Date 1 September 2009 1 Parties 1 Background 1 Operative provisions 2 Conditions precedent to implementation of the Option Scheme 3 Reasonable endeavours 3 Waiver of conditions 3 Failure of condition 3 Notice of changes 4 Share Scheme 4 Share Scheme...

Exhibit 2.1

Amended and Restated

Merger Implementation Agreement

Unilife Medical Solutions Limited

Unilife Corporation

Table of contents

Date 1 September 2009			1
Parties			1
Background			1
Operative provisions			2
1 Implementation of the Proposed Transaction			2
2 Conditions			2
Conditions precedent to implementation of the Option Scheme			3
Reasonable endeavours			3
Waiver of conditions			3
Failure of condition			3
Notice of changes			4
3 Share Scheme			4
Share Scheme			4
Share Scheme Consideration			4
Election			4
Fractional entitlements			4
Ineligible Overseas Shareholders			4
General provisions			5
4 Option Scheme			5
Preliminary steps			5
Option Scheme			5
Option Scheme Consideration			5
Terms of Unilife Corporation Options			5
Fractional entitlements			5
General provisions			5
5 Co-operation			6
6 Implementation of Schemes			6
Preliminary steps			6
The Company’s obligations			6
Unilife Corporation obligations			7
7 Replacement of Non-ESOP Options			8
Cancellation of Non-ESOP Options and offer of Unilife Corporation Non-ESOP Options			8
Terms of Unilife Corporation Non-ESOP Options			8
8 Conversion of Company to a proprietary company			8
9 Termination			8
Termination by notice			8
Automatic termination			8
Mutual termination			8
Effect of termination			9
10 Public announcements and disclosure			9
Public announcements			9
Required disclosure			9
11 Buy back of shares in Unilife Corporation			9
12 Costs and stamp duty			9
13 Miscellaneous			9
Notices			9
No waiver			10
Remedies cumulative			10
Entire agreement			10
Amendment			10
Assignment			10
Consents or approvals			10
No merger			10
Further assurances			10
Severability of provisions			10
Counterparts			10
GST			11

14 Governing law and jurisdiction			11
15 Definitions and interpretations			11
Definitions			11
Interpretation			13
Construction			14
Payments			14
Execution and date			15

Date 1 September 2009

Parties

Unilife Medical Solutions Limited ABN 14 000 000 000 of Xxxxx 00, 0 Xxxxxxx Xxxxxx, Xxxxxx, XXX, Xxxxxxxxx 0000 (Company)

Unilife Corporation a company incorporated in Delaware, United States of America, of 000 Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000, Xxxxxx Xxxxxx of America (Unilife Corporation)

Background

A The Parties have agreed that the Company will seek to implement a transaction in order to redomicile the Unilife group in the United States of America pursuant to which:

(a) Unilife Corporation will acquire all of the issued Shares of the Company in exchange for the issue of Unilife Corporation Shares or CDIs to shareholders of the Company by means of a scheme of arrangement under Part 5.1 of the Corporations Act (Share Scheme); and

(b) the existing Options issued under the Company’s Employee Share Option Plan will be cancelled in exchange for the issue of Unilife Corporation Options in Unilife Corporation to existing holders of Options in the Company by means of a scheme of arrangement under Part 5.1 of the Corporations Act (Option Scheme).

B		As a result of the Proposed Transaction, the Company will become a wholly-owned subsidiary of Unilife Corporation.
C		The Board unanimously considers that the proposed Schemes are in the best interests of Shareholders and Optionholders.
D		The Parties will implement the Schemes in good faith on the terms and conditions of this Agreement.
E		In conjunction with the Schemes, the Parties will seek to replace the existing options issued to certain consultants and advisers and other third parties outside the ESOP (Non-ESOP Options) with new options in Unilife Corporation.
F		Following the implementation of the Schemes, Unilife Corporation will:

(a) buy back the Unilife Corporation Shares issued to the Company on incorporation of Unilife Corporation for a nominal consideration of US$1.00; and

(b) convert the Company from a public company to a proprietary company limited by shares.

Operative provisions

1 Implementation of the Proposed Transaction

1.1 The Company will propose and the Parties will seek to implement the Proposed Transaction in accordance with this Agreement.

1.2 Unilife Corporation will comply with its obligations under the Proposed Transaction and provide reasonable assistance to the Company in proposing and implementing the Proposed Transaction in accordance with this Agreement.

2 Conditions

Conditions precedent to implementation of the Share Scheme

2.1 The transfer of the Scheme Shares and Unilife Corporation’s obligations under clause 3.2 are subject to each of the following conditions being satisfied or waived in accordance with this clause 2:

2.1.1 (No prohibitive orders): Prior to 8.00am on the Second Court Hearing Date, no judicial authority or entity and no Government Agency taking and not withdrawing any action, or imposing any legal restraint or prohibition, to prevent the implementation of the Proposed Transaction (or any transaction contemplated by the Proposed Transaction).

	2.1.2		(Regulatory Consents): All approvals, consents or waivers which the Parties agree are required to implement the transactions envisaged by this Agreement (other than the approval by the Court of the Schemes under section 411(4)(b) of the Corporations Act) having been obtained or deemed to have been obtained by 5:00pm on the Business Day immediately prior to the Second Court Hearing Date including ASIC and ASX providing all consents, approvals and waivers and doing all other acts which are necessary or reasonably desirable to implement the Proposed Transaction on terms that are unconditional or subject only to conditions which are acceptable to the Company (Regulatory Consents).
	2.1.3		(ASX listing): ASX approving:

	(a)		Unilife Corporation for admission to the official list of ASX; and
	(b)		the CDIs for official quotation by ASX, in each case conditional only on the Share Scheme becoming Effective and Unilife Corporation providing the information required by the ASX approval or by the Listing Rules and satisfying any conditions in the ASX approval with regard to deferred settlement trading of the CDIs.

2.1.4 (Shareholder approval): Shareholders approving the Share Scheme at the Share Scheme Meeting (or any adjournment or postponement of it at which the Share Scheme is voted on) by the requisite majorities under the Corporations Act.

2.1.5 (Court approval of Share Scheme): The Court approving the Share Scheme in accordance with section 411(4)(b) of the Corporations Act either unconditionally or on conditions that are customary or usual.

2.1.6 (Depositary): Before 5.00pm on the Business Day prior to the Second Court Hearing Date, Unilife Corporation has appointed a Depositary and the Depositary has agreed to the allotment to it of Unilife Corporation Shares under the Share Scheme.

2.1.7 (Nominee): Before 5.00pm on the Business Day prior to the Second Court Hearing Date, Unilife Corporation has appointed a Nominee and the Nominee has agreed to sell the CDIs as contemplated by clause 3.7.

2.1.8 (Ability to issue CDIs): Before 5.00pm on the Business Day prior to the Second Court Hearing Date, Unilife Corporation has done everything necessary under the ASTC Settlement Rules to enable it to issue CDIs other than the allotment to a Depositary of Unilife Corporation Shares under the Share Scheme.

2.1.9 (Independent Expert): The Independent Expert giving a report to the Company that in its opinion the Proposed Transaction is fair and reasonable and in the best interests of Shareholders and Optionholders and the Independent Expert does not change its conclusion or withdraw its report prior to 5.00pm on the day prior to the Second Court Hearing Date.

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Conditions precedent to implementation of the Option Scheme

2.2 The cancellation of the Options and Unilife Corporation’s obligations under clause 4.3 are subject to the satisfaction or waiver of each of the conditions set out in clause 2.1 and each of the following conditions being satisfied or waived in accordance with this clause 2:

2.2.1 (Optionholder approval): Optionholders approving the Option Scheme at the Option Scheme Meeting (or any adjournment or postponement of it at which the Option Scheme is voted on) by the requisite majorities under the Corporations Act.

2.2.2 (Court approval of Option Scheme): The Court approving the Option Scheme in accordance with section 411(4)(b) of the Corporations Act either unconditionally or on conditions that are customary or usual.

Reasonable endeavours

2.3 Each of the Parties must use its reasonable endeavours to procure that:

2.3.1 each of the conditions in clauses 2.1 and 2.2 are satisfied as expeditiously as possible and in any event on or before the Sunset Date, including providing all reasonable assistance to the other Party as is necessary to satisfy such conditions; and

2.3.2 there is no occurrence within the control of the Company or Unilife Corporation (as the context requires) which would prevent the conditions in clause 2.1 or 2.2 from being satisfied.

2.4 Without limiting clause 2.3.1, the Company and Unilife Corporation (as the case requires) must for the purpose of fulfilling their obligations under clause 2.3:

2.4.1 promptly apply for all relevant Regulatory Consents and provide the other with a copy of all those applications;

	2.4.2		take all steps for which it is responsible as part of the approval process;
	2.4.3		respond to requests for information at the earliest practicable time;

2.4.4 provide the other with all information reasonably requested in connection with the applications for Regulatory Consents; and

2.4.5 so far as it is able, allow the other and its representatives the opportunity to be present at any meetings with any Government Agency.

2.5 Each of the Company and Unilife Corporation must promptly notify the other after it becomes aware that any condition in clause 2.1 or 2.2 has been satisfied or has become incapable of being satisfied.

Waiver of conditions

2.6 The conditions in clause 2.1.1, 2.1.2, 2.1.3, 2.1.6, 2.1.7 and 2.1.8 are for the joint benefit of the Company and Unilife Corporation and may only be waived jointly by them.

2.7		The condition in clause 2.1.9 is for the sole benefit of the Company and may only be waived by the Company.
2.8		The conditions in clauses 2.1.4, 2.1.5, 2.2.1 and 2.2.2 cannot be waived.

2.9 Any waiver of the conditions in clause 2.1 (that are capable of waiver) must take place prior to 8.00am on the Second Court Hearing Date to be effective.

Failure of condition

2.10 If:

2.10.1 a condition in clause 2.1 or 2.2 is not satisfied or waived (where it is capable of being waived) by the date specified for its satisfaction; or

2.10.2 a condition in clause 2.1 or 2.2 becomes incapable of being satisfied by the date specified for its satisfaction and is not waived (where it is capable of being waived), then unless the condition is waived (where it is capable of being waived), the Parties must consult in good faith to:

2.10.3 determine whether the Proposed Transaction or an element of the Proposed Transaction (as relevant) may proceed by way of alternative means or methods;

	2.10.4		change the date of the application made to the Court for an order under section 411(4)(b) of the Corporations Act approving the Schemes or adjourning that application (as applicable) to another date agreed by the Company and Unilife Corporation (being a date no later than five Business Days before the Sunset Date); or
	2.10.5		extend the relevant date or Sunset Date.

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2.11 If the Parties are unable to reach agreement under clause 2.10 within five Business Days of the date on which they both become aware that the condition has become incapable of being satisfied (or, if earlier, by 8.00am on the Second Court Hearing Date), then unless the condition is waived (where it is capable of being waived), the Party entitled to the benefit of that condition may terminate this Agreement at any time prior to 8.00am on the Second Court Hearing Date with immediate effect by written notice to the other Party.

2.12 Subject to the rights of the Parties under clauses 9.4, 9.5, 10, 12 and 13 of this Agreement, following any termination under clause 2.11, no Party will have any liability to the other Party in respect of this Agreement.

Notice of changes

2.13 The Company and Unilife Corporation must promptly notify each other of any change or event causing, or which, so far as can reasonably be foreseen, would cause:

2.13.1 any of the conditions in clauses 2.1 or 2.2 being satisfied or becoming incapable of satisfaction; or

2.13.2 a material breach of this Agreement.

3 Share Scheme

Share Scheme

3.1 The Company will propose a scheme of arrangement under which all the Scheme Shares are transferred to Unilife Corporation and Scheme Shareholders will be entitled to receive the Share Scheme Consideration.

Share Scheme Consideration

3.2 In consideration of the Scheme Shareholders transferring their Shares to Unilife Corporation on the Implementation Date, Unilife Corporation covenants in the Company’s favour (in its own right and separately as trustee or nominee for each Scheme Shareholder) that Unilife Corporation will, on the Implementation Date, and immediately before the transfer of the Shares to Unilife Corporation, issue to such Scheme Shareholder (or, in accordance with clause 3.7 to a Nominee on its behalf where such Scheme Shareholder is an Ineligible Overseas Shareholder):

3.2.1 one Unilife Corporation Share for every six Shares held by the Scheme Shareholder on the Scheme Record Date, where such Scheme Shareholder has made an election to receive Unilife Corporation Shares in accordance with clause 3.3; or

3.2.2 six CDIs for every Unilife Corporation Share to which the Scheme Shareholder would be entitled under clause 3.2.1, where the Scheme Shareholder has made an election to receive CDIs or has not made an election in accordance with clause 3.3.

Election

3.3 The Information Memorandum must be accompanied by written notice to the Company’s share registry, under which each Scheme Shareholder may make an election to receive Unilife Corporation Shares or CDIs under the Share Scheme, by completing, signing and returning the written notice by 5.00pm on the Scheme Record Date (or such other date as agreed by the Parties in writing) to the Company’s share registry.

3.4 An election under clause 3.3 may only be made in respect of all and not only some of the Shares held by a Scheme Shareholder.

3.5 If a Scheme Shareholder does not make an election in accordance with clause 3.3, a Scheme Shareholder will receive CDIs under the Share Scheme.

Fractional entitlements

3.6 Fractional entitlements to Share Scheme Consideration will be rounded down to the nearest:

3.6.1 whole number of Unilife Corporation Shares, if the Scheme Shareholder has elected to receive Unilife Corporation Shares under the Share Scheme; or

3.6.2 multiple of six CDIs, if the Scheme Shareholder has elected to receive CDIs or has not made an election under clause 3.3, after aggregating all holdings of such Scheme Shareholder.

