As filed with the Securities and Exchange Commission on November 13, 2017
Registration No. 333-221036
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
SailPoint Technologies Holdings, Inc.
(Exact name of registrant as specified in its charter)
Delaware | 7372 | 47-1628077 | ||
(State or other jurisdiction of
incorporation or organization) |
(Primary Standard Industrial
Classification Code Number) |
(I.R.S. Employer
Identification No.) |
11305 Four Points Drive, Building 2, Suite 100
Austin, TX 78726
(512) 346-2000
(Address, including zip code, and telephone number, including area code, of registrants principal executive offices)
Christopher Schmitt
General Counsel
SailPoint Technologies Holdings, Inc.
11305 Four Points Drive, Building 2, Suite 100
Austin, TX 78726
(512) 346-2000
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Paul R. Tobias J. Wesley Jones Lanchi D. Huynh Vinson & Elkins L.L.P. 2801 Via Fortuna, Suite 100 Austin, TX 78746 (512) 542-8400 |
Gerald T. Nowak, P.C. Bradley C. Reed Kirkland & Ellis LLP 300 North LaSalle Chicago, IL 60654 (312) 862-2000 |
Kenneth J. Gordon Joseph C. Theis, Jr. Goodwin Procter LLP 100 Northern Avenue Boston, MA 02210 (617) 570-1000 |
Approximate date of commencement of proposed sale of the securities to the public:
As soon as practicable after the effective date of this Registration Statement.
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 of 1933, 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, 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 ☒ | ||||
(Do not check if a smaller reporting 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. ☐
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 that specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this 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 to the Registration Statement on Form S-1 (File No. 333-221036) is filed solely to amend Item 15 and Item 16 of Part II thereof and to file certain exhibits thereto. This Amendment No. 3 does not modify any provision of the preliminary prospectus contained in Part I. Accordingly, the preliminary prospectus has been omitted.
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 exchange listing fee.
Amount to be Paid | ||||
SEC registration fee |
$ | 31,500 | ||
FINRA filing fee |
38,450 | |||
NYSE listing fee |
295,000 | |||
Printing and engraving expenses |
400,000 | |||
Legal fees and expenses |
2,000,000 | |||
Accounting fees and expenses |
1,800,000 | |||
Transfer agent and registrar fees |
5,000 | |||
Miscellaneous expenses |
430,050 | |||
|
|
|||
Total |
$ | 5,000,000 | ||
|
|
Item 14. Indemnification of Directors and Officers.
The registrant is incorporated under the laws of the State of Delaware. Section 145 of the DGCL provides that a Delaware corporation may indemnify any persons who were, are or are threatened to be made parties 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 such corporation), by reason of the fact that such person is or was an officer, director, employee or agent of such corporation, or is or was serving at the request of such corporation as an officer, director, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided that such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporations best interests and, with respect to any criminal action or proceeding, had no reasonable cause to believe that his or her conduct was illegal. A Delaware corporation may indemnify any persons who were, are or are threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation by reason of the fact that such person is or was a director, officer, employee or agent of such corporation, or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit provided such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporations best interests except that no indemnification is permitted without judicial approval if the officer or director is adjudged to be liable to the corporation. Where an officer or director is successful on the merits or otherwise in the defense of any action referred to above, the corporation must indemnify him or her against the expenses (including attorneys fees) actually and reasonably incurred.
The registrants charter and bylaws, provide for the indemnification of its directors and officers to the fullest extent permitted under the DGCL.
Section 102(b)(7) of the DGCL permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duties as a director, except for liability for any:
| transaction from which the director derives an improper personal benefit; |
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| act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; |
| unlawful payment of dividends or redemption of shares; or |
| breach of a directors duty of loyalty to the corporation or its stockholders. |
The registrants charter includes such a provision. Expenses incurred by any officer or director in defending any such action, suit or proceeding in advance of its final disposition shall be paid by the registrant upon delivery to it of an undertaking, by or on behalf of such director or officer, to repay all amounts so advanced if it shall ultimately be determined that such director or officer is not entitled to be indemnified by the registrant.
Section 174 of the DGCL provides, among other things, that a director who willfully or negligently approves of an unlawful payment of dividends or an unlawful stock purchase or redemption may be held liable for such actions. A director who was either absent when the unlawful actions were approved or dissented at the time may avoid liability by causing his or her dissent to such actions to be entered in the books containing minutes of the meetings of the board of directors at the time such action occurred or immediately after such absent director receives notice of the unlawful acts.
The registrants policy is to enter into separate indemnification agreements with each of its directors and officers that provide the maximum indemnity allowed to directors and executive officers by Section 145 of the DGCL and also to provide for certain additional procedural protections. The registrant also maintains directors and officers insurance to insure such persons against certain liabilities.
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 registrants officers and directors for liabilities (including reimbursement of expenses incurred) arising under the Securities Act of 1933, as amended.
The 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 and otherwise.
Item 15. Recent Sales of Unregistered Securities.
Since the registrants formation in August 2014, it has made sales of the following unregistered securities:
Preferred Stock Issuances
From September 2014 through March 2015, the registrant sold an aggregate of 223,332 shares of its preferred stock to 14 investors and certain of its employees, directors, consultants and other service providers at a purchase price of $1,000.00 per share, for an aggregate purchase price of $223,332,260.
In September 2016, the registrant sold an aggregate of 1,263 shares of preferred stock to three employees at a purchase price of $1,000.00 per share, for an aggregate purchase price of $1,263,000.
Stock Option and Common Stock Issuances
From September 2014 through March 2015, the registrant sold an aggregate of 43,628,518 shares of common stock to 14 investors and certain of its employees, directors, consultants and other service providers at a purchase price of $0.0517 per share, for an aggregate purchase price of $2,255,456.
In September 2016, the registrant sold an aggregate of 36,079 shares of common stock to three employees at a purchase price of $1.84215 per share, for an aggregate purchase price of $66,462.
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Since August 2014, the registrant has granted to its employees, consultants and other service providers options to purchase an aggregate of 2,887,823 shares of common stock under its Amended and Restated 2015 Stock Option and Grant Plan and its 2015 Stock Incentive Plan at exercise prices ranging from $1.0686 to $3.73597 per share.
Since August 2014, the registrant has granted to its employees, directors, consultants and other service providers restricted stock awards for an aggregate of 7,897,287 shares of common stock pursuant to restricted stock agreements.
Since August 2014, the registrant has issued to its employees, consultants and other service providers an aggregate of 146,363 shares of common stock upon the exercise of options under its Amended and Restated 2015 Stock Option and Grant Plan and its 2015 Stock Incentive Plan at exercise prices ranging from $1.0686 to $2.45651 per share, for a weighted-average exercise price of $2.172918.
None of the foregoing transactions involved any underwriters, underwriting discounts or commissions, or any public offering. The registrant believes the offers, sales and issuances of the above securities were exempt from registration under the Securities Act by virtue of Section 4(a)(2) of the Securities Act (or Regulation D or Regulation S promulgated thereunder) because the issuance of securities to the recipients did not involve a public offering, or in reliance on Rule 701 because the transactions were pursuant to compensatory benefit plans or contracts relating to compensation as provided under such rule. 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, and appropriate legends were placed upon the stock certificates issued in these transactions. All recipients had adequate access, through their relationships with us, to information about us. The sales of these securities were made without any general solicitation or advertising.
Item 16. Exhibits and Financial Statement Schedules.
(a) Exhibits.
Exhibit Index
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** | 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.
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.
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Insofar as indemnification for liabilities arising under the Securities Act of 1933 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 Securities and Exchange Commission such indemnification is against public policy as expressed in the 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 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 of 1933, 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 of 1933, 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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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 Austin, Texas, on November 13, 2017.
SAILPOINT TECHNOLOGIES HOLDINGS, INC. | ||
By: |
/s/ Mark McClain |
|
Mark McClain Chief Executive Officer |
Pursuant to the requirements of the Securities Act of 1933, 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/ Mark McClain Mark McClain |
Chief Executive Officer and Director (Principal Executive Officer) |
November 13, 2017 | ||
/s/ Cam McMartin Cam McMartin |
Chief Financial Officer
(Principal Financial Officer) |
November 13, 2017 | ||
/s/ Thomas Beck Thomas Beck |
Vice President, Finance
(Principal Accounting Officer) |
November 13, 2017 | ||
* Marcel Bernard |
Director |
November 13, 2017 | ||
* William Gregory Bock |
Director |
November 13, 2017 | ||
* Seth Boro |
Director |
November 13, 2017 | ||
* James Michael Pflaging |
Director |
November 13, 2017 | ||
* Kenneth J. Virnig, II |
Director |
November 13, 2017 |
* By: |
/s/ Cam McMartin |
|
Cam McMartin Attorney-in-Fact |
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Exhibit 1.1
Shares
SAILPOINT TECHNOLOGIES HOLDINGS, INC.
COMMON STOCK ($0.0001 PAR VALUE PER SHARE)
UNDERWRITING AGREEMENT
, 2017
, 2017
Morgan Stanley & Co. LLC
Citigroup Global Markets Inc.
Jefferies LLC
RBC Capital Markets, LLC
c/o | Morgan Stanley & Co. LLC |
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
SailPoint Technologies Holdings, Inc., a Delaware corporation (the Company ), proposes to issue and sell to the several Underwriters named in Schedule I hereto (the Underwriters ), for whom Morgan Stanley & Co. LLC ( Morgan Stanley ), Citigroup Global Markets Inc. ( Citi ), Jefferies LLC and RBC Capital Markets, LLC are acting as representatives (the Representatives ), and certain stockholders of the Company named in Schedule I hereto (the Selling Stockholders ) propose to sell to the several Underwriters an aggregate of shares of the common stock, $0.0001 par value per share of the Company (the Firm Shares ), of which shares are to be issued and sold by the Company and shares are to be sold by the Selling Stockholders, each Selling Stockholder selling the amount set forth opposite such Selling Stockholders name in Schedule I hereto.
The Company and the Selling Stockholders marked with * on Schedule I hereto also propose to issue and sell to the several Underwriters, severally and not jointly, not more than an additional shares of its common stock, $0.0001 par value per share (the Additional Shares ), if and to the extent that the Representatives shall have determined to exercise, on behalf of the Underwriters, the right to purchase such shares of common stock granted to the Underwriters in Section 3 hereof. The Firm Shares and the Additional Shares are hereinafter collectively referred to as the Shares . The shares of common stock, $0.0001 par value per share, of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the Common Stock . The Company and the Selling Stockholders are hereinafter sometimes collectively referred to as the Sellers .
The Company has filed with the Securities and Exchange Commission (the Commission ) a registration statement, including a prospectus, relating to the Shares. The registration statement as amended at the time it becomes effective, including the information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as amended (the Securities Act ), is hereinafter referred to as the Registration Statement ; the prospectus in the form first used to confirm sales of Shares (or in the form first made
available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the Prospectus. If the Company has filed an abbreviated registration statement to register additional shares of Common Stock pursuant to Rule 462(b) under the Securities Act (the Rule 462 Registration Statement ), then any reference herein to the term Registration Statement shall be deemed to include such Rule 462 Registration Statement.
For purposes of this Underwriting Agreement (this Agreement ), free writing prospectus has the meaning set forth in Rule 405 under the Securities Act, Time of Sale Prospectus means the preliminary prospectus together with the documents, pricing information and the free writing prospectuses, if any, set forth in Schedule III hereto, and broadly available road show means a bona fide electronic road show as defined in Rule 433(h)(5) under the Securities Act that has been made available without restriction to any person. As used herein, the terms Registration Statement, preliminary prospectus, Time of Sale Prospectus and Prospectus shall include the documents, if any, incorporated by reference therein as of the date hereof.
1. Representations and Warranties of the Company . The Company represents and warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose are pending before or, to the Companys knowledge, threatened by the Commission.
(b) (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, will not contain, as of the date of such amendment or supplement, any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement and the Prospectus comply and, as amended or supplemented, if applicable, will, as of the date of such amendment or supplement, comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date (as defined in Section 5), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iv) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (v) the Prospectus does not contain, as of its date, and, as amended or supplemented, if applicable, will not contain, as of the date of such amendment or supplement, any untrue statement of a material fact or omit to state a material fact necessary to
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make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale Prospectus or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein.
(c) The Company is not an ineligible issuer in connection with the offering pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Each free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies or, if filed after the effective date of this Agreement, will comply, when filed, in all material respects with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Except for the free writing prospectuses, if any, identified in Schedule III hereto, and electronic road shows, if any, each furnished to you before first use, the Company has not prepared, used or referred to, and will not, without your prior consent, prepare, use or refer to, any free writing prospectus.
(d) The Company has been duly incorporated, is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own or lease its property and to conduct its business as described in the Time of Sale Prospectus and is duly qualified to transact business and is in good standing (to the extent the concept of good standing is applicable in such jurisdiction) in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(e) Each subsidiary of the Company has been duly incorporated, organized or formed, as applicable, is validly existing as a corporation or organization and in good standing under the laws of the jurisdiction of its incorporation, organization or formation (to the extent the concept of good standing is applicable in such jurisdiction), has the corporate or other organizational power and authority to own or lease its property and to conduct its business as described in the Time of Sale Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification (to the extent the concept of good standing is applicable in such jurisdiction), except to the extent that the failure to be so qualified or be in good standing would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; all of the issued and outstanding equity interests
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of each subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable (to the extent such concepts are applicable under relevant law) and are owned directly by the Company or a subsidiary of the Company, free and clear of all liens, encumbrances, equities or claims.
(f) This Agreement has been duly authorized, executed and delivered by the Company.
(g) The authorized capital stock of the Company conforms as to legal matters to the description thereof contained in each of the Time of Sale Prospectus and the Prospectus.
(h) The shares of Common Stock (including the Shares to be sold by the Selling Stockholders) outstanding prior to the issuance of the Shares to be sold by the Company have been duly authorized and are validly issued, fully paid and non-assessable.
(i) The Shares to be sold by the Company have been duly authorized and, when issued, delivered and paid for in accordance with the terms of this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of such Shares will not be subject to any preemptive or similar rights.
(j) The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement will not contravene any provision of (i) applicable law, (ii) the certificate of incorporation or bylaws of the Company, (iii) any agreement or other instrument binding upon the Company or any of its subsidiaries that is material to the Company and its subsidiaries, taken as a whole, or (iv) any judgment, order or decree of any governmental body, agency or court having jurisdiction over the Company or any subsidiary, except in the case of clauses (i) and (iii), as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; and no consent, approval, authorization or order of, or qualification with, any governmental body or agency is required for the performance by the Company of its obligations under this Agreement, except such as have been obtained or waived or as may be required by the securities or Blue Sky laws of the various states or foreign jurisdictions or the rules and regulations of the Financial Industry Regulatory Authority ( FINRA ) in connection with the offer and sale of the Shares.
(k) There has not occurred any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus.
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(l) There are no legal or governmental proceedings pending or, to the Companys knowledge, threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of its subsidiaries is subject (i) other than proceedings accurately described in all material respects in the Time of Sale Prospectus and proceedings that would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or on the power or ability of the Company to perform its obligations under this Agreement or to consummate the transactions contemplated by the Time of Sale Prospectus or (ii) that are required to be described in the Registration Statement or the Prospectus and are not so described in all material respects; and there are no statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not described in all material respects or filed as required.
(m) Each preliminary prospectus filed as part of the registration statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act, complied when so filed in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder.
(n) The Company is not, and after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Prospectus will not be, required to register as an investment company as such term is defined in the Investment Company Act of 1940, as amended.
(o) The Company and its subsidiaries (i) are in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants ( Environmental Laws ), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(p) There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) which would, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
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(q) Except as otherwise have been validly waived in connection with the issuance and sale of the Shares contemplated hereby and as described in the Time of Sale Prospectus and the Prospectus, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement.
(r) (i) Neither the Company nor any of its subsidiaries or affiliates, nor any director or officer thereof, or, to the Companys knowledge, any employee, agent or representative of the Company or of any of its subsidiaries or affiliates, has taken (or has any plans to take) any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment, giving or receipt of money, property, gifts or anything else of value, directly or indirectly, to any government official (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) ( Government Official ) in order to improperly influence official action, or to any person in violation of any applicable anti-corruption laws; (ii) the Company and its subsidiaries and affiliates have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintained and will continue to maintain policies and procedures reasonably designed to promote and achieve compliance with such laws and with the representations and warranties contained herein; and (iii) neither the Company nor its subsidiaries will use, directly or indirectly, the proceeds of the offering in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any person in violation of any applicable anti-corruption laws.
(s) The operations of the Company and its subsidiaries are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company and its subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the Anti-Money Laundering Laws ), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.
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(t) (i) Neither the Company, nor any of its subsidiaries, nor any director or officer thereof, nor, to the Companys knowledge, any employee, agent, affiliate or representative of the Company or any of its subsidiaries, is an individual or entity ( Person ) that is, or is owned or controlled by one or more Persons that are:
(A) the subject of any sanctions administered or enforced by the U.S. Department of Treasurys Office of Foreign Assets Control ( OFAC ) , the United Nations Security Council ( UNSC ), the European Union ( EU ), Her Majestys Treasury ( HMT ), or other relevant sanctions authority (collectively, Sanctions ), nor
(B) located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Crimea, Cuba, Iran, North Korea, Sudan and Syria).
(ii) Neither the Company nor any of its subsidiaries will, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person:
(A) to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or
(B) in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).
(iii) For the past 5 years, the Company and its subsidiaries have not knowingly engaged in, are not now knowingly engaged in, and will not engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.
(u) Subsequent to the respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) the Company and its subsidiaries have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction; (ii) the Company has not purchased any of its outstanding capital stock, other than from its employees or other service providers in connection with the termination of their service pursuant to equity compensation plans or agreements described in the Time of Sale Prospectus, nor declared, paid or otherwise made any dividend or distribution of any kind on its capital stock other than ordinary and customary dividends; and (iii) there has not been any material
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change in the capital stock (other than the exercise of equity awards or grants of equity awards or forfeiture of equity awards outstanding as of such respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, in each case granted pursuant to the equity compensation plans described in the Time of Sale Prospectus), short-term debt or long-term debt of the Company and its subsidiaries, except in each case as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, respectively.
(v) The Company and its subsidiaries do not own any real property. The Company and its subsidiaries, taken as a whole, have good and marketable title to all tangible personal property owned by them which is material to the business of the Company and its subsidiaries, taken as a whole, in each case free and clear of all liens, encumbrances and defects except such as are described in the Time of Sale Prospectus or such as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as would not reasonably be expected to materially interfere with the use made and proposed to be made of such property and buildings by the Company and its subsidiaries, in each case except as described in the Time of Sale Prospectus.
(w) The Company and its subsidiaries own or possess, or can acquire on commercially reasonable terms, all patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names, domain names and other intellectual property rights, and moral rights throughout the world (collectively Intellectual Property Rights ) employed by them in connection with, or which are necessary to, the business now conducted by them or as proposed to be conducted by them in the Time of Sale Prospectus ( Company Intellectual Property ), except where the failure to own, possess or acquire any of the foregoing would not reasonably be likely to result in a material adverse effect on the Company and its subsidiaries, taken as a whole. Neither the Company nor any of its subsidiaries has received any written claim of infringement or misappropriation of the Intellectual Property Rights of others by the Company or any of its subsidiaries that has not been resolved, except where the failure to resolve such claim would not reasonably be likely to result in a material adverse effect on the Company and its subsidiaries, taken as a whole. The Company and its subsidiaries have taken all reasonable steps necessary to secure exclusive ownership rights in the Company Intellectual Property from their employees, consultants, agents and contractors. No government funding, facilities or resources of a university, college, other educational institution or research center or funding from third parties was used in the development of any Company Intellectual Property that is owned or purported to be owned by the Company or any of its subsidiaries except as would not have a material adverse effect on the Company and its subsidiaries, taken as a whole.
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The Company and its subsidiaries have used all software and other materials distributed under a free, open source, or similar licensing model (including but not limited to the GNU General Public License, GNU Lesser General Public License and GNU Affero General Public License) ( Open Source Materials ) in compliance with all license terms applicable to such Open Source Materials. Neither the Company nor any of its subsidiaries has used or distributed any Open Source Materials in a manner that requires or has required (i) the Company or any of its subsidiaries to permit a third party to reverse-engineer any products or services owned by the Company or any of its subsidiaries, or any software code or other technology owned by the Company or any of its subsidiaries, except as otherwise required by applicable law; or (ii) any products or services owned by the Company or any of its subsidiaries, or any software code or other technology owned by the Company or any of its subsidiaries, to be (A) disclosed or distributed to third parties in source code form, (B) licensed for the purpose of a third party making derivative works, or (C) redistributable to third parties at no charge.
(x) No material labor dispute with the employees of the Company or any of its subsidiaries exists, except as described in the Time of Sale Prospectus, or, to the knowledge of the Company, is imminent; and the Company is not aware of any existing, threatened or imminent labor disturbance by the employees of any of its principal suppliers, service providers, manufacturers or contractors that would reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(y) The Company and each of its subsidiaries, taken as a whole, are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are, in the reasonable judgment of the Company, prudent and customary in the businesses in which they are engaged; neither the Company nor any of its subsidiaries has been refused any insurance coverage sought or applied for; and neither the Company nor any of its subsidiaries has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, except as described in the Time of Sale Prospectus.
(z) The Company and its subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses as described in the Time of Sale Prospectus, except where the failure to obtain such certificates, authorizations or permits would have a material adverse effect on the Company and its subsidiaries, taken as a whole, and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a material adverse effect on the Company and its subsidiaries, taken as a whole, except as described in the Time of Sale Prospectus.
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(aa) The Company and its subsidiaries, taken as a whole, maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with managements general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles in the United States (U.S. GAAP) and to maintain asset accountability; (iii) access to assets is permitted only in accordance with managements general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Except as described in the Time of Sale Prospectus, since the end of the Companys most recent audited fiscal year, there has been (i) no material weakness in the Companys internal control over financial reporting (whether or not remediated) and (ii) no change in the Companys internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Companys internal control over financial reporting.
(bb) Except as described in the Time of Sale Prospectus, the Company has not sold, issued or distributed any shares of Common Stock during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other than shares issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation plans or pursuant to outstanding options, rights or warrants.
(cc) The Company and each of its subsidiaries have filed all federal, state, local and foreign tax returns required to be filed by them through the date of this Agreement or have requested extensions thereof (except where the failure to file would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole) and have paid all taxes required to be paid thereon (except for cases in which the failure to pay would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or except as currently being contested in good faith and for which reserves required by U.S. GAAP have been created in the financial statements of the Company), and no unpaid tax deficiency has been determined adversely to the Company or any of its subsidiaries which has had (nor does the Company nor any of its subsidiaries have any notice or knowledge of any unpaid tax deficiency which would reasonably be expected to be determined adversely to the Company or its subsidiaries and which would reasonably be expected to have) a material adverse effect on the Company and its subsidiaries, taken as a whole.
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(dd) From the time of initial confidential submission of the Registration Statement to the Commission (or, if earlier, the first date on which the Company engaged directly or through any person authorized to act on its behalf in any Testing-the-Waters Communication) through the date hereof, the Company has been and is an emerging growth company, as defined in Section 2(a) of the Securities Act (an Emerging Growth Company ). Testing-the-Waters Communication means any oral or written communication with potential investors undertaken in reliance on Section 5(d) of the Securities Act.
(ee) The Company (i) has not alone engaged in any Testing-the-Waters Communication other than Testing-the-Waters Communications with the consent of the Representatives with entities that are qualified institutional buyers within the meaning of Rule 144A under the Securities Act or institutions that are accredited investors within the meaning of Rule 501 under the Securities Act and (ii) has not authorized anyone other than the Representatives to engage in Testing-the-Waters Communications. The Company reconfirms that the Representatives have been authorized to act on its behalf in undertaking Testing-the-Waters Communications. The Company has not distributed any Written Testing-the-Waters Communications other than those listed on Schedule [ ] hereto. Written Testing-the-Waters Communication means any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act.
(ff) The Company is not (i) in violation of its certificate of incorporation or bylaws; (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company is subject; or (iii) in violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority having jurisdiction over the Company or any of its properties, except, in the case of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(gg) Except, in each case, as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, individually or in the aggregate: (i) no prohibited transaction (as defined in Section 406 of the Employee Retirement Income Security Act of 1974, as amended, including the regulations and published interpretations thereunder ( ERISA ), or Section 4975 of the Internal Revenue Code of 1986, as amended from time to time (the Code )), or failure to satisfy the minimum funding standard or minimum required contribution (as such terms are defined in Section 412 or 430 of the Code or Section 302 of ERISA) or any of the events set forth in Section 4043(b) of ERISA (other than events with respect to which the 30-day notice requirement under Section 4043 of ERISA has been waived or a safe harbor is available) has occurred with respect to any employee benefit plan with respect to which the
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Company or any of its subsidiaries could, have any liability; (ii) each such employee benefit plan has been maintained in compliance with its terms and the requirements of applicable law, including ERISA and the Code; and (iii) the Company and its subsidiaries have not incurred and do not expect to incur liability under Title IV of ERISA with respect to the termination of, or withdrawal from, any pension plan.
(hh) As of the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers, none of (i) the Time of Sale Prospectus, (ii) any free writing prospectus, when considered together with the Time of Sale Prospectus, and (iii) any individual Written Testing-the-Waters Communication, when considered together with the Time of Sale Prospectus, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(ii) The Company and each of its subsidiaries comply with its privacy and data and information security policies and third-party obligations (imposed by applicable law, contract or otherwise) regarding the collection, use, transfer, storage, protection, disposal and disclosure by the Company and its subsidiaries of personally identifiable information and/or any other information collected from or provided by third parties (collectively, Data ), except to the extent that the failure to do so would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole. To the Companys knowledge, the information technology systems, equipment and software used by the Company or any of its subsidiaries in their respective businesses (the IT Assets ) (i) operate and perform as required by the Companys and its subsidiaries respective businesses as currently conducted as described in the Time of Sale Prospectus, and (ii) are subject to industry standard scans for viruses, back doors, Trojan horses, time bombs, worms, drop dead devices or other software or hardware components that are designed to permit unauthorized access to, or damage or erase, any software material to the business of the Company or any of its subsidiaries. The Company and its subsidiaries have implemented commercially reasonable backup and disaster recovery technology processes consistent with industry standard practices. To the Companys knowledge, there has been no material security breach or attack or other compromise of any such information technology system or data (including personally identifiable information) owned or controlled by the Company or any of its subsidiaries.
(jj) The financial statements of the Company included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus present fairly in all material respects the consolidated financial position of the Company and its subsidiaries as of the dates indicated and the results of their operations and cash flows for the periods specified. Such financial statements have been prepared in conformity with U.S. GAAP applied on a consistent basis throughout the
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periods involved, except as described therein. The other financial information of the Company included in the Registration Statement, the Time of Sale Prospectus and the Prospectus has been derived from the accounting records of the Company and its subsidiaries and presents fairly in all material respects the information shown thereby.
(kk) Grant Thornton LLP, who have certified certain financial statements of the Company, are independent public accountants as required by the Securities Act, and the rules and regulations of the Commission thereunder, and the Public Company Accounting Oversight Board (United States).
(ll) Nothing has come to the attention of the Company that has caused the Company to believe that the statistical and market-related data included in the Registration Statement, the Time of Sale Prospectus and the Prospectus is not based on or derived from sources that are reliable and accurate in all material respects.
(mm) Except as described in the Time of Sale Prospectus and the Prospectus, no person has the right to require the Company or any of its subsidiaries to register any securities for sale under the Securities Act by reason of the filing of the Registration Statement with the Commission, the issuance and sale of the Shares by the Company.
2. Representations and Warranties of the Selling Stockholders. Each Selling Stockholder, individually with respect to itself only and not jointly and severally, represents and warrants to and agrees with each of the Underwriters that:
(a) This Agreement has been duly authorized, executed and delivered by or on behalf of such Selling Stockholder and the transactions contemplated by this Agreement have been duly authorized by such Selling Stockholder.
(b) The execution and delivery by such Selling Stockholder of, and the performance by such Selling Stockholder of its obligations under, this Agreement, will not contravene any provision of applicable law, or the certificate of limited partnership or limited partnership agreement of such Selling Stockholder (if such Selling Stockholder is a limited partnership), or any agreement or other instrument binding upon such Selling Stockholder or any judgment, order or decree of any governmental body, agency or court having jurisdiction over such Selling Stockholder, and no consent, approval, authorization or order of, or qualification with, any governmental body or agency is required for the performance by such Selling Stockholder of its obligations under this Agreement, except such as may be required by the state securities, antifraud or Blue Sky laws of the various states in connection with the offer and sale of the Shares (collectively, the States Securities Laws ) and except, in each case, for any contravention that would not, individually or in the aggregate, have a material adverse effect on the ability of such Selling Stockholder to consummate the transactions contemplated herein.
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(c) Such Selling Stockholder has, and on the Closing Date will have, valid title to, or a valid security entitlement within the meaning of Section 8-501 of the New York Uniform Commercial Code in respect of, the Shares to be sold by such Selling Stockholder free and clear of all security interests, claims, liens, equities or other encumbrances.
(d) Upon payment for the Shares to be sold by such Selling Stockholder pursuant to this Agreement, delivery of such Shares, as directed by the Underwriters, to Cede & Co. ( Cede ) or such other nominee as may be designated by the Depository Trust Company ( DTC ), registration of such Shares in the name of Cede or such other nominee and the crediting of such Shares on the books of DTC to securities accounts of the Underwriters (assuming that neither DTC nor any such Underwriter has notice of any adverse claim (within the meaning of Section 8-105 of the New York Uniform Commercial Code (the UCC )) to such Shares), (A) DTC shall be a protected purchaser of such Shares within the meaning of Section 8-303 of the UCC, (B) under Section 8-501 of the UCC, the Underwriters will acquire a valid security entitlement in respect of such Shares and (C) no action based on any adverse claim, within the meaning of Section 8-102 of the UCC, to such Shares may be asserted against the Underwriters with respect to such security entitlement; for purposes of this representation, such Selling Stockholder may assume that when such payment, delivery and crediting occur, (x) such Shares will have been registered in the name of Cede or another nominee designated by DTC, in each case on the Companys share registry in accordance with its certificate of incorporation, bylaws and applicable law, (y) DTC will be registered as a clearing corporation within the meaning of Section 8-102 of the UCC and (z) appropriate entries to the accounts of the several Underwriters on the records of DTC will have been made pursuant to the UCC.
(e) As of the date hereof, such Selling Stockholder is not prompted by any material non-public information concerning the Company or its subsidiaries which is not set forth in the Time of Sale Prospectus to sell its Shares pursuant to this Agreement, provided, however, except with respect to the Selling Stockholder Information (as defined below), that no representation or warranty is being made hereby as to whether the Registration Statement, the Time of Sale Prospectus or the Prospectus contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances in which they are made, not misleading.
(f) (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Time of Sale Prospectus does not, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the
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light of the circumstances under which they were made, not misleading, and (iii) the Prospectus does not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, provided that such representations and warranties set forth in this Section 2(d) apply only to statements or omissions made in reliance upon and in conformity with information relating to such Selling Stockholder furnished in writing by or on behalf of the Selling Stockholder expressly for use in each of the Registration Statement, the Prospectus and the Time of Sale Prospectus, it being understood and agreed that for purposes of this Agreement, the only information so furnished by such Selling Stockholder before the offering (excluding percentages and the number of shares of common stock that will be beneficially owned by such Selling Stockholder after the offering) consists of (i) the legal name, address and number of shares of common stock, as applicable, owned by such Selling Stockholder which appear in the table (and corresponding footnotes) under the caption Principal and Selling Stockholders in the Prospectus (such information with respect to each Selling Stockholder, the Selling Stockholder Information ); and (ii) in the case of the Selling Stockholders affiliated with Thoma Bravo, LLC, the information relating to Thoma Bravo, LLC in the Our Equity Sponsor section under the caption Summary as set forth in the Time of Sale Prospectus and Prospectus.
