As filed with the Securities and Exchange Commission on July 17, 2019
Registration No. 333-232393
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 3
to
FORM S-1
REGISTRATION STATEMENT
Under
The Securities Act of 1933
Sunnova Energy International Inc.
(Exact name of Registrant as specified in its charter)
| Delaware | 4931 | 30-1192746 | ||
| (State or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Number) |
20 East Greenway Plaza, Suite 475
Houston, Texas 77046
(281) 985-9904
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Walter A. Baker
Executive Vice President, General Counsel and Secretary
Sunnova Energy International Inc.
20 East Greenway Plaza, Suite 475
Houston, Texas 77046
(281) 985-9904
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
| Joshua Davidson Travis J. Wofford Baker Botts L.L.P. 910 Louisiana Street Houston, TX 77002 (713) 229-1234 |
David P. Oelman E. Ramey Layne Vinson & Elkins L.L.P. 1001 Fannin Street Houston, TX 77002 (713) 758-2222 |
Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box: ☐
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
| Non-accelerated filer | ☒ | Smaller reporting company | ☐ | |||
| Emerging growth company | ☒ | |||||
If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☒
CALCULATION OF REGISTRATION FEE
|
| ||||||||
| Title of each Class of Securities to be Registered |
Shares to be Registered(1) |
Proposed Offering Price |
Maximum Offering Price(1)(2) |
Amount of Registration Fee(3) | ||||
| Common Stock, $0.0001 par share |
20,294,118 |
$18.00 | $365,294,124 | $44,274 | ||||
|
| ||||||||
|
| ||||||||
| (1) | Includes an additional 2,647,059 shares of our common stock that the underwriters have the option to purchase. |
| (2) | Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(a) of the Securities Act of 1933, as amended. |
| (3) | The registrant previously paid $12,120 of this amount in connection with a prior filing of this registration statement. |
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
EXPLANATORY NOTE
This Amendment No. 3 is being filed for the purpose of refiling Exhibits 3.7 and 10.26 to the Registration Statement (File No. 333-232393) with different exhibit numbers. No changes or additions are being made hereby to the Prospectus constituting Part I of the Registration Statement (not included herein) or to Items 13, 14, 15 or 17 of Part II of this Registration Statement.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all expenses to be paid by the Registrant, other than underwriting discounts and commissions, upon the completion of this offering. All amounts shown are estimates except for the SEC registration fee, the FINRA filing fee and the NYSE listing fee.
| Amount |
||||
| SEC registration fee |
$ | 46,000 | ||
| FINRA filing fee |
225,500 | |||
| NYSE listing fee |
295,000 | |||
| Printing and engraving expenses |
525,000 | |||
| Legal fees and expenses |
3,035,000 | |||
| Accounting fees and expenses |
1,277,000 | |||
| Transfer agent and registrar fees |
10,000 | |||
| Miscellaneous expenses |
987,000 | |||
|
|
|
|||
| Total |
$6,400,500 | |||
|
|
|
|||
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the DGCL provides that a corporation may indemnify any person who was or is a party, or is threatened to be made a party, to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise), against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. A similar standard is applicable in the case of derivative actions (i.e., actions by or in the right of the corporation), except that indemnification extends only to expenses, including attorneys’ fees, incurred in connection with the defense or settlement of such action and the statute requires court approval before there can be any indemnification where the person seeking indemnification has been found liable to the corporation.
Our new amended and restated certificate of incorporation and bylaws will contain provisions that limit the liability of our directors and officers for monetary damages to the fullest extent permitted by the DGCL. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director, except liability:
| • | for any breach of the director’s duty of loyalty to our company or our stockholders; |
| • | for any act or omission not in good faith or that involve intentional misconduct or knowing violation of law; |
| • | under Section 174 of the DGCL regarding unlawful dividends and stock purchases; or |
| • | for any transaction from which the director derived an improper personal benefit. |
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| • | under Section 174 of the DGCL regarding unlawful dividends and stock purchases; or |
| • | for any transaction from which the director derived an improper personal benefit. |
Any amendment to, or repeal of, these provisions will not eliminate or reduce the effect of these provisions in respect of any act, omission or claim that occurred or arose prior to that amendment or repeal. If the DGCL is amended to provide for further limitations on the personal liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent permitted by the DGCL.
We have entered into or will enter into separate indemnification agreements with each of our directors and officers that provide the maximum indemnity allowed to directors and executive officers by Section 145 of the Delaware General Corporation Law and also to provide for certain additional procedural protections. We believe that these agreements and insurance policies are necessary to attract and retain qualified individuals to serve as directors and executive officers.
These indemnification provisions and the indemnification agreements entered into between the Registrant and its officers and directors may be sufficiently broad to permit indemnification of the Registrant’s officers and directors for liabilities (including reimbursement of expenses incurred) arising under the Securities Act of 1933, as amended (Securities Act).
We intend to maintain liability insurance policies that indemnify our directors and officers against various liabilities, including certain liabilities under arising under the Securities Act and the Exchange Act, which may be incurred by them in their capacity as such.
The proposed form of underwriting agreement to be filed as Exhibit 1.1 to this registration statement will provide for indemnification by the underwriters of the Registrant and its officers and directors for certain liabilities arising under the Securities Act or otherwise.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling our company pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
Since January 1, 2016, Sunnova Energy Corporation has issued the following unregistered securities. Sunnova Energy Corporation believed the offers, sales, and issuances of the below securities were exempt from registration under the Securities Act by virtue of Section 4(a)(2) of the Securities Act because the issuance of securities to the recipients did not involve a public offering, Section 3(a)(9) of the Securities Act because the issuance involved existing security holders exclusively where no commission or other remuneration was paid or given directly or indirectly for soliciting such exchange, or Rule 701 promulgated under Section 3(b) of the Securities Act as transactions by an issuer pursuant to benefit plans and contracts relating to compensation as provided under Rule 701. The recipients of the securities in each of these transactions represented their intentions to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof.
Preferred Stock Issuances
In March 2016, we entered into a purchase and exchange agreement pursuant to which we issued an aggregate of 104,851,119 shares of our Series A convertible preferred stock between March 2016 and December 2017. Pursuant to that agreement, we issued 56,341,483 shares of Series A convertible preferred stock at a purchase price of approximately $5.32 per share for an aggregate purchase price of $300.0 million, we issued
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preferred stock and the Capital Stock Conversions, please read the section entitled “Description of Our Capital Stock—Series A Convertible Preferred Stock” and “Corporate Reorganization.”
From November 2017 through January 2018, Sunnova Energy Corporation sold an aggregate of 10,723,861 shares of its Series B convertible preferred stock to accredited investors at a purchase price of $3.73 per share, for an aggregate purchase price of $40.0 million.
From March 2018 through November 2018, Sunnova Energy Corporation sold an aggregate of 30,344,827 shares of its Series C convertible preferred stock to accredited investors at a purchase price of $5.80 per share, for an aggregate purchase price of $176.0 million.
Exchanges of Preferred Stock
On March 16, 2016, all outstanding shares of Sunnova Energy Corporation’s Series A preferred stock and Series B preferred stock were exchanged for an aggregate of 16,315,880 newly issued shares of Sunnova Energy Corporation’s Series A convertible preferred stock.
On March 29, 2018, all outstanding shares of Sunnova Energy Corporation’s Series B convertible preferred stock were exchanged for an aggregate 11,112,285 newly issued shares of Sunnova Energy Corporation’s Series A convertible preferred stock.
Conversion of Preferred Stock to Common Stock
Immediately prior to or contemporaneously with the completion of this offering, the Registrant will issue approximately 60,474,816 shares of its common stock upon conversion of outstanding shares of convertible Series A preferred stock and Series C preferred stock.
Option Grants and Common Stock Issuances
Since January 1, 2016, Sunnova Energy Corporation has granted to its officers, employees and consultants options to purchase an aggregate of 13,744,791 shares of its common stock under its equity compensation plans at exercise prices ranging from approximately $5.33 to $11.64 per share.
Since January 1, 2016, Sunnova Energy Corporation has issued and sold to its officers, employees and consultants an aggregate of 54,918 shares of its common stock upon the exercise of options under its equity compensation plans at an exercise price of $0.79 per share, for aggregate consideration of approximately $50,000.
Senior Convertible Notes
On April 24, 2017, Sunnova Energy Corporation issued and sold an aggregate principal amount of $80.0 million of our 12.00% senior secured notes in a private placement to a total of three institutional accredited investors for an aggregate purchase price of $78.4 million. In May 2018 and January 2019, the terms of these senior secured notes were amended to extend the maturity date from October 2018 to January 2019 and from January 2019 to July 2019, respectively. In April 2019, the terms of the remaining $44.9 million aggregate principal amount of these senior secured notes were amended so that, among other things, (i) the interest rate on the notes decreased from 12.00% per annum to 9.50% per annum, (ii) the maturity date was extended from July 2019 to March 2021 and (iii) a conversion feature was added such that the notes will be convertible into common stock, in full, following an initial public offering by us of at least $225.0 million in gross proceeds or, up to 50% of such notes will be convertible into common stock, following an initial public offering by us of less than $225.0 million in gross proceeds; provided that we have converted the full amount of the 2019 subordinated convertible note to equity in connection with this offering. In June 2019, the terms of these senior convertible notes were amended to permit the Subordinated Convertible Notes Issuance.
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On July 8, 2019, all of the holders of the senior convertible notes agreed to irrevocably waive their right to convert their respective senior secured notes into common stock in connection with this offering. We expect that all of the senior convertible notes will be redeemed with a portion of the net proceeds of this offering. We expect the aggregate redemption price for all of the senior convertible notes would be approximately $56.8 million (which includes a premium of $11.4 million based on the midpoint of the price range set forth on the cover of this prospectus) plus a cash payment equal to accrued and unpaid cash interest and pay-in-kind interest to the date of redemption.
Subordinated Convertible Notes
In August 2017, Sunnova Energy Corporation issued a convertible note for $15.0 million to Energy Capital Partners, which is subordinated to Sunnova Energy Corporation’s senior secured notes, with a maturity date of the earlier of (a) the repayment of Sunnova Energy Corporation’s senior secured notes or (b) November 2018. This subordinated convertible note was terminated in October 2017.
In March 2018, Sunnova Energy Corporation issued a convertible note for $15.0 million to Energy Capital Partners, which is subordinated to Sunnova Energy Corporation’s senior convertible notes, with a maturity date of the earlier of (a) the repayment of Sunnova Energy Corporation’s senior convertible notes or (b) May 2019. In January 2019, the terms of this subordinated convertible note were amended to extend the maturity date from May 2019 to December 2019.
In June 2019, Sunnova Energy Corporation issued a subordinated convertible note for $15.0 million to certain of its existing stockholders, including Energy Capital Partners, which is subordinated to Sunnova Energy Corporation’s senior convertible notes and ranks equally with the 2019 subordinated convertible note, with a maturity date of the earlier of (a) the repayment of Sunnova Energy Corporation’s senior convertible notes or (b) December 2021.
We expect that, immediately prior to or contemporaneously with the completion of this offering, Energy Capital Partners will exercise its right to convert the principal amount of the subordinated convertible note plus any accrued and unpaid interest as of the date of conversion into shares of Series A convertible preferred stock, which in turn will convert into approximately 1,420,419 shares of common stock in the Preferred Stock Conversions.
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ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
The exhibits and financial statement schedules filed as part of this registration statement are as follows:
(a) Exhibits.
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| * | To be filed by amendment. |
| + | Indicates management contract or compensatory plan. |
| ¥ | Portions of this exhibit have been omitted. |
| # | Previously filed. |
(b) Financial Statement Schedules.
All financial statement schedules are omitted because the information called for is not required or is shown either in the consolidated financial statements or in the notes thereto.
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ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement on Form S-1 to be signed on its behalf by the undersigned, thereunto duly authorized, in Houston, Texas, on the 17th day of July, 2019.
| SUNNOVA ENERGY INTERNATIONAL INC. | ||
| By: | /s/ William J. Berger | |
| William J. Berger | ||
| Chairman of the Board, President and Chief Executive Officer | ||
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Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement on Form S-1 has been signed by the following persons in the capacities and on the dates indicated.
| Signature |
Title |
Date | ||
| /s/ William J. Berger William J. Berger |
Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer) | July 17, 2019 | ||
| /s/ Robert L. Lane Robert L. Lane |
Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) | July 17, 2019 | ||
| * Rahman D’Argenio |
Director |
July 17, 2019 | ||
| * Matthew DeNichilo |
Director |
July 17, 2019 | ||
| * Doug Kimmelman |
Director |
July 17, 2019 | ||
| * Mark Longstreth |
Director |
July 17, 2019 | ||
| * Michael C. Morgan |
Director |
July 17, 2019 | ||
| * C. Park Shaper |
Director |
July 17, 2019 | ||
| * Scott D. Steimer |
Director |
July 17, 2019 | ||
| /s/ William J. Berger William J. Berger |
As Attorney-in-fact |
July 17, 2019 | ||
| * | William J. Berger hereby signs this Amendment No. 3 to the Registration Statement on behalf of the indicated person for whom he is attorney-in-fact pursuant to powers of attorney previously included with the Registration Statement on Form S-1 of Sunnova International Inc. filed on June 27, 2019 with the Securities and Exchange Commission. |
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Exhibit 3.7
FORM OF SECOND AMENDED AND RESTATED BYLAWS
OF
SUNNOVA ENERGY INTERNATIONAL, INC.