Ineligible Overseas Shareholders

3.7 Where a Scheme Shareholder is an Ineligible Overseas Shareholder, the number of CDIs to which the Scheme Shareholder would otherwise be entitled under the ShareScheme will be issued to a Nominee of Unilife Corporation who will sell those CDIs as soon as reasonably practicable (at the risk of that Ineligible Overseas Shareholder) and pay the net proceeds received in Australian dollars (calculated on an averaged basis so that all Ineligible Overseas Shareholders receive the same price per CDI subject to rounding to the nearest cent), after deducting any applicable brokerage and other taxes and charges, to that Ineligible Overseas Shareholder in full satisfaction of that Ineligible Overseas Shareholder’s rights to Share Scheme Consideration.

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General provisions

3.8 The obligations of Unilife Corporation to issue Unilife Corporation Shares under this Agreement will be satisfied by Unilife Corporation on the Implementation Date procuring the entry in the register maintained by Unilife Corporation of holders of Unilife Corporation Shares of each person who is to receive Unilife Corporation Shares.

3.9 After the satisfaction of the obligations of Unilife Corporation in clause 3.8, and within five Business Days after the Implementation Date, Unilife Corporation will:

3.9.1 issue holding statements, certificates or transmittal letters (as the case may be) for such Unilife Corporation Shares in the name of such persons; and

3.9.2 procure the despatch of such holding statements, certificates or transmittal letters to the address as shown in the register for such persons.

3.10 The obligations of Unilife Corporation to issue CDIs under clause 3.2 will be satisfied by Unilife Corporation on the Implementation Date procuring the entry in the register maintained by Unilife Corporation of holders of Unilife Corporation Shares of the Depositary as depositary to hold the Unilife Corporation Shares underlying those CDIs and procuring the Despositary to issue CDIs to Scheme Shareholders in accordance with the Share Scheme.

3.11 After the satisfaction of the obligations of Unilife Corporation in clause 3.10, and within five Business Days after the Implementation Date, Unilife Corporation will:

3.11.1 issue holding statements or transmittal letters (as the case may be) for such Unilife Corporation Shares in the name of the Depositary and procure the despatch of such holding statements or transmittal letters to the Depositary;

3.11.2 record in the CDI Register each person who is to receive CDIs under clause 3.2; and

3.11.3 despatch to each person who is to receive CDIs under clause 3.2 a holding statement in the name of that person representing the number of CDIs to be issued to that person.

4 Option Scheme

Preliminary steps

4.1 On or before 8.00am on the Second Court Hearing Date, Unilife Corporation will adopt the Unilife Corporation Employee Stock Option Plan.

Option Scheme

4.2 The Company will propose a scheme of arrangement under which all of the Options are cancelled and Scheme Optionholders will be entitled to receive the Option Scheme Consideration.

Option Scheme Consideration

4.3 In consideration of the Scheme Optionholders agreeing to cancel their Options on the Implementation Date, Unilife Corporation covenants in the Company’s favour (in its own right and separately as trustee or nominee for each Scheme Optionholder) that Unilife Corporation will, on the Implementation Date, and immediately before the cancellation of the Options, issue to such Scheme Optionholder one Unilife Corporation Option for every six Options held by them on the Scheme Record Date.

Terms of Unilife Corporation Options

4.4 Each Unilife Corporation Option issued in accordance with clause 4.3 will:

4.4.1 have an exercise price per Unilife Corporation Option equal to six times the exercise price per option of the relevant Options it replaces;

4.4.2 have an exercise period equal to the unexpired exercise period of the relevant Options it replaces;

4.4.3 be vested to the same extent and have the same terms as to vesting as the relevant Options it replaces; and

4.4.4 otherwise be issued on the terms of the Unilife Corporation Employee Stock Option Plan.

Fractional entitlements

4.5 Fractional entitlements to Option Scheme Consideration will be rounded down to the nearest whole number of Unilife Corporation Options after aggregating all holdings of such Scheme Optionholder.

General provisions

4.6 The obligation of Unilife Corporation to issue Unilife Corporation Options under this Agreement will be satisfied by Unilife Corporation on the Implementation Date procuring the entry in the register maintained by Unilife Corporation of optionholders of each person who is to receive Unilife Corporation Options.

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4.7 After the satisfaction of the obligations of Unilife Corporation in clause 4.6, and within five Business Days after the Implementation Date, Unilife Corporation will:

4.7.1 issue certificates for such Unilife Corporation Options in the name of such persons; and

4.7.2 procure the despatch of such certificates to the address as shown in the option register for such persons.

5 Co-operation

5.1 Unilife Corporation and the Company must each use all reasonable endeavours to produce the Information Memorandum, seek the required Regulatory Consents and implement the Schemes as soon as reasonably practicable.

5.2		The Company and Unilife Corporation will for this purpose discuss the content of drafts of the Information Memorandum and the Company will consider all requests or suggestions by Unilife Corporation as to the content of the Information Memorandum.
6		Implementation of Schemes

Preliminary steps

6.1 On or before 8.00am on the Second Court Hearing Date:

6.1.1 the Company will make an offer to each holder of Non-ESOP Options to cancel the Non-ESOP Options held by that person in accordance with clause 7; and

6.1.2 the Company will apply for a ruling from the Australian Taxation Office that Australian resident Scheme Shareholders and Scheme Optionholders will receive capital gains tax rollover relief in relation to the transfer of their Shares to Unilife Corporation under the Share Scheme and the cancellation and replacement of their Options under the Option Scheme and for the Non-ESOP Optionholders in relation to the cancellation and replacement of their Non-ESOP Options in accordance with clause 7.

The Company’s obligations

6.2 The Company must take all necessary steps to propose, implement and complete the Schemes as soon as reasonably practicable. This includes taking each of the following steps:

6.2.1 (Prepare Information Memorandum): Prepare the Information Memorandum in accordance with all applicable laws including the Corporations Act, applicable ASIC Policy Statements and the Listing Rules. The Information Memorandum must include, amongst other things:

	(a)		details of the Schemes;
	(b)		the Deeds Poll;
	(c)		an explanatory statement complying with the requirements of the Corporations Act in respect of the Schemes as a whole;
	(d)		a report from the Independent Expert;
	(e)		notices of the Scheme Meetings;
	(f)		proxy forms for the Scheme Meetings; and
	(g)		a statement that each director of the Company recommends that Shareholders and Optionholders vote in favour of the Schemes.

6.2.2 (Consultation): Consult with Unilife Corporation and give Unilife Corporation and its representatives a reasonable opportunity to provide input about the Information Memorandum’s content and presentation.

6.2.3 (Independent Expert): Appoint an independent expert to provide a report with respect to the Schemes to be included in the Information Memorandum in accordance with all applicable laws.

6.2.4 (Registration): Request ASIC to register the explanatory statement included in the Information Memorandum in relation to the Schemes in accordance with section 412(6) of the Corporations Act.

6.2.5 (Engage suitable counsel): Engage suitable counsel to represent the Company in all Court proceedings related to the Schemes.

6.2.6 (Section 411(17)(b) statement): Apply to ASIC for a statement under section 411(17)(b) of the Corporations Act that ASIC has no objection to the Schemes.

6.2.7 (Court direction): Apply to the Court for orders under section 411(1) of the Corporations Act directing the Company to convene the Scheme Meetings.

6.2.8 (Scheme Meetings): Convene and hold the Scheme Meetings in order to seek approval of the Schemes in accordance with the Court’s orders.

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6.2.9 (New information): Provide to Shareholders and Optionholders any further or new information that arises after the Despatch Date and prior to the Scheme Meetings that is necessary to ensure that the information contained in the Information Memorandum is not false, misleading or deceptive in any material respect.

6.2.10 (Court approval): Apply to the Court for orders approving the Schemes if they are approved by the requisite majorities of Shareholders and Optionholders respectively at the Scheme Meetings.

6.2.11 (Certificate): Provide the Court on the Second Court Hearing Date with a certificate confirming whether all of the conditions in clauses 2.1 and 2.2 have been satisfied or waived in accordance with the terms of this Agreement.

6.2.12 (Lodge copy of Court order): Lodge an office copy of the Court order approving the Schemes (if made) with ASIC no later than 5.00pm on the day after the orders are made.

6.2.13 (Registration): If the Share Scheme becomes Effective, enter in the Register all transfers of Scheme Shares to Unilife Corporation under the Share Scheme on the Implementation Date.

6.2.14 (Register information): Provide Unilife Corporation and its share registry with all information necessary, or reasonably requested, in order to assist Unilife Corporation to provide the Scheme Consideration.

Unilife Corporation obligations

6.3 Unilife Corporation must take all necessary steps to implement and complete the Schemes as soon as is reasonably practicable. This includes taking each of the following steps:

6.3.1 (Deeds Poll): Execute the Deeds Poll immediately following the Court making the orders under section 411(1) of the Corporations Act to convene the Scheme Meetings;

6.3.2 (Unilife Corporation information): Prepare and provide to the Company all information regarding Unilife Corporation required by all applicable laws, including the Corporations Act, applicable ASIC Policy Statements and the Listing Rules for inclusion in the Information Memorandum.

6.3.3 (Accuracy of Unilife Corporation information): Before the Despatch Date verify to the Company the accuracy of the Unilife Corporation information provided to the Company for inclusion in the Information Memorandum and consent to the inclusion of that information in the form and context in which it appears, in each case subject to Unilife Corporation being reasonably satisfied as to those matters.

6.3.4 (Certificate): Provide to the Court on the Second Court Hearing Date a certificate confirming whether all the conditions in clauses 2.1 and 2.2 have been satisfied or waived in accordance with the terms of this Agreement.

	6.3.5		(Unilife Corporation new information): Provide to the Company any further or new information about Unilife Corporation which arises after the Despatch Date and prior to the Scheme Meetings which is necessary or reasonably required by the Company to ensure that the information concerning Unilife Corporation that is disclosed in the Information Memorandum is not false, misleading or deceptive in any material respect.
	6.3.6		(Scheme Consideration): If the:

	(a)		Share Scheme becomes Effective, issue the Share Scheme Consideration in accordance with clause 3.2; and
	(b)		Option Scheme becomes Effective, issue the Option Scheme Consideration in accordance with clause 4.3;

			in each case on the Implementation Date.
	6.3.7		(Independent Expert): Promptly provide all assistance and information reasonably requested by the Independent Expert to enable it to prepare its report for inclusion in the Information Memorandum.

6.3.8 (Reasonable assistance): Provide any assistance or information reasonably requested by the Company in relation to the Schemes, including for the purposes of obtaining the Regulatory Consents.

6.3.9 (Unilife Corporation Employee Stock Option Plan): The Board of Directors and shareholders of Unilife Corporation must adopt the Unilife Corporation Employee Stock Option Plan prior to the Lodgement Date.

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Quotation of Company Shares

6.4 If the Share Scheme is approved by the Court, the Company must take all reasonable steps to ensure that the Shares remain quoted on ASX until the transfer of all the Scheme Shares to Unilife Corporation is completed.

7 Replacement of Non-ESOP Options

Cancellation of Non-ESOP Options and offer of Unilife Corporation Non-ESOP Options

7.1		On or before 8.00am on the Second Court Hearing Date, the Company will make an offer to each Non-ESOP Optionholder to cancel the Non-ESOP Options held by that person. In consideration for and subject to that cancellation, Unilife Corporation will grant one Unilife Corporation Non-ESOP Option to each Non-ESOP Optionholder for every six Non-ESOP Options held by them as at the Implementation Date (rounded down to the nearest whole number of Unilife Corporation Non-ESOP Options) on the terms set out in clause 7.3 below.
7.2		The offers set out in clause 7.1 will be conditional upon:

7.2.1 the Share Scheme becoming Effective; and

7.2.2 ASX granting a waiver on or before the Implementation Date of the requirement under Listing Rule 6.23 to obtain Shareholder approval for the cancellation of the Non-ESOP Options.

Terms of Unilife Corporation Non-ESOP Options

7.3 Each Unilife Corporation Non-ESOP Option issued in accordance with clause 7.1 will:

7.3.1 have an exercise price per option equal to six times the exercise price per option of the relevant Non-ESOP Options it replaces;

7.3.2 have an exercise period equal to the unexpired exercise period of the relevant Non-ESOP Options it replaces;

7.3.3 be vested to the same extent and have the same terms as to vesting as the relevant Non-ESOP Options it replaces; and

7.3.4 otherwise be issued on the terms of the Unilife Corporation Option Deeds.

8 Conversion of Company to a proprietary company

8.1 Within 10 Business Days following implementation of the Share Scheme, Unilife Corporation will pass a special resolution to convert the Company from a public company to a proprietary company limited by shares and lodge all necessary documentation with ASIC to give effect to the conversion of the Company from a public company to a proprietary company.

9 Termination

Termination by notice

9.1 Without prejudice to any other rights of termination under this Agreement, either Party may terminate this Agreement by giving the other Party written notice at any time before 8.00am on the Second Court Hearing Date if:

9.1.1 the other Party is in material breach of any term of this Agreement and:

(a) the Party wishing to terminate has given the other Party a written notice:

	(i)		setting out details of the breach; and
	(ii)		stating its intention to terminate, and

(b) the breach continues to exist five Business Days (or any shorter period ending at 5.00pm on the day before the Second Court Hearing Date) from the date the notice is given; or

9.1.2 the Board withdraws its recommendation of the Schemes.

Automatic termination

9.2 All of the obligations in this Agreement with respect to a Scheme will terminate automatically without the need for action by any Party in the event that:

9.2.1 the Independent Expert opines that such Scheme is not fair and reasonable and in the best interests of the Shareholders or Optionholders (as relevant); or

9.2.2 the Company’s Shareholders or Optionholders (as relevant) fail to approve such Scheme by the necessary majorities at the relevant Scheme Meeting; or

9.2.3 the Court refuses to grant an order convening any required Scheme Meeting or approving such Scheme and either the Parties agree not to conduct an appeal or the Parties agree to conduct an appeal but the appeal is unsuccessful; or

9.2.4 such Scheme is not approved by the Court under section 411(4)(b) of the Corporations Act on or before the Sunset Date.

Mutual termination

9.3 This Agreement may be terminated at any time by mutual consent of the Parties, provided that such consent to terminate is in writing and is signed by each of the Parties.