(g) (i) None of such Selling Stockholder or any of its subsidiaries, or, to the knowledge of such Selling Stockholder, any director, officer, employee, agent, representative, or affiliate thereof, is a Person that is, or is owned or controlled by one or more Persons that are:
(A) the subject of any Sanctions, or
(B) located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Crimea, Cuba, Iran, North Korea, Sudan and Syria).
(ii) Such Selling Stockholder will not, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person:
(A) to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or
(B) in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).
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(iii) (a) None of such Selling Stockholder or its subsidiaries, or, to the knowledge of such Selling Stockholder, any director, officer, employee, agent, representative, or affiliate thereof has taken or will take any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment giving or receipt of money, property, gifts or anything else of value, directly or indirectly, to any Government Official in order to influence official action, or to any person in violation of any applicable anti-corruption laws and (b) neither the Selling Stockholder nor any of its subsidiaries will use, directly or indirectly, the proceeds of the offering in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any person in violation of any applicable anti-corruption laws.
(iv) The operations of such Selling Stockholder and its subsidiaries are an have been conducted at all times in material compliance with all applicable Anti Money Laundering Laws, and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involved such Selling Stockholder or any of its subsidiaries with respect to the Anti Money Laundering Laws is pending or, to the best knowledge of the Selling Stockholder, threatened.
(h) Such Selling Stockholder represents and warrants that it is not (i) an employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974, as amended (ERISA), (ii) a plan or account subject to Section 4975 of the Internal Revenue Code of 1986, as amended or (iii) an entity deemed to hold plan assets of any such plan or account under Section 3(42) of ERISA, 29 C.F.R. 2510.3-101, or otherwise.
3. Agreements to Sell and Purchase. Each Seller, severally and not jointly, hereby agrees to sell to the several Underwriters, and each Underwriter, upon the basis of the representations and warranties herein contained, but subject to the conditions hereinafter stated, agrees, severally and not jointly, to purchase from such Seller at $ a share (the Purchase Price ) the number of Firm Shares (subject to adjustments to eliminate fractional shares as you may determine) that bears the same proportion to the number of Firm Shares to be sold by such Seller as the number of Firm Shares set forth in Schedule II hereto opposite the name of such Underwriter bears to the total number of Firm Shares.
On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company and the Selling Stockholders marked with * on Schedule I hereto agree to sell to the Underwriters the Additional Shares, and the Underwriters shall have the right to purchase, severally and not jointly, up to Additional Shares at the Purchase Price, provided, however, that the amount paid by the Underwriters for any Additional Shares shall be reduced by an amount per share equal to any dividends declared by the Company and payable on the Firm Shares but not payable on such Additional Shares. You may exercise this right on
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behalf of the Underwriters in whole or from time to time in part by giving written notice to both the Company and the Selling Stockholders marked with * on Schedule I hereto not later than 30 days after the date of this Agreement. Any exercise notice shall specify the number of Additional Shares to be purchased by the Underwriters and the date on which such shares are to be purchased. Each purchase date must be at least one business day after the written notice is given and may not be earlier than the closing date for the Firm Shares nor later than ten business days after the date of such notice. Additional Shares may be purchased as provided in Section 5 hereof solely for the purpose of covering over-allotments made in connection with the offering of the Firm Shares. On each day, if any, that Additional Shares are to be purchased (an Option Closing Date ), each Underwriter agrees, severally and not jointly, to purchase the number of Additional Shares (subject to such adjustments to eliminate fractional shares as you may determine) that bears the same proportion to the total number of Additional Shares to be purchased on such Option Closing Date as the number of Firm Shares set forth in Schedule II hereto opposite the name of such Underwriter bears to the total number of Firm Shares. The number of Additional Share to be purchased shall be allocated as follows: fifty percent (50%) of the Additional Shares shall be purchased from the Company and fifty percent (50%) of the Additional Shares shall be purchased from the Selling Stockholders marked with * on Schedule I hereto (pro rata in accordance with the number of Firm Shares sold by such Selling Stockholders).
4. Terms of Public Offering . The Sellers are advised by you that the Underwriters propose to make a public offering of their respective portions of the Shares as soon after the Registration Statement and this Agreement have become effective as in your judgment is advisable. The Sellers are further advised by you that the Shares are to be offered to the public initially at $ a share (the Public Offering Price ) and to certain dealers selected by you at a price that represents a concession not in excess of $ a share under the Public Offering Price, and that any Underwriter may allow, and such dealers may reallow, a concession, not in excess of $ a share, to any Underwriter or to certain other dealers.
5. Payment and Delivery. Payment for the Firm Shares to be sold by each Seller shall be made to such Seller in Federal or other funds immediately available in New York City against delivery of such Firm Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on , 2017, or at such other time on the same or such other date, not later than , 2017, as shall be designated in writing by you. The time and date of such payment are hereinafter referred to as the Closing Date .
Payment for any Additional Shares shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Additional Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on the date specified in the corresponding notice described in Section 3 or at such other time on the same or on such other date, in any event not later than , 2017, as shall be designated in writing by you.
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The Firm Shares and Additional Shares shall be registered in such names and in such denominations as you shall request in writing not later than one full business day prior to the Closing Date or the applicable Option Closing Date, as the case may be. The Firm Shares and Additional Shares shall be delivered to you on the Closing Date or an Option Closing Date, as the case may be, for the respective accounts of the several Underwriters, with any transfer taxes payable in connection with the transfer of the Shares to the Underwriters duly paid, against payment of the Purchase Price therefor.
6. Conditions to the Underwriters Obligations . The obligations of the Sellers to sell the Shares to the Underwriters and the several obligations of the Underwriters to purchase and pay for the Shares on the Closing Date are subject to the condition that the Registration Statement shall have become effective not later than [ ] (New York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any of the securities of the Company or any of its subsidiaries by any nationally recognized statistical rating organization, as such term is defined in Section 3(a)(62) of the Securities Exchange Act of 1934, as amended (the Exchange Act ); and
(ii) there shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus that, in your judgment, is material and adverse and that makes it, in your judgment, impracticable to market the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus.
(b) The Underwriters shall have received on the Closing Date a certificate, dated the Closing Date and signed on behalf of the Company by an executive officer of the Company, to the effect set forth in Section 6(a)(i) above and to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date and (ii) a certificate, dated the Closing Date and signed by [an officer] [a trustee] of each of the Selling Stockholders, to the effect that the representations and warranties of such Selling Stockholder contained in this Agreement are true and correct as of
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the Closing Date and that such Selling Stockholder has complied in all material respects with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely upon the best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an opinion of Vinson & Elkins L.L.P., outside counsel for the Company, dated the Closing Date, in form and substance reasonably satisfactory to the Representatives.
(d) The Underwriters shall have received on the Closing Date an opinion of Goodwin Procter LLP, counsel for the Underwriters, dated the Closing Date, in form and substance reasonably satisfactory to the Representatives.
(e) The Underwriters shall have received on the Closing Date (and Option Closing Date, if applicable) an opinion of Kirkland & Ellis LLP, counsel for the Selling Stockholders, dated the Closing Date (or Option Closing Date, if applicable), in form and substance reasonably satisfactory to the Representatives.
(f) The Underwriters shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Underwriters, from Grant Thornton LLP, independent public accountants, containing statements and information of the type ordinarily included in accountants comfort letters to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement, the Time of Sale Prospectus and the Prospectus; provided that the letter delivered on the Closing Date shall use a cut-off date not earlier than the date hereof.
(g) The lock-up agreements, each substantially in the form of Exhibit A hereto, between you and certain stockholders, officers and directors of the Company relating to sales and certain other dispositions of shares of Common Stock or certain other securities, delivered to you on or before the date hereof, shall be in full force and effect on the Closing Date.
(h) The Underwriters shall have received, on the date hereof and the Closing Date, a certificate of the principal financial officer of the Company dated the date hereof or the Closing Date, as the case may be, in form and substance reasonably satisfactory to the Underwriters, containing statements and information with respect to certain financial information contained in the Time of Sale Prospectus and the Prospectus.
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(i) The several obligations of the Underwriters to purchase Additional Shares hereunder are subject to the delivery to you on the applicable Option Closing Date of the following:
(i) a certificate, dated the Option Closing Date and signed on behalf of the Company by an executive officer of the Company, confirming that the certificate delivered on the Closing Date pursuant to Section 6(b) hereof remains true and correct as of such Option Closing Date;
(ii) an opinion of Vinson & Elkins L.L.P., outside counsel for the Company, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(c) hereof;
(iii) an opinion of Goodwin Procter LLP, counsel for the Underwriters, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(d) hereof;
(iv) an opinion of Kirkland & Ellis LLP, counsel for the Selling Stockholders, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(e) hereof;
(v) a letter dated the Option Closing Date, in form and substance satisfactory to the Underwriters, from Grant Thornton LLP independent public accountants, substantially in the same form and substance as the letter furnished to the Underwriters pursuant to Section 6(e) hereof; provided that the letter delivered on the Option Closing Date shall use a cut-off date not earlier than three business days prior to such Option Closing Date; and
(vi) such other documents as you may reasonably request with respect to the good standing of the Company, the due authorization and issuance of the Additional Shares to be sold by the Company on such Option Closing Date and other matters related to the issuance of such Additional Shares.
7. Covenants of the Company . The Company covenants with each Underwriter as follows:
(a) To furnish to you, without charge, four signed copies of the Registration Statement (including exhibits thereto) and for delivery to each other Underwriter a conformed copy of the Registration Statement (without exhibits thereto) and to furnish to you in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding the date of this Agreement and during the period mentioned in Section 7(e) or 7(f) below, as many copies of the Time of Sale Prospectus, the Prospectus and any supplements and amendments thereto or to the Registration Statement as you may reasonably request.
20
(b) Before amending or supplementing the Registration Statement, the Time of Sale Prospectus or the Prospectus, to furnish to you a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which you reasonably object, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.
(c) To furnish to you a copy of each proposed free writing prospectus to be prepared by or on behalf of, used by, or referred to by the Company and not to use or refer to any proposed free writing prospectus to which you reasonably object.
(d) Not to take any action that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not have been required to file thereunder.
(e) If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in the light of the circumstances, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement then on file, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when the Time of Sale Prospectus is delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.
(f) If, during such period after the first date of the public offering of the Shares as in the opinion of counsel for the Underwriters the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is required by law to be delivered in connection with sales by an Underwriter or dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in
21
Rule 173(a) of the Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses you will furnish to the Company) to which Shares may have been sold by you on behalf of the Underwriters and to any other dealers upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law.
(g) To endeavor to qualify the Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions as you shall reasonably request; provided, however, that the Company shall not be required to qualify to do business or as a dealer in securities in any jurisdiction where it would not otherwise be required to so qualify, to execute a general consent to service of process in any jurisdiction or to subject itself to taxation in any jurisdiction in which it is not otherwise subject.
(h) To make generally available to the Companys security holders and to you as soon as practicable an earnings statement covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.
(i) The Company will promptly notify the Representatives if the Company ceases to be an Emerging Growth Company at any time prior to the later of (a) completion of the distribution of the Shares within the meaning of the Securities Act and (b) completion of the Restricted Period (as defined in this Section 7).
(j) If at any time during the period in which delivery of a prospectus is required by the Securities Act and following the distribution of any Written Testing-the-Waters Communication, there occurred or occurs an event or development as a result of which such Written Testing-the-Waters Communication, as then amended or supplemented, included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Representatives and will promptly amend or supplement, at its own expense, such Written Testing-the-Waters Communication to eliminate or correct such untrue statement or omission.
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The Company also covenants with each Underwriter that, without the prior written consent of Morgan Stanley and Citi, on behalf of the Underwriters, it will not, during the period ending 180 days after the date of the Prospectus (the Restricted Period ), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise, (3) file any registration statement with the Commission relating to the offering of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or (4) make any public announcement of its intention to do any of the foregoing.
The restrictions contained in the preceding paragraph shall not apply to (a) the Shares to be sold hereunder, (b) the issuance by the Company of shares of Common Stock upon the exercise (including any net exercise) of an option or warrant or the conversion of a security, in each case outstanding on the date hereof and identified in the Time of Sale Prospectus, (c) the grant or issuance by the Company, or exercise or settlement (in cash, shares of Common Stock or otherwise), of options, restricted stock awards, restricted stock units or any other type of equity award to employees, officers, directors, advisors or consultants of the Company pursuant to employee benefit plans described in the Time of Sale Prospectus, (d) the filing by the Company of a registration statement with the Commission on Form S-8 with respect to employee benefit plans in described in the Time of Sale Prospectus, (e) the establishment or amendment of a trading plan pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock, provided that (i) such plan does not provide for the transfer of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of, or voluntarily made by, the Company regarding the establishment or amendment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Stock may be made under such plan during the Restricted Period, or (f) the sale or issuance of or entry into an agreement to sell or issue Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock in connection with the Companys acquisition of one or more businesses, assets, products or technologies (whether by means of merger, stock or equity purchase, asset purchase or otherwise) or in connection with joint ventures, commercial relationships or other strategic corporate transactions or alliances; provided that the aggregate number of shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock (on an as-converted, as-exercised or as-exchanged basis) that the Company may sell or issue or agree to sell or issue pursuant to this paragraph shall not exceed 10% of the total number of shares of Common Stock issued and outstanding immediately following the completion of the transactions contemplated by this Agreement, and provided further that the Company shall cause each such recipient to execute and deliver to the Representatives, on or prior to the such issuance, a lock-up agreement substantially in the form of Exhibit A hereto with respect to the remaining portion of the Restricted Period.
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If Morgan Stanley and Citi, in their sole discretion, agree to release or waive the restrictions set forth in a lock-up letter described in Section 6(f) hereof for an officer or director of the Company and provide the Company with notice of the impending release or waiver at least three business days before the effective date of the release or waiver, the Company agrees to announce the impending release or waiver by a press release substantially in the form of Exhibit B hereto through a major news service at least two business days before the effective date of the release or waiver.
8. Covenants of the Sellers . Each Seller, severally and not jointly, covenants with each Underwriter as follows:
(a) Each Seller will deliver to each Underwriter (or its agent), prior to or at the Closing Date, a properly completed and executed Internal Revenue Service ( IRS ) Form W-9 or an IRS Form W-8, as appropriate, together with all required attachments to such form.
9. Expenses. Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, the Company agrees to pay or cause to be paid all expenses incident to the performance of the Sellers obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Companys counsel, the Companys accountants and counsel for the Selling Stockholders in connection with the registration and delivery of the Shares under the Securities Act and all other fees or expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or other taxes payable thereon, (iii) the cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Shares under state securities laws and all expenses in connection with the qualification of the Shares for offer and sale under state securities laws as provided in Section 1(g) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (iv) all filing fees and the reasonable fees and disbursements of counsel to the Underwriters incurred in connection with the review and qualification of the offering of the Shares by FINRA, (v) all fees and expenses in connection with the preparation and filing of the registration statement on Form 8-A relating to the Common Stock and all costs and expenses incident to listing the Shares on the New York Stock Exchange, (vi) the cost of printing certificates representing the Shares, (vii) the costs and charges of any transfer agent, registrar or depositary, (viii) the costs and expenses of the Company relating to investor presentations on any road show undertaken in connection with the marketing of the offering of the Shares, including,
24
without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives and officers of the Company and any such consultants, and 50% of the cost of any aircraft chartered in connection with the road show (with the remaining 50% of the costs of such aircraft, as well as any other travel and lodging expenses of the Underwriters in connection with the road show, to be paid by the Underwriters), and (ix) the document production charges and expenses associated with printing this Agreement. It is understood, however, that except as provided in this Section, Section 11 entitled Indemnity and Contribution and the last paragraph of Section 13 below, the Underwriters will pay all of their costs and expenses, including fees and disbursements of their counsel, stock transfer taxes payable on resale of any of the Shares by them and any advertising expenses connected with any offers they may make.
The provisions of this Section shall not supersede or otherwise affect any agreement that the Sellers may otherwise have for the allocation of such expenses among themselves.
10. Covenants of the Underwriters . Each Underwriter severally covenants with the Company not to take any action that would result in the Company being required to file with the Commission under Rule 433(d) a free writing prospectus prepared by or on behalf of such Underwriter that otherwise would not be required to be filed by the Company thereunder, but for the action of the Underwriter.
11. Indemnity and Contribution.
(a) Each Seller agrees, severally and not jointly (in proportion to the number of Shares to be sold by such Seller hereunder), to indemnify and hold harmless each Underwriter, its directors and officers and each person, if any, who controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act and each affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any road show as defined in Rule 433(h) under the Securities Act (a road show), or the Prospectus or any amendment or supplement thereto, or any Written Testing-the-Waters Communication or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except (i) insofar as such losses, claims, damages or liabilities are caused by any such untrue statement or
25
omission or alleged untrue statement or omission based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein and (ii) with respect to the Selling Stockholders only with respect to such losses, claims, damages or liabilities that are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information furnished by the Selling Stockholder in writing to the Company relating to the Selling Stockholder expressly for use in the Registration Statement, the Prospectus (or any amendment or supplement thereto) or any Issuer Free Writing Prospectus, it being understood and agreed that for purposes of this Agreement, the only information so furnished by each Selling Stockholder consists of such Selling Stockholders Selling Stockholder Information. The liability of each Selling Stockholder under the indemnity agreement contained in this paragraph shall be limited to an amount equal to the aggregate gross proceeds after underwriting commissions and discounts, but before deducting expenses received by such Selling Stockholder under this Agreement.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, the Selling Stockholders, the directors of the Company, the officers of the Company who sign the Registration Statement and each person, if any, who controls the Company or any Selling Stockholder within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the foregoing indemnity from the Sellers to such Underwriter, but only with reference to information relating to such Underwriter furnished to the Company in writing by such Underwriter through you expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus, road show or the Prospectus or any amendment or supplement thereto.
(c) In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 11(a) or 11(b) , such person (the indemnified party ) shall promptly notify the person against whom such indemnity may be sought (the indemnifying party ) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the reasonably incurred fees and disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in
26
connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all such indemnified parties and that all such fees and expenses shall be reimbursed as they are incurred. Such firm shall be designated in writing by the Representatives, in the case of parties indemnified pursuant to Section 11(a) , and by the Company, in the case of parties indemnified pursuant to Section 11(b). In the case of any such separate firm for the Selling Stockholders and such control persons of any Selling Stockholders, such firm shall be designated in writing by the Selling Stockholders. The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section 11(a) or 11(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party or parties on the other hand from the offering of the Shares or (ii) if the allocation provided by clause 8(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 8(d)(i) above but also the relative fault of the Company on the one hand and of the Underwriters on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Sellers on the one hand and the Underwriters on the other hand in connection with the offering of the Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the
27
Shares (before deducting expenses) received by each Seller and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate Public Offering Price of the Shares. The relative fault of the Sellers on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Sellers or by the Underwriters and the parties relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Underwriters respective obligations to contribute pursuant to this Section 11 are several in proportion to the respective number of Shares they have purchased hereunder, and not joint. The liability of each Selling Stockholder under the contribution agreement contained in this paragraph shall be limited to an amount equal to the aggregate gross proceeds after underwriting commissions and discounts, but before deducting expenses received by such Selling Stockholder under this Agreement.
(e) The Sellers and the Underwriters agree that it would not be just or equitable if contribution pursuant to this Section 11 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 11(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 11(d) shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 11, (i) no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission or (ii) no Selling Stockholder shall be required to contribute (x) other than to the extent the losses, claims, damages, liabilities or expenses arose from information furnished by such Selling Stockholder in writing to the Company relating to such Selling Stockholder expressly for use in the Registration Statement or the Prospectus (or any amendment or supplement thereto), it being understood and agreed that for purposes of this Agreement, the only information so furnished by such Selling Stockholder consists of such Selling Stockholders Selling Stockholder Information, or (y) any amount in excess of the amount by which the gross proceeds after underwriting commissions and discounts, but before deducting expenses, received by such Selling Stockholder from the offering of the Shares hereunder exceeds the amount of any damages that such Selling Stockholder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent
28
misrepresentation. The remedies provided for in this Section 11 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity. The Selling Stockholders obligations to contribute pursuant to paragraphs (d) and (e) are several in proportion to the number of Shares to be sold by such Selling Stockholder and not joint.
(f) The indemnity and contribution provisions contained in this Section 11 and the representations, warranties and other statements of the Company and the Selling Stockholders contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter, its directors and officers, any person controlling any Underwriter or any affiliate of any Underwriter, any Selling Stockholder or any person controlling any Selling Stockholder, or by or on behalf of the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Shares.
12. Termination . The Underwriters may terminate this Agreement by notice given by you to the Company, if after the execution and delivery of this Agreement and prior to the Closing Date (i) trading generally shall have been suspended or materially limited on, or by, as the case may be, any of the New York Stock Exchange or the NASDAQ Global Market, (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a material disruption in securities settlement, payment or clearance services in the United States shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by Federal or New York State authorities or (v) there shall have occurred any outbreak or escalation of hostilities, or any change in financial markets or any calamity or crisis that, in your judgment, is material and adverse and which, singly or together with any other event specified in this clause (v), makes it, in your judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus or the Prospectus.
13. Effectiveness; Defaulting Underwriters . This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase Shares that it has or they have agreed to purchase hereunder on such date, and the aggregate number of Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Shares to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the number of Firm Shares set forth opposite their respective names in Schedule I bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as you may specify, to purchase the Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the number of Shares that any Underwriter has agreed to purchase pursuant to this Agreement be increased
29
pursuant to this Section 14 by an amount in excess of one-ninth of such number of Shares without the written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be purchased on such date, and arrangements satisfactory to you and the Company and the Selling Stockholders for the purchase of such Firm Shares are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter, the Company or the Selling Stockholders. In any such case either you or the relevant Sellers shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement, in the Time of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected. If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such Option Closing Date, the non-defaulting Underwriters shall have the option to (i) terminate their obligation hereunder to purchase the Additional Shares to be sold on such Option Closing Date or (ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to purchase in the absence of such default. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of any Seller to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason any Seller shall be unable to perform its obligations under this Agreement other than by reason of a default by the Underwriters, the Company will reimburse the non-defaulting Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves, for all out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by such non-defaulting Underwriters in connection with this Agreement or the offering contemplated hereunder.
14. Entire Agreement . (a) This Agreement, together with any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this Agreement) that relate to the offering of the Shares, represents the entire agreement between the Company and the Selling Stockholders, on the one hand, and the Underwriters, on the other, with respect to the preparation of any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Shares.
(b) The Company acknowledges that in connection with the offering of the Shares: (i) the Underwriters have acted at arms length, are not agents of, and owe no fiduciary duties to, the Company or any other person, (ii) the Underwriters owe the Company only those duties and obligations set forth in this Agreement and prior written agreements (to the extent not superseded by this Agreement), if any, and (iii) the Underwriters may have interests that differ from
30
those of the Company. The Company waives to the full extent permitted by applicable law any claims it may have against the Underwriters arising from an alleged breach of fiduciary duty in connection with the offering of the Shares.
15. Counterparts . This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.
16. Applicable Law . This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York.
17. Headings . The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.
18. Notices . All communications hereunder shall be in writing and effective only upon receipt and if to the Underwriters shall be delivered, mailed or sent to you, in care of Morgan Stanley & Co. LLC, at 1585 Broadway, New York, New York 10036, Attention: Equity Syndicate Desk, with a copy to the Legal Department; Citigroup Global Markets Inc., 388 Greenwich Street, New York, New York 10013 Attention: General Counsel, facsimile number 1-646-291-1469; if to the Company shall be delivered, mailed or sent to 11305 Four Points Dr., Bldg. 2, Suite 100, Austin, TX 78726; and if to the Selling Stockholders marked with * on Schedule I hereto shall be delivered, mailed or sent to Thoma Bravo, LLC, at 600 Montgomery Street, 20 th Floor, San Francisco, California 94111, Attention: Seth Boro and Chip Virnig, facsimile number 1-415-392-6480; and if to the other Selling Stockholders, shall be delivered, mailed or sent to [Address].
Very truly yours,
SAILPOINT TECHNOLOGIES HOLDINGS, INC. |
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By: |
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Name: | ||
Title: | ||
By: |
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Kevin Cunningham | ||
By: |
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Mark McClain |
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By: |
|
|
McClain Charitable Remainder Unitrust | ||
By: |
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Thoma Bravo Fund XI, L.P. | ||
By: |
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Thoma Bravo Fund X-A, L.P. | ||
By: |
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Thoma Bravo Executive Fund XI, L.P. |
32
By: |
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Name: | ||
Title: | ||
By: |
Jefferies LLC |
By: |
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Name: | ||
Title: | ||
By: | RBC Capital Markets, LLC |
By: |
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Name: | ||
Title: |
SCHEDULE I
Selling Stockholders |
Number of Firm Shares To
|
|||
Kevin Cunningham |
||||
Mark McClain |
||||
McClain Charitable Remainder Unitrust |
||||
Thoma Bravo Fund XI, L.P.* |
||||
Thoma Bravo Fund X-A, L.P.* |
||||
Thoma Bravo Executive Fund XI, L.P.* |
||||
|
|
|||
Total: |
||||
|
|
I-1
SCHEDULE II
Underwriter |
Number of Firm Shares To
|
|||
Morgan Stanley & Co. LLC |
||||
Citigroup Global Markets Inc. |
||||
Jeffries LLC |
||||
RBC Capital Markets, LLC |
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Keybanc Capital Markets Inc. |
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Canaccord Genuity Inc. |
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Oppenheimer & Co. Inc. |
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|
|
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Total: |
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II-1
SCHEDULE III
Time of Sale Prospectus
1. | Preliminary Prospectus issued [date] |
2. | [identify all free writing prospectuses filed by the Company under Rule 433(d) of the Securities Act] |
3. | [free writing prospectus containing a description of terms that does not reflect final terms, if the Time of Sale Prospectus does not include a final term sheet] |
III-1
EXHIBIT A
FORM OF LOCK-UP LETTER
[Provided under separate cover]
A-1
EXHIBIT B
FORM OF WAIVER OF LOCK-UP
, 2017
[Name and Address of
Officer or Director
Requesting Waiver]
Dear Mr./Ms. [Name]:
This letter is being delivered to you in connection with the offering by SailPoint Technologies Holdings, Inc. (the Company ) and [insert selling stockholders] (the Selling Stockholders ) of shares of common stock, $0.0001 par value (the Common Stock ), of the Company and the lock-up letter dated , 2017 (the Lock-up Letter ), executed by you in connection with such offering, and your request for a [waiver] [release] dated , 20 , with respect to shares of Common Stock (the Shares ).
Morgan Stanley & Co. LLC and Citigroup Global Markets Inc. hereby agree to [waive] [release] the transfer restrictions set forth in the Lock-up Letter, but only with respect to the Shares, effective , 20 ; provided, however, that such [waiver] [release] is conditioned on the Company announcing the impending [waiver] [release] by press release through a major news service at least two business days before effectiveness of such [waiver] [release]. This letter will serve as notice to the Company of the impending [waiver] [release].
Except as expressly [waived] [released] hereby, the Lock-up Letter shall remain in full force and effect.
Very truly yours,
Morgan Stanley & Co. LLC Acting severally on behalf of themselves and the several Underwriters named in Schedule I hereto |
By: |
|
|
Name: | ||
Title: |
1
Citigroup Global Markets Inc. Acting severally on behalf of themselves and the several Underwriters named in Schedule I hereto |
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By: | ||
Name: | ||
Title: |
cc: | Company |
2
FORM OF PRESS RELEASE
SailPoint Technologies Holdings, Inc.
[Date]
SailPoint Technologies Holdings, Inc. (the Company ) announced today that Morgan Stanley & Co. LLC and Citigroup Global Markets Inc., the lead book-running managers in the Companys recent public sale of shares of common stock are [waiving][releasing] a lock-up restriction with respect to shares of the Companys common stock held by [certain officers or directors] [an officer or director] of the Company. The [waiver][release] will take effect on , 20 and the shares may be sold on or after such date.
This press release is not an offer for sale of the securities in the United States or in any other jurisdiction where such offer is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended.
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Exhibit 3.2
FORM OF
CERTIFICATE OF AMENDMENT
TO
SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
SAILPOINT TECHNOLOGIES HOLDINGS, INC.
* * * * *
Adopted in accordance with the provisions of §228 and §242 of the General Corporation Law of the State of Delaware
* * * * *
The undersigned, being the Chief Financial Officer and Treasurer of SailPoint Technologies Holdings, Inc., a corporation duly organized and existing under and by virtue of the General Corporation Law of the State of Delaware (the Corporation ), does hereby certify as follows:
FIRST : A Second Amended and Restated Certificate of Incorporation of the Corporation was filed with the Delaware Secretary of State on June 27, 2017 (the Existing Certificate )
SECOND : That the Existing Certificate be, and hereby is, amended by deleting Article IV, Section 1 in its entirety and substituting in lieu thereof a new Article IV, Section 1 to read as follows:
ARTICLE IV
Section 1. Authorized Capital Stock . The total number of shares of all classes of stock which the Corporation shall have authority to issue is 300,500,000 consisting of: (a) 300,000,000 shares of Common Stock, $0.0001 par value per share (hereinafter called Common Stock ), and (b) 500,000 shares of Series A Preferred Stock, $0.0001 par value per share (hereinafter called Preferred Stock ).
THIRD: That the Existing Certificate be, and hereby is, amended by adding a new sentence after the first sentence of Article IV, Section 3.3(a) to read as follows:
For greater clarity, the conversion contemplated by this Section 3.3(a) shall be deemed effective one minute after the effectiveness of the filing of the Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation first inserting this sentence, which Certificate of Amendment is being filed immediately prior to the closing of a Qualified IPO.
FOURTH: That the Existing Certificate be, and hereby is, amended by deleting the first sentence of Article IV, Section 3.3(c) in its entirety and substituting in lieu thereof a new sentence to read as follows:
Following any conversion pursuant to this Section 3.3 , the holder of Preferred Stock shall receive a certificate or certificates (or book-entry) representing shares of Common Stock upon the surrender of any certificate or certificates evidencing such shares so converted (the Converting Shares ), duly assigned to the Corporation or endorsed in blank, at the principal office of the Corporation (or such other office or agency of the Corporation as the Corporation may designate by written notice to the holders of Preferred Stock) at any time during its usual business hours.
FIFTH: That the members of the board of directors of the Corporation approved the foregoing amendment by written consent pursuant to the provisions of Section 141(f) and 242 of the General Corporation Law of the State of Delaware and directed that such amendment be submitted to the stockholders of the Corporation entitled to vote thereon for their consideration, approval and adoption thereof.
SIXTH: That the stockholders entitled to vote thereon approved the foregoing amendment by written consent in accordance with Section 228 and 242 of the General Corporation Law of the State of Delaware.
SEVENTH: The amendments set forth herein have been duly adopted in accordance with Sections 242 and 228 of the General Corporation Law of the State of Delaware.
* * * * *
IN WITNESS WHEREOF, the undersigned does hereby certify under penalties of perjury that this Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation of the Corporation is the act and deed of the Corporation and the facts stated herein are true and accordingly has hereunto set his hand this day of November, 2017.
SAILPOINT TECHNOLOGIES HOLDINGS, INC., a Delaware corporation |
||
By: |
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|
Name: | Cam McMartin | |
Title: | Chief Financial Officer |
Certificate of Amendment SailPoint Technologies Holdings, Inc.
Exhibit 3.4
FORM OF
THIRD AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
SAILPOINT TECHNOLOGIES HOLDINGS, INC.
ARTICLE ONE
The name of the Corporation is SailPoint Technologies Holdings, Inc. (the Corporation ).
ARTICLE TWO
The address of the Corporations registered office in the State of Delaware is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County of New Castle, 19801. The name of its registered agent at such address is The Corporation Trust Company. The registered office and/or registered agent of the Corporation may be changed from time to time by resolution of the Board of Directors of the Corporation (the Board of Directors ). Upon the adoption of such a resolution, a certificate certifying such change shall be executed, acknowledged and filed with the Office of the Secretary of State of the State of Delaware in accordance with the Delaware General Corporation Law (the DGCL ).
