, whose target bonus amount was 60% of his base salary. The amounts shown in the"maximum"“maximum” column reflect the maximum payout under the planif allequal to 200% ofthe goals were achieved. No "threshold" is applicable to these awards.each officer’s target bonus The actual amounts paid to each named executive officer are shown in the Summary Compensation Table on page47.45.
applicable to these awards, as full vesting of the performance-contingent RSUs will be achieved at the "target" payout in the table above.
(7)At the time the performance-contingent RSUs were granted to Dr. Suliman, it was not probable that any of the performance milestones relative to such award would be achieved. The grant date fair value of the award assuming that both milestones are achieved (the highest level attainable for purposes of full vesting of the RSUs) is set forth in footnote 3 to the Summary Compensation Table on page 47.
2020.
50.
employee is subject to an involuntary termination in connection with or following our change in control.
| | | | | | | | | | Option Awards | | | Stock Awards | | ||||||||||||||||||||||||||||||||||||||||||
| Name | | | Security | | | Number of Securities Underlying Unexercised Options Exercisable (#) | | | Number of Securities Underlying Unexercised Options Unexercisable (#) | | | Option Exercise Price ($) | | | Option Expiration Date | | | Number of Shares or Units of Stock That Have Not Vested (#) | | | Market Value of Shares or Units That Have Not Vested ($)(1) | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested (#) | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(2) | | |||||||||||||||||||||||||||
| (a) | | | | | | | | | (b) | | | (c) | | | (e) | | | (f) | | | (g) | | | (h) | | | (i) | | | (j) | | ||||||||||||||||||||||||
| Rick E Winningham | | | | | TBPH | | | | | | 80,000(3) | | | | | | — | | | | | | 23.51 | | | | | | 6/02/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | 320,000(4) | | | | | | — | | | | | | 28.35 | | | | | | 8/21/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 14,000(5) | | | | | | 248,780 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 168,000(6) | | | | | | 2,985,360 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,750(7) | | | | | | 31,098 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,750(8) | | | | | | 155,488 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 95,625(9) | | | | | | 1,699,256 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 170,000(10) | | | | | | 3,020,900 | | | | | | — | | | | | | — | | |
| Andrew A. Hindman | | | | | TBPH | | | | | | 92,083(11) | | | | | | 167,917(11) | | | | | | 16.94 | | | | | | 6/30/2029 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 37,500(12) | | | | | | 666,375 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 20,000(13) | | | | | | 355,400 | | | | | | 20,000(13) | | | | | | 355,400 | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 43,550(10) | | | | | | 773,884 | | | | | | — | | | | | | — | | |
| Brett Haumann | | | | | INVA | | | | | | 94,823(14) | | | | | | — | | | | | | 29.95 | | | | | | 12/01/2023 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | 59,375(3) | | | | | | — | | | | | | 23.51 | | | | | | 6/02/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 4,500(5) | | | | | | 79,965 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 54,000(6) | | | | | | 959,580 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 562(7) | | | | | | 9,987 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,812(8) | | | | | | 49,969 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 36,562(9) | | | | | | 649,707 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 65,000(10) | | | | | | 1,155,050 | | | | | | — | | | | | | — | | |
| Vijay Sabesan | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 937(7) | | | | | | 16,650 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 312(15) | | | | | | 5,544 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 11,719(8) | | | | | | 208,374 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 21,094(9) | | | | | | 374,840 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 15,469(16) | | | | | | 274,884 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 65,000(10) | | | | | | 1,155,050 | | | | | | — | | | | | | — | | |
| Bradford J. Shafer | | | | | TBPH | | | | | | 170,000(17) | | | | | | — | | | | | | 28.75 | | | | | | 9/07/2024 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 4,500(5) | | | | | | 79,965 | | | | | | — | | | | | | — | | |
| | | | | | TBPH | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 54,000(6) | | | | | | 959,580 | | | | | | — | | | | | | — | | |
| | | Option Awards | Stock Awards | ||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Security | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units That Have Not Vested ($)(1) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(2) | ||||||||||||||||||
| (a) | | (b) | (c) | (e) | (f) | (g) | (h) | (i) | (j) | ||||||||||||||||||
Rick E Winningham | TBPH | 76,667 | (3) | 3,333 | (3) | 23.51 | 6/02/2024 | — | — | — | — | ||||||||||||||||
| TBPH | 266,667 | (4) | 53,333 | (4) | 28.35 | 8/21/2024 | — | — | — | — | |||||||||||||||||
| TBPH | — | — | — | — | 78,125 | (5) | 2,178,906 | — | — | ||||||||||||||||||
| TBPH | — | — | — | — | 182,000 | (6) | 5,075,980 | 105,000 | (7) | 2,928,450 | |||||||||||||||||
| TBPH | — | — | — | — | 28,000 | (8) | 780,920 | — | — | ||||||||||||||||||
Renee D. Gala | TBPH | 81,458 | (3) | 3,542 | (3) | 23.51 | 6/02/2024 | — | — | — | — | ||||||||||||||||
| TBPH | 72,604 | (9) | 12,396 | (9) | 32.13 | 7/20/2024 | — | — | — | — | |||||||||||||||||
| TBPH | — | — | — | — | 37,500 | (5) | 1,045,875 | — | — | ||||||||||||||||||
| TBPH | — | — | — | — | 4,687 | (10) | 130,720 | ||||||||||||||||||||
| TBPH | — | — | — | — | 58,500 | (6) | 1,631,565 | 33,750 | (7) | 941,288 | |||||||||||||||||
| TBPH | — | — | — | — | 9,000 | (8) | 251,010 | — | — | ||||||||||||||||||
Frank Pasqualone | INVA | 181,745 | (11) | 7,902 | (11) | 30.25 | 1/22/2024 | ||||||||||||||||||||
| TBPH | 95,833 | (3) | 4,167 | (3) | 23.51 | 6/02/2024 | |||||||||||||||||||||
| INVA | — | — | — | — | 10,000 | (12) | 141,900 | ||||||||||||||||||||
| TBPH | — | — | — | — | 2,857 | (12) | 79,682 | ||||||||||||||||||||
| TBPH | — | — | — | — | 40,625 | (5) | 1,133,031 | — | — | ||||||||||||||||||
| TBPH | — | — | — | — | 58,500 | (6) | 1,631,565 | 33,750 | (7) | 941,288 | |||||||||||||||||
| TBPH | — | — | — | — | 9,000 | (8) | 251,010 | — | — | ||||||||||||||||||
Bradford J. Shafer | TBPH | 138,125 | (13) | 31,875 | (11) | 28.75 | 9/07/2024 | — | — | — | — | ||||||||||||||||
| TBPH | — | — | — | — | 37,500 | (5) | 1,045,875 | — | — | ||||||||||||||||||
| TBPH | — | — | — | — | 14,062 | (14) | 392,189 | — | — | ||||||||||||||||||
| TBPH | — | — | — | — | 58,500 | (6) | 1,631,565 | 33,750 | (7) | 941,288 | |||||||||||||||||
| TBPH | — | — | — | — | 9,000 | (8) | 251,010 | — | — | ||||||||||||||||||
Shehnaaz Suliman | TBPH | — | 170,000 | (15) | $ | 31.93 | 7/31/2027 | ||||||||||||||||||||
| TBPH | — | — | — | — | 20,000 | (16) | 557,800 | 25,000 | (17) | 697,250 | |||||||||||||||||
Option Awards Stock Awards Name Security Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#) Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#) Option
Exercise
Price
($) Option
Expiration
Date Number of
Shares
or Units
of Stock
That Have
Not Vested
(#) Market
Value of
Shares or
Units That
Have Not
Vested
($)(1) �� Equity
Incentive
Plan Awards:
Number of
Unearned
Shares,
Units
or Other
Rights that
Have Not
Vested
(#) Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
($)(2) (a) (b) (c) (e) (f) (g) (h) (i) (j) TBPH — — — — 562(7) 9,987 — — TBPH — — — — 2,812(8) 49,969 — — TBPH — — — — 36,562(9) 649,707 — — TBPH — — — — 65,000(10) 1,155,050 — — (1)Computed in accordance with SEC rules as the number of unvested RSUs or RSAs, as applicable, multiplied by the closing market price of our ordinary sharesor Innoviva's common stock, as applicable,at the end ofthe respective company's 2017our 2020 fiscal year, which was$27.89 for us and $14.19 for Innoviva.$17.77. The actual value (if any) to be realized by the officer depends on whether the shares vest and the future performance of our ordinary shares.(2)(2)Computed in accordance with SEC rules as the number of unvested RSUs or RSAs multiplied by the closing market price of our ordinary shares at the end of the20172020 fiscal year, which was$27.89.$17.77. The actual value (if any) to be realized by the officer depends on whether the performance milestones related thereto are achieved, whether theshares vestaward vests following achievement of the performance milestones, and the future performance of our ordinary shares.(3)(3)Messrs.Mr. Winningham andPasqualone and Ms. GalaDr. Haumann were each granted options under our 2013 Equity Incentive Plan on June 3, 2014 in connection with their commencement of employment with us.Twenty-five percent25% of the shares subject to the option vested on February 20, 2015 and the remaining sharesvestvested monthly thereafter over the course of the next three years, subject to theofficer'sofficer’s continuous service through each vesting date.(4)(4)Mr. Winningham was granted an option under our 2013 Equity Incentive Plan on August 22, 2014 in connection with commencing full-time employment with us.Twenty-five percent25% of the shares subject to the option vested on August 15, 2015 and the remaining sharesvestvested monthly thereafter over the course of the next three years, subject to Mr.Winningham'sWinningham’s continuous service through each vesting date.(5)(5)Messrs. WinninghamPasqualoneand Shafer andMs. Gala were each granted an annual replenishment equity award of RSUs under our 2013 Equity Incentive Plan on February 5, 2015. Twenty-five percent of the RSUs vested on February 20, 2016 and the remaining 75% of the RSUs vest in equal quarterly installments over the following three years, subject to the officer's continuous service through each vesting date.(6)Messrs. Winningham, Pasqualone and Shafer and Ms. GalaDr. Haumann were each granted an annual replenishment equity award grant of RSUs under our 2013 Equity Incentive Plan on March 15, 2016.Twenty percent20% of the RSUs vested on February 20, 2017 and the remaining 80% of the RSUs vest in equal quarterly installments over the following four years, subject to theofficer'sofficer’s continuous service through each vesting date.
(6)(7)Messrs. WinninghamPasqualoneand Shaferand Ms. Galaeach received performance contingent RSAs and Dr. Haumann received performance-contingentRSAsRSUs under our 2013 Equity Incentive Plan on March 15, 2016, which we refer to as"Five-Year“Five-Year Performance RSAs."” The vesting of these RSAsis(or, in the case of Dr. Haumann, RSUs) was contingent upon the achievement of performance milestones by December 31, 2020 as well as continued employment, as described in detail in the"2016“2016 Five-Year PerformanceRSAs"RSAs” section of the"Compensation“Compensation Discussion andAnalysis"Analysis” beginning on page4132 of our Proxy Statement for the 2017 Annual General Meeting of Shareholders filed on April 11, 2017. Inaccordance with SEC rules, the2020, a sufficient number ofshares in column (i)milestones adding up to twenty points was achieved and thevalue of thoseremaining shares subject to the awards became eligible to vest on February 20, 2021 (subject to the officer’s continued employment through such date), which are reflected incolumn (j) reflects threshold performance assuming milestones that add up to ten points are achieved.columns (g) and (h).(7)(8)Messrs. Winningham,PasqualoneSabesan and Shafer andMs. GalaDr. Haumann were each granted an annual replenishment equity award of RSUs under our 2013 Equity Incentive Plan on February 6, 2017.Twenty-five percent25% of the RSUs vested on February 20, 2018 and the remaining 75% vest in equal quarterly installments over the following three years, subject to theofficer'sofficer’s continuous service through each vesting date.48(9)Ms. Gala was
| | | Option Awards | Stock Awards | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Security | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2) | ||||||||||
| (a) | | (b) | (c) | (d) | (e) | ||||||||||
Rick E Winningham | TBPH | — | — | 160,892 | 5,182,231 | ||||||||||
| INVA | — | — | 1,374 | 18,260 | |||||||||||
Renee D. Gala | TBPH | — | — | 65,678 | 2,108,248 | ||||||||||
| INVA | — | — | 1,974 | 25,642 | |||||||||||
Frank Pasqualone | TBPH | — | — | 65,428 | 2,102,467 | ||||||||||
| INVA | — | — | 5,000 | 66,450 | |||||||||||
Bradford J. Shafer | TBPH | — | — | 72,616 | 2,337,282 | ||||||||||
| INVA | — | — | 624 | 8,293 | |||||||||||
Shehnaaz Suliman | TBPH | — | — | — | — | ||||||||||
Stock Awards Name Security Number of
Shares
Acquired on
Vesting (#) Value
Realized on
Vesting
($)(1) (a) (d) (e) Rick E Winningham TBPH 291,375 7,107,863 Andrew A. Hindman TBPH 32,500 745,750 Brett Haumann TBPH 98,188 2,391,944 Vijay Sabesan TBPH 43,468 1,006,398 Bradford J. Shafer TBPH 99,750 2,432,400 (1)Value realized is based on the fair market value of our ordinary shares on date of exercise minus the exercise price (or, in the case of Innoviva options, the fair market value of Innoviva's common stock on the date of exercise minus the exercise price) and does not necessarily reflect proceeds actually received by the officer.(2)Value realized is based on the fair market value of our ordinary shares on the vesting date(or, in the case of vesting of Innoviva RSAs held by one of our named executive officers, based on the fair market value of Innoviva's common stock)multiplied by the number of shares vested and does not necessarily reflect proceeds received by the officer.With respect to vesting of Innoviva RSAs, the value also includes cash dividends previously declared with respect to such RSAs, which were also released to the holder upon vesting of the RSA.Each of our named executive officers is entitled to severance benefits pursuant to our severance plan. In addition, Mr. Winningham is entitled to severance benefits pursuant to his letter agreement entered into in connection with his appointment as Chief Executive Officer.Change in Control Severance BenefitsPursuant to our severance plan, if a named executive officer is subject to an involuntary termination within 3 months prior to or 24 months after our change in control, the officer is entitled to the following benefits provided he or she signs a releasea releaseof claims:•In the case of our Senior Vice Presidents and Executive Vice President, a lump sum payment equal to 150% of theofficer'sofficer’s annual base salary and target bonus.••In the case of our Chief Executive Officer, a lump sum payment equal to 200% of theofficer'sofficer’s annual base salary and target bonus.••- A pro-rata portion of the named executive
officer'sofficer’s target bonus based on the number of full months of employment completed in the year of termination.••Continuation of theofficer'sofficer’s health and welfare benefits for the shorter of 18 months or the expiration of theofficer'sofficer’s continuation coverage under COBRA.••Full vesting of any unvested options or other equity awards held by the officer; provided, however, that therestricted ordinary shares subject to performance-based vesting that were granted to our named executive officers on March 15, 2016 (the "Five-Year Performance RSAs") as well as theperformance-based RSUs granted toDr. Suliman in August 2017Mr. Hindman on July 1, 2019 (the"Suliman PRSUs"“Hindman PRSUs”) for which the performance milestones have not been achieved as of the change in control (the"Remaining Shares"“Remaining RSUs”) are subject to forfeiture at the time of the change in control as follows: (i) if the per share value to be received by a holder of our ordinary shares in such change in control (the"CIC Value"“CIC Value”) is less than or equal to$16.96 per share or, in the case of Dr. Suliman, $31.93$16.94 per share, as adjusted for share splits and similar events (such amount,in either case,the"Base Value"“Base Value”), all RemainingSharesRSUs will be forfeited; (ii) if the CIC Value is greater than the Base Value but less than two times the Base Value, then a percentage ofeach named executive officer'sMr. Hindman’s RemainingSharesRSUs equal to the percentage by which the CIC Value is greater than the Base Value (rounded down to the nearest whole percent) may be retained bythe named executive officerMr. Hindman and the balance of the RemainingSharesRSUs will be forfeited; and (iii) if the CIC Value is equal to or greater than two times the Base Value, none of the RemainingSharesRSUs will be forfeited. All unforfeited RemainingSharesRSUs following such change in control will be subject to the following vesting schedule and will remain eligible for vesting acceleration in accordance with our Change in Control and Severance Plan: Fifty percent of the unforfeited RemainingSharesRSUs will vest on the one-year anniversary of the change in control and the remaining 50% of the unforfeited RemainingSharesRSUs will vest on the two-year anniversary of the change in control, subject tothe named executive officer'sMr. Hindman’s continuous service through the applicable vesting date.
50
"Misconduct"
•- Value of Restricted Ordinary Shares and Restricted Share Unit Acceleration: The value of the vesting acceleration of the restricted ordinary shares and unvested RSUs was calculated by multiplying the number of unvested shares or RSUs by the closing price of our ordinary shares on December
29, 201731, 2020 (which was$27.89$17.77 per share).For unvested shares of Innoviva's common stock, the value of the vesting acceleration of the shares of Innoviva common stock was calculated by multiplying the number of such unvested shares by the closing price of Innoviva's common stock on December 29, 2017 (which was $14.19 per share).
| Name | | | Bonus for Year of Termination ($)(1) | | | Cash Severance ($)(2) | | | Vacation Payout ($) | | | Options that Vest ($)(3) | | | Restricted Shares or RSUs that Vest ($)(4) | | | Health and Welfare ($)(5) | | | Cash-Based Awards that Vest(6) | | | Total ($) | | ||||||||||||||||||||||||
| (a) | | | (b) | | | (c) | | | (d) | | | (e) | | | (f) | | | (g) | | | (h) | | | (i) | | ||||||||||||||||||||||||
Rick E Winningham(7) | | | | | 610,154 | | | | | | 3,254,154 | | | | | | 97,777 | | | | | | — | | | | | | 8,140,881 | | | | | | 84,803 | | | | | | | | | | | | 12,187,769 | | |
| Andrew A. Hindman | | | | | 276,332 | | | | | | 1,243,492 | | | | | | 39,854 | | | | | | 139,371 | | | | | | 1,809,875 | | | | | | 51,355 | | | | | | | | | | | | 3,560,278 | | |
| Brett K. Haumann | | | | | 305,127 | | | | | | 1,373,072 | | | | | | 29,158 | | | | | | — | | | | | | 2,904,258 | | | | | | 0 | | | | | | | | | | | | 4,611,615 | | |
| Vijay Sabesan | | | | | 204,415 | | | | | | 919,865 | | | | | | 39,309 | | | | | | — | | | | | | 2,035,216 | | | | | | 84,803 | | | | | | 560,000 | | | | | | 3,283,608 | | |
| Bradford J. Shafer | | | | | 278,947 | | | | | | 1,255,259 | | | | | | 53,642 | | | | | | — | | | | | | 2,904,258 | | | | | | 84,803 | | | | | | | | | | | | 4,576,908 | | |
Name | Bonus for Year of Termination ($)(1) | Cash Severance ($)(2) | Vacation Payout ($) | Options that Vest ($)(3) | Restricted Shares or RSUs that Vest ($)(4) | Health and Welfare ($)(5) | Total ($) | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (a) | (b) | (c) | (d) | (e) | (f) | (g) | (i) | |||||||||||||||
Rick E Winningham(6) | 561,101 | 2,992,541 | 89,916 | 14,599 | 15,532,638 | 59,900 | 19,250,694 | |||||||||||||||
Renee D. Gala | 222,279 | 1,000,256 | 41,891 | 15,514 | 5,468,866 | 59,900 | 6,808,706 | |||||||||||||||
Frank Pasqualone | 253,187 | 1,139,342 | 48,688 | 18,251 | 5,646,884 | 36,233 | 7,142,585 | |||||||||||||||
Bradford J. Shafer | 250,988 | 1,129,444 | 34,482 | — | 5,730,335 | 59,900 | 7,205,148 | |||||||||||||||
Shehnaaz Suliman | 237,500 | 1,068,750 | 11,626 | — | 557,800 | 40,671 | 1,916,347 | |||||||||||||||
- (1)
- 2020:
$6,577,746.