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Effect of termination

9.4 If either the Company or Unilife Corporation terminates this Agreement under clauses 2.11 or 9.1 or this Agreement terminates automatically under clause 9.2, this Agreement and the Parties’ obligations under it cease without any liability or obligation on behalf of the Parties other than those obligations under this clause and clauses 10, 12 and 13.

9.5 Termination of this Agreement under clause 9 does not affect any accrued rights of a Party in respect of a breach of this Agreement prior to termination.

10 Public announcements and disclosure

Public announcements

10.1 Neither Party may make a public announcement about this Agreement, the Information Memorandum or the Schemes unless:

10.1.1 the other Party has approved the form of the announcement; or

10.1.2 the law or the Listing Rules requires an announcement to be made, subject to clause 10.2.

Required disclosure

10.2 If the law or the Listing Rules require a Party to make an announcement or disclosure about either the subject of this Agreement or the Information Memorandum, that Party must give the other Party as much notice as is reasonably practical and to the extent reasonably practical consult with the other Party about the form and content of the announcement or disclosure.

Privacy Act

10.3 Each Party acknowledges that the other has obligations under the Privacy Xxx 0000 (Cth) in relation to personal information (defined as any information identifying or potentially identifying an individual) in its possession and forming part of the Party’s confidential information. Each Party undertakes to comply with these obligations to the same extent and degree as the Party from whom each has obtained the information is bound to observe them.

11 Buy back of shares in Unilife Corporation

11.1 Within 10 Business Days following the implementation of the Share Scheme, Unilife Corporation will buy back the Unilife Corporation Shares issued to the Company on incorporation for a nominal consideration of US$1.00 in accordance with the requirements of Delaware law.

12 Costs and stamp duty

12.1 Subject to clause 12.2, each Party must bear its own costs and expenses (including professional fees and stamp duty) incurred by it in connection with the negotiation, preparation and execution of this Agreement and the implementation or attempted implementation of the Schemes.

12.2 Unilife Corporation must pay all stamp duty and any related fines or penalties in respect of this Agreement, the Deeds Poll and the acquisition of the Scheme Shares in accordance with the Share Scheme.

13 Miscellaneous

Notices

13.1 Any notice, demand, consent or other communication (a Notice) given or made under this Agreement:

13.1.1 must be in writing and signed by a person duly authorised by the sender;

13.1.2 must be delivered to the intended recipient by prepaid post or by hand or fax to the address or fax number below or the address (being an address in Australia) or fax number last notified by the intended recipient to the sender:

		Company:
		Address:		Xxxxx 00, 0 Xxxxxxx Xxxxxx,
				Xxxxxx XXX 0000 Xxxxxxxxx
		Fax:		(00) 0000 0000
		Attention:		Mr Xxxx Xxxxxx
		Unilife Corporation:
		Address:		000 Xxxxxxx Xxxx
				Xxxxxxxxxx, Xxxxxxxxxxxx 00000
				Xxxxxx Xxxxxx of America
		Fax:		+ 0 000 000 0000
		Attention:		Xx Xxxx Xxxxxxxx

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13.1.3 will be taken to be duly given or made:

	(a)		in the case of delivery in person, when delivered;
	(b)		in the case of delivery by post:

	(i)		within Australia to an Australian address, two Business Days after the date of posting; and
	(ii)		in any other case, 10 Business Days after the date of posting;

(c) in the case of fax, on receipt by the sender of a transmission control report from the despatching machine showing the relevant number of pages and the correct destination fax machine number or name of recipient and indicating that the transmission has been made without error, but if the result is that a Notice would be taken to be given or made on a day that is not a Business Day in the place to which the Notice is sent or is later than 4.00pm (local time) it will be taken to have been duly given or made at the commencement of business on the next Business Day in that place.

No waiver

13.2 No failure to exercise nor any delay in exercising any right, power or remedy by a Party operates as a waiver. A single or partial exercise of any right, power or remedy does not preclude any other or further exercise of that or any other right, power or remedy. A waiver is not valid or binding on the Party granting that waiver unless made in writing.

Remedies cumulative

13.3 The rights, powers and remedies provided to each Party in this Agreement are in addition to, and do not exclude or limit, any right, power or remedy provided by law or equity or by any agreement.

Entire agreement

13.4 This Agreement contains the entire agreement between the Parties as at the date of this Agreement with respect to its subject matter and supersedes all prior agreements and understandings between the Parties in connection with it.

Amendment

13.5 No amendment or variation of this Agreement is valid or binding on a Party unless made in writing executed by the Company and Unilife Corporation which may so make an amendment or variation notwithstanding that one or more other persons may be entitled to the benefit of all or any of the provisions of this Agreement.

Assignment

13.6 The rights and obligations of each Party under this Agreement are personal. They cannot be assigned, encumbered or otherwise dealt with and no Party may attempt, or purport, to do so without the prior consent of the other Party.

Consents or approvals

13.7 A Party may:

	13.7.1		give conditionally or unconditionally; or
	13.7.2		withhold, its approval or consent in its absolute discretion unless this Agreement expressly provides otherwise.

No merger

13.8 The rights and obligations of the Parties will not merge on the completion of any transaction contemplated by this Agreement. They will survive the execution and delivery of any assignment or other document entered into for the purpose of implementing a transaction.

Further assurances

13.9 Each Party agrees to do all things and execute all deeds, instruments, transfers or other documents as may be necessary or desirable to give full effect to the provisions of this Agreement and the transactions contemplated by it.

Severability of provisions

13.10 Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction is ineffective as to that jurisdiction to the extent of the prohibition or unenforceability. That does not invalidate the remaining provisions of this Agreement nor affect the validity or enforceability of that provision in any other jurisdiction.

Counterparts

13.11 This Agreement may be executed in any number of counterparts. All counterparts together will be taken to constitute one instrument, it being understood that both Parties need not sign the same counterpart.

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GST

13.12 Unless expressly included, the consideration for any supply under or in connection with this Agreement does not include GST.

13.13 To the extent that any supply made by a Party to another Party (Recipient) under or in connection with this Agreement is a taxable supply and a tax invoice has been provided to the Recipient, the Recipient must pay, in addition to the consideration to be provided under this Agreement for that supply (unless it expressly includes GST), an amount equal to the amount of that consideration (or its GST exclusive market value) multiplied by the rate at which GST is imposed in respect of the supply.

13.14 The amount of GST payable in accordance with clause 13.13 will be paid at the same time and in the same manner as the consideration otherwise payable for the supply is provided.

14 Governing law and jurisdiction

14.1		This document is governed by the law of New South Wales. The Parties submit to the non-exclusive jurisdiction of its courts and courts of appeal from them. The Parties will not object to the exercise of jurisdiction by those courts on any basis. Definitions and interpretation.
15		Definitions and interpretations

Definitions

15.1		In this Agreement the following definitions apply:
		APRA means the Australian Prudential Regulation Authority.
		ASIC means the Australian Securities and Investments Commission.
		ASTC means ASX Settlement and Transfer Corporation Pty Limited (ABN 49 008 504 532).
		ASX means ASX Limited (ACN 008 624 691) or the securities market which it operates, as the context requires.
		Board means the Board of Directors of the Company from time to time.
		Business Day means a day that is not a Saturday, Sunday or a public holiday or bank holiday in Sydney, Australia.
		CDI means the CHESS Depositary Interest to be issued in connection with the Share Scheme representing an interest in one sixth of a Unilife Corporation Share.
		CDI Register has the meaning given to that term in the ASTC Settlement Rules.
		CHESS Depositary Interest has the meaning given to that term in the ASTC Settlement Rules.
		Corporations Act means the Corporations Xxx 0000 (Cth).
		Court means the Federal Court of Australia or any other court of competent jurisdiction under the Corporations Act agreed in writing by the Company and Unilife Corporation.
		Deeds Poll means the Share Scheme Deed Poll and the Option Scheme Deed Poll.
		Depositary has the meaning given to it in the ASTC Settlement Rules.
		Directors means the directors of the Company.
		Despatch Date means the day that the Information Memorandum is despatched to Shareholders and Optionholders.
		Effective means, when used in relation to a Scheme, the coming into effect, under section 411(10) of the Corporations Act, of the Court order made under section 411(4)(b) of the Corporations Act in relation to that Scheme.
		Effective Date means the date on which a Scheme becomes Effective.
		ESOP means the Unilife Medical Solutions Limited Employee Share Option Plan.
		First Court Hearing Date means the date the Court hears the application to order the convening of the Scheme Meetings under section 411(1) of the Corporations Act.
		Government Agency means:

(a) a government, whether foreign, federal, state, territorial or local;

(b) a department, office or minister of a government (whether foreign, federal, state, territorial or local) acting in that capacity; or

(c) a court, administrative agency, arbitration tribunal, commission, delegate, instrumentality, agency, board, or other government, semi-government, judicial, administrative, monetary or fiscal authority, whether statutory or not and whether foreign, federal, state, territorial or local, and includes ASX, ASIC, the Takeovers Panel and APRA.

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GST means goods and services tax.

Implementation Date means the third Business Day following the Scheme Record Date.

Independent Expert means the independent expert in respect of the Schemes appointed by the Company in accordance with clause 6 to consider whether the Schemes are fair and reasonable to and in the best interests of Shareholders and Optionholders.

Ineligible Overseas Shareholder means a Scheme Shareholder who is registered in the Register with an address outside Australia and its external territories, New Zealand, United Kingdom, Xxxxxxx, Xxxxxx, Xxxxx, Xxxx Xxxx, Xxxxxxx and the United States or any other country agreed to by the Company and Unilife Corporation.

Information Memorandum means the document containing the information described in clause 6.2.1 to be approved by the Court and to be despatched to Shareholders and Optionholders to assist them in deciding on how to vote on the Schemes.

Listing Rules means the official listing rules of ASX as amended from time to time.

Lodgement Date means the date of lodgement of the Information Memorandum with ASIC.

Nominee means the nominee selected by Unilife Corporation prior to the Implementation Date for the purposes of clause 2.1.7.

Non-ESOP Options means the options issued to certain consultants and advisers to the Company and other third parties all of which were issued outside of the ESOP.

Option Scheme means the proposed scheme of arrangement, substantially in the form set out in Annexure 2, under Part 5.1 of the Corporations Act between the Company and Scheme Optionholders as described in clause 4, subject to any alterations or conditions made or required by the Court and approved in writing by the Parties.

Option Scheme Consideration means the consideration for the cancellation of the Options as set out in clause 4.3.

Option Scheme Deed Poll means the deed poll to be executed by Unilife Corporation substantially in the form of Annexure 4, under which Unilife Corporation covenants in favour of Scheme Optionholders to perform its obligations under this Agreement and the obligations contemplated of it under the Option Scheme, with such amendments as are approved by the Court or as the Company and Unilife Corporation may otherwise agree.

Option Scheme Meeting means the meeting of Optionholders ordered by the Court to be convened under section 411(1) of the Corporations Act to consider the Option Scheme.

Optionholder means a person registered in the Company’s option register as a holder of Options.

Options means options issued under the ESOP entitling holders to subscribe for Shares.

Parties mean the Company and Unilife Corporation.

Proposed Transaction means the redomiciliation transaction which is to be effected on the Implementation Date, under which:

	(a)		Unilife Corporation will acquire all of the Shares under the Share Scheme;
	(b)		the Company will cancel all of the Options under the Option Scheme;
	(c)		the Company will cancel all of the Non-ESOP Options; and

(d) the existing security holders of the Company will receive Unilife Corporation Shares (or CDIs), Unilife Corporation Options and Unilife Corporation Non-ESOP Options (as relevant).

Register means the Company’s register of shareholders.

Regulatory Consents has the meaning given to that term in clause 2.1.2.

Related Bodies Corporate has the meaning given to that term in the Corporations Act.

Scheme Meetings means the Share Scheme Meeting and the Option Scheme Meeting.

Scheme Optionholder means an Optionholder as at the Scheme Record Date.

Scheme Record Date means 7.00 pm on the fifth Business Day after the Effective Date or any other date agreed with ASX to be the record date for the Schemes to determine entitlements to receive consideration pursuant to the Schemes.

Scheme Shareholder means a Shareholder as at the Scheme Record Date.

Scheme Shares means all Shares held by Scheme Shareholders as at the Scheme Record Date.

Schemes means the Share Scheme and the Option Scheme.

Second Court Hearing Date means the first day on which an application to the Court for orders under section 411(4)(b) of the Corporations Act approving the Schemes is heard.

Share means one fully paid ordinary share in the Company.

Share Scheme means the proposed scheme of arrangement, substantially in the form set out in Annexure 1, under Part 5.1 of the Corporations Act between the Company and Scheme Shareholders as described in clause 3 subject to any alterations or conditions made or required to be made by the Court and approved in writing by the Parties.

Share Scheme Consideration means the consideration for the transfer of the Scheme Shares to Unilife Corporation as set out in clause 3.2.

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Share Scheme Deed Poll means the deed poll to be executed by Unilife Corporation substantially in the form of Annexure 3, under which Unilife Corporation covenants in favour of Scheme Shareholders to perform its obligations under this Agreement and the obligations contemplated of it under the Share Scheme, with such amendments as are approved by the Court or as the Company and Unilife Corporation may otherwise agree.

Share Scheme Meeting means the Shareholders’ meeting ordered by the Court to be convened under section 411(1) of the Corporations Act to consider the Share Scheme.

Shareholder means each person who is registered in the Register as a holder of Shares.

Subsidiary has the meaning given to that term in section 46 of the Corporations Act.

Sunset Date means 5.00pm on 30 June 2010 or such other date and time agreed in writing between Unilife Corporation and the Company.

Unilife Corporation Employee Stock Option Plan means the Unilife Corporation Employee Stock Option Plan in the form agreed between the Parties to be adopted by Unilife Corporation in accordance with clause 4.1.

Unilife Corporation Non-ESOP Options means options granted by Unilife Corporation outside the Unilife Corporation Employee Stock Option Plan.