ARTICLE THREE
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the DGCL and to possess and employ all powers and privileges now or hereafter granted or available under the laws of the State of Delaware to such corporations.
ARTICLE FOUR
PART A. AUTHORIZED SHARES
The total number of shares of all classes of capital stock which the Corporation shall have authority to issue is 310,000,000 shares, consisting of:
1. 10,000,000 shares of a class of Preferred Stock, par value $0.0001 per share (the Preferred Stock ); and
2. 300,000,000 shares of a class of Common Stock, par value $0.0001 per share (the Common Stock ).
The Preferred Stock and the Common Stock shall have the rights, preferences and limitations set forth below.
PART B. PREFERRED STOCK
The Board of Directors is authorized, subject to limitations prescribed by law, to provide, by resolution or resolutions for the issuance of shares of Preferred Stock in one or more series, and with respect to each series, to establish the number of shares to be included in each such series, and to fix the voting powers (if any), designations, powers, preferences, and relative, participating, optional or other special rights, if any, of the shares of each such series, and any qualifications, limitations or restrictions thereof. The powers, preferences, and relative, participating, optional and other special rights of each series of Preferred Stock and the qualifications, limitations or restrictions thereof, if any, may differ from those of any and all other series at any time outstanding. Subject to applicable law and within the limitations or restrictions stated in any resolution or resolutions of the Board of Directors fixing the number of shares constituting a series of Preferred Stock, the Board of Directors may increase or decrease (but not below the number of shares of any such series of Preferred Stock then outstanding) by resolution the number of shares of any such series of Preferred Stock. In the event that the number of shares of any series of Preferred Stock shall be so decreased, the shares constituting such decrease shall resume the undesignated status which such shares had prior to the adoption of the resolution originally fixing the number of shares of such series of Preferred Stock subject to the requirements of applicable law. The number of authorized shares of Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority in voting power of the outstanding shares of capital stock of the Corporation entitled to vote, without the separate vote of the holders of the Preferred Stock as a class, irrespective of the provisions of Section 242(b)(2) of the DGCL, unless a vote of any such holders is required pursuant to the terms of any Preferred Stock designation.
PART C. COMMON STOCK
(a) Except as otherwise required by the DGCL or this Certificate of Incorporation and subject to the rights of holders of any series of Preferred Stock, all of the voting power of the stockholders of the Corporation shall be vested in the holders of the Common Stock. Each share of Common Stock shall entitle the holder thereof to one vote for each share held by such holder on all matters voted upon by the stockholders of the Corporation; provided , however , that, except as otherwise required by law, holders of Common Stock, as such, shall not be entitled to vote on any amendment to this Certificate of Incorporation (including any certificate of designations relating to any series of Preferred Stock) that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to this Certificate of Incorporation (including any certificate of designations relating to any series of Preferred Stock).
(b) Subject to the rights of the holders of Preferred Stock and to the other provisions of this Certificate of Incorporation, holders of Common Stock shall be entitled to receive equally, on a per share basis, such dividends in cash, securities or other property of the Corporation as may be declared thereon by the Board of Directors from time to time out of assets or funds of the Corporation legally available therefor.
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(c) In the event of any liquidation, dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary, after payment or provision for payment of the Corporations debts and any other payments required by law and amounts payable upon shares of Preferred Stock ranking senior to the shares of Common Stock upon such dissolution, liquidation or winding up, if any, the remaining net assets of the Corporation shall be distributed to the holders of shares of Common Stock and the holders of shares of any other class or series ranking equally with the shares of Common Stock upon such dissolution, liquidation or winding up, equally on a per share basis.
ARTICLE FIVE
The Corporation is to have perpetual existence.
ARTICLE SIX
Section 1. Board of Directors . The provisions of this Article (including the provisions relating to the election, designation and appointment of directors and the terms of directors) have been adopted pursuant to the final clause of the first sentence, and the second sentence, of Section 141(a) of the DGCL. Except as otherwise provided in this Certificate of Incorporation, the business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. Except as otherwise provided in this Certificate of Incorporation, the provisions of the DGCL that otherwise apply to directors or a board of directors shall apply to the directors of the Corporation and the Board of Directors. In addition to the powers and authority expressly conferred upon them by statute or by this Certificate of Incorporation or the Bylaws of the Corporation (as amended from time to time, the Bylaws ), the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation.
Section 2. Number of Directors . Subject to any rights of the holders of any series of Preferred Stock to elect additional directors under specified circumstances, the number of directors which shall constitute the Board of Directors shall be fixed exclusively from time to time by (i) for so long as Thoma Bravo Fund XI, L.P. ( TB Fund XI ), Thoma Bravo Fund X-A, L.P. and Thoma Bravo Executive Fund XI, L.P. (collectively, the Thoma Bravo Funds ), including through their Affiliates, beneficially own (directly or indirectly) in the aggregate at least 30% of the outstanding Common Stock of the Corporation, TB Fund XI or (ii) thereafter, resolution adopted by the affirmative vote of a majority of the directors then in office.
Section 3. Classes of Directors . Beginning immediately following the consummation of the Corporations initial public offering of its Common Stock pursuant to an effective registration statement under the Securities Act of 1933, as amended (the Initial Public Offering ), the directors of the Corporation, other than those who may be elected by the holders of any series of Preferred Stock under specified circumstances, shall be divided into three classes, hereby designated Class I, Class II and Class III.
Section 4. Term of Office . The term of office of the initial Class I directors shall expire at the first annual meeting of stockholders after the Initial Public Offering, the term of office of the initial Class II directors shall expire at the second succeeding annual meeting of
3
stockholders after the Initial Public Offering and the term of office of the initial Class III directors shall expire at the third succeeding annual meeting of the stockholders after the Initial Public Offering. For the purposes hereof, the Board of Directors may assign directors already in office to the initial Class I, Class II and Class III at the time that the division of directors into classes becomes effective. At each annual meeting of stockholders after the Initial Public Offering, directors elected to replace those of a Class whose terms expire at such annual meeting shall be elected for a term expiring at the third succeeding annual meeting after their election and shall remain in office until their respective successors shall have been duly elected and qualified. Nothing in this Certificate of Incorporation shall preclude a director from serving consecutive terms. Elections of directors need not be by written ballot.
Section 5. TB Fund XI Nominated Directors . Notwithstanding anything to the contrary in this Certificate of Incorporation, for so long as the Thoma Bravo Funds, including through their Affiliates, beneficially own (directly or indirectly) in the aggregate at least (a) 30% of the outstanding Common Stock of the Corporation: (i) TB Fund XI shall have the right to nominate a majority of the directors to the Board of Directors; provided that, at such time as the Corporation ceases to be a controlled company, the majority of the Board of Directors will be comprised of independent directors, as such terms are defined under the rules of the exchange on which the Corporations securities are listed; (ii) TB Fund XI shall have the right to designate the Chairman of the Board of Directors; and (iii) TB Fund XI shall have the right to designate the chairman of each committee designated by the Board of Directors; provided that, the committee membership of each committee designated by the Board of Directors will comply with the applicable rules of the exchange on which the Corporations securities are listed; (b) 20% (but less than 30%) of the outstanding Common Stock of the Corporation, TB Fund XI shall have the right to nominate a number of directors to the Board of Directors equal to the lowest whole number that is greater than 30% of the total number of directors (but in no event fewer than two directors); (c) 10% (but less than 20%) of the outstanding Common Stock of the Corporation, TB Fund XI shall have the right to nominate a number of directors to the Board of Directors equal to the lowest whole number that is greater than 20% of the total number of directors (but in no event fewer than one director); and (d) 5% (but less than 10%) of the outstanding Common Stock of the Corporation, TB Fund XI shall have the right to nominate one director to the Board of Directors. Subject to the rights of the holders of any series of Preferred Stock then outstanding, all directors that are not elected in accordance with the preceding sentences of this Section 5 shall be elected by the holders of Common Stock (together with the holders of any series of Preferred Stock entitled to vote thereon with the Common Stock as a single class).
Section 6. Newly-Created Directorships and Vacancies . Subject to the rights of the holders of any series of Preferred Stock then outstanding, (i) newly created directorships resulting from any increase in the authorized number of directors and (ii) any vacancies in the Board of Directors resulting from death, resignation, disqualification, removal from office or any other cause may be filled only by (A) for so long as the Thoma Bravo Funds, including through their Affiliates, beneficially own (directly or indirectly) in the aggregate at least 30% of the outstanding Common Stock of the Corporation, TB Fund XI or (B) thereafter, the Board of Directors (and not by stockholders), provided that a quorum is then in office and present, or by a majority of the directors then in office, if less than a quorum is then in office, or by the sole remaining director. A director elected to fill a vacancy shall be elected for the unexpired term of his or her predecessor in office and until his or her successor is elected and qualified, or until his
4
or her earlier death, resignation or removal. After the Initial Public Offering, a director chosen to fill a position resulting from an increase in the number of directors shall hold office until the next election of the class for which such director shall have been chosen and until his or her successor is elected and qualified, or until his or her earlier death, resignation or removal. No decrease in the authorized number of directors shall shorten the term of any incumbent director.
Section 7. Removal of Directors . Subject to the rights of the holders of any series of Preferred Stock then outstanding and notwithstanding any other provision of this Certificate of Incorporation, (i) prior to the first date on which the Thoma Bravo Funds and their Affiliates cease to beneficially own (directly or indirectly) in the aggregate at least 30% of the voting power of the then outstanding shares of capital stock of the Corporation then entitled to vote generally in the election of directors ( Voting Stock ), directors may be removed with or without cause upon the affirmative vote of the Thoma Bravo Funds and their Affiliates which beneficially own outstanding shares of Voting Stock and (ii) on and after such date, directors may only be removed for cause (as defined below) and only upon the affirmative vote of stockholders representing at least a majority of the voting power of the then outstanding shares of Voting Stock, at a meeting of the Corporations stockholders called for that purpose. Unless the Board has made a determination that removal is in the best interests of the Corporation (in which case the following definition shall not apply), cause for removal of a director shall be deemed to exist only if (a) the director whose removal is proposed has been convicted of a felony by a court of competent jurisdiction and such conviction is no longer subject to direct appeal; (b) such director has been found by the affirmative vote of a majority of the directors then in office at any regular or special meeting of the Board called for that purpose, or by a court of competent jurisdiction, to have been guilty of willful misconduct in the performance of such directors duties to the Corporation in a matter of substantial importance to the Corporation; or (c) such director has been adjudicated by a court of competent jurisdiction to be mentally incompetent, which mental incompetency directly affects such directors ability to perform his or her obligations as a director of the Corporation. Any director may resign at any time upon written notice to the Corporation.
Section 8. Advance Notice . Advance notice of stockholder nominations for the election of directors and of business to be brought by stockholders before any meeting of the stockholders of the Corporation shall be given in the manner provided in the Bylaws of the Corporation.
ARTICLE SEVEN
To the fullest extent permitted by the DGCL as it now exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader rights than permitted prior thereto), no director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages arising from a breach of fiduciary duty owed to the Corporation or its stockholders. Any repeal or modification of the foregoing sentence shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification with respect to any act, omission or other matter occurring prior to the time of such repeal or modification.
5
ARTICLE EIGHT
Section 1. Action by Written Consent . From and after the first date (the Trigger Date ) on which the Thoma Bravo Funds, including through their Affiliates, cease to beneficially own (directly or indirectly) in the aggregate at least a majority of the voting power of the then outstanding shares of Voting Stock, any action required or permitted to be taken by the Corporations stockholders may be effected only at a duly called annual or special meeting of the Corporations stockholders and the power of stockholders to consent in writing without a meeting is specifically denied. Prior to the Trigger Date, any action which is required or permitted to be taken by the Corporations stockholders may be taken without a meeting, without prior notice and without a vote if a consent or consents in writing, setting forth the action so taken, is signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares of the Corporations stock entitled to vote thereon were present and voted.
Section 2. Special Meetings of Stockholders . Subject to the rights of the holders of any series of Preferred Stock then outstanding and to the requirements of applicable law, special meetings of stockholders of the Corporation may be called only (i) by or at the direction of the Board of Directors pursuant to a written resolution adopted by the affirmative vote of the majority of the total number of directors that the Corporation would have if there were no vacancies or (ii) prior to the Trigger Date, by the Secretary of the Corporation at the request of the holders of a majority of the voting power of the then outstanding shares of Voting Stock in the manner provided for in the Bylaws. Any business transacted at any special meeting of stockholders shall be limited to matters relating to the purpose or purposes stated in the notice of the meeting.
ARTICLE NINE
Section 1. Certain Acknowledgments . In recognition and anticipation that: (i) the principals, officers, members, managers, partners, directors, employees and/or independent contractors of the Thoma Bravo Group (as defined below) may serve as directors or officers of the Corporation, (ii) members of the Thoma Bravo Group engage and may continue to engage in the same or similar activities or related lines of business as those in which the Corporation, directly or indirectly, may engage and/or other business activities that overlay with or compete with those in which the Corporation, directly or indirectly, may engage, and (iii) that the Corporation and its Affiliate Companies (as defined below) may engage in material business transactions with the Thoma Bravo Group, and that the Corporation is expected to benefit therefrom, the provisions of this ARTICLE NINE are set forth to regulate and define the conduct of certain affairs of the Corporation as they may involve the Thoma Bravo Group and/or its respective principals, officers, members, managers, partners, directors, employees and/or independent contractors, including any of the foregoing who serve as officers or directors of the Corporation (collectively, the Exempted Persons ), and the powers, rights, duties and liabilities of the Corporation and its officers, directors, stockholders and employees in connection therewith.
Section 2. Competition and Corporate Opportunities . To the fullest extent permitted by applicable law, neither the Thoma Bravo Group nor any of its respective Exempted Persons shall have any fiduciary duty to refrain from engaging, directly or indirectly, in the same or similar business activities or lines of business as the Corporation or any of its Affiliated
6
Companies, and no Exempted Person shall be liable to the Corporation or its stockholders for breach of any fiduciary or other duty (whether contractual or otherwise) solely by reason of any such activities of the Thoma Bravo Group or such Exempted Person. To the fullest extent permitted by applicable law, the Corporation, on behalf of itself and its Affiliated Companies, renounces any interest or expectancy of the Corporation and its Affiliated Companies in, or in being offered an opportunity to participate in, business opportunities that are from time to time presented to the Thoma Bravo Group or any of its Exempted Persons, even if the opportunity is one that the Corporation or its Affiliated Companies might reasonably be deemed to have pursued or had the ability or desire to pursue if granted the opportunity to do so, and each Exempted Person shall have no duty to communicate or offer such business opportunity to the Corporation or its Affiliated Companies and, to the fullest extent permitted by applicable law, shall not be liable to the Corporation or any of its Affiliated Companies for breach of any fiduciary or other duty (whether contractual or otherwise), as a director, officer or stockholder of the Corporation solely, by reason of the fact that the Thoma Bravo Group or any Exempted Person pursues or acquires such business opportunity, sells, assigns, transfers or directs such business opportunity, or information regarding such business opportunity, to the Corporation or any of its Affiliated Companies. For the avoidance of doubt, each member of the Thoma Bravo Group and its Exempted Persons shall have the right to, and shall have no duty (whether contractual or otherwise) not to, directly or indirectly: (A) engage in the same, similar or competing business activities or lines of business as the Corporation or its Affiliated Companies, (B) do business with any client or customer of the Corporation or its Affiliated Companies, or (C) make investments in competing businesses of the Corporation or its Affiliated Companies, and such acts shall not be deemed wrongful or improper.
Section 3. Certain Matters Deemed not Corporate Opportunities . In addition to and notwithstanding the foregoing provisions of this ARTICLE NINE, the Corporation renounces any interest or expectancy of the Corporation of any of its Affiliated Companies in, or in being offered an opportunity to participate in, any business opportunity that the Corporation is not financially able or contractually permitted or legally able to undertake. Moreover, nothing in this ARTICLE NINE shall amend or modify in any respect any written contractual agreement between the Thoma Bravo Group on one hand and the Corporation or any of its Affiliated Companies on the other hand.
Section 4. Certain Definitions. For purposes of this ARTICLE NINE, (i) Thoma Bravo Group means Thoma Bravo, LLC, its Affiliates and any of their respective managed investment funds (including the Thomas Bravo Funds) and portfolio companies (other than the Corporation and its Affiliated Companies) and their respective partners, members, directors, employees, independent contractors, principals, stockholders, agents, any successor by operation of law (including by merger) of any such person, and any entity that acquires all or substantially all of the assets of any such person in a single transaction or series of related transactions; (ii) Affiliated Company means any company controlled by the Corporation.
Section 5. Amendment of this Article . Notwithstanding anything to the contrary elsewhere contained in this Amended and Restated Certificate of Incorporation and in addition to any vote required by law: (i) the affirmative vote of the holders of at least 80% of the voting power of all shares of Common Stock then outstanding, voting together as a single class, shall be required to alter, amend or repeal, or to adopt any provision inconsistent with, this ARTICLE
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NINE; provided however , that neither the alteration, amendment or repeal of this ARTICLE NINE nor the adoption of any provision of this Amended and Restated Certificate of Incorporation inconsistent with this ARTICLE NINE shall apply to or have any effect on the liability or alleged liability of any Exempted Person for or with respect to any activities or opportunities which such Exempted Person becomes aware prior to such alteration, amendment, repeal or adoption.
Section 6. Deemed Notice . Any person or entity purchasing or otherwise acquiring or obtaining any interest in any capital stock of the Corporation shall be deemed to have notice and to have consented to the provisions of this ARTICLE NINE.
Section 7. Severability . To the extent that any provision or part of any provision of this ARTICLE NINE is found to be invalid or unenforceable, such invalidity or unenforceability shall not affect the validity or enforceability of any other provision or part of any other provision of this ARTICLE NINE, and this ARTICLE NINE shall be construed in all respects as if such invalid or enforceable provisions or parts were omitted.
ARTICLE TEN
Section 1. Section 203 of the DGCL . The Corporation expressly elects not to be governed by Section 203 of the DGCL.
Section 2. Interested Stockholder Transactions . Notwithstanding any other provision in this Certificate of Incorporation to the contrary, the Corporation shall not engage in any Business Combination (as defined hereinafter) with any Interested Stockholder (as defined hereinafter) for a period of three years following the time that such stockholder became an Interested Stockholder, unless:
(a) | prior to such time the Board of Directors approved either the Business Combination or the transaction which resulted in such stockholder becoming an Interested Stockholder; |
(b) | upon consummation of the transaction which resulted in such stockholder becoming an Interested Stockholder, such stockholder owned at least 85% of the Voting Stock (as defined hereafter) of the Corporation outstanding at the time the transaction commenced, excluding for purposes of determining the Voting Stock outstanding (but not the outstanding Voting Stock owned by such Interested Stockholder) those shares owned (i) by Persons (as defined hereinafter) who are directors and also officers of the Corporation and (ii) employee stock plans of the Corporation in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or |
(c) | at or subsequent to such time the Business Combination is approved by the Board of Directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding Voting Stock which is not owned by such Interested Stockholder. |
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Section 3. Exceptions to Prohibition on Interested Stockholder Transactions . The restrictions contained in this ARTICLE TEN shall not apply if:
(a) | a stockholder becomes an Interested Stockholder inadvertently and (i) as soon as practicable divests itself of ownership of sufficient shares so that the stockholder ceases to be an Interested Stockholder; and (ii) would not, at any time within the three-year period immediately prior to a Business Combination between the Corporation and such stockholder, have been an Interested Stockholder but for the inadvertent acquisition of ownership; or |
(b) | the Business Combination is proposed prior to the consummation or abandonment of and subsequent to the earlier of the public announcement or the notice required hereunder of a proposed transaction which (i) constitutes one of the transactions described in the second sentence of this Section 3(b) of this ARTICLE TEN; (ii) is with or by a Person who either was not an Interested Stockholder during the previous three years or who became an Interested Stockholder with the approval of the Board of Directors; and (iii) is approved or not opposed by a majority of the directors then in office (but not less than one) who were directors prior to any Person becoming an Interested Stockholder during the previous three years or were recommended for election or elected to succeed such directors by a majority of such directors. The proposed transactions referred to in the preceding sentence are limited to (x) a merger or consolidation of the Corporation (except for a merger in respect of which, pursuant to Section 251(f) of the DGCL, no vote of the stockholders of the Corporation is required); (y) a sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), whether as part of a dissolution or otherwise, of assets of the Corporation or of any direct or indirect majority-owned subsidiary of the Corporation (other than to any direct or indirect wholly-owned subsidiary or to the Corporation) having an aggregate market value equal to 50% or more of either that aggregate market value of all of the assets of the Corporation determined on a consolidated basis or the aggregate market value of all the outstanding Stock (as defined hereinafter) of the Corporation; or (z) a proposed tender or exchange offer for 50% or more of the outstanding Voting Stock of the Corporation. The Corporation shall give not less than 20 days notice to all Interested Stockholders prior to the consummation of any of the transactions described in clause (x) or (y) of the second sentence of this Section 3(b) of this ARTICLE TEN. |
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Section 4. Definitions . As used in this ARTICLE TEN only, and unless otherwise provided by the express terms of this ARTICLE TEN, the following terms shall have the meanings ascribed to them as set forth in this Section 4 of this ARTICLE TEN:
(a) | Affiliate means a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, another Person; |
(b) | Associate , when used to indicate a relationship with any Person, means: (i) any corporation, partnership, unincorporated association or other entity of which such Person is a director, officer or partner or is, directly or indirectly, the owner of 20% or more of any class of Voting Stock; (ii) any trust or other estate in which such Person has at least a 20% beneficial interest or as to which such Person serves as trustee or in a similar fiduciary capacity; and (iii) any relative or spouse of such Person, or any relative of such spouse, who has the same residence as such Person; |
(c) | Business Combination means: |
(i) | any merger or consolidation of the Corporation (other than pursuant to Section 251(g), Section 253 or Section 267 of the DGCL) or any direct or indirect majority-owned subsidiary of the Corporation with (A) the Interested Stockholder, or (B) with any Person if the merger or consolidation is caused by the Interested Stockholder and as a result of such merger or consolidation Section 2 of this ARTICLE TEN is not applicable to the surviving entity; |
(ii) | any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), except proportionately as a stockholder of the Corporation, to or with the Interested Stockholder, whether as part of a dissolution or otherwise, of assets of the Corporation or of any direct or indirect majority-owned subsidiary of the Corporation which assets have an aggregate market value equal to 10% or more of either the aggregate market value of all the assets of the Corporation determined on a consolidated basis or the aggregate market value of all the outstanding Stock of the Corporation; |
(iii) |
any transaction or series of transactions which results in the issuance or transfer by the Corporation or by any direct or indirect majority-owned subsidiary of the Corporation of 10% or more of any class or series of Stock of the Corporation or of such subsidiary to the Interested Stockholder, except: (A) pursuant to the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible into Stock of the Corporation or any such subsidiary which securities were outstanding prior to the time that the Interested Stockholder became such; (B) pursuant to a merger under Section 251(g) or Section 253 or Section 267 of the DGCL; (C) pursuant to a dividend or distribution paid or made, or the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible into Stock of the Corporation or any such subsidiary which security is distributed, pro rata to all holders of a class or series of Stock of the Corporation subsequent to the time the Interested |
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Stockholder became such; or (D) pursuant to an exchange offer by the Corporation to purchase Stock made on the same terms to all holders of such Stock. |
(d) | Control , including the terms controlling , controlled by and under common control with , means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of stock or other equity interests, by contract or otherwise. A Person who is the owner of 20% or more of the outstanding Voting Stock of any corporation, partnership, unincorporated association or other entity shall be presumed to have control of such entity, in the absence of proof by a preponderance of the evidence to the contrary; notwithstanding the foregoing, a presumption of control shall not apply where such Person holds Voting Stock, in good faith and not for the purpose of circumventing this ARTICLE TEN, as an agent, bank, broker, nominee, custodian or trustee for one or more owners who do not individually or as a group have control of such entity; |
(e) | Interested Stockholder means any Person (other than the Corporation and any direct or indirect majority-owned subsidiary of the Corporation) that (i) is the owner of 15% or more of the outstanding Voting Stock of the Corporation, or (ii) is an Affiliate or Associate of the Corporation and was the owner of 15% or more of the outstanding Voting Stock of the Corporation at any time within the three-year period immediately prior to the date on which it is sought to be determined whether such Person is an Interested Stockholder, and the Affiliates and Associates of such Person. Notwithstanding anything in this ARTICLE TEN to the contrary, the term Interested Stockholder shall not include: (x) the Thoma Bravo Funds or any of their Affiliates or Associates, including any investment funds managed by Thoma Bravo, LLC, or any other Person with whom any of the foregoing are acting as a group or in concert for the purpose of acquiring, holding, voting or disposing of shares of Stock of the Corporation; (y) any Person who would otherwise be an Interested Stockholder because of a transfer, sale, assignment, conveyance, hypothecation, encumbrance, or other disposition of 5% or more of the outstanding Voting Stock of the Corporation (in one transaction or a series of transactions) by any party specified in the immediately preceding clause (x) to such Person; provided , however , that such Person was not an Interested Stockholder prior to such transfer, sale, assignment, conveyance, hypothecation, encumbrance, or other disposition; or (z) any Person whose ownership of shares in excess of the 15% limitation set forth herein is the result of action taken solely by the Corporation, provided that, for purposes of this clause (z), such Person shall be an Interested Stockholder if thereafter such Person acquires additional shares of Voting Stock of the Corporation, except as a result of further action by the Corporation not caused, directly or indirectly, by such Person; |
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(f) | Owner , including the terms own and owned , when used with respect to any Stock, means a Person that individually or with or through any of its affiliates or associates beneficially owns such Stock, directly or indirectly; or has (A) the right to acquire such Stock (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding, or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise; provided , however , that a Person shall not be deemed the owner of Stock tendered pursuant to a tender or exchange offer made by such Person or any of such Persons Affiliates or Associates until such tendered Stock is accepted for purchase or exchange; or (B) the right to vote such Stock pursuant to any agreement, arrangement or understanding; provided , however , that a Person shall not be deemed the owner of any Stock because of such Persons right to vote such Stock if the agreement, arrangement or understanding to vote such Stock arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made to 10 or more Persons; or has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent as described in (B) of this Section 4(f) of ARTICLE TEN), or disposing of such Stock with any other Person that beneficially owns, or whose affiliates or associates beneficially own, directly or indirectly, such Stock; provided , that, for the purpose of determining whether a Person is an Interested Stockholder, the Voting Stock of the Corporation deemed to be outstanding shall include Stock deemed to be owned by the Person through application of this definition of owned but shall not include any other unissued Stock of the Corporation which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise; |
(g) | Person means any individual, corporation, partnership, unincorporated association or other entity; |
(h) | Stock means, with respect to any corporation, capital stock and, with respect to any other entity, any equity interest; and |
(i) | Voting Stock means, with respect to any corporation, Stock of any class or series entitled to vote generally in the election of directors and, with respect to any entity that is not a corporation, any equity interest entitled to vote generally in the election of the governing body of such entity. Every reference to a percentage of Voting Stock shall refer to such percentage of the votes of such Voting Stock. |
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ARTICLE ELEVEN
Section 1. Amendments to the Bylaws . In furtherance and not in limitation of the powers conferred by law, prior to the Trigger Date, the Corporations Bylaws may be amended, altered or repealed and new bylaws made by, in addition to any other vote otherwise required by law, the affirmative vote of the holders of at least a majority of the voting power of all of the then outstanding shares of Voting Stock, voting together as a single class. On and after the Trigger Date, the Corporations Bylaws may be amended, altered or repealed and new bylaws made by (i) the Board of Directors or (ii) in addition to any other vote otherwise required by law, the affirmative vote of the holders of at least 66 2/3% of the voting power of the then outstanding Voting Stock, voting together as a single class.
Section 2. Amendments to this Certificate of Incorporation . The Corporation reserves the right at any time, and from time to time, to amend, alter, change or repeal any provision contained in this Certificate of Incorporation and other provisions authorized by the laws of the State of Delaware at the time in force may be added or inserted, in the manner now or hereafter prescribed herein and by law, and all rights, preferences and privileges of any nature conferred upon stockholders, directors or any other persons by and pursuant to this Certificate of Incorporation in its present form or as hereafter amended are granted subject to this reservation. Notwithstanding any other provision of this Certificate of Incorporation or the Bylaws of the Corporation, and notwithstanding the fact that a lesser percentage or separate class vote may be specified by law or otherwise, but in addition to any affirmative vote of the holders of any particular class or series of the capital stock required by law or otherwise, no provision of ARTICLE SIX, ARTICLE SEVEN, ARTICLE EIGHT, ARTICLE TEN, ARTICLE ELEVEN or ARTICLE TWELVE of this Certificate of Incorporation may be altered, amended or repealed in any respect, nor may any provision of this Certificate of Incorporation or the Bylaws inconsistent therewith be adopted, unless in addition to any other vote required by this Certificate of Incorporation or otherwise required by law, (i) prior to the Trigger Date, such alteration, amendment, repeal or adoption is approved by, in addition to any other vote otherwise required by law, the affirmative vote of the holders of a majority of the voting power of all outstanding shares of Voting Stock, voting together as a single class, and (ii) from and after the Trigger Date, such alteration, amendment, repeal or adoption is approved by, in addition to any other vote otherwise required by law, the affirmative vote of holders of at least 66 2/3% of the voting power of all outstanding shares of Voting Stock, voting together as a single class, at a meeting of the Corporations stockholders called for that purpose.
ARTICLE TWELVE
Unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall, to the fullest extent permitted by applicable law, be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer, employee or stockholder (including a beneficial owner) of the Corporation to the Corporation or the Corporations stockholders, (iii) any action asserting a claim against the Corporation, its directors, officers or employees arising pursuant to any provision of the DGCL, this Certificate of Incorporation (as may be amended, altered, changed or repealed in accordance with Section 2 of ARTICLE ELEVEN) or the Bylaws of the Corporation or (iv) any action asserting a claim against the Corporation, its directors, officers or employees governed by the internal affairs doctrine, except for, as to each of (i) through (iv) above, any claim as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the
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Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction. If any provision or provisions of this ARTICLE TWELVE shall be held to be invalid, illegal or unenforceable as applied to any person or entity or circumstance for any reason whatsoever, then, to the fullest extent permitted by law, the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this ARTICLE TWELVE (including, without limitation, each portion of any sentence of this ARTICLE TWELVE containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) and the application of such provision to other persons or entities and circumstances shall not in any way be affected or impaired thereby. Any person or entity purchasing or otherwise acquiring any interest in any shares of the Corporation shall be deemed to have notice of and to have consented to the provisions of this ARTICLE TWELVE.
ARTICLE THIRTEEN
To the extent that any provision or part of any provision of this Certificate of Incorporation is found to be invalid or unenforceable, such invalidity or unenforceability shall not affect the validity or enforceability of any other provision or part of any other provision of this Certificate of Incorporation, and this Certificate of Incorporation shall be construed in all respects as if such invalid or enforceable provisions or parts were omitted.
ARTICLE FOURTEEN
The Effective Time of this Certificate of Incorporation shall be [●], 2017 at [●] a.m./p.m. local time in Wilmington, Delaware (the Effective Time ).
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Exhibit 3.5
FORM OF
SECOND AMENDED AND RESTATED BYLAWS
OF
SAILPOINT TECHNOLOGIES HOLDINGS, INC.
A Delaware corporation
(Adopted as of [●], 2017)
ARTICLE I
OFFICES
Section 1. Offices . SailPoint Technologies Holdings, Inc. (the Corporation ) may have an office or offices other than its registered office at such place or places, either within or outside the State of Delaware, as the Board of Directors of the Corporation (the Board of Directors ) may from time to time determine or the business of the Corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. Place of Meetings . The Board of Directors may designate a place, if any, either within or outside the State of Delaware, as the place of meeting for any annual meeting or for any special meeting.