(Adopted on _______)
(Effective upon the closing of the Corporation’s initial public offering)
TABLE OF CONTENTS
| Page | ||||||
| ARTICLE I STOCKHOLDERS |
1 | |||||
| 1.1 |
Place of Meetings | 1 | ||||
| 1.2 |
Annual Meeting | 1 | ||||
| 1.3 |
Special Meetings | 1 | ||||
| 1.4 |
Notice of Meetings | 1 | ||||
| 1.5 |
Voting List | 2 | ||||
| 1.6 |
Quorum | 3 | ||||
| 1.7 |
Adjournments | 3 | ||||
| 1.8 |
Proxies | 3 | ||||
| 1.9 |
Action at Meeting | 4 | ||||
| 1.10 |
Notice of Stockholder Business and Nominations | 4 | ||||
| 1.11 |
Conduct of Meetings; Inspectors of Election | 14 | ||||
| ARTICLE II DIRECTORS |
15 | |||||
| 2.1 |
General Powers | 15 | ||||
| 2.2 |
Number, Election, Term and Qualification | 15 | ||||
| 2.3 |
Chairperson of the Board; Vice Chairperson of the Board | 16 | ||||
| 2.4 |
Quorum | 16 | ||||
| 2.5 |
Action at Meeting | 16 | ||||
| 2.6 |
Removal | 16 | ||||
| 2.7 |
Newly Created Directorships; Vacancies | 17 | ||||
| 2.8 |
Resignation | 17 | ||||
| 2.9 |
Regular Meetings | 17 | ||||
| 2.10 |
Special Meetings | 17 | ||||
| 2.11 |
Notice of Special Meetings | 17 | ||||
| 2.12 |
Meetings by Conference Communications Equipment | 17 | ||||
| 2.13 |
Action by Consent | 17 | ||||
| 2.14 |
Committees | 18 | ||||
| 2.15 |
Compensation of Directors | 18 | ||||
| ARTICLE III OFFICERS |
18 | |||||
| 3.1 |
Titles | 18 | ||||
| 3.2 |
Election | 19 | ||||
| 3.3 |
Qualification | 19 | ||||
| 3.4 |
Tenure | 19 | ||||
| 3.5 |
Resignation and Removal | 19 | ||||
| 3.6 |
Vacancies | 19 | ||||
| 3.7 |
President; Chief Executive Officer | 19 | ||||
| 3.8 |
Chief Financial Officer | 20 | ||||
| 3.9 |
Vice Presidents | 20 | ||||
| 3.10 |
Secretary and Assistant Secretaries | 20 | ||||
| 3.11 |
Treasurer and Assistant Treasurers | 21 | ||||
| 3.12 |
Salaries | 21 | ||||
| 3.13 |
Delegation of Authority | 21 | ||||
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| ARTICLE IV CAPITAL STOCK |
21 | |||||
| 4.1 |
Stock Certificates; Uncertificated Shares | 21 | ||||
| 4.2 |
Transfers | 23 | ||||
| 4.3 |
Lost, Stolen or Destroyed Certificates | 23 | ||||
| 4.4 |
Record Date | 23 | ||||
| 4.5 |
Regulations | 24 | ||||
| ARTICLE V GENERAL PROVISIONS |
24 | |||||
| 5.1 |
Fiscal Year | 24 | ||||
| 5.2 |
Corporate Seal | 24 | ||||
| 5.3 |
Waiver of Notice | 24 | ||||
| 5.4 |
Voting of Securities | 25 | ||||
| 5.5 |
Evidence of Authority | 25 | ||||
| 5.6 |
Certificate of Incorporation | 25 | ||||
| 5.7 |
Severability | 25 | ||||
| 5.8 |
Pronouns | 25 | ||||
| 5.9 |
Electronic Transmission | 25 | ||||
| ARTICLE VI AMENDMENTS |
25 | |||||
| ARTICLE VII INDEMNIFICATION AND ADVANCEMENT |
26 | |||||
| 7.1 |
Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation | 26 | ||||
| 7.2 |
Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation | 26 | ||||
| 7.3 |
Authorization of Indemnification | 27 | ||||
| 7.4 |
Right of Claimant to Bring Suit | 27 | ||||
| 7.5 |
Expenses Payable in Advance | 28 | ||||
| 7.6 |
Nonexclusivity of Indemnification and Advancement of Expenses | 28 | ||||
| 7.7 |
Insurance | 28 | ||||
| 7.8 |
Certain Definitions | 29 | ||||
| 7.9 |
Survival of Indemnification and Advancement of Expenses | 29 | ||||
| 7.10 |
Limitation on Indemnification | 29 | ||||
| 7.11 |
Contract Rights | 30 | ||||
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ARTICLE I
STOCKHOLDERS
1.1 Place of Meetings. All meetings of stockholders shall be held at such place, if any, as may be designated from time to time by the Board of Directors (the “Board”) of Sunnova Energy International Inc. (the “Corporation”), the Chairperson of the Board or the Chief Executive Officer or, if not so designated, at the principal office of the Corporation. The Board may, in its sole discretion, determine that a meeting shall not be held at any place, but may instead be held solely by means of remote communication in accordance with Section 211(a)(2) of the General Corporation Law of the State of Delaware (the “DGCL”).
1.2 Annual Meeting. The annual meeting of stockholders for the election of directors to succeed those whose terms expire and for the transaction of such other business as may properly be brought before the meeting in accordance with these Bylaws shall be held on a date and at a time designated by the Board, the Chairperson of the Board or the Chief Executive Officer. The Board or the chairperson of the meeting may postpone, recess, reschedule or cancel any previously scheduled annual meeting of stockholders at any time, before or after the notice for such meeting has been sent to the stockholders.
1.3 Special Meetings. Special meetings of stockholders for any purpose or purposes may be called only in the manner provided in the Certificate of Incorporation. The Board or the chairperson of the meeting may postpone, recess, reschedule or cancel any previously scheduled special meeting of stockholders at any time, before or after the notice for such meeting has been sent to the stockholders. Business to be conducted at a special meeting of stockholders shall be limited to the purposes stated in the notice of meeting. Nothing contained in this Section 1.3 shall be construed as limiting, fixing or affecting the time when a meeting of stockholders called by action of the Board may be held.
1.4 Notice of Meetings. Except as otherwise provided by law, notice of each meeting of stockholders, whether annual or special, shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting as of the record date for determining the stockholders entitled to notice of the meeting. Without limiting the manner by which notice otherwise may be given to stockholders, any notice to stockholders given by the Corporation shall be effective if given by electronic transmission in accordance with applicable law. The notices of all meetings shall state the place, if any, date and
time of the meeting, the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting, and the record date for determining the stockholders entitled to vote at the meeting (if such date is different from the record date for stockholders entitled to notice of the meeting). The notice of a special meeting shall state, in addition, the purpose or purposes for which the meeting is called. If notice is given by mail, such notice shall be deemed given when deposited in the United States mail, postage prepaid, directed to the stockholder at such stockholder’s address as it appears on the records of the Corporation. If notice is given by electronic transmission, such notice shall be deemed given at the time specified in Section 232 of the DGCL.
1.5 Voting List. The Corporation shall prepare, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting (provided, however, if the record date for determining the stockholders entitled to vote is less than ten (10) days before the date of the meeting, the list shall reflect the stockholders entitled to vote as of the tenth day before the meeting date), arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting for a period of at least ten (10) days prior to the meeting: (a) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (b) during ordinary business hours, at the principal place of business of the Corporation. If the meeting is to be held at a place, then such list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. If the meeting is to be held solely by means of remote communication, then such list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting. Except as otherwise provided by law, such list shall presumptively determine the identity of the stockholders entitled to examine the list of stockholders required by this Section 1.5 and vote at the meeting and the number of shares held by each of them. To the fullest extent permitted by applicable law, the failure to comply with any requirements of this Section 1.5 shall not affect the validity of any action taken at such meeting.
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1.6 Quorum. Except as otherwise provided by law, the Certificate of Incorporation or these Bylaws, at each meeting of stockholders the presence of the holders of a majority in voting power of the shares of the capital stock of the Corporation issued and outstanding and entitled to vote at the meeting, present in person or represented by proxy, shall constitute a quorum for the transaction of business; provided, however, that where a separate vote by a class or classes or series of capital stock is required by law or the Certificate of Incorporation, the holders of a majority in voting power of the shares of such class or classes or series of the capital stock of the Corporation issued and outstanding and entitled to vote on such matter, present in person or represented by proxy, shall constitute a quorum with respect to the vote on such matter. A quorum, once established at a meeting, shall not be broken by the withdrawal of enough votes to leave less than a quorum.
1.7 Adjournments. Any meeting of stockholders, annual or special, may be adjourned from time to time to any other time and to the same or some other place at which a meeting of stockholders may be held under these Bylaws by the Board, the chairperson of the meeting or, if directed to be voted on by the chairperson of the meeting, by the stockholders present in person or represented by proxy at the meeting and entitled to vote thereon, although less than a quorum. It shall not be necessary to notify any stockholder of any adjournment of less than 30 days if the time and place of the adjourned meeting, and the means of remote communication, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such adjourned meeting, are announced at the meeting at which adjournment is taken, unless after the adjournment a new record date is fixed for the adjourned meeting. If the adjournment is for more than thirty (30) days, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. If after the adjournment a new record date for determination of stockholders entitled to vote is fixed for the adjourned meeting, the Board shall fix as the record date for determining stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote at the adjourned meeting, and shall give notice of the adjourned meeting to each stockholder of record as of the record date so fixed for notice of such adjourned meeting. At the adjourned meeting, the Corporation may transact any business which might have been transacted at the original meeting.
1.8 Proxies. Each stockholder of record entitled to vote at a meeting of stockholders may authorize another person or persons to vote for such stockholder by proxy. Any copy, facsimile transmission or other reliable reproduction of the document authorizing a person to vote by proxy may be substituted or used in lieu of the original document for any and all purposes for which the original document could be used; provided that such copy, facsimile transmission or other reproduction shall be a complete reproduction of the entire document. Any electronic transmission authorizing a person to vote by proxy must set forth or be submitted with information from which it can be determined that the transmission was authorized by the stockholder. No such proxy shall be voted upon after three (3) years from its date, unless the proxy provides for a longer period.
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1.9 Action at Meeting. When a quorum is present at any meeting, any matter other than the election of directors to be voted upon by the stockholders at such meeting shall be decided by a majority of the votes cast by the holders of all of the shares of stock present in person or represented by proxy at the meeting and voting affirmatively or negatively on such matter (or if one or more class, classes or series of stock are entitled to vote as a separate class or series, then a majority of the votes cast by the holders of the shares of stock of such class, classes or series entitled to vote as a separate class or series present in person or represented by proxy at the meeting and voting affirmatively or negatively on such matter), except when a different vote is required by express provision of applicable law, regulation applicable to the Corporation or its securities, the rules or regulations of any stock exchange applicable to the Corporation, the Certificate of Incorporation or these Bylaws, in which case such express provision shall govern. Voting at meetings of stockholders need not be by written ballot. At all meetings of stockholders for the election of directors at which a quorum is present a plurality of the votes cast shall be sufficient to elect directors.
1.10 Advance Notice Procedures.
(a) Nomination of Directors at Annual Meetings.
(i) Except for any directors entitled to be elected by the holders of Preferred Stock, only persons who are nominated in accordance with the procedures in this Section 1.10 shall be eligible for election or re-election as directors. Nomination for election to the Board at an annual meeting of stockholders may be made only (A) pursuant to the Corporation’s notice of meeting (or any supplement thereto), (B) by or at the direction of the Board or any duly authorized committee thereof or (C) by a stockholder of the Corporation who (1) timely complies in proper form in writing with the notice procedures in Section 1.10(a), (2) is a stockholder of record on the date of the giving of notice to the Secretary of the Corporation required by this Section 1.10(a), on the record date for the determination of stockholders entitled to notice of the annual meeting and on the record date for the determination of stockholders entitled to vote at such meeting and (3) is entitled to vote at such meeting upon such election of directors. For any nominations to be properly brought before an annual meeting by a stockholder pursuant to clause (C) of this Section 1.10(a)(i), the stockholder must have given timely notice thereof in proper form, and must timely provide any updates and supplements to such notice thereof, in writing to the Secretary of the Corporation at such times and in such forms provided by this Section 1.10(a).
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(ii) To be timely, a stockholder’s notice required by Section 1.10(a)(i)(C) must be received by the Secretary at the principal executive offices of the Corporation not later than the close of business on the ninetieth (90th) day, nor earlier than the close of business on the one hundred twentieth (120th) day, prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is scheduled for a date that is more than thirty (30) days before or more than seventy (70) days after such anniversary date, notice by the stockholder to be timely must be so received not earlier than the close of business on the one hundred twentieth (120th) day prior to the date of such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to the date of such annual meeting or, if the first public announcement of the date of such annual meeting is less than one hundred (100) days prior to the date of such annual meeting, the tenth (10th) day following the day on which public announcement of the date of such meeting is first made by the Corporation. For purposes of these Bylaws, for the first annual meeting following the initial public offering of the Common Stock of the Corporation, the date of the first anniversary of the preceding year’s annual meeting shall be deemed to be __________, 2019. In no event shall any adjournment, recess, cancellation, rescheduling or postponement of an annual meeting or the public announcement thereof commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.