Unilife Corporation Option Deeds means the deeds under which the Unilife Corporation Non-ESOP Options will be granted by Unilife Corporation to each holder of Non-ESOP Options.

Unilife Corporation Options means options to subscribe for Unilife Corporation Shares under the Unilife Corporation Employee Stock Option Plan.

Unilife Corporation Shares means shares of fully paid common stock in the capital of Unilife Corporation.

Interpretation

15.2 In the interpretation of this Agreement, the following provisions apply unless the context otherwise requires:

15.2.1 The singular includes the plural and conversely.

15.2.2 If a word or phrase is defined, its other grammatical forms have a corresponding meaning.

15.2.3 A reference to a person, corporation, trust, partnership, unincorporated body or other entity includes any of them.

	15.2.4		A reference to a clause, schedule or annexure is a reference to a clause of, or schedule or annexure to, this Agreement.
	15.2.5		A reference to A$ or cents is to the lawful currency of Australia.

15.2.6 The clause headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

15.2.7 A reference to an agreement or document (including a reference to this Agreement) is to the agreement or document as amended, varied, supplemented, novated or replaced, except to the extent prohibited by this Agreement or that other agreement or document.

15.2.8 A reference to a person includes a reference to the person’s executors, administrators, successors, substitutes (including persons taking by novation) and assigns.

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15.2.9 A reference to legislation or to a provision of legislation includes a modification or re-enactment of it, a legislative provision substituted for it and a regulation or statutory instrument issued under it.

	15.2.10		Words and phrases not specifically defined in this Agreement have the same meanings (if any) given to them in the Corporations Act.
	15.2.11		A reference to time is a reference to time in Sydney, Australia.

15.2.12 A reference to the word ‘include’ or ‘including’ is to be construed without limitation.

15.2.13 If the day on which any act, matter or thing is to be done is a day other than a Business Day, such act, matter or thing must be done on the immediately succeeding Business Day.

15.2.14 The meaning of general words is not limited by specific examples introduced by including, or for example, or similar expressions.

15.2.15 A reference to a Party using its best endeavours or reasonable endeavours does not include a reference to that Party paying money or providing other valuable consideration to or for the benefit of any person (and an obligation on a Party to use its best or reasonable endeavours does not oblige that Party to pay money or provide other valuable consideration to or for the benefit of any person).

Construction

15.3 This Agreement must not be construed adversely to a Party solely because that Party or its solicitors were responsible for preparing it.

Payments

15.4 Unless otherwise expressly provided in this Agreement, where an amount is required to be paid to a Party (Receiving Party) by another Party under this Agreement, that amount must be paid:

15.4.1 in immediately available and irrevocable funds by electronic transfer to a bank account or accounts notified by the Receiving Party in writing on or before the due date for payment or in other such immediately payable funds as the Parties agree; and

15.4.2 without deduction, withholding or set-off.

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Execution and date
Executed as an agreement.
Executed by Unilife Medical Solutions Limited acting by the following persons:
/s/ Xxxx Xxxxxxxx				/s/ Xxxx Xxxxxx
Signature of director				Signature of director/company secretary
Xxxx Xxxxxxxx				Xxxx Xxxxxx
Name of director (print)				Name of director/company secretary (print)
Executed by Unilife Corporation acting by the following persons:
/s/ Xxxx Xxxxxxxx
Signature of duly authorised officer				Signature of duly authorised officer
Xxxx Xxxxxxxx
Name of duly authorised officer (print)				Name of duly authorised officer (print)

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Annexure 1 Share Scheme of Arrangement

000 Xxxxxxxxx Xxxxxx

Xxxxxx XXX 0000

Xxxxxxxxx

DX 000 Xxxxxx

Tel x00 0 0000 0000

Fax x00 0 0000 0000

xxx.xxxxxxxxxxxxxx.xxx

Share Scheme of Arrangement

Unilife Medical Solutions Limited
The holders of fully paid ordinary shares in
Unilife Medical Solutions Limited

DLA Xxxxxxxx Fox is a member of DLA Piper Group, an alliance of independent legal practices. It is a separate and distinct legal entity.

DLA Xxxxxxxx Xxx offices are located in Adelaide Auckland Brisbane Canberra Melbourne Perth Sydney and Wellington.

Table of contents

Operative provisions			1
1 Preliminary			1
The Company			1
Unilife Corporation			1
Effect of Share Scheme			1
Merger Implementation Agreement and Share Scheme Deed Poll			1
2 Conditions precedent			2
Conditions precedent to Share Scheme			2
Certificate in relation to conditions precedent			2
Lapse of Share Scheme			2
3 Implementation of Share Scheme			3
Lodgement of Court order			3
Provision of Share Scheme Consideration			3
Transfer of Scheme Shares			3
4 Provision of Share Scheme Consideration			3
Provision of Share Scheme Consideration			3
Election			4
Restrictions on Unilife Corporation Shares			4
Fractional entitlements			4
Ineligible Overseas Shareholders			4
Obligations of Scheme Shareholders			5
Joint holders			5
General			5
5 Dealings in the Shares			6
Determination of Scheme Shareholders			6
Maintenance of the Share Register			6
Effect of certificates and holding statements			6
Information to be made available to Unilife Corporation			7
6 Quotation of the Shares			7
7 General Share Scheme provisions			7
Appointment of the Company as agent and attorney			7
Scheme Shareholders’ consent			8
Agreement by Scheme Shareholders			8
Warranty by Scheme Shareholders			8
Rights in Scheme Shares			8
Title to Scheme Shares			8
Appointment of Unilife Corporation as sole proxy			8
Share Scheme alterations and conditions			9
Enforcement of Share Scheme Deed Poll			9
Effect of Share Scheme			9
Notices			9
Further assurances			9
Costs and stamp duty			9
8 Governing law and jurisdiction			10
9 Definitions and Interpretation			10
Definitions			10
Interpretation			12

Share Scheme of Arrangement
pursuant to section 411 of the Corporations Xxx 0000 (Cth)

Unilife Medical Solutions Limited ABN 14 000 000 000 of Suite 3, Xxxxx 00, 0 Xxxxxxx Xxxxxx, Xxxxxx, XXX 0000 (Company)

The holders of fully paid ordinary shares in the Company

Operative provisions

1 Preliminary

The Company

1.1 The Company is a public company limited by shares, incorporated in Australia and registered in South Australia. Its registered office is at Xxxxx 0, Xxxxx 00, 0 Xxxxxxx Xxxxxx, Xxxxxx, XXX 0000.

1.2 The Company is admitted to the official list of ASX and the Shares are officially quoted on the financial market operated by ASX.

1.3 As at 25 November 2009, 293,520,768 Shares were on issue.

Unilife Corporation

1.4 Unilife Corporation is a corporation limited by shares, incorporated in Delaware, United States. Its registered office is at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx, 00000, County of New Castle.

1.5 As at 25 November 2009, the authorised capital stock of Unilife Corporation comprised 250,000,000 shares of common stock of US$0.01 par value of which 100 Unilife Corporation Shares were on issue and 50,000,000 shares of preferred stock of US$0.01 par value of which none were on issue.

Effect of Share Scheme

1.6 If this Share Scheme becomes Effective:

1.6.1 Unilife Corporation will provide the Share Scheme Consideration to each Scheme Shareholder in accordance with the terms of this Share Scheme;

1.6.2 all of the Scheme Shares will be transferred to Unilife Corporation; and

1.6.3 the Company will enter the name and address of Unilife Corporation in the Share Register as the holder of all of the Scheme Shares.

Merger Implementation Agreement and Share Scheme Deed Poll

1.7 The Company and Unilife Corporation have entered into the Merger Implementation Agreement which sets out the terms on which the Company and Unilife Corporation have agreed to implement this Share Scheme.

1.8 Unilife Corporation has executed the Share Scheme Deed Poll in favour of each Scheme Shareholder pursuant to which it has covenanted to perform its obligations under the Merger Implementation Agreement and this Share Scheme, including to provide the Share Scheme Consideration to Scheme Shareholders.

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2 Conditions precedent

Conditions precedent to Share Scheme

2.1 This Share Scheme is conditional on:

2.1.1 as at 8.00am on the Second Court Hearing Date, the Merger Implementation Agreement not having been terminated in accordance with its terms;

2.1.2 all of the conditions precedent set out in clause 2.1 of the Merger Implementation Agreement having been satisfied or waived in accordance with the terms of that agreement;

2.1.3 the Court having approved this Share Scheme, with or without modification, pursuant to section 411(4)(b) of the Corporations Act; and

2.1.4 such other conditions made or required by the Court pursuant to section 411(6) of the Corporations Act in relation to this Share Scheme as are acceptable to the Company and Unilife Corporation, having been satisfied,

and the provisions of clauses 3 to 7 will not come into effect unless and until each of these conditions precedent has been satisfied.

Certificate in relation to conditions precedent

2.2 On the Second Court Hearing Date, the Company and Unilife Corporation will each provide to the Court a certificate confirming whether or not all of the conditions precedent set out in clause 2.1 of the Merger Implementation Agreement (other than in relation to this Share Scheme being approved by the Court pursuant to section 411(4)(b) of the Corporations Act) have been satisfied or waived in accordance with the terms of that agreement.

2.3 The giving of a certificate by each of the Company and Unilife Corporation under clause 2.2 will, in the absence of manifest error, be conclusive evidence of the satisfaction or waiver of the conditions precedent referred to in the certificate.

Lapse of Share Scheme

2.4 This Share Scheme will lapse and be of no further force or effect if the Effective Date has not occurred on or before the Sunset Date.

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3 Implementation of Share Scheme

Lodgement of Court order

3.1 On or before 5.00pm on the first Business Day following approval of this Share Scheme by the Court pursuant to section 411(4)(b) of the Corporations Act, the Company will lodge with ASIC an office copy of the Court order approving this Share Scheme.

Provision of Share Scheme Consideration

3.2 On the Implementation Date, in consideration for the transfer to Unilife Corporation of all of the Scheme Shares, Unilife Corporation must provide the Share Scheme Consideration to each Scheme Shareholder in accordance with clause 4.

Transfer of Scheme Shares

3.3 On the Implementation Date, in consideration for and immediately following the issue of the Share Scheme Consideration in accordance with clause 4:

3.3.1 all of the Scheme Shares, together with all rights and entitlements attaching to those shares at that date, will be transferred to Unilife Corporation without the need for any further act by any Scheme Shareholder by the Company effecting a valid transfer or transfers of the Scheme Shares under section 1074D of the Corporations Act or delivering to Unilife Corporation duly completed and executed share transfer forms (or a master transfer form) in accordance with section 1071B of the Corporations Act and Unilife Corporation executing and delivering those share transfer form(s) to the Company; and

3.3.2 the Company will enter the name and address of Unilife Corporation in the Share Register as the holder of all of the Scheme Shares.

4 Provision of Share Scheme Consideration

Provision of Share Scheme Consideration

4.1 The obligation of the Company to procure Unilife Corporation to pay the Share Scheme Consideration will be satisfied on the Implementation Date by the Company procuring that Unilife Corporation, in accordance with its covenant in favour of Scheme Shareholders contained in clause 2.2 of the Share Scheme Deed Poll, issues to such Scheme Shareholders (or, in accordance with clause 4.7 to a Nominee on its behalf where such Scheme Shareholder is an Ineligible Overseas Shareholder):

4.1.1 One Unilife Corporation Shares for every six Shares held by the Scheme Shareholder on the Scheme Record Date, where such Scheme Shareholder has made an election to receive Unilife Corporation Shares in accordance with clause 4.2; or

4.1.2 Six CDIs for every Unilife Corporation Share to which the Scheme Shareholder would be entitled under clause 4.1.1, where the Scheme Shareholder has made an election to receive CDIs or has not made an election in accordance with clause 4.2.

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Election

4.2 Each Scheme Shareholder may make an election to receive Unilife Corporation Shares or CDIs by providing written notice to the Share Registry by 5.00pm on the Scheme Record Date (or such other date notified to Scheme Shareholders).

4.3 An election under clause 4.2 may only be made in respect of all and not only some of the Scheme Shares held by a Scheme Shareholder.

4.4 If a Scheme Shareholder does not make an election in accordance with clause 4.2, a Scheme Shareholder will receive CDIs under this Share Scheme.

Restrictions on Unilife Corporation Shares

4.5 Each Unilife Corporation Share or CDI issued pursuant to this Share Scheme will be subject to the same restrictions (if applicable) as the Share it replaces.

Fractional entitlements

4.6 Fractional entitlements to Share Scheme Consideration will be rounded down to the nearest:

4.6.1 whole number of Unilife Corporation Shares, if the Scheme Shareholder has elected to receive Unilife Corporation Shares under this Share Scheme; or

4.6.2 multiple of six CDIs, if the Scheme Shareholder has elected to receive CDIs or has not made an election under clause 4.2,

after aggregating all holdings of such Scheme Shareholder.

Ineligible Overseas Shareholders

4.7 Where a Scheme Shareholder is an Ineligible Overseas Shareholder, the Company will procure that Unilife Corporation, in accordance with its covenant in favour of Scheme Shareholders contained in clause 2.2 of the Share Scheme Deed Poll, issues the number of CDIs to which the Scheme Shareholder would otherwise be entitled under this Share Scheme to a Nominee of Unilife Corporation who will sell those CDIs as soon as reasonably practicable (at the risk of that Ineligible Overseas Shareholder) and pay the net proceeds received (calculated on an averaged basis so that all Ineligible Overseas Shareholders receive the same price per CDI subject to rounding to the nearest cent), after deducting any applicable brokerage and other taxes and charges, to that Ineligible Overseas Shareholder in full satisfaction of that Ineligible Overseas Shareholder’s rights to Share Scheme Consideration. The net proceeds of sale will be paid by cheque in Australian dollars and dispatched by mail to Ineligible Overseas Shareholders to their address in the Share Register.