Section 2. Annual Meeting . An annual meeting of the stockholders shall be held at such time as is specified by the Board of Directors. At the annual meeting, stockholders shall elect directors to succeed those whose terms expire at such annual meeting and transact such other business as properly may be brought before the annual meeting pursuant to Section 11 of this ARTICLE II. The Board of Directors may postpone, reschedule or cancel any annual meeting of stockholders previously scheduled by the Board of Directors.
Section 3. Special Meetings . Special meetings of the stockholders may only be called in the manner provided in the Corporations certificate of incorporation as then in effect (the Certificate of Incorporation ). Business transacted at any special meeting of stockholders shall be limited to business set forth in the notice of meeting. The Board of Directors may postpone, reschedule or cancel any special meeting of the stockholders previously scheduled by the Board of Directors.
Section 4. Notice of Meetings . Whenever stockholders are required or permitted to take action at a meeting, notice of the meeting shall be given that shall state the place, if any, date, and time of all meetings of the stockholders, the means of remote communications, if any, by which stockholders and proxyholders not physically present may be deemed to be present in person and vote at such meeting, the record date for determining the stockholders entitled to vote
at the meeting, if such date is different from the record date for determining stockholders entitled to notice of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Such notice shall be given, not less than ten (10) nor more than sixty (60) days before the date on which the meeting is to be held, to each stockholder entitled to vote at such meeting as of the record date for determining the stockholders entitled to notice of the meeting, except as otherwise provided herein or required by law (meaning, here and hereinafter, as required from time to time by the General Corporation Law of the State of Delaware (the DGCL ) or the Certificate of Incorporation).
(a) Form of Notice .
All such notices shall be delivered in writing or in any other manner permitted by the DGCL. If mailed, notice shall be deemed given when deposited in the United States mail, postage prepaid, addressed to the stockholder at his, her or its address as the same appears on the records of the Corporation. Subject to the limitations of Section 4(c) of this Article II, if given by facsimile telecommunication, such notice shall be deemed given when directed to a number at which the stockholder has consented to receive notice by facsimile. Subject to the limitations of Section 4(c) of this ARTICLE II, if given by electronic transmission, such notice shall be deemed to be delivered: (i) by electronic mail, when directed to an electronic mail address at which the stockholder has consented to receive notice; (ii) if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of (x) such posting and (y) the giving of such separate notice; and (iii) if by any other form of electronic transmission, when directed to the stockholder. An affidavit of the Secretary or an assistant Secretary of the Corporation, the transfer agent of the Corporation or any other agent of the Corporation that the notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein.
(b) Waiver of Notice .
Whenever notice is required to be given under any provisions of the DGCL, the Certificate of Incorporation or these Amended and Restated Bylaws (these Bylaws ), a written waiver thereof, signed by the stockholder entitled to notice, or a waiver by electronic transmission by the person or entity entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Neither the business to be transacted at, nor the purpose of, any meeting of the stockholders of the Corporation need be specified in any waiver of notice of such meeting. Attendance of a stockholder of the Corporation at a meeting of such stockholders shall constitute a waiver of notice of such meeting, except when the stockholder attends 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.
(c) Notice by Electronic Delivery . Without limiting the manner by which notice otherwise may be given effectively to stockholders of the Corporation pursuant to the DGCL, the Certificate of Incorporation or these Bylaws, any notice to stockholders of the Corporation given by the Corporation under any provision of the DGCL, the Certificate of Incorporation or these Bylaws shall be effective if given by a form of electronic transmission consented to by the stockholder of the Corporation to whom the notice is given. Any such consent shall be deemed revoked if: (i) the Corporation is unable to deliver by electronic
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transmission two (2) consecutive notices given by the Corporation in accordance with such consent; and (ii) such inability becomes known to the secretary or an assistant secretary of the Corporation or to the transfer agent or other person responsible for the giving of notice. However, the inadvertent failure to treat such inability as a revocation shall not invalidate any meeting or other action. For purposes of these Bylaws, except as otherwise limited by applicable law, the term electronic transmission means any form of communication not directly involving the physical transmission of paper that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such recipient through an automated process.
Section 5. List of Stockholders . The Corporation shall prepare and make available, at least 10 days before each 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 10 days before the meeting date, the list shall reflect the stockholders entitled to vote as of the 10th day before the meeting date, arranged in alphabetical order and showing the address of each such stockholder and the number of shares registered in the name of each such 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 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. In the event the Corporation determines to make the list available on an electronic network, the Corporation may take reasonable steps to ensure that such information is available only to stockholders of the Corporation. If the meeting is to be held at a place, the 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 the 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, the list shall be the only evidence as to who are the stockholders entitled to examine the list of stockholders required by this Section 5 or to vote in person or by proxy at any meeting of the stockholders.
Section 6. Quorum . The holders of a majority of the outstanding voting power of all shares of capital stock entitled to vote at the meeting, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders, except as otherwise required by law, or provided in the Certificate of Incorporation, the rules of any stock exchange upon which the Corporations securities are listed or these Bylaws. If a quorum is not present, the chairman of the meeting or the holders of a majority of the voting power present in person or represented by proxy at the meeting and entitled to vote at the meeting may adjourn the meeting to another time and/or place from time to time until a quorum shall be present or represented by proxy. When a specified item of business requires a separate vote by a class or series (if the Corporation shall then have outstanding shares of more than one class or series) voting as a class or series, the holders of a majority of the voting power of such class or series shall constitute a quorum (as to such class or series) for the transaction of such item of business.
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Section 7. Adjourned Meetings . When a meeting is adjourned to another time and place, notice need not be given of the adjourned meeting if the time and place, if any, thereof and the means of remote communications, 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 the adjournment is taken; provided , however , that if the adjournment is for more than 30 days, a notice of the place, if any, date and time of the adjourned meeting and the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such 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 stockholders entitled to vote is fixed for the adjourned meeting, the Board of Directors or a committee thereof designated by the Board of Directors shall fix a new record date for notice of such adjourned meeting in accordance with Section 213(a) of the DGCLand shall give notice of the adjourned meeting to each stockholder of record entitled to vote at such adjourned meeting as of the record date 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.
Section 8. Vote Required . When a quorum is present, the affirmative vote of the majority of voting power of capital stock present in person or represented by proxy at the meeting and entitled to vote on the subject matter shall be the act of the stockholders, unless by express provisions of an applicable law, the rules of any stock exchange upon which the Corporations securities are listed or the Certificate of Incorporation a different vote is required, in which case such express provision shall govern and control the decision of such question.
Section 9. Voting Rights . Except as otherwise provided by the DGCL, the Certificate of Incorporation, the certificate of designation relating to any outstanding class or series of preferred stock or these Bylaws, each stockholder entitled to vote at any meeting of stockholders shall be entitled to one vote in person or by proxy for each share of capital stock held by such stockholder which has voting power upon the matter in question. Voting at meetings of stockholders need not be by written ballot.
Section 10. Proxies . Each stockholder entitled to vote at a meeting of stockholders or to express consent to corporate action in writing without a meeting may authorize another person or persons to act for such stockholder by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A proxy may be made irrevocable regardless of whether the interest with which it is coupled is an interest in the stock itself or an interest in the Corporation generally.
Section 11. Business Brought Before a Meeting of the Stockholders .
(a) Annual Meetings .
(i) At an annual meeting of the stockholders, only such nominations of persons for election to the Board of Directors shall be considered and such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting, nominations and other business must be a proper matter for stockholder action under Delaware law and must be (A) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board of
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Directors, (B) brought before the meeting by or at the direction of the Board of Directors or (C) otherwise properly brought before the meeting by a stockholder who (I) is a stockholder of record of the Corporation (and, with respect to any beneficial owner, if different, on whose behalf such business is proposed or such nomination or nominations are made, only if such beneficial owner is the beneficial owner of shares of the Corporation) both at the time the notice provided for in paragraph (a) of this Section 11 of this ARTICLE II is delivered to the secretary of the Corporation and on the record date for the determination of stockholders entitled to vote at the annual meeting of stockholders, (II) is entitled to vote at the meeting, and (III) complies with the notice procedures set forth in paragraph (a) of this Section 11 of this ARTICLE II. For the avoidance of doubt, the foregoing clause (C) shall be the exclusive means for a stockholder to make nominations or propose business at an annual meeting of stockholders (other than proposals included in the Corporations proxy materials pursuant to Rule 14a-8 promulgated under the Exchange Act). For nominations or other business to be properly brought before an annual meeting by a stockholder, the stockholder must have given timely notice thereof in writing and in proper form to the Secretary of the Corporation. To be timely, a stockholders notice must be delivered to or mailed and received 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 years annual meeting ( provided , however , that in the event that the date of the annual meeting is more than thirty (30) days before or more than seventy (70) days after such anniversary date, or if no annual meeting was held in the preceding year, notice by the stockholder must be so delivered not earlier than the close of business on the one hundred twentieth (120th) day prior to such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to such annual meeting or the tenth (10th) day following the day on which Public Announcement of the date of such meeting is first made by the Corporation). In no event shall any adjournment, deferral 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 stockholders notice as described above. Notwithstanding anything in this paragraph to the contrary, in the event that the number of directors to be elected to the Board of Directors at an annual meeting is increased 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 years annual meeting, a stockholders notice required by paragraph (a) of this Section 11 of this ARTICLE II shall also be considered timely, but only with respect to nominees for the additional directorships, if it shall be delivered to 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.
(ii) A stockholders notice providing for the nomination of a person or persons for election as a director or directors of the Corporation shall set forth (A) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination is made (and for purposes of clauses (II) through (IX) below, including any interests described therein held by any affiliates or associates (each within the meaning of Rule 12b-2 under the Securities Exchange Act of 1934 (the Exchange Act ) for
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purposes of these Bylaws) of such stockholder or beneficial owner or by any member of such stockholders or beneficial owners immediate family sharing the same household), in each case as of the date of such stockholders notice, which information shall be confirmed or updated, if necessary, by such stockholder and beneficial owner as of the record date for determining the stockholders entitled to notice of the meeting of stockholders and as of the date that is ten (10) business days prior to such meeting of the stockholders or any adjournment or postponement thereof, and such confirmation or update shall be received by the Secretary at the principal executive offices of the Corporation not later than the close of business on the fifth (5th) business day after the record date for the meeting of stockholders (in the case of the update and supplement required to be made as of the record date), and not later than the close of business on the eighth (8th) business day prior to the date for the meeting of stockholders or any adjournment or postponement thereof (in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting of stockholders or any adjournment or postponement thereof)) (I) the name and address of such stockholder, as they appear on the Corporations books, and of such beneficial owner, (II) the class or series and number of shares of capital stock of the Corporation which are, directly or indirectly, beneficially owned (within the meaning of Rule 13d-3 under the Exchange Act) ( provided that a person 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 person has a right to acquire beneficial ownership at any time in the future) and owned of record by such stockholder or beneficial owner, (III) the class or series, if any, and number of options, warrants, puts, calls, convertible securities, stock appreciation rights, or similar rights, obligations or commitments with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares or other securities of the Corporation or with a value derived in whole or in part from the value of any class or series of shares or other securities of the Corporation, whether or not such instrument, right, obligation or commitment shall be subject to settlement in the underlying class or series of shares or other securities of the Corporation (each a Derivative Security ), which are, directly or indirectly, beneficially owned by such stockholder or beneficial owner, (IV) any agreement, arrangement, understanding, or relationship, including any repurchase or similar so-called stock borrowing agreement or arrangement, engaged in, directly or indirectly, by such stockholder or beneficial owner, the purpose or effect of which is to mitigate loss to, reduce the economic risk (of ownership or otherwise) of any class or series of capital stock or other securities of the Corporation, manage the risk of share price changes for, or increase or decrease the voting power of, such stockholder or beneficial owner with respect to any class or series of capital stock or other securities of the Corporation, or that provides, directly or indirectly, the opportunity to profit from any decrease in the price or value of any class or series or capital stock or other securities of the Corporation, (V) a description of any other direct or indirect opportunity to profit or share in any profit (including any performance-based fees) derived from any increase or decrease in the value of shares or other securities of the Corporation, (VI) any proxy, contract, arrangement, understanding or relationship pursuant to which such stockholder or beneficial owner has a right to vote any shares or other securities of the Corporation, (VII) any rights to dividends on the shares of the Corporation owned beneficially by such stockholder or such beneficial
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owner that are separated or separable from the underlying shares of the Corporation, (VIII) any proportionate interest in shares of the Corporation or Derivative Securities held, directly or indirectly, by a general or limited partnership in which such stockholder or beneficial owner is a general partner or, directly or indirectly, beneficially owns an interest in a general partner, if any, (IX) a description of all agreements, arrangements, and understandings between such stockholder or beneficial owner and any other person(s) (including their name(s)) in connection with or related to the ownership or voting of capital stock of the Corporation or Derivative Securities, (X) any other information relating to such stockholder or beneficial owner 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 the election of directors in a contested election pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder, (XI) a statement as to whether either such stockholder or beneficial owner intends to deliver a proxy statement and form of proxy to holders of shares representing at least 50% of the voting power of the capital stock entitled to vote in the election of directors and/or otherwise to solicit proxies from the stockholders in support of such nomination and (XII) a representation that the stockholder is a holder of record of shares of the Corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such nomination, and (B) as to each person whom the stockholder proposes to nominate for election or reelection as a director, (I) all information relating to such person that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors pursuant to the Exchange Act and the rules and regulations promulgated thereunder (including such persons written consent to being named in the proxy statement as a nominee and to serving as a director if elected and a statement that such person currently intends to serve for the full term for which such person is standing for election), (II) a description of all direct and indirect compensation and other material agreements, arrangements and understandings during the past three years, and any other material relationships, between or among such stockholder or beneficial owner, if any, and their respective affiliates and associates, or others acting in concert therewith, on the one hand, and each proposed nominee and his or her respective affiliates and associates, or others acting in concert therewith, on the other hand, including 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, or any affiliate or associate thereof or person acting in concert therewith, were the registrant for purposes of such rule and the nominee were a director or executive officer of such registrant, (III) a completed and signed questionnaire regarding the background and qualifications of such person to serve as a director, a copy of which may be obtained upon request to the Secretary of the Corporation, (IV) all information with respect to such person that would be required to be set forth in a stockholders notice pursuant to this Section 11 of this ARTICLE II if such person were a stockholder or beneficial owner, on whose behalf the nomination was made, submitting a notice providing for the nomination of a person or persons for election as a director or directors of the Corporation in accordance with this Section 11 of this ARTICLE II, and (V) such additional information that the Corporation may reasonably request to determine the eligibility or qualifications of such person to serve as a director or an independent
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director of the Corporation, or that could be material to a reasonable stockholders understanding of the qualifications and/or independence, or lack thereof, of such nominee as a director.
(iii) A stockholders notice regarding business proposed to be brought before a meeting of stockholders other than the nomination of persons for election to the Board of Directors shall set forth (A) as to the stockholder giving notice and the beneficial owner, if any, on whose behalf the proposal is made, the information called for by clauses (A)(I) through (A)(IX) of the immediately preceding paragraph (ii) (including any interests described therein held by any affiliates or associates of such stockholder or beneficial owner or by any member of such stockholders or beneficial owners immediate family sharing the same household, in each case as of the date of such stockholders notice), which information shall be confirmed or updated, if necessary, by such stockholder and beneficial owner as of the record date for determining the stockholders entitled to notice of the meeting of stockholders and as of the date that is ten (10) business days prior to such meeting of the stockholders or any adjournment or postponement thereof, and such confirmation or update shall be received by the Secretary at the principal executive offices of the Corporation not later than the close of business on the fifth (5th) business day after the record date for the meeting of stockholders (in the case of the update and supplement required to be made as of the record date), and not later than the close of business on the eighth (8th) business day prior to the date for the meeting of stockholders or any adjournment or postponement thereof (in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting of stockholders or any adjournment or postponement thereof)), (B) a brief description of (I) the business desired to be brought before such meeting, (II) the reasons for conducting such business at the meeting and (III) any material interest of such stockholder or beneficial owner in such business, including a description of all agreements, arrangements and understandings between such stockholder or beneficial owner and any other person(s) (including the name(s) of such other person(s)) in connection with or related to the proposal of such business by the stockholder, (C) as to the stockholder giving notice and the beneficial owner, if any, on whose behalf the proposal is made, (I) a statement as to whether either such stockholder or beneficial owner intends to deliver a proxy statement and form of proxy to holders of at least the percentage of the Corporations voting shares required under applicable law to approve the proposal and/or otherwise to solicit proxies from stockholders in support of such proposal and (II) any other information relating to such stockholder or beneficial owner that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies in support of the business proposed to be brought before the meeting pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder, (D) if the matter such stockholder proposes to bring before any meeting of stockholders involves an amendment to the Corporations Bylaws, the specific wording of such proposed amendment, (E) a representation that the stockholder is a holder of record of shares of the Corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such business and (F) such additional information that the Corporation may reasonably request regarding such stockholder or beneficial owner, if any, and/or the business that such stockholder proposes to bring before the meeting. The foregoing notice requirements
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shall be deemed satisfied by a stockholder if the stockholder has notified the Corporation of his or her intention to present a proposal at an annual meeting in compliance with Rule 14a-8 (or any successor thereof) promulgated under the Exchange Act and such stockholders proposal has been included in a proxy statement that has been prepared by the Corporation to solicit proxies for such annual meeting.
(iv) The presiding officer of an annual meeting shall, if the facts warrant, determine and declare to the meeting that a nomination was not properly made or that any business was not properly brought before the meeting, as the case may be, in accordance with the provisions of Section 11 of this ARTICLE II; if he or she should so determine, he or she shall so declare to the meeting and any such nomination not properly made or any business not properly brought before the meeting, as the case may be, shall not be transacted.
(b) Special Meetings of Stockholders . Only such business shall be conducted at a special meeting of stockholders as is a proper matter for stockholder action under Delaware law and as shall have been brought before the meeting by or at the direction of the Board of Directors or by the other persons entitled to cause the meeting to be called pursuant to the Certificate of Incorporation. The notice of such special meeting shall include the purpose for which the meeting is called. Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to the Corporations notice of meeting (i) by or at the direction of the Board of Directors or (ii) provided that the Board of Directors (or other persons entitled to cause the meeting to be called pursuant to the Certificate of Incorporation) has determined that directors shall be elected at such meeting, by any stockholder of the Corporation who (A) is a stockholder of record of the Corporation (and, with respect to any beneficial owner, if different, on whose behalf such nomination or nominations are made, only if such beneficial owner is the beneficial owner of shares of the Corporation) both at the time the notice provided for in paragraph (b) of this Section 11 of this ARTICLE II is delivered to the Corporations Secretary and on the record date for the determination of stockholders entitled to vote at the special meeting, (B) is entitled to vote at the meeting and upon such election, and (C) complies with the notice procedures set forth in the third sentence of paragraph (b) of this Section 11 of this ARTICLE II. In the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more directors to the Board of Directors, 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 Corporations notice of meeting, if the stockholders notice required by paragraph (a)(ii) of this Section 11 of this ARTICLE II shall be delivered to the Corporations 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 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 the tenth (10th) day following the day on which Public Announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. In no event shall any adjournment, deferral 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 stockholders notice as described above.
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(c) General .
(i) Only such persons who are nominated in accordance with the procedures set forth in this Section 11 of this ARTICLE II 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 11 of this ARTICLE II. Notwithstanding the foregoing provisions of this Section 11 of this ARTICLE II, 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 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 11, to be considered a qualified representative of the stockholder, a person 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 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 this section, Public Announcement shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press, Business Wire, PR Newswire or a comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act.
(iii) Notwithstanding the foregoing provisions of these Bylaws, 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 in these Bylaws; 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 the requirements applicable to any nomination or other business to be considered pursuant to Section 11 of this ARTICLE II.
(iv) Nothing in these Bylaws shall be deemed to (A) affect any rights of stockholders to request inclusion of proposals in the Corporations proxy statement pursuant to Rule 14a-8 under the Exchange Act, (B) confer upon any stockholder a right to have a nominee or any proposed business included in the Corporations proxy statement, or (C) affect any rights of the holders of any series of preferred stock to elect directors pursuant to any applicable provisions of the Certificate of Incorporation or (D) affect any right of TB Fund XI (as defined in the Certificate of Incorporation) to elect or nominate directors pursuant to any applicable provisions of the Certificate of Incorporation.
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Section 12. Fixing a Record Date for Stockholder Meetings . In order that the Corporation may determine the stockholders entitled to notice of any meeting of stockholders or any adjournment thereof, the Board of Directors, or a committee designated by the Board of Directors, may fix, except as otherwise required by law, in advance, a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors or a committee thereof designated by the Board of Directors, as applicable, and which record date shall not be more than sixty (60) days nor less than ten (10) days before the date of such meeting. If the Board of Directors or a committee thereof 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 of Directors or such committee 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 of Directors or a committee thereof designated by the Board of Directors, the record date for determining stockholders entitled to notice of and to vote at a meeting of stockholders shall be the close of business on the 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 any adjournment of the meeting; provided , however , that the Board of Directors or a committee thereof designated by the Board of Directors 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 with the foregoing provisions of this Section 12 at the adjourned meeting.
Section 13. Action by Stockholders Without a Meeting . So long as stockholders of the Corporation have the right to act by written consent in accordance with Section 1 of ARTICLE EIGHT of the Certificate of Incorporation, the following provisions shall apply:
(a) Record Date . For the purpose of determining the stockholders entitled to consent to corporate action in writing without a meeting as may be permitted by the Certificate of Incorporation or the certificate of designation relating to any outstanding class or series of preferred stock, the Board of Directors, or a committee thereof designated by the Board of Directors, may fix a record date, which record date shall not precede the date on which the resolution fixing the record date is adopted by the Board of Directors or such committee, as applicable, and which record date shall not be more than ten (10) (or the maximum number permitted by applicable law) days after the date on which the resolution fixing the record date is adopted by the Board of Directors or such committee. Any stockholder of record seeking to have the stockholders authorize or take action by written consent shall, by written notice to the Secretary, request that the Board of Directors or a committee thereof designated by the Board of Directors fix a record date, which notice shall include the text of any proposed resolutions. If no record date has been fixed by the Board of Directors or committee thereof pursuant to this Section 13(a) or otherwise within ten (10) days of receipt of a valid request by a stockholder, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors or any committee thereof is
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required pursuant to applicable law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation pursuant to Section 213(b) of the DGCL. If no record date has been fixed by the Board of Directors or a committee thereof and prior action by the Board of Directors or a committee thereof is required by applicable law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall in such an event be at the close of business on the day on which the Board of Directors or a committee thereof designated by the Board of Directors adopts the resolution taking such prior action.
(b) Generally . No written consent shall be effective to take the corporate action referred to therein unless written consents signed by a sufficient number of stockholders to take such action are delivered to the Corporation, in the manner required by Section 228 of the DGCL, within sixty (60) (or the maximum number permitted by applicable law) days of the first date on which a written consent is delivered to the Corporation in the manner required by Section 228 of the DGCL. The validity of any consent executed by a proxy for a stockholder pursuant to an electronic transmission transmitted to such proxy holder by or upon the authorization of the stockholder shall be determined by or at the direction of the Secretary. A written record of the information upon which the person making such determination relied shall be made and kept in the records of the proceedings of the stockholders. Any such consent shall be inserted in the minute book as if it were the minutes of a meeting of stockholders. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given by the Corporation (at its expense) to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for notice of such meeting had been the date that written consent signed by a sufficient number of holders to take the action were delivered to the Corporation.
Section 14. Conduct of Meetings .
(a) Generally . Meetings of stockholders shall be presided over by the Chairman of the Board, if any, or in the Chairmans absence or disability by the Chief Executive Officer, or in the Chief Executive Officers absence or disability, by the President, or in the Presidents absence or disability, by a Vice President, or in the absence or disability of the foregoing persons by a chairperson designated by the Board of Directors, or in the absence of such designation by a chairperson chosen at the meeting. The Secretary shall act as secretary of the meeting, but in the Secretarys absence or disability the chairman of the meeting may appoint any person to act as secretary of the meeting.
(b) Rules, Regulations and Procedures . The Board of Directors 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 of Directors, the chairman of any
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meeting of stockholders shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the chairman 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 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. The chairman of the meeting of stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall, if the facts warrant, determine and declare to the meeting that a nomination or matter or business was not properly brought before the meeting and if such chairman should so determine, such chairman shall so declare to the meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered. Unless and to the extent determined by the Board of Directors or the chairman of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure. The chairman 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. Unless ordered by a court of competent jurisdiction, after the polls close, no ballots, proxies or votes or any revocations or changes thereto may be accepted. The chairman of the meeting shall have the power, for any reason (whether or not a quorum is present), to recess and/or to adjourn any meeting of stockholders to another place, if any, date and time.
(c) Inspectors of Elections . The Corporation may, and to the extent 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 chairman of the meeting shall appoint one or more inspectors to act at the meeting. Unless otherwise required by law, inspectors may be officers, employees or agents of the Corporation. No person who is a candidate for an office at an election may serve as an inspector at such election. Each inspector, before entering upon the discharge of such inspectors duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of such inspectors ability. The inspector shall have the duties prescribed by law and shall take charge of the polls and, when the vote is completed, shall make a certificate 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.
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ARTICLE III
DIRECTORS
Section 1. General Powers . Subject to the Certificate of Incorporation, the business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to such powers as are herein and in the Certificate of Incorporation expressly conferred upon it, the Board of Directors shall have and may exercise all the powers of the Corporation, subject to the provisions of the laws of the State of Delaware, the Certificate of Incorporation and these Bylaws.
Section 2. Election . Subject to the Certificate of Incorporation, members of the Board of Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote in the election of directors; provided that, whenever the holders of any class or series of capital stock of the Corporation are entitled to elect one or more directors pursuant to the provisions of the Certificate of Incorporation (including, but not limited to, any duly authorized certificate of designation), such directors shall be elected by a plurality of the votes of such class or series present in person or represented by proxy at the meeting and entitled to vote in the election of such directors. Elections of directors need not be by written ballot.
Section 3. Annual Meetings . The annual meeting of the Board of Directors shall be held without other notice than this Bylaw immediately after, and at the same place as, the annual meeting of stockholders.
Section 4. Regular Meetings and Special Meetings . Regular meetings, other than the annual meeting, of the Board of Directors may be held without notice at such time and at such place as shall from time to time be determined by resolution of the Board of Directors and publicized among all directors. Special meetings of the Board of Directors may be called by the Chairman of the Board, if any, or upon the written request of at least a majority of the directors then in office.
Section 5. Notice of Meetings . Notice of regular meetings of the Board of Directors need not be given except as otherwise required by law or these Bylaws. Notice of each special meeting of the Board of Directors, and of each regular and annual meeting of the Board of Directors for which notice is required, shall be given by the Secretary (or his or her delegate) as hereinafter provided in this Section 5 of ARTICLE III. Such notice shall state the date, time and place, if any, of the meeting. Notice of any special meeting, and of any regular or annual meeting for which notice is required, shall be given to each director at least (a) twenty-four (24) hours before the meeting if by telephone or by being personally delivered or sent by telex, telecopy, email or similar means or (b) five (5) days before the meeting if delivered by mail to the directors residence or usual place of business. Such notice shall be deemed to be delivered when deposited in the United States mail so addressed, with postage prepaid, or when transmitted if sent by telex, telecopy, email or similar means. Neither the business to be transacted at, nor the purpose of, any special meeting of the Board of Directors need be specified in the notice or waiver of notice of such meeting.
Section 6. Waiver of Notice Whenever notice is required to be given to a director under any provision of the DGCL or the Certificate of Incorporation or these Bylaws, a written waiver, signed by the director entitled to notice, or a waiver by electronic transmission by the director entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a director at a meeting of directors or members of a committee of directors shall constitute a waiver of notice of such meeting, except when the person attends a meeting for
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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. Neither the business to be transacted at, nor the purpose of, any annual, regular or special meeting of directors or members of a committee of directors need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the Certificate of Incorporation or these Bylaws.
Section 7. Chairman of the Board, Quorum, Required Vote and Adjournment . The Board of Directors may elect, by the affirmative vote of a majority of the directors then in office, a Chairman of the Board. Notwithstanding the foregoing, Thoma Bravo Fund XI, L.P. ( TB Fund XI ) shall have the right to designate the Chairman of the Board of Directors for so long as TB Fund XI, Thoma Bravo Fund XI-A, L.P. and Thoma Bravo Executive Fund XI, L.P. (collectively, the TB Funds ), including through their Affiliates, beneficially own (directly or indirectly) in the aggregate at least 30% of the outstanding Common Stock of the Corporation. The Chairman of the Board may be a director or an officer of the Corporation. Subject to the provisions of these Bylaws and the direction of the Board of Directors, he or she shall perform all duties and have all powers which are commonly incident to the position of Chairman of the Board or which are delegated to him or her by the Board of Directors, preside at all meetings of the stockholders and Board of Directors at which he or she is present and have such powers and perform such duties as the Board of Directors may from time to time prescribe. If the Chairman of the Board is not present at a meeting of the stockholders or the Board of Directors, the Chief Executive Officer (if the Chief Executive Officer is a director and is not also the Chairman of the Board) shall preside at such meeting, and, if the Chief Executive Officer is not present at such meeting, a majority of the directors present at such meeting shall elect one of the directors present at the meeting to so preside. A majority of the directors then in office shall constitute a quorum for the transaction of business, provided that the number of directors who constitute a quorum shall not be less than one-third of the total number of authorized directorships. Unless by express provision of an applicable law, the Certificate of Incorporation or these Bylaws a different vote is required, the affirmative vote of a majority of directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. At any meeting of the Board of Directors, business shall be transacted in such order and manner as the Board of Directors may from time to time determine. If a quorum shall not be present at any meeting of the Board of Directors, the directors present thereat may, to the fullest extent permitted by law, adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.
Section 8. Committees . The Board of Directors (i) may, by resolution passed by a majority of the directors then in office, designate one or more committees, including an executive committee, consisting of one or more of the directors of the Corporation, and (ii) shall during such period of time as any securities of the Corporation are listed on any exchange, by resolution passed by a majority of the directors then in office, designate all committees required by the rules and regulations of such exchange. TB Fund XI shall have the right to designate the chairman of each committee designated by the Board of Directors for so long as the TB Funds, including through their Affiliates, beneficially own (directly or indirectly) in the aggregate at least 30% of the outstanding Common Stock of the Corporation; provided that, the committee membership of each committee designated by the Board of Directors will comply with the applicable rules of the exchange on which any securities of the Corporation are listed. The Board of Directors may designate one or more directors as alternate members of any committee,
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who may replace any absent or disqualified member at any meeting of the committee. Except to the extent restricted by applicable law or the Certificate of Incorporation, each such committee, to the extent provided by the DGCL and in the resolution creating it, shall have and may exercise all the powers and authority of the Board of Directors. Each such committee shall serve at the pleasure of the Board of Directors as may be determined from time to time by resolution adopted by the Board of Directors or as required by the rules and regulations of such exchange, if applicable. Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors upon request.
Section 9. Committee Rules . Each committee of the Board of Directors may fix its own rules of procedure and shall hold its meetings as provided by such rules, except as may otherwise be provided by a resolution of the Board of Directors designating such committee or as otherwise provided herein or required by law or the Certificate of Incorporation. Adequate provision shall be made for notice to members of all meetings. Unless otherwise provided in such a resolution, the presence of at least a majority of the members of the committee shall be necessary to constitute a quorum. All matters shall be determined by a majority vote of the members present at a meeting at which a quorum is present. Unless otherwise provided in such a resolution, in the event that a member of such committee is or are absent or disqualified, the member or members thereof 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 of Directors to act at the meeting in place of any such absent or disqualified member.
Section 10. Action by Written Consent . Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken without a meeting if all members of the Board of Directors or such committee, as the case may be, consent thereto in writing or by electronic transmission, and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the board or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form. Any person (whether or not then a director) may provide, whether through instruction to an agent or otherwise, that a consent to action will be effective at a future time (including a time determined upon the happening of an event), no later than 60 days after such instruction is given or such provision is made and such consent shall be deemed to have been given for purposes of this subsection at such effective time so long as such person is then a director and did not revoke the consent prior to such time. Any such consent shall be revocable prior to its becoming effective.