(iii) To be in proper form for purposes of this Section 1.10(a), a stockholder’s notice to the Secretary must set forth: (A) as to each person whom the stockholder proposes to nominate for election as a director (1) the name, age, business and residence address of the nominee, (2) the principal occupation or employment of the nominee (presently and for the past five (5) years), (3) all other information relating to such nominee that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Section 14(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations promulgated thereunder, (4) a reasonably detailed description of all direct and indirect compensatory, payment or other financial agreements, arrangements and understandings during the past three years that such nominee
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has with any other person or entity other than the Corporation including the amount of any payment or payments received or receivable thereunder, in each case in connection with candidacy or service as a director of the Corporation, and any other material relationships, between or among such stockholder and Stockholder Associated Person, if any, and their respective affiliates and associates, or other person or entity acting in concert therewith, on the one hand, and such proposed nominee and his or her respective affiliates and associates, on the other hand, including, without limitation, all information that would be required to be disclosed pursuant to Rule 404 promulgated under Regulation S-K if the stockholder making the nomination and any beneficial owner on whose behalf the nomination is made, if any, or any affiliate or associate thereof or person or entity acting in concert therewith, were the “registrant” for purposes of such rule and the nominee were a director or executive officer of such registrant, (5) such nominee’s written consent to being named in the Corporation’s proxy statement as a nominee of such stockholder and to serving as a director if elected, which shall state his or her intention to serve a full term as a director if elected, (6) all information with respect to such nominee that would be required to be set forth in a stockholder’s notice pursuant to this Section 1.10 if such nominee were the stockholder giving notice hereunder (the information required by this Section 1.10(a)(iii) is referred to herein as the “Nominee Information”); and (B) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination is made (1) the name and address of such stockholder, as they appear on the Corporation’s books, and of such stockholder’s Stockholder Associated Person, (2) the class or series and number of shares of each such class or series of capital stock of the Corporation which are, directly or indirectly, owned beneficially (within the meaning of Rule 13d-3 under the Exchange Act) or of record by such stockholder and such Stockholder Associated Person (provided, that such stockholder and the Stockholder Associated Person, if any, on whose behalf the nomination is made shall in all events be deemed to beneficially own any shares of any class or series and number of shares of capital stock of the Corporation as to which such stockholder or Stockholder Associated Person, if any, has a right to acquire beneficial ownership at any time in the future), (3) a complete and accurate description of all Derivative Transactions (as defined below), whether or not subject to settlement in underlying shares of capital stock of the Corporation or otherwise, by such stockholder or by any Stockholder Associated Person during the previous twelve (12) month period, including the date of the transactions and the class, series and number of securities involved in, and the material economic terms of, such Derivative Transactions, (4) a complete and accurate description of any agreement, arrangement or understanding with respect to the nomination (and any related business proposal) between or among such stockholder and/or such stockholder’s
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Stockholder Associated Person, any of their respective affiliates or associates, and any other person or entity (including their names) acting in concert with any of the foregoing, including the name and address of any other person(s) or entity or entities known to the stockholder or any Stockholder Associated Person to support such nomination, (5) a representation that the stockholder is a holder of record of stock of the Corporation entitled to vote at such meeting upon such nomination and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice, (6) a representation as to whether the stockholder and/or any Stockholder Associated Person intends or is part of a group which intends (x) to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the Corporation’s outstanding capital stock reasonably believed by the stockholder or Stockholder Associated Person to be sufficient to elect such nominee (and such representation shall be included in any such proxy statement and form of proxy) and/or (y) otherwise to solicit proxies or votes from stockholders in support of such nomination (and such representation shall be included in any such solicitation materials) (such information provided and statements made as required by clauses (x) and (y) above, a “Nominee Solicitation Statement”), and (7) any other information relating to such stockholder and Stockholder Associated Person, if any, required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for, as applicable, the proposal and/or for the election of directors in an election contest pursuant to Section 14(a) of the Exchange Act and the rules and regulations promulgated thereunder. The Corporation may require any proposed nominee to furnish such other information as the Corporation may reasonably require to determine the eligibility of such proposed nominee to serve as an independent director of the Corporation or that could reasonably be expected to be material to a stockholders’ understanding of whether such nominee would be independent under applicable Securities and Exchange Commission and stock exchange rules and the Corporation’s publicly disclosed corporate governance guidelines, as applicable.
In addition, to be in proper written form, a stockholder’s notice to the Secretary must be supplemented by such stockholder not later than ten (10) days after the record date for determining the stockholders entitled to notice of the meeting to disclose the information specified in clause (1) through (4) of Section 1.10(a)(iii)(A) as of such record date. Additionally, a nominee shall not be eligible for election or re-election if a stockholder or Stockholder Associated Person, as applicable, takes action contrary to the representations made in the Nominee Solicitation Statement applicable to such nominee or in any other notice to the Corporation or if the Nominee Solicitation Statement applicable to such nominee or any other relevant notice contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein not misleading.
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Notwithstanding anything in the first sentence of Section 1.10(a)(ii) to the contrary, in the event that the number of directors to be elected to the Board at the annual meeting is increased effective after the time period for which nominations would otherwise be due under Section 1.10(a)(ii) and there is no public announcement by the Corporation naming the nominees for the additional directorships at least one hundred (100) days prior to the first anniversary of the preceding year’s annual meeting, a stockholder’s notice required by this Section 1.10(a) shall also be considered timely, but only with respect to nominees for the additional directorships, if it shall be received by the Secretary at the principal executive offices of the Corporation not later than the close of business on the tenth (10th) day following the day on which such public announcement is first made by the Corporation.
(b) Notice of Business at Annual Meetings.
(i) At any annual meeting of the stockholders, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting, business other than the election of directors must be (A) specified in the notice of meeting (or any supplement thereto), (B) otherwise brought by or at the direction of the Board or any duly authorized committee thereof or (C) properly brought before the meeting by a stockholder in accordance with this Section 1.10(b).
(ii) For business other than the election of directors to be properly brought before an annual meeting by a stockholder pursuant to Section 1.10(b)(i)(C), the business must constitute a proper matter under Delaware law for stockholder action and the stockholder must (A) have given timely notice thereof in proper form in writing to the Secretary of the Corporation (and must timely provide any updates or supplements to such notice at such times and in such forms provided by this Section 1.10(b)), (B) be a stockholder of record on the date of the giving of such notice, on the record date for the determination of stockholders entitled to notice of the annual meeting and on the record date for the determination of stockholders entitled to vote at such annual meeting and (C) be entitled to vote at such annual meeting and on such proposal.
(iii) To be timely, a stockholder’s notice required by Section 1.10(b)(ii) must be received by the Secretary at the principal executive offices of the Corporation not later than the close of business on the ninetieth (90th) day, nor earlier than the close of business on the one hundred twentieth (120th) day, prior to the first anniversary of the preceding year’s annual
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meeting; provided, however, that in the event that the date of the annual meeting is scheduled for a date that is more than thirty (30) days before or more than seventy (70) days after such anniversary date, notice by the stockholder to be timely must be so received not earlier than the close of business on the one hundred twentieth (120th) day prior to the date of such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to the date of such annual meeting or, if the first public announcement by the Corporation of the date of such annual meeting is less than one hundred (100) days prior to the date of such annual meeting, the tenth (10th) day following the day on which the Corporation first makes a public announcement of the date of such meeting at which directors are to be elected. In no event shall any adjournment, recess, cancellation, rescheduling or postponement of an annual meeting or the public announcement thereof commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.
(iv) To be in proper form for purposes of this Section 1.10(b), such stockholder’s notice to the Secretary must set forth: (A) as to each matter of business the stockholder intends to bring before the annual meeting (1) a reasonably detailed description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any direct or indirect material interest in such business of such stockholder and any Stockholder Associated Person in such business, (2) the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend the these Bylaws, the language of the proposed amendment), (3) a complete and accurate description of all agreements, arrangements and understandings between or among such stockholder and such stockholder’s Stockholder Associated Person, if any, and the name and address of any other person(s) or entity or entities in connection with the proposal of such business by such stockholder, and (4) such other information relating to any proposed item of business as the Corporation may reasonably require to determine whether such proposed item of business is a proper matter for stockholder action; and (B) as to the stockholder giving the notice and any Stockholder Associated Person (1) the information required to be provided pursuant to clause (1) through (4) of Section 1.10(a)(iii)(A) above (except that the references to “nominee” or “nomination” in such clauses shall instead refer to “business proposal” for purposes of this paragraph), (2) a representation whether the stockholder and/or any Stockholder Associated Person intends or is part of a group which intends (x) to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the Corporation’s outstanding capital stock required under applicable law to approve or adopt the proposal (and such representation shall be included in any such proxy statement and form of
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proxy) and/or (y) otherwise to solicit proxies or votes from stockholders in support of such proposal (and such representation shall be included in any such solicitation materials), (such information provided and statements made as required by clauses (x) and (y), a “Business Solicitation Statement”); (3) any other information relating to such stockholder and Stockholder Associated Person, if any, required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for the proposal pursuant to Section 14(a) of the Exchange Act and the rules and regulations promulgated thereunder.
In addition, to be in proper written form, a stockholder’s notice to the Secretary must be supplemented by such stockholder not later than ten (10) days after the record date for determining the stockholders entitled to notice of the meeting to disclose the information specified in clause (1) of Section 1.10(b)(iv)(B) as of such record date. Also, stockholder seeking to bring business before the annual meeting (other than the election of directors) shall promptly provide any other information reasonably requested by the Corporation. Additionally, business proposed to be brought by a stockholder may not be brought before the annual meeting if such stockholder or a Stockholder Associated Person, as applicable, takes action contrary to the representations made in the Business Solicitation Statement applicable to such business or if the Business Solicitation Statement applicable to such business contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein not misleading.
Notwithstanding anything in this Section 1.10(b) to the contrary, the foregoing notice requirements of this Section 1.10(b) shall be deemed satisfied by a stockholder with respect to business other than a nomination if the stockholder has notified the Corporation of his, her or its intention to present a proposal at an annual meeting in compliance with applicable rules and regulations promulgated under the Exchange Act and such stockholder’s proposal has been included in a proxy statement that has been prepared by the Corporation to solicit proxies for such annual meeting.
(c) Special Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the Corporation’s notice of meeting. Nominations of persons for election to the Board may be made at a special meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of meeting only (i) by or at the direction of the Board or any duly authorized committee thereof or (ii) provided that the Board has determined that directors shall be elected at such meeting, by any stockholder of the Corporation who (A) is a stockholder of record at the time the notice provided for in this Section 1.10 is received by the Secretary of the Corporation, on the
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record date for the determination of stockholders entitled to notice of the special meeting and on the record date for the determination of stockholders entitled to vote at such special meeting, (B) is entitled to vote at the meeting and upon such election and (C) complies with the notice procedures set forth in this Section 1.10(c) (including, without limitation, as to timely notice and as to proper form, which notice shall include the information, agreements, consents and representations set forth in Section 1.10(a) except that the references to “annual meeting” in Section 1.10(a) shall instead refer to such “special meeting”) and applicable law. In the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more directors to the Board, any such stockholder entitled to vote in such election of directors may nominate a person or persons (as the case may be) for election to such position(s) as specified in the Corporation’s notice of meeting, if the stockholder’s notice required by paragraph (a)(iii) of this Section 1.10 with respect to each such nomination (including, without limitation, all Nominee Information) shall be received by the Secretary at the principal executive offices of the Corporation not earlier than the close of business on the one hundred twentieth (120th) day prior to the date of such special meeting and not later than the close of business on the later of the ninetieth (90th) day prior to such special meeting or, if the first public announcement of the date of such special meeting at which directors are to be elected is less than one hundred (100) days prior to the date of such special meeting, the tenth (10th) day following the day on which public announcement is first made of the date of the special meeting by the Corporation. In no event shall any adjournment, recess, cancellation, rescheduling or postponement of a special meeting or the public announcement thereof commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.
(d) General. (i) Except as otherwise expressly provided in any applicable rule or regulation promulgated under the Exchange Act, only such persons who are nominated in accordance with the procedures set forth in this Section 1.10 shall be eligible to be elected at an annual or special meeting of stockholders of the Corporation to serve as directors and only such business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 1.10. Except as otherwise provided by law, the chairperson of the meeting shall have the power and duty (a) to determine whether a nomination or any business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 1.10 (including whether the stockholder or beneficial owner, if any, on whose behalf the nomination or proposal is made, solicited (or is part of a group which solicited) or did not so solicit, as the case
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may be, proxies or votes in support of such stockholder’s nominee or proposal in compliance with such stockholder’s representation as required by clause (A)(2)(c)(vi) of this Section 1.10) and (b) if any proposed nomination or business was not made or proposed in compliance with this Section 1.10, to declare that such nomination shall be disregarded or that such proposed business shall not be transacted. Except as otherwise required by law, nothing in this Section 1.10 shall obligate the Corporation or the Board to include in any proxy statement or other stockholder communication distributed on behalf of the Corporation or the Board information with respect to any nominee for director submitted by a stockholder. Notwithstanding the foregoing provisions of this Section 1.10, unless otherwise required by law, if the stockholder (or a qualified representative of the stockholder) does not appear at the annual or special meeting of stockholders of the Corporation to present a nomination or proposed business, such nomination shall be disregarded and such proposed business shall not be transacted, notwithstanding that proxies in respect of such vote may have been received by the Corporation. For purposes of this Section 1.10, to be considered a qualified representative of the stockholder, a person or entity must be a duly authorized officer, manager or partner of such stockholder or must be authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as proxy at the meeting of stockholders and such person or entity must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of stockholders.
(ii) For purposes of these Bylaws:
“affiliate” has the meaning in Rule 12b-2 under the Exchange Act.
“associate” has the meaning in Rule 12b-2 under the Exchange Act.
“beneficial ownership,” including the correlative terms “beneficially own” and “beneficial owner,” has the meaning in Rule 13d-3 under the Exchange Act, except that a person shall in all events be deemed to beneficially own any shares of any class or series of capital stock of the Corporation as to which such person has a right to acquire (by conversion, exercise of otherwise) beneficial ownership currently or at any time in the future.