Form) of our U.S. employees as of December 31, 20172020 for the period from January 1, 20172020 through December 31, 2017. Non-U.S.2020 and an amount equivalent to the Form W-2, Box 5 for the Irish employees wereconsisting of the total amount of earnings paid to each employee, including regular earnings such as salary and bonuses, and benefits that would be taxable in the U.S. Our UK employee was excluded as they constituted less than 5% of our workforce. As of December 31, 2017,2020, we had 340331 employees, including nine27 employees in Ireland and one in the United Kingdom. No cost-of-livingcost of living or other adjustments were made in determining our median employee.Median Employee. Once we identified our "medianmedian employee," using the methodology described above, we determined that employee'semployee’s annual total compensation in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K for purposes of calculating the required pay ratio.
| | | | Beneficial Ownership | | |||||||||
Name and Address of Beneficial Owner(1) | | | Number of Ordinary Shares | | | Percent of Total Outstanding Ordinary Shares(2) | | ||||||
| 5% Shareholders | | | | | | | | | | | | | |
GlaxoSmithKline plc(3) | | | | | 9,644,807 | | | | | | 14.8% | | |
980 Great West Road Brentford, Middlesex TW8 9GS, United Kingdom | | | | | | | | | | | | | |
FMR LLC(4) | | | | | 9,607,310 | | | | | | 14.7% | | |
245 Summer Street Boston, MA 02210 | | | | | | | | | | | | | |
The Baupost Group, L.L.C.(5) | | | | | 9,605,996 | | | | | | 14.7% | | |
10 St. James Ave, Suite 1700 Boston, MA 02116 | | | | | | | | | | | | | |
OrbiMed Capital LLC(6) | | | | | 6,219,110 | | | | | | 9.5% | | |
601 Lexington Avenue, 54th Floor New York, NY 10022 | | | | | | | | | | | | | |
Wellington Management Group LLP(7) | | | | | 5,609,627 | | | | | | 8.6% | | |
c/o Wellington Management Company LLP 280 Congress Street Boston, MA 02210 | | | | | | | | | | | | | |
Vanguard Group, Inc.(8) | | | | | 4,654,309 | | | | | | 7.1% | | |
100 Vanguard Blvd. Malvern, PA 19355 | | | | | | | | | | | | | |
BlackRock, Inc.(9) | | | | | 4,491,195 | | | | | | 6.9% | | |
55 East 52nd Street New York, NY 10055 | | | | | | | | | | | | | |
| | Beneficial Ownership | ||||||
|---|---|---|---|---|---|---|---|
Name and Address of Beneficial Owner(1) | Number of Shares | Percent of Total Outstanding Ordinary Shares(2) | |||||
5% Shareholders | |||||||
Woodford Investment Management Limited(3) | 10,747,108 | 19.6 | % | ||||
9400 Garsington Road | |||||||
The Baupost Group, L.L.C.(4) | 10,179,996 | 18.6 | % | ||||
10 St. James Ave, Suite 1700 | |||||||
GlaxoSmithKline plc(5) | 9,644,807 | 17.6 | % | ||||
980 Great West Road | |||||||
FMR LLC(6) | 8,139,620 | 14.9 | % | ||||
245 Summer Street | |||||||
BlackRock, Inc.(7) | 3,743,955 | 6.8 | % | ||||
55 East 52nd Street | |||||||
Vanguard Group, Inc.(8). | 3,398,332 | 6.2 | % | ||||
100 Vanguard Blvd. | |||||||
| | Beneficial Ownership | ||||||
|---|---|---|---|---|---|---|---|
Name and Address of Beneficial Owner(1) | Number of Shares | Percent of Total Outstanding Ordinary Shares(2) | |||||
Named Executive Officers and Directors | |||||||
Rick E Winningham(9) | 1,395,205 | 2.5 | % | ||||
Renee D. Gala(10) | 407,595 | * | |||||
Frank Pasqualone(11) | 344,369 | * | |||||
Bradford J. Shafer(12) | 309,244 | * | |||||
Shehnaaz Suliman | 16,230 | * | |||||
Eran Broshy(13) | 42,000 | * | |||||
Robert V. Gunderson, Jr.(14) | 69,906 | * | |||||
Burton G. Malkiel, Ph.D.(15) | 86,571 | * | |||||
Dean Mitchell(16) | 42,000 | * | |||||
Susan M. Molineaux, Ph.D.(17) | 30,000 | * | |||||
Donal O'Connor(18) | 27,000 | * | |||||
Peter S. Ringrose, Ph.D.(19) | 45,428 | * | |||||
Laurie Smaldone Alsup(20) | 4,276 | * | |||||
George M. Whitesides, Ph.D.(21) | 261,054 | * | |||||
William D. Young(22) | 59,124 | * | |||||
All executive officers and directors as a group (19 persons)(23) | 3,845,309 | 6.9 | % | ||||
Beneficial Ownership Name and Address of Beneficial Owner(1) Number of Ordinary
Shares Percent of Total
Outstanding Ordinary
Shares(2) Named Executive Officers and Directors Rick E Winningham(10) 1,437,888 2.2% Andrew A. Hindman(11) 143,292 * Brett Haumann(12) 218,374 * Vijay Sabesan 94,076 * Bradford J. Shafer(13) 306,547 * Eran Broshy(14) 83,206 * Robert V. Gunderson, Jr.(15) 111,112 * Burton G. Malkiel, Ph.D.(16) 128,777 * Dean Mitchell(17) 83,206 * Susan M. Molineaux, Ph.D.(18) 71,206 * Donal O’Connor(19) 64,206 * Deepika R. Pakianathan, Ph.D.(20) 17,567 * Laurie Smaldone Alsup(21) 56,482 * George M. Whitesides, Ph.D.(22) 281,248 * William D. Young(23) 100,330 * All executive officers and directors as a group (20 persons)(24) 4,117,940 6.2% *Less than one percent.(1)(1)Unless otherwise indicated, the address for each beneficial owner is c/o Theravance Biopharma US, Inc., 901 Gateway Boulevard, South San Francisco, California 94080.(2)(2)Beneficial ownership as reported in the table has been determined in accordance with SEC rules and regulations and includesshares ofour ordinary shares that may be issued upon the exercise of options that are exercisable within 60 days of March5, 20181, 2021 and RSUs subject to release within 60 days of March5, 2018.1, 2021. Pursuant to SEC rules and regulations, all shares not currently outstanding that are subject tostockoptions exercisable within 60 days of March5, 20181, 2021 and RSUs subject to release within 60 days of March5, 20181, 2021 are deemed to be outstanding for the purpose of computing"Percent“Percent ofClass"Class” held by the holder of the class but are not deemed to be outstanding for the purpose of computing the"Percent“Percent ofClass"Class” held by any other shareholder.(3)(3)Based on the Amendment No.4 to Schedule 13G filed with the SEC on February 13, 2018 by Woodford Investment Management Ltd. ("WIM") and Neil Woodford, Head of Investment for WIM and the Amendment No. 3 to Schedule 13G filed with the SEC on February 13, 2018 by CF Woodford Equity Income Fund, 40 Dukes Place, London, EC3A 7NH, United Kingdom (the "Woodford Fund"). The Woodford Fund holds shared voting and dispositive power of 8,114,946 shares. WIM is the Manager of the Woodford Fund, and has investment discretion and voting power over securities held of record by the Woodford Fund. WIM may be deemed to be the beneficial owner of the ordinary shares of Theravance Biopharma beneficially owned by the Woodford Fund. The Woodford Fund may also be deemed to be beneficial owners of such ordinary shares of Theravance Biopharma because, pursuant to the Management Agreement between the Woodford Fund and WIM, the Woodford Fund may give WIM disposition and voting instructions for the Woodford Fund's securities and because the Management Agreement may be terminated at any time upon 60 days' or less notice. WIM and Mr. Woodford each hold shared voting and dispositive power of 10,747,108 shares. WIM is an investment manager, authorized and regulated by the Financial Conduct Authority, in the business of investment management. Mr. Woodford, as a controlling person of WIM, may be deemed to have beneficial ownership under Section 13 of the Securities Exchange Act, of the securities beneficially owned by WIM.Securities beneficially owned by WIM were purchased on behalf of its clients. Mr. Woodford expressly disclaims beneficial ownership of the ordinary shares beneficially owned by WIM, except to the extent of any pecuniary interest therein.(4)Based on the Amendment No. 3 to Schedule 13G filed with the SEC on February 13, 2018 jointly by The Baupost Group, L.L.C. ("Baupost"), Baupost Group GP, L.L.C. and Seth A. Klarman. Baupost, Baupost Group GP, L.L.C. and Mr. Klarman each hold shared voting and shared dispositive power of 10,179,996 shares. Baupost Group is a registered investment adviser and acts as an investment adviser and general partner to various private investment limited partnerships. Securities reported as being beneficially owned by Baupost were purchased on behalf of certain of such partnerships. Baupost Group GP, L.L.C., as the Manager of Baupost, and Mr. Klarman, as the sole owner and managing member of Baupost Group GP, L.L.C. a controlling person of Baupost, may be deemed to have beneficial ownership under Section 13 of the Securities Exchange Act of 1934, as amended, of the securities beneficially owned by Baupost.(5)Based on the Amendment No. 27 to Schedule 13D filed with the SEC onFebruary 3, 2017June 22, 2020 by GlaxoSmithKline plc. Shares are held of record byGlaxo Group Limited,GSK Finance (No.3) plc (“GSK Finance”), an indirect wholly owned subsidiary of GlaxoSmithKline plc, an English public limited company. GlaxoSmithKline plc holds sole voting and sole dispositive power of 9,644,807 shares. GSK Finance issued $280,336,000 of Exchangeable Senior Notes due 2023 (“the Notes”), initially exchangeable into 9,644,792 Ordinary Shares. The Notes are guaranteed by GSK and will be exchangeable at the option of noteholders on any business day on or after September 1, 2020.
(4)(6)Based on the Amendment No.25 to Schedule 13G filed with the SEC on February13, 20188, 2021 by FMR LLC("(“FMRLLC"LLC”) and Abigail P. Johnson, Director,theChairman andtheChief Executive Officer of FMR LLC. FMR LLC has sole voting power of693,551shares1,731,912 shares and sole dispositive power of8,139,6209,607,310 shares. Ms. Johnson has sole dispositive power of8,139,6209,607,310 shares.FIAM LLC, Fidelity Institutional Asset Management Trust Company,Fidelity Management & Research CompanyInc. ("LLC, a wholly owned subsidiary of FMRCo."LLC (“FMR Co”)and Strategic Advisers, Inc.beneficially owns the ordinary shares held by FMR LLC. FMR Co. beneficially owns 5% or greater of our ordinary shares. Members of the Johnson family, including Ms. Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into ashareholders'shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority55
(8)- Based on the Amendment No. 1 to Schedule 13G filed with the SEC on February
8, 20183, 2021 byVanguardWellington Management GroupInc. ("Vanguard"). VanguardLLP, Wellington Group Holdings LLP, Wellington Investment Advisors Holdings LLP, Wellington Management Company LLP. Wellington Management Group LLP, Wellington Group Holdings LLP, and Wellington Investment Advisors Holdings LLP each hassole voting power of 80,952 shares,shared voting power of2,711 shares, sole dispositive power of 3,317,4425,304,990 shares and shared dispositive power of80,8905,609,627 shares. Wellington Management Company LLP has shared voting power of 5,253,112 shares and shared dispositive power of 5,386,597 shares. The securities as to which the Schedule was filed by Wellington Management Group LLP, as parent holding company of certain holding companies and the Wellington Investment Advisers, are owned of record by clients of the following entities (collectively, “Wellington Investment Advisers”): Wellington Management Company LLP; Wellington Management Canada LLC; Wellington Management Singapore Pte Ltd; Wellington Management Hong Kong Ltd; Wellington Management International Ltd; Wellington Management Japan Pte Ltd; and Wellington Management Australia Pty Ltd. Wellington Investment Advisors Holdings LLP controls directly, or indirectly through Wellington Management Global Holdings, Ltd., the Wellington Investment Advisers. Wellington Investment Advisors Holdings LLP is owned by Wellington Group Holdings LLP. Wellington Group Holdings LLP is owned by Wellington Management Group LLP.
(23)- All. Includes an aggregate of (i)
1,047,7291,251,125 shares subject to options exercisable within 60 days of March5, 2018;1, 2021, and (ii)2,856 of our ordinary shares distributed in the spin-off with respect to Innoviva restricted shares that remain subject to vesting; (iii) 55,77667,782 RSUs subject to release within 60 days of March5, 2018; and (iv) 1,230,000 Five-Year Performance RSAs with respect to which the holders have sole voting power but no dispositive power.
| Plan Category | | | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | | | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights ($) | | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans | | |||||||||
| Equity compensation plans approved by shareholders | | | | | 8,076,337(1) | | | | | | 25.09(3) | | | | | | 6,707,056(4)(5) | | |
| Equity compensation plans not approved by shareholders | | | | | 216,760(2) | | | | | | 17.27 | | | | | | 203,261 | | |
| Total | | | | | 8,293,097 | | | | | | 24.58 | | | | | | 6,910,317 | | |
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights ($) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
Equity compensation plans approved by shareholders | 4,850,701 | (1) | $ | 28.64 | (3) | 3,613,634(4 | )(5) | |||
Equity compensation plans not approved by shareholders | 555,626 | (2) | $ | 18.56 | (3) | 79,214 | ||||
Total | 5,406,327 | $ | 26.40 | 3,692,848 | ||||||
(1)
(1)- Includes
1,952,9433,082,419 shares issuable upon exercise of outstanding options and2,897,7584,993,918 shares issuable upon vesting of outstandingrestricted share units.RSUs.
composition of more than 50% of the members of our board of directors as of the date of the agreement and (iii) the effective time of a change in control of the Company.
the foregoing persons, and any firm, corporation or other entity in which any of the foregoing persons is employed, is a general partner or in which such person has a 5% or greater beneficial ownership interest. As set forth in our policies and procedures, it is our general policy to approve or ratify related person transactions only when the board of directors or a committee of the board of directors determines that the transaction is in, or is not inconsistent with, our and our shareholders'shareholders’ best interests, including situations where we may obtain products or services of a nature, quantity or quality, or on other terms, that are not readily available from alternative sources or when the transaction is on terms comparable to those that could be obtained in arm'sarm’s length dealings with an unrelated third party.
accounting principles generally accepted in the United States and the effectiveness of our internal control over financial reporting. It is not the duty of the audit committee to plan or conduct audits, to determine that our financial statements are complete and accurate and are in accordance with generally accepted accounting principles, or to assess or determine the effectiveness of our internal control over financial reporting.
Eran Broshy
Donal
Deepika R. Pakianathan, Ph.D.