Section 11. Compensation . Unless otherwise restricted by the Certificate of Incorporation, the Board of Directors shall have the authority to fix the compensation, including fees, reimbursement of expenses and equity compensation of directors for services to the Corporation in any capacity, including for attendance of meetings of the Board of Directors or participation on any committees. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor.
Section 12. Reliance on Books and Records . A member of the Board of Directors, or a member of any committee designated by the Board of Directors shall, in the performance of such members duties, be fully protected in relying in good faith upon records of the Corporation and
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upon such information, opinions, reports or statements presented to the Corporation by any of the Corporations officers or employees, or committees of the Board of Directors, or by any other person as to matters the member reasonably believes are within such other persons professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation.
Section 13. Telephonic and Other Meetings . Unless restricted by the Certificate of Incorporation, any one or more members of the Board of Directors or any committee thereof may participate in a meeting of the Board of Directors or such committee by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other. Participation by such means shall constitute presence in person at a meeting.
ARTICLE IV
OFFICERS
Section 1. Number . The officers of the Corporation shall be elected by the Board of Directors and shall consist of a Chief Executive Officer, a President, one or more Vice Presidents, a Secretary, a Chief Financial Officer and such other officers and assistant officers as may be deemed necessary or desirable by the Board of Directors. Any number of offices may be held by the same person. In its discretion, the Board of Directors may choose not to fill any office for any period as it may deem advisable.
Section 2. Election and Term of Office . The officers of the Corporation shall be elected annually by the Board of Directors at its first meeting held after each annual meeting of stockholders or as soon thereafter as is convenient. The Chairman of the Board, if any, shall be elected annually by the Board of Directors at the first meeting of the Board of Directors held after each annual meeting of stockholders or as soon thereafter as is convenient. Vacancies may be filled or new offices created and filled by the Board of Directors. Each officer shall hold office until a successor is duly elected and qualified or until his or her earlier death, resignation or removal as hereinafter provided.
Section 3. Removal . Any officer or agent elected by the Board of Directors may be removed with or without cause by the Board of Directors, a duly authorized committee thereof or by such officers as may be designated by a resolution of the Board of Directors, but such removal shall be without prejudice to the contract rights, if any, of the person so removed.
Section 4. Vacancies . Any vacancy occurring in any office because of death, resignation, removal, disqualification or otherwise may be filled by the Board of Directors.
Section 5. Compensation . Compensation of all executive officers shall be approved by the Board of Directors, a duly authorized committee thereof or by such officers as may be designated by resolution of the Board of Directors, and no officer shall be prevented from receiving such compensation by virtue of his or her also being a director of the Corporation.
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Section 6. Chief Executive Officer . The Chief Executive Officer shall have the powers and perform the duties incident to that position. The Chief Executive Officer shall, in the absence of the Chairman of the Board, or if a Chairman of the Board shall not have been elected, preside at each meeting of (a) the Board of Directors if the Chief Executive Officer is a director or (b) the stockholders. Subject to the powers of the Board of Directors and the Chairman of the Board, the Chief Executive Officer shall be in general and active charge of the entire business and affairs of the Corporation, and shall be its chief policy making officer. The Chief Executive Officer shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or provided in these Bylaws. The Chief Executive Officer is authorized to execute bonds, mortgages and other contracts requiring a seal, under the seal of the Corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the Board of Directors to some other officer or agent of the Corporation. Whenever the President is unable to serve, by reason of sickness, absence or otherwise, the Chief Executive Officer shall perform all the duties and responsibilities and exercise all the powers of the President.
Section 7. The President . The President of the Corporation shall, subject to the powers of the Board of Directors, the Chairman of the Board and the Chief Executive Officer, have general charge of the business, affairs and property of the Corporation, and control over its officers, agents and employees. The President shall see that all orders and resolutions of the Board of Directors are carried into effect. The President is authorized to execute bonds, mortgages and other contracts requiring a seal, under the seal of the Corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the Board of Directors to some other officer or agent of the Corporation. The President shall have such other powers and perform such other duties as may be prescribed by the Chairman of the Board, the Chief Executive Officer, the Board of Directors or as may be provided in these Bylaws. The President shall have the powers and perform the duties incident to that position.
Section 8. Vice Presidents . The Vice President, or if there shall be more than one, the Vice Presidents, in the order determined by the Board of Directors or the Chairman of the Board, shall, in the absence or disability of the President, act with all of the powers and be subject to all the restrictions of the President. The Vice Presidents shall also perform such other duties and have such other powers as the Board of Directors, the Chairman of the Board, the Chief Executive Officer, the President or these Bylaws may, from time to time, prescribe. The Vice Presidents may also be designated as Executive Vice Presidents or Senior Vice Presidents, as the Board of Directors may from time to time prescribe. A Vice President shall have the powers and perform the duties incident to that position.
Section 9. The Secretary and Assistant Secretaries . The Secretary shall attend all meetings of the Board of Directors (other than executive sessions thereof) and all meetings of the stockholders and record all the proceedings of the meetings in a book or books to be kept for that purpose or shall ensure that his or her designee attends each such meeting to act in such capacity. Under the Board of Directors supervision, the Secretary shall give, or cause to be given, all notices required to be given by these Bylaws or by law; shall have such powers and perform such duties as the Board of Directors, the Chairman of the Board, the Chief Executive Officer, the President or these Bylaws may, from time to time, prescribe; and shall have custody of the
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corporate seal of the Corporation. The Secretary, or an Assistant Secretary, shall have authority to affix the corporate seal to any instrument requiring it and when so affixed, it may be attested by his or her signature or by the signature of such Assistant Secretary. The Board of Directors may give general authority to any other officer to affix the seal of the Corporation and to attest the affixing by his or her signature. The Assistant Secretary, or if there be more than one, any of the assistant secretaries, shall in the absence or disability of the Secretary, perform the duties and exercise the powers of the Secretary and shall perform such other duties and have such other powers as the Board of Directors, the Chairman of the Board, the Chief Executive Officer, the President, or Secretary may, from time to time, prescribe. The Secretary and any Assistant Secretary shall have the powers and perform the duties incident to those positions.
Section 10. The Chief Financial Officer . The Chief Financial Officer shall have the custody of the corporate funds and securities; shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation as shall be necessary or desirable in accordance with applicable law or generally accepted accounting principles; shall deposit all monies and other valuable effects in the name and to the credit of the Corporation as may be ordered by the Chairman of the Board, the Board of Directors, the Chief Executive Officer or the President; shall receive, and give receipts for, moneys due and payable to the Corporation from any source whatsoever; shall cause the funds of the Corporation to be disbursed when such disbursements have been duly authorized, taking proper vouchers for such disbursements; and shall render to the Board of Directors, at its regular meeting or when the Board of Directors so requires, an account of the Corporation; shall have such powers and perform such duties as the Board of Directors, the Chairman of the Board, the Chief Executive Officer, the President or these Bylaws may, from time to time, prescribe. The Chief Financial Officer shall have the powers and perform the duties incident to that position.
Section 11. Other Officers, Assistant Officers and Agents . Officers, assistant officers and agents, if any, other than those whose duties are provided for in these Bylaws, shall have such authority and perform such duties as may from time to time be prescribed by resolution of the Board of Directors and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board of Directors.
Section 12. Officers Bonds or Other Security . If required by the Board of Directors, any officer of the Corporation shall give a bond or other security for the faithful performance of his duties, in such amount and with such surety as the Board of Directors may require.
Section 13. Delegation of Authority . The Board of Directors may by resolution delegate the powers and duties of such officer to any other officer or to any director, or to any other person whom it may select.
ARTICLE V
CERTIFICATES OF STOCK
Section 1. Form . The shares of stock of the Corporation shall be represented by certificates, provided that the Board of Directors may provide by resolution that some or all of any or all classes or series of its stock shall be uncertificated shares. Any such resolution shall
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not apply to shares represented by a certificate until such certificate is surrendered to the Corporation. If shares are represented by certificates, the certificates shall be in such form as required by applicable law and as determined by the Board of Directors. Each certificate shall certify the number of shares owned by such holder in the Corporation and shall be signed by, or in the name of the Corporation by (i) the Chairman of the Board, the Chief Executive Officer, the President or a Vice President and (ii) the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary designated by the Board of Directors. Any or all signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed, or whose facsimile signature or signatures have been used on, any such certificate or certificates shall cease to be such officer, transfer agent or registrar of the Corporation whether because of death, resignation or otherwise before such certificate or certificates have been issued by the Corporation, such certificate or certificates may nevertheless be issued as though the person or persons who signed such certificate or certificates or whose facsimile signature or signatures have been used thereon had not ceased to be such officer, transfer agent or registrar of the Corporation at the date of issue. All certificates for shares shall be consecutively numbered or otherwise identified. The Board of Directors may appoint a bank or trust company organized under the laws of the United States or any state thereof to act as its transfer agent or registrar, or both in connection with the transfer of any class or series of securities of the Corporation. The Corporation, or its designated transfer agent or other agent, shall keep a book or set of books to be known as the stock transfer books of the Corporation, containing the name of each holder of record, together with such holders address and the number and class or series of shares held by such holder and the date of issue. When shares are represented by certificates, the Corporation shall issue and deliver to each holder to whom such shares have been issued or transferred, certificates representing the shares owned by such holder, and shares of stock of the Corporation shall only be transferred on the books of the Corporation by the holder of record thereof or by such holders attorney duly authorized in writing, upon surrender to the Corporation or its designated transfer agent or other agent of the certificate or certificates for such shares endorsed by the appropriate person or persons, with such evidence of the authenticity of such endorsement, transfer, authorization and other matters as the Corporation may reasonably require, and accompanied by all necessary stock transfer stamps. In that event, it shall be the duty of the Corporation to issue a new certificate to the person entitled thereto, cancel the old certificate or certificates and record the transaction on its books. When shares are not represented by certificates, shares of stock of the Corporation shall only be transferred on the books of the Corporation by the holder of record thereof or by such holders attorney duly authorized in writing, with such evidence of the authenticity of such transfer, authorization and other matters as the Corporation may reasonably require, and accompanied by all necessary stock transfer stamps, and within a reasonable time after the issuance or transfer of such shares, the Corporation shall send the holder to whom such shares have been issued or transferred a written statement of the information required by applicable law. Unless otherwise provided by applicable law, the Certificate of Incorporation, Bylaws or any other instrument, the rights and obligations of the holders of uncertificated stock and the rights and obligations of the holders of certificates representing stock of the same class and series shall be identical.
Section 2. Lost Certificates . The Corporation may issue or direct a new certificate or certificates or uncertificated shares to be issued in place of any certificate or certificates previously issued by the Corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen
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or destroyed. When authorizing such issue of a new certificate or certificates or uncertificated shares, the Corporation may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or his or her legal representative, to give the Corporation a bond in such sum as it may direct, sufficient to indemnify the Corporation against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares.
Section 3. Registered Stockholders . Except as otherwise required by law, the Corporation shall be entitled to recognize the exclusive right of a person registered on its records as the owner of shares of stock to receive dividends, to vote, to receive notifications and otherwise to exercise all the rights and powers of an owner. The Corporation shall not be bound to recognize any equitable or other claim to or interest in such share or shares of stock on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise required by applicable law.
Section 4. Fixing a Record Date for Purposes Other Than Stockholder Meetings or Actions by Written Consent . In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment or any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purposes of any other lawful action (other than stockholder meetings and stockholder written consents which are expressly governed by Sections 12 and 13 of ARTICLE II hereof), the Board of Directors or a committee thereof designated by the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty (60) days prior to such action. If no 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 of Directors or a committee thereof designated by the Board of Directors adopts the resolution relating thereto.
Section 5. Regulations . The issue, transfer, conversion and registration of certificates of stock shall be governed by such other regulations as the Board of Directors may establish.
ARTICLE VI
GENERAL PROVISIONS
Section 1. Dividends . Subject to the provisions of statutes and the Certificate of Incorporation, dividends upon the shares of capital stock of the Corporation may be declared and paid by the Board of Directors, in accordance with applicable law. Dividends may be paid in cash, in property or in shares of the Corporations theretofore unissued capital stock, subject to the provisions of applicable law and the Certificate of Incorporation. Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the Board of Directors from time to time, in its absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation or for such other purpose as the Board of Directors may think conducive to the interests of the Corporation. The Board of Directors may modify or abolish any such reserves in the manner in which they were created.
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Section 2. Checks, Notes, Drafts, Etc . All checks, notes, drafts or other orders for the payment of money of the Corporation shall be signed, endorsed or accepted in the name of the Corporation by such officer, officers, person or persons as from time to time may be authorized by the Board of Directors or by an officer or officers authorized by the Board of Directors to make such designation.
Section 3. Contracts . In addition to the powers otherwise granted to officers pursuant to ARTICLE IV hereof, the Board of Directors may authorize any officer or officers, or any agent or agents, in the name and on behalf of the Corporation to enter into or execute and deliver any and all deeds, bonds, mortgages, contracts and other obligations or instruments, and such authority may be general or confined to specific instances.
Section 4. Loans . Subject to compliance with applicable law (including Section 13(k) of the Securities Exchange Act of 1934), the Corporation may lend money to, or guarantee any obligation of, or otherwise assist any officer or other employee of the Corporation or of its subsidiaries, including any officer or employee who is a director of the Corporation or its subsidiaries, whenever, in the judgment of the directors, such loan, guaranty or assistance may reasonably be expected to benefit the Corporation. The loan, guaranty or other assistance may be with or without interest, and may be unsecured, or secured in such manner as the Board of Directors shall approve, including, without limitation, a pledge of shares of stock of the Corporation. Nothing in this section shall be deemed to deny, limit or restrict the powers of guaranty or warranty of the Corporation at common law or under any statute.
Section 5. Fiscal Year . The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.
Section 6. Corporate Seal . The Board of Directors may provide a corporate seal which shall be in the form of a circle and shall have inscribed thereon the name of the Corporation and the words Corporate Seal, Delaware. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise. Notwithstanding the foregoing, no seal shall be required by virtue of this Section 6.
Section 7. Voting Securities Owned By Corporation . The Chairman of the Board, the Chief Executive Officer, the President or the Chief Financial Officer shall have power to vote and otherwise act on behalf of the Corporation, in person or by proxy, at any meeting of stockholders of or with respect to any action of stockholders of any other corporation in which this Corporation may hold securities and otherwise to exercise any and all rights and powers which this Corporation may possess by reason of its ownership of securities in such other corporation, unless the Board of Directors specifically confers authority to vote or act with respect thereto, which authority may be general or confined to specific instances, upon some other person or officer. Any person authorized to vote securities shall have the power to appoint proxies, with general power of substitution.
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Section 8. Time Periods . In applying any provision of these Bylaws which requires that an act be done or not be done a specified number of days prior to an event or that an act be done during a period of a specified number of days prior to an event, calendar days shall be used, the day of the doing of the act shall be excluded and the day of the event shall be included.
Section 9. Inspection of Books and Records . Subject to applicable law, the Board of Directors shall have power from time to time to determine to what extent and at what times and places and under what conditions and regulations the accounts and books of the Corporation, or any of them, shall be open to the inspection of the stockholders; and no stockholder shall have any right to inspect any account or book or document of the Corporation, except as conferred by the laws of the State of Delaware, unless and until authorized to do so by resolution of the Board of Directors.
Section 10. Facsimile Signatures . In addition to the provisions for use of facsimile signatures elsewhere specifically authorized in these Bylaws, facsimile signatures of any officer or officers of the Corporation may be used whenever and as authorized by the Board of Directors or a committee thereof.
Section 11. Section Headings . Section headings in these Bylaws are for convenience of reference only and shall not be given any substantive effect in limiting or otherwise construing any provision herein.
Section 12. Inconsistent Provisions . In the event that any provision of these Bylaws is or becomes inconsistent with any provision of the Certificate of Incorporation, the DGCL or any other applicable law, the provision of these Bylaws shall not be given any effect to the extent of such inconsistency but shall otherwise be given full force and effect.
ARTICLE VII
INDEMNIFICATION
Section 1. Right to Indemnification and Advancement . Each person who was or is made a party or is threatened to be made a party to or is otherwise involved (including involvement, without limitation, as a witness) in any actual or threatened action, suit or proceeding, whether civil, criminal, administrative or investigative (a proceeding ), by reason of the fact that he or she 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 an employee or agent of the Corporation or as a director, officer, partner, member, trustee, administrator, employee or agent of another corporation or of a partnership, joint venture, limited liability company, trust or other enterprise, including service with respect to an employee benefit plan (an indemnitee ), whether the basis of such proceeding is alleged action in an official capacity as a director or officer or in any other capacity while serving as a director or officer, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the DGCL, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than permitted prior thereto), against all expense, liability and loss (including attorneys fees and related disbursements, judgments, fines, excise taxes, penalties and amounts paid or to
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be paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith and such indemnification shall continue as to an indemnitee who has ceased to be a director, officer, partner, member, trustee, administrator, employee or agent and shall inure to the benefit of the indemnitees heirs, executors and administrators; provided , however , that, except as provided in Section 2 of this ARTICLE VII with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the Board of Directors of the Corporation. The right to indemnification conferred in this Section 1 of this ARTICLE VII shall be a contract right. In addition to the right to indemnification conferred herein, an indemnitee shall also have the right to be paid by the Corporation the expenses incurred in defending any such proceeding in advance of its final disposition (an advance of expenses ); provided , however , that if and to the extent that the DGCL requires, an advance of expenses incurred by an indemnitee in his or her capacity as a director or officer (and not in any capacity in which service was or is rendered by such indemnitee, including without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking (an undertaking ), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (a final adjudication ) that such indemnitee is not entitled to be indemnified for such expenses under this Section 1 of this Article VII or otherwise. The Corporation may also, by action of its Board of Directors, provide indemnification and advancement of expenses to employees and agents of the Corporation.
Section 2. Procedure for Indemnification . Any indemnification of an indemnitee or advance of expenses (including attorneys fees, costs and charges) under this ARTICLE VII shall be made promptly, and in any event within forty-five days (or, in the case of an advance of expenses, twenty days, provided that the indemnitee has delivered the undertaking contemplated by Section 1 of this ARTICLE VII if required), upon the written request of the indemnitee . If the Corporation denies a written request for indemnification or advance of expenses, in whole or in part, or if payment in full pursuant to such request is not made within forty-five days (or, in the case of an advance of expenses, twenty days, provided that the indemnitee has delivered the undertaking contemplated by Section 1 of this ARTICLE VII if required), the right to indemnification or advances as granted by this ARTICLE VII shall be enforceable by the indemnitee in any court of competent jurisdiction. Such persons costs and expenses incurred in connection with successfully establishing his or her right to indemnification and advancement of expenses, in whole or in part, in any such action shall also be indemnified by the Corporation, to the fullest extent permitted by applicable law. It shall be a defense to any such action (other than an action brought to enforce a claim for the advance of expenses where the undertaking required pursuant to Section 1 of this ARTICLE VII, if any, has been tendered to the Corporation) that the claimant has not met the standards of conduct which make it permissible under the DGCL for the Corporation to indemnify the claimant for the amount claimed, but the burden of such defense shall be on the Corporation to the fullest extent permitted by law. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that
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the claimant has not met the applicable standard of conduct. In any suit brought by the indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this ARTICLE VII or otherwise shall be on the Corporation. The procedure for indemnification of other employees and agents for whom indemnification and advancement of expenses is provided pursuant to Section 1 of this ARTICLE VII shall be the same procedure set forth in this Section 2 of this ARTICLE VII for an indemnitees, unless otherwise set forth in an action of the Board of Directors providing indemnification and advancement of expenses for such employee or agent.
Section 3. Insurance . The Corporation may purchase and maintain insurance on its own behalf and on behalf of any person who is or was or has agreed to become a director, officer, trustee, employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, partner, member, trustee, administrator, employee or agent of another corporation, partnership, joint venture, limited liability company, trust or other enterprise against any expense, liability or loss asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the Corporation would have the power to indemnify such person against such expenses, liability or loss under the DGCL.
Section 4. Service for Subsidiaries . Any person serving as a director, officer, partner, member, trustee, administrator, employee or agent of another corporation, partnership, joint venture, limited liability company, trust or other enterprise, at least 50% of whose equity interests are owned by the Corporation (a subsidiary for purposes of this ARTICLE VII) shall be conclusively presumed to be serving in such capacity at the request of the Corporation.
Section 5. Reliance . Persons who after the date of the adoption of this provision become or remain directors or officers of the Corporation or who, while a director or officer of the Corporation, become or remain a director, officer, employee or agent of a subsidiary, shall be conclusively presumed to have relied on the rights to indemnity, advance of expenses and other rights contained in this ARTICLE VII in entering into or continuing such service. The rights to indemnification and to the advance of expenses conferred in this ARTICLE VII shall apply to claims made against an indemnitee arising out of acts or omissions which occurred or occur both prior and subsequent to the adoption hereof. Any amendment, alteration or repeal of this ARTICLE VII that adversely affects any right of an indemnitee or its successors shall be prospective only and shall not limit, eliminate, or impair any such right with respect to any proceeding involving any occurrence or alleged occurrence of any action or omission to act that took place prior to such amendment or repeal.
Section 6. Non-Exclusivity of Rights; Continuation of Rights to Indemnification . The rights to indemnification and to the advance of expenses conferred in this ARTICLE VII shall not be exclusive of any other right which any person may have or hereafter acquire under the Certificate of Incorporation or under any statute, by-law, agreement, vote of stockholders or disinterested directors or otherwise. All rights to indemnification and advancement of expenses under this ARTICLE VII shall be deemed to be a contract between the Corporation and each indemnitee who serves or served in a capacity entitling such person to indemnification and
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advancement of expenses pursuant to this Article VII at any time while this ARTICLE VII is in effect. Any repeal or modification of this ARTICLE VII or repeal or modification of relevant provisions of the DGCL or any other applicable laws shall not in any way diminish any rights to indemnification and advancement of expenses of such indemnitee or the obligations of the Corporation arising hereunder with respect to any proceeding arising out of, or relating to, any actions, transactions or facts occurring prior to the final adoption of such repeal or modification.
Section 7. Merger or Consolidation . For purposes of this ARTICLE VII, references to the Corporation shall include, in addition to the resulting or surviving 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 and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or 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 or other enterprise, shall stand in the same position under this ARTICLE VII with respect to the resulting or surviving corporation as he or she would have with respect to such constituent corporation if its separate existence had continued.
Section 8. Savings Clause . If this ARTICLE VII or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Corporation shall nevertheless indemnify and advance expenses to each person entitled to indemnification under Section 1 of this ARTICLE VII as to all expense, liability and loss (including attorneys fees and related disbursements, judgments, fines, excise taxes, penalties and amounts paid or to be paid in settlement) actually and reasonably incurred or suffered by such person and for which indemnification and advancement of expenses is available to such person pursuant to this ARTICLE VII to the fullest extent permitted by any applicable portion of this ARTICLE VII that shall not have been invalidated and to the fullest extent permitted by applicable law.
ARTICLE VIII
AMENDMENTS
These Bylaws may be amended, altered, changed or repealed or new Bylaws adopted only in accordance with Section 1 of ARTICLE ELEVEN of the Certificate of Incorporation.
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Exhibit 5.1
November 13, 2017
SailPoint Technologies Holdings, Inc.
11305 Four Points Drive, Building 2, Suite 100
Austin, TX 78726
Re: Registration Statement on Form S-1
Ladies and Gentlemen:
We have acted as counsel for SailPoint Technologies Holdings, Inc., a Delaware corporation (the Company ), in connection with the proposed offer and sale (the Offering ) by the Company and certain selling stockholders thereof (the Selling Stockholders ), pursuant to a prospectus forming a part of a Registration Statement on Form S-1, Registration No. 333- 221036, originally filed by the Company with the Securities and Exchange Commission on October 20, 2017 (such Registration Statement, as amended at the effective date thereof, being referred to herein as the Registration Statement ), of up to 15,800,000 shares of common stock of the Company, par value $0.0001 per share, to be sold by the Company (the Company Shares ) and up to 7,200,000 shares of common stock of the Company, par value $0.0001 per share, to be sold by the Selling Stockholders (together with the Company Shares, the Shares ).
In connection with this opinion, we have assumed that (i) the Registration Statement, and any amendments thereto (including post-effective amendments), will have become effective, (ii) the Shares will be issued and sold in the manner described in the Registration Statement and the prospectus relating thereto and (iii) a definitive underwriting agreement, in the form to be filed as an exhibit to the Registration Statement, with respect to the sale of the Shares will have been duly authorized and validly executed and delivered by the Company and the other parties thereto.
In connection with the opinion expressed herein, we have examined, among other things, (i) the form of Third Amended and Restated Certificate of Incorporation of the Company and the form of Second Amended and Restated Bylaws of the Company to be filed as exhibits to the Registration Statement, (ii) the records of corporate proceedings that have occurred prior to the date hereof with respect to the Offering, (iii) the Registration Statement and (iv) the form of underwriting agreement to be filed as an exhibit to the Registration Statement. We have also reviewed such questions of law as we have deemed necessary or appropriate. As to matters of fact relevant to the opinion expressed herein, and as to factual matters arising in connection with our examination of corporate documents, records and other documents and writings, we relied upon certificates and other communications of corporate officers of the Company, without further investigation as to the facts set forth therein. In making such examination and rendering the opinion set forth below, we have assumed without verification the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to originals of all documents submitted to us as copies, and the legal capacity of all individuals executing any of the foregoing documents
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Based upon the foregoing, and subject to the qualifications and limitations stated herein, we are of the opinion that:
(a) | with respect to the Company Shares, when such Shares have been delivered in accordance with a definitive underwriting agreement approved by the Board of Directors of the Company and upon payment of the consideration provided for therein (not less than the par value of the Company Shares), the Company Shares will be validly issued, fully paid and nonassessable; and |
(b) | with respect to the Shares to be sold by the Selling Stockholders, such Shares are validly issued, fully paid and nonassessable. |
The foregoing opinions are limited in all respects to the General Corporation Law of the State of Delaware (including the applicable provisions of the Delaware Constitution and the reported judicial decisions interpreting these laws) and the federal laws of the United States of America, and we do not express any opinions as to the laws of any other jurisdiction.
The foregoing opinions are limited to the matters expressly stated herein, and no opinion is to be inferred or implied beyond the opinions expressly set forth herein. We undertake no, and hereby disclaim any, obligation to make any inquiry after the date hereof or to advise you of any changes in any matter set forth herein, whether based on a change in the law, a change in any fact relating to the Company or any other person or any other circumstance.
We hereby consent to the statements with respect to us under the heading Legal Matters in the prospectus forming a part of the Registration Statement and to the filing of this opinion as an exhibit to the Registration Statement. In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended.
Very truly yours,
/s/ Vinson & Elkins L.L.P.
Exhibit 10.4
FORM OF
SECOND AMENDMENT TO AMENDED AND
RESTATED CREDIT AND GUARANTY AGREEMENT
This SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT (this Agreement ) is made and entered into as of November [ ] , 2017, by and among SAILPOINT TECHNOLOGIES, INC. , a Delaware corporation, as Company, SAILPOINT TECHNOLOGIES INTERMEDIATE HOLDINGS, LLC , a Delaware limited liability company, as a Guarantor, the other Credit Parties party hereto, the Lenders party hereto and GOLDMAN SACHS BANK USA ( GSB ), as Administrative Agent (in such capacity, Administrative Agent ).
WHEREAS, Company, the other Credit Parties party thereto from time to time, the Lenders party thereto from time to time and GSB, as Administrative Agent, Collateral Agent and Lead Arranger, are party to that certain Amended and Restated Credit and Guaranty Agreement, dated as of November 2, 2016 (as amended by that certain First Amendment to Amended and Restated Credit and Guaranty Agreement, dated as of June 28, 2017, and as further amended, restated, supplemented or otherwise modified from time to time, the Credit Agreement ), whereby Lenders have extended to Company certain credit facilities pursuant to the Credit Agreement and the other Credit Documents;
WHEREAS, Company has requested that Administrative Agent and Lenders make certain amendments to the Credit Agreement; and
WHEREAS, Administrative Agent and the Lenders are willing to make such amendments subject to the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions . All capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Credit Agreement, after giving effect to this Agreement.
2. Amendments . Subject to the terms and conditions set forth herein, and in reliance on the representations, warranties, covenants and agreements contained in this Agreement:
(a) Section 1.1 of the Credit Agreement is hereby amended by deleting the defined terms Applicable Margin , Change of Control , Fee Letter and Subject Transaction in their entirety and inserting the following in lieu thereof in the proper alphabetical order:
Applicable Margin means (a) for any applicable periods prior to the First Amendment Effective Date, the Applicable Margin (as defined in this Agreement prior to the First Amendment Effective Date), (b) for the period beginning on the First Amendment Effective Date and ending on, but not including, the Second Amendment Effective Date, (i) seven percent (7.00%) for LIBOR Rate Loans and (i) six and one-half percent (6.50%) for Base Rate Loans and (c) for the period from and after the Second Amendment Effective Date, (i) four and one-half percent (4.50%) for LIBOR Rate Loans and (i) four percent (4.00%) for Base Rate Loans.
Change of Control means, at any time, (a) any Person or group (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) other than the Permitted Investors (I) shall have acquired beneficial ownership of twenty-five percent (25%) or more on a fully diluted basis of the, direct or indirect, voting and/or economic interest in the Capital Stock of Parent or Holdings or (II) shall have obtained the power (whether or not exercised) to elect a majority of the members of the board of directors (or similar governing body) of Parent or Holdings; (b) Holdings shall cease to beneficially own and control, directly or indirectly, 100% on a fully diluted basis of the economic and voting interest in the Capital Stock of Company; or (c) except pursuant to a transaction permitted by Section 6.9 , Company shall cease to beneficially own and control, directly or indirectly, 100% on a fully diluted basis of the economic and voting interests in the Capital Stock of its Subsidiaries.
Fee Letter means the second amended and restated letter agreement regarding certain fees and dated as of the Second Amendment Effective Date between Company and Administrative Agent.
Subject Transaction as defined in Section 6.8(f) .
(b) Section 1.1 of the Credit Agreement is hereby further amended by inserting the new defined terms Auditor , Qualified IPO and Second Amendment Effective Date in the proper alphabetical order as follows:
Auditor as defined in Section 5.1(c) .
Qualified IPO means an initial public offering by Parent of its Capital Stock pursuant to a registration statement filed with the Securities and Exchange Commission in accordance with the Securities Act and other applicable law, the total net cash proceeds received by Parent as a result of which are at least $100,000,000.
Second Amendment Effective Date means November [ ] , 2017.
(c) Section 1.1 of the Credit Agreement is hereby further amended by deleting each of the following terms: Fixed Charge Coverage Ratio and RNR .