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“Derivative Transaction” shall mean any agreement, arrangement, interest or understanding entered into by, or on behalf or for the benefit of, the stockholder or beneficial owner or any of its affiliates or associates, whether record or beneficial:
| (w) | the value of which is derived in whole or in part from the value of any class or series of shares or other securities of the Corporation, |
| (x) | which otherwise provides any direct or indirect opportunity to gain or share in any gain derived from a change in the value of securities of the Corporation, |
| (y) | the effect or intent of which is to mitigate loss, manage risk or benefit of security value or price changes, or |
| (z) | which provides the right to vote or increase or decrease the voting power of, such stockholder or beneficial owner, or any of its affiliates or associates, with respect to any securities of the Corporation, |
which agreement, arrangement, interest or understanding may include, without limitation, any option, warrant, debt position, note, bond, convertible security, swap, stock appreciation right, short position, profit interest, hedge, right to dividends, voting agreement, performance-related fee or arrangement to borrow or lend shares (whether or not subject to payment, settlement, exercise or conversion in any such class or series), and any proportionate interest of such stockholder or beneficial owner in the securities of the Corporation held, directly or indirectly, by any general or limited partnership, limited liability company or similar entity of which such stockholder or beneficial owner is or, directly or indirectly, owns an interest in a general partner or managing member of such entity.
“public announcement” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or other national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act and the rules and regulations promulgated thereunder.
“Stockholder Associated Person” shall mean, for any stockholder, (x) any person or entity controlling, directly or indirectly, or acting in concert with, such stockholder, (y) any beneficial owner of shares of stock of the Corporation owned of record or beneficially by such stockholder or (z) any person or entity controlling, controlled by or under common control with any person or entity referred to in the preceding clauses (x) or (y).
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(iii) Notwithstanding the foregoing provisions of this Section 1.10, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations promulgated thereunder with respect to the matters set forth herein; provided, however, that any references in these Bylaws to the Exchange Act or the rules and regulations promulgated thereunder are not intended to and shall not limit any requirements applicable to nominations or proposals as to any other business to be considered pursuant to this Section 1.10 (including paragraphs (a)(i)(C), (b)(i)(C) and (c) hereof), and compliance with paragraphs (a)(i)(B), (b)(i)(C) and (c) of this Section 1.10 shall be the exclusive means for a stockholder to make nominations or submit other business (other than business other than nominations brought properly under and in compliance with Rule 14a-8 of the Exchange Act, as may be amended from time to time). Nothing in these Bylaws shall be deemed to affect any rights (a) of stockholders to request inclusion of proposals or nominations in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act or (b) of the holders of any series of Preferred Stock to elect directors pursuant to any applicable provisions of the Certificate of Incorporation.
1.11 Conduct of Meetings; Inspectors of Election.
(e) Meetings of stockholders shall be presided over by the Chairperson of the Board, if any, or in the Chairperson’s absence by the Chief Executive Officer, or in the Chief Executive Officer’s absence, by the President, or in the absence of all of the foregoing persons by a chairperson designated by the Board. The Secretary shall act as secretary of the meeting, but in the Secretary’s absence the chairperson of the meeting may appoint any person to act as secretary of the meeting.
(f) The Board may adopt by resolution such rules, regulations and procedures for the conduct of any meeting of stockholders of the Corporation as it shall deem appropriate including, without limitation, such guidelines and procedures as it may deem appropriate regarding the participation by means of remote communication of stockholders and proxyholders not physically present at a meeting. Except to the extent inconsistent with such rules, regulations and procedures as adopted by the Board, the chairperson of any meeting of stockholders shall have the right and authority to convene and (for any or no reason) to recess and/or adjourn the meeting, to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairperson, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board or prescribed by the chairperson of the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to
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stockholders of record of the Corporation, their duly authorized and constituted proxies or such other persons as shall be determined; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. Unless and to the extent determined by the Board or the chairperson of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.
(g) The chairperson of the meeting shall announce at the meeting when the polls for each matter to be voted upon at the meeting will be opened and closed. After the polls close, no ballots, proxies or votes or any revocations or changes thereto may be accepted.
(h) The Corporation may, and if required by law, shall, in advance of any meeting of stockholders, appoint one or more inspectors of election to act at the meeting and make a written report thereof. One or more other persons may be designated as alternate inspectors to replace any inspector who fails to act. If no inspector or alternate is able to act at a meeting of stockholders, the chairperson of the meeting shall appoint one or more inspectors to act at the meeting. Unless otherwise required by law, inspectors may be officers, employees, agents or representatives of the Corporation. Each inspector, before entering upon the discharge of such inspector’s duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of such inspector’s ability. The inspector shall have the duties prescribed by law and, when the vote is completed, shall certify their determination of the result of the vote taken and of such other facts as may be required by law. Every vote taken by ballots shall be counted by a duly appointed inspector or duly appointed inspectors.
ARTICLE II
DIRECTORS
2.1 General Powers. The business and affairs of the Corporation shall be managed by or under the direction of the Board, who may exercise all of the powers of the Corporation except as otherwise provided by law or the Certificate of Incorporation.
2.2 Number, Election, Term and Qualification. The total number of directors constituting the Board shall be as fixed in, or in the manner provided by, the Certificate of Incorporation. Election of directors need not be by written ballot. The term of office of each director shall be as specified in the Certificate of Incorporation. Directors need not be stockholders of the Corporation.
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2.3 Chairperson of the Board. The Board may appoint from its members a Chairperson of the Board, and such person need not be an employee or officer of the Corporation. If the Board appoints a Chairperson of the Board, such Chairperson shall perform such duties and possess such powers as are assigned by the Board and, if the Chairperson of the Board is also designated as the Corporation’s Chief Executive Officer, shall have the powers and duties of the Chief Executive Officer prescribed in Section 3.7 of these Bylaws. Unless otherwise provided by the Board, the Chairperson of the Board shall preside at all meetings of the Board.
2.4 Quorum. The greater of (a) a majority of the directors at any time in office and (b) one-third of the Whole Board shall constitute a quorum of the Board. For purposes of these Bylaws, the term “Whole Board” shall mean the total number of authorized directors whether or not there exist any vacancies or unfilled seats in previously authorized directorships (provided for the avoidance of doubt that voting power shall be attributed to any such vacancies or unfilled seats). If at any meeting of the Board there shall be less than a quorum, a majority of the directors present may adjourn the meeting from time to time without further notice other than announcement at the meeting, until a quorum shall be present.
2.5 Action at Meeting. Every act or decision done or made by a majority of the directors present at a meeting duly held at which a quorum is present shall be regarded as the act of the Board, unless a greater number is required by law, the Certificate of Incorporation or these Bylaws.
2.6 Removal. Subject to the rights of holders of any series of Preferred Stock, directors of the Corporation may be removed only as expressly provided in the Certificate of Incorporation or by applicable law.
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2.7 Newly Created Directorships; Vacancies. Any vacancy or newly created directorship on the Board, however occurring, shall be filled only in accordance with the Certificate of Incorporation.
2.8 Resignation. Any director may resign by delivering a resignation in writing or by electronic transmission to the Corporation. Such resignation shall be effective upon delivery unless it is specified to be effective at some later time or upon the happening of some later event.
2.9 Regular Meetings. Regular meetings of the Board may be held without notice at such time and place as shall be determined from time to time by the Board; provided that any director who is absent when such a determination is made shall be given notice of the determination. A regular meeting of the Board may be held without notice immediately after and at the same place as the annual meeting of stockholders.
2.10 Special Meetings. Special meetings of the Board may be called by the Chairperson of the Board, the Chief Executive Officer, the affirmative vote of a majority of the directors then in office, or by one director in the event that there is only a single director in office.
2.11 Notice of Special Meetings. Notice of the date, place and time of any special meeting of the Board shall be given to each director (a) in person, by telephone or by electronic transmission at least twenty-four (24) hours in advance of the meeting, (b) by delivering written notice by hand to such director’s last known business or home at least twenty-four (24) hours in advance of the meeting, or (c) by sending written notice by first-class mail to such director’s last known business or home address at least seventy-two (72) hours in advance of the meeting. Such notice may be given by the Secretary or by the Chairperson of the Board, the Chief Executive Officer or one of the directors calling the meeting. A notice or waiver of notice of a meeting of the Board need not specify the purposes of the meeting.
2.12 Meetings by Conference Communications Equipment. Directors may participate in meetings of the Board or any committee thereof by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation by such means shall constitute presence in person at such meeting.
2.13 Action by Consent. Any action required or permitted to be taken at any meeting of the Board or of any committee thereof may be taken without a meeting, if all members of the Board or committee, as the case may be, consent to the action in writing or by electronic transmission.
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2.14 Committees. The Board may designate one or more committees, each committee to consist of one or more of the directors of the Corporation with such lawfully delegable powers and duties as the Board thereby confers, to serve at the pleasure of the Board. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members of the committee present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board and subject to the provisions of law, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation and may authorize the seal of the Corporation to be affixed to all papers which may require it. Each such committee shall keep minutes and make such reports as the Board may from time to time request. Except as the Board may otherwise determine, any committee may make rules for the conduct of its business, but unless otherwise provided by the directors or in such rules, its business shall be conducted as nearly as possible in the same manner as is provided in these Bylaws for the Board. Except as otherwise provided in the Certificate of Incorporation, these Bylaws, or the resolution of the Board designating the committee, a committee may create one or more subcommittees, each subcommittee to consist of one or more members of the committee, and delegate to a subcommittee any or all of the powers and authority of the committee.
2.15 Compensation of Directors. Directors may be paid such compensation for their services and such reimbursement for expenses of attendance at meetings as the Board may from time to time determine. No such payment shall preclude any director from serving the Corporation or any of its parent or subsidiary entities in any other capacity and receiving compensation for such service.
ARTICLE III
OFFICERS
3.1 Titles. The officers of the Corporation may consist of a Chief Executive Officer, a President, a Chief Financial Officer, a Treasurer and a Secretary and such other officers with such other titles as the Board shall from time to time determine. The Board may appoint such other officers, including one or more Vice Presidents and one or more Assistant Treasurers or Assistant Secretaries, as it may deem appropriate from time to time.
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3.2 Election. The officers of the Corporation shall be elected by the Board.
3.3 Qualification. No officer need be a stockholder. Any two or more offices may be held by the same person.
3.4 Tenure. Except as otherwise provided by law, by the Certificate of Incorporation or by these Bylaws, each officer shall hold office until such officer’s successor is duly elected and qualified, unless a different term is specified in the resolution electing or appointing such officer, or until such officer’s earlier death, resignation, disqualification or removal.
3.5 Resignation and Removal. Any officer may resign by delivering a resignation in writing or by electronic transmission to the Corporation. Such resignation shall be effective upon delivery unless it is specified to be effective at some later time or upon the happening of some later event. Any officer may be removed at any time, with or without cause, by the affirmative vote of a majority of the Whole Board. Except as the Board may otherwise determine, no officer who resigns or is removed shall have any right to any compensation as an officer for any period following such officer’s resignation or removal, or any right to damages on account of such removal, whether such officer’s compensation be by the month or by the year or otherwise, unless such compensation is expressly provided for in a duly authorized written agreement with the Corporation
3.6 Vacancies. The Board may fill any vacancy occurring in any office for any reason and may, in its discretion, leave unfilled, for such period as it may determine, any offices. Each such successor shall hold office for the unexpired term of such officer’s predecessor and until a successor is duly elected and qualified, or until such officer’s earlier death, resignation, disqualification or removal.
3.7 President; Chief Executive Officer. Unless the Board has designated another person as the Corporation’s Chief Executive Officer, the President shall be the Chief Executive Officer of the Corporation. The Chief Executive Officer shall have general charge and supervision of the business of the Corporation subject to the direction of the Board, and shall perform all duties and have all powers that are commonly incident to the office of chief executive or that are
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delegated to such officer by the Board. The President shall perform such other duties and shall have such other powers as the Board or the Chief Executive Officer (if the President is not the Chief Executive Officer) may from time to time prescribe. In the event of the absence, inability or refusal to act of the Chief Executive Officer or the President (if the President is not the Chief Executive Officer), the Vice President (or if there shall be more than one, the Vice Presidents in the order determined by the Board) shall perform the duties of the Chief Executive Officer and when so performing such duties shall have all the powers of and be subject to all the restrictions upon the Chief Executive Officer.
3.8 Chief Financial Officer. Unless the Board has designated another person as the Corporation’s Chief Financial Officer, the Treasurer shall be the Chief Financial Officer of the Corporation. The Chief Financial Officer shall perform such duties and possess such powers as the Board or the Chief Executive Officer may from time to time prescribe.
3.9 Vice Presidents. Each Vice President shall perform such duties and possess such powers as the Board or the Chief Executive Officer may from time to time prescribe. The Board may assign to any Vice President the title of Executive Vice President, Senior Vice President or any other title selected by the Board.
3.10 Secretary and Assistant Secretaries. The Secretary shall perform such duties and shall have such powers as the Board or the Chief Executive Officer may from time to time prescribe. In addition, the Secretary shall perform such duties and have such powers as are incident to the office of the secretary, including without limitation the duty and power to give notices of all meetings of stockholders and special meetings of the Board, to attend all meetings of stockholders and the Board and keep a record of the proceedings, to maintain a stock ledger and prepare lists of stockholders and their addresses as required, to be custodian of corporate records and the corporate seal and to affix and attest to the same on documents.
Any Assistant Secretary shall perform such duties and possess such powers as the Board, the Chief Executive Officer or the Secretary may from time to time prescribe. In the event of the absence, inability or refusal to act of the Secretary, the Assistant Secretary (or if there shall be more than one, the Assistant Secretaries in the order determined by the Board) shall perform the duties and exercise the powers of the Secretary.
The chairperson of any meeting of the Board or of stockholders may designate a temporary secretary to keep a record of any meeting.
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3.11 Treasurer and Assistant Treasurers. The Treasurer shall perform such duties and shall have such powers as may from time to time be assigned by the Board or the Chief Executive Officer. In addition, the Treasurer shall perform such duties and have such powers as are incident to the office of treasurer, including without limitation the duty and power to keep and be responsible for all funds and securities of the Corporation, to deposit funds of the Corporation in depositories selected in accordance with these Bylaws, to disburse such funds as ordered by the Board, to make proper accounts of such funds, and to render as required by the Board statements of all such transactions and of the financial condition of the Corporation.