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Obligations of Scheme Shareholders

4.8 Each Scheme Shareholder who will be issued Unilife Corporation Shares under the Share Scheme agrees:

4.8.1 to become a stockholder of Unilife Corporation;

4.8.2 to have their name and address entered into the register of stockholders maintained by Unilife Corporation;

4.8.3 to be bound by the Certificate of Incorporation and by-laws of Unilife Corporation in force from time to time in respect of the Unilife Corporation Shares.

Joint holders

4.9 In the case of Scheme Shares held in joint names:

4.9.1 any holding statement or transmittal letters for Unilife Corporation Shares or CDIs which are to be issued to Scheme Shareholders under this Share Scheme will be issued in the names of the joint holders and sent to the holder whose name appears first in the Share Register on the Scheme Record Date; and

4.9.2 any cheque required to be paid to Scheme Shareholders with respect to Share Scheme Consideration will be paid to the joint holders and will be forwarded to the holder whose name appears first in the Share Register on the Scheme Record Date.

General

4.10 The obligation of the Company to procure Unilife Corporation to issue Unilife Corporation Shares under clause 4.1 of this Share Scheme will be satisfied by Unilife Corporation on the Implementation Date procuring the entry in the register maintained by Unilife Corporation of holders of Unilife Corporation Shares of each person who is to receive Unilife Corporation Shares.

4.11 After the satisfaction of the obligation of the Company in clause 4.10, and within five Business Days after the Implementation Date, the Company will procure Unilife Corporation to:

4.11.1 issue holding statements, certificates or transmittal letters (as the case may be) for such Unilife Corporation Shares in the name of such persons; and

4.11.2 procure the despatch of such holding statements, certificates or transmittal letters to the address as shown in the register for such persons.

4.12 The obligation of the Company to procure Unilife Corporation to issue CDIs under clause 4.1 of this Share Scheme will be satisfied by Unilife Corporation on the Implementation Date procuring the entry in the register maintained by Unilife Corporation of holders of Unilife Corporation Shares of the Depositary as depositary to hold the Unilife Corporation Shares underlying those CDIs and procuring the Depositary to issue CDIs to Scheme Shareholders in accordance with this Share Scheme.

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4.13 After the satisfaction of the obligation of the Company in clause 4.12, and within five Business Days after the Implementation Date, Unilife Corporation will:

4.13.1 issue holding statements or transmittal letters (as the case may be) for such Unilife Corporation Shares in the name of the Depositary, and procure the despatch of such holding statements or transmittal letters to the Depositary;

4.13.2 record in the CDI Register each person who is to receive CDIs under clause 4.1; and

4.13.3 despatch to each person who is to receive CDIs under clause 4.1 a holding statement in the name of that person representing the number of CDIs to be issued to that person.

5 Dealings in the Shares

Determination of Scheme Shareholders

5.1 For the purpose of determining who are Scheme Shareholders, dealings in Shares will only be recognised if:

5.1.1 in the case of dealings of the type to be effected using CHESS, the transferee is registered in the Share Register as the holder of the relevant Shares by the Scheme Record Date; or

5.1.2 in all other cases, registrable transfers or transmission applications in respect of those dealings are received on or before the Scheme Record Date at the place where the Share Register is kept.

5.2 The Company must register registrable transfers or transmission applications of the kind referred to in clause 5.1.2 by the Scheme Record Date provided that nothing in this clause 5.2 requires the Company to register a transfer that would result in a Shareholder holding a parcel of Shares that is less than a Marketable Parcel.

5.3 The Company will not accept for registration, nor recognise for any purpose, any transfer or transmission application in respect of Shares received after the Scheme Record Date (other than the transfers contemplated by clause 3.3).

Maintenance of the Share Register

5.4 For the purpose of determining entitlements to the Share Scheme Consideration, the Company will, until the Share Scheme Consideration has been provided, maintain or procure the maintenance of the Share Register in accordance with this clause 5. The Share Register in this form will solely determine entitlements to the Share Scheme Consideration.

Effect of certificates and holding statements

5.5 From the Scheme Record Date (other than for Unilife Corporation after the Implementation Date), all certificates and holding statements for the Scheme Shares will cease to have effect as documents of title, and each entry on the Share Register at that date will cease to have any effect other than as evidence of an entitlement to the Share Scheme Consideration.

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Information to be made available to Unilife Corporation

5.6 The Company will procure that, as soon as reasonably practicable after the Scheme Record Date, details of the names, registered addresses and holdings of Scheme Shares of every Scheme Shareholder as shown in the Share Register at the Scheme Record Date are made available to Unilife Corporation in such form as Unilife Corporation or Unilife Corporation’s Share Registry reasonably requires.

6 Quotation of the Shares

6.1 The Company will apply to ASX for:

6.1.1 suspension of the Shares from official quotation on ASX with effect from close of trading on the Business Day after the Effective Date; and

6.1.2 termination of official quotation of the Shares on ASX after the Implementation Date.

7 General Share Scheme provisions

Appointment of the Company as agent and attorney

7.1 Each Scheme Shareholder, without the need for any further act, irrevocably appoints the Company and each of the directors and officers of the Company, jointly and severally, as its attorney and agent for the purpose of:

7.1.1 in the case of Scheme Shares in a CHESS holding:

(a) causing a message to be transmitted to ASTC in accordance with ASTC Settlement Rules to transfer the Scheme Shares held by the Scheme Shareholder from the CHESS subregister of the Company to the issuer sponsored subregister operated by the Company notwithstanding that, at the time of such transfer, Unilife Corporation has not provided the Share Scheme Consideration which is due under this Share Scheme to the Scheme Shareholders; and

(b) completing and signing on behalf of Scheme Shareholders any required form of transfer of Scheme Shares; and

7.1.2 in the case of Scheme Shares registered in the issuer sponsored subregister operated by the Share Registry, completing and signing on behalf of Scheme Shareholders any required form of transfer; and

7.1.3 in all cases, executing any document or doing any other act necessary to give full effect to this Share Scheme and the transactions contemplated by it.

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Scheme Shareholders’ consent

7.2 Each Scheme Shareholder consents to the Company doing all things and executing all deeds, instruments, transfers and other documents as may be necessary or desirable to give full effect to this Share Scheme and the transactions contemplated by it.

7.3 Each Scheme Shareholder agrees to be bound by the Certificate of Incorporation and by-laws of Unilife Corporation in respect of the Unilife Corporation Shares or CDIs issued to them pursuant to this Share Scheme.

Agreement by Scheme Shareholders

7.4 Each Scheme Shareholder agrees to the transfer of all of their Scheme Shares to Unilife Corporation in accordance with the terms of this Share Scheme.

Warranty by Scheme Shareholders

7.5 Each Scheme Shareholder is deemed to have warranted to Unilife Corporation that:

7.5.1 all of their Scheme Shares (including any rights and entitlements attaching to those shares) transferred to Unilife Corporation under this Share Scheme will, on the date of the transfer, be fully paid and free from all mortgages, charges, liens, encumbrances, pledges, security interests and other interests of third parties of any kind, whether legal or otherwise; and

7.5.2 they have full power and capacity to sell and transfer their Scheme Shares (including any rights and entitlements attaching to those shares).

The Company undertakes in favour of each Scheme Shareholder that it will provide such warranty to Unilife Corporation on behalf of the Scheme Shareholder.

Rights in Scheme Shares

7.6 Shareholders shall be entitled to any dividends and other distributions declared or paid on the Shares prior to the Implementation Date.

Title to Scheme Shares

7.7 Unilife Corporation will be beneficially entitled to all of the Scheme Shares transferred to it under this Share Scheme pending registration by the Company of Unilife Corporation in the Share Register as the holder of all of the Scheme Shares.

Appointment of Unilife Corporation as sole proxy

7.8 From the Implementation Date until the Company registers Unilife Corporation in the Share Register as the holder of all of the Scheme Shares, each Scheme Shareholder:

7.8.1 is deemed to have irrevocably appointed the Chairman of Unilife Corporation as their sole proxy and, where applicable, corporate representative, to attend shareholders’ meetings of the Company, exercise the votes attached to the Scheme Shares registered in their name and sign any shareholders’ resolutions, whether in person, by proxy or by corporate representative;

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7.8.2 must not attend or vote at any shareholders’ meetings of the Company, or sign any resolutions, whether in person, by proxy or by corporate representative, other than under this clause 7.8; and

7.8.3 must take all other actions in the capacity of the registered holder of Scheme Shares as Unilife Corporation directs.

The Company undertakes in favour of each Scheme Shareholder that it will appoint the Chairman of Unilife Corporation as that Scheme Shareholder’s proxy or, where applicable, corporate representative, in accordance with this clause 7.8.

Share Scheme alterations and conditions

7.9 If the Court proposes to approve this Share Scheme subject to any alterations or conditions, the Company may, by its counsel or solicitors, and with the consent of Unilife Corporation, consent to those alterations or conditions on behalf of all persons concerned, including, for the avoidance of doubt, all Scheme Shareholders.

Enforcement of Share Scheme Deed Poll

7.10 The Company undertakes in favour of each Scheme Shareholder to enforce the Share Scheme Deed Poll against Unilife Corporation on behalf of and as agent and attorney for the Scheme Shareholders.

Effect of Share Scheme

7.11 This Share Scheme binds the Company and all Shareholders (including those who do not attend the Share Scheme Meeting, do not vote at the Share Scheme Meeting or vote against the Share Scheme) and, to the extent of any inconsistency and to the extent permitted by law, overrides the constitution of the Company.

Notices

7.12 Where a notice, transfer, transmission application, direction or other communication referred to in this Share Scheme is sent by post to the Company, it will not be deemed to be received in the ordinary course of post or on a date other than the date (if any) on which it is actually received at the Company’s registered office or at the place where the Share Register is kept.

Further assurances

7.13 The Company will execute all deeds, instruments, transfers and other documents and do all acts and things (on its own behalf and on behalf of each Scheme Shareholder) as may be necessary or desirable to give full effect to this Share Scheme and the transactions contemplated by it.

Costs and stamp duty

7.14 Subject to the terms of the Merger Implementation Agreement, the Company will pay the costs of the Share Scheme, except that Unilife Corporation will pay any stamp duty payable on the transfer by Scheme Shareholders of the Scheme Shares to Unilife Corporation.

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8 Governing law and jurisdiction

8.1		This Share Scheme is governed by the laws of New South Wales, Australia.
8.2		Each party irrevocably and unconditionally:

8.2.1 submits to the non-exclusive jurisdiction of the courts of New South Wales; and

8.2.2 waives, without limitation, any claim or objection based on absence of jurisdiction or inconvenient forum.

9 Definitions and Interpretation

Definitions

9.1 In this Share Scheme, unless the context requires otherwise:

ASIC means the Australian Securities and Investments Commission.

ASTC means the ASX Settlement and Transfer Corporation Pty Ltd ABN 49 008 504 532.

ASTC Settlement Rules means the Settlement Rules of ASTC.

ASX means ASX Limited ABN 98 008 624 691 or the securities market it operates, as the context requires.

ASX Market Rules means the Market Rules of ASX.

Business Day means a day that is not a Saturday, Sunday, public holiday or bank holiday in Sydney, Australia.

CDI means the CHESS Depositary Interest to be issued in connection with the Share Scheme representing an interest in one sixth of a Unilife Corporation Share.

CDI Register has the meaning given to that term in the ASTC Settlement Rules.

CHESS means the Clearing House Electronic Sub-Register System of share transfers operated by ASTC.

CHESS Depositary Interest has the meaning given to that term in the ASTC Settlement Rules.

Company means Unilife Medical Solutions Limited ABN 14 000 000 000

Corporations Act means the Corporations Xxx 0000 (Cth).

Court means the Federal Court of Australia or any other court of competent jurisdiction under the Corporations Act agreed in writing by the Company and Unilife Corporation.

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Depositary has the meaning given to that term in the ASTC Settlement Rules.

Effective means, when used in relation to this Share Scheme, the coming into effect, pursuant to section 411(10) of the Corporations Act, of the Court order made under section 411(4)(b) of the Corporations Act in relation to this Share Scheme, but in any event at no time before an office copy of the order of the Court is lodged with ASIC.

Effective Date means the date on which this Share Scheme becomes Effective.

Implementation Date means the third Business Day following the Scheme Record Date.

Ineligible Overseas Shareholder means a Scheme Shareholder who is registered in the Share Register with an address outside Australia and its external territories, New Zealand, France, Ireland, United Kingdom, Malta, Hong Kong and United States and such other country agreed to by the Company and Unilife Corporation.

Information Memorandum means the document containing the information described in clause 6.2.1 of the Merger Implementation Agreement to be approved by the Court and to be despatched to Shareholders.

Marketable Parcel has the meaning given in the ASX Market Rules.

Merger Implementation Agreement means the merger implementation agreement dated 1 September 2009 between the Company and Unilife Corporation.

Nominee means the nominee selected by Unilife Corporation prior to the Implementation Date for the purposes of clause 4.7.

Related Body Corporate has the meaning given to that term in the Corporations Act.

Scheme Record Date means 7.00pm on the fifth Business Day after the Effective Date or any other date agreed with ASX to be the record date for the Share Scheme to determine entitlements to receive Share Scheme Consideration.

Scheme Share means a Share held by a Scheme Shareholder at the Scheme Record Date.

Scheme Shareholder means a Shareholder, as at the Scheme Record Date.

Second Court Hearing Date means the first day on which the application made to the Court for an order approving this Share Scheme pursuant to section 411(4)(b) of the Corporations Act is heard, or if the hearing of the application is adjourned for any reason, the first day of the adjourned hearing.

Share means a fully paid ordinary share in the Company.

Shareholder means each person who is registered in the Share Register as a holder of the Shares.

Share Register means the register of shareholders of the Company maintained by or on behalf of the Company in accordance with section 168(1) of the Corporations Act.

11

Share Registry means Computershare Investor Services Pty Limited ABN 48 078 279 277.