(d) Section 1.1 of the Credit Agreement is hereby further amended by (i) deleting the brackets and words [intentionally reserved] in clause (a)(ix) of the definition of the term Consolidated Adjusted EBITDA and (ii) inserting in lieu thereof the following:
(ix) payments actually made to or on behalf of Holdings or Parent for (A) out-of-pocket legal, accounting, filing costs and other overhead expenses, in any case under this clause (A) , to the extent (I) actually incurred in the ordinary course of business and paid to non-Affiliates for the benefit of Company and its Subsidiaries or otherwise actually related to Holdings or Parents ownership of Company and its Subsidiaries, and (II) not exceeding $250,000 in the aggregate in any trailing twelve month period, and (B) director fees, expenses and indemnities actually incurred in the ordinary course of business and paid to directors of Holdings or Parent, to the extent not exceeding $350,000 in the aggregate in any trailing twelve month period;
(e) Section 2.13(i) of the Credit Agreement is hereby amended by deleting the existing text of such Section in its entirety and by inserting, in lieu thereof, the following text:
(i)
Receipt of IPO Proceeds
. On the date of receipt by Parent, any Credit Party or any of their
respective Subsidiaries of any net proceeds of an initial public offering of Parent, any such Credit Party or any of their respective Subsidiaries, including, for clarity, from a Qualified IPO, Company shall prepay the Loans and/or the Revolving
Commitments shall be permanently reduced as set forth in
Section
2.14(b)
in the amount equal to one hundred percent (100%) of such proceeds. Notwithstanding anything to the contrary set forth in the Credit Documents
(including, without limitation, the immediately preceding sentence and
Section
2.14(b)
), the Company shall prepay with the proceeds of the Qualified IPO the Loans and certain other Obligations on the Second Amendment
Effective Date, as follows:
first , the Company shall pay all fees and all expenses due and payable to the Agents as specified in Section 10.2 , to the full extent thereof; and
second , the Company shall pay (i) to each Lender holding a Term Loan (other than Goldman Sachs Bank USA) or any outstanding Revolving Loans (other than Goldman Sachs Bank USA), an amount equal to the sum of (A) 100% of the aggregate outstanding principal amount of, and accrued interest and any premium on, the Term Loan and the outstanding Revolving Loans held by each such Lender (without a corresponding reduction of any Revolving Commitments with respect thereto), and (B) any and all other Obligations due and payable to each such Lender and (ii) to Goldman Sachs Bank USA, solely in its capacity as a Lender holding a Term Loan, an amount equal to the sum of (A) the amount necessary to reduce the aggregate outstanding principal amount of its Term Loan to $70,000,000, (B) all accrued interest and any premium due and payable on the principal amount required to be prepaid pursuant to clause (ii)(A) and (C) all other Obligations due and payable as a result of such prepayment. For clarity, any remaining proceeds of the applicable Qualified IPO, after the payments referenced above are made, shall be retained by the Credit Parties.
(f) Section 5.1(b) of the Credit Agreement is hereby amended by deleting the existing text of such Section in its entirety and by inserting, in lieu thereof, the following text:
(b) Quarterly Financial Statements . (i) If Holdings is required to file a Form 10-Q under the Exchange Act, a copy of the Form 10-Q of Holdings, within 2 Business Days after the date on which Holdings files or is required to file its Form 10-Q under the Exchange Act (after giving effect to any extension pursuant to Rule 12b-25 under the Exchange Act (or any successor rule)) and, unless otherwise included in such Form 10-Q, comparative form figures for the preceding Fiscal Year or (ii) if Holdings is not required to file a Form 10-Q under the Exchange Act, within forty-five (45) days after the end of each Fiscal Quarter of each Fiscal Year (including the fourth Fiscal Quarter), the unaudited consolidated and consolidating balance sheets of Holdings and its Subsidiaries as at the end of such Fiscal Quarter and the related consolidated (and with respect to
statements of income, consolidating) statements of income, stockholders equity and cash flows of Holdings and its Subsidiaries for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter, setting forth in each case in comparative form the corresponding figures for the corresponding periods of the previous Fiscal Year and the corresponding figures from the Financial Plan for the current Fiscal Year, all in reasonable detail and in Microsoft Excel format, together with a Financial Officer Certification;
(g) Section 5.1(c) of the Credit Agreement is hereby amended by deleting the existing text of such Section in its entirety and by inserting, in lieu thereof, the following text:
(c) Annual Financial Statements . (i) If Holdings is required to file a Form 10-K under the Exchange Act, a copy of the Form 10-K of Holdings, within 2 Business Days after the date on which Holdings files or is required to file its Form 10-K under the Exchange Act (after giving effect to any extension pursuant to Rule 12b-25 under the Exchange Act (or any successor rule)) and, unless the audit report and opinion of an Auditor (as defined below) in such Form 10-K satisfies the requirements of clauses (b)(I) and (II) of Section 5.1(c)(ii) below, a report and opinion of an Auditor which satisfies such requirements or (ii) if Holdings is not required to file a Form 10-K under the Exchange Act, within one hundred twenty (120) days after the end of each Fiscal Year, (a) the consolidated and consolidating balance sheets of Holdings and its Subsidiaries as at the end of such Fiscal Year and the related consolidated (and with respect to statements of income, consolidating) statements of income, stockholders equity and cash flows of Holdings and its Subsidiaries for such Fiscal Year, setting forth in each case in comparative form the corresponding figures for the previous Fiscal Year and the corresponding figures from the Financial Plan for the Fiscal Year covered by such financial statements, in reasonable detail and in Microsoft Excel format, together with a Financial Officer Certification with respect thereto; and (b) with respect to such consolidated financial statements a report thereon of Grant Thornton LLP or other independent certified public accountants of recognized national standing selected by Holdings and reasonably satisfactory to Administrative Agent; it being agreed that any Big Four accounting firm shall be reasonably acceptable to the Administrative Agent (such auditor, the Auditor ), which report (I) shall be unqualified as to going concern and scope of audit (other than with respect to an upcoming maturity date of any Loan), and (II) shall state that such consolidated financial statements fairly present, in all material respects, the consolidated financial position of Holdings and its Subsidiaries as at the dates indicated and the results of their operations and their cash flows for the periods indicated in conformity with GAAP applied on a basis consistent with prior years (except as otherwise disclosed in such financial statements) and that the examination by such accountants in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards;
(h) Section 6.5 of the Credit Agreement is hereby amended by adding the following new clause (i) thereto (immediately following the end of clause (h) thereof):
; and (i) from and after the consummation of a Qualified IPO, the payment of any Restricted Junior Payment (including the consummation of any irrevocable redemption) within sixty (60) days after the date of the declaration of such Restricted Junior Payment (or the giving of the applicable redemption notice, as the case may be), as long as at the date of such declaration or notice, as the case may be, the Restricted Junior Payment would have been permitted under this Agreement.
(i) Section 6.8(b) of the Credit Agreement is hereby amended by deleting the existing text of such Section in its entirety and by inserting, in lieu thereof, the following text:
(b) Leverage Ratio Holdings shall not permit the Leverage Ratio as of the last day of any Fiscal Quarter, beginning with the first Fiscal Quarter ending after the Second Amendment Effective Date, to exceed the correlative ratio indicated:
Fiscal Quarter |
Leverage Ratio | |||
For each of such Fiscal Quarters ending on or before December 31, 2018 |
3.00:1.00 | |||
For each of the Fiscal Quarters ending thereafter |
2.50:1.00 |
(j) Sections 6.8(a) , 6.8(c) , 6.8(d) and 6.8(e) to the Credit Agreement are hereby deleted in their entirety and replaced, in each case, with [Intentionally Reserved].
(k) Section 6.8(f) of the Credit Agreement is hereby amended by deleting the existing text of such Section in its entirety and by inserting, in lieu thereof, the following text:
(f) Certain Calculations . With respect to any period during which a Permitted Acquisition or an Asset Sale has occurred (each, a Subject Transaction ), for purposes of determining compliance with the financial covenant set forth in this Section 6.8 , Consolidated Adjusted EBITDA (and, as applicable, Cash EBITDA) shall be calculated with respect to such period on a pro forma basis (including pro forma adjustments approved by Administrative Agent in its sole discretion) using the historical audited financial statements for the fiscal year then most recently ended of any business so acquired or to be acquired or sold or to be sold and the consolidated financial statements of Holdings and its Subsidiaries which shall be reformulated as if such Subject Transaction, and any Indebtedness incurred or repaid in connection therewith, had been consummated or incurred or repaid at the beginning of such period (and assuming that such Indebtedness bears interest during any portion of the applicable measurement period prior to the relevant acquisition at the weighted average of the interest rates applicable to outstanding Loans incurred during such period).
3. Delivery . On the date hereof, the Company shall deliver to the Administrative Agent a revised Schedule 4.2 reflecting the capital structure of the Company and Holdings after giving effect to the Qualified IPO.
4. Consent; Assignment . For the avoidance of doubt, each Lender hereby consents to the order and manner (including, without limitation, the non-pro rata application of payments) in which the Loans and other Obligations will be paid on the Second Amendment Effective Date as a result of the consummation by Parent of a Qualified IPO as set forth in the second sentence of Section 2.13(i) of the Credit Agreement (as amended hereby). In addition, each Lender (other than Goldman Sachs Bank USA) with a Revolving Commitment agrees that, on and as of the Second Amendment Effective Date, after receipt of the amounts owing to such Lender under Section 2.13(i) (including payment in full of all Term Loans and Revolving Loans owing to such Lender as of such date), such Lender shall execute an Assignment Agreement in accordance with Section 10.6 of the Credit Agreement in favor of Goldman Sachs Bank USA transferring such Lenders Revolving Commitment as of such date to Goldman Sachs Bank USA. Each Lender further agrees that the provisions of this Section 4 shall be binding on any successor or assignee to such Lender.
5. Acknowledgements and Agreements . The Credit Parties, as a material inducement to Administrative Agent and the Lenders to enter into this Agreement, hereby reaffirm and ratify the Credit Documents. This Agreement is not intended, and shall not be construed as an amendment of, or any kind of extension, consent or waiver related to any transaction under, the Credit Agreement or any other Credit Document, other than as expressly set forth herein in accordance with the express terms hereof, and Agents, Lenders and Issuing Bank accordingly reserve all of their respective rights under the Credit Agreement and the other Credit Documents. Administrative Agents and Lenders making the amendments contained herein does not and shall not create (nor shall Company or any other Credit Party rely on the existence of or claim or assert that there exists) any obligation of any Agent, Lender or Issuing Bank to consider or agree to any further waivers, consents or amendments and, in the event that Agents, Lenders or Issuing Bank subsequently agree to consider any further waivers, consents or amendments, neither this Agreement nor any other conduct of any Agent, Lender or Issuing Bank shall be of any force or effect on any Agents, Lenders or Issuing Banks consideration or decision with respect thereto, and Agents, Lenders and Issuing Bank shall have no obligation whatsoever to consider or agree to any further waivers, consents or amendments.
6. Representations, Warranties, Covenants and Acknowledgments . To induce Administrative Agent and the Lenders to enter into this Agreement, each Credit Party does hereby:
(a) represent and warrant to Administrative Agent and the Lenders that (i) as of the date hereof, after giving effect to this Agreement, all of the representations and warranties made or deemed to be made under the Credit Documents are true and correct in all material respects, except to the extent that such representations and warranties specifically relate to an earlier date (in which case, such representations and warranties shall have been true and correct in all material respects as of such earlier date); (ii) as of the date hereof, there exists no Default or Event of Default under the Credit Agreement or any other Credit Document or would result from this Agreement becoming effective in accordance with its terms; (iii) each Credit Party has the power and is duly authorized to execute, deliver and perform this Agreement and perform under the Credit Agreement as amended by this Agreement; and (iv) each of this Agreement and the Credit Agreement, as amended by this Agreement, is the legal, valid and binding obligation of such Credit Party enforceable against such Credit Party in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors rights generally or by equitable principles relating to enforceability; and
(b) reaffirm each of the agreements, covenants, indemnities and undertakings of such Credit Party set forth in the Credit Agreement and each other Credit Document to which it is a party and executed in connection therewith or pursuant thereto as if such Credit Party were making such agreements, covenants, indemnities and undertakings on the Second Amendment Effective Date; and
(c) acknowledge and agree that no right of offset, defense, counterclaim, claim, cause of action or objection in favor of such Credit Party against any Agent, Issuing Bank or any Lender exists arising out of or with respect to (i) this Agreement, the Credit Agreement or any other Credit Document to which it is a party, or (ii) any other documents to which it is a party now or heretofore evidencing, securing or in any way relating to the foregoing; and
(d) acknowledge and agree that this Agreement shall be deemed a Credit Document for all purposes under the Credit Agreement; and
(e) neither this Agreement nor any document executed in connection hereof shall be deemed to constitute a refinancing, substitution or novation of the Credit Agreement, any Credit Document, the Obligations or any other obligations and liabilities thereunder.
7. Conditions Precedent to this Agreement . The effectiveness of this Agreement is subject to the following conditions precedent:
(a) Documents . Administrative Agent and the Lenders shall have received executed counterparts of the following, in each case, in form and substance reasonably satisfactory to Administrative Agent and the Lenders: (i) this Agreement; (ii) an Acknowledgement and Consent from Thoma Bravo, LLC, in the form attached hereto, (iii) the Fee Letter (as defined after giving effect to this Agreement), (iv) the Schedule required to be delivered under Section 3 above and (v) the Assignment Agreements from each applicable Lender, as set forth under Section 4 above (which, for clarity, may be delivered in escrow by such Lenders subject to receipt of the applicable payments under clause (c) below).
(b) Expenses . Company shall pay Administrative Agent and the Lenders all of their reasonable and documented out of pocket costs and expenses in connection with this Agreement in accordance with the Credit Agreement (including, without limitation, all reasonable and documented out of pocket fees, expenses and disbursements of outside counsel to Administrative Agent and the Lenders).
(c) Payoff .
(i) Each Lender (other than Goldman Sachs Bank USA) shall have received in cash the full amount of Obligations (including, without limitation, principal, interest, the Second Amendment Prepayment Premium (as defined in the Fee Letter (as defined after giving effect to this Agreement)), fees, expenses and other Obligations (other than un-asserted contingent indemnification obligations) owing to such Lender as of the Second Amendment Effective Date), as set forth in a written notice to Company delivered to Company one (1) Business Day prior to the Second Amendment Effective Date; and
(ii) Goldman Sachs Bank USA shall have received in cash the amount of Obligations (including, without limitation, principal, interest, the Second Amendment Prepayment Premium (as defined in the Fee Letter (as defined after giving effect to this Agreement)), fees, expenses and other Obligations) owing to Goldman Sachs Bank USA under the second sentence of Section 2.13(i) of the Credit Agreement on the Second Amendment Effective Date.
8. Effect; Relationship of Parties . Except as expressly modified hereby, the Credit Agreement and each other Credit Document shall be and remain in full force and effect, and shall constitute the legal, valid, binding and enforceable obligations of each Credit Party to Agents, Issuing Bank and Lenders, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors rights generally or by equitable principles relating to enforceability. The relationship of Agents, Issuing Bank and Lenders, on the one hand, and each Credit Party, on the other hand, has been and shall continue to be, at all times, that of creditor and debtor and not as joint venturers or partners. Nothing contained in this Agreement (or any instrument, document or agreement delivered in connection herewith), the Credit Agreement or any other Credit Document shall be deemed or construed to create a fiduciary relationship between or among the parties.
9. Release . In further consideration of Administrative Agents and Lenders execution of this Agreement, each Credit Party, individually and on behalf of its successors (including, without limitation, any trustees acting on behalf of such Credit Party and any debtor-in-possession with respect to such Credit Party), assigns, subsidiaries and Affiliates (collectively, the Releasors ), hereby forever releases each Agent, each Issuing Bank and each Lender and their respective successors, assigns, parents, subsidiaries, Affiliates, officers, employees, directors, agents and attorneys (collectively, the Releasees ) from any and all debts, claims, demands, liabilities, responsibilities, disputes, causes, damages, actions and causes of actions (whether at law or in equity) and obligations of every nature whatsoever, whether liquidated or unliquidated, whether known or unknown, whether matured or unmatured, whether fixed or contingent that such Releasor has or may have against the Releasees, or any of them, which arise from or relate to any actions which the Releasees, or any of them, have or may have taken or omitted to take in connection with the Credit Agreement or the other Credit Documents prior to the date hereof (including, without limitation, with respect to the Obligations, any Collateral, the Credit Agreement, any other Credit Document) and any third parties liable in whole or in part for the Obligations. This provision shall survive and continue in full force and effect whether or not each Credit Party shall satisfy all other provisions of this Agreement or the other Credit Documents, including payment in full of all Obligations. Each Releasor understands, acknowledges and agrees that the foregoing release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release. Each Credit Party hereby agrees to indemnify and hold the Releasees, or any of them, harmless with respect to any and all liabilities, obligations, losses, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever incurred by the Releasees, or any of them, whether direct, indirect or consequential, as a result of, arising from or relating to any proceeding by or on behalf of any Person, including, without limitation, officers, directors, agents, trustees, creditors, partners or shareholders of any Credit Party or any parent, subsidiary or Affiliate of any Credit Party, whether threatened or
initiated, asserting any claim for legal or equitable remedy under any statutes, regulation, common law principle or otherwise arising from or in connection with any matter which is the subject of the release set forth in this Section 9 . The foregoing indemnity shall survive the payment in full of the Obligations and the termination of this Agreement and the other Credit Documents.
10. Miscellaneous . This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts (any of which may be delivered via facsimile or electronic mail in portable document format), each of which, when so executed and delivered, shall be deemed to be an original and all of which counterparts, when taken together, shall constitute one and the same Agreement. The exchange of copies of this Agreement and of signature pages hereto (and of the other documents required to be delivered hereunder) by facsimile or electronic mail in portable document format shall constitute effective execution and delivery of this Agreement (and such other documents) and may be used in lieu of the original Agreement (or in lieu of the original of such other documents) for all purposes. Signatures of the parties transmitted by facsimile or electronic mail in portable document format shall be deemed to be the parties original signatures for all purposes. This Agreement shall be binding upon and inure to the benefit of the successors and permitted assigns of the parties hereto. This Agreement shall be governed by, and construed and enforced according to, the laws of the State of New York without regard to conflict of law principles (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law) thereof. Each of the parties hereto accepts the non-exclusive jurisdiction of any state or federal court of competent jurisdiction in the State, County and City of New York for any judicial proceeding arising under or relating to this Agreement, to the full extent set forth in Section 10.15 of the Credit Agreement. Each of the parties hereto hereby agrees to waive its respective rights to a jury trial of any claim or cause of action based upon or arising under this Agreement, to the full extent set forth in Section 10.16 of the Credit Agreement. This Agreement embodies the entire agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes all prior oral or written negotiations, agreements and understandings of the parties with respect to the subject matter hereof.
[Remainder of Page Intentionally Blank]
IN WITNESS WHEREOF , the Credit Parties, Administrative Agent and the Lenders have caused this Agreement to be duly executed by their respective duly authorized representatives as of the date first set forth above.
SAILPOINT TECHNOLOGIES INC. , as Company |
By: |
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Name: | ||
Title: |
SAILPOINT TECHNOLOGIES INTERMEDIATE HOLDINGS, LLC , as a Guarantor |
By: |
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Name: | ||
Title: |
SAILPOINT INTERNATIONAL, INC. , as a Guarantor |
By: |
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Name: | ||
Title: |
GOLDMAN SACHS BANK USA , |
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as Administrative Agent, a Lender and Issuing Bank |
By: |
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Name: | ||
Title: |
TPG SPECIALTY LENDING, INC. , |
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as a Lender |
By: |
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Name: | ||
Title: |
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges and consents to the foregoing Second Amendment to Amended and Restated Credit and Guaranty Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Acknowledgement and Consent as of this day of November, 2017.
THOMA BRAVO, LLC, as Subordinated Lender |
By: |
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Name: | ||
Title |
Exhibit 10.11
AMENDED AND RESTATED
SENIOR MANAGEMENT AND RESTRICTED STOCK AGREEMENT
(Kevin Cunningham)
THIS AMENDED AND RESTATED SENIOR MANAGEMENT AND RESTRICTED STOCK AGREEMENT (this Agreement ) is dated as of November 5, 2017 by and among SailPoint Technologies Holdings, Inc., a Delaware corporation (the Parent ), SailPoint Technologies, Inc., a Delaware corporation (the Company ), and Kevin Cunningham, an individual (the Employee ). This Agreement amends and restates that certain Senior Management and Restricted Stock Agreement by and among the Parent, the Company and the Employee dated September 8, 2014 (the Original Agreement ). September 8, 2014, the effective date of the Original Agreement, is referred to herein as the Effective Date . This Agreement is being entered into in anticipation of the Parents initial public offering of common stock. This Agreement shall become effective on the business day immediately preceding (but conditioned on) the closing of the Parents initial public offering of common stock (the Amendment Effective Date ), and the Original Agreement shall remain in full force and effect until the Amendment Effective Date. In the event that the closing of the Parents initial public offering of common stock does not occur for any reason prior to October 1, 2018, this Agreement shall be null and void and the Original Agreement will remain in full force and effect pursuant to its original terms.
Recitals
A. The Parent and Employee previously entered into the Original Agreement pursuant to which Employee purchased, and the Parent sold, subject to certain vesting and other restrictions as set forth herein, 1,075,000 shares of the common stock, par value $0.001 per share, of the Parent (the Common Stock ). All such shares of Common Stock are referred to herein as Employee Stock . For clarity, the 1,456,443.4932 shares of Common Stock and the 7,456 shares of preferred stock, par value $0.001 per share, of the Parent acquired by the Employee (and his affiliate) pursuant that certain Agreement and Plan of Merger, dated as of August 10, 2014, by and among Parent, Project Spyglass Merger Sub, Inc. and Company Fortis Advisors LLC shall not be considered Employee Stock for purposes of this Agreement.
B. Certain definitions are set forth in Section 10 of this Agreement.
Agreement
In consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement agree as follows:
PROVISIONS RELATING TO THE EXECUTIVE STOCK
1. Purchase and Sale of Employee Stock .
(a) On the Effective Date, the Parent (i) established an equity incentive pool (the Incentive Equity Pool ), and (ii) granted Employee a number of shares of Common Stock equal to approximately 14.333% of the Equity Incentive Pool (the Effective Date, which is the
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date upon which such shares of Common Stock were granted, is referred to herein as the Grant Date ). On the Grant Date, Employee purchased, and the Parent sold, such 1,075,000 shares of Common Stock at a price per share of $0.0517 per share, of which (A) 50% of such shares of Common Stock are referred to herein as Time-Vested Shares and (B) 50% of such shares of Common Stock are referred to herein as Annual-Vested Shares .
(b) Within 30 days after the Grant Date, Employee made an election with the Internal Revenue Service under Section 83(b) of the Internal Revenue Code and the regulations promulgated thereunder.
(c) In connection with the purchase and sale of the Employee Stock hereunder, Employee represented, warranted and covenanted and hereby represents, warrants and covenants to the Parent and the Company that:
(i) The Employee Stock acquired by Employee pursuant to the Original Agreement was acquired for Employees own account and not with a view to, or intention of, distribution thereof in violation of the Securities Act, or any applicable state securities laws, and the Employee Stock will not be disposed of in contravention of the Securities Act or any applicable state securities laws.
(ii) Employee is both an accredited investor (as defined in the rules under the Securities Act), is sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Employee Stock.
(iii) Employee is able to bear the economic risk of his investment in the Employee Stock for an indefinite period of time because the Employee Stock has not been registered under the Securities Act and, therefore, cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available.
(iv) Employee has had an opportunity to ask questions and receive answers concerning the terms and conditions of the offering of Employee Stock and has had full access to such other information concerning the Parent as he has requested and has had the opportunity to consult with his own independent counsel regarding his investment in Employee Stock.
(v) This Agreement and each of the other agreements contemplated hereby constitute the legal, valid and binding obligation of Employee, enforceable in accordance with their respective terms, and the execution, delivery and performance of this Agreement and such other agreements by Employee does not and will not conflict with, violate or cause a breach of any agreement, contract or instrument to which Employee is a party or any statute, rule, judgment, order or decree to which Employee is subject.
(vi) Employee is a resident of the State of Texas.
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(d) As an inducement to the Parent to issue the Employee Stock to Employee, and as a condition thereto, Employee acknowledged and agreed and hereby acknowledges and agrees that neither the issuance of the Employee Stock to Employee nor any provision contained herein shall entitle Employee to remain in the employment of the Parent and its Subsidiaries or affect the right of the Company to terminate Employees employment at any time for any reason.
2. Vesting of Certain Employee Stock .
(a) Time-Vested Shares and Annual-Vested Shares are subject to vesting as further described in this Section 2 based upon Employees continued employment with the Company.
(b) Except as otherwise provided in Section 2(d) below, the Time-Vested Shares will continue to become vested in accordance with the following schedule, if as of each such date Employee remains continuously employed by the Parent or any of its Subsidiaries: (i) 25% of the Time-Vested Shares became vested on the first anniversary of the Effective Date and (ii) the remaining Time-Vested Shares have or will become vested in equal installments on a monthly basis over the 36-month period following such first anniversary of the Effective Date.
(c) Except as otherwise provided in Section 2(d) below, the Annual-Vested Shares will continue to become vested in accordance with the following schedule if as of each such date Employee remains continuously employed by the Parent or any of its Subsidiaries:
(i) twenty-five percent (25%) of the Annual-Vested Shares became vested on January 15, 2016 (the First Annual Vest Date );
(ii) an additional twenty-five percent (25%) of the Annual Vested Shares have or will become vested on each of the first and second anniversaries of the First Annual Vest Date; and
(iii) any remaining Annual-Vested Shares will become vested on the third anniversary of the First Annual Vest Date.
(d) Upon the occurrence of a Liquidity Event, 100% of the Unvested Employee Stock shall become vested immediately prior to such Liquidity Event; provided , however , that if Employee ceases to be continuously employed by the Parent or its Subsidiaries until immediately prior to such Liquidity Event, then no Unvested Employee Stock shall vest in accordance with this Section 2(d) .
(e) All shares of Employee Stock which become vested in accordance with this Section 2 are referred to herein as Vested Shares , and all other shares of Employee Stock are referred to herein as Unvested Shares .
(f) Notwithstanding the provisions of this Section 2 , this Agreement shall not result in fewer shares of Employee Stock being Vested Shares hereunder on the Amendment Effective Date than the number of shares of Employee Stock that were Vested Shares under the Original Agreement as of immediately prior to the Amendment Effective Date and shares of Employee Stock that have become Vested Shares as of the Amendment Effective Date shall remain Vested Shares under this Agreement.
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3. Repurchase Options .
(a) In the event Employee ceases to be employed by the Company and its Subsidiaries for any reason (a Termination ), all of the Unvested Shares will be subject to repurchase by the Parent pursuant to the terms and conditions set forth in this Section 3 (the Repurchase Option ).
(b) The purchase price for each Unvested Share will be Employees Original Cost for such share.
(c) The board of directors of the Parent (the Board ) may elect to cause the Parent to purchase all or any portion of any of the Unvested Shares by delivering written notice (the Repurchase Notice ) to the Employee within 90 days after the Termination for any Unvested Shares. The Repurchase Notice will set forth the number of Unvested Shares to be acquired, the aggregate consideration to be paid for such shares and the time and place for the closing of the transaction. Additionally, the Board may cause the Parent to assign its rights under this Section 3 to one or more of its Affiliates.
(d) The closing of the purchase of the Unvested Shares pursuant to the Repurchase Option shall take place on the date designated by the Parent in the Repurchase Notice, which date shall not be more than 30 days nor less than five days after the delivery of such notice. The Parent will pay for the Unvested Shares to be purchased by it pursuant to the Repurchase Option by first offsetting amounts outstanding under any bona fide debts for money borrowed from the Parent or for travel and expense advances owed by Employee to the Parent; upon full repayment of such bona fide debts, the Parent will make payment by a check or wire transfer of funds in the aggregate amount of the remaining purchase price for such Unvested Shares. The Parent will be entitled to receive customary representations and warranties from the sellers regarding such sale and to require all sellers signatures be guaranteed.
(e) Notwithstanding anything to the contrary contained in this Agreement, all repurchases of Unvested Shares by the Parent shall be subject to applicable restrictions contained in the Delaware General Corporation Law and in the Parents and its Subsidiaries debt and equity financing agreements.
4. Restrictions on Transfer of Employee Stock .
(a) The Unvested Shares are restricted in that they may not be sold, transferred or otherwise alienated or hypothecated until they become Vested Shares as described in Section 2 of this Agreement. The Unvested Shares are also restricted in the sense that they may be subject to the Repurchase Option.
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(b) The certificates representing the Employee Stock will bear a legend in substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH IN A CERTAIN AMENDED AND RESTATED SENIOR MANAGEMENT AND RESTRICTED STOCK AGREEMENT BETWEEN THE COMPANY AND AN EXECUTIVE OF THE COMPANY DATED AS OF NOVEMBER 5, 2017. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE COMPANYS PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
PROVISIONS RELATING TO EMPLOYMENT
5. Employment . The Company agrees to employ Employee and Employee accepts such employment for the period beginning as of the Effective Date and ending upon the effective date of Employees Termination pursuant to Section 5(f) hereof (the Employment Period ).
(a) As of the date of this Agreement, during the Employment Period, Employee shall serve as Chief Strategy Officer of the Company and shall have such duties and responsibilities as are typically commensurate with such position. Employee shall have such other powers and perform such other duties as may from time to time reasonably be prescribed by the Board which are consistent with the position of Chief Strategy Officer. Employees authority shall be subject to the power of the Board to expand such duties, responsibilities and authority, subject to Employees acceptance of any such expansion, and to override actions of Employee.
(b) Employee shall report to the Board, and Employee shall devote appropriate time and attention to the business and affairs of the Company and its Subsidiaries.
(c) During the Employment Period, Employees base salary shall be $310,000 per annum (as in effect from time to time, the Base Salary ). Employees Base Salary shall be payable in regular installments in accordance with the Companys general payroll practices and shall be subject to customary withholding for income tax, social security, and other applicable taxes. Employees Base Salary for any partial year will be prorated based upon the number of days elapsed in such year.
(d) Bonuses .
(i) In addition to the Base Salary, the Employee shall be entitled to an award of an annual performance bonus (the Bonus ) following the end of each fiscal year during the Employment Period commencing with the fiscal year ending December 31, 2015, based upon the Companys achievement of budgetary and other objectives, including specific objectives relating to Employees contributions, set by the Board in consultation with Employee no later than March 31 of the applicable bonus year.
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(ii) Except where otherwise provided, the Bonus for any fiscal year will be payable to the Employee in cash promptly upon completion of the Companys audited financial statements for such fiscal year, but in any event within 120 days following the end of such fiscal year.
(e) Benefits . In addition to the Base Salary and any Bonuses payable to Employee pursuant to this Agreement, Employee shall be entitled to the following benefits during the Employment Period:
(i) reimbursement for reasonable business expenses incurred by Employee on the Companys behalf and within the Companys stated policies and procedures for expense reimbursement, subject to providing appropriate documentation thereof to the Company;
(ii) participation in all health, disability and welfare plans available to the Companys senior executives;
(iii) participation in all life insurance plans available to the Companys senior executives;
(iv) participation in all retirement plans available to the Companys senior executives; and
(v) participation in any paid-time-off policies available to the Companys senior executives.
(f) Termination .
(i) The Employment Period shall continue until Employees resignation, death, Permanent Disability (as such term is defined in Section 0 ) or until the Board determines in its good faith judgment that termination of Employees employment ( Termination ) is in the best interests of the Company.
(ii) If the Employment Period is terminated by the Company with Cause or by Employee without Good Reason, Employee shall be entitled to receive Employees Base Salary (as in effect at time of Termination) through the effective date of Employees Termination but shall not be entitled to any Bonus for such current fiscal year, provided , however , that Employee will receive his earned but unpaid bonus, if any, for the prior fiscal year.
(iii) If the Employment Period is terminated due to death or Permanent Disability, Employee shall be entitled to receive Employees Base Salary for the period through the date of death or the date when the Employment Period is terminated as a result of Permanent Disability. In addition, Employee will be entitled to Employees vested rights under any benefit plans (including any disability plans, 401(k) plans or other retirement plans).