The Assistant Treasurers shall perform such duties and possess such powers as the Board, the Chief Executive Officer or the Treasurer may from time to time prescribe. In the event of the absence, inability or refusal to act of the Treasurer, the Assistant Treasurer (or if there shall be more than one, the Assistant Treasurers in the order determined by the Board) shall perform the duties and exercise the powers of the Treasurer.
3.12 Salaries. Officers of the Corporation shall be entitled to such salaries, compensation or reimbursement as shall be fixed or allowed from time to time by the Board.
3.13 Delegation of Authority. The Board may from time to time delegate the powers or duties of any officer to any other officer or agent, notwithstanding any provision hereof.
ARTICLE IV
CAPITAL STOCK
4.1 Stock Certificates; Uncertificated Shares. The shares of the Corporation shall be uncertificated shares, provided that the resolution of the Board that the shares of capital stock of the Corporation shall be uncertificated shares shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation (or the transfer agent or registrar, as the case may be). Notwithstanding the foregoing, the Board may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be certificated shares. Every holder of stock of the Corporation represented by certificates shall be entitled to have a certificate, in such form as may be prescribed by law and by the Board, representing the number of shares held by such holder registered in certificate form. Each such certificate shall be signed by or in the name of the Corporation by any two authorized officers of the Corporation and each of the Chief Executive Officer, the President, any Vice President, the Secretary, any Assistant Secretary, the Treasurer and any Assistant Treasurer are duly authorized to sign such certificates
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by, or in the name of, the Corporation, unless otherwise expressly provided in the resolution of the Board electing such officer. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were an officer, transfer agent or registrar at the date of issue
Each certificate for shares of stock which are subject to any restriction on transfer pursuant to the Certificate of Incorporation, these Bylaws, applicable securities laws or any agreement among any number of stockholders or among such holders and the Corporation shall have conspicuously noted on the face or back of the certificate either the full text of the restriction or a statement of the existence of such restriction.
If the Corporation shall be authorized to issue more than one class of stock or more than one series of any class, the powers, designations, preferences and relative participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or back of each certificate representing shares of such class or series of stock, provided that in lieu of the foregoing requirements there may be set forth on the face or back of each certificate representing shares of such class or series of stock a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.
Within a reasonable time after the issuance or transfer of uncertificated shares, the registered owner thereof shall be given a notice, in writing or by electronic transmission, containing the information required to be set forth or stated on certificates pursuant to Sections 151, 156, 202(a) or 218(a) of the DGCL or, with respect to Section 151 of DGCL, a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.
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4.2 Transfers. Shares of stock of the Corporation shall be transferable in the manner prescribed by law, the Certificate of Incorporation and in these Bylaws. Transfers of shares of stock of the Corporation shall be made only on the books of the Corporation or by transfer agents designated to transfer shares of stock of the Corporation. Subject to applicable law, shares of stock represented by certificates shall be transferred only on the books of the Corporation by the surrender to the Corporation or its transfer agent of the certificate representing such shares properly endorsed or accompanied by a written assignment or power of attorney properly executed, and with such proof of authority or the authenticity of signature as the Corporation or its transfer agent may reasonably require. Except as may be otherwise required by law, by the Certificate of Incorporation or by these Bylaws, the Corporation shall be entitled to treat the record holder of stock as shown on its books as the owner of such stock for all purposes, including the payment of dividends and the right to vote with respect to such stock, regardless of any transfer, pledge or other disposition of such stock until the shares have been transferred on the books of the Corporation in accordance with the requirements of these Bylaws.
4.3 Lost, Stolen or Destroyed Certificates. The Corporation may issue a new certificate or uncertificated shares in place of any previously issued certificate alleged to have been lost, stolen or destroyed, upon such terms and conditions as the Board may prescribe, including the presentation of reasonable evidence of such loss, theft or destruction and the giving of such indemnity and posting of such bond sufficient to indemnify the Corporation or any transfer agent or registrar against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares.
4.4 Record Date. In order that the Corporation may determine the stockholders entitled to notice of any meeting of stockholders or any adjournment thereof, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board, and which record date shall, unless otherwise required by law, not be more than sixty (60) nor less than ten (10) days before the date of such meeting. If the Board so fixes a date, such date shall also be the record date for determining the stockholders entitled to vote at such meeting unless the Board determines, at the time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination. If no record date is fixed by the Board, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to
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any adjournment of the meeting; provided, however, that the Board may fix a new record date for determination of stockholders entitled to vote at the adjourned meeting, and in such case shall also fix as the record date for stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote in accordance herewith at the adjourned meeting.
In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board may fix a record date, which shall not be more than sixty (60) days prior to such action. If no such record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto.
4.5 Regulations. The issue and registration of shares of stock of the Corporation shall be governed by such other regulations as the Board may establish.
ARTICLE V
GENERAL PROVISIONS
5.1 Fiscal Year. Except as from time to time otherwise designated by the Board, the fiscal year of the Corporation shall begin on the first day of January of each year and end on the last day of December in each year.
5.2 Corporate Seal. The corporate seal shall be in such form as shall be approved by the Board.
5.3 Waiver of Notice. Whenever notice is required to be given by law, by the Certificate of Incorporation or by these Bylaws, a written waiver signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before, at or after the time of the event for which notice is to be given, shall be deemed equivalent to notice required to be given to such person. Neither the business nor the purpose of any meeting need be specified in any such waiver. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened.
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5.4 Voting of Securities. Except as the Board may otherwise designate, the Chief Executive Officer, the President, the Chief Financial Officer or the Treasurer may waive notice, vote, consent, or appoint any person or persons to waive notice, vote or consent, on behalf of the Corporation, and act as, or appoint any person or persons to act as, proxy or attorney-in-fact for the Corporation (with or without power of substitution and re-substitution), with respect to the securities of any other entity which may be held by this Corporation.
5.5 Evidence of Authority. A certificate by the Secretary, or an Assistant Secretary, or a temporary Secretary, as to any action taken by the stockholders, directors, a committee or any officer or representative of the Corporation shall as to all persons who rely on the certificate in good faith be conclusive evidence of such action.
5.6 Certificate of Incorporation. All references in these Bylaws to the Certificate of Incorporation shall be deemed to refer to the Certificate of Incorporation of the Corporation, as amended and/or restated and in effect from time to time, including any certificate of designation relating to any outstanding series of Preferred Stock.
5.7 Severability. Any determination that any provision of these Bylaws is for any reason inapplicable, illegal or ineffective shall not affect or invalidate any other provision of these Bylaws.
5.8 Pronouns. All pronouns used in these Bylaws shall be deemed to refer to the masculine, feminine or neuter, singular or plural, as the identity of the person or persons may require.
ARTICLE VI
AMENDMENTS
These Bylaws may be altered, amended or repealed, in whole or in part, or new Bylaws may be adopted by the Board or by the stockholders as expressly provided in the Certificate of Incorporation.
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ARTICLE VII
INDEMNIFICATION AND ADVANCEMENT
7.1 Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation. Subject to Section 7.3, the Corporation shall indemnify, to the fullest extent permitted by applicable law, any person (a “Covered Person”) who was or is made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation) by reason of the fact that such Covered Person is or was a director or officer of the Corporation, or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, trustee, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against expenses (including attorneys’ fees), liability and loss, judgments, fines and penalties and amounts paid in settlement actually and reasonably incurred or suffered by such Covered Person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that such person’s conduct was unlawful.
7.2 Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation. Subject to Section 7.3, the Corporation shall indemnify, to the fullest extent permitted by applicable law, any Covered Person who was or is made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that such Covered Person is or was a director or officer of the Corporation, or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, trustee, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by such Covered Person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.
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7.3 Authorization of Indemnification. Any indemnification under this Article VII (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the Covered Person is proper in the circumstances because such Covered Person has met the applicable standard of conduct set forth in Section 7.1 or Section 7.2, as the case may be. Such determination shall be made, with respect to a Covered Person who is a director or officer at the time of such determination, (i) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (ii) by a committee of such directors designated by a majority vote of such directors, even though less than a quorum, or (iii) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion or (iv) by the stockholders. Such determination shall be made, with respect to former directors and officers, by any person or persons having the authority to act on the matter on behalf of the Corporation. To the extent, however, that a Covered Person has been successful on the merits or otherwise in defense of any action, suit or proceeding set forth in Section 7.1 or Section 7.2 or in defense of any claim, issue or matter therein, such Covered Person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith, without the necessity of authorization in the specific case.
7.4 Right of Claimant to Bring Suit. Notwithstanding any contrary determination in the specific case under Section 7.3, and notwithstanding the absence of any determination thereunder, if (i) following the final disposition of the applicable proceeding, a claim for indemnification under Sections 7.1 or 7.2 of this Article VII is not paid in full by the Corporation within ninety (90) days after a written claim for indemnification has been received by the Corporation, or (ii) a claim for advancement of expenses under Section 7.5 of this Article VII is not paid in full by the Corporation within thirty (30) days after the Corporation has received a statement or statements requesting such amounts to be advanced, the Covered Person may at any time thereafter (but not before) bring suit against the Corporation in the Court of Chancery in the State of Delaware to recover the unpaid amount of the claim, together with interest thereon, or to obtain advancement of expenses, as applicable. It shall be a defense to any such action brought to enforce a right to indemnification (but not in an action brought to enforce a right to an advancement of expenses) that the Covered Person has not met the standards of conduct which
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make it permissible under the DGCL (or other applicable law) for the Corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the Corporation. Neither a contrary determination in the specific case under Section 7.3 nor the absence of any determination thereunder shall be a defense to such application or create a presumption that the claimant has not met any applicable standard of conduct. If successful, in whole or in part, the claimant shall also be entitled to be paid the expense of prosecuting such claim, including reasonable attorneys’ fees incurred in connection therewith, to the fullest extent permitted by applicable law.
7.5 Expenses Payable in Advance. Expenses, including without limitation attorneys’ fees, incurred by a Covered Person in defending any civil, criminal, administrative or investigative action, suit or proceeding shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such Covered Person to repay such amount if it shall ultimately be determined that such Covered Person is not entitled to be indemnified by the Corporation as authorized in this Article VII or otherwise.
7.6 Nonexclusivity of Indemnification and Advancement of Expenses. The rights to indemnification and advancement of expenses provided by or granted pursuant to this Article VII shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under the Certificate of Incorporation, any agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office, it being the policy of the Corporation that, subject to Section 7.10, indemnification of Covered Persons shall be made to the fullest extent permitted by law. The provisions of this Article VII shall not be deemed to preclude the indemnification of any person who is not specified in Section 7.1 or 7.2 but whom the Corporation has the power or obligation to indemnify under the provisions of the DGCL or otherwise.
7.7 Insurance. The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power or the obligation to indemnify such person against such expense, liability or loss under the provisions of this Article VII.
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7.8 Certain Definitions. For purposes of this Article VII, references to “the Corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees or agents so that any person who is or was a director or officer of such constituent corporation, or, while a director or officer of such constituent Corporation, is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, shall stand in the same position under the provisions of this Article VII with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Article VII, references to “fines” shall include any excise taxes assessed on a person with respect of any employee benefit plan; and references to “serving at the request of the Corporation” shall include any service as a director, officer, employee or agent of the Corporation which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Corporation” as referred to in this Article VII.
7.9 Survival of Indemnification and Advancement of Expenses. The indemnification and advancement of expenses provided by, or granted pursuant to, this Article VII shall continue as to a Covered Person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such a Covered Person.
7.10 Limitation on Indemnification. Notwithstanding anything contained in this Article VII to the contrary, except for proceedings to enforce rights to indemnification or advancement of expenses (which shall be governed by Section 7.4), the Corporation shall not be obligated to indemnify any Covered Person in connection with an action, suit proceeding (or part thereof) initiated by such person unless such action, suit or proceeding (or part thereof) was authorized by the Board.
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7.11 Contract Rights. The obligations of the Corporation under this Article VII to indemnify, and advance expenses to, a Covered Person who is or was a director or officer of the Corporation shall be considered a contract between the Corporation and such Covered Person, and no modification or repeal of any provision of this Article VII shall affect, to the detriment of such Covered Person, such obligations of the Corporation in connection with a claim based on any act or failure to act occurring before such modification or repeal.
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Exhibit 10.26
EXECUTIVE SEVERANCE AGREEMENT
THIS EXECUTIVE SEVERANCE AGREEMENT (this “Agreement”) is entered into as of [date] (the “Effective Date”), by and between Sunnova Energy International Inc., a Delaware corporation (the “Company”), and [name] (the “Executive”). The parties agree as follows:
ARTICLE 1
PURPOSE AND TERM
1.1 Purpose. The Executive is currently an employee of the Company or its subsidiary. The Company has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication of the Executive, notwithstanding the possibility of a Change in Control of the Company or an involuntary termination of the Executive’s employment. In order to accomplish these objectives, and in consideration of the mutual covenants and agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, hereby enter into this Agreement.
1.2 Term. This Agreement shall be effective as of the Effective Date, and shall remain in effect until the third anniversary of any written notice of termination of the Agreement provided to the Executive by the Company or, if earlier, the Executive’s termination of employment for any reason prior to a Change in Control (the “Term”). Notwithstanding the foregoing, if a Change in Control occurs during the Term, the Term shall end on the later of (i) the date that is two (2) years after the occurrence of the Change in Control, or (ii) the satisfaction of all obligations of the Company arising under this Agreement as a result of the Change in Control.
ARTICLE 2
DEFINITIONS
As used herein, the following words and phrases shall have the following meanings:
2.1 Annual Salary. For purposes of this Agreement, “Annual Salary” shall mean the annual rate of the Executive’s salary applicable as of the Date of Termination or, if higher, the annual rate of the Executive’s salary applicable immediately prior to the Change in Control of the Company.