Share Scheme means this scheme of arrangement under Part 5.1 of the Corporations Act between the Company and Scheme Shareholders, subject to any alterations or conditions made or required by the Court and approved in writing by the parties.

Share Scheme Consideration has the meaning given to it in the Merger Implementation Agreement.

Share Scheme Deed Poll means the share scheme deed poll dated [insert date] 2009 executed by Unilife Corporation under which Unilife Corporation covenants in favour of each Scheme Shareholder to perform its obligations under the Merger Implementation Agreement and this Share Scheme.

Share Scheme Meeting has the meaning given to it in the Merger Implementation Agreement.

Sunset Date means 5.00pm on 30 June 2010 or such other date and time agreed in writing between the Company and Unilife Corporation.

Unilife Corporation means Unilife Corporation, a corporation incorporated under the laws of the state of Delaware, United States of America.

Unilife Corporation Shares means shares of fully paid common stock in the capital of Unilife Corporation.

Interpretation

9.2 In the interpretation of this Share Scheme, the following provisions apply unless the context otherwise requires:

	9.2.1		The singular includes the plural and conversely.
	9.2.2		A gender includes all genders.
	9.2.3		If a word or phrase is defined, its other grammatical forms have a corresponding meaning.
	9.2.4		A reference to a person, corporation, trust, partnership, unincorporated body or other entity includes any of them.
	9.2.5		A reference to a clause, schedule or annexure is a reference to a clause of, or schedule or annexure to, this Share Scheme.
	9.2.6		A reference to an agreement or document (including a reference to this Share Scheme) is to the agreement or document as amended, varied, supplemented, novated or replaced, except to the extent prohibited by this Share Scheme or that other agreement or document.

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9.2.7 A reference to a person includes a reference to the person’s executors, administrators, successors, substitutes (including persons taking by novation) and assigns.

9.2.8 A reference to legislation or to a provision of legislation includes a modification or re-enactment of it, a legislative provision substituted for it and a regulation or statutory instrument issued under it.

9.2.9 A reference to $ is to the lawful currency of Australia.

9.2.10 Words and phrases not specifically defined in this Share Scheme have the same meanings (if any) given to them in the Corporations Act.

9.2.11 A reference to time is a reference to time in Sydney, Australia.

9.2.12 If the day on which any act, matter or thing is to be done is a day other than a Business Day, such act, matter or thing must be done on the immediately succeeding Business Day.

9.2.13 The meaning of general words is not limited by specific examples introduced by including, or for example, or similar expressions.

9.2.14 A reference to a party using its best endeavours or reasonable endeavours does not include a reference to that party paying money or providing other valuable consideration to or for the benefit of any person (and an obligation on a party to use its best or reasonable endeavours does not oblige that party to pay money or provide other valuable consideration to or for the benefit of any person).

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Annexure 2 Option Scheme of Arrangement

000 Xxxxxxxxx Xxxxxxx
Xxxxxx XXX 0000
Xxxxxxxxx
DX 000 Xxxxxx
Tel x00 0 0000 0000
Fax x00 0 0000 0000
xxx.xxxxxxxxxxxxxx.xxx

Option Scheme of Arrangement

Unilife Medical Solutions Limited
The holders of options granted under the Unilife Medical
Solutions Limited Employee Share Option Plan

DLA Xxxxxxxx Fox is a member of

DLA Piper Group, an alliance of

independent legal practices. It is a

separate and distinct legal entity.

DLA Xxxxxxxx Xxx offices are located

in Adelaide Auckland Brisbane

Canberra Melbourne Perth Sydney
and Wellington.

Table of contents

Operative provisions			1
1 Preliminary			1
The Company			1
Effect of Option Scheme			1
Merger Implementation Agreement and Option Scheme Deed Poll			2
2 Conditions precedent			2
Conditions precedent to Option Scheme			2
Certificate in relation to conditions precedent			2
Lapse of Option Scheme			3
3 Implementation of Option Scheme			3
Lodgement of Court order			3
Provision of Option Scheme Consideration			3
Cancellation of Options			3
Waiver of accelerated vesting and exercise rights			3
Invitation to Optionholders			3
4 Provision of Option Scheme Consideration			4
Provision of Option Scheme Consideration			4
Terms of New Options			4
Fractional entitlements			4
Obligations of Scheme Optionholders			4
General			4
5 Exercise of Options			5
Issue of Options			5
Maintenance of the Option Register			5
Effect of Option Register			5
Information to be made available to Unilife Corporation			5
6 General Option Scheme provisions			6
Appointment of the Company as agent and attorney			6
Option Scheme alterations and conditions			6
Enforcement of Option Scheme Deed Poll			6
Effect of Option Scheme			6
Notices			6
Further assurances			6
Costs and stamp duty			6
7 Governing law and jurisdiction			7

Option Scheme of Arrangement
pursuant to section 411 of the Corporations Xxx 0000 (Cth)

Unilife Medical Solutions Limited ABN 14 000 000 000 of Suite 3, Xxxxx 00, 0 Xxxxxxx Xxxxxx, Xxxxxx, XXX 0000 (Company)

The holders of options granted under the Unilife Medical Solutions Limited Employee Share Option Plan

Operative provisions

1 Preliminary

The Company

1.1		The Company is a public company limited by shares, incorporated in Australia and registered in South Australia. Its registered office is at Xxxxx 0, Xxxxx 00, 0 Xxxxxxx Xxxxxx, Xxxxxx, XXX 0000.
1.2		The Company is admitted to the official list of ASX and the Shares are officially quoted on the financial market operated by ASX.
1.3		As at 25 November 2009, 22,575,000 Options were on issue.

Unilife Corporation

1.4		Unilife Corporation is a corporation limited by shares, incorporated in Delaware, United States. Its registered office is at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx, 00000, County of New Castle.
1.5		As at 25 November 2009, the authorised capital stock of Unilife Corporation comprised 250,000,000 shares of common stock of US$0.01 par value of which 100 Unilife Corporation Shares were on issue and 50,000,000 shares of preferred stock of $US0.01 par value which none were on issue.

Effect of Option Scheme

1.6 If this Option Scheme becomes Effective:

	1.6.1		Unilife Corporation will provide the Option Scheme Consideration to each Scheme Optionholder in accordance with the terms of this Option Scheme;
	1.6.2		all of the Scheme Options will be cancelled; and
	1.6.3		Unilife Corporation will enter the name of each Scheme Optionholder in the Unilife Corporation Option Register in accordance with the terms of this Option Scheme.

1

Merger Implementation Agreement and Option Scheme Deed Poll

1.7		The Company and Unilife Corporation have entered into the Merger Implementation Agreement which sets out the terms on which the Company and Unilife Corporation have agreed to implement this Option Scheme.
1.8		Unilife Corporation has executed the Option Scheme Deed Poll in favour of each Scheme Optionholder pursuant to which it has covenanted to perform its obligations under the Merger Implementation Agreement and this Option Scheme, including to provide the Option Scheme Consideration to Scheme Optionholders.
2		Conditions precedent

Conditions precedent to Option Scheme

2.1 This Option Scheme is conditional on:

	2.1.1		as at 8.00am on the Second Court Hearing Date, the Merger Implementation Agreement not having been terminated in accordance with its terms;
	2.1.2		all of the conditions precedent set out in clause 2.2 of the Merger Implementation Agreement having been satisfied or waived in accordance with the terms of that agreement;
	2.1.3		the Court having approved this Option Scheme, with or without modification, pursuant to section 411(4)(b) of the Corporations Act; and
	2.1.4		such other conditions made or required by the Court pursuant to section 411(6) of the Corporations Act in relation to this Option Scheme as are acceptable to the Company and Unilife Corporation having been satisfied,

and the provisions of clauses 3 to 6 will not come into effect unless and until each of these conditions precedent has been satisfied.

Certificate in relation to conditions precedent

2.2		On the Second Court Hearing Date, the Company and Unilife Corporation will each provide to the Court a certificate confirming whether or not all of the conditions precedent set out in clause 2.2 of the Merger Implementation Agreement (other than in relation to this Option Scheme and the Share Scheme being approved by the Court pursuant to section 411(4)(b) of the Corporations Act) have been satisfied or waived in accordance with the terms of that agreement.
2.3		The giving of a certificate by each of the Company and Unilife Corporation under clause 2.2 will, in the absence of manifest error, be conclusive evidence of the satisfaction or waiver of the conditions precedent referred to in the certificate.

2

Lapse of Option Scheme

2.4		This Option Scheme will lapse and be of no further force or effect if the Effective Date has not occurred on or before the Sunset Date.
3		Implementation of Option Scheme

Lodgement of Court order

3.1 On or before 5.00pm on the first Business Day following approval of this Option Scheme by the Court pursuant to section 411(4)(b) of the Corporations Act, the Company will lodge with ASIC an office copy of the Court order approving this Option Scheme.

Provision of Option Scheme Consideration

3.2 On the Implementation Date, in consideration for the Scheme Optionholders agreeing to the cancellation of the Scheme Options, Unilife Corporation must provide the Option Scheme Consideration to each Scheme Optionholder in accordance with clause 4.

Cancellation of Options

3.3 On the Implementation Date, in consideration for and immediately following the issue of the Option Scheme Consideration in accordance with clause 4:

	3.3.1		all of the Scheme Options (together with all rights and entitlements attaching to the Scheme Options) will be cancelled; and
	3.3.2		the Company will record in its Option Register the cancellation of all of the Scheme Options.

Waiver of accelerated vesting and exercise rights

3.4 Each Scheme Optionholder waives any rights he or she may have under section 7.3 of the Employee Share Option Plan to the waiver of performance hurdles required to be met for exercise of his or her Options and waives all and any rights to exercise Options at a date earlier than the date on which the Option vests as determined by the Plan Committee as a result of the occurrence of a Change of Control Event as defined in the Employee Share Option Plan.

Invitation to Optionholders

3.5 It is agreed that this Option Scheme shall constitute an Offer (as defined in the Unilife Corporation Employee Stock Option Plan) to Optionholders to subscribe for Unilife Corporation Options upon the terms set out in clause 4 of this Option Scheme, except that the Grant Date (as such term is defined in the Unilife Corporation Employee Stock Option Plan) for Unilife Corporation Options shall be the date that Options were issued to Optionholders pursuant to the Employee Share Option Plan and:

	3.5.1		the term “Last Exercise Date” in the Unilife Corporation Employee Stock Option Plan; and
	3.5.2		the Exercise Period referred to in the Unilife Corporation Employee Stock Option Plan,

shall each be construed accordingly.

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4 Provision of Option Scheme Consideration

Provision of Option Scheme Consideration

4.1 The obligation of Unilife Corporation to provide the Option Scheme Consideration will be satisfied on the Implementation Date by the Company procuring that Unilife Corporation, in accordance with its covenant in favour of Scheme Optionholders contained in clause 2.2 of the Option Scheme Deed Poll, issues to such Scheme Optionholder one Unilife Corporation Options for every six Scheme Options held by them on the Scheme Record Date.

Terms of New Options

4.2 Each Unilife Corporation Option issued pursuant to this Option Scheme will be issued on the terms set out in Annexure A.

Fractional entitlements

4.3 Fractional entitlements to Option Scheme Consideration will be rounded down to the nearest whole number of Unilife Corporation Options after aggregating all holdings of such Scheme Optionholder.

Obligations of Scheme Optionholders

4.4 Each Scheme Optionholder who will be issued with Unilife Corporation Options under the Option Scheme agrees:

	4.4.1		That this Option Scheme constitutes his/her acceptance of an offer of the Unilife Corporation Options for the purposes of clause 5.1 and 6.2 of the Unilife Corporation Employee Stock Option Plan;
	4.4.2		to become an optionholder of Unilife Corporation;
	4.4.3		to have their name and address entered into the register of optionholders maintained by Unilife Corporation; and
	4.4.4		to be bound by the Certificate of Incorporation and by-laws of Unilife Corporation as in force from time to time in respect of the Unilife Corporation Options.

General

4.5 The obligation of the Company to procure Unilife Corporation to issue Unilife Corporation Options under clause 4.1 of this Option Scheme will be satisfied by Unilife Corporation on the Implementation Date, procuring the entry in the Unilife Corporation’s Option Register of each person who is to receive Unilife Corporation Options.

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4.6 After the satisfaction of the obligation of the Company in clause 4.4, and within five Business Days after the Implementation Date, the Company will procure Unilife Corporation to:

	4.6.1		issue certificates for such Unilife Corporation Options in the name of such persons; and
	4.6.2		procure the dispatch of such certificates to the address as shown in the register for such persons.

5 Exercise of Options

Issue of Options

5.1		The Company will issue Shares in accordance with any valid exercise of an Option which is received on or before 12.00 noon on the Business Day prior to the Scheme Record Date.
5.2		The Company will not accept for registration or recognise for any purpose any exercise of an Option received after 12.00 noon on the Business Day before the Scheme Record Date and, after such time, the Options shall not be capable of exercise notwithstanding any terms on which such Options were granted.

Maintenance of the Option Register

5.3 For the purpose of determining entitlements to the Option Scheme Consideration, the Company will, until the Option Scheme Consideration has been provided, maintain or procure the maintenance of the Option Register in accordance with this clause 5. The Option Register in this form will solely determine entitlements to the Option Scheme Consideration.

Effect of Option Register

5.4 After the Scheme Record Date, all option certificates for the Scheme Options and each entry in the Option Register as at the Scheme Record Date will cease to have any effect, except as evidence of entitlements to Option Scheme Consideration under this Option Scheme.

Information to be made available to Unilife Corporation

5.5 The Company will procure that, as soon as reasonably practicable after the Scheme Record Date, details of the names, registered addresses and holdings of Options of every Scheme Optionholder as shown in the Option Register at the Scheme Record Date are made available to Unilife Corporation in such form as Unilife Corporation reasonably requires.

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6 General Option Scheme provisions

Appointment of the Company as agent and attorney

6.1 Each Scheme Optionholder, without the need for any further act, irrevocably appoints the Company and each of the directors and officers of the Company, jointly and severally, as its attorney and agent for the purpose of doing all things necessary including executing all deeds, instruments, and other documents as may be necessary or desirable to give full effect to this Option Scheme and the transactions contemplated by it.