March 22, 2021
Directors: 2021 Annual General Meeting RESOLUTION OF SHAREHOLDERSOFTHERAVANCE BIOPHARMA, INC. WHEREAS, in order to preserve, for the shareholders of Theravance Biopharma, Inc., a Cayman Islands exempted company (the "Company"), the long-term value of the Company, the Board of Directors of the Company (the "Board") has recommended that the shareholders of the Company approve the shareholder rights plan (the "Rights Plan") set forth in the form of rights agreement provided asExhibit A to this resolution (as the same may be amended from time to time, the "Rights Agreement") and authorize the Board to put the Rights Plan into effect in the future if and when the Board deems appropriate and in the best interests of the Company; and WHEREAS, the shareholders of the Company wish to approve the Rights Plan and authorize the Board to put the Rights Plan into effect in the future if and when the Board deems appropriate and in the best interests of the Company; NOW THEREFORE BE IT: RESOLVED, that the Rights Plan is hereby approved, and the Board is hereby authorized to adopt and put the Rights Plan into effect in the future if and when the Board deems appropriate and in the best interests of the Company; RESOLVED, without limiting the foregoing authority, the Board shall have the authority in connection with putting the Rights Plan into effect to determine: (i) the applicable record date, the initial exercise price of the Rights (as such term is defined in the Rights Agreement), the redemption price therefor, and, if the Company has not redeemed or exchanged them prior to such time, the date after which the Rights shall no longer be exercisable, (ii) the person or entity designated as rights agent under the Rights Agreement, and (iii) the form, terms and provisions of the Rights Agreement, which shall be substantially in the form presented to the shareholders with such modifications therein as shall be approved by the Board. RESOLVED, in addition to the specific authorizations set forth in any of the foregoing resolutions, the Board is hereby authorized to take or cause to be taken any and all such further actions as they shall in their judgment determine to be necessary, desirable or advisable to carry out fully the intent and purposes of the foregoing resolutions.THERAVANCE BIOPHARMA, INC.and[Computershare Trust Company, N.A.],as Rights AgentRIGHTS AGREEMENTDated as of [ ] [ ], 20[ ]PageSection 1.Certain Definitions1Section 2.Appointment of Rights Agent5Section 3.Issue of Right Certificates6Section 4.Form of Right Certificates7Section 5.Countersignature and Registration8Section 6.Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates8Section 7.Exercise of Rights, Purchase Price; Expiration Date of Rights9Section 8.Cancellation and Destruction of Right Certificates11Section 9.Availability of Preferred Shares11Section 10.Preferred Share Record Date12Section 11.Adjustment of Purchase Price, Number and Kind of Shares and Number of Rights12Section 12.Certificate of Adjusted Purchase Price or Number of Shares18Section 13.Consolidation, Merger or Sale or Transfer of Assets or Earning Power18Section 14.Fractional Rights and Fractional Shares21Section 15.Rights of Action22Section 16.Agreement of Right Holders23Section 17.Right Certificate Holder Not Deemed![[MISSING IMAGE: tm212357d1-pc_proxy14c.jpg]](https://files.docoh.com/DEF 14A/0001104659-21-039784/tm212357d1-pc_proxy14c.jpg)
Shareholder23Section 18.Concerning the Rights Agent23Section 19.Merger or Consolidation or Change of Name of Rights Agent24Section 20.Duties of Rights Agent25Section 21.Change of Rights Agent27Section 22.Issuance of New Right Certificates28Section 23.Redemption28Section 24.Exchange29Section 25.Notice of Certain Events30Section 26.Notices30Section 27.Supplements and Amendments31Section 28.Successors; Assignment32Section 29.Benefits of this Agreement32Section 30.Determinations and Actions by the Board of Directors32Section 31.Severability32Section 32.Governing Law; Waiver of Jury Trial32Section 33.Counterparts33Section 34.Descriptive Headings33Section 35.Force Majeure33EXH-A-i This Rights Agreement, dated as of[ ] [ ], 20[ ]black ink (as amended, supplemented, restated, extended or renewed from time to time, this "Agreement"), is between Theravance Biopharma, Inc., a Cayman Islands exempted company (the "Company"), and [Computershare Trust Company, N.A., a federally chartered trust company],pen, mark your votes with an X as Rights Agent (the "Rights Agent"). The Board of Directors of the Company (the "Board") has authorized and granted one preferred share purchase right (a "Right") for each Ordinary Share (as hereinafter defined) of the Company issued and outstanding as of the Close of Business (as defined below) on[ ] [ ], 20[ ] (the "Record Date"), each Right representing the right to purchase one one-thousandth (subject to adjustment pursuant to Section 11(n)) of a Preferred Share (as hereinafter defined), upon the terms and subject to the conditions herein set forth, and has further authorized and directed the issuance of one Right (subject to adjustment as provided herein) with respect to each Ordinary Share that shall become issued and outstanding between the Record Date and the earlier of the Distribution Date and the Expiration Date (as such terms are hereinafter defined);provided,however, that Rights may be issued with respect to Ordinary Shares that shall become issued and outstanding after the Distribution Date and prior to the Expiration Date in accordance with Section 22. Accordingly, in consideration of the premises and the mutual agreements herein set forth, the parties hereby agree as follows: Section 1. Certain Definitions. For purposes of this Agreement, the following terms have the meaning indicated: (a) "Acquiring Person" shall mean any Person (as such term is hereinafter defined) who or which, together with all Affiliates and Associates of such Person, and together with any Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof), shall be a Beneficial Owner (as such term is hereinafter defined) of 19.9% or more of the Ordinary Shares then issued and outstanding, but shall not include an Exempt Person (as such term is hereinafter defined);provided,however, that (i) if the Board of Directors of the Company determines in good faith that a Person who would otherwise be an "Acquiring Person" became a Beneficial Owner of a number of Ordinary Shares such that the Person would otherwise qualify as an "Acquiring Person" inadvertently (including, without limitation, because (A) such Person was unaware that it beneficially owned a percentage of Ordinary Shares that would otherwise cause such Person to be an "Acquiring Person" or (B) such Person was aware of the extent of its Beneficial Ownership of Ordinary Shares but had no actual knowledge of the consequences of such Beneficial Ownership under this Agreement) and without any intention of changing or influencing control of the Company, and such Person does not, with such Person's Affiliates and Associates, or together with any Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof), become the owner of any additional Ordinary Shares after learning of or having been informed of such Person becoming (save for this clause) an Acquiring Person, then such Person shall not be deemed to be or to have become an "Acquiring Person" for any purposes of this Agreement unless and until such Person shall have failed to divest itself, as soon as practicable (as determined, in good faith, by the Board of Directors of the Company), of Beneficial Ownership of a sufficient number of Ordinary Shares so that such Person would no longer otherwise qualify as an "Acquiring Person"; (ii) if, as of the date hereof or prior to the first public announcement of the adoption of this Agreement, any Person is or becomes a Beneficial Owner of 19.9% or more of the Ordinary Shares issued and outstanding, such Person shall not be deemed to be or to become an "Acquiring Person" unless and until such time as such Person shall, after the first public announcement of the adoption of this Agreement, become a Beneficial Owner of additional Ordinary Shares (other than pursuant to a dividend or distribution paid or made by the Company on the issued and outstanding Ordinary Shares or pursuant to a split or subdivision of the issued and outstanding Ordinary Shares), unless, upon becoming a Beneficial Owner of such additional Ordinary Shares, suchEXH-A-1Person is not then a Beneficial Owner of 19.9% or more of the Ordinary Shares then issued and outstanding; (iii) no Person shall become an "Acquiring Person" as the result of an acquisition of Ordinary Shares by the Company which, by reducing the number of shares issued and outstanding, increases the proportionate number of Ordinary Shares beneficially owned by such Person to 19.9% or more of the Ordinary Shares then issued and outstanding,provided,however, that if a Person shall become a Beneficial Owner of 19.9% or more of the Ordinary Shares then issued and outstanding by reason of such share acquisitions by the Company and shall thereafter become a Beneficial Owner of any additional Ordinary Shares (other than pursuant to a dividend or distribution paid or made by the Company on the issued and outstanding Ordinary Shares or pursuant to a split, subdivision or recapitalization of the issued and outstanding Ordinary Shares), then such Person shall be deemed to be an "Acquiring Person" unless upon becoming a Beneficial Owner of such additional Ordinary Shares such Person does not beneficially own 19.9% or more of the Ordinary Shares then issued and outstanding; (iv) no Person shall become an "Acquiring Person" solely as a result of any unilateral grant of any security by the Company or through the exercise of any options, warrants, rights or similar interests (including restricted shares) granted by the Company to its directors, officers and employees; and (v) no Person shall become an "Acquiring Person" as the result of the acquisition of Beneficial Ownership of the Ordinary Shares from an individual who, on the later of the date hereof or the first public announcement of this Agreement, is a Beneficial Owner of 19.9% or more of the Ordinary Shares then issued and outstanding if such Ordinary Shares are received by such Person upon such individual's death pursuant to such individual's will or pursuant to a charitable trust created by such individual for estate planning purposes. For all purposes of this Agreement, any calculation of the number of Ordinary Shares issued and outstanding at any particular time, including for purposes of determining the particular percentage of such issued and outstanding Ordinary Shares of which any Person is a Beneficial Owner, shall be made in accordance with the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as in effect on the date hereof. As usedshown in this Agreement, a Person shall be deemedexample. Please do not write outside the designated areas. Your vote matters — here’s how to be "Acting in Concert" with another Person if such Person knowingly acts (whether or not pursuant to an express agreement, arrangement or understanding) in concert with such other Person in, or towards a common goal relating to, changing or influencing the control of the Company or in connection with or as a participant in any transaction having that purpose or effect, in parallel with such other Person where at least one additional factor supports a determination by the Board of Directors that such Person intended to act in concert or in parallel with the other Person, which such additional factorsvote! You may include, without limitation, exchanging information, attending meetings, conducting discussions, or making or soliciting invitations to act in concert or in parallel. A Person who or which is Acting in Concert with another Person shall also be deemed to be Acting in Concert with any third party who is also Acting in Concert with such other Person. (b) "Affiliate" and "Associate" shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under the Exchange Act, as in effect on the date hereof. (c) A Person shall be deemed the "Beneficial Owner" of, shall be deemed to have "Beneficial Ownership" of and shall be deemed to "beneficially own" any securities: (i) which such Person or any of such Person's Affiliates or Associates, or any other Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof), is deemed to beneficially own, directly or indirectly, within the meaning of Rule l3d-3 of the General Rules and Regulations under the Exchange Act as in effect on the date hereof; (ii) which such Person or any of such Person's Affiliates or Associates , or any other Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof), has or shares (A) the right to acquire (whether such right is exercisable immediately or only after the passage of time or upon the satisfaction or occurrence of one or more conditions) pursuant to any agreement,EXH-A-2arrangement or understanding (other than customary agreements with and between underwriters and selling group members with respect to a bona fide public offering of securities), or upon the exercise of conversion rights, exchange rights, rights, warrants or options, or otherwise;provided,however, that a Person shall not be deemed a Beneficial Owner of, or to beneficially own, (w) securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person's Affiliates or Associates until such tendered securities are accepted for purchase or exchange, (x) securities which such Person has a right to acquire upon the exercise of Rights at any time prior to the time that any Person becomes an Acquiring Person, (y) securities issuable upon the exercise of Rights from and after the time that any Person becomes an Acquiring Person if such Rights were acquired by such Person or any of such Person's Affiliates or Associates prior to the Distribution Date or pursuant to Section 3(a) or Section 22 hereof ("Original Rights") or pursuant to Section 11(i) or Section 11(n) with respect to an adjustment to Original Rights or (z) securities which such Person or any of such Person's Affiliates or Associates may acquire, does or do acquire or may be deemed to have the right to acquire, pursuant to any merger or other acquisition agreement between the Company and such Person (or one or more of such Person's Affiliates or Associates) if such agreement has been approved by the Board of Directors prior to such Person's becoming an Acquiring Person; or (B) the right or power to vote (directly or indirectly) pursuant to any agreement, arrangement or understanding;provided,further, that a Person shall not be deemed a Beneficial Owner of, or to beneficially own, any security by reason of such agreement, arrangement or understanding if the agreement, arrangement or understanding, whether or not in writing, to vote such security (1) arises solely from a revocable proxy or consent given to such Person in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules and regulations promulgated under the Exchange Act and (2) is not also then reportable on Schedule 13D or Schedule 13G under the Exchange Act (or any comparable or successor report); (iii) which are beneficially owned, directly or indirectly, by any other Person and with respect to which such Person or any of such Person's Affiliates or Associates, or any other Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof), has: (A) any agreement, arrangement or understanding, whether or not in writing, (other than customary agreements with and between underwriters and selling group members with respect to a bona fide public offering of securities) for the purpose of acquiring, holding, voting (except to the extent contemplated by the proviso to Section 1(c)(ii)(B)) or disposing of such securities of the Company or (B) any agreement, arrangement or understanding, whether or not in writing, to cooperate in obtaining, changing or influencing control of the Company; or (iv) that are the subject of, or the reference securities for, or that underlie, any Derivative Interest of such Person or any of such Person's Affiliates or Associates, or any other Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof), in which case the number of Common Shares deemed Beneficially Owned by such Person in connection with such Derivative Interest shall be the notional or other number of Ordinary Shares (or the maximum number within any range) specified in the documentation evidencing the Derivative Interest as being subject to be acquired upon the exercise or settlement of the Derivative Interest or as the basis upon which the value or settlement amount of such Derivative Interest is to be calculated in whole or in part or, if no such number of Ordinary Shares is specified in such documentation, as determined by the Board in its sole discretion to be the number of Ordinary Shares to which the Derivative Interest relates;provided,however, that no Person who is an officer, director or employee of an Exempt Person shall be deemed, solely by reason of such Person's status or authority as such, to be the "Beneficial Owner" of, to have "Beneficial Ownership" of or to "beneficially own" any securities that are "beneficially owned" (as defined in this Section l(c)), including, without limitation, in a fiduciaryEXH-A-3capacity, by an Exempt Persononline or by any other such officer, director or employeephone instead of an Exempt Person; andprovided further, that nothing inmailing this paragraph (c) shall cause a Person engaged in business as an underwriter of securities to be the "Beneficial Owner" of, or to "beneficially own," any securities acquired through such Person's participation in good faith in a firm commitment underwriting (and any securities that may be acquired by such a Person pursuant to any customary over-allotment option granted in connection therewith) until the expiration of forty days after the date of such acquisition, and then only if such securities continue to be owned by such Person at such expiration of forty days. (d) "Book Entry" shall mean an uncertificated book entry in the register of members of the Company maintained in the account system of the transfer agent for the Company's Ordinary Shares or Preferred Shares, as applicable. (e) "Business Day" shall mean any day other than a Saturday, a Sunday or a day on which banking institutions in the State of New York, the State of New Jersey or the city in which the principal office of the Rights Agent is located are authorized or obligated by law or executive order to close. (f) "Close of Business" on any given date shall mean 5:00 P.M., New York City time, on such date;provided,however, that if such date is not a Business Day it shall mean 5:00 P.M., New York City time, on the next succeeding Business Day. (g) "Current Value" shall have the meaning set forth in Section 11(a)(iii) hereof. (h) "Derivative Interest" shall mean an interest in any derivative securities (as defined under Rule 16a-1(c) under the Exchange Act, disregarding Rule 16a-1(c)(6) under the Exchange Act) that increase in value as the value of the underlying security increases, including, but not limited to, a long convertible security, a long call option and a short put option position, in each case, regardless of whether (x) such interest conveys any voting rights in such security, (y) such interest is required to be, or is capable of being, settled through delivery of such security or (z) transactions hedge the economic effect of such interest. (i) "Distribution Date" shall have the meaning set forth in Section 3 hereof. (j)�� "Equivalent Preferred Shares" shall have the meaning set forth in Section 11(b) hereof. (k) "Exchange Ratio" shall have the meaning set forth in Section 24 hereof. (l) "Exempt Person" shall mean the Company or any Subsidiary (as such term is hereinafter defined) of the Company, in each case including, without limitation, in its fiduciary capacity, or any employee benefit plan of the Company or of any Subsidiary of the Company, or any entity or trustee holding (or acting in a fiduciary capacity in respect of) Ordinary Shares for or pursuant to the terms of any such plan or for the purpose of funding any such plan or funding other employee benefits for employees of the Company or of any Subsidiary of the Company. (m) "Expiration Date" shall have the meaning set forth in Section 7 hereof. (n) "Final Expiration Date" shall have the meaning set forth in Section 7 hereof. (o) "Flip-In Event" shall have the meaning set forth in Section 11(a)(ii) hereof. (p) "Nasdaq" shall mean The Nasdaq Stock Market LLC.. (q) "New York Stock Exchange" shall mean the New York Stock Exchange, Inc. (r) "Ordinary Shares" when used with reference to the Company shall mean the Ordinary Shares, par value $0.00001 per share, of the Company. "Ordinary Shares" when used with reference to any Person other than the Company shall mean the Ordinary Shares (or, in the case of any entity other than a corporation, the equivalent equity interest) with the greatest voting power of such other PersonEXH-A-4or, if such other Person is a Subsidiary of another Person, the Person or Persons which ultimately control such first-mentioned Person. (s) "Ordinary Share Equivalents" shall have the meaning set forth in Section 11(a)(iii) hereof. (t) "Person" shall mean any individual, firm, corporation, partnership, limited liability company, limited liability partnership, trust, association, syndicate, other entity, or an unincorporated group of persons, who by formal or informal agreement or arrangement, have embarked on a common purpose or act, and shall include, in each case, any successor (by merger or otherwise) to such Person. (u) "Preferred Share" shall mean the Series A Junior Participating Preferred Share, par value $0.00001 per share, of the Company having the rights and preferences set forth in the Amended and Restated Memorandum and Articles of Association attached to this Agreement as Exhibit A and, to the extent that there are not a sufficient number of shares of Series A Junior Participating Preferred Shares authorized to permit the full exercise of the Rights, Equivalent Preferred Shares. (v) "Principal Party" shall have the meaning set forth in Section 13(b) hereof. (w) "Purchase Price" shall have the meaning set forth in Section 7(b) hereof. (x) "Record Date" shall have the meaning set forth in the recitals hereto. (y) "Redemption Date" shall have the meaning set forth in Section 7 hereof. (z) "Redemption Price" shall have the meaning set forth in Section 23 hereof. (aa) "Right" shall have the meaning set forth in the recitals hereto. (bb) "Right Certificate" shall have the meaning set forth in Section 3 hereof. (cc) "Securities Act" shall mean the Securities Act of 1933, as amended. (dd) "Section 11(a)(ii) Trigger Date" shall have the meaning set forth in Section 11(a)(iii) hereof. (ee) "Share Acquisition Date" shall mean the first date of public announcement (which, for purposes of this definition, shall include, without limitation, a report filed pursuant to Section 13(d) of the Exchange Act) by the Company or an Acquiring Person that an Acquiring Person has become such, or such earlier date as a majority of the Board of Directors shall become aware of the existence of an Acquiring Person. (ff) "Spread" shall have the meaning set forth in Section 11(a)(iii) hereof. (gg) "Subsidiary" of any Person shall mean any corporation or other entity of which (i) a majority of the voting power of the voting equity securities or equity interest is owned, directly or indirectly, by such Person, (ii) securities or other ownership interests having ordinary voting power sufficient to elect a majority of the board of directors or other persons performing similar functions are beneficially owned, directly or indirectly, by such Person, and (iii) any corporation or other entity that is otherwise controlled by such Person. (hh) "Substitution Period" shall have the meaning set forth in Section 11(a)(iii) hereof. (ii) "Summary of Rights" shall have the meaning set forth in Section 3 hereof. (jj) "Trading Day" shall have the meaning set forth in Section 11(d)(i) hereof. Section 2. Appointment of Rights Agent. The Company hereby appoints the Rights Agent to act as agent for the Company in accordance with the express terms and conditions hereof (and no implied terms or conditions), and the Rights Agent hereby accepts such appointment. The Company may from time to time appoint such co-rights agents as it may deem necessary or desirable upon at least five (5) days' prior written notice to Rights Agent. In the event the Company appoints one or moreEXH-A-5co-rights agents, the Company shall deliver written notice to the Rights Agent setting forth the respective duties of each co-rights agent under the provisions of this Agreement as the Company reasonably determines. The Rights Agent shall not have a duty to supervise, and no event shall the Rights Agent be liable for, the acts or omissions of any such co-rights agent. Section 3. Issue of Right Certificates. (a) Until the Close of Business on the earlier of (i) the tenth day after the Share Acquisition Date or (ii) the tenth Business Day (or such later date as may be determined by action of the Board prior to such time as any Person becomes an Acquiring Person) after the date of the commencement (determined in accordance with Rule 14d-2 under the Exchange Act or any successor rule) by any Person (other than any Exempt Person) of, or after the first public announcement of the intention of any Person (other than any Exempt Person) to commence, a tender or exchange offer (which intention to commence remains in effect for five Business Days after such announcement), the consummation of which would result in any Person becoming an Acquiring Person (such earlier date hereinafter referred to as the "Distribution Date"), (x) the Rights will be evidenced (subject to the provisions of Section 3(b) hereof) by the certificates (if any) for Ordinary Shares registered in the names of the holders thereof, which certificates of Ordinary Shares shall be deemed also to be certificates for Rights (or, with respect to Ordinary Shares not represented by certificates, the Rights related thereto will be evidenced by notation on the register of members of the Company evidencing ownership of such Ordinary Shares), and, in each case, not by separate Right Certificates, and (y) the Rights will be transferable only in connection with the transfer of the Ordinary Shares evidencing such Rights. As soon as practicable after the Distribution Date, the Company will prepare and execute, the Rights Agent will countersign, upon written request from the Company, and the Company will send or cause to be sent (and the Rights Agent will, if requested to do so by the Company, and at the expense of the Company, and provided with all necessary information and documents, in form, format and substance satisfactory to the Rights Agent, send) by such means as the Company shall select, but in accordance with Section 26 (or direct the Rights Agent to use in a written notice), to each record holder of Ordinary Shares as of the close of business on the Distribution Date (other than any Acquiring Person or any Associate or Affiliate of an Acquiring Person), at the address of such holder shown on the records of the