2.2 Board. For purposes of this Agreement, “Board” shall mean the board of directors of the Company.
2.3 Cause. For purposes of this Agreement, “Cause” shall mean, prior to a Change in Control: (i) the Executive’s willful failure to substantially perform the material duties set forth herein (other than any such failure resulting from the Executive’s Disability); (ii) the Executive’s willful failure to carry out, or comply with, in any material respect any material lawful directive of the Board; (iii) the Executive’s commission at any time of any act or omission that results in, or may reasonably be expected to result in, a conviction, plea of no contest or plea of nolo contendere for a violation of federal securities laws or regulations, any felony, or any crime involving moral
turpitude, excluding driving or traffic-related felonies; (iv) the Executive’s indictment for any driving or traffic-related felony where the effect of such indictment is materially adverse to the Company or its affiliates or their respective operations, reputations or conditions; (v) the Executive’s unlawful use (including being under the influence) or possession of illegal drugs on the Company’s premises or while performing the Executive’s duties and responsibilities hereunder; (vi) the Executive’s commission at any time of any act of fraud, embezzlement, misappropriation, material misconduct, conversion of assets of the Company, or breach of fiduciary duty against the Company (or any predecessor thereto or successor thereof); or (vii) the Executive’s material breach of this Agreement, or any equity award agreement between the Executive and the Company or any other material agreements with the Company (including, without limitation, any breach of the restrictive covenants of any such agreement); and which, in the case of clauses (i), (ii) and (vii), continues beyond thirty (30) days after the Company has provided the Executive written notice of such failure or breach (to the extent that, in the reasonable judgment of the Board, such failure or breach can be cured by the Executive). Notwithstanding the foregoing, after a Change in Control of the Company, “Cause” shall mean: (i) a material breach by the Executive of the duties, obligations and responsibilities of Executive’s position with the Company (other than as a result of incapacity due to physical or mental illness) which is demonstrably willful and deliberate on the Executive’s part, which is committed in bad faith or without reasonable belief that such breach is in the best interests of the Company and which is not remedied in a reasonable period of time after receipt of written notice from the Company specifying such breach, or (ii) the conviction of the Executive of a felony involving moral turpitude. Whether or not an event giving rise to “Cause” had occurred will be determined by the Board.
2.4 Code. For purposes of this Agreement, “Code” shall mean the Internal Revenue Code of 1986, as amended.
2.5 Change in Control. For purposes of this Agreement, a “Change in Control” means each of the following:
(a) the acquisition after the date hereof by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (1) the then outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (2) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, (D) any acquisition previously approved by at least a majority of the members of the Incumbent Board (as such term is hereinafter defined), (E) any acquisition approved by at least a majority of the members of the Incumbent Board within five business days after the Company has notice of such acquisition, or (F) any acquisition by any corporation pursuant to a transaction which complies with clauses (1), (2), and (3) of subsection (c) of this definition; or;
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(b) individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, appointment or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for purposes of this definition, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or
(c) the consummation of a reorganization, share exchange, merger (a “Business Combination”), in each case, unless, following such Business Combination, (1) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination will beneficially own, directly or indirectly, more than 70% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction will own the Company through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (2) no Person (excluding any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) will beneficially own, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination, and (3) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination or were elected, appointed or nominated by the Board; or
(d) (1) approval by the stockholders of the Company of a complete liquidation or dissolution of the Company or (2) the sale or other disposition of all or substantially all of the assets of the Company, other than to a corporation, with respect to which following such sale or other disposition, (A) more than 70% of, respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such sale or other disposition in substantially the same proportion as their ownership, immediately prior to such sale or other disposition, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may
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be, (B) less than 20% of, respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors will be beneficially owned, directly or indirectly, by any Person (excluding any employee benefit plan (or related trust) of the Company or such corporation), except to the extent that such Person owned 20% or more of the Outstanding Company Common Stock or Outstanding Company Voting Securities prior to the sale or disposition, and (C) at least a majority of the members of the board of directors of such corporation were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such sale or other disposition of assets of the Company or were elected, appointed or nominated by the Board.
2.6 Date of Termination. For purposes of this Agreement, “Date of Termination” means (i) if the Executive’s employment is terminated by the Company for Cause, the date of receipt of the notice of termination or any later date specified therein within thirty (30) days of such notice, as the case may be, (ii) if the Executive’s employment is terminated by the Executive for Good Reason, the effective date of such termination pursuant to Section 2.8, (iii) if the Executive’s employment is terminated by the Company other than for Cause or Disability, the date on which the Company notifies the Executive of such termination, (iv) if the Executive voluntarily resigns other than for Good Reason pursuant to Section 2.8, the date on which the Executive notifies the Company of such resignation, (v) if the Executive’s employment is terminated by reason of death, the date of death of the Executive, or (vi) if the Executive’s employment is terminated by the Company due to Disability, the date thirty (30) days after the Company’s written notice to the Executive.
2.7 Disability. For purposes of this Agreement, “Disability” shall mean the absence of the Executive from the Executive’s duties with the Company on a full-time basis for 180 consecutive days as a result of incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive’s legal representative (such agreement as to acceptability not to be withheld unreasonably).
2.8 Good Reason. For purposes of this Agreement, “Good Reason” shall mean any of the following occurring on or after a Change in Control, (i) the assignment to the Executive of any duties inconsistent in any respect with the Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities or any other action by the Company which results in a diminution in such position, authority, duties or responsibilities, in each case when compared to the Executive’s position, authority, duties or responsibilities immediately prior to the Change in Control; (ii) any failure by the Company to provide the Executive with the compensation and/or benefits to which Executive is entitled during employment with the Company, which compensation and/or benefits shall not be less, in the aggregate, than the Executive’s compensation and/or benefits prior to the Change in Control; (iii) the Company’s requiring the Executive to be based at any office or location more than thirty (30) miles away from his or her then current base office or location without the Executive’s consent and reasonable compensation for relocation expenses; (iv) any purported termination by the Company of the Executive’s employment otherwise than as expressly permitted by this Agreement; or (v) any failure by the Company to comply with and satisfy Section 7.6 hereof, provided that such successor
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has received at least ten days, prior written notice from the Company or the Executive of the requirements of Section 7.6 hereof. Executive’s termination shall not be considered for “Good Reason” unless Executive’s termination of employment occurs within twenty-four (24) months after the first occurrence of the facts constituting Good Reason, Executive gave the Company detailed written notice of such facts within 90 days after their first occurrence, and the Company failed to cure such Good Reason within 30 days after it received such detailed written notice. For purposes of this Section 2.8, any good faith determination of “Good Reason” made by the Executive shall be conclusive. For the avoidance of doubt, the Executive shall not have Good Reason to terminate employment prior to the occurrence of a Change in Control and any termination or resignation of employment by the Executive prior to the occurrence of a Change in Control will be deemed to be a voluntary resignation.
2.9 Target Annual Bonus. For purposes of this Agreement, “Target Annual Bonus” shall mean the greater of (1) Executive’s target annual cash bonus opportunity, determined by the Board in its sole discretion, for the fiscal year in which the Date of Termination occurs or, if no target annual bonus has been established for the fiscal year in which the Date of Termination occurs, the target annual bonus for the preceding fiscal year or (2) Executive’s target annual cash bonus for the fiscal year in which the Change in Control of the Company occurs.
ARTICLE 3
COMPANY OBLIGATIONS UPON TERMINATION OF EMPLOYMENT
3.1 In General. If the Executive’s employment with the Company terminates due to circumstances other than those set forth in Section 3.2, this Agreement shall terminate; provided, however, that in any such event, the Company shall pay to the Executive (or the Executive’s estate, as applicable) (i) in a lump sum within thirty (30) days of the Date of Termination, any portion of the Annual Salary and accrued but unused vacation that shall have been earned by the Executive prior to the termination but not yet paid; (ii) the amount of any unpaid annual bonus earned for the calendar year completed prior to the Date of Termination, payable on or prior to March 15 of the calendar year immediately following the completed year for which the annual bonus was earned; (iii) any benefits that have vested in the Executive as of the Date of Termination as a result of the Executive’s participation in any of the Company’s benefit plans; (iv) any accrued but unused vacation pay; and (v) any expenses with respect to which the Executive is entitled to reimbursement under Company policy (collectively, the “Accrued Amounts”).
3.2 Termination For Cause . The Company has the right, at any time, subject to all of the provisions hereof, exercisable by serving notice, effective on or after the date of service of such notice as specified therein, to terminate the Executive’s employment under this Agreement and discharge the Executive for Cause. If such right is exercised, the Company’s obligation to the Executive shall be limited solely to (i) the payment of any portion of the Annual Salary that shall have been earned by the Executive prior to the termination but not yet paid in a lump sum within thirty (30) days of the Date of Termination and (ii) any benefits that have vested in the Executive as of the Date of Termination as a result of the Executive’s participation in any of the Company’s benefit plans.
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3.3 Termination by the Company Without Cause Prior to a Change in Control. The Company has the right, at any time, subject to all of the provisions hereof, exercisable by serving notice, effective on or after the date of service of such notice as specified therein, to terminate the Executive’s employment under this Agreement and discharge the Executive without Cause. If the Company terminates the Executive’s employment without Cause prior to a Change in Control of the Company then the Company’s obligation to the Executive shall be limited solely to the following, and shall be contingent on Executive’s execution of a general waiver and release as described in Section 3.3(c) below:
(a) Severance Payments. The Company shall pay the Executive:
| (i) | the Accrued Amounts (payable at the same time and in the same manner as set forth in Section 3.1); |
| (ii) | an amount equal to the Target Bonus multiplied by a fraction, (x) the numerator of which is equal to the number of days that the Executive was employed during the calendar year in which the Date of Termination occurs and (y) the denominator of which is 365; and |
| (iii) | an amount equal to 50% times Executive’s Annual Base Salary; |
with any amounts payable under Section 3.01(a)(ii) or (iii) payable in equal installments over the six month period beginning on the Date of Termination in accordance with the normal payroll practices of the Company.
(b) Extension of Health Plan Benefits. If the Executive is eligible to and does elect continuation coverage under the Company’s health benefit plan pursuant to the provisions of Section 4980B of the Code, then the Company shall reimburse to the Executive the excess of (A) the premiums paid for such coverage by the Executive during 6 months period following the Date of Termination in which the Executive elects such continuation coverage under the Company’s health benefit plan over (B) the premiums for comparable coverage charged to the Company’s active employees during such period, provided that such reimbursements shall not be made in the event the Company would be subject to any excise tax under Section 4980D of the Code or other penalty or liability pursuant to the provisions of the Patient Protection and Affordable Care Act of 2010 (as amended from time to time), and in lieu of providing the subsidized premiums described above, the Company shall instead pay to the Executive a fully taxable monthly cash payment in an amount such that, after payment by the Executive of all taxes on such payment, the Executive retains an amount equal to the applicable premiums for such month, with such monthly payment being made on the last day of each month for the remainder of the period for which the premium reimbursement would have been provided; provided further that in the event that the Executive obtains other employment that offers group health benefits, such reimbursement shall immediately cease.
(c) Waiver and Release Required; Forfeiture and Repayment on Breach. Notwithstanding anything herein to the contrary, no portion of the payments or benefits described in Section 3.3(a)(ii) or (iii) or Section 3.3(b) shall be paid unless, on or prior to the sixtieth (60th) day following the Date of Termination, the Executive timely executes a general waiver and release of claims agreement in substantially the form attached here to
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as Exhibit A (which release shall not require the Executive to release or waive any vested benefits or claims that arise for the first time after the effective date of the release), and such release shall not have been revoked by the Executive prior to the expiration of the period (if any) during which any portion of such release is revocable under applicable law and as of the first date on which the Executive violates any covenant contained in Article V, any remaining unpaid benefits under this Agreement shall thereupon be forfeited and any benefits already paid under Sections 3.3(a)(ii), 3.3(a)(iii) or 3.3(b) must be repaid to the Company immediately upon demand .
3.4 Termination by the Company Without Cause or by the Executive for Good Reason Following a Change in Control. If the Company terminates the Executive’s employment without Cause or the Executive terminates the Executive’s employment for Good Reason, provided that the foregoing terminations occur within twenty-four (24) months after a Change in Control of the Company, then the Company’s obligation to the Executive shall be limited solely to the following (in lieu of the provisions set forth in Section 3.3):
(a) Severance Payments. The Company shall pay the Executive:
| (i) | the Accrued Amounts (payable at the same time and in the same manner as set forth in Section 3.1); |
| (ii) | in lump sum on the sixtieth (60th) day after the Date of Termination, an amount equal to the Target Bonus multiplied by a fraction, (x) the numerator of which is equal to the number of days that the Executive was employed during the calendar year in which the Date of Termination occurs and (y) the denominator of which is 365; and |
| (iii) | in lump sum on the sixtieth (60th) day after the Date of Termination, an amount equal to (1) [applicable multiple] times the Executive’s Annual Salary, plus (2) [applicable multiple] times the Executive’s Target Annual Bonus. |
(b) Extension of Health Plan Benefits. The Company shall provide to Executive and/or Executive’s spouse and family, as the case may be, continued participation in the group health plans in which Executive and/or Executive’s spouse or family, as the case may be, participated in immediately prior to the Date of Termination, but not less benefits, in the aggregate, than Executive and/or Executive’s spouse and family received immediately prior to the Change of Control as if Executive’s employment had not terminated and at no cost to the Executive (the “Welfare Continuation Benefit”). The Welfare Continuation Benefit shall be provided for the period beginning on the Date of Termination and ending on the date that is eighteen (18) months after the Date of Termination, provided that such Welfare Benefit Continuation shall not be made in the event the Company would be subject to any excise tax under Section 4980D of the Code or other penalty or liability pursuant to the provisions of the Patient Protection and Affordable Care Act of 2010 (as amended from time to time), and in lieu of providing the Welfare Benefit Continuation described above, the Company shall instead pay to the Executive a fully taxable monthly cash payment in an amount such that, after payment by
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the Executive of all taxes on such payment, the Executive retains an amount equal to the applicable premiums for such month, with such monthly payment being made on the last day of each month for the remainder of the period for which the Welfare Continuation Benefit would have been provided.