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(iv) If at any time the Employment Period is terminated by the Company without Cause or by Employee for Good Reason, Employee shall be entitled to receive the following (collectively, the Severance Benefits ): (A) Employees Base Salary through the date that is twelve (12) months after the effective date of such Termination, payable in equal installments on the Companys regular salary payment dates commencing on the first payroll date that is sixty (60) days from the date of such termination (with the first payment including amounts otherwise payable during such 60-day period (the First Payment Date )); (B) a lump-sum payment equal to Employees annual target bonus, payable on the First Payment Date ( provided , that the payment contemplated by this clause (B) shall only be payable if Employee would have achieved his financial objectives for the fiscal year his termination of employment occurs, based on the pro-rata results actually achieved by Employee prior to the date of his termination as compared to the pro-rata objectives established for Employees target bonus for the then-current fiscal year); (C) twelve (12) months of COBRA payments, provided that the Company shall not be obligated to pay any COBRA payments to Employee to the extent Employee elects not to receive COBRA coverage from the Company; and (D) a portion of any remaining unvested Time-Vested Shares equal to the amount of Time-Vested Shares and Annual-Vested Shares that would have vested over the 12-month period immediately following the date the Employment Period shall become vested. Any of the Severance Benefits contemplated by this Section 5 shall be conditioned upon Employees execution and delivery to the Company of a general release in form and substance satisfactory to the Company and Employee (the Release ), which Release shall become effective and irrevocable within 60 days of the termination date and upon Employees compliance with the terms of Sections 6 and 7 below, and upon any breach by Employee of the provisions of Sections 6 and 7 below, the Companys obligation to make any Severance Benefits shall immediately terminate.
(v) Anything provided herein to the contrary notwithstanding, nothing in this Agreement shall confer upon the Employee any right to continue in the service of the Company (or any Company or Subsidiary of the Company employing or retaining Employee) for any period of time or interfere with or restrict in any way the rights of the Company (or any Company or Subsidiary of the Company employing or retaining Employee) or the Employee, which rights are hereby expressly reserved by each, to terminate the employee status of Employee at any time for any reason whatsoever or for no reason with or without cause.
(g) No Investor Obligation . For the avoidance of doubt, notwithstanding the rights, if any, granted to TB hereunder, in no case shall TB be responsible for any obligation of the Company pursuant to this Section 5 , and Employee hereby covenants for the benefit of TB that he will not make any assertions to the contrary.
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6. Affirmation of Continuing Covenants . Employee expressly acknowledges that Employees obligations pursuant to that certain Employment, Proprietary Information, and Inventions Assignment Agreement (the EPIIAA ) entered into by and between Employee and the Company dated December 1, 2005 continue to be in full force and effect and covenants and agrees to abide by the terms set forth therein.
7. Restrictive Covenants .
(a) Noncompetition . In further consideration of the opportunity to purchase the Employee Stock hereunder, Employee acknowledges that during the course of his employment with the Company and its Affiliates (including, without limitation, any predecessors thereof) he has become familiar with, and during the course of his employment with the Company and its Subsidiaries he will become familiar with, the Companys and its Subsidiaries trade secrets and with other Confidential Information. Employee acknowledges that his services shall be of special, unique and extraordinary value to the Company and its Subsidiaries and that the Companys ability to accomplish its purposes and to successfully pursue its business plan and compete in the marketplace depend substantially on the skills and expertise of the Employee. Therefore, and in further consideration of the opportunity to purchase the Employee Stock hereunder, Employee agrees that, during the Employees period of employment with the Company or any of its Subsidiaries and for 18 months thereafter, he shall not directly or indirectly engage or become interested in (whether as an owner, partner, director, officer, employee, consultant, stockholder or otherwise) any business that provides, offers or is otherwise directly or indirectly engaged in providing or offering (including through acquiring companies which provide or offer) products or services anywhere in the world that are competitive with the Business. For purposes of this Agreement, Business shall mean the business of providing on-premises and hosted (i.e., SaaS-based) identity and access management solutions to enterprise and government customers, including data and risk management, compliance and provisioning solutions and services.
(b) Nonsolicitation . In addition, during the Employees period of employment with the Company or any of its Subsidiaries and for 18 months thereafter, Employee shall not (and shall cause all of his Affiliates not to) directly or indirectly through another entity or person (i) induce or attempt to induce any employee of the Parent or any of its Subsidiaries (including the Company) to leave the employ of the Parent or any of its Subsidiaries (including the Company), or in any way interfere with the relationship between the Parent or any of its Subsidiaries (including the Company) and any employee thereof, (ii) hire (in any capacity) any person who was an employee of the Parent or any of its Subsidiaries (including the Company) at any time during the one (1) year period immediately prior to the date on which such hiring would take place (it being conclusively presumed by the parties so as to avoid any disputes under this Section 7(b) that any such hiring within such one (1) year period is in violation of Section 7(a) above), (iii) for so long as Employee has any obligations under Section 7(a) above, call on, solicit or service any customer, supplier, licensee, licensor or other business relation of the Parent or any of its Subsidiaries (including the Company) in order to induce or attempt to induce such Person to cease doing business with the Parent or any of its Subsidiaries (including the Company), or in any way interfere with the relationship between any such customer, supplier, licensee or business relation and the Parent or any of its Subsidiaries (including the Company), including making any negative statements or communications about
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the Parent or any of its Subsidiaries (including the Company) or (iv) initiate or engage in any discussions regarding an acquisition of, or Employees employment (whether as an employee, an independent contractor or otherwise) by, any businesses with which the Parent or any of its Subsidiaries (including the Company) has entertained discussions or has requested and received information relating to the acquisition of such business by the Parent or any of its Subsidiaries (including the Company) prior to the termination of the Employees employment with the Company.
(c) Enforcement . If, at the time of enforcement of this Section 7 , a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration, scope or geographical area reasonable under such circumstances shall be substituted for the stated duration, scope or area and that the court shall be allowed to revise the restrictions contained herein to cover the maximum duration, scope and area permitted by law. Because Employees services are unique and because Employee has access to Confidential Information, the parties hereto agree that money damages would not be an adequate remedy for any breach of this Agreement. Therefore, in the event a breach or threatened breach of this Agreement, the Company or its successors or assigns may, in addition to other rights and remedies existing in their favor, apply to any court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof (without posting a bond or other security and without proving damages).
8. Section 409A .
(a) Anything in this Agreement to the contrary notwithstanding, if at the time of the Employees separation from service within the meaning of Section 409A of the Code, the Company determines that the Employee is a specified employee within the meaning of Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that the Employee becomes entitled to under this Agreement on account of the Employees separation from service would be considered deferred compensation subject to the 20 percent additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and such benefit shall not be provided until the date that is the earlier of (i) six months and one day after the Employees separation from service, or (ii) the Employees death. If any such delayed cash payment is otherwise payable on an installment basis, the first payment shall include a catch-up payment covering amounts that would otherwise have been paid during the six-month period but for the application of this provision, and the balance of the installments shall be payable in accordance with their original schedule.
(b) All in-kind benefits provided and expenses eligible for reimbursement under this Agreement shall be provided by the Company or incurred by the Employee during the time periods set forth in this Agreement. All reimbursements shall be paid as soon as administratively practicable, but in no event shall any reimbursement be paid after the last day of the taxable year following the taxable year in which the expense was incurred. The amount of in-kind benefits provided or reimbursable expenses incurred in one taxable year shall not affect the in-kind benefits to be provided or the expenses eligible for reimbursement in any other taxable year. Such right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.
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(c) To the extent that any payment or benefit described in this Agreement constitutes non-qualified deferred compensation under Section 409A of the Code, and to the extent that such payment or benefit is payable upon the Employees termination of employment, then such payments or benefits shall be payable only upon the Employees separation from service. The determination of whether and when a separation from service has occurred shall be made in accordance with the presumptions set forth in Treasury Regulation Section 1.409A-1(h).
(d) The parties intend that this Agreement will be administered in accordance with Section 409A of the Code. To the extent that any provision of this Agreement is ambiguous as to its compliance with Section 409A of the Code, the provision shall be read in such a manner so that all payments hereunder comply with Section 409A of the Code. The parties agree that this Agreement may be amended, as reasonably requested by either party, and as may be necessary to fully comply with Section 409A of the Code and all related rules and regulations in order to preserve the payments and benefits provided hereunder without additional cost to either party.
(e) The Company makes no representation or warranty and shall have no liability to the Employee or any other person if any provisions of this Agreement are determined to constitute deferred compensation subject to Section 409A of the Code but do not satisfy an exemption from, or the conditions of, such Section.
GENERAL PROVISIONS
9. Withholding . The Parent or the Company may withhold from any and all amounts payable under this Agreement or otherwise such federal, state, local or foreign withholding taxes, excise taxes, or employment taxes ( Taxes ) as may be required to be withheld pursuant to any applicable law or regulation. Employee shall pay to the Parent or the Company or make arrangements satisfactory to the Parent to pay the amount of all applicable Taxes that the Parent or the Company is required to withhold at any time. If Employee shall fail to make such payment, the Parent or the Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to Employee any Taxes of any kind required by law to be withheld with respect to the Employee Stock. Employee acknowledges that it is Employees sole responsibility, and not the Parents or the Companys, to file timely and properly the election under Section 83(b) of the Internal Revenue Code and any corresponding provisions of state tax laws. In the event that the Parent or the Company fails to withhold any Taxes required to be withheld by applicable law or regulation, Employee shall indemnify the Parent and its Subsidiaries (including the Company) for any amounts paid by the Parent or the Company with respect to any such Taxes but only to the extent Employee has not already paid such Taxes; provided , however , that Employee shall not be required to indemnify the Parent or the Company for any interest, penalties and related expenses thereto.
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10. Definitions .
Affiliate means, as to any Person, any other Person, which directly or indirectly controls, or is under common control with, or is controlled by, such Person. As used in this definition, control (including, with its correlative meanings, controlled by and under common control with) shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise).
Cause means a vote of the Board resolving that Employee should be dismissed as a result of (a) Employees conviction of a felony; (b) Employee engaging in any other act of fraud, intentional misrepresentation, moral turpitude, misappropriation or embezzlement, illegality or unlawful harassment which, as determined by the Board in good faith and in light of all available facts, would: (i) materially adversely affect the business or the reputation of the Company with its current or prospective customers, suppliers, lenders and/or other third parties with whom the Company does or might do business; or (ii) expose the Company to a risk of material civil or criminal legal damages, liabilities or penalties; (c) the repeated willful failure by Employee to follow the reasonable directives of the Board in connection with the business affairs of the Company; (d) any material breach by Employee of this Agreement or material violation of the Companys policies; or (e) willful and deliberate non-performance of duty by Employee in connection with the business affairs of the Company, provided , however , in the event of termination based on (c), (d) or (e), Employee will have a period of thirty (30) days after written notice to Employee from the Company to cure the circumstance, if curable.
Certificate of Incorporation means the Companys Certificate of Incorporation as in effect upon consummation of the Merger, as amended thereafter from time to time.
Confidential Information means all information of a confidential or proprietary nature (whether or not specifically labeled or identified as confidential), in any form or medium that relates to the Company or its Subsidiaries or their business relations and their respective business activities. Confidential Information includes, but is not limited to, the following: (a) internal business information (including information relating to strategic and staffing plans and practices, business, training, marketing, promotional and sales plans and practices, cost, rate and pricing structures and accounting and business methods); (b) information concerning third party businesses received by the Company under appropriate confidentiality restrictions in connection with prospective acquisitions or strategic combinations; (c) identities and individual requirements of, and specific contractual arrangements with, the Companys and its Subsidiaries joint venture partners, vendors or customers and other business relations and their confidential information; (d) trade secrets, know-how, compilations of data and analyses, techniques, systems, formulae, research, records, reports, manuals, documentation, models, data and data bases relating thereto; (e) inventions, innovations, improvements, developments, methods, designs, analyses, drawings, reports and all similar or related information (whether or not patentable); (f) intellectual property rights; and (g) financial information.
Employee Shares means the shares purchased under the Original Agreement. Employee Shares will continue to be Employee Shares in the hands of any holder other than Employee (except for the Parent and except for transferees in a Public Sale), and except as
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otherwise provided herein, each such other holder of Employee Shares will succeed to all rights and obligations attributable to Employee as a holder of Employee Shares hereunder. Employee Shares will also include shares of the Parents shares issued with respect to Employee Shares by way of a share split, distribution or reorganization or upon conversion of the Parent into a corporation, by way of a stock split, stock dividend or other recapitalization. Notwithstanding the foregoing, all Unvested Shares shall remain Unvested Shares, subject to the vesting provisions of this Agreement, after any Transfer thereof.
Fair Market Value of each of the Employee Shares means the fair value of such shares as mutually determined in good faith by the Board and Employee. In the event the parties cannot agree on a fair market value, the fair market value shall be determined by a third party independent valuation consultant mutually agreed upon by the parties with the cost of such valuation shared equally by the parties.
Good Reason means that Employee resigns from employment with the Company after complying with the Good Reason Process because, without Employees prior written consent, the Company: (a) reduces Employees base salary in any material respect, except for across-the-board salary reductions not to exceed 10% based on the Companys financial performance similarly affecting all or substantially all senior management employees of the Company; (b) fails to pay any material incentive compensation to which Employee is actually entitled under this Agreement; (c) materially breaches any obligation of the Company under this Agreement; (d) makes a material reduction in Employees job responsibilities so as to constitute a de facto demotion (other than a change effected in connection with the integration of the operations of the Company into the operations of an acquirer in connection with a Liquidity Event); (e) removes Employee from the position of Chief Strategy Officer other than in connection with a Liquidity Event; or (f) relocates Employees principal place of work to a location more than 25 miles from the location at the Effective Date, without Employees prior written approval.
Good Reason Process means that (a) Employee reasonably determines in good faith that a Good Reason condition has occurred; (b) Employee notifies the Company in writing of the first occurrence of the Good Reason condition within 90 days of the first occurrence of such condition; (c) Employee cooperates in good faith with the Companys efforts, for a period not less than 30 days following such notice to remedy the condition; (d) notwithstanding such efforts, the Good Reason condition continues to exist; and (e) Employee terminates Employees employment within 60 days after the end of the cure period contemplated by clause (c) above. If the Company cures the Good Reason condition during such cure period, Good Reason shall be deemed not to have occurred.
Liquidity Event means (a) any transaction or series of transactions, excluding in each case the issuance of securities by the Parent in a financing transaction approved by the Board, pursuant to which any person(s) or entity(ies) other than TB and its Affiliates, in the aggregate, acquire(s) shares of the Parent possessing the voting power to elect a majority of the Parents Board (whether by merger, consolidation, reorganization, combination, sale or transfer of the Parents shares, securityholder or voting agreement, proxy, power of attorney or otherwise), (b) the sale of all or substantially all of the Parents assets determined on a consolidated basis, whether in a single or a series of transactions, or (c) a Sale of the Company.
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Original Cost means with respect to each share of Common Stock purchased by the Employee hereunder, the price per share of Common Stock as set forth in Section 1(a) hereof (as proportionately adjusted for all subsequent share or stock splits, stock dividends, reorganizations and other recapitalizations).
Permanent Disability means Employees inability, because of any physical or mental injury, illness or incapacity to continue to perform substantially all of the essential functions of his duties and responsibilities under this Agreement notwithstanding the provision of any reasonable accommodations, for up to 180 days during any 365 consecutive calendar days.
Person means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
Public Sale means any sale pursuant to a registered public offering under the Securities Act or any sale to the public pursuant to Rule 144 promulgated under the Securities Act effected through a broker, dealer or market maker.
Sale of the Company means any transaction or series of related transactions other than a Public Sale pursuant to which any person or group of Persons acting in concert (other than TB or an Affiliate of TB), together with such Persons or group of Persons Affiliates, acquire(s) (i) the capital stock of the Parent possessing the voting power to elect a majority of the Board (whether by merger, consolidation, reorganization, combination, sale or transfer of the Parents capital stock, shareholder or voting agreement, proxy, power of attorney or otherwise), (ii) all or substantially all of the Parents assets determined on a consolidated basis, or (iii) fifty percent (50%) or more of the issued and outstanding shares of capital stock of the Company.
Securities Act means the Securities Act of 1933, as amended from time to time.
Subsidiary means any corporation of which the Parent or the Company owns securities having a majority of the ordinary voting power in electing the board of directors directly or through one or more subsidiaries.
TB means, collectively, Thoma Bravo Fund XI, L.P., a Delaware limited partnership, Thoma Bravo Fund XI-A, L.P., a Delaware limited partnership and Thoma Bravo Executive Fund XI, L.P.
Transfer means to directly or indirectly sell, transfer, assign, pledge or otherwise dispose of or grant any direct or indirect interest in (whether with or without consideration and whether voluntarily or involuntarily or by operation of law) the applicable property.
11. Notices . All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (a) when delivered personally to the recipient, (b) one day after being sent to the recipient by reputable overnight courier service (charges prepaid), (c) upon machine-generated acknowledgement of receipt after transmittal by facsimile, (d) upon a confirmation of receipt by return email from the recipient after being sent by email, or (e) five days after being mailed to
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the recipient by certified or registered mail, return receipt requested and postage prepaid. Such notices, demands and other communications shall be sent to the Company and the Employee at the address set forth below and to any other recipient or any subsequent holder of Employee Shares subject to this Agreement at such address as indicated by the Companys records, or at such address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.
Notices to Employee :
Addressed to the most recent address of Employee on the Companys records.
Notices to the Company :
SailPoint Technologies, Inc.
11305 Four Points Drive, Building 2, Suite 100
Austin, Texas 78726
Attention: General Counsel
E-mail: legal@sailpoint.com
or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party.
12. Expenses . Each party shall bear its or his expenses, including legal fees, arising in connection with the negotiation and execution of this Agreement and the consummation of the transactions contemplated by this Agreement.
13. General Provisions .
(a) Transfers in Violation of Agreement . Any Transfer or attempted Transfer of any Employee Shares in violation of any provision of this Agreement shall be void, and the Company shall not record such Transfer on its books or treat any purported transferee of such Employee Shares as the owner of such shares for any purpose.
(b) Severability . Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
(c) Initial Public Sale . Prior to March 31 of the calendar year following the occurrence of an initial Public Sale, Employee shall have the opportunity to review the terms of this Agreement with the Company and the Company may amend the terms of this Agreement at such time.
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(d) Complete Agreement . This Agreement, the Certificate of Incorporation, the EPIIAA, that certain Restrictive Covenant Agreement entered into by and between Employee and the Company dated September 8, 2014 and those other documents expressly referred to herein and therein embody the complete agreement and understanding among the parties and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.
(e) Counterparts . This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement. Signed counterparts of this Agreement may be delivered by facsimile and by scanned pdf image.
(f) Successors and Assigns . Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by Employee, the Company and their respective successors and assigns (including subsequent holders of Employee Shares); provided , however , except as otherwise provided herein, the rights and obligations of Employee under this Agreement shall not be assignable except in connection with a Permitted Transfer of Employee Shares hereunder.
(g) Choice of Law . All issues and questions concerning the relative rights of the Company and its Stockholders and all other issues and questions concerning the construction, validity and interpretation of this Agreement and the exhibits hereto will be governed by, and construed in accordance with, the internal laws of the State of Texas, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Texas.
(h) JURISDICTION AND VENUE . THE PARTIES TO THIS AGREEMENT HEREBY SUBMIT TO THE JURISDICTION OF THE STATE OR FEDERAL COURTS SITTING IN TEXAS AND HEREBY AGREE THAT THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO, AND ANY CLAIMS OR DISPUTES RELATING THERETO, SHALL BE ENFORCEABLE EXCLUSIVELY IN SUCH COURTS. EACH PARTY AGREES THAT ALL CLAIMS IN RESPECT OF THE ACTION OR PROCEEDING MAY BE HEARD IN SUCH COURT. EACH PARTY ALSO AGREES NOT TO BRING ANY ACTION OR PROCEEDING ARISING OR OUT OF OR RELATING TO THIS AGREEMENT IN ANY OTHER COURT. EACH OF THE PARTIES WAIVES ANY DEFENSE OF INCONVENIENT FORUM TO THE MAINTENANCE OF ANY ACTION OR PROCEEDING SO BROUGHT AND WAIVES ANY BOND SURETY OR OTHER SECURITY THAT MIGHT BE REQUIRED OF ANY OTHER PARTY WITH RESPECT THERETO.
(i) WAIVER OF JURY TRIAL . THE PARTIES HEREBY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
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(j) Remedies . Each of the parties to this Agreement will be entitled to enforce its rights under this Agreement specifically, to recover damages and costs (including attorneys fees) caused by any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Agreement.
(k) Amendment and Waiver . The provisions of this Agreement may be amended and waived only with the prior written consent of the Company and Employee.
(l) Business Days . If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the state in which the Companys chief executive office is located, the time period shall be automatically extended to the business day immediately following such Saturday, Sunday or holiday.
(m) Termination . Except as otherwise provided herein, this Agreement shall survive the Termination of Employees employment with the Company and shall remain in full force and effect after such Termination.
(n) No Strict Construction . The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.
(o) Descriptive Headings; Interpretation . The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement. The use of the word including in this Agreement shall be by way of example rather than by limitation.
* * * * * * *
[This Space Left Intentionally Blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Senior Management and Restricted Stock Agreement as of the date first written above.
PARENT: | ||
SAILPOINT TECHNOLOGIES HOLDINGS, INC. |
By: |
/s/ James C. McMartin |
|
Name: | James C. McMartin | |
Title: | CFO |
COMPANY: | ||
SAILPOINT TECHNOLOGIES, INC. |
By: |
/s/ James C. McMartin |
|
Name: | James C. McMartin | |
Title: | CFO |
EMPLOYEE: | ||
/s/ Kevin Cunningham |
||
Kevin Cunningham |
[Signature Page to Amended and Restated Senior Management and Restricted Stock Agreement]
Exhibit 10.12
AMENDED AND RESTATED
SENIOR MANAGEMENT AND RESTRICTED STOCK AGREEMENT
(Mark McClain)
THIS AMENDED AND RESTATED SENIOR MANAGEMENT AND RESTRICTED STOCK AGREEMENT (this Agreement ) is dated as of November 5, 2017 by and among SailPoint Technologies Holdings, Inc., a Delaware corporation (the Parent ), SailPoint Technologies, Inc., a Delaware corporation (the Company ), and Mark McClain, an individual (the Executive ). This Agreement amends and restates that certain Senior Management and Restricted Stock Agreement by and among the Parent, the Company and the Executive dated September 8, 2014 (the Original Agreement ). September 8, 2014, the effective date of the Original Agreement is referred to herein as the Effective Date . This Agreement is being entered into in anticipation of the Parents initial public offering of common stock. This Agreement shall become effective on the business day immediately preceding (but conditioned on) the closing of the Parents initial public offering of common stock (the Amendment Effective Date ), and the Original Agreement shall remain in full force and effect until the Amendment Effective Date. In the event that the closing of the Parents initial public offering of common stock does not occur for any reason prior to October 1, 2018, this Agreement shall be null and void and the Original Agreement will remain in full force and effect pursuant to its original terms.
Recitals
A. The Parent and Executive previously entered into the Original Agreement pursuant to which Executive purchased, and the Parent sold, subject to certain vesting and other restrictions as set forth herein, 1,075,000 shares of the common stock, par value $0.001 per share, of the Parent (the Common Stock ). All such shares of Common Stock are referred to herein as Executive Stock . For clarity, the 1,833,846 shares of Common Stock and the 9,387.3764 shares of preferred stock, par value $0.001 per share, of the Parent acquired by the Employee (and his affiliate) pursuant that certain Agreement and Plan of Merger, dated as of August 10, 2014, by and among Parent, Project Spyglass Merger Sub, Inc. and Company Fortis Advisors LLC shall not be considered Employee Stock for purposes of this Agreement.
B. Certain definitions are set forth in Section 10 of this Agreement.
Agreement
In consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement agree as follows:
PROVISIONS RELATING TO THE EXECUTIVE STOCK
1. Purchase and Sale of Executive Stock .
(a) On the Effective Date, the Parent (i) established an equity incentive pool (the Incentive Equity Pool ), and (ii) granted Executive a number of shares of Common Stock equal to approximately 14.333% of the Equity Incentive Pool (the Effective Date, which is the
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date upon which such shares of Common Stock were granted, is referred to herein as the Grant Date ). On the Grant Date, Executive purchased, and the Parent sold, such shares of Common Stock at a price per share of $0.0517 per share, of which (A) 50% of such shares of Common Stock are referred to herein as Time-Vested Shares and (B) 50% of such shares of Common Stock are referred to herein as Annual-Vested Shares .
(b) Within 30 days after the Grant Date, Executive made an election with the Internal Revenue Service under Section 83(b) of the Internal Revenue Code and the regulations promulgated thereunder.
(c) In connection with the purchase and sale of the Executive Stock hereunder, Executive represented, warranted and covenanted and hereby represents, warrants and covenants to the Parent and the Company that:
(i) The Executive Stock acquired by Executive pursuant to the Original Agreement was acquired for Executives own account and not with a view to, or intention of, distribution thereof in violation of the Securities Act, or any applicable state securities laws, and the Executive Stock will not be disposed of in contravention of the Securities Act or any applicable state securities laws.
(ii) Executive is both an accredited investor (as defined in the rules under the Securities Act) and an executive officer of the Company, is sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Executive Stock.
(iii) Executive is able to bear the economic risk of his investment in the Executive Stock for an indefinite period of time because the Executive Stock has not been registered under the Securities Act and, therefore, cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available.
(iv) Executive has had an opportunity to ask questions and receive answers concerning the terms and conditions of the offering of Executive Stock and has had full access to such other information concerning the Parent as he has requested and has had the opportunity to consult with his own independent counsel regarding his investment in Executive Stock.
(v) This Agreement and each of the other agreements contemplated hereby constitute the legal, valid and binding obligation of Executive, enforceable in accordance with their respective terms, and the execution, delivery and performance of this Agreement and such other agreements by Executive does not and will not conflict with, violate or cause a breach of any agreement, contract or instrument to which Executive is a party or any statute, rule, judgment, order or decree to which Executive is subject.
(vi) Executive is a resident of the State of Texas.
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(d) As an inducement to the Parent to issue the Executive Stock to Executive, and as a condition thereto, Executive acknowledged and agreed and hereby acknowledges and agrees that neither the issuance of the Executive Stock to Executive nor any provision contained herein shall entitle Executive to remain in the employment of the Parent and its Subsidiaries or affect the right of the Company to terminate Executives employment at any time for any reason.
2. Vesting of Certain Executive Stock .
(a) Time-Vested Shares and Annual-Vested Shares are subject to vesting as further described in this Section 2 based upon Executives continued employment with the Company.
(b) Except as otherwise provided in Section 2(d) below, the Time-Vested Shares will continue to become vested in accordance with the following schedule, if as of each such date Executive remains continuously employed by the Parent or any of its Subsidiaries: (i) 25% of the Time-Vested Shares became vested on the first anniversary of the Effective Date and (ii) the remaining Time-Vested Shares have or will become vested in equal installments on a monthly basis over the 36-month period following such first anniversary of the Effective Date.
(c) Except as otherwise provided in Section 2(d) below, the Annual-Vested Shares will continue to become vested in accordance with the following schedule if as of each such date Executive remains continuously employed by the Parent or any of its Subsidiaries:
(i) twenty-five percent (25%) of the Annual-Vested Shares became vested on January 15, 2016 (the First Annual Vest Date );
(ii) an additional twenty-five percent (25%) of the Annual Vested Shares have or will become vested on each of the first and second anniversaries of the First Annual Vest Date; and
(iii) any remaining Annual-Vested Shares will become vested on the third anniversary of the First Annual Vest Date.
(d) Upon the occurrence of a Liquidity Event, 100% of the Unvested Executive Stock shall become vested immediately prior to such Liquidity Event; provided , however , that if Executive ceases to be continuously employed by the Parent or its Subsidiaries until immediately prior to such Liquidity Event, then no Unvested Executive Stock shall vest in accordance with this Section 2(d) .
(e) All shares of Executive Stock which become vested in accordance with this Section 2 are referred to herein as Vested Shares , and all other shares of Executive Stock are referred to herein as Unvested Shares .
(f) Notwithstanding the provisions of this Section 2 , this Agreement shall not result in fewer shares of Employee Stock being Vested Shares hereunder on the Amendment Effective Date than the number of shares of Employee Stock that were Vested Shares under the Original Agreement as of immediately prior to the Amendment Effective Date and shares of Employee Stock that have become Vested Shares as of the Amendment Effective Date shall remain Vested Shares under this Agreement.
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3. Repurchase Options .
(a) In the event Executive ceases to be employed by the Company and its Subsidiaries for any reason (a Termination ), all of the Unvested Shares will be subject to repurchase by the Parent pursuant to the terms and conditions set forth in this Section 3 (the Repurchase Option ).
(b) The purchase price for each Unvested Share will be Executives Original Cost for such share.
(c) The board of directors of the Parent (the Board ) may elect to cause the Parent to purchase all or any portion of any of the Unvested Shares by delivering written notice (the Repurchase Notice ) to the Executive within 90 days after the Termination for any Unvested Shares. The Repurchase Notice will set forth the number of Unvested Shares to be acquired, the aggregate consideration to be paid for such shares and the time and place for the closing of the transaction. Additionally, the Board may cause the Parent to assign its rights under this Section 3 to one or more of its Affiliates.
(d) The closing of the purchase of the Unvested Shares pursuant to the Repurchase Option shall take place on the date designated by the Parent in the Repurchase Notice, which date shall not be more than 30 days nor less than five days after the delivery of such notice. The Parent will pay for the Unvested Shares to be purchased by it pursuant to the Repurchase Option by first offsetting amounts outstanding under any bona fide debts for money borrowed from the Parent or for travel and expense advances owed by Executive to the Parent; upon full repayment of such bona fide debts, the Parent will make payment by a check or wire transfer of funds in the aggregate amount of the remaining purchase price for such Unvested Shares. The Parent will be entitled to receive customary representations and warranties from the sellers regarding such sale and to require all sellers signatures be guaranteed.
(e) Notwithstanding anything to the contrary contained in this Agreement, all repurchases of Unvested Shares by the Parent shall be subject to applicable restrictions contained in the Delaware General Corporation Law and in the Parents and its Subsidiaries debt and equity financing agreements.
4. Restrictions on Transfer of Executive Stock .
(a) The Unvested Shares are restricted in that they may not be sold, transferred or otherwise alienated or hypothecated until they become Vested Shares as described in Section 2 of this Agreement. The Unvested Shares are also restricted in the sense that they may be subject to the Repurchase Option.
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(b) The certificates representing the Executive Stock will bear a legend in substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH IN A CERTAIN AMENDED AND RESTATED SENIOR MANAGEMENT AND RESTRICTED STOCK AGREEMENT BETWEEN THE COMPANY AND AN EXECUTIVE OF THE COMPANY DATED AS OF NOVEMBER 5, 2017. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE COMPANYS PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
PROVISIONS RELATING TO EMPLOYMENT
5. Employment . The Company agrees to employ Executive and Executive accepts such employment for the period beginning as of the Effective Date and ending upon the effective date of Executives Termination pursuant to Section 5(f) hereof (the Employment Period ).
(a) During the Employment Period, Executive shall serve as the Chief Executive Officer of the Company and shall have such duties and responsibilities as are typically commensurate with such position. Executive shall have such other powers and perform such other duties as may from time to time reasonably be prescribed by the Board which are consistent with the position of Chief Executive Officer. Executives authority shall be subject to the power of the Board to expand such duties, responsibilities and authority, subject to Executives acceptance of any such expansion, and to override actions of Executive.
(b) Executive shall report to the Board, and Executive shall devote appropriate time and attention to the business and affairs of the Company and its Subsidiaries.
(c) During the Employment Period, Executives base salary shall be $350,000 per annum (as in effect from time to time, the Base Salary ). Executives Base Salary shall be payable in regular installments in accordance with the Companys general payroll practices and shall be subject to customary withholding for income tax, social security, and other applicable taxes. Executives Base Salary for any partial year will be prorated based upon the number of days elapsed in such year.
(d) Bonuses .
(i) In addition to the Base Salary, the Executive shall be entitled to an award of an annual performance bonus (the Bonus ) following the end of each fiscal year during the Employment Period commencing with the fiscal year ending December 31, 2015, based upon the Companys achievement of budgetary and other objectives, including specific objectives relating to Executives contributions, set by the Board in consultation with Executive no later than March 31 of the applicable bonus year.
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(ii) Except where otherwise provided, the Bonus for any fiscal year will be payable to the Executive in cash promptly upon completion of the Companys audited financial statements for such fiscal year, but in any event within 120 days following the end of such fiscal year.