Company, the transfer agent or the registrar for the Ordinary Shares (and if the Rights Agent is not the transfer agent or registrar for the Ordinary Shares, the Company shall promptly provide such information to the Rights Agent in a form, format and substance satisfactory to the Rights Agent) a Right Certificate, in substantially the form of Exhibit B hereto (a "Right Certificate"), evidencing one Right (subject to adjustment as provided herein) for each Ordinary Share so held. As of and after the Distribution Date, the Rights will be evidenced solely by such Right Certificates. The Company shall promptly notify the Rights Agent in writing upon the occurrence of the Distribution Date. Until such written notice is received by the Rights Agent, the Rights Agent may presume conclusively for all purposes that the Distribution Date has not occurred. (b) On the Record Date, or as soon as practicable thereafter, the Company will send a copy of a Summary of Rights to Purchase Preferred Shares, in substantially the form of Exhibit C hereto (the "Summary of Rights"), by such means as the Company shall select, but in accordance with Section 26, to each record holder of Ordinary Shares as of the Close of Business on the Record Date (other than any Acquiring Person or any Associate or Affiliate of any Acquiring Person), at the address of such holder shown on the records of the Company. With respect to certificates (if any) for Ordinary Shares (or Book Entry Ordinary Shares) issued and outstanding as of the Record Date, until the Distribution Date, the Rights will be evidenced by such certificates registered in the names of the holders thereof (or such Book Entry shares) together with the Summary of Rights. Until the Distribution Date (or, if earlier, the Expiration Date), the surrender for transfer of any certificate for Ordinary Shares (or any Book Entry Ordinary Shares) issued and outstanding on the Record Date, with or without a copy ofEXH-A-6the Summary of Rights, shall also constitute the transfer of the Rights associated with the Ordinary Shares represented thereby. (c) Rights shall be issued in respect of all Ordinary Shares issued or disposed of (including, without limitation, upon transfer or exchange or disposition of Ordinary Shares out of treasury or issuance or reissuance of Ordinary Shares out of authorized but unissued share capital) after the Record Date but prior to the earlier of the Distribution Date and the Expiration Date, or in certain circumstances provided in Section 22 hereof, after the Distribution Date. Certificates issued for Ordinary Shares (including, without limitation, upon transfer of issued and outstanding Ordinary Shares, disposition of Ordinary Shares out of treasury or issuance or reissuance of Ordinary Shares out of authorized but unissued share capital) after the Record Date but prior to the earlier of the Distribution Date and the Expiration Date, or in certain circumstances provided in Section 22 hereof, after the Distribution Date shall have impressed on, printed on, written on or otherwise affixed to them a legend in substantially the following form: This certificate also evidences and entitles the holder hereof to certain Rights as set forth in a Rights Agreement between Theravance Biopharma, Inc., a Cayman Islands exempted company (the "Company") and [Computershare Trust Company, N.A., a federally chartered trust company] (or any successor rights agent), as rights agent (the "Rights Agent"), dated as of [ ] [ ], 20[ ] and as amended, supplemented, restated, extended or renewed from time to time (the "Rights Agreement"), the terms of which are hereby incorporated herein by reference and a copy of which is on file at the principal executive offices of the Company. Under certain circumstances, as set forth in the Rights Agreement, such Rights will be evidenced by separate certificates and will no longer be evidenced by this certificate. The Company will deliver to the holder of this certificate a copy of the Rights Agreement without charge after receipt of a written request therefor. Under certain circumstances, as set forth in the Rights Agreement, Rights owned by or transferred to any Person who is or becomes an Acquiring Person or Affiliate or Associate thereof, or any other Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof), (as those terms are defined in the Rights Agreement) and certain transferees thereof will become null and void and will no longer be transferable. With respect to any Book Entry Ordinary Shares, a legend in substantially the form of the foregoing shall be included in a notice to the record holder of such shares in accordance with applicable law. With respect to such certificates containing a legend in substantially the form of the foregoing, or any notice delivered to the holders of Book Entry shares in accordance with the preceding sentence, until the Distribution Date the Rights associated with the Ordinary Shares represented by such certificates or Book Entry shares shall be evidenced by such certificates or Book Entry shares alone, and the surrender for transfer of any such certificate or Book Entry share, except as otherwise provided herein, shall also constitute the transfer of the Rights associated with the Ordinary Shares represented thereby. In the event that the Company purchases or otherwise acquires any Ordinary Shares after the Record Date but prior to the Distribution Date, any Rights associated with such Ordinary Shares shall be deemed canceled and retired so that the Company shall not be entitled to exercise any Rights associated with the Ordinary Shares which are no longer issued and outstanding. Notwithstanding this paragraph (c), neither the omission of a legend nor the failure to deliver the notice of such legend required hereby shall affect the enforceability of any part of this Agreement or the rights of any holder of the Rights. Section 4. Form of Right Certificates. The Right Certificates (and the forms of election to purchase shares and of assignment to be printed on the reverse thereof) when, as and if issued, shall be substantially in the form set forth in Exhibit B hereto and may have such marks of identification or designation and such legends, summaries or endorsements printed thereon as the Company may deemEXH-A-7appropriate (which do not affect the rights, duties or responsibilities of the Rights Agent) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any applicable law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange or interdealer quotation system on which the Rights may from time to time be listed or quoted, or to conform to usage. Subject to the provisions of this Agreement, the Right Certificates shall entitle the holders thereof to purchase such number of one one-thousandths of a Preferred Share as shall be set forth therein at the Purchase Price, but the number of such one one-thousandths of a Preferred Share and the Purchase Price shall be subject to adjustment as provided herein. The Company shall give written notice to the Rights Agent promptly after it becomes aware of the existence of any Acquiring Person, and until such written notice is received by the Rights Agent, the Rights Agent shall not be deemed to have knowledge that any person has become an Acquiring Person, or have any duty or obligation in connection with any person becoming an Acquiring Person. Section 5. Countersignature and Registration. (a) The Right Certificates shall be executed on behalf of the Company by the Company's Chief Executive Officer either manually or by facsimile signature, shall have affixed thereto the Company's seal or a facsimile thereof and shall be attested by the Secretary of the Company, either manually or by facsimile signature. The Right Certificates shall be manually or facsimile countersigned by the Rights Agent, upon the Company's written request as set forth above, and shall not be valid for any purpose unless countersigned. In case any officer of the Company who shall have signed any of the Right Certificates shall cease to be such officer of the Company before countersignature by the Rights Agent and issuance and delivery by the Company, such Right Certificates, nevertheless, may be countersigned by the Rights Agent and issued and delivered by the Company with the same force and effect as though the Person who signed such Right Certificates had not ceased to be such officer of the Company; and any Right Certificate may be signed on behalf of the Company by any Person who, at the actual date of the execution of such Right Certificate, shall be a proper officer of the Company to sign such Right Certificate, although at the date of the execution of this Agreement any such Person was not such an officer. (b) Following the Distribution Date and receipt by the Rights Agent of written notice by the Company to that effect and all other relevant information and documents referred to in Section 3(a), the Rights Agent will keep or cause to be kept, at an office(s) or agency(ies) designated by the Rights Agent for such purpose, books for registration and transfer of the Right Certificates issued hereunder. Such books shall show the names and addresses of the respective holders of the Right Certificates, the number of Rights evidenced on its face by each of the Right Certificates and the date of each of the Right Certificates. Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates. (a) Subject to the provisions of this Agreement, at any time after the Close of Business on the Distribution Date and at or prior to the Close of Business on the Expiration Date, any Right Certificate or Right Certificates (other than Right Certificates representing Rights that have become null and void) may be transferred, split up, combined or exchanged for another Right Certificate or Right Certificates, entitling the registered holder to purchase a like number of one one-thousandths of a Preferred Share (or such shares of the Principal Party, if any, as shall be issuable in lieu of such one-hundredths of a Preferred Share pursuant to Section 13(a) hereof) as the Right Certificate or Right Certificates surrendered then entitled such holder to purchase. Any registered holder desiring to transfer any Right Certificate shall surrender the Right Certificate at the office of the Rights Agent designated by it for such purpose with the form of assignment on the reverse side thereof duly endorsed (or enclose with such Right Certificate a written instrument of transfer in a form satisfactory to the Company and the Rights Agent, duly executed by the registered holder thereof or the registeredEXH-A-8holder's attorney duly authorized in writing), and with all signatures duly guaranteed. Any registered holder desiring to, split up, combine or exchange any Right Certificate or Right Certificates shall make such request in writing delivered to the Rights Agent, and shall surrender the Right Certificate or Right Certificates to be transferred, split up, combined or exchanged at the office(s) or agency(ies) of the Rights Agent designated by it for such purpose, along with a signature guarantee (if required) and such other and further documentation as the Company or Rights Agent may reasonably request. Neither the Rights Agent nor the Company shall be obligated to take any action whatsoever with respect to the transfer of any such surrendered Right Certificate or Right Certificates until the registered holder thereof shall have (i) properly completed and duly signed the certificate contained in the form of assignment set forth on the reverse side of each such Right Certificate and (ii) provided such additional evidence of the identity of each Beneficial Owner (or former Beneficial Owner) (and Affiliates and Associates thereof , or any other Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof)) as the Company or the Rights Agent shall reasonably request. Thereupon the Rights Agent shall countersign (by manual or facsimile signature) and deliver to the Person entitled thereto a Right Certificate or Right Certificates, as the case may be, as so requested, registered in such name or names as may be designated by the surrendering registered holder. The Company or the Rights Agent may require payment from the holder of a sum sufficient to cover any tax or charge that may be imposed in connection with any transfer, split up, combination or exchange of Right Certificates. If and to the extent the Company does require payment of any such taxes or charges, the Company shall give the Rights Agent prompt written notice thereof and the Rights Agent shall not deliver any Rights Certificate unless and until the Rights Agent is satisfied that all such payments have been made, and the Rights Agent shall forward any such sum collected by it to the Company or to such Persons as the Company specifies by written notice. The Rights Agent shall have no duty or obligation to take any action under any section of this Agreement that requires the payment of taxes and/or charges related to the issuance or delivery of Rights Certificates unless and until the Rights Agent is satisfied that all such taxes and/or charges have been paid. (b) Subject to the provisions of this Agreement, at any time after the Distribution Date and prior to the Expiration Date, upon receipt by the Company and the Rights Agent of evidence satisfactory to them of the loss, theft, destruction or mutilation of a Right Certificate, and, in case of loss, theft or destruction, of indemnity or security satisfactory to them, along with such other and further documentation as the Company or the Rights Agent may reasonably request, and, at the Company's or Rights Agent's request, reimbursement to the Company and the Rights Agent of all reasonable expenses incidental thereto, and upon surrender to the Rights Agent and cancellation of the Right Certificate if mutilated, the Company will make, execute and deliver a new Right Certificate of like tenor to the Rights Agent for countersignature and delivery to the registered holder in lieu of the Right Certificate so lost, stolen, destroyed or mutilated. Without limiting the foregoing, the Company or the Rights Agent may require the owner of any lost, stolen or destroyed Right Certificate, or his legal representative, to give the Company a bond sufficient to indemnify the Company and the Rights Agent against any claim that may be made against it on account of the alleged loss, theft or destruction of any such Right Certificate or the issuance of any such new Right Certificate. Section 7. Exercise of Rights, Purchase Price; Expiration Date of Rights. (a) Except as otherwise provided herein, the Rights shall become exercisable on the Distribution Date, and thereafter the registered holder of any Right Certificate may, subject to Section 11(a)(ii) hereof and except as otherwise provided herein, exercise the Rights evidenced thereby in whole or in part upon surrender of the Right Certificate, with the form of election to purchase on the reverse side thereof properly completed and duly executed (with such signature duly guaranteed, if required), to the Rights Agent at the office(s) or agency(ies) of the Rights Agent designated by it for such purpose, together with payment of the aggregate Purchase Price with respect to the total number of one one-thousandths of a Preferred Share (or other securities, cash or other assets, as the case may be) asEXH-A-9to which the Rights are exercised, and an amount equal to any tax or charge required to be paid under Section 9(e) hereof, at any time which is both after the Distribution Date and prior to the time (the "Expiration Date") that is the earliest of (i) the Close of Business on[ ] [ ], 20[ ] [NB: Tenth anniversary] (the "Final Expiration Date"), (ii) the time at which the Rights are redeemed as provided in Section 23 hereof (the "Redemption Date"), (iii) the closing of any merger or other acquisition transaction involving the Company pursuant to an agreement of the type described in Sections 1(c)(ii)(A)(z) and 13 of this Agreement at which time the Rights are terminated or (iv) the time at which such Rights are exchanged as provided in Section 24 hereof. (b) The Purchase Price shall be initially $[ ] for each one one-thousandth of a Preferred Share purchasable upon the exercise of a Right. The Purchase Price and the number of one one-thousandths of a Preferred Share or other securities or property to be acquired upon exercise of a Right shall be subject to adjustment from time to time as provided in Sections 11 and 13 hereof and shall be payable in lawful money of the United States of America in accordance with paragraph (c) of this Section 7. (c) Except as otherwise provided herein, upon receipt of a Right Certificate representing exercisable Rights, with the form of election to purchase and the certificate properly completed and duly executed (with such signature duly guaranteed, if required), accompanied by payment of the aggregate Purchase Price for the Preferred Shares to be purchased and an amount equal to any applicable tax or charge required to be paid by the holder of such Right Certificate in accordance with Section 9 hereof, in cash or by certified check, cashier's check or money order payable to the order of the Company, the Rights Agent shall thereupon promptly as reasonably practicable (i) (A) requisition from the Company or any transfer agent of the Preferred Shares, or make available if the Rights Agent is the transfer agent for the Preferred Shares, certificates for the number of Preferred Shares to be purchased (or by Book Entry in respect of such shares), and the Company will comply and hereby irrevocably authorizes and directs its transfer agent to comply with all such requests, or (B) if the Company, in its sole discretion, shall have elected to deposit the Preferred Shares into a depositary, requisition from the depositary agent appointed by the Company depositary receipts representing interests in such number of one one-thousandths of a Preferred Share as are to be purchased (in which case certificates for the Preferred Shares represented by such receipts shall be deposited by the transfer agent with the depositary agent), and the Company will direct any such depositary agent to comply with such request, (ii) when necessary to comply with this Agreement, requisition from the Company the amount of cash to be paid in lieu of issuance of fractional shares in accordance with Section 14 hereof, (iii) after receipt of such certificates or depositary receipts, or confirmation or written notice from the Company that an entry has been made in the book-entry account system of the transfer agent, as the case may be, cause the same to be delivered to or upon the order of the registered holder of such Right Certificate, registered in such name or names as may be designated by such holder and (iv) when necessary to comply with this Agreement, after receipt, promptly deliver such cash to or upon the order of the registered holder of such Right Certificate. (d) Except as otherwise provided herein, in case the registered holder of any Right Certificate shall exercise less than all of the Rights evidenced thereby, a new Right Certificate evidencing Rights equivalent to the exercisable Rights remaining unexercised shall be issued by the Rights Agent to the registered holder of such Right Certificate or to his duly authorized assigns, subject to the provisions of Section 14 hereof. (e) Notwithstanding anything in this Agreement to the contrary, neither the Rights Agent nor the Company shall be obligated to undertake any action with respect to a registered holder of Rights or other securities upon the occurrence of any purported transfer or exercise of such Rights or other securities pursuant to Section 6 hereof or this Section 7 unless such registered holder shall have (i) properly completed and duly executed the certificate contained in the form of assignment or form of election to purchase set forth on the reverse side of the Rights Certificate surrendered for such transfer or exercise and (ii) provided such additional evidence of the identity of each Beneficial Owner (or former Beneficial Owner) thereof as the Company or the Rights Agent shall reasonably request.EXH-A-10 Section 8. Cancellation and Destruction of Right Certificates. All Right Certificates surrendered for the purpose of exercise, transfer, split up, combination or exchange shall, if surrendered to the Company or to any of its agents, be delivered to the Rights Agent for cancellation or in canceled form, or, if surrendered to the Rights Agent, shall be canceled by it, and no Right Certificates shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Agreement. The Company shall deliver to the Rights Agent for cancellation and retirement, and the Rights Agent shall so cancel and retire, any other Right Certificate purchased or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent shall deliver all canceled Right Certificates to the Company, or shall, at the written request of the Company, destroy or cause to be destroyed, such canceled Right Certificates, and in such case shall deliver a certificate of destruction thereof to the Company. Section 9. Availability of Preferred Shares. (a) The Company covenants and agrees that it will cause to be kept available out of its authorized and unissued Preferred Shares or any Preferred Shares held in its treasury, the number of Preferred Shares that will be sufficient to permit the exercise in full of all issued and outstanding Rights. (b) So long as the Preferred Shares issuable upon the exercise of Rights may be listed or admitted to trading on any national securities exchange, the Company shall use its best efforts to cause, from and after such time as the Rights become exercisable, all shares reserved for such issuance to be listed or admitted to trading on such exchange, upon official notice of issuance upon such exercise. (c) From and after such time as the Rights become exercisable, the Company shall use its best efforts, if then necessary to permit the issuance of Preferred Shares upon the exercise of Rights, to register and qualify such Preferred Shares under the Securities Act and any applicable state securities or "Blue Sky" laws (to the extent exemptions therefrom are not available), cause such registration statement and qualifications to become effective as soon as possible after such filing and keep such registration and qualifications effective (with a prospectus at all times meeting the requirements of the Securities Act) until the earlier of the date as of which the Rights are no longer exercisable for such securities and the Expiration Date. The Company may temporarily suspend, for a period of time not to exceed 90 days, the exercisability of the Rights in order to prepare and file a registration statement under the Securities Act and permit it to become effective. Upon any such suspension, the Company shall issue a public announcement stating that the exercisability of the Rights has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in effect. The Company shall notify the Rights Agent in writing whenever it makes a public announcement pursuant to this Section 9(c) and give the Rights Agent a copy of such announcement. Notwithstanding any provision of this Agreement to the contrary, the Rights shall not be exercisable in any jurisdiction unless the requisite qualification in such jurisdiction shall have been obtained and until a registration statement under the Securities Act shall have been declared effective, unless an exemption therefrom is available. (d) The Company covenants and agrees that it will take all such action as may be necessary to ensure that all Preferred Shares delivered upon exercise of Rights shall, at the time of entry of such Preferred Shares on the register of members of the Company (subject to payment of the Purchase Price), be duly and validly authorized and issued and fully paid and nonassessable shares. (e) The Company further covenants and agrees that it will pay when due and payable any and all taxes and charges which may be payable in respect of the issuance or delivery of the Right Certificates or of any Preferred Shares upon the exercise of Rights. The Company shall not, however, be required to pay any tax or charge which may be payable in respect of any transfer or delivery of Right Certificates to a Person other than, or the issuance or delivery of certificates or depositary receipts for the Preferred Shares in a name other than that of, the registered holder of the Right Certificate evidencing Rights surrendered for exercise or to issue or deliver any certificates or depositary receipts for Preferred Shares upon the exercise of any Rights until any such tax or charge shall have been paidEXH-A-11(any such tax or charge being payable by that holder of such Right Certificate at the time of surrender) or until it has been established to the Company's and the Rights Agent's satisfaction that no such tax or charge is due. Section 10. Preferred Share Record Date. Each Person in whose name any certificate or Book Entry for Preferred Shares (or other securities as permitted by this Agreement) is issued upon the exercise of Rights shall for all purposes be deemed to have become the holder of record of the Preferred Shares or other such securities represented thereby on, and such certificate or Book Entry shall be dated, the date upon which the Right Certificate evidencing such Rights was duly surrendered and payment of the Purchase Price (and any applicable taxes or charges) was made;provided,however, that if the date of such surrender and payment is a date upon which the Preferred Shares transfer books of the Company are closed, such Person shall be deemed to have become the record holder of such shares on, and such certificate shall be dated, the next succeeding Business Day on which the Preferred Shares transfer books of the Company are open. Prior to the exercise of the Rights evidenced thereby, the holder of a Right Certificate shall not be entitled to any rights of a holder of Preferred Shares for which the Rights shall be exercisable, including, without limitation, the right to vote or to receive dividends or other distributions, and shall not be entitled to receive any notice of any proceedings of the Company, except as provided herein. Section 11. Adjustment of Purchase Price, Number and Kind of Shares and Number of Rights. The Purchase Price, the number of Preferred Shares or other securities or property purchasable upon exercise of each Right and the number of Rights issued and outstanding are subject to adjustment from time to time as provided in this Section 11. (a) (i) In the event the Company shall at any time after the date of this Agreement (A) declare and pay a dividend or distribution on the Preferred Shares payable in Preferred Shares, (B) subdivide or split the issued and outstanding Preferred Shares, (C) combine or consolidate the issued and outstanding Preferred Shares into a smaller number of Preferred Shares or (D) issue any shares of its share capital in a reclassification of the Preferred Shares (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing or surviving corporation), except as otherwise provided in this Section 11(a), the number and kind of share capital issuable upon exercise of a Right as of the record date for