(c) Option Exercise. Any stock options held by the Executive as of the Change in Control of the Company that remain outstanding as of the Date of Termination may thereafter be exercised until the later of (A) the last date on which such stock options would be exercisable in the absence of this Section 3.4(c) or (B) the first anniversary of the Date of Termination. Notwithstanding the preceding sentence, in no event will any stock options remain exercisable later than the earlier of (i) the original expiration date of such stock options or (ii) the tenth anniversary of the original grant date for such stock options.
3.5 Termination upon Death or Disability. If the Executive’s employment is terminated due to Death or Disability, the Company’s obligation to the Executive shall be limited solely to the payment of the Accrued Amounts (at the same time and in the same manner as set forth in Section 3.1) and, if such termination occurs after a Change in Control, provision of the Welfare Continuation Benefit.
ARTICLE 4
PARACHUTE PAYMENTS
4.1 Parachute Payments. It is the objective of this Agreement to maximize the Executive’s Net After-Tax Benefit (as defined herein) if payments or benefits provided under this Agreement are subject to excise tax under Section 4999 of Code. Therefore, in the event it is determined that any payment or benefit by the Company to or for the benefit of the Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, including, by example and not by way of limitation, acceleration by the Company or otherwise of the date of vesting or payment or rate of payment under any plan, program or arrangement of the Company, would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), the Company shall first make a calculation under which such payments or benefits provided to the Executive under this Agreement are reduced to the extent necessary so that no portion thereof shall be subject to the excise tax imposed by Section 4999 of the Code (the “4999 Limit”). The Company shall then compare (x) the Executive’s Net After-Tax Benefit assuming application of the 4999 Limit with (y) the Executive’s Net After-Tax Benefit without the application of the 4999 Limit and the Executive shall be entitled to the greater of (x) or (y). “Net After-Tax Benefit” shall mean the sum of (i) all payments and benefits which the Executive receives or is then entitled to receive from the Company, less (ii) the amount of federal income taxes payable with respect to the payments and benefits described in (i) above calculated at the maximum marginal income tax rate for each year in which such payments and benefits shall be paid to the Executive (based upon the rate for such year as set forth in the Code at the time of the first payment of the foregoing), less (iii) the amount of excise taxes imposed with respect to the payments and benefits described in (i) above by Section 4999 of the Code. The determination of whether a payment or benefit constitutes an excess parachute payment shall be made by tax counsel selected by the Company and reasonably acceptable to the Executive. The costs of obtaining this determination shall be borne by the Company.
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ARTICLE 5
PROTECTIVE COVENANTS
5.1 Provision of Confidential and Proprietary Information. The Company will provide the Executive with access to its confidential, proprietary or trade secret information, including Proprietary Information (as defined in Section 5.4) and confidential information of third parties such as customers, suppliers and business affiliates, specialized training and knowledge regarding their methodologies and business strategies, and support in the development of goodwill such as introductions and customer relationship information. The foregoing is not contingent on continued employment, but upon the Executive’s use of the access, specialized training and goodwill support provided by the Company for the exclusive benefit of the Company and upon the Executive’s full compliance with the restrictions on the Executive’s conduct provided for in this Agreement. Ancillary to the rights provided to the Executive as set forth in this Agreement, the provision by the Company of confidential, proprietary and trade secret information, specialized training and goodwill support to the Executive, and the Executive’s agreements regarding the use of same, in order to protect the value of any equity-based compensation, training, goodwill support and the confidential information described above, the Company and the Executive agree to the following provisions against unfair competition, which the Executive acknowledges represent a fair balance of the Company’s rights to protect its business and the Executive’s right to pursue employment and would not create a hardship to the Executive or his or her family if and when enforced.
5.2 Non-Competition. The Executive hereby agrees that, in the event of a termination of the Executive’s employment prior to the occurrence of a Change in Control, the Executive shall not, at any time during the 6 month period beginning on the Date of Termination (the “Restricted Period”), directly or indirectly engage in, have any equity interest in, or manage or operate any Person, firm, corporation, partnership, business or entity (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in, in the Restricted Area (either directly or through any subsidiary or Affiliate thereof), any business or activity (i) in the Business, (ii) that otherwise competes with the business of the Company or any entity owned by the Company or (iii) with respect to which the Company or any entity owned by the Company has taken Active Steps at any time during the twelve (12) month period immediately before the Date of Termination (any such business or activity, a “Restricted Business”). Notwithstanding the foregoing, the Executive shall be permitted to acquire a passive stock or equity interest in a Restricted Business; provided that such stock or other equity interest acquired is not more than five percent (5%) of the outstanding interest in such Restricted Business. For purposes of this Agreement, “Restricted Area” means (i) the United States, Canada or any territory of either of the foregoing, (ii) any other location where the Company or any of its direct or indirect subsidiaries engages in business or (iii) any other location where the Company or any of its direct or indirect subsidiaries has taken Active Steps at any time during the twelve (12) month period immediately before the Date of Termination. For purposes of this Agreement, “Business” shall mean (i) the business of acquisition, development, construction and/or origination, financing, management and disposition of distributed (including, without limitation, residential, commercial, community solar and industrial) solar energy production and storage equipment and related leases, loans or other financing instruments or arrangements and the actions and transactions related or ancillary thereto and (ii) such other lines of business in which the Company or any entity owned by the Company are materially engaged on the date of the Executive’s Date of Termination.
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5.3 Non-Solicitation. The Executive hereby agrees that, in the event of a termination of the Executive’s employment prior to the occurrence of a Change in Control, the Executive shall not, at any time during the Restricted Period, directly or indirectly, either for himself or herself or on behalf of any other Person (other than the Company), (i) recruit or otherwise solicit or induce any employee, consultant, independent contractor, customer, subscriber, vendor (including, without limitation, installation contractors), deal source, deal contact or supplier of the Company to terminate its employment or arrangement with the Company, or otherwise change its relationship with the Company, or (ii) hire, or cause to be hired, any person who was employed or engaged by the Company at any time during the twelve (12)-month period immediately prior to the Date of Termination or who thereafter becomes employed by the Company; provided, however, that this restriction shall not extend to, prohibit or otherwise limit general employment advertising or solicitation not specifically targeting employees of the Company or any such specific employee.
5.4 Confidentiality; Non-disclosure. Except as the Executive reasonably and in good faith determines to be required in the faithful performance of the Executive’s duties hereunder or in accordance with Section 5.6, the Executive shall, during the Term and after the Date of Termination, maintain in confidence and shall not directly or indirectly, use, disseminate, disclose or publish, for the Executive’s benefit or the benefit of any other Person, any confidential or proprietary information or trade secrets of or relating to or received by the Company, including, without limitation, information with respect to the Company’s operations, processes, protocols, products, inventions, business practices, finances, principals, vendors (including, without limitation, installation contractors), suppliers, customers, potential customers, subscribers, potential subscribers, deal sources, deal contacts, marketing methods, costs, prices, contractual relationships, regulatory status, compensation paid to employees or other terms of employment (“Proprietary Information”), or deliver to any Person, any document, record, notebook, computer program or similar repository of or containing any such Proprietary Information. The Executive’s obligation to maintain and not use, disseminate, disclose or publish, or use for the Executive’s benefit or the benefit of any other Person, any Proprietary Information after the Date of Termination will continue so long as such Proprietary Information is not, or has not by legitimate means become, generally known and in the public domain (other than by means of the Executive’s direct or indirect disclosure of such Proprietary Information) and continues to be maintained as Proprietary Information by the Company. The parties hereby stipulate and agree that as between them, the Proprietary Information identified herein is important, material and affects the successful conduct of the businesses of the Company (and any successor or assignee of the Company).
5.5 Return of Company Property. Upon termination of the Executive’s employment with the Company for any reason, the Executive will promptly deliver to the Company (i) all correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents and any other documents that are Proprietary Information, including all physical and digital copies thereof, and (ii) all other Company property (including, without limitation, any personal computer or wireless device and related accessories, keys, credit cards and other similar items) that is in his possession, custody or control.
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5.6 Notice; Cooperation. The Executive may respond to a lawful and valid subpoena or other legal process but shall give the Company the earliest possible notice thereof, and shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and other information sought, and shall assist such counsel in resisting or otherwise responding to such process.
5.7 Non-Disparagement. The Executive agrees not to disparage the Company, any of its products or practices, or any of its directors, officers, agents, representatives, partners, members, equity holders or Affiliates, either orally or in writing, at any time; provided that the Executive may confer in confidence with the Executive’s legal representatives and make truthful statements as required by law. The Company agrees not to disparage the Executive, either orally or in writing, at any time; provided that such directors and officers may confer in confidence with the Company’s and their respective legal representatives and make truthful statements as required by law. Notwithstanding the forgoing, nothing in this Agreement shall restrict in any way the communication of information by Executive, the Company or any of its officers, directors, employees, stockholders, agents and representatives to any local, state or federal law enforcement agency or require notice to the other party thereof.
5.8 Interpretation of Covenants. Prior to accepting other employment or any other service relationship during the Noncompetition Restricted Period, the Executive shall provide a copy of this Article 5 to any recruiter who assists the Executive in obtaining other employment or any other service relationship and to any employer or other Person with which the Executive discusses potential employment or any other service relationship.
In the event the terms of this Article 5 shall be determined by any court of competent jurisdiction to be unenforceable by reason of its extending for too great a period of time or over too great a geographical area or by reason of its being too extensive in any other respect, it will be interpreted to extend only over the maximum period of time for which it may be enforceable, over the maximum geographical area as to which it may be enforceable, or to the maximum extent in all other respects as to which it may be enforceable, all as determined by such court in such action. Any breach or violation by the Executive of the provisions of this Article 5 shall toll the running of any time periods set forth in this Article 5 for the duration of any such breach or violation.
As used in this Article 5, the term “Company” shall mean Sunnova Energy International Inc., its predecessors or successor, related entities and any of its direct or indirect subsidiaries.
5.9 Injunctive Relief. The Executive recognizes and acknowledges that a breach of the covenants contained in this Article 5 will cause irreparable damage to the Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, the Executive agrees that in the event of a breach of any of the covenants contained in this Article 5, in addition to any other remedy which may be available at law or in equity, the Company will be entitled to specific performance and injunctive relief.
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ARTICLE 6
INSURANCE
6.1 Insurance. The Company shall secure and maintain Director’s and Officer’s liability insurance covering Executive. The Company may, from time to time, apply for and take out, in its own name and at its own expense, naming itself or one or more of its affiliates as the designated beneficiary (which it may change from time to time), policies for life, health, accident, disability or other insurance upon the Executive in any amount or amounts that it may deem necessary or appropriate to protect its interest. The Executive agrees to aid the Company in procuring such insurance by submitting to medical examinations and by completing, executing and delivering such applications and other instruments in writing as may reasonably be required by an insurance company or companies to which any application or applications for insurance may be made by or for the Company.
ARTICLE 7
OTHER PROVISIONS
7.1 Section 409A.
(a) Separation from Service. Notwithstanding anything to the contrary in this Agreement, with respect to any amounts payable to Executive under this Agreement in connection with a termination of Executive’s employment that would be considered “non-qualified deferred compensation” under Section 409A of the Code, in no event shall a termination of employment be considered to have occurred under this Agreement unless such termination constitutes Executive’s “separation from service” with the Company as such term is defined in Treasury Regulation Section 1.409A-1(h), and any successor provision thereto (“Separation from Service”).
(b) Section 409A Compliance. Notwithstanding anything to the contrary in this Agreement, to the maximum extent permitted by applicable law, any severance payments payable to Executive under this Agreement shall be made in reliance upon Treasury Regulation Section 1.409A-1(b)(9)(iii) (relating to separation pay plans) or Treasury Regulation Section 1.409A-1(b)(4) (relating to short-term deferrals). However, to the extent any such payments are treated as “non-qualified deferred compensation” subject to Section 409A of the Code, and if Executive is deemed at the time of his Separation from Service to be a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code, then to the extent delayed commencement of any portion of the benefits to which Executive is entitled under this Agreement is required in order to avoid a prohibited payment under Section 409A(a)(2)(B)(i) of the Code, such portion of Executive’s termination benefits shall not be provided to the Executive prior to the earlier of (i) the expiration of the six-month period measured from the date of Executive’s Separation from Service or (ii) the date of Executive’s death. Upon the earlier of such dates, all payments deferred pursuant to this Section shall be paid in a lump sum to Executive (or Executive’s estate). The determination of whether Executive is a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code as of the time of his Separation from Service shall be made by Company in accordance with the terms of Section 409A of the Code, and applicable guidance thereunder (including without limitation Treasury Regulation
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Section 1.409A-1(i) and any successor provision thereto). Notwithstanding anything in this Agreement to the contrary, to the extent the Company determines necessary to comply with the requirements of Section 409A of the Code with respect to any payment under this Agreement, no “Change in Control” shall be deemed to occur unless and until the event also satisfies the requirements of a “change in control event” within the meaning of Section 409A of the Code and applicable regulations. With respect to any of Executive’s awards of, or relating to, equity of the Company that are outstanding as of the Effective Date or are granted to Executive in the future (“Awards”), such Awards shall be administered in a manner that is either compliant with or exempt from the requirements of Section 409A of the Code, and the Change in Control definition applicable to such Awards shall, to the extent necessary to comply with Section 409A of the Code, be limited to an event that satisfies the requirements of a “change in control event” within the meaning of Section 409A of the Code and applicable regulations.