(e) Benefits . In addition to the Base Salary and any Bonuses payable to Executive pursuant to this Agreement, Executive shall be entitled to the following benefits during the Employment Period:
(i) reimbursement for reasonable business expenses incurred by Executive on the Companys behalf and within the Companys stated policies and procedures for expense reimbursement, subject to providing appropriate documentation thereof to the Company;
(ii) participation in all health, disability and welfare plans available to the Companys senior executives;
(iii) participation in all life insurance plans available to the Companys senior executives;
(iv) participation in all retirement plans available to the Companys senior executives; and
(v) participation in any paid-time-off policies available to the Companys senior executives.
(f) Termination .
(i) The Employment Period shall continue until Executives resignation, death, Permanent Disability (as such term is defined in Section 10 ) or until the Board determines in its good faith judgment that termination of Executives employment ( Termination ) is in the best interests of the Company.
(ii) If the Employment Period is terminated by the Company with Cause or by Executive without Good Reason, Executive shall be entitled to receive Executives Base Salary (as in effect at time of Termination) through the effective date of Executives Termination but shall not be entitled to any Bonus for such current fiscal year, provided , however , that Executive will receive his earned but unpaid bonus, if any, for the prior fiscal year.
(iii) If the Employment Period is terminated due to death or Permanent Disability, Executive shall be entitled to receive Executives Base Salary for the period through the date of death or the date when the Employment Period is terminated as a result of Permanent Disability. In addition, Executive will be entitled to Executives vested rights under any benefit plans (including any disability plans, 401(k) plans or other retirement plans).
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(iv) If at any time the Employment Period is terminated by the Company without Cause or by Executive for Good Reason, Executive shall be entitled to receive the following (collectively, the Severance Benefits ): (A) Executives Base Salary through the date that is twelve (12) months after the effective date of such Termination, payable in equal installments on the Companys regular salary payment dates commencing on the first payroll date that is sixty (60) days from the date of such termination (with the first payment including amounts otherwise payable during such 60-day period (the First Payment Date )); (B) a lump-sum payment equal to Executives annual target bonus, payable on the First Payment Date ( provided , that the payment contemplated by this clause (B) shall only be payable if Executive would have achieved his financial objectives for the fiscal year his termination of employment occurs, based on the pro-rata results actually achieved by Executive prior to the date of his termination as compared to the pro-rata objectives established for Executives target bonus for the then-current fiscal year); (C) twelve (12) months of COBRA payments, provided that the Company shall not be obligated to pay any COBRA payments to Executive to the extent Executive elects not to receive COBRA coverage from the Company; and (D) a portion of any remaining unvested Time-Vested Shares and Annual-Vested Shares equal to the amount of Time-Vested Shares that would have vested over the 12-month period immediately following the date the Employment Period shall become vested. Any of the Severance Benefits contemplated by this Section 5 shall be conditioned upon Executives execution and delivery to the Company of a general release in form and substance satisfactory to the Company and Executive (the Release ), which Release shall become effective and irrevocable within 60 days of the termination date and upon Executives compliance with the terms of Sections 6 and 7 below, and upon any breach by Executive of the provisions of Sections 6 and 7 below, the Companys obligation to make any Severance Benefits shall immediately terminate.
(v) Anything provided herein to the contrary notwithstanding, nothing in this Agreement shall confer upon the Executive any right to continue in the service of the Company (or any Company or Subsidiary of the Company employing or retaining Executive) for any period of time or interfere with or restrict in any way the rights of the Company (or any Company or Subsidiary of the Company employing or retaining Executive) or the Executive, which rights are hereby expressly reserved by each, to terminate the employee status of Executive at any time for any reason whatsoever or for no reason with or without cause.
(g) No Investor Obligation . For the avoidance of doubt, notwithstanding the rights, if any, granted to TB hereunder, in no case shall TB be responsible for any obligation of the Company pursuant to this Section 5 , and Executive hereby covenants for the benefit of TB that he will not make any assertions to the contrary.
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6. Affirmation of Continuing Covenants . Executive expressly acknowledges that Executives obligations pursuant to that certain Employment, Proprietary Information, and Inventions Assignment Agreement (the EPIIAA ) entered into by and between Executive and the Company dated December 1, 2005 continue to be in full force and effect and covenants and agrees to abide by the terms set forth therein.
7. Restrictive Covenants .
(a) Noncompetition . In further consideration of the opportunity to purchase the Executive Stock hereunder, Executive acknowledges that during the course of his employment with the Company and its Affiliates (including, without limitation, any predecessors thereof) he has become familiar with, and during the course of his employment with the Company and its Subsidiaries he will become familiar with, the Companys and its Subsidiaries trade secrets and with other Confidential Information. Executive acknowledges that his services shall be of special, unique and extraordinary value to the Company and its Subsidiaries and that the Companys ability to accomplish its purposes and to successfully pursue its business plan and compete in the marketplace depend substantially on the skills and expertise of the Executive. Therefore, and in further consideration of the opportunity to purchase the Executive Stock hereunder, Executive agrees that, during the Executives period of employment with the Company or any of its Subsidiaries and for 18 months thereafter, he shall not directly or indirectly engage or become interested in (whether as an owner, partner, director, officer, employee, consultant, stockholder or otherwise) any business that provides, offers or is otherwise directly or indirectly engaged in providing or offering (including through acquiring companies which provide or offer) products or services anywhere in the world that are competitive with the Business. For purposes of this Agreement, Business shall mean the business of providing on-premises and hosted (i.e., SaaS-based) identity and access management solutions to enterprise and government customers, including data and risk management, compliance and provisioning solutions and services.
(b) Nonsolicitation . In addition, during the Executives period of employment with the Company or any of its Subsidiaries and for 18 months thereafter, Executive shall not (and shall cause all of his Affiliates not to) directly or indirectly through another entity or person (i) induce or attempt to induce any employee of the Parent or any of its Subsidiaries (including the Company) to leave the employ of the Parent or any of its Subsidiaries (including the Company), or in any way interfere with the relationship between the Parent or any of its Subsidiaries (including the Company) and any employee thereof, (ii) hire (in any capacity) any person who was an employee of the Parent or any of its Subsidiaries (including the Company) at any time during the one (1) year period immediately prior to the date on which such hiring would take place (it being conclusively presumed by the parties so as to avoid any disputes under this Section 7(b) that any such hiring within such one (1) year period is in violation of Section 7(a) above), (iii) for so long as Executive has any obligations under Section 7(a) above, call on, solicit or service any customer, supplier, licensee, licensor or other business relation of the Parent or any of its Subsidiaries (including the Company) in order to induce or attempt to induce such Person to cease doing business with the Parent or any of its Subsidiaries (including the Company), or in any way interfere with the relationship between any such customer, supplier, licensee or business relation and the Parent or any of its Subsidiaries (including the Company), including making any negative statements or communications about the Parent or any of its
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Subsidiaries (including the Company) or (iv) initiate or engage in any discussions regarding an acquisition of, or Executives employment (whether as an employee, an independent contractor or otherwise) by, any businesses with which the Parent or any of its Subsidiaries (including the Company) has entertained discussions or has requested and received information relating to the acquisition of such business by the Parent or any of its Subsidiaries (including the Company) prior to the termination of the Executives employment with the Company.
(c) Enforcement . If, at the time of enforcement of this Section 7 , a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration, scope or geographical area reasonable under such circumstances shall be substituted for the stated duration, scope or area and that the court shall be allowed to revise the restrictions contained herein to cover the maximum duration, scope and area permitted by law. Because Executives services are unique and because Executive has access to Confidential Information, the parties hereto agree that money damages would not be an adequate remedy for any breach of this Agreement. Therefore, in the event a breach or threatened breach of this Agreement, the Company or its successors or assigns may, in addition to other rights and remedies existing in their favor, apply to any court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof (without posting a bond or other security and without proving damages).
8. Section 409A .
(a) Anything in this Agreement to the contrary notwithstanding, if at the time of the Executives separation from service within the meaning of Section 409A of the Code, the Company determines that the Executive is a specified employee within the meaning of Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that the Executive becomes entitled to under this Agreement on account of the Executives separation from service would be considered deferred compensation subject to the 20 percent additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and such benefit shall not be provided until the date that is the earlier of (i) six months and one day after the Executives separation from service, or (ii) the Executives death. If any such delayed cash payment is otherwise payable on an installment basis, the first payment shall include a catch-up payment covering amounts that would otherwise have been paid during the six-month period but for the application of this provision, and the balance of the installments shall be payable in accordance with their original schedule.
(b) All in-kind benefits provided and expenses eligible for reimbursement under this Agreement shall be provided by the Company or incurred by the Executive during the time periods set forth in this Agreement. All reimbursements shall be paid as soon as administratively practicable, but in no event shall any reimbursement be paid after the last day of the taxable year following the taxable year in which the expense was incurred. The amount of in-kind benefits provided or reimbursable expenses incurred in one taxable year shall not affect the in-kind benefits to be provided or the expenses eligible for reimbursement in any other taxable year. Such right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.
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(c) To the extent that any payment or benefit described in this Agreement constitutes non-qualified deferred compensation under Section 409A of the Code, and to the extent that such payment or benefit is payable upon the Executives termination of employment, then such payments or benefits shall be payable only upon the Executives separation from service. The determination of whether and when a separation from service has occurred shall be made in accordance with the presumptions set forth in Treasury Regulation Section 1.409A-1(h).
(d) The parties intend that this Agreement will be administered in accordance with Section 409A of the Code. To the extent that any provision of this Agreement is ambiguous as to its compliance with Section 409A of the Code, the provision shall be read in such a manner so that all payments hereunder comply with Section 409A of the Code. The parties agree that this Agreement may be amended, as reasonably requested by either party, and as may be necessary to fully comply with Section 409A of the Code and all related rules and regulations in order to preserve the payments and benefits provided hereunder without additional cost to either party.
(e) The Company makes no representation or warranty and shall have no liability to the Executive or any other person if any provisions of this Agreement are determined to constitute deferred compensation subject to Section 409A of the Code but do not satisfy an exemption from, or the conditions of, such Section.
GENERAL PROVISIONS
9. Withholding . The Parent or the Company may withhold from any and all amounts payable under this Agreement or otherwise such federal, state, local or foreign withholding taxes, excise taxes, or employment taxes ( Taxes ) as may be required to be withheld pursuant to any applicable law or regulation. Executive shall pay to the Parent or the Company or make arrangements satisfactory to the Parent to pay the amount of all applicable Taxes that the Parent or the Company is required to withhold at any time. If Executive shall fail to make such payment, the Parent or the Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to Executive any Taxes of any kind required by law to be withheld with respect to the Executive Stock. Executive acknowledges that it is Executives sole responsibility, and not the Parents or the Companys, to file timely and properly the election under Section 83(b) of the Internal Revenue Code and any corresponding provisions of state tax laws. In the event that the Parent or the Company fails to withhold any Taxes required to be withheld by applicable law or regulation, Executive shall indemnify the Parent and its Subsidiaries (including the Company) for any amounts paid by the Parent or the Company with respect to any such Taxes but only to the extent Executive has not already paid such Taxes; provided , however , that Executive shall not be required to indemnify the Parent or the Company for any interest, penalties and related expenses thereto.
10. Definitions .
Affiliate means, as to any Person, any other Person, which directly or indirectly controls, or is under common control with, or is controlled by, such Person. As used in this definition, control (including, with its correlative meanings, controlled by and under common control with) shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise).
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Cause means a vote of the Board resolving that Executive should be dismissed as a result of (a) Executives conviction of a felony; (b) Executive engaging in any other act of fraud, intentional misrepresentation, moral turpitude, misappropriation or embezzlement, illegality or unlawful harassment which, as determined by the Board in good faith and in light of all available facts, would: (i) materially adversely affect the business or the reputation of the Company with its current or prospective customers, suppliers, lenders and/or other third parties with whom the Company does or might do business; or (ii) expose the Company to a risk of material civil or criminal legal damages, liabilities or penalties; (c) the repeated willful failure by Executive to follow the reasonable directives of the Board in connection with the business affairs of the Company; (d) any material breach by Executive of this Agreement or material violation of the Companys policies; or (e) willful and deliberate non-performance of duty by Executive in connection with the business affairs of the Company, provided , however , in the event of termination based on (c), (d) or (e), Executive will have a period of thirty (30) days after written notice to Executive from the Company to cure the circumstance, if curable.
Certificate of Incorporation means the Companys Certificate of Incorporation as in effect upon consummation of the Merger, as amended thereafter from time to time.
Confidential Information means all information of a confidential or proprietary nature (whether or not specifically labeled or identified as confidential), in any form or medium that relates to the Company or its Subsidiaries or their business relations and their respective business activities. Confidential Information includes, but is not limited to, the following: (a) internal business information (including information relating to strategic and staffing plans and practices, business, training, marketing, promotional and sales plans and practices, cost, rate and pricing structures and accounting and business methods); (b) information concerning third party businesses received by the Company under appropriate confidentiality restrictions in connection with prospective acquisitions or strategic combinations; (c) identities and individual requirements of, and specific contractual arrangements with, the Companys and its Subsidiaries joint venture partners, vendors or customers and other business relations and their confidential information; (d) trade secrets, know-how, compilations of data and analyses, techniques, systems, formulae, research, records, reports, manuals, documentation, models, data and data bases relating thereto; (e) inventions, innovations, improvements, developments, methods, designs, analyses, drawings, reports and all similar or related information (whether or not patentable); (f) intellectual property rights; and (g) financial information.
Executive Shares means the shares purchased under the Original Agreement. Executive Shares will continue to be Executive Shares in the hands of any holder other than Executive (except for the Parent and except for transferees in a Public Sale), and except as otherwise provided herein, each such other holder of Executive Shares will succeed to all rights and obligations attributable to Executive as a holder of Executive Shares hereunder. Executive Shares will also include shares of the Parents shares issued with respect to Executive Shares by way of a share split, distribution or reorganization or upon conversion of the Parent into a corporation, by way of a stock split, stock dividend or other recapitalization. Notwithstanding the foregoing, all Unvested Shares shall remain Unvested Shares, subject to the vesting provisions of this Agreement, after any Transfer thereof.
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Fair Market Value of each of the Executive Shares means the fair value of such shares as mutually determined in good faith by the Board and Executive. In the event the parties cannot agree on a fair market value, the fair market value shall be determined by a third party independent valuation consultant mutually agreed upon by the parties with the cost of such valuation shared equally by the parties.
Good Reason means that Executive resigns from employment with the Company after complying with the Good Reason Process because, without Executives prior written consent, the Company: (a) reduces Executives base salary in any material respect, except for across-the-board salary reductions not to exceed 10% based on the Companys financial performance similarly affecting all or substantially all senior management employees of the Company; (b) fails to pay any material incentive compensation to which Executive is actually entitled under this Agreement; (c) materially breaches any obligation of the Company under this Agreement; (d) makes a material reduction in Executives job responsibilities so as to constitute a de facto demotion (other than a change effected in connection with the integration of the operations of the Company into the operations of an acquirer in connection with a Liquidity Event); (e) removes Executive from the position of Chief Executive Officer other than in connection with a Liquidity Event; or (f) relocates Executives principal place of work to a location more than 25 miles from the location at the Effective Date, without Executives prior written approval.
Good Reason Process means that (a) Executive reasonably determines in good faith that a Good Reason condition has occurred; (b) Executive notifies the Company in writing of the first occurrence of the Good Reason condition within 90 days of the first occurrence of such condition; (c) Executive cooperates in good faith with the Companys efforts, for a period not less than 30 days following such notice to remedy the condition; (d) notwithstanding such efforts, the Good Reason condition continues to exist; and (e) Executive terminates Executives employment within 60 days after the end of the cure period contemplated by clause (c) above. If the Company cures the Good Reason condition during such cure period, Good Reason shall be deemed not to have occurred.
Liquidity Event means (a) any transaction or series of transactions, excluding in each case the issuance of securities by the Parent in a financing transaction approved by the Board, pursuant to which any person(s) or entity(ies) other than TB and its Affiliates, in the aggregate, acquire(s) shares of the Parent possessing the voting power to elect a majority of the Parents Board (whether by merger, consolidation, reorganization, combination, sale or transfer of the Parents shares, securityholder or voting agreement, proxy, power of attorney or otherwise), (b) the sale of all or substantially all of the Parents assets determined on a consolidated basis, whether in a single or a series of transactions, or (c) a Sale of the Company.
Original Cost means with respect to each share of Common Stock purchased by the Executive hereunder, the price per share of Common Stock as set forth in Section 1(a) hereof (as proportionately adjusted for all subsequent share or stock splits, stock dividends, reorganizations and other recapitalizations).
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Permanent Disability means Executives inability, because of any physical or mental injury, illness or incapacity to continue to perform substantially all of the essential functions of his duties and responsibilities under this Agreement notwithstanding the provision of any reasonable accommodations, for up to 180 days during any 365 consecutive calendar days.
Person means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
Public Sale means any sale pursuant to a registered public offering under the Securities Act or any sale to the public pursuant to Rule 144 promulgated under the Securities Act effected through a broker, dealer or market maker.
Sale of the Company means any transaction or series of related transactions other than a Public Sale pursuant to which any person or group of Persons acting in concert (other than TB or an Affiliate of TB), together with such Persons or group of Persons Affiliates, acquire(s) (i) the capital stock of the Parent possessing the voting power to elect a majority of the Board (whether by merger, consolidation, reorganization, combination, sale or transfer of the Parents capital stock, shareholder or voting agreement, proxy, power of attorney or otherwise), (ii) all or substantially all of the Parents assets determined on a consolidated basis, or (iii) fifty percent (50%) or more of the issued and outstanding shares of capital stock of the Company.
Securities Act means the Securities Act of 1933, as amended from time to time.
Subsidiary means any corporation of which the Parent or the Company owns securities having a majority of the ordinary voting power in electing the board of directors directly or through one or more subsidiaries.
TB means, collectively, Thoma Bravo Fund XI, L.P., a Delaware limited partnership, Thoma Bravo Fund XI-A, L.P., a Delaware limited partnership and Thoma Bravo Executive Fund XI, L.P.
Transfer means to directly or indirectly sell, transfer, assign, pledge or otherwise dispose of or grant any direct or indirect interest in (whether with or without consideration and whether voluntarily or involuntarily or by operation of law) the applicable property.
11. Notices . All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (a) when delivered personally to the recipient, (b) one day after being sent to the recipient by reputable overnight courier service (charges prepaid), (c) upon machine-generated acknowledgement of receipt after transmittal by facsimile, (d) upon a confirmation of receipt by return email from the recipient after being sent by email, or (e) five days after being mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid. Such notices, demands and other communications shall be sent to the Company and the Executive at the address set forth below and to any other recipient or any subsequent holder of Executive Shares subject to this Agreement at such address as indicated by the Companys records, or at such address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.
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Notices to Executive :
Addressed to the most recent address of Executive on the Companys records.
Notices to the Company :
SailPoint Technologies, Inc.
11305 Four Points Drive, Building 2, Suite 100
Austin, Texas 78726
Attention: General Counsel
E-mail: legal@sailpoint.com
or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party.
12. Expenses . Each party shall bear its or his expenses, including legal fees, arising in connection with the negotiation and execution of this Agreement and the consummation of the transactions contemplated by this Agreement.
13. General Provisions .
(a) Transfers in Violation of Agreement . Any Transfer or attempted Transfer of any Executive Shares in violation of any provision of this Agreement shall be void, and the Company shall not record such Transfer on its books or treat any purported transferee of such Executive Shares as the owner of such shares for any purpose.
(b) Severability . Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
(c) Initial Public Sale . Prior to March 31 of the calendar year following the occurrence of an initial Public Sale, Executive shall have the opportunity to review the terms of this Agreement with the Company and the Company may amend the terms of this Agreement at such time.
(d) Complete Agreement . This Agreement, the Certificate of Incorporation, the EPIIAA, that certain Restrictive Covenant Agreement entered into by and between Employee and the Company dated September 8, 2014 and those other documents expressly referred to herein and therein embody the complete agreement and understanding among the parties and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.
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(e) Counterparts . This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement. Signed counterparts of this Agreement may be delivered by facsimile and by scanned pdf image.
(f) Successors and Assigns . Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by Executive, the Company and their respective successors and assigns (including subsequent holders of Executive Shares); provided , however , except as otherwise provided herein, the rights and obligations of Executive under this Agreement shall not be assignable except in connection with a Permitted Transfer of Executive Shares hereunder.
(g) Choice of Law . All issues and questions concerning the relative rights of the Company and its Stockholders and all other issues and questions concerning the construction, validity and interpretation of this Agreement and the exhibits hereto will be governed by, and construed in accordance with, the internal laws of the State of Texas, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Texas.
(h) JURISDICTION AND VENUE . THE PARTIES TO THIS AGREEMENT HEREBY SUBMIT TO THE JURISDICTION OF THE STATE OR FEDERAL COURTS SITTING IN TEXAS AND HEREBY AGREE THAT THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO, AND ANY CLAIMS OR DISPUTES RELATING THERETO, SHALL BE ENFORCEABLE EXCLUSIVELY IN SUCH COURTS. EACH PARTY AGREES THAT ALL CLAIMS IN RESPECT OF THE ACTION OR PROCEEDING MAY BE HEARD IN SUCH COURT. EACH PARTY ALSO AGREES NOT TO BRING ANY ACTION OR PROCEEDING ARISING OR OUT OF OR RELATING TO THIS AGREEMENT IN ANY OTHER COURT. EACH OF THE PARTIES WAIVES ANY DEFENSE OF INCONVENIENT FORUM TO THE MAINTENANCE OF ANY ACTION OR PROCEEDING SO BROUGHT AND WAIVES ANY BOND SURETY OR OTHER SECURITY THAT MIGHT BE REQUIRED OF ANY OTHER PARTY WITH RESPECT THERETO.
(i) WAIVER OF JURY TRIAL . THE PARTIES HEREBY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(j) Remedies . Each of the parties to this Agreement will be entitled to enforce its rights under this Agreement specifically, to recover damages and costs (including attorneys fees) caused by any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Agreement.
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(k) Amendment and Waiver . The provisions of this Agreement may be amended and waived only with the prior written consent of the Company and Executive.
(l) Business Days . If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the state in which the Companys chief executive office is located, the time period shall be automatically extended to the business day immediately following such Saturday, Sunday or holiday.
(m) Termination . Except as otherwise provided herein, this Agreement shall survive the Termination of Executives employment with the Company and shall remain in full force and effect after such Termination.
(n) No Strict Construction . The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.
(o) Descriptive Headings; Interpretation . The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement. The use of the word including in this Agreement shall be by way of example rather than by limitation.
* * * * * * *
[This Space Left Intentionally Blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Senior Management and Restricted Stock Agreement as of the date first written above.
PARENT: | ||
SAILPOINT TECHNOLOGIES HOLDINGS, INC. |
By: |
/s/ James C. McMartin |
|
Name: | James C. McMartin | |
Title: | CFO |
COMPANY: | ||
SAILPOINT TECHNOLOGIES, INC. |
By: |
/s/ James C. McMartin |
|
Name: | James C. McMartin | |
Title: | CFO |
EXECUTIVE: | ||
/s/ Mark D. McClain |
||
Mark D. McClain |
[Signature Page to Amended and Restated Senior Management and Restricted Stock Agreement]
Exhibit 10.14
AMENDED AND RESTATED
RESTRICTED STOCK AGREEMENT
THIS AMENDED AND RESTATED RESTRICTED STOCK AGREEMENT (this Agreement ) is dated as of November 5, 2017, by and among SailPoint Technologies Holdings, Inc., a Delaware corporation (the Parent ), SailPoint Technologies, Inc., a Delaware corporation (the Company ), and Howard Greenfield, an individual (the Purchaser ). This Agreement amends and restates that certain Restricted Stock Agreement by and among the Parent, the Company and the Executive dated December 15, 2014, as amended from time to time (the Original Agreement ). December 15, 2014, the effective date of the Original Agreement, is referred to herein as the Grant Date . This Agreement is being entered into in anticipation of the Parents initial public offering of common stock. This Agreement shall become effective on the business day immediately preceding (but conditioned on) the closing of the Parents initial public offering of common stock (the Amendment Effective Date ), and the Original Agreement shall remain in full force and effect until the Amendment Effective Date. In the event that such closing of the Parents initial public offering of common stock does not occur for any reason prior to October 1, 2018, this Agreement shall be null and void and the Original Agreement will remain in full force and effect pursuant to its original terms.
Recitals
A. The Parent and Purchaser previously entered into the Original Agreement pursuant to which Purchaser purchased, and the Parent sold, subject to certain vesting and other restrictions as set forth herein, 375,000 shares of the common stock, par value $0.001 per share, of the Parent (the Common Stock ). All such shares of Common Stock hereby are referred to herein as Restricted Stock. For clarity, any other shares of Common Stock Purchaser may own shall not be considered Restricted Stock for purposes of this Agreement.
B. Certain definitions are set forth in Section 9 of this Agreement.
Agreement
In consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement agree as follows:
PROVISIONS RELATING TO THE RESTRICTED STOCK
1. | Purchase and Sale of Restricted Stock . |
(a) On the Grant Date, Purchaser purchased, and the Parent sold, 375,000 shares of Common Stock at a price of $0.0517 per share, of which (i) 187,500 shares of such Common Stock are referred to herein as Time-Vested Shares and (ii) 187,500 shares of such Common Stock are referred to herein as Annual-Vested Shares.
(b) The Common Stock acquired by the Purchaser pursuant to Section 1(a) above is referred to herein as the Restricted Stock.
(c) Within 30 days after the Effective Date, Purchaser made an election with the Internal Revenue Service under Section 83(b) of the Internal Revenue Code and the regulations promulgated thereunder.
(d) In connection with the purchase and sale of the Restricted Stock hereunder, Purchaser represented, warranted and covenanted and hereby represents, warrants and covenants to the Parent and the Company that:
(i) The Restricted Stock acquired by Purchaser pursuant to the Original Agreement was acquired for Purchasers own account and not with a view to, or intention of, distribution thereof in violation of the Securities Act, or any applicable state securities laws, and the Restricted Stock will not be disposed of in contravention of the Securities Act or any applicable state securities laws.
(ii) Purchaser is either an accredited investor (as defined in the rules under the Securities Act), an executive officer of the Company or is an employee of the Company, and is sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Restricted Stock.
(iii) Purchaser is able to bear the economic risk of his (or her) investment in the Restricted Stock for an indefinite period of time because the Restricted Stock has not been registered under the Securities Act and, therefore, cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available.
(iv) Purchaser has had an opportunity to ask questions and receive answers concerning the terms and conditions of the offering of Restricted Stock and has had full access to such other information concerning the Parent as he has requested and has had the opportunity to consult with his (or her) own independent counsel regarding his (or her) investment in Restricted Stock.
(v) This Agreement and each of the other agreements contemplated hereby constitute the legal, valid and binding obligation of Purchaser, enforceable in accordance with their respective terms, and the execution, delivery and performance of this Agreement and such other agreements by Purchaser does not and will not conflict with, violate or cause a breach of any agreement, contract or instrument to which Purchaser is a party or any statute, rule, judgment, order or decree to which Purchaser is subject.
(vi) Purchaser is a resident of Georgia.
(e) As an inducement to the Parent to issue the Restricted Stock to Purchaser, and as a condition thereto, Purchaser acknowledged and agreed and hereby acknowledges and agrees that neither the issuance of the Restricted Stock to Purchaser nor any provision contained herein shall entitle Purchaser to remain in the employment of the Parent and its Subsidiaries or affect the right of the Company to terminate Purchasers employment at any time for any reason.
2. | Vesting of Certain Restricted Stock. |
(a) Time-Vested Shares and Annual-Vested Shares are subject to vesting as further described in this Section 2 based upon Purchasers continued employment with the Company.
(b) Except as otherwise provided in Section 2(d) below, the Time-Vested Shares will continue to become vested in accordance with the following schedule, if as of each such date Purchaser remains continuously employed by Parent or any of its Subsidiaries: (i) 25% of the Time-Vested Shares became vested on September 7, 2015 and (ii) the remaining Time-Vested Shares have or will become vested in equal installments on a monthly basis over the 36-month period following September 7, 2015.
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(c) Except as otherwise provided in Section 2(d) below, the Annual-Vested Shares will become vested in accordance with the following schedule if as of each such date Executive remains continuously employed by the Parent or any of its Subsidiaries:
(i) twenty-five percent (25%) of the Annual-Vested Shares became vested on January 15, 2016 (the First Annual Vest Date );
(ii) an additional twenty-five percent (25%) of the Annual-Vested Shares have or will become vested on each of the first and second anniversaries of the First Annual Vest Date; and
(iii) any remaining Annual-Vested Shares will become vested on the third anniversary of the First Annual Vest Date.
(d) In the event both (i) a Sale Event occurs and (ii) Purchasers continuous status as a Service Provider is terminated either (A) by the Company or the acquiring entity without Cause or (B) by Purchaser for Good Reason, in either case, within the twelve month period immediately following such Sale Event, then 100% of the Unvested Restricted Stock shall become vested as of the termination of Purchasers status as a Service Provider; provided, however, that if Purchasers continuous status as a Service Provider ceases prior to any Sale Event, then no Unvested Restricted Stock shall vest in accordance with this Section 2(d).
(e) All shares of Restricted Stock which have become vested in accordance with this Section 2 are referred to herein as Vested Shares , and all other shares of Restricted Stock are referred to herein as Unvested Shares .
(f) Notwithstanding the vesting provisions of this Section 2 , this Agreement shall not result in fewer Shares being Vested Shares hereunder on the Amendment Effective Date than the number of Shares that were Vested Shares under the Original Agreement as of immediately prior to the Amendment Effective Date and Shares that have become Vested Shares as of the date of this Agreement shall remain Vested Shares under this Agreement.
3. | Repurchase Options . |
(a) In the event Purchaser ceases to be employed by the Company and its Subsidiaries for any reason (a Termination ), all of the Unvested Shares will be subject to repurchase by the Parent pursuant to the terms and conditions set forth in this Section 3 (the Repurchase Option ).
(b) The purchase price for each Unvested Share will be Purchasers Original Cost for such share.
(c) The board of directors of the Parent (the Board ) may elect to cause the Parent to purchase all or any portion of any of the Unvested Shares by delivering written notice (the Repurchase Notice ) to the Purchaser within 90 days after the Termination for any Unvested Shares. The Repurchase Notice will set forth the number of Unvested Shares to be acquired, the aggregate consideration to be paid for such shares and the time and place for the closing of the transaction. Additionally, the Board may cause the Parent to assign its rights under this Section 3 to one or more of its Affiliates.
(d) The closing of the purchase of the Unvested Shares pursuant to the Repurchase Option shall take place on the date designated by the Parent in the Repurchase Notice, which date shall not be more than 30 days nor less than five days after the delivery of such notice. The Parent will pay for the Restricted Stock to be purchased by it pursuant to the Repurchase Option by first offsetting amounts
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outstanding under any bona fide debts for money borrowed from the Parent or for travel and expense advances owed by Purchaser to the Parent; upon full repayment of such bona fide debts, the Parent will make payment by a check or wire transfer of funds in the aggregate amount of the remaining purchase price for such Unvested Shares. The Parent will be entitled to receive customary representations and warranties from the sellers regarding such sale and to require all sellers signatures be guaranteed.
(e) Notwithstanding anything to the contrary contained in this Agreement, all repurchases of Unvested Shares by the Parent shall be subject to applicable restrictions contained in the Delaware General Corporation Law and in the Parents and its Subsidiaries debt and equity financing agreements.
4. | Restrictions on Transfer of Restricted Stock . |
(a) The Unvested Shares are restricted in that they may not be sold, transferred or otherwise alienated or hypothecated until they become Vested Shares as described in Section 2 of this Agreement. The Unvested Shares are also restricted in the sense that they may be subject to the Repurchase Option.
(b) The certificates representing the Restricted Stock will bear a legend in substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH IN A CERTAIN AMENDED