Option Scheme alterations and conditions

6.2 If the Court proposes to approve this Option Scheme subject to any alterations or conditions, the Company may, by its counsel or solicitors, and with the consent of Unilife Corporation, consent to those alterations or conditions on behalf of all persons concerned, including, for the avoidance of doubt, all Scheme Optionholders.

Enforcement of Option Scheme Deed Poll

6.3 The Company undertakes in favour of each Scheme Optionholder to enforce the Option Scheme Deed Poll against Unilife Corporation on behalf of and as agent and attorney for the Scheme Optionholders

Effect of Option Scheme

6.4 This Option Scheme binds the Company and all Scheme Optionholders (including those who do not attend the Option Scheme Meeting, do not vote at the Option Scheme Meeting or vote against the Option Scheme) and, to the extent of any inconsistency and to the extent permitted by law, overrides the constitution of the Company.

Notices

6.5 Where a notice, transfer, transmission application, direction or other communication referred to in this Option Scheme is sent by post to the Company, it will not be deemed to be received in the ordinary course of post or on a date other than the date (if any) on which it is actually received at the Company’s registered office or at the place where the Option Register is kept.

Further assurances

6.6 The Company will execute all deeds, instruments, transfers and other documents and do all acts and things (on its own behalf and on behalf of each Scheme Optionholder) as may be necessary or desirable to give full effect to this Option Scheme and the transactions contemplated by it.

Costs and stamp duty

6.7 Subject to the terms of the Merger Implementation Agreement, the Company will pay the costs of the Option Scheme.

6

7 Governing law and jurisdiction

7.1		This Option Scheme is governed by the laws of New South Wales, Australia.
7.2		Each party irrevocably and unconditionally:

	7.2.1		submits to the non-exclusive jurisdiction of the courts of New South Wales; and
	7.2.2		waives, without limitation, any claim or objection based on absence of jurisdiction or inconvenient forum.

8 Definitions and Interpretation

Definitions

8.1		In this Option Scheme, unless the context requires otherwise:
		ASIC means the Australian Securities and Investments Commission.
		ASX means ASX Limited ABN 98 008 624 691 or the securities market it operates, as the context requires.
		Business Day means a day that is not a Saturday, Sunday, public holiday or bank holiday in Sydney.
		Corporations Act means the Corporations Xxx 0000 (Cth).
		Court means the Federal Court of Australia or any other court of competent jurisdiction under the Corporations Act agreed in writing by the Company and Unilife Corporation.
		Effective means, when used in relation to this Option Scheme, the coming into effect, pursuant to section 411(10) of the Corporations Act, of the order of the Court made for the purposes of section 411(4)(b) of the Corporations Act in relation to this Option Scheme, but in any event at no time before an office copy of the order of the Court is lodged with ASIC.
		Effective Date means the date on which this Option Scheme becomes Effective.
		Employee Share Option Plan means the Unilife Medical Solutions Limited Employee Share Option Plan.
		Implementation Date means the third Business Day after the Scheme Record Date.
		Information Memorandum means the document containing the information described in clause 6.2.1 of the Merger Implementation Agreement to be approved by the Court and to be despatched to Optionholders.
		Merger Implementation Agreement means the Merger Implementation Agreement dated 1 September 2009 between the Company and Unilife Corporation.

7

Options means options entitling holders to subscribe for Shares, issued under the Employee Share Option Plan.

Option Register means the register of optionholders of the Company maintained by or on behalf of the Company in accordance with the Corporations Act.

Option Scheme means this scheme of arrangement under Part 5.1 of the Corporations Act between the Company and Scheme Optionholders, subject to any alterations or conditions made or required by the Court pursuant to section 411(6) of the Corporations Act.

Option Scheme Consideration has the meaning given to it in the Merger Implementation Agreement.

Option Scheme Deed Poll means the option scheme deed poll dated [insert date] 2009 executed by Unilife Corporation under which Unilife Corporation covenants in favour of each Scheme Optionholder to perform its obligations under the Merger Implementation Agreement and this Option Scheme.

Option Scheme Meeting has the meaning given to it in the Merger Implementation Agreement.

Optionholder means a person who is registered in the Option Register as a holder of Options from time to time.

Plan Committee has the meaning given to it in the Employee Share Option Plan.

Related Body Corporate has the meaning given to that term in section 50 of the Corporations Act.

Scheme Option means an Option held by a Scheme Optionholder at the Scheme Record Date.

Scheme Optionholder means an Optionholder who is entered into the Option Register as the holder of Options as at the Scheme Record Date.

Scheme Record Date means 7.00pm on the fifth Business Day after the Effective Date or any other date agreed with ASX to be the record date for the Option Scheme to determine entitlements to receive Option Scheme Consideration.

Scheme Shareholder means a Shareholder as at the Scheme Record Date.

Second Court Hearing Date means the first day on which the application made to the Court for an order approving this Option Scheme pursuant to section 411(4)(b) of the Corporations Act is heard, or if the hearing of the application is adjourned for any reason, the first day of the adjourned hearing.

Share means a fully paid ordinary share in the Company

8

Share Scheme means the scheme of arrangement, substantially in the form set out in Annexure 1 to the Merger Implementation Agreement, under Part 5.1 of the Corporations Act between the Company and Scheme Shareholders.

Sunset Date means 5.00pm on 30 June 2010, or such later date and time agreed in writing between the Company and Unilife Corporation.

Unilife Corporation means Unilife Corporation, a corporation incorporated under the laws of the state of Delaware, United States of America.

Unilife Corporation Employee Stock Option Plan means the Unilife Corporation Employee Stock Option Plan adopted by Unilife Corporation on 11 November 2009.

Unilife Corporation Option means an option to subscribe for Unilife Corporation Shares under the Unilife Corporation Employee Stock Option Plan.

Unilife Corporation Option Register means the register of optionholders maintained by or on behalf of Unilife Corporation.

Unilife Corporation Shares means shares of fully paid common stock in the capital of Unilife Corporation.

Interpretation

8.2 In the interpretation of this Option Scheme, the following provisions apply unless the context otherwise requires:

	8.2.1		The singular includes the plural and conversely.
	8.2.2		A gender includes all genders.
	8.2.3		If a word or phrase is defined, its other grammatical forms have a corresponding meaning.
	8.2.4		A reference to a person, corporation, trust, partnership, unincorporated body or other entity includes any of them.
	8.2.5		A reference to a clause, schedule or annexure is a reference to a clause of, or schedule or annexure to, this Option Scheme.
	8.2.6		A reference to an agreement or document (including a reference to this Option Scheme) is to the agreement or document as amended, varied, supplemented, novated or replaced, except to the extent prohibited by this Option Scheme or that other agreement or document.
	8.2.7		A reference to a person includes a reference to the person’s executors, administrators, successors, substitutes (including persons taking by novation) and assigns.

9

	8.2.8		A reference to legislation or to a provision of legislation includes a modification or re-enactment of it, a legislative provision substituted for it and a regulation or statutory instrument issued under it.
	8.2.9		A reference to $ is to the lawful currency of Australia.
	8.2.10		Words and phrases not specifically defined in this Option Scheme have the same meanings (if any) given to them in the Corporations Act.
	8.2.11		A reference to time is a reference to time in Sydney, Australia.
	8.2.12		If the day on which any act, matter or thing is to be done is a day other than a Business Day, such act, matter or thing must be done on the immediately succeeding Business Day.
	8.2.13		The meaning of general words is not limited by specific examples introduced by including, or for example, or similar expressions.
	8.2.14		A reference to a party using its best endeavours or reasonable endeavours does not include a reference to that party paying money or providing other valuable consideration to or for the benefit of any person (and an obligation on a party to use its best or reasonable endeavours does not oblige that party to pay money or provide other valuable consideration to or for the benefit of any person).

10

Annexure A

Terms of Unilife Corporation Options granted under the Unilife Corporation Employee Stock Option Plan

Each Unilife Corporation Option issued pursuant to the Unilife Corporation Employee Stock Option Plan will:

	•		have an exercise price per option equal to six times the exercise price per option of the Options it replaces, provided that such exercise price of Unilife Corporation Option shall be rounded up to the nearest whole cent;
	•		have an exercise period equal to the unexpired exercise period of the Options it replaces;
	•		be vested to the same extent and have the same terms as to vesting as the Options it replaces;
	•		be subject to equivalent performance hurdles (if any) as the Options it replaces; and
	•		otherwise be issued on the terms of the Unilife Corporation Employee Stock Option Plan.

11

Annexure 3 Share Scheme Deed Poll

000 Xxxxxxxxx Xxxxxx

Xxxxxx XXX 0000

Xxxxxxxxx

DX 000 Xxxxxx

Tel x00 0 0000 0000

Fax x00 0 0000 0000

xxx.xxxxxxxxxxxxxx.xxx

Share Scheme Deed Poll

Unilife Corporation
in favour of each Scheme Shareholder

DLA Xxxxxxxx Fox is a member of DLA Piper Group, an alliance of independent legal practices. It is a separate and distinct legal entity.

DLA Xxxxxxxx Xxx offices are located in Adelaide Auckland Brisbane Canberra Melbourne Perth Sydney and Wellington.

Table of contents

Date:
Parties			1
Background			1
Operative provisions			2
1 Conditions and termination			2
Conditions precedent			2
Termination			2
Consequences of termination			2
2 Provision of Share Scheme Consideration			2
Compliance with Share Scheme obligations generally			2
Provision of Share Scheme Consideration			2
3 Representations and warranties			3
4 Continuing obligations			3
5 Notices			3
6 General			4
Stamp duty			4
Waiver			4
Variation			5
Rights cumulative			5
Assignment			5
Further assurances			5
7 Governing law and jurisdiction			5
8 Definitions and Interpretation			6
Definitions			6
Interpretation			6
Nature of Deed Poll			6
Execution and date			7

Share Scheme Deed Poll

Date:

Parties

Unilife Corporation a company incorporated in Delaware, USA of 000 Xxxxxxx Xxxx Xxxxxxxxxx, Xxxxxxxxxxxx, 00000, Xxxxxx Xxxxxx (Unilife Corporation)

In favour of each holder of fully paid ordinary shares in Unilife Medical Solutions Limited ABN 14 000 000 000 (Company) on issue at the Scheme Record Date (Scheme Shareholders)

Background

A		The Company’s board considers that it is in the interests of the Company that Shareholders be given the opportunity to consider and, if thought fit, approve the Share Scheme.
B		Accordingly, the Company’s board has resolved that the Company should propose the Share Scheme.
C		The effect of the Share Scheme will be that all of the Scheme Shares will be transferred to Unilife Corporation in consideration for the issue of Unilife Corporation Shares or CDIs to such Scheme Shareholders.
D		On 1 September 2009, Unilife Corporation and the Company entered into a Merger Implementation Agreement.
E		Under the Merger Implementation Agreement, Unilife Corporation has agreed to take all necessary steps to implement and complete the Share Scheme as soon as is reasonably practicable, including executing this document and providing the Share Scheme Consideration.
F		Unilife Corporation is entering into this document for the purpose of covenanting in favour of Scheme Shareholders to perform its obligations under the Merger Implementation Agreement and the Share Scheme.

1

Share Scheme Deed Poll

Operative provisions

1 Conditions and termination

Conditions precedent

1.1 Unilife Corporation’s obligations under clause 2 are subject to the Share Scheme becoming Effective.

Termination

1.2 Unilife Corporation’s obligations under this document will automatically terminate and the terms of this document will be of no further force or effect if:

	1.2.1		the Merger Implementation Agreement is terminated in accordance with its terms; or
	1.2.2		the Share Scheme does not become Effective on or before the Sunset Date, unless Unilife Corporation and the Company otherwise agree in accordance with the Merger Implementation Agreement.

Consequences of termination

1.3 If this document terminates under clause 1.2, then, in addition and without prejudice to any other rights, powers or remedies available to it:

1.3.1 Unilife Corporation is released from its obligations to further perform this document except those obligations under clause 6.1 and any other obligations which by their nature survive termination; and

1.3.2 Scheme Shareholders retain the rights they have against Unilife Corporation in respect of any breach of this document by Unilife Corporation which occurs before termination.

2 Provision of Share Scheme Consideration

Compliance with Share Scheme obligations generally

2.1 Unilife Corporation will comply with its obligations under the Merger Implementation Agreement and do all acts and things as may be necessary or desirable on its part to perform the acts contemplated of it under the Share Scheme.

Provision of Share Scheme Consideration

2.2 Subject to clause 1, in consideration of the transfer to Unilife Corporation of all of the Scheme Shares, Unilife Corporation will, on the Implementation Date, issue to each Scheme Shareholder (or, in accordance with clause 4.7 of the Share Scheme to a Nominee on its behalf where such Scheme Shareholder is an Ineligible Overseas Shareholder) the Share Scheme Consideration in accordance with clause 4 of the Share Scheme.

2.3 The Unilife Corporation Shares to be issued under the Share Scheme will be validly issued and fully paid and will rank equally in all respects with all other Unilife Corporation Shares on issue as at the Implementation Date.

2

Share Scheme Deed Poll

3		Representations and warranties
3.1		Unilife Corporation represents and warrants that:

	3.1.1		it is a corporation validly existing under the laws of its place of registration;
	3.1.2		it has the corporate power to enter into and perform its obligations under this document and to carry out the transactions contemplated by this document;

3.1.3 it has taken all necessary corporate action to authorise the entry into this document and has taken or will take all necessary corporate action to authorise the performance of this document and to carry out the transactions contemplated by this document; and

3.1.4 this document is valid and binding upon it and enforceable against it in accordance with its terms.

4 Continuing obligations

4.1 This document is irrevocable and, subject to clause 1, remains in full force and effect until:

	4.1.1		Unilife Corporation has fully performed its obligations under this document; or
	4.1.2		the earlier termination of this document under clause 1.2.