such dividend or the effective date of such subdivision, split, combination, consolidation or reclassification shall be proportionately adjusted so that the holder of any Right exercised after such time shall be entitled to receive the aggregate number and kind of share capital which, if such Right had been exercised immediately prior to such date and at a time when the register of members of Preferred Shares of the Company were open, the holder would have owned upon such exercise and been entitled to receive by virtue of such dividend, distribution, subdivision, split, combination, consolidation or reclassification. (ii) Subject to Section 24 of this Agreement, in the event any Person becomes an Acquiring Person (the first occurrence of such event being referred to hereinafter as the "Flip-In Event"), then (A) the Purchase Price shall be adjusted to be the Purchase Price in effect immediately prior to the Flip-In Event multiplied by the number of one one-thousandths of a Preferred Share for which a Right was exercisable immediately prior to such Flip-In Event, whether or not such Right was then exercisable, and (B) each holder of a Right, except as otherwise provided in this Section 11(a)(ii) and Section 11(a)(iii) hereof, shall thereafter have the right to receive, upon exercise thereof at a price equal to the Purchase Price (as so adjusted), in accordance with the terms of this Agreement and in lieu of Preferred Shares, such number of Ordinary Shares as shall equal the result obtained by dividing the Purchase Price (as so adjusted) by 50% of the current per share market price of the Ordinary Shares (determined pursuant to Section 11(d) hereof) on the date of such Flip-In Event;provided,however, that the Purchase Price (as so adjusted) and the number of Ordinary Shares so receivable upon exercise of a Right shall, following the Flip-In Event, be subject to further adjustment as appropriate in accordance with Section 11(f) hereof.EXH-A-12Notwithstanding anything in this Agreement to the contrary, however, from and after the Flip-In Event, any Rights that are beneficially owned by (x) any Acquiring Person (or any Affiliate or Associate of any Acquiring Person) or any other Person with whom such Acquiring Person is Acting in Concert (or any Affiliate or Associate thereof), (y) a transferee of any Acquiring Person (or any such Affiliate or Associate) or any other Person with whom such Acquiring Person is Acting in Concert (or any Affiliate or Associate thereof),who becomes a transferee after the Flip-In Event or (z) a transferee of any Acquiring Person (or any such Affiliate or Associate) or any other Person with whom such Acquiring Person is Acting in Concert (or any Affiliate or Associate thereof) who became a transferee prior to or concurrently with the Flip-In Event pursuant to either (I) a transfer from the Acquiring Person (or any Affiliate or Associate of any Acquiring Person) or from any other Person with whom such Acquiring Person is Acting in Concert (or any Affiliate or Associate thereof) to holders of such transferor's equity securities or to any Person with whom such transferor has any continuing agreement, arrangement or understanding regarding the transferred Rights or (II) a transfer which the Board of Directors has determined is part of a plan, arrangement or understanding which has the purpose or effect of avoiding the provisions of this paragraph, and subsequent transferees of such Persons, shall be null and void without any further action and any holder of such Rights shall thereafter have no rights whatsoever with respect to such Rights under any provision of this Agreement. The Company shall use all reasonable efforts to ensure that the provisions of this Section 11(a)(ii) are complied with, but shall have no liability hereunder to any holder of Right Certificates or other Person as a result of its failure to make any determinations with respect to an Acquiring Person or any other Person with whom such Acquiring Person is Acting in Concert or any Affiliate, Associate or transferee thereof. From and after the Flip-In Event, no Right Certificate shall be issued pursuant to Section 3 or Section 6 hereof that represents Rights that are or have become null and void pursuant to the provisions of this paragraph, and any Right Certificate delivered to the Rights Agent that represents Rights that are or have become null and void pursuant to the provisions of this paragraph shall, upon receipt of written notice directing it to do so, be canceled by the Rights Agent. From and after the occurrence of an event specified in Section 13(a) hereof, any Rights that theretofore have not been exercised pursuant to this Section 11(a)(ii) shall thereafter be exercisable only in accordance with Section 13 and not pursuant to this Section 11(a)(ii). (iii) The Company may at its option substitute for an Ordinary Share issuable upon the exercise of Rights in accordance with the foregoing subparagraph (ii) a number of Preferred Shares or fraction thereof such that the current per share market price of one Preferred Share multiplied by such number or fraction is equal to the current per share market price of one Ordinary Share. In the event that there shall not be sufficient Ordinary Shares issued but not issued and outstanding or authorized but unissued to permit the exercise in full of the Rights in accordance with the foregoing subparagraph (ii), the Board of Directors shall, with respect to such deficiency, to the extent permitted by applicable law and any material agreements then in effect to which the Company is a party, (A) determine the excess (such excess, the "Spread") of (1) the value of the Ordinary Shares issuable upon the exercise of a Right in accordance with the foregoing subparagraph (ii) (the "Current Value") over (2) the Purchase Price (as adjusted in accordance with the foregoing subparagraph (ii)), and (B) with respect to each Right (other than Rights which have become null and void pursuant to the foregoing subparagraph (ii)), make adequate provision to substitute for the Ordinary Shares issuable in accordance with the foregoing subparagraph (ii) upon exercise of the Right and payment of the Purchase Price (as adjusted in accordance therewith), (1) cash, (2) a reduction in such Purchase Price, (3) Preferred Shares or other equity securities of the Company (including, without limitation, shares or fractions of Preferred Shares which, by virtue of having dividend, voting and liquidation rights substantially comparable to those of the Ordinary Shares, are deemed in good faith by the Board of Directors to have substantially the same value as the Ordinary Shares (such Preferred Shares and shares orEXH-A-13fractions of Preferred Shares are hereinafter referred to as "Ordinary Share Equivalents")), (4) debt securities of the Company, (5) other assets, or (6) any combination of the foregoing, having a value which, when added to the value of the Ordinary Shares issued upon exercise of such Right, shall have an aggregate value equal to the Current Value (less the amount of any reduction in such Purchase Price), where such aggregate value has been determined by the Board of Directors upon consideration of the advice of a nationally recognized investment banking firm selected in good faith by the Board of Directors;provided,however, that if the Company shall not make adequate provision to deliver value pursuant to clause (B) above within thirty (30) days following the Flip-In Event (the date of the Flip-In Event being the "Section 11(a)(ii) Trigger Date"), then the Company shall be obligated to deliver, to the extent permitted by applicable law and any material agreements then in effect to which the Company is a party, upon the surrender for exercise of a Right and without requiring payment of such Purchase Price, Ordinary Shares (to the extent available), and then, if necessary, such number or fractions of Preferred Shares (to the extent available) and then, if necessary, cash, which shares and/or cash have an aggregate value equal to the Spread. If, upon the occurrence of the Flip-In Event, the Board of Directors shall determine in good faith that it is likely that sufficient additional Ordinary Shares could be authorized for issuance upon exercise in full of the Rights, then, if the Board of Directors so elects, the thirty (30) day period set forth above may be extended to the extent necessary, but not more than ninety (90) days after the Section 11(a)(ii) Trigger Date, in order that the Company may seek shareholder approval for the authorization of such additional shares (such thirty (30) day period, as it may be extended, is herein called the "Substitution Period"). To the extent that the Company determines that some action need be taken pursuant to the second and/or third sentence of this Section 11(a)(iii), the Company (x) shall provide, subject to Section 11(a)(ii) hereof and the last sentence of this Section 11(a)(iii) hereof, that such action shall apply uniformly to all issued and outstanding Rights and (y) may suspend the exercisability of the Rights until the expiration of the Substitution Period in order to seek any authorization of additional shares and/or to decide the appropriate form of distribution to be made pursuant to such second sentence and to determine the value thereof. In the event of any such suspension, the Company shall issue a public announcement (with prompt written notice thereof to the Rights Agent) stating that the exercisability of the Rights has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in effect, in each case with prompt written notice to the Rights Agent. For purposes of this Section 11(a)(iii), the per share value of the Ordinary Shares shall be the current per share market price (as determined pursuant to Section 11(d)(i)) on the Section 11(a)(ii) Trigger Date and the per share or fractional value of any "Ordinary Share Equivalent" shall be deemed to equal the current per share market price of the Ordinary Shares. The Board of Directors of the Company may, but shall not be required to, establish procedures to allocate the right to receive Ordinary Shares upon the exercise of the Rights among the holders of Rights pursuant to this Section 11(a)(iii). (b) In case the Company shall fix a record date for the issuance of rights (other than the Rights), options or warrants to all holders of Preferred Shares entitling them (for a period expiring within 45 calendar days after such record date) to subscribe for or purchase Preferred Shares (or shares having the same rights, privileges and preferences as the Preferred Shares ("Equivalent Preferred Shares")) or securities convertible into Preferred Shares or Equivalent Preferred Shares at a price per Preferred Share or Equivalent Preferred Shares (or having a conversion price per share, if a security convertible into Preferred Shares or Equivalent Preferred Shares) less than the then current per share market price of the Preferred Shares (determined pursuant to Section 11(d) hereof) on such record date, the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the number of Preferred Shares and Equivalent Preferred Shares issued and outstanding on such record date plus the number of Preferred Shares and Equivalent Preferred Shares which the aggregate offeringEXH-A-14price of the total number of Preferred Shares and/or Equivalent Preferred Shares so to be offered (and/or the aggregate initial conversion price of the convertible securities so to be offered) would purchase at such current market price, and the denominator of which shall be the number of Preferred Shares and Equivalent Preferred Shares issued and outstanding on such record date plus the number of additional Preferred Shares and/or Equivalent Preferred Shares to be offered for subscription or purchase (or into which the convertible securities so to be offered are initially convertible);provided,however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the share capital of the Company issuable upon exercise of one Right. In case such subscription price may be paid in a consideration part or all of which shall be in a form other than cash, the value of such consideration shall be as determined in good faith by the Board of Directors of the Company, whose determination shall be described in a statement filed with the Rights Agent and shall be binding and conclusive for all purposes on the Rights Agent. Preferred Shares and Equivalent Preferred Shares owned by or held for the account of the Company shall not be deemed issued and outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed; and in the event that such rights, options or warrants are not so issued, the Purchase Price shall be adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed. (c) In case the Company shall fix a record date for the making of a distribution to all holders of the Preferred Shares (including any such distribution made in connection with a consolidation or merger in which the Company is the continuing or surviving corporation) of evidences of indebtedness or assets (other than a regular quarterly cash dividend or a dividend payable in Preferred Shares) or subscription rights or warrants (excluding those referred to in Section 11(b) hereof), the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the then current per share market price of the Preferred Shares (determined pursuant to Section 11(d) hereof) on such record date, less the fair market value (as determined in good faith by the Board of Directors of the Company whose determination shall be described in a statement filed with the Rights Agent and shall be binding and conclusive for all purposes on the Rights Agent) of the portion of the assets or evidences of indebtedness so to be distributed or of such subscription rights or warrants applicable to one Preferred Share, and the denominator of which shall be such current per share market price (determined pursuant to Section 11(d) hereof) of the Preferred Shares;provided,however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the share capital of the Company to be issued upon exercise of one Right. Such adjustments shall be made successively whenever such a record date is fixed; and in the event that such distribution is not so made, the Purchase Price shall again be adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed. (d) (i) Except as otherwise provided herein, for the purpose of any computation hereunder, the "current per share market price" of any security (a "Security" for the purpose of this Section 11(d)(i)) on any date shall be deemed to be the average of the daily closing prices per share of such Security for the 30 consecutive Trading Days (as such term is hereinafter defined) immediately prior to but not including such date;provided,however, that in the event that the current per share market price of the Security is determined during a period following the announcement by the issuer of such Security of (A) a dividend or distribution on such Security payable in shares of such Security or securities convertible into such shares, or (B) any subdivision, combination or reclassification of such Security, and prior to the expiration of 30 Trading Days after the ex-dividend date for such dividend or distribution, or the record date for such subdivision, combination or reclassification, then, and in each such case, the current per share market price shall be appropriately adjusted to reflect the current market price per share equivalent of such Security. The closing price for each day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported by the principal consolidated transaction reportingEXH-A-15system with respect to securities listed or admitted to trading on the New York Stock Exchange or Nasdaq or, if the Security is not listed or admitted to trading on the New York Stock Exchange or Nasdaq, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Security is listed or admitted to trading or, if the Security is not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average of the high and low asked prices in the over-the-counter market, as reported by any system then in use, or, if not quoted, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Security selected by the Board of Directors of the Company. The term "Trading Day" shall mean a day on which the principal national securities exchange on which the Security is listed or admitted to trading is open for the transaction of business or, if the Security is not listed or admitted to trading on any national securities exchange, a Business Day. (ii) For the purpose of any computation hereunder, if the Preferred Shares are publicly traded, the "current per share market price" of the Preferred Shares shall be determined in accordance with the method set forth in Section 11(d)(i). If the Preferred Shares are not publicly traded but the Ordinary Shares are publicly traded, the "current per share market price" of the Preferred Shares shall be conclusively deemed to be the current per share market price of the Ordinary Shares as determined pursuant to Section 11(d)(i) multiplied by the then applicable Adjustment Number (as defined in and determined in accordance with the terms of the Preferred Shares). If neither the Ordinary Shares nor the Preferred Shares are publicly traded, "current per share market price" shall mean the fair value per share as determined in good faith by the Board of Directors of the Company, whose determination shall be described in a statement filed with the Rights Agent and shall be binding and conclusive for all purposes. (e) No adjustment in the Purchase Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Purchase Price;provided,however, that any adjustments which by reason of this Section 11(e) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 11 shall be made to the nearest cent or to the nearest one hundred-thousandth of a Preferred Share or one-hundredth of an Ordinary Share or other share or security as the case may be. Notwithstanding the first sentence of this Section 11(e), any adjustment required by this Section 11 shall be made no later than the earlier of (i) three years from the date of the transaction which requires such adjustment or (ii) the Expiration Date. (f) If as a result of an adjustment made pursuant to Section 11(a) hereof, the holder of any Right thereafter exercised shall become entitled to receive any share capital of the Company other than the Preferred Shares, thereafter the Purchase Price and the number of such other shares so receivable upon exercise of a Right shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Preferred Shares contained in Sections 11(a), 11(b), 11(c), 11(e), 11(h), 11(i) and 11(m) hereof, as applicable, and the provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the Preferred Shares shall apply on like terms to any such other shares. (g) All Rights originally issued by the Company subsequent to any adjustment made to the Purchase Price hereunder shall evidence the right to purchase, at the adjusted Purchase Price, the number of one one-thousandths of a Preferred Share purchasable from time to time hereunder upon exercise of the Rights, all subject to further adjustment as provided herein. (h) Unless the Company shall have exercised its election as provided in Section 11(i), upon each adjustment of the Purchase Price as a result of the calculations made in Sections 11(b) and 11(c), each Right issued and outstanding immediately prior to the making of such adjustment shall thereafter evidence the right to purchase, at the adjusted Purchase Price, that number of one one-thousandths ofEXH-A-16a Preferred Share (calculated to the nearest one hundred-thousandth of a Preferred Share) obtained by (i) multiplying (x) the number of one one-thousandths of a share purchasable upon the exercise of a Right immediately prior to such adjustment by (y) the Purchase Price in effect immediately prior to such adjustment and (ii) dividing the product so obtained by the Purchase Price in effect immediately after such adjustment. (i) The Company may elect on or after the date of any adjustment of the Purchase Price pursuant to Sections 11(b) or 11(c) hereof to adjust the number of Rights, in substitution for any adjustment in the number of one one-thousandths of a Preferred Share purchasable upon the exercise of a Right. Each of the Rights issued and outstanding after such adjustment of the number of Rights shall be exercisable for the number of one one-thousandths of a Preferred Share for which a Right was exercisable immediately prior to such adjustment. Each Right held of record prior to such adjustment of the number of Rights shall become that number of Rights (calculated to the nearest one-hundredth) obtained by dividing the Purchase Price in effect immediately prior to adjustment of the Purchase Price by the Purchase Price in effect immediately after adjustment of the Purchase Price. The Company shall make a public announcement (with prompt written notice thereof to the Rights Agent) of its election to adjust the number of Rights, indicating the record date for the adjustment, and, if known at the time, the amount of the adjustment to be made. Such record date may be the date on which the Purchase Price is adjusted or any day thereafter, but, if the Right Certificates have been issued, shall be at least 10 days later than the date of the public announcement. If Right Certificates have been issued, upon each adjustment of the number of Rights pursuant to this Section 11(i), the Company may, as promptly as practicable, cause to be distributed to holders of record of Right Certificates on such record date Right Certificates evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution and replacement for the Right Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if required by the Company, new Right Certificates evidencing all the Rights to which such holders shall be entitled after such adjustment. Right Certificates so to be distributed shall be issued, executed and delivered by the Company, and countersigned and delivered by the Rights Agent, in the manner provided for herein and shall be registered in the names of the holders of record of Right Certificates on the record date specified in the public announcement. (j) Irrespective of any adjustment or change in the Purchase Price or the number of one one-thousandths of a Preferred Share issuable upon the exercise of a Right, the Right Certificates theretofore and thereafter issued may continue to express the Purchase Price and the number of one one-thousandths of a Preferred Share which were expressed in the initial Right Certificates issued hereunder. (k) Before taking any action that would cause an adjustment reducing the Purchase Price below the then par value, if any, of the fraction of Preferred Shares or other share capital issuable upon exercise of a Right, the Company shall take any corporate action which may, in the opinion of its counsel, be necessary in order that the Company may validly and legally issue fully paid and nonassessable Preferred Shares or other such shares at such adjusted Purchase Price. (l) In any case in which this Section 11 shall require that an adjustment in the Purchase Price be made effective as of a record date for a specified event, the Company may elect to defer (with prompt written notice thereof to the Rights Agent, and until such written notice is received by the Rights Agent, the Rights Agent may presume conclusively that no such election has occurred) until the occurrence of such event issuing to the holder of any Right exercised after such record date the Preferred Shares and other share capital or securities of the Company, if any, issuable upon such exercise over and above the Preferred Shares and other share capital or securities of the Company, if any, issuable upon such exercise on the basis of the Purchase Price in effect prior to such adjustment;provided,however, that the Company shall deliver to such holder a due bill or other appropriate instrument evidencing such holder's right to receive such additional shares upon the occurrence of the event requiring such adjustment.EXH-A-17 (m) Anything in this Section 11 to the contrary notwithstanding, the Company shall be entitled to make such adjustments in the Purchase Price, in addition to those adjustments expressly required by this Section 11, as and to the extent that it in its sole discretion shall determine to be advisable in order that any consolidation or subdivision of the Preferred Shares, issuance wholly for cash of any Preferred Shares at less than the current market price, issuance wholly for cash of Preferred Shares or securities which by their terms are convertible into or exchangeable for Preferred Shares, dividends on Preferred Shares payable in Preferred Shares or issuance of rights, options or warrants referred to hereinabove in Section 11(b), hereafter made by the Company to holders of its Preferred Shares shall not be taxable to such shareholders. (n) Anything in this Agreement to the contrary notwithstanding, in the event that at any time after the date of this Agreement and prior to the Distribution Date, the Company shall (i) declare and pay any dividend on the Ordinary Shares payable in Ordinary Shares or (ii) effect a subdivision, combination or consolidation of the Ordinary Shares (by reclassification or otherwise than by payment of a dividend payable in Ordinary Shares) into a greater or lesser number of Ordinary Shares, then, in each such case, the number of Rights associated with each Ordinary Share then issued and outstanding, or issued or delivered thereafter, shall be proportionately adjusted so that the number of Rights thereafter associated with each Ordinary Share following any such event shall equal the result obtained by multiplying the number of Rights associated with each Ordinary Share immediately prior to such event by a fraction the numerator of which shall be the total number of Ordinary Shares issued and outstanding immediately prior to the occurrence of the event and the denominator of which shall be the total number of Ordinary Shares issued and outstanding immediately following the occurrence of such event. (o) The Company agrees that, after the earlier of the Distribution Date or the Share Acquisition Date, it will not, except as permitted by Sections 23, 24 or 27 hereof, take (or permit any Subsidiary to take) any action if at the time such action is taken it is reasonably foreseeable that such action will diminish substantially or eliminate the benefits intended to be afforded by the Rights. Section 12. Certificate of Adjusted Purchase Price or Number of Shares. Whenever an adjustment is made or any event affecting the Rights or their exercisability (including, without limitation, an event which causes Rights to become null and void) occurs as provided in Section 11 or 13 hereof, the Company shall promptly (a) prepare a certificate setting forth such adjustment or describing such event, and a brief, reasonably detailed statement of the facts, methodology and computations accounting for such adjustment, (b) file with the Rights Agent and with each transfer agent for the Ordinary Shares and the Preferred Shares a copy of such certificate and (c) mail a brief summary thereof to each holder of a Right Certificate in accordance with Section 25 hereof (if so required under Section 25 hereof). The Rights Agent shall be fully protected in relying on any such certificate and on any adjustment or statement therein contained and shall have no duty or liability with respect to, and shall not be deemed to have knowledge of any such adjustment or event unless and until it shall have received such certificate. Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power. (a) In the event, directly or indirectly, at any time after the Flip-In Event (i) the Company shall consolidate with or shall merge into any other Person, (ii) any Person shall merge with and into the Company and the Company shall be the continuing or surviving corporation of such merger and, in connection with such merger, all or part of the Ordinary Shares shall be changed into or exchanged for shares or other securities of any other Person (or of the Company) or cash or any other property, or (iii) the Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one or more transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to any other Person (other than the Company or one or more wholly-owned Subsidiaries of the Company), then upon theEXH-A-18first occurrence of such event, proper provision shall be made so that: (A) each holder of a Right (other than Rights which have become null and void pursuant to Section 11(a)(ii) hereof) shall thereafter have the right to receive, upon the exercise thereof at the Purchase Price (as theretofore adjusted in accordance with Section 11(a)(ii) hereof), in accordance with the terms of this Agreement and in lieu of Preferred Shares or Ordinary Shares of the Company, such number of validly authorized and issued, fully paid, non-assessable and freely tradable Ordinary Shares of the Principal Party (as such term is hereinafter defined), not subject to any liens, encumbrances, rights of first refusal or other adverse claims, as shall equal the result obtained by dividing the Purchase Price (as theretofore adjusted in accordance with Section 11(a)(ii) hereof) by 50% of the current per share market price of the Ordinary Shares of such Principal Party (determined pursuant to Section 11(d) hereof) on the date of consummation of such consolidation, merger, sale or transfer;provided,however, that the Purchase Price (as theretofore adjusted in accordance with Section 11(a)(ii) hereof) and the number of Ordinary Shares of such Principal Party so receivable upon exercise of a Right shall be subject to further adjustment as appropriate in accordance with Section 11(f) hereof to reflect any events occurring in respect of the Ordinary Shares of such Principal Party after the occurrence of such consolidation, merger, sale or transfer; (B) such Principal Party shall thereafter be liable for, and shall assume, by virtue of such consolidation, merger, sale or transfer, all the obligations and duties of the Company pursuant to this Agreement; (C) the term "Company" shall thereafter be deemed to refer to such Principal Party; and (D) such Principal Party shall take such steps (including, but not limited to, the reservation of a sufficient number of its Ordinary Shares in accordance with Section 9 hereof) in connection with such consummation of any such transaction as may be necessary to assure that the provisions hereof shall thereafter be applicable, as nearly as reasonably may be, in relation to the shares of its Ordinary Shares thereafter deliverable upon the exercise of the Rights (including, without limitation, that the terms hereof in respect of Preferred Shares, including without limitation the adjustment provisions of Section 11 hereof, shall thereafter apply, in a manner and on terms as nearly equivalent as practicable, with respect to the Ordinary Shares of the Principal Party);provided that, upon the subsequent occurrence of any consolidation, merger, sale or transfer of assets or other extraordinary transaction in respect of such Principal Party, each holder of a Right shall thereupon be entitled to receive, upon exercise of a Right and payment of the Purchase Price as provided in this Section 13(a), such cash, shares, rights, warrants and other property which such holder would have been entitled to receive had such holder, at the time of such transaction, owned the Ordinary Shares of the Principal Party receivable upon the exercise of a Right pursuant to this Section 13(a), and such Principal Party shall take such steps (including, but not limited to, reservation of shares) as may be necessary to permit the subsequent exercise of the Rights in accordance with the terms hereof for such cash, shares, rights, warrants and other property. (b) "Principal Party" shall mean: (i) in the case of any transaction described in (i) or (ii) of the first sentence of Section 13(a) hereof: (A) the Person that is the issuer of the securities into which the Ordinary Shares are converted in such merger or consolidation, or, if there is more than one such issuer, the issuer the Ordinary Shares of which have the greatest aggregate market value of shares issued and outstanding, or (B) if no securities are so issued, (x) the Person that is the other party to the merger, if such Person survives said merger, or, if there is more than one such Person, the Person the Ordinary Shares of which have the greatest aggregate market value of shares issued and outstanding or (y) if the Person that is the other party to the merger does not survive the merger, the Person that does survive the merger (including the Company if it survives) or (z) the Person resulting from the consolidation; and (ii) in the case of any transaction described in (iii) of the first sentence of Section 13(a) hereof, the Person that is the party receiving the greatest portion of the assets or earning power transferred pursuant to such transaction or transactions, or, if each Person that is a party to suchEXH-A-19transaction or transactions receives the same portion of the assets or earning power so transferred or if the Person receiving the greatest portion of the assets or earning power cannot be determined, whichever of such Persons is the issuer of Ordinary Shares having the greatest aggregate market value of shares issued and outstanding;provided,however, that in any such case described in the foregoing clause (b)(i) or (b)(ii), if the Ordinary Shares of such Person is not at such time or has not been continuously over the preceding 12-month period registered under Section 12 of the Exchange Act, then (1) if such Person is a direct or indirect Subsidiary of another Person the Ordinary Shares of which is and has been so registered, the term "Principal Party" shall refer to such other Person, or (2) if such Person is a Subsidiary, directly or indirectly, of more than one Person, the Ordinary Shares of all of which are and have been so registered, the term "Principal Party" shall refer to whichever of such Persons is the issuer of Ordinary Shares having the greatest aggregate market value of shares issued and outstanding, or (3) if such Person is owned, directly or indirectly, by a joint venture formed by two or more Persons that are not owned, directly or indirectly, by the same Person, the rules set forth in clauses (1) and (2) above shall apply to each of the owners having an interest in the venture as if the Person owned by the joint venture was a Subsidiary of both or all of such joint venturers, and the Principal Party in each such case shall bear the obligations set forth in this Section 13 in the same ratio as its interest in such Person bears to the total of such interests. (c) The Company shall not consummate any consolidation, merger, share exchange, sale or transfer referred to in Section 13(a) hereof unless prior thereto the Company and the Principal Party involved therein shall have executed and delivered to the Rights Agent an agreement confirming that the requirements of Sections 13(a) and (b) hereof shall promptly be performed in accordance with their terms and that such consolidation, merger, share exchange, sale or transfer of assets shall not result in a default by the Principal Party under this Agreement as the same shall have been assumed by the Principal Party pursuant to Sections 13(a) and (b) hereof and providing that, as soon as practicable after executing such agreement pursuant to this Section 13, the Principal Party will: (i) prepare and file a registration statement under the Securities Act, if necessary, with respect to the Rights and the securities purchasable upon exercise of the Rights on an appropriate form, use its best efforts to cause such registration statement to become effective as soon as practicable after such filing and use its best efforts to cause such registration statement to remain effective (with a prospectus at all times meeting the requirements of the Securities Act) until the Expiration Date and similarly comply with applicable state securities laws; (ii) use its best efforts, if the Ordinary Shares of the Principal Party shall be listed or admitted to trading on the New York Stock Exchange, Nasdaq or on another national securities exchange, to list or admit to trading (or continue the listing of) the Rights and the securities purchasable upon exercise of the Rights on the New York Stock Exchange, Nasdaq or such securities exchange, or, if the Ordinary Shares of the Principal Party shall not be listed or admitted to trading on the New York Stock Exchange, Nasdaq or another national securities exchange, to cause the Rights and the securities receivable upon exercise of the Rights to be authorized for quotation on any other system then in use; (iii) deliver to holders of the Rights historical financial statements for the Principal Party which comply in all respects with the requirements for registration on Form 10 (or any successor form) under the Exchange Act; and (iv) obtain waivers of any rights of first refusal or preemptive rights in respect of the Ordinary Shares of the Principal Party subject to purchase upon exercise of issued and outstanding Rights. (d) In case the Principal Party has a provision in any of its authorized securities or in its certificate of incorporation or by-laws or other instrument governing its affairs, which provision would have the effect of (i) causing such Principal Party to issue (other than to holders of Rights pursuant toEXH-A-20this Section 13), in connection with, or as a consequence of, the consummation of a transaction referred to in this Section 13, Ordinary Shares or Ordinary Share Equivalents of such Principal Party at less than the then-current market price per share thereof (determined pursuant to Section 11(d) hereof) or securities exercisable for, or convertible into, Ordinary Shares or Ordinary Share Equivalents of such Principal Party at less than such then current market price, or (ii) providing for any special payment, tax or similar provision in connection with the issuance of the Ordinary Shares of such Principal Party pursuant to the provisions of Section 13, then, in such event, the Company hereby agrees with each holder of Rights that it shall not consummate any such transaction unless prior thereto the Company and such Principal Party shall have executed and delivered to the Rights Agent a supplemental written agreement providing that the provision in question of such Principal Party shall have been canceled, waived or amended, or that the authorized securities shall be redeemed, so that the applicable provision will have no effect in connection with, or as a consequence of, the consummation of the proposed transaction. (e) The Company covenants and agrees that it shall not, at any time after the Flip-In Event, enter into any transaction of the type described in clauses (i) through (iii) of Section 13(a) hereof if (i) at the time of or immediately after such consolidation, merger, sale, transfer or other transaction there are any rights, warrants or other instruments or securities issued and outstanding or agreements in effect which would substantially diminish or otherwise eliminate the benefits intended to be afforded by the Rights, (ii) prior to, simultaneously with or immediately after such consolidation, merger, sale, transfer or other transaction, the shareholders of the Person who constitutes, or would constitute, the Principal Party for purposes of Section 13(b) hereof shall have received a distribution of Rights previously owned by such Person or any of its Affiliates or Associates or any other Person with whom such Acquiring Person is Acting in Concert (or any Affiliate or Associate thereof) or (iii) the form or nature of organization of the Principal Party would preclude or limit the exercisability of the Rights. Section 14. Fractional Rights and Fractional Shares. (a) The Company shall not be required to issue fractions of Rights (except prior to the Distribution Date in accordance with Section 11(n) hereof) or to distribute Right Certificates which evidence fractional Rights. In lieu of such fractional Rights, there shall be paid to the registered holders of the Right Certificates with regard to which such fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the current market value of a whole Right. For the purposes of this Section 14(a), the current market value of a whole Right shall be the closing price of the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable. The closing price for any day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the New York Stock Exchange or Nasdaq or, if the Rights are not listed or admitted to trading on the New York Stock Exchange or Nasdaq, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Rights are listed or admitted to trading or, if the Rights are not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by any system then in use or, if on any such date the Rights are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Rights selected by the Board of Directors of the Company. If on any such date no such market maker is making a market in the Rights, the fair value of the Rights on such date as determined in good faith by the Board of Directors of the Company shall be used, whose determination shall be described in a written statement filed with the Rights Agent. (b) The Company shall not be required to issue fractions of Preferred Shares (other than fractions which are integral multiples of one one-thousandth of a Preferred Share) or to distribute certificatesEXH-A-21which evidence fractional Preferred Shares (other than fractions which are integral multiples of one one-thousandth of a Preferred Share) upon the exercise or exchange of Rights. Interests in fractions of Preferred Shares in integral multiples of one one-thousandth of a Preferred Share may, at the election of the Company, be evidenced by depositary receipts, pursuant to an appropriate agreement between the Company and a depositary selected by it;provided, that such agreement shall provide that the holders of such depositary receipts shall have all the rights, privileges and preferences to which they are entitled as beneficial owners of the Preferred Shares represented by such depositary receipts. In lieu of fractional Preferred Shares that are not integral multiples of one one-thousandth of a Preferred Share, the Company shall pay to the registered holders of Right Certificates at the time such Rights are exercised or exchanged as herein provided an amount in cash equal to the same fraction of the current market value of a whole Preferred Share (as determined in accordance with Section 14(a) hereof) for the Trading Day immediately prior to the date of such exercise or exchange. (c) The Company shall not be required to issue fractions of Ordinary Shares or to distribute certificates which evidence fractional Ordinary Shares upon the exercise or exchange of Rights. In lieu of such fractional Ordinary Shares, the Company shall pay to the registered holders of the Right Certificates with regard to which such fractional Ordinary Shares would otherwise be issuable an amount in cash equal to the same fraction of the current market value of a whole Ordinary Share. For purposes of this Section 14(c), the current market value of one Ordinary Share for which a Rights is exercisable shall be deemed to be the closing price of one Ordinary Share (as determined in accordance with Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of such exercise or exchange. (d) The holder of a Right by the acceptance of the Right expressly waives his right to receive any fractional Rights or any fractional shares upon exercise or exchange of a Right (except as provided above). (e) Whenever a payment for fractional Rights or fractional shares is to be made by the Rights Agent, the Company shall (i) promptly prepare and deliver to the Rights Agent a certificate setting forth in reasonable detail the facts related to such payments and the prices and/or formulas utilized in calculating such payments, and (ii) provide sufficient monies to the Rights Agent in the form of fully collected funds to make such payments. The Rights Agent shall be fully protected in relying upon such a certificate and shall have no duty with respect to, and shall not be deemed to have knowledge of any payment for fractional Rights or fractional shares under any Section of this Agreement relating to the payment of fractional Rights or fractional shares unless and until the Rights Agent shall have received such a certificate and sufficient monies. Section 15. Rights of Action. All rights of action in respect of this Agreement, excepting the rights of action given to the Rights Agent hereunder, including but not limited to under Section 18 and 20 hereof, are vested in the respective registered holders of the Right Certificates (and, prior to the Distribution Date, the registered holders of the Ordinary Shares); and any registered holder of any Right Certificate (or, prior to the Distribution Date, of the Ordinary Shares), without the consent of the Rights Agent or of the holder of any other Right Certificate (or, prior to the Distribution Date, of the Ordinary Shares), on his own behalf and for his own benefit, may enforce, and may institute and maintain any suit, action or proceeding against the Company to enforce, or otherwise act in respect of, his right to exercise the Rights evidenced by such Right Certificate (or, prior to the Distribution Date, such Ordinary Shares) in the manner provided therein and in this Agreement. Without limiting the foregoing or any remedies available to the holders of Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for any breach by the Company of this Agreement and will be entitled to specific performance of the obligations under, and injunctive relief against actual or threatened violations by the Company of, the obligations of any Person subject to this Agreement.EXH-A-22 Section 16. Agreement of Right Holders. Every holder of a Right, by accepting the same, consents and agrees with the Company and the Rights Agent and with every other holder of a Right that: (a) prior to the Distribution Date, the Rights will not be evidenced by a Rights Certificate and will be transferable only in connection with the transfer of the Ordinary Shares; (b) after the Distribution Date, the Right Certificates are transferable only on the registry books of the Rights Agent if surrendered at the office(s) or agency(ies) of the Rights Agent designated by it for such purpose, duly endorsed or accompanied by a proper instrument of transfer and with appropriate forms and certificates contained therein properly completed and duly executed, including a signature guarantee, if required, and such other documentation as the Rights Agent may reasonably request; and (c) subject to the other provisions herein, the Company and the Rights Agent may deem and treat the Person in whose name the Right Certificate (or, prior to the Distribution Date, the Ordinary Shares certificate (or Book Entry shares in respect of Ordinary Shares)) is registered as the absolute owner thereof and of the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Right Certificates or the Ordinary Shares certificate (or notices provided to holders of Book Entry Ordinary Shares) made by anyone other than the Company or the Rights Agent) for all purposes whatsoever, and neither the Company nor the Rights Agent, subject to Section 7(e) hereof, shall be affected by any notice to the contrary. (d) notwithstanding anything in this Agreement to the contrary, to the fullest extent permitted by applicable law, neither the Company nor the Rights Agent, nor any of their directors, officers, employees and agents, shall have any liability to any holder of a Right or other Person as a result of its inability to perform any of its obligations under this Agreement by reason of any preliminary or permanent injunction or other order, decree, judgment or ruling (whether interlocutory or final) issued by a court of competent jurisdiction or by a governmental, regulatory, self-regulatory or administrative agency or commission, or by reason of any statute, rule, regulation or executive order promulgated or enacted by any governmental authority, prohibiting or otherwise restraining performance of such obligation. Section 17. Right Certificate Holder Not Deemed a Shareholder. No holder of a Right Certificate, as such, shall be entitled to vote, receive dividends or be deemed for any purpose the holder of the Preferred Shares or any other securities of the Company which may at any time be issuable on the exercise or exchange of the Rights represented thereby, nor shall anything contained herein or in any Right Certificate be construed to confer upon the holder of any Right Certificate, as such, any of the rights of a shareholder of the Company or any right to vote for the election of directors or upon any mattercard. Votes submitted to shareholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as provided in this Agreement), or to receive dividends or subscription rights, or otherwise, until the Rights evidenced by such Right Certificate shall have been exercised or exchanged in accordance with the provisions hereof. Section 18. Concerning the Rights Agent. (a) The Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it hereunder and, from time to time, on demand of the Rights Agent, its reasonable expenses and counsel fees and expenses and other disbursements incurred in the preparation, delivery, amendment, administration and execution of this Agreement and the exercise and performance of its duties hereunder. The Company also agrees to indemnify the Rights Agent for, and to hold it harmless against, any loss, liability, damage, demand, judgment, fine, penalty, claim, settlement, cost or expense (including without limitation, the reasonable fees and expenses of legal counsel), paid, incurred, or suffered by it, or to which it may become subject, without gross negligence, bad faith or willfulEXH-A-23misconduct on the part of the Rights Agent (each as determined by a final, non-appealable judgment of a court of competent jurisdiction) for any action taken, suffered or omitted to be taken by the Rights Agent in connection with the execution, acceptance, administration, exercise and performance of its duties under this Agreement, including but not limited to the costs and expenses of defending against any claim of liability arising therefrom, directly or indirectly, or enforcing its rights hereunder. (b) The Rights Agent shall be authorized to rely conclusively on and shall be protected and shall incur no liability for or in respect of any action taken, suffered or omitted to be taken by it in connection with, its acceptance and administration of this Agreement and the exercise and performance of its duties hereunder in reliance upon any Right Certificate or certificate for the Preferred Shares or Ordinary Shares or for any other securities of the Company, instrument of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, statement or other paper or document believed by it to be genuine and to be signed, executed and, where necessary, guaranteed, verified or acknowledged, by the proper Person or Persons, or otherwise upon the advice of counsel as set forth in Section 20 hereof. The Rights Agent shall not be deemed to have knowledge of any event of which it was supposed to receive notice thereof hereunder, but for which it has not received such notice, and the Rights Agent shall be fully protected and shall incur no liability for failing to take action in connection therewith unless and until it has received such notice in writing. (c) The provisions of this Section 18 and Section 20 below shall survive the termination of this Agreement, the resignation, replacement or removal of the Rights Agent and the exercise, termination and the expiration of the Rights. To the extent successful in whole or in part, the costs and expenses incurred by the Rights Agent in enforcing its right of indemnification shall be paid by the Company. Notwithstanding anything in this Agreement to the contrary, in no event shall the Rights Agent be liable for special, punitive, incidental, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Rights Agent has been advised of the likelihood of such loss or damage and regardless of the form of the action; and the Company agrees to indemnify the Rights Agent and to hold it harmless to the fullest extent permitted by law against any loss, liability or expense incurred as a result of claims for special, punitive, incidental, indirect or consequential loss or damages of any kind whatsoeverprovided that such claims are not based on the gross negligence, bad faith or willful misconduct of the Rights Agent (each as determined by a final, non-appealable judgment of a court of competent jurisdiction). Any liability of the Rights Agent under this Agreement shall be limited to the amount of annual fees paid by the Company to the Rights Agent. Section 19. Merger or Consolidation or Change of Name of Rights Agent. (a) Any entity into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or any entity resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any entity succeeding to the share transfer or corporate trust or shareowner services powers of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto;provided, that such entity would be eligible for appointment as a successor Rights Agent under the provisions of Section 21 hereof. The purchase of all or substantially all of the Rights Agent's assets employed in the performance of transfer agent activities shall be deemed a merger or consolidation for the purposes of this Section 19,provided that the entity purchasing such assets meets the criteria to serve as a successor Rights Agent under the provisions of Section 21 hereof and agrees to be bound by the terms hereof. In case at the time such successor Rights Agent shall succeed to the agency created by this Agreement, any of the Right Certificates shall have been countersigned but not delivered, any such successor Rights Agent may adopt the countersignature of the predecessor Rights Agent and deliver such Right Certificates so countersigned; and in case at that time any of the Right Certificates shall not have been countersigned, any successor Rights Agent may countersign such Right Certificates either in the name of the predecessor Rights Agent or in the name of the