(c) Section 409A; Separate Payments. This Agreement is intended to be written, administered, interpreted and construed in a manner such that no payment or benefits provided under the Agreement become subject to (a) the gross income inclusion set forth within Section 409A(a)(1)(B) of the Code or (b) the interest and additional tax set forth within Section 409A(a)(1)(B) of the Code (collectively, “Section 409A Penalties”), including, where appropriate, the construction of defined terms to have meanings that would not cause the imposition of Section 409A Penalties. For purposes of Section 409A of the Code (including, without limitation, for purposes of Treasury Regulation Section 1.409A-2(b)(2)(iii)), each payment that Executive may be eligible to receive under this Agreement shall be treated as a separate and distinct payment and shall not collectively be treated as a single payment.
(d) In-kind Benefits and Reimbursements. Notwithstanding anything to the contrary in this Agreement or in any Employer policy with respect to such payments, in- kind benefits and reimbursements provided under this Agreement during any tax year of Executive shall not affect in-kind benefits or reimbursements to be provided in any other tax year of Executive and are not subject to liquidation or exchange for another benefit. Notwithstanding anything to the contrary in this Agreement, reimbursement requests must be timely submitted by Executive and, if timely submitted, reimbursement payments shall be made to Executive as soon as administratively practicable following such submission in accordance with the Company’s policies regarding reimbursements, but in no event later than the last day of Executive’s taxable year following the taxable year in which the expense was incurred. This Section 7.1(d) shall only apply to in-kind benefits and reimbursements that would result in taxable compensation income to Executive.
7.2 Notices. Any notice or other communication required or permitted hereunder shall be in writing and shall be delivered personally, sent by courier service, sent by facsimile transmission or sent by certified, registered or express mail, postage prepaid. Any such notice shall be deemed given when so delivered personally or sent by facsimile transmission or, if mailed or sent by courier service, on the date of actual receipt thereof, as follows:
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| (1) | if to the Company, to: | |||||
| Sunnova Energy International Inc. | ||||||
| 20 East Greenway Plaza, Suite 475 | ||||||
| Houston, TX 77046 | ||||||
| Attn: General Counsel | ||||||
| (2) | if to the Executive, to: | |||||
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Any party may change its address for notice hereunder by notice to the other party hereto.
7.3 Entire Agreement. This Agreement contains the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements (including but not limited to the Employment Agreement between the Executive and Sunnova Energy Corporation dated as of ), written or oral, with respect thereto. Notwithstanding the foregoing, this Agreement does not supersede any indemnification agreements between Executive and the Company and any contrary terms under applicable Company equity incentive plans. The Executive acknowledges and agrees that the Executive shall not be entitled to participate in any Company severance plans, including, but not limited to, the Sunnova Energy International Inc. Change in Control Severance Plan, and shall not be entitled to severance benefits except as provided in this Agreement.
7.4 Waivers and Amendments. This Agreement may be amended, superseded, canceled, renewed or extended, and the terms and conditions hereof may be waived, only by a written instrument signed by the parties or, in the case of a waiver, by the party waiving compliance. No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any waiver on the part of any party of any such right, power or privilege hereunder, nor any single or partial exercise of any right, power or privilege hereunder, preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.
7.5 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware (without giving effect to the choice of law provisions thereof) where the employment of the Executive shall be deemed, in part, to be performed. Enforcement of this Agreement or any action taken or held with respect to this Agreement shall be taken in the courts of appropriate jurisdiction in Harris County, Texas.
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7.6 Assignment. This Agreement, and any rights and obligations hereunder, may not be assigned by the Executive and may be assigned by the Company only to a successor by merger or purchasers of substantially all of the assets of the Company or its affiliates. The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes this Agreement by operation of law, or otherwise.
7.7 Counterparts. This Agreement may be executed in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all of which together shall constitute one and the same instrument.
7.8 Headings. The headings in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.
7.9 No Presumption Against Interest. This Agreement has been negotiated, drafted, edited and reviewed by the respective parties, and therefore, no provision arising directly or indirectly herefrom shall be construed against any party as being drafted by said party.
7.10 No Duty to Mitigate. The Executive shall have no obligation to mitigate damages suffered as a result of termination of the Executive’s employment with the Company. The provisions of this Section 7.10 shall survive termination of this Agreement.
7.11 Resolution of Disputes. Following a Change in Control, if there shall be any dispute between the Company and the Executive (i) in the event of any termination of the Executive’s employment by the Company for any reason other than death, or (ii) in the event of any termination of employment by the Executive or determination of whether Good Reason existed, then, unless and until there is a final, nonappealable judgment by a court of competent jurisdiction declaring that such termination by the Company was for Cause or Disability or that the determination by the Executive of the existence of Good Reason was not made in good faith, as the case may be, the Company shall pay all amounts, and provide all benefits, to the Executive and/or the Executive’s family or other beneficiaries, as the case may be, that the Company would be required to pay or provide pursuant to Section 3 as though such termination were by the Company without Cause and not for Disability or by the Executive with Good Reason; provided, however, that the Company shall not be required to pay any disputed amounts pursuant to this Section except upon receipt of an undertaking by or on behalf of the Executive and/or the Executive’s family or other beneficiaries, as the case may be, to repay all such amounts to which the Executive is ultimately adjudged by such court not to be entitled.
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7.12 Binding Agreement. Subject to Section 7.6, this Agreement shall inure to the benefit of and be binding upon the Company and its respective successors and assigns and the Executive and the Executive’s legal representatives.
7.13 Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state and local taxes as may be required to be withheld pursuant to any applicable law or regulation and any deductions authorized by Executive.
7.14 Attorney’s Fees and Costs. Following a Change in Control, if the Company breaches any provision of this Agreement in any respect, then the Company shall reimburse or advance to the Executive the funds necessary for payment of costs and expenses, including attorneys’ fees and disbursements, incurred in connection with any proceeding in advance of the final disposition of such proceeding incurred by the Executive in enforcing this Agreement, provided that the Executive shall be entitled to advancement of Executive’s costs and expenses only upon receipt by the Company of an undertaking, by or on behalf of the Executive, to repay any such amount so advanced if it shall ultimately be determined after the case is final and all appeals have been exhausted (or the election has been made not to file appeals) by a final judgment or award that the Company has obtained in its favor against all of Executive’s claims against the Company.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
| EXECUTIVE | ||
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[NAME] | ||
| COMPANY | ||
| SUNNOVA ENERGY INTERNATIONAL INC. | ||
| By: |
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| Name: |
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| Title: |
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Exhibit A: Form of Waiver and Release
In consideration of, and as a condition precedent to, the severance payment and benefits (the “Severance”) described in that certain Executive Severance Agreement (the “Agreement”) effective as of [ ] between Sunnova Energy International Inc., a Delaware Corporation (the “Company”), and (“Employee”)], which Severance is offered to Employee in exchange for a general waiver and release of claims (this “Waiver and Release”). Employee having acknowledged the above-stated consideration as full compensation for and on account of any and all injuries and damages which Employee has sustained or claimed, or may be entitled to claim, Employee, for himself, and his heirs, executors, administrators, successors and assigns, does hereby release, forever discharge and promise not to sue the Company, its parents, subsidiaries, affiliates, successors and assigns, and their past and present officers, directors, partners, employees, members, managers, shareholders, agents, attorneys, accountants, insurers, heirs, administrators, executors, as well as all employee benefit plans maintained by any of the foregoing entities or individuals, and all fiduciaries and administrators of such plans, in their personal and representative capacities (collectively the “Released Parties”) from any and all claims, liabilities, costs, expenses, judgments, attorney fees, actions, known and unknown, of every kind and nature whatsoever in law or equity, which Employee had, now has, or may have against the Released Parties relating in any way to Employee’s employment with the Company or termination thereof prior to and including the date of execution of this Waiver and Release, including but not limited to, all claims for contract damages, tort damages, special, general, direct, punitive and consequential damages, compensatory damages, loss of profits, attorney fees and any and all other damages of any kind or nature; all contracts, oral or written, between Employee and any of the Released Parties; any business enterprise or proposed enterprise contemplated by any of the Released Parties, as well as anything done or not done prior to and including the date of execution of this Waiver and Release.
Employee understands and agrees that this release and covenant not to sue shall apply to any and all claims or liabilities arising out of or relating to Employee’s employment with the Company or any affiliate and the termination of such employment, including, but not limited to: claims of discrimination based on age, race, color, sex (including sexual harassment), religion, national origin, marital status, parental status, veteran status, union activities, disability or any other grounds under applicable federal, state or local law prior to and including the date of execution of this Waiver and Release, including, but not limited to, claims arising under the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act, the Family and Medical Leave Act, Title VII of the Civil Rights Act, the Civil Rights Act of 1991, 42 U.S.C. § 1981, the Genetic Information Non-Discrimination Act of 2008, the Employee Retirement Income Security Act of 1974, the Consolidated Omnibus Budget Reconciliation Act of 1985, the Rehabilitation Act of 1973, the Equal Pay Act of 1963 (EPA), all as amended, as well as any claims prior to and including the date of execution of this Waiver and Release, regarding wages; benefits; vacation; sick leave; business expense reimbursements; wrongful termination; breach of the covenant of good faith and fair dealing; intentional or negligent infliction of emotional distress; retaliation; outrage; defamation; invasion of privacy; breach of contract; fraud or negligent misrepresentation; harassment; breach of duty; negligence; discrimination; claims under any employment, contract or tort laws; claims arising under any other federal law, state law, municipal law, local law, or common law; any claims arising out of any employment contract, policy or procedure; and any other claims related to or arising out of his employment or the separation of his employment with the Company or any affiliate prior to and including the date of execution of this Waiver and Release.
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In addition, Employee agrees not to cause or encourage any legal proceeding to be maintained or instituted against any of the Released Parties, save and except proceedings to enforce the terms of the Agreement or claims of Employee not released by and in this Waiver and Release.
Notwithstanding anything to the contrary contained in this Waiver and Release, nothing in this Waiver and Release shall be construed to release the Company from (i) any obligations set forth in the Agreement, (ii) claims that relate to events that arise after the execution of this Waiver and Release, or (iii) any claim or right held by Employee (whether as an employee, officer, director, stockholder or in any other capacity) for coverage under the Company’s or any affiliate’s D&O policies or any similar coverage or protection provided under the organizational documents of the Company or any affiliate. This release does not apply to any claims for unemployment compensation or any other claims or rights which, by law, cannot be waived, including the right to file an administrative charge or participate in an administrative investigation or proceeding; provided, however, that Employee disclaims and waives any right to share or participate in any monetary award from the Company resulting from the prosecution of such charge or investigation or proceeding. Notwithstanding the foregoing or any other provision in this Waiver and Release or the Agreement to the contrary, the Company and Employee further agree that nothing in this Waiver and Release or the Agreement (i) limits Employee’s ability to file a charge or complaint with the EEOC, the NLRB, OSHA, the SEC or any other federal, state or local governmental agency or commission (each a “Government Agency” and collectively “Government Agencies”); (ii) limits Employee’s ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information and reporting possible violations of law or regulation or other disclosures protected under the whistleblower provisions of applicable law or regulation, without notice to the Company; or (iii) limits Employee’s right to receive an award for information provided to any Government Agencies.
Employee expressly acknowledges that he is voluntarily, irrevocably and unconditionally releasing and forever discharging the Company and the other Released Parties from all rights or claims he has or may have against the Released Parties, including, but not limited to, without limitation, all charges, claims of money, demands, rights, and causes of action arising under the Age Discrimination in Employment Act of 1967, as amended (“ADEA”), up to and including the date Employee signs this Waiver and Release including, but not limited to, all claims of age discrimination in employment and all claims of retaliation in violation of ADEA. Employee further acknowledges that the consideration given for this waiver of claims under the ADEA is in addition to anything of value to which he was already entitled in the absence of this waiver. Employee further acknowledges: (a) that he has been informed by this writing that he should consult with an attorney prior to executing this Waiver and Release; (b) that he has carefully read and fully understands all of the provisions of this Waiver and Release; (c) he is, through this Waiver and Release, releasing the Company and the other Released Parties from any and all claims he may have against any of them; (d) he understands and agrees that this waiver and release does not apply to any claims that may arise under the ADEA after the date he executes this Waiver and Release; (e) he has at least [twenty-one (21)] [forty-five (45)] days within which to consider this
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Waiver and Release; and (f) he has seven (7) days following his execution of this Waiver and Release to revoke the Waiver and Release; and (g) this Waiver and Release shall not be effective until the revocation period has expired and Employee has signed and has not revoked the Waiver and Release.
Employee acknowledges and agrees that: (a) he has had reasonable and sufficient time to read and review this Waiver and Release and that he has, in fact, read and reviewed this Waiver and Release; (b) that he has the right to consult with legal counsel regarding this Waiver and Release and is encouraged to consult with legal counsel with regard to this Waiver and Release; (c) that he has had (or has had the opportunity to take) [twenty-one (21)] [forty-five (45)] calendar days to discuss the Waiver and Release with a lawyer of his choice before signing it and, if he signs before the end of that period, he does so of his own free will and with the full knowledge that he could have taken the full period; (d) that he is entering into this Waiver and Release freely and voluntarily and not as a result of any coercion, duress or undue influence; (e) that he is not relying upon any oral representations made to him regarding the subject matter of this Waiver and Release; (f) that by this Waiver and Release he is receiving consideration in addition to that which he was already entitled; and (g) that he has received all information he requires from the Company in order to make a knowing and voluntary release and waiver of all claims against the Company and the other Released Parties.
Employee acknowledges and agrees that he has seven (7) days after the date he signs this Waiver and Release in which to rescind or revoke this Waiver and Release by providing notice in writing to the Company. Employee further understands that the Waiver and Release will have no force and effect until the end of that seventh day (the “Waiver Effective Date”). If Employee revokes the Waiver and Release, the Company will not be obligated to pay or provide Employee with the benefits described in this Waiver and Release, and this Waiver and Release shall be deemed null and void.
| AGREED TO AND ACCEPTED this |
| ______ day of _________________, 20__. |
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[Name] |
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