5 Notices

5.1 Any notice, demand, consent or other communication (a Notice) given or made under this document:

5.1.1 must be in writing and signed by a person duly authorised by the sender;

5.1.2 must be delivered to the intended recipient by prepaid post or by hand or fax to the address or fax number below or the address (being an address in Australia) or fax number last notified by the intended recipient to the sender:

Unilife Corporation

Address: 000 Xxxxxxx Xxxx
              Xxxxxxxxxx, Xxxxxxxxxxxx 00000

              Xxxxxx Xxxxxx

Fax:       + 0 000 000 0000

Attention: Xxxx Xxxxxxxx

3

Share Scheme Deed Poll

5.1.3 will be taken to be duly given or made:

	(a)		in the case of delivery in person, when delivered;
	(b)		in the case of delivery by post:

(i) within Australia to an Australian address, two Business Days after the date of posting; and

(ii) in any other case, 10 Business Days after the date of posting; and

(c) in the case of fax, on receipt by the sender of a transmission control report from the dispatching machine showing the relevant number of pages and the correct destination fax machine number or name of recipient and indicating that the transmission has been made without error,

but if the result is that a Notice would be taken to be given or made on a day that is not a Business Day in the place to which the Notice is sent or is later than 4.00pm (local time) it will be taken to have been duly given or made at the commencement of business on the next Business Day in that place.

6 General

Stamp duty

6.1 Unilife Corporation will:

6.1.1 pay all stamp duty (including fines, penalties and interest) in respect of this document, the performance of this document and each transaction effected by or made under this document; and

6.1.2 indemnify each Scheme Shareholder against any liability arising from failure to comply with clause 6.1.1.

Waiver

6.2 Waiver of any right arising from a breach of this document or of any right, power, authority, discretion or remedy arising upon default under this document must be in writing and signed by the party granting the waiver.

6.3 A failure or delay in exercise, or partial exercise, of:

	6.3.1		a right arising from a breach of this document; or
	6.3.2		a right, power, authority, discretion or remedy created or arising upon default under this document,

		does not result in a waiver of that right, power, authority, discretion or remedy.
6.4		A party is not entitled to rely on a delay in the exercise or non-exercise of a right, power, authority, discretion or remedy arising from a breach of this document or on a default under this document as constituting a waiver of that right, power, authority, discretion or remedy.

6.5 A party may not rely on any conduct of another party as a defence to exercise of a right, power, authority, discretion or remedy by that other party.

4

Share Scheme Deed Poll

Variation

6.6 A provision of this document may not be amended or varied unless the amendment or variation is agreed to in writing by the Company and the Court indicates that the amendment or variation would not of itself preclude approval of the Share Scheme in which event Unilife Corporation will enter into a further deed poll in favour of each Scheme Shareholder giving effect to the amendment or variation.

Rights cumulative

6.7 The rights, powers and remedies of Unilife Corporation and of each Scheme Shareholder under this document are cumulative and do not exclude any other rights, powers or remedies provided by law independently of this document.

Assignment

6.8 The rights and obligations of Unilife Corporation and of each Scheme Shareholder under this document are personal and must not be assigned, encumbered or otherwise dealt with at law or in equity.

Further assurances

6.9 Unilife Corporation will, at its own expense, execute all deeds and other documents and do all acts and things as may be necessary or desirable to give full effect to this document.

7 Governing law and jurisdiction

7.1		This document is governed by the laws of New South Wales, Australia.
7.2		Unilife Corporation irrevocably and unconditionally:

7.2.1 submits to the non-exclusive jurisdiction of the courts of New South Wales, Australia; and

7.2.2 waives, without limitation, any claim or objection based on absence of jurisdiction or inconvenient forum.

5

Share Scheme Deed Poll

8 Definitions and Interpretation

Definitions

8.1 Terms that are not defined in this document and that are defined in the Merger Implementation Agreement or the Share Scheme have the same meaning in this document, unless the context makes it clear that a definition is not intended to apply.

Interpretation

8.2 Clause 9.2 of the Share Scheme applies to the interpretation of this document except that references to ‘this Share Scheme’ in that clause are to be read as references to ‘this document’.

Nature of Deed Poll

8.3 Unilife Corporation acknowledges that this document may be relied on and enforced by any Scheme Shareholder in accordance with its terms even though the Scheme Shareholders are not party to it.

6

Share Scheme Deed Poll

Execution and date

Executed as a deed poll.

Executed by Unilife Corporation acting by the following persons:

Signature of duly authorised officer		Signature of duly authorised officer
Name of duly authorised officer (print)		Name of duly authorised officer (print)

7

Annexure 4 Option Scheme Deed Poll

000 Xxxxxxxxx Xxxxxx

Xxxxxx XXX 0000

Xxxxxxxxx

DX 000 Xxxxxx

Tel x00 0 0000 0000

Fax x00 0 0000 0000

xxx.xxxxxxxxxxxxxx.xxx

Option Scheme Deed Poll

Unilife Corporation

in favour of each Scheme Optionholder

DLA Xxxxxxxx Fox is a member of

DLA Piper Group, an alliance of

independent legal practices. It is a

separate and distinct legal entity.

DLA Xxxxxxxx Xxx offices are located

in Adelaide Auckland Brisbane Canberra

Melbourne Perth Sydney and Wellington.

Table of contents

Parties			1
Background			1
Operative provisions			1
1 Conditions and termination			1
Conditions precedent			1
Termination			2
Consequences of termination			2
2 Provision of Option Scheme Consideration			2
Compliance with Option Scheme obligations generally			2
Provision of Option Scheme Consideration			2
3 Representations and warranties			2
4 Continuing obligations			3
5 Notices			3
6 General			4
Stamp duty			4
Waiver			4
Variation			5
Rights cumulative			5
Assignment			5
Further assurances			5
7 Governing law and jurisdiction			5
8 Definitions and Interpretation			5
Definitions			5
Interpretation			5
Nature of Deed Poll			5
Execution and date			6

Option Scheme Deed Poll

Parties

Unilife Corporation a company incorporated in Delaware, USA, of 000, Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000, Xxxxxx Xxxxxx, (Unilife Corporation)

In favour of each holder of options to subscribe for fully paid ordinary shares in Unilife Medical Solutions Limited ABN 14 000 000 000 (Company) granted under the Unilife Medical Solutions Limited Employee Share Option Plan as at the Scheme Record Date (Scheme Optionholders)

Background

A		The Company’s board considers that it is in the interests of the Company that Optionholders be given the opportunity to consider and, if thought fit, approve the Option Scheme.
B		Accordingly, the Company’s board has resolved that the Company should propose the Option Scheme.
C		The effect of the Option Scheme will be that all of the Scheme Options will be cancelled in consideration for the issue of Unilife Corporation Options by Unilife Corporation to such Scheme Optionholders.
D		On 1 September 2009, Unilife Corporation and the Company entered into a Merger Implementation Agreement.
E		Under the Merger Implementation Agreement, Unilife Corporation has agreed to take all necessary steps to implement and complete the Option Scheme as soon as is reasonably practicable, including executing this document and providing the Option Scheme Consideration.
F		Unilife Corporation is entering into this document for the purpose of covenanting in favour of Scheme Optionholders to perform its obligations under the Merger Implementation Agreement and the Option Scheme.

Operative provisions

1 Conditions and termination

Conditions precedent

1.1 Unilife Corporation’s obligations under clause 2 are subject to the Option Scheme becoming Effective.

1

Option Scheme Deed Poll

Termination

1.2 Unilife Corporation’s obligations under this document will automatically terminate and the terms of this document will be of no further force or effect if:

1.2.1 the Merger Implementation Agreement is terminated in accordance with its terms; or

1.2.2 the Option Scheme does not become Effective on or before the Sunset Date,

unless Unilife Corporation and the Company otherwise agree in accordance with the Merger Implementation Agreement.

Consequences of termination

1.3 If this document terminates under clause 1.2, then, in addition and without prejudice to any other rights, powers or remedies available to it:

1.3.1 Unilife Corporation is released from its obligations to further perform this document except those obligations under clause 6.1 and any other obligations which by their nature survive termination; and

1.3.2 Scheme Optionholders retain the rights they have against Unilife Corporation in respect of any breach of this document by Unilife Corporation which occurs before termination.

2 Provision of Option Scheme Consideration

Compliance with Option Scheme obligations generally

2.1 Unilife Corporation will comply with its obligations under the Merger Implementation Agreement and do all acts and things as may be necessary or desirable on its part to perform the acts contemplated of it under the Option Scheme.

Provision of Option Scheme Consideration

2.2 Subject to clause 1, in consideration for the Scheme Optionholders agreeing to the cancellation of their Scheme Options, Unilife Corporation will, on the Implementation Date, issue to each Scheme Optionholder the Option Scheme Consideration in accordance with clause 4 of the Option Scheme.

3 Representations and warranties

3.1 Unilife Corporation represents and warrants that:

	3.1.1		it is a corporation validly existing under the laws of its place of registration;
	3.1.2		it has the corporate power to enter into and perform its obligations under this document and to carry out the transactions contemplated by this document;

3.1.3 it has taken all necessary corporate action to authorise the entry into this document and has taken or will take all necessary corporate action to authorise the performance of this document and to carry out the transactions contemplated by this document; and

3.1.4 this document is valid and binding upon it and enforceable against it in accordance with its terms.

2

Option Scheme Deed Poll

4 Continuing obligations

4.1 This document is irrevocable and, subject to clause 1, remains in full force and effect until:

	4.1.1		Unilife Corporation has fully performed its obligations under this document; or
	4.1.2		the earlier termination of this document under clause 1.2.

5 Notices

5.1 Any notice, demand, consent or other communication (a Notice) given or made under this document:

5.1.1 must be in writing and signed by a person duly authorised by the sender;

5.1.2 must be delivered to the intended recipient by prepaid post or by hand or fax to the address or fax number below or the address (being an address in Australia) or fax number last notified by the intended recipient to the sender:

Unilife Corporation
Address:		000 Xxxxxxx Xxxx
		Xxxxxxxxxx, Xxxxxxxxxxxx 00000
		Xxxxxx Xxxxxx
Fax:		+ 0 000 000 0000
Attention:		Xxxx Xxxxxxxx

5.1.3 will be taken to be duly given or made:

(a) in the case of delivery in person, when delivered;

(b) in the case of delivery by post:

(i) within Australia to an Australian address, two Business Days after the date of posting; and

(ii) in any other case, 10 Business Days after the date of posting; and

3

Option Scheme Deed Poll

(c) in the case of fax, on receipt by the sender of a transmission control report from the dispatching machine showing the relevant number of pages and the correct destination fax machine number or name of recipient and indicating that the transmission has been made without error,

but if the result is that a Notice would be taken to be given or made on a day that is not a Business Day in the place to which the Notice is sent or is later than 4.00pm (local time) it will be taken to have been duly given or made at the commencement of business on the next Business Day in that place.

6 General

Stamp duty

6.1 Unilife Corporation will:

6.1.1 pay all stamp duty (including fines, penalties and interest) in respect of this document, the performance of this document and each transaction effected by or made under this document; and

6.1.2 indemnify each Scheme Optionholder against any liability arising from failure to comply with clause 6.1.1.

Waiver

6.2 Waiver of any right arising from a breach of this document or of any right, power, authority, discretion or remedy arising upon default under this document must be in writing and signed by the party granting the waiver.

6.3 A failure or delay in exercise, or partial exercise, of:

6.3.1 a right arising from a breach of this document; or

6.3.2 a right, power, authority, discretion or remedy created or arising upon default under this document,

does not result in a waiver of that right, power, authority, discretion or remedy.

6.4 A party is not entitled to rely on a delay in the exercise or non-exercise of a right, power, authority, discretion or remedy arising from a breach of this document or on a default under this document as constituting a waiver of that right, power, authority, discretion or remedy.

6.5 A party may not rely on any conduct of another party as a defence to exercise of a right, power, authority, discretion or remedy by that other party.

4

Option Scheme Deed Poll

Variation

6.6 A provision of this document may not be amended or varied unless the amendment or variation is agreed to in writing by the Company and the Court indicates that the amendment or variation would not of itself preclude approval of the Option Scheme in which event Unilife Corporation will enter into a further deed poll in favour of each Scheme Optionholder giving effect to the amendment or variation.

Rights cumulative

6.7 The rights, powers and remedies of Unilife Corporation and of each Scheme Optionholder under this document are cumulative and do not exclude any other rights, powers or remedies provided by law independently of this document.

Assignment

6.8 The rights and obligations of Unilife Corporation and of each Scheme Optionholder under this document are personal and must not be assigned, encumbered or otherwise dealt with at law or in equity.

Further assurances

6.9 Unilife Corporation will, at its own expense, execute all deeds and other documents and do all acts and things as may be necessary or desirable to give full effect to this document.

7 Governing law and jurisdiction

7.1		This document is governed by the laws of New South Wales, Australia.
7.2		Unilife Corporation irrevocably and unconditionally:

7.2.1 submits to the non-exclusive jurisdiction of the courts of New South Wales, Australia; and

7.2.2 waives, without limitation, any claim or objection based on absence of jurisdiction or inconvenient forum.

8 Definitions and Interpretation

Definitions

8.1 Terms that are not defined in this document and that are defined in the Merger Implementation Agreement or the Option Scheme have the same meaning in this document, unless the context makes it clear that a definition is not intended to apply.

Interpretation

8.2 Clause 8.2 of the Option Scheme applies to the interpretation of this document except that references to ‘this Option Scheme’ in that clause are to be read as references to ‘this document’.

Nature of Deed Poll

8.3 Unilife Corporation acknowledges that this document may be relied on and enforced by any Scheme Optionholder in accordance with its terms even though the Scheme Optionholders are not party to it.

5

Option Scheme Deed Poll

Execution and date

Executed as a deed poll.

Executed by Unilife Corporation acting by the following persons:

Signature of director		Signature of director/company secretary
Name of director (print)		Name of director/company secretary (print)

6