successor Rights Agent; and in all such casesEXH-A-24such Right Certificates shall have the full force provided in the Right Certificates and in this Agreement. (b) In case at any time the name of the Rights Agent shall be changed and at such time any of the Right Certificates shall have been countersigned but not delivered, the Rights Agent may adopt the countersignature under its prior name and deliver Right Certificates so countersigned; and in case at that time any of the Right Certificates shall not have been countersigned, the Rights Agent may countersign such Right Certificates either in its prior name or in its changed name and in all such cases such Right Certificates shall have the full force provided in the Right Certificates and in this Agreement. Section 20. Duties of Rights Agent. The Rights Agent undertakes to perform only the duties and obligations expressly imposed by this Agreement (and no implied duties or obligations) upon the following terms and conditions, by all of which the Company and the holders of Right Certificates, by their acceptance thereof, shall be bound: (a) The Rights Agent may consult with legal counsel (who may be legal counsel for the Rights Agent (including such legal counsel employed by the Rights Agent) or the Company), and the advice or opinion of such counsel shall be full and complete authorization and protection to the Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted to be taken by it in the absence of bad faith, gross negligence or willful misconduct (each as determined by a final, non-appealable judgment of a court of competent jurisdiction) and in accordance with such advice or opinion. (b) Whenever in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter (including without limitation the identity of an Acquiring Person and the determination of any current market price) be proved or established by the Company prior to taking, suffering or omitting to take any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate signed by the Chief Executive Officer and the Secretary of the Company and delivered to the Rights Agent; and such certificate shall be full authorization and protection to the Rights Agent, and the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted to be taken by it, in the absence of bad faith, under the provisions of this Agreement in reliance upon such certificate. If the Rights Agent requests such a certificate, the Rights Agent shall have no duty to act until it has received such a certificate as set forth in the preceding sentence. (c) The Rights Agent shall be liable hereunder to the Company and any other Person only for its own gross negligence, bad faith or willful misconduct (each as determined by a final, non-appealable judgment of a court of competent jurisdiction). (d) The Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Agreement or in the Right Certificates (except its countersignature thereof) or be required to verify the same, but all such statements and recitals are and shall be deemed to have been made by the Company only. (e) The Rights Agent shall not have any liability for nor be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof (except the due execution hereof by the Rights Agent) or in respect of the validity or execution of any Right Certificate (except its countersignature thereof); nor shall it be liable or responsible for any breach by the Company of any covenant or condition contained in this Agreement or in any Right Certificate; nor shall it be liable or responsible for any change in the exercisability of the Rights (including the Rights becoming null and void pursuant to Section 11(a)(ii) hereof) or any change or adjustment in the terms of the Rights, including an adjustment provided for in Sections 3, 11, 13, 23 and 24, or responsible for the manner,EXH-A-25method or amount of any such adjustment, or the ascertaining of the existence of facts that would require any such change or adjustment (except with respect to the exercise of Rights evidenced by Right Certificates after receipt of a certificate furnished pursuant to Section 12, describing such change or adjustment, upon which the Rights Agent may conclusively rely); nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Preferred Shares or other securities to be issued pursuant to this Agreement or any Right Certificate or as to whether any Preferred Shares or other securities will, when issued, be validly authorized and issued, fully paid and nonassessable. (f) The Company agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered all such further and other acts, instruments and assurances as may reasonably be required by the Rights Agent for the carrying out or performing by the Rights Agent of the provisions of this Agreement. (g) The Rights Agent is hereby authorized and directed to accept written instructions with respect to the performance of its duties hereunder from any person reasonably believed by the Rights Agent to be one of the Chief Executive Officer or the Secretary of the Company, and to apply to such officers for advice or instructions in connection with its duties, and such advice or instruction shall be full authorization and protection to the Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken or suffered or omitted to be taken by it by it, in the absence of bad faith, in accordance with advice or instructions of any such officer or for any delay in acting while waiting for those instructions. Any application by the Rights Agent for written instructions from the Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken or omitted by the Rights Agent under this Agreement and the date on and/or after which such action shall be taken or such omission shall be effective. The Rights Agent shall be fully authorized and protected in relying upon the most recent instructions received from any such officer, and shall not be liable for any action taken, suffered or omitted to be taken by the Rights Agent in accordance with a proposal included in any such application on or after the date specified in such application (which date shall not be less than five Business Days after the date any officer of the Company actually receives such application unless any such officer shall have consented in writing to an earlier date) unless, prior to taking any such action (or the effective date in the case of an omission), the Rights Agent shall have received written instructions in response to such application specifying the action to be taken, suffered or omitted. Notwithstanding anything in this Agreement to the contrary, the Rights Agent shall not be required to take any action or to follow any instruction of the Company that the Rights Agent reasonably believes, after consultation with counsel, in its reasonable discretion, would cause the Rights Agent to take action that is illegal. (h) The Rights Agent and any shareholder, affiliate, director, officer, agent, representative or employee of the Rights Agent may buy, sell or deal in any of the Rights or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not Rights Agent under this Agreement. Nothing herein shall preclude the Rights Agent (or its shareholders, affiliates, directors, officers, agents, representatives or employees) from acting in any other capacity for the Company or for any other Person. (i) The Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself (through its directors, officers and employees) or by or through its attorneys or agents, and the Rights Agent shall not be liable, answerable or accountable for any act, omission, default, neglect or misconduct of any such attorneys or agents or for any loss to the Company, any holder of Rights or any other Person resulting from any such act, omission, default, neglect or misconduct, absent gross negligence, bad faith or willful misconduct (each as determined by a final, non-appealable judgment of a court of competent jurisdiction) in the selection and continued employment thereof.EXH-A-26 (j) If, with respect to any Rights Certificate surrendered to the Rights Agent for exercise or transfer, the certificate contained in the form of assignment or the form of election to purchase set forth on the reverse thereof, as the case may be, has not been completed, including without limitation, to certify the holder is not an Acquiring Person (or an Affiliate or Associate thereof) or any other Person with whom such Acquiring Person is Acting in Concert (or any Affiliate or Associate thereof), or a transferee thereof, the Rights Agent shall not take any further action with respect to such requested exercise or transfer without first consulting with the Company. (k) No provision of this Agreement shall require the Rights Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder (other than internal costs incurred by the Rights Agent in providing services to the Company in the ordinary course of its business as Rights Agent) or in the exercise of its rights if it believes that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it. (l) If, with respect to any Rights Certificate surrendered to the Rights Agent for exercise or transfer, the certificate contained in the form of assignment or the form of election to purchase set forth on the reverse thereof, as the case may be, has either not been properly completed to certify the holder is not an Acquiring Person (or an Affiliate or Associate thereof), together with any Person with whom such holder is Acting in Concert (or any Affiliate or Associate thereof), the Rights Agent shall not take any further action with respect to such requested exercise or transfer without first consulting with the Company. (m) The Rights Agent shall have no responsibility to the Company, any holders of Rights or any holders of shares of Common Stock for interest or earnings on any monies held by the Rights Agent pursuant to this Agreement. (n) The Rights Agent shall not be required to take notice or be deemed to have notice of any fact, event or determination (including, without limitation, any dates or events defined in this Agreement or the designation of any Person as an Acquiring Person (or an Affiliate or Associate thereof), together with any Person with whom such Person is Acting in Concert (or any Affiliate or Associate thereof)), under this Agreement, including any event or condition that may require action by the Rights Agent, unless and until the Rights Agent shall be specifically notified in writing by the Company of such fact, condition event or determination. Section 21. Change of Rights Agent. The Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this Agreement, for any reason whatsoever, upon 30 days' notice in writing mailed to the Company pursuant to Section 26, and to each transfer agent of the Ordinary Shares or Preferred Shares by trackable mail, in the event that the Rights Agent or one of its Affiliates is not also the transfer agent to the Company, and, following the Distribution Date, to the holders of the Right Certificates by trackable mail. The Company may remove the Rights Agent or any successor Rights Agent upon 30 days' written notice, mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Ordinary Shares or Preferred Shares by registered or certified mail, at the expense of the Company, and, following the Distribution Date, to the holders of the Right Certificates by first-class mail, at the expense of the Company. In the event the transfer agency relationship in effect between the Company and the Rights Agent terminates, the Rights Agent will be deemed to have resigned automatically and be discharged from its duties under this Agreement 30 days after the effective date of such termination, and the Company shall be responsible for sending any required notice. If the Rights Agent shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company shall fail to make such appointment within a period of 30 days after giving notice of such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the holder of a Right Certificate (who shall, with such notice, submit his Right Certificate for inspection by the Company), then the incumbent Rights Agent or registeredEXH-A-27holder of any Right Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the Company or by such a court, shall be (a) a Person organized and authorized to do business under the laws of the United States or the laws of any state of the United States or the District of Columbia, in good standing, which is authorized under applicable law to perform the services contemplated by this Agreement and which has at the time of its appointment as Rights Agent a combined capital and surplus of at least $50 million, or (b) an Affiliate of such a Person described in clause (a) of this sentence. After appointment, the successor Rights Agent shall be vested with the same powers, rights, duties, obligations, liabilities, immunities and responsibilities as if it had been originally named as Rights Agent under this Agreement without further act or deed; but the predecessor Rights Agent shall deliver and transfer to the successor Rights Agent any property at the time held by it hereunder, and execute and deliver, if applicable, any further assurance, conveyance, act or deed necessary for that purpose. Not later than the effective date of any such appointment the Company shall file notice thereof in writing with the predecessor Rights Agent and each transfer agent of the Ordinary Shares or Preferred Shares, and, following the Distribution Date, mail a notice thereof in writing to the registered holders of the Right Certificates. Failure to give any notice provided for in this Section 21, however, or any defect therein, shall not affect the legality or validity of the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be. Section 22. Issuance of New Right Certificates. Notwithstanding any of the provisions of this Agreement or of the Rights to the contrary, the Company may, at its option, issue new Right Certificates evidencing Rights in such forms as may be approved by its Board of Directors to reflect any adjustment or change in the Purchase Price and the number or kind or class of shares or other securities or property purchasable under the Right Certificates made in accordance with the provisions of this Agreement. In addition, in connection with the issuance or sale of Ordinary Shares following the Distribution Date and prior to the Expiration Date, the Company may with respect to Ordinary Shares so issued or sold (i) pursuant to the exercise of share options, (ii) under any employee plan or arrangement, (iii) upon the exercise, conversion or exchange of securities, notes or debentures issued by the Company or (iv) pursuant to a contractual obligation of the Company, in each case existing prior to the Distribution Date, issue Rights Certificates representing the appropriate number of Rights in connection with such issuance or sale. (a) The Board of Directors of the Company may, at any time prior to the Flip-In Event, redeem all but not less than all of the then issued and outstanding Rights at a redemption price of $.01 per Right, appropriately adjusted to reflect any share split, share dividend or similar transaction occurring in respect of the Ordinary Shares after the date hereof (the redemption price being hereinafter referred to as the "Redemption Price"). The redemption of the Rights may be made effective at such time, on such basis and with such conditions as the Board of Directors in its sole discretion may establish. The Redemption Price shall be payable, at the option of the Company, in cash, Ordinary Shares, or such other form of consideration as the Board of Directors shall determine. (b) Immediately upon the action of the Board of Directors ordering the redemption of the Rights pursuant to paragraph (a) of this Section 23 (or at such later time as the Board of Directors may establish for the effectiveness of such redemption) (evidence of which shall have been filed with the Rights Agent), and without any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter of the holders of Rights shall be to receive the Redemption Price for each Right so held. The Company shall promptly give public notice of any such redemption (with prompt written notice thereof to the Rights Agent);provided,however, that the failure to give, or any defect in, any such notice shall not affect the legality or validity of such redemption. Within 10 days after such action of the Board of Directors ordering the redemption of the Rights (or such later time as the Board of Directors may establish for the effectiveness of such redemption), the Company shallEXH-A-28mail a notice of redemption to all the holders of the then issued and outstanding Rights at their last addresses as they appear upon the registry books of the Company or the Rights Agent or, prior to the Distribution Date, on the registry books of the Company or the transfer agent for the Ordinary Shares. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such notice of redemption shall state the method by which the payment of the Redemption Price will be made, unless such notice is mailed together with such payment. (a) The Board of Directors of the Company may, at its option, at any time after the Flip-In Event, exchange all or part of the then issued and outstanding and exercisable Rights (which shall not include Rights that have become null and void pursuant to the provisions of Section 11(a)(ii) hereof) for Ordinary Shares at an exchange ratio of one Ordinary Share per Right, appropriately adjusted to reflect any share split, share dividend or similar transaction occurring in respect of the Ordinary Shares after the date hereof (such amount per Right being hereinafter referred to as the "Exchange Ratio"). Notwithstanding the foregoing, the Board of Directors shall not be empowered to effect such exchange at any time after an Acquiring Person shall have become a Beneficial Owner of Ordinary Shares aggregating 50% or more of the Ordinary Shares then issued and outstanding. From and after the occurrence of an event specified in Section 13(a) hereof, any Rights that theretofore have not been exchanged pursuant to this Section 24(a) shall thereafter be exercisable only in accordance with Section 13 and may not be exchanged pursuant to this Section 24(a). The exchange of the Rights by the Board of Directors may be made effective at such time, on such basis and with such conditions as the Board of Directors in its sole discretion may establish. (b) Immediately upon the effectiveness of the action of the Board of Directors of the Company ordering the exchange of any Rights pursuant to paragraph (a) of this Section 24 and without any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a holder of such Rights shall be to receive that number of Ordinary Shares equal to the number of such Rights held by such holder multiplied by the Exchange Ratio. The Company shall promptly give public notice of any such exchange (with prompt written notice thereof to the Rights Agent);provided,however, that the failure to give, or any defect in, such notice shall not affect the validity of such exchange. The Company shall promptly mail a notice of any such exchange to all of the holders of the Rights so exchanged at their last addresses as they appear upon the registry books of the Rights Agent. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such notice of exchange will state the method by which the exchange of the Ordinary Shares for Rights will be effected and, in the event of any partial exchange, the number of Rights which will be exchanged. Any partial exchange shall be effected pro rata based on the number of Rights (other than Rights which have become null and void pursuant to the provisions of Section 11(a)(ii) hereof) held by each holder of Rights. (c) Following the action of the Board ordering the exchange of any Rights pursuant to Section 24(a) hereof, the Company may implement such procedures in its sole discretion as it deems appropriate for the purpose of ensuring that the Ordinary Shares or other consideration issuable upon an exchange pursuant to this Section 24 notelectronically must be received by holders of Rights that have become null11:59 PM, Eastern Time, on April 26, 2021 If no electronic voting, delete QR code and void pursuantcontrol # ∆ ≈ Online Go to www.investorvote.com/TBPH HYPERLINK “http://www.investorvote.com/TBPH” or scan the second paragraph of Section 11(a)(ii) hereof. In furtherance thereof, if so directed by the Company, Ordinary Shares or other consideration potentially issuable to holders of Rights upon an exchange pursuant to this Section 24, who have not verified to the satisfaction of the Company, in its sole discretion, that theyQR code — login details are not Acquiring Persons, may be deposited in a trust established by the Company pending receipt of appropriate verification. (d) The Company may at its option substitute, and,located in the event that there shall not be sufficient Ordinary Shares authorized that have not been issued, subscribedshaded bar below. Phone Call toll free 1-800-652-VOTE (8683) within the USA, US territories and Canada Save paper, time and money! Sign up for or otherwise reserved for issuanceEXH-A-29Tableelectronic delivery at www.investorvote.com/TBPH • Election of Contentsor committed to be issued, to permit an exchange of Rights for Ordinary Shares as contemplated in accordance with this Section 24, the Company shall substitute to the extent of such insufficiency, for each Ordinary Share that would otherwise be issuable upon exchange of a Right, a number of Preferred Shares or fraction thereof (or Equivalent Preferred Shares, as such term is defined in Section 11(b)) such that the current per share market price (determined pursuant to Section 11(d) hereof) of one Preferred Share (or Equivalent Preferred Share) multiplied by such number or fraction is equal to the current per share market price of one Ordinary Share (determined pursuant to Section 11(d) hereof) as of the date of such exchange. (e) The Company shall not be required to issue fractions of Ordinary Shares or to distribute certificates that evidence fractional Ordinary Shares. In lieu of such fractional Ordinary Shares, the Company shall pay to the registered holders of the Right Certificates with regard to which such fractional Ordinary Shares would otherwise be issuable an amount in cash equal to the same fraction of the current market value of a whole Ordinary Share. For the purposes of this Section 24(e), the current market value of a whole Ordinary Share shall be the closing price of an Ordinary Share (as determined pursuant to the second sentence of Section 11(d)(i) hereof) for the Trading Day immediately after the date of the first public announcement by the Company that an exchange is to be effected pursuant to this Section 24. Section 25. Notice of Certain Events. (a) In case the Company shall at any time after the earlier of the Distribution Date or the Share Acquisition Date propose (i) to pay any dividend payable in shares of any class to the holders of its Preferred Shares or to make any other distribution to the holders of its Preferred Shares (other than a regular quarterly cash dividend), (ii) to offer to the holders of its Preferred Shares rights or warrants to subscribe for or to purchase any additional Preferred Shares or shares of any class or any other securities, rights or options, (iii) to effect any reclassification of its Preferred Shares (other than a reclassification involving only the subdivision or combination of issued and outstanding Preferred Shares), (iv) to effect the liquidation, dissolution or winding up of the Company, or (v) to pay any dividend on the Ordinary Shares payable in Ordinary Shares or to effect a subdivision, combination or consolidation of the Ordinary Shares (by reclassification or otherwise than by payment of dividends in Ordinary Shares), then, in each such case, the Company shall give to the Rights Agent and to each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of such proposed action, which shall specify the record date for the purposes of such dividend or distribution or offering of rights or warrants, or the date on which such liquidation, dissolution, winding up, reclassification, subdivision, combination or consolidation is to take place and the date of participation therein by the holders of the Ordinary Shares and/or Preferred Shares, if any such date is to be fixed, and such notice shall be so given in the case of any action covered by clause (i) or (ii) above at least 10 days prior to the record date for determining holders of the Preferred Shares for purposes of such action, and in the case of any such other action, at least 10 days prior to the date of the taking of such proposed action or the date of participation therein by the holders of the Ordinary Shares and/or Preferred Shares, whichever shall be the earlier. (b) In case any event described in Section 11(a)(ii) or Section 13 shall occur then the Company shall as soon as practicable thereafter give to the Rights Agent and to each holder of a Right Certificate (or if occurring prior to the Distribution Date, the holders of the Ordinary Shares) in accordance with Section 26 hereof, a written notice of the occurrence of such event, which notice shall describe such event and the consequences of such event to holders of Rights under Section 11(a)(ii) and Section 13 hereof. Section 26. Notices. Notices or demands authorized by this Agreement to be given or made by the Rights Agent or by the holder of any Right Certificate to or on the Company shall be sufficientlyEXH-A-30given or made if in writing and sent by trackable mail, postage prepaid, addressed (until another address is filed in writing with the Rights Agent) as follows:Theravance Biopharma, Inc.P.O. Box 309, Ugland HouseGrand CaymanKY1 1104Cayman IslandsAttention: Chief Executive OfficerWith a copy to:Theravance Biopharma, Inc.c/o Theravance Biopharma US, Inc.901 Gateway BoulevardSouth San Francisco, CA 94080Attention: General Counsel Any notice or demand authorized by this Agreement to be given or made by the Company or by the holder of any Right Certificate to or on the Rights Agent shall be sufficiently given or made if in writing and sent by trackable mail, postage prepaid, addressed (until another address is filed in writing with the Company) as follows:[Computershare Trust Company, N.A.250 Royall StreetCanton, MA 02021Attention: Client Services]With a copy to:[Computershare Trust Company, N.A.462 South 4th Street, Suite 1600Louisville, KY 40202Attention: Client Services] Notices or demands authorized by this Agreement to be given or made by the Company or the Rights Agent to the holder of any Right Certificate shall be sufficiently given or made if sent by national or international courier or first-class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the registry books of the Company or the Rights Agent or the transfer agent. Section 27. Supplements and Amendments. Except as provided in the fourth sentence of this Section 27, for so long as the Rights are then redeemable, the Company may in its sole and absolute discretion, and the Rights Agent shall if the Company so directs, in writing, supplement or amend any provision of this Agreement in any respect without the approval of any holders of the Rights. At any time when the Rights are no longer redeemable, except as provided in the fourth sentence of this Section 27, the Company may, and the Rights Agent shall, if the Company so directs in writing, supplement or amend this Agreement without the approval of any holders of Rights,provided that no such supplement or amendment may (a) adversely affect the interests of the holders of Rights as such (other than an Acquiring Person or an Affiliate or Associate of an Acquiring Person), (b) cause this Agreement again to become amendable other than in accordance with this sentence or (c) cause the Rights again to become redeemable. Notwithstanding anything contained in this Agreement to the contrary, no supplement or amendment shall be made which changes the Redemption Price. Upon the delivery of a certificate from an appropriate officer of the Company, which states that the proposed supplement or amendment is in compliance with the terms of this Section 27, the Rights Agent shallEXH-A-31promptly execute such supplement or amendment,provided, that notwithstanding anything to the contrary contained herein, the Rights Agent may, but shall not be obligated to, enter into any supplement or amendment that affects the Rights Agent's own rights, duties, obligations or immunities under this Rights Agreement. Section 28. Successors; Assignment. All the covenants and provisions of this Agreement by or for the benefit of the Company or the Rights Agent shall bind and inure to the benefit of their respective successors and assigns hereunder. This Agreement shall extend to and shall be binding upon the parties hereto and their respective successors and permitted assigns;provided,however, that this Agreement shall not be assignable by either party without prior written consent of the other party; andprovided,further, that, notwithstanding the foregoing, (a) the foregoing proviso shall not apply to assignments by the Rights Agent to an affiliate or subsidiary of the Rights Agent and (b) any reorganization, merger, consolidation, sale of assets or other form of business combination by the Rights Agent shall not be deemed to constitute an assignment of this Agreement, and shall not require the consent of the Company with respect thereto. Section 29. Benefits of this Agreement. Nothing in this Agreement shall be construed to give to any Person other than the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the Ordinary Shares) any legal or equitable right, remedy or claim under this Agreement; but this Agreement shall be for the sole and exclusive benefit of the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the Ordinary Shares). Section 30. Determinations and Actions by the Board of Directors. The Board of Directors of the Company shall have the exclusive power and authority to administer this Agreement and to exercise the rights and powers specifically granted to the Board of Directors of the Company or to the Company, or as may be necessary or advisable in the administration of this Agreement, including, without limitation, the right and power to (i) interpret the provisions of this Agreement and (ii) make all determinations deemed necessary or advisable for the administration of this Agreement (including, without limitation, a determination to redeem or not redeem the Rights or to amend or not amend this Agreement). All such actions, calculations, interpretations and determinations that are done or made by the Board of Directors of the Company in good faith shall be final, conclusive and binding on the Company, the Rights Agent, the holders of the Rights, as such, and all other parties. The Rights Agent is entitled always to assume that the Board of Directors of the Company (or any committee thereof) acted in good faith and shall be fully protected and incur no liability in reliance thereon. Section 31. Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, null and void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated;provided, that if any such excluded terms, provisions, covenants or restrictions shall affect the rights, immunities, liabilities, duties, responsibilities or obligations of the Rights Agent, the Rights Agent shall, in its sole discretion, be entitled to resign immediately. Section 32. Governing Law; Waiver of Jury Trial. This Agreement and each Right Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to contracts to be made and performed entirely within such State;provided,however, that all provisions regarding the Rights Agent's rights, immunities, liabilities, duties, responsibilities or obligations hereunder ("Rights Agent Matters") shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed entirely within such state. The parties agree that actions or proceedings arising out of this Agreement shall be brought in the U.S. District Court for the District of Delaware or the Court of Chancery of the State ofEXH-A-32Delaware and that, in connection with any such action or proceeding, the parties shall submit to the jurisdiction of, and venue in, such courts. Each of the parties hereto also irrevocably waives all right to trial by jury in any action, proceeding or counterclaim arising out of this Agreement. Section 33. Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. Delivery of an executed signature page of Agreement by facsimile or other customary means of electronic transmission (e.g., "pdf") shall be have the same authority, effect and enforceability as an original signature. Section 34. Descriptive Headings. Descriptive headings of the several Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof. Section 35. Force Majeure. Notwithstanding anything to the contrary contained herein, the Rights Agent shall not be liable for any delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, terrorist acts, shortage of supply, breakdowns or malfunctions, interruptions or malfunctions of computer facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties, war or civil unrest.EXH-A-33 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, all as of the day and year first above written.THERAVANCE BIOPHARMA, INC.By:/s/Name:Title:Chief Executive Officer[COMPUTERSHARE TRUST COMPANY, N.A.]as Rights AgentBy:/s/Name:Title:Signature Page to Rights AgreementEXH-A-34 Amended and Restated Memorandum and Articles of AssociationEXH-A-35Certificate No. R-NOT EXERCISABLE AFTER[ ] [ ], 20[ ] OR EARLIER IF REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.01 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE THEREOF[OR ANY OTHER PERSON WHO ACTS IN CONCERT WITH SUCH ACQUIRING PERSON (OR ANY AFFILIATE OF ASSOCIATE THEREOF)](AS THOSE TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN TRANSFEREES THEREOF WILL BECOME NULL AND VOID AND WILL NO LONGER BE TRANSFERABLE.RIGHT CERTIFICATETHERAVANCE BIOPHARMA, INC. This certifies that or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles the owner thereof, subject to the terms, provisions and conditions of the Rights Agreement, dated as of[ ] [ ], 20[ ] as the same may be amended, restated, renewed or extended from time to time (the "Rights Agreement"), between Theravance Biopharma, Inc., a Cayman Islands exempted company (the "Company"), and[Computershare Trust Company, N.A., a federally chartered trust company] (the "Rights Agent") as Rights Agent, to purchase from the Company at any time after the Distribution Date (as such term is defined in the Rights Agreement) and prior to 5:00 P.M., New York City time, on[ ] [ ], 20[ ] at the office(s) or agency(ies) of the Rights Agent designated for such purpose, or of its successor as Rights Agent, one one-thousandth of a fully paid non-assessable share of Series A Junior Participating Preferred Share, par value $0.00001 per share (the "Preferred Share"), of the Company at a purchase price of $[ ] per one one-thousandth of a Preferred Share (the "Purchase Price"), upon presentation and surrender of this Right Certificate with the Form of Election to Purchase duly executed. The number of Rights evidenced by this Rights Certificate (and the number of one one-thousandths of a Preferred Share which may be purchased upon exercise hereof) set forth above, and the Purchase Price set forth above, are the number and Purchase Price as of[ ] [ ], 20[ ], based on the Preferred Shares as constituted at such date. As provided in the Rights Agreement, the Purchase Price, the number of one one-thousandths of a Preferred Share (or other securities or property) which may be purchased upon the exercise of the Rights and the number of Rights evidenced by this Right Certificate are subject to modification and adjustment upon the happening of certain events. This Right Certificate is subject to all of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and conditions are hereby incorporated herein by reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of the Right Certificates. Copies of the Rights Agreement are on file at the principal executive offices of the Company and the office of the Rights Agent designated for such purpose. The Company will mail to the holder of this Right Certificate a copy of the Rights Agreement without charge after receipt of a written request therefor. This Right Certificate, with or without other Right Certificates, upon surrender at the office(s) or agency(ies) of the Rights Agent designated for such purpose, may be exchanged for another Right Certificate or Right Certificates of like tenor and date evidencing Rights entitling the holder topurchase a like aggregate number of Preferred Shares as the Rights evidenced by the Right Certificate or Right Certificates surrendered shall have entitled such holder to purchase. If this Right Certificate shall be exercised in part, the holder shall be entitled to receive upon surrender hereof another Right Certificate or Right Certificates for the number of whole Rights not exercised. Subject to the provisions of the Rights Agreement, the Rights evidenced by this Certificate (i) may be redeemed by the Company at a redemption price of $.01 per Right or (ii) may be exchanged in whole or in part for shares of the Company's Ordinary Shares, par value $0.01 per share, or Preferred Shares. No fractional Preferred Shares or Ordinary Shares will be issued upon the exercise or exchange of any Right or Rights evidenced hereby (other than fractions of a Preferred Share which are integral multiples of one one-thousandth of a Preferred Share, which may, at the election of the Company, be evidenced by depository receipts), but in lieu thereof a cash payment will be made, as provided in the Rights Agreement. No holder of this Right Certificate, as such, shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the Preferred Share or of any other securities of the Company which may at any time be issuable on the exercise or exchange hereof, nor shall anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a shareholder of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as provided in the Rights Agreement) or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by this Right Certificate shall have been exercised or exchanged as provided in the Rights Agreement. This Right Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by the Rights Agent. WITNESS the facsimile signature of the proper officers of the Company and its corporate seal. Dated as of , 20 .THERAVANCE BIOPHARMA, INC.By:Name:Title:ATTEST:Name:,Title:Countersigned:[COMPUTERSHARE TRUST COMPANY, N.A.]as Rights AgentBy:Form of Reverse Side of Right CertificateFORM OF ASSIGNMENT(To be executed by the registered holder if suchholder desires to transfer the Right Certificate)FOR VALUE RECEIVEDhereby sells, assigns and transfers unto(Please print name and address of transferee) Rights represented by this Right Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint Attorney, to transfer said Rights on the books of the within-named Company, with full power of substitution.Dated:SignatureSignature Guaranteed: Signatures must be guaranteed by a bank, trust company, broker, dealer or other eligible institution participating in a recognized signature guarantee medallion program at a guarantee level satisfactory to the Rights Agent. A notary public is not sufficient.(To be completed) The undersigned hereby certifies that the Rights evidenced by this Right Certificate are not beneficially owned by, were not acquired by the undersigned from, and are not being assigned to an Acquiring Person or an Affiliate or Associate thereof[or Person Acting in Concert therewith (or any Affiliate or Associate thereof] (as defined in the Rights Agreement).SignatureForm of Reverse Side of Right Certificate-ContinuedFORM OF ELECTION TO PURCHASE(To be executed if holder desires to exerciseRights represented by the Rights Certificate)To THERAVANCE BIOPHARMA, INC.: The undersigned hereby irrevocably elects to exercise Rights represented by this Right Certificate to purchase the Preferred Shares (or other securities or property) issuable upon the exercise of such Rights and requests that certificates for such Preferred Shares (or such other securities) be issued in the name of:(Please print name and address) If such number of Rights shall not be all the Rights evidenced by this Right Certificate, a new Right Certificate for the balance remaining of such Rights shall be registered in the name of and delivered to:Please insert social securityor other identifying number(Please print name and address)Dated:SignatureSignature Guaranteed: Signatures must be guaranteed by a bank, trust company, broker, dealer or other eligible institution participating in a recognized signature guarantee medallion program at a guarantee level satisfactory to the Rights Agent. A notary public is not sufficient.Form of Reverse Side of Right Certificate-Continued(To be completed) The undersigned certifies that the Rights evidenced by this Right Certificate are not beneficially owned by, and were not acquired by the undersigned from, an Acquiring Person or an Affiliate or Associate thereof[or Person Acting in Concert therewith (or any Affiliate or Associate thereof)] (as defined in the Rights Agreement).Signature The signature in the Form of Assignment or Form of Election to Purchase, as the case may be, must conform to the name as written upon the face of this Right Certificate in every particular, without alteration or enlargement or any change whatsoever. In the event the certification set forth above in the Form of Assignment or the Form of Election to Purchase, as the case may be, is not completed, such Assignment or Election to Purchase will not be honored. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE THEREOF[OR PERSON ACTING IN CONCERT THEREWITH (OR AFFILIATE OR ASSOCIATE THEREOF)] (AS THOSE TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN TRANSFEREES THEREOF WILL BECOME NULL AND VOID AND WILL NO LONGER BE TRANSFERABLE.SUMMARY OF RIGHTS TO PURCHASEPREFERRED SHARES OFTHERAVANCE BIOPHARMA, INC. On[ ] [ ], 20[ ] the Board of Directors of Theravance Biopharma, Inc., a Cayman Islands exempted company, (the "Company") authorized and granted to the shareholders of the Company one preferred share purchase right (a "Right") for each issued and outstanding Ordinary Share, par value $0.00001 per share, of the Company (the "Ordinary Shares"). The grant was effected on[ ] [ ], 20[ ] (the "Record Date") to the shareholders of record on that date. Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Share, par value $0.00001 per share, of the Company (the "Preferred Share") at a price of $[] per one one-thousandth of a Preferred Share (the "Purchase Price"), subject to adjustment. The description and terms of the Rights are set forth in a Rights Agreement dated as of[ ] [ ], 20[ ], as the same may be amended from time to time (the "Rights Agreement"), between the Company and [Computershare Trust Company, N.A., a federally chartered trust company (the "Rights Agent"), as Rights Agent. Until the earlier to occur of (i) 10 days following a public announcement that a person or group of affiliated or associated persons (with certain exceptions, an "Acquiring Person") has acquired beneficial ownership of 19.9% or more of the issued and outstanding Ordinary Shares or (ii) 10 business days (or such later date as may be determined by action of the Board of Directors prior to such time as any person or group of affiliated persons becomes an Acquiring Person) following the commencement of, or announcement of an intention to make, a tender offer or exchange offer the consummation of which would result in the beneficial ownership by a person or group of 19.9% or more of the issued and outstanding Ordinary Shares (the earlier of such dates being called the "Distribution Date"), the Rights will be evidenced, with respect to any of the Ordinary Shares certificates issued and outstanding as of the Record Date, by such Ordinary Shares certificate together with this Summary of Rights. The Rights Agreement provides that, until the Distribution Date (or earlier expiration of the Rights), the Rights will be transferred with and only with the Ordinary Shares. Until the Distribution Date (or earlier expiration of the Rights), new Ordinary Shares certificates issued after the Record Date upon transfer or new issuances of Ordinary Shares will contain a notation incorporating the Rights Agreement by reference. Until the Distribution Date (or earlier expiration of the Rights), the surrender for transfer of any certificates (if any) for Ordinary Shares, issued and outstanding as of the Record Date, even without such notation or a copy of this Summary of Rights, will also constitute the transfer of the Rights associated with the Ordinary Shares represented by such certificate. As soon as practicable following the Distribution Date, separate certificates evidencing the Rights ("Right Certificates") will be mailed to holders of record of the Ordinary Shares as of the close of business on the Distribution Date and such separate Right Certificates alone will evidence the Rights. The Rights are not exercisable until the Distribution Date. The Rights will expire on[ ] [ ], 20[ ] (the "Final Expiration Date"), unless the Final Expiration Date is advanced or extended or unless the Rights are earlier redeemed or exchanged by the Company, in each case as described below. The Purchase Price payable, and the number of Preferred Shares or other securities or property issuable, upon exercise of the Rights is subject to adjustment from time to time to prevent dilution (i) in the event of a share dividend on, or a subdivision, combination or reclassification of, the Preferred Share, (ii) upon the grant to holders of the Preferred Shares of certain rights or warrants to subscribe for or purchase Preferred Shares at a price, or securities convertible into Preferred Shares with a conversion price, less than the then-current market price of the Preferred Shares or (iii) upon the distribution to holders of the Preferred Shares of evidences of indebtedness or assets (excluding regular periodic cash dividends or dividends payable in Preferred Shares) or of subscription rights or warrants (other than those referred to above). The number of issued and outstanding Rights is subject to adjustment in the event of a share dividend on the Ordinary Shares payable in Ordinary Shares or subdivisions, consolidations or combinations of the Ordinary Shares occurring, in any such case, prior to the Distribution Date. Preferred Shares purchasable upon exercise of the Rights will not be redeemable. Each Preferred Share will be entitled, when, as and if declared, to a minimum preferential quarterly dividend payment of the greater of (a) $1.00 per share, and (b) an amount equal to 1,000 times the dividend declared per Ordinary Share. In the event of liquidation, dissolution or winding up of the Company, the holders of the Preferred Shares will be entitled to a minimum preferential payment of the greater of (a) $10.00 per share (plus any accrued but unpaid dividends), and (b) an amount equal to 1,000 times the payment made per Ordinary Share. Each Preferred Share will have 1,000 votes, voting together with the Ordinary Shares. Finally, in the event of any merger, consolidation or other transaction in which issued and outstanding Ordinary Shares are converted or exchanged, each Preferred Share will be entitled to receive 1,000 times the amount received per Ordinary Share. These rights are protected by customary anti-dilution provisions. Because of the nature of the Preferred Share's dividend, liquidation and voting rights, the value of the one one-thousandth interest in a Preferred Share purchasable upon exercise of each Right should approximate the value of one Ordinary Share. In the event that any person or group of affiliated or associated persons becomes an Acquiring Person, each holder of a Right, other than Rights beneficially owned by the Acquiring Person (which will thereupon become null and void), will thereafter have the right to receive upon exercise of a Right that number of Ordinary Shares having a market value of two times the exercise price of the Right. In the event that, after a person or group has become an Acquiring Person, the Company is acquired in a merger or other business combination transaction or 50% or more of its consolidated assets or earning power are sold, proper provisions will be made so that each holder of a Right (other than Rights beneficially owned by an Acquiring Person which will have become null and void) will thereafter have the right to receive upon the exercise of a Right that number of Ordinary Shares of the person with whom the Company has engaged in the foregoing transaction (or its parent) that at the time of such transaction have a market value of two times the exercise price of the Right. At any time after any person or group becomes an Acquiring Person and prior to the earlier of one of the events described in the previous paragraph or the acquisition by such Acquiring Person of 50% or more of the issued and outstanding Ordinary Shares, the Board of Directors of the Company may exchange the Rights (other than Rights owned by such Acquiring Person which will have become null and void), in whole or in part, for Ordinary Shares or Preferred Shares (or a series of the Company's preferred shares having equivalent rights, preferences and privileges), at an exchange ratio of one Ordinary Share, or a fractional Preferred Share (or other preferred shares) equivalent in value thereto, per Right. With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in such Purchase Price. No fractional PreferredShares or Ordinary Shares will be issued (other than fractions of Preferred Shares which are integral multiples of one one-thousandth of a Preferred Share, which may, at the election of the Company, be evidenced by depositary receipts), and in lieu thereof an adjustment in cash will be made based on the current market price of the Preferred Shares or the Ordinary Shares. At any time prior to the time an Acquiring Person becomes such, the Board of Directors of the Company may redeem the Rights in whole, but not in part, at a price of $.01 per Right (the "Redemption Price") payable, at the option of the Company, in cash, Ordinary Shares or such other form of consideration as the Board of Directors of the Company shall determine. The redemption of the Rights may be made effective at such time, on such basis and with such conditions as the Board of Directors in its sole discretion may establish. Immediately upon any redemption of the Rights, the right to exercise the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price. For so long as the Rights are then redeemable, the Company may, except with respect to the Redemption Price, amend the Rights Agreement in any manner. After the Rights are no longer redeemable, the Company may, except with respect to the Redemption Price, amend the Rights Agreement in any manner that does not adversely affect the interests of holders of the Rights. Until a Right is exercised or exchanged, the holder thereof, as such, will have no rights as a shareholder of the Company, including, without limitation, the right to vote or to receive dividends. A copy of the form of Rights Agreement has been filed with the Securities and Exchange Commission as an Exhibit to the Company's[ ] dated [ ][ ], 20[ ]. A copy of the Rights Agreement is available free of charge from the Company. This summary description of the Rights does not purport to be complete and is qualified in its entirety by reference to the Rights Agreement, as the same may be amended from time to time, which is hereby incorporated herein by reference..of Shareholders – May 1, 2018THIS PROXY IS SOLICITEDProxy Card 1234 5678 9012 345 IF VOTING BY THE BOARD OF DIRECTORS OF THE COMPANYThe undersigned hereby appoints Rick E Winningham and Renee D. Gala, and each of them, with power to act without the other and with powerof substitution, as proxies and attorneys-in-fact and hereby authorizes them to represent and vote, as provided on the other side, all the Ordinary Shares ofTheravance Biopharma, Inc. which the undersigned is entitled to vote, and, in their discretion, to vote upon such other business as may properly come beforethe Annual General Meeting of Shareholders of the company to be held May 1, 2018 or at any adjournment or postponement thereof, with all powers whichthe undersigned would possess if present at the Meeting.(Continued and to be marked, dated and signed, on the other side)Proxy — THERAVANCE BIOPHARMA, INC.Important notice regarding the Internet availability of proxy materials for the Annual General Meeting of Shareholders. The Proxy Statement and the2017 Annual Report on Form 10-K are available at: http://investor.theravance.com/proxyqIF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION,MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.q
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. Important notice regarding the Internet availability of proxy materials for the Annual General Meeting of Shareholders. The Proxy Statement and the 20172020 Annual Report on Form 10-K are available at: http://investor.theravance.com/proxy.cfmproxy. q IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION,VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q Proxy — THERAVANCE BIOPHARMA, INC. + Annual General Meeting of Shareholders – May 1, 2018— April 27, 2021 THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY The undersigned hereby appoints Rick E Winningham and Renee D. Gala,Andrew A. Hindman, and each of them, with power to act without the other and with power of substitution, as proxies and attorneys-in-fact and hereby authorizes them to represent and vote, as provided on the other side, all the Ordinary Shares of Theravance Biopharma, Inc. which the undersigned is entitled to vote, and, in their discretion, to vote upon such other business as may properly come before the Annual General Meeting of Shareholders of the company to be held May 1, 2018April 27, 2021 or at any adjournment or postponement thereof, with all powers which the undersigned would possess if present at the Meeting. (Continued and to be marked, dated and signed, on the other side) C Non-Voting Items Change of Address — Please print new address below. Comments — Please print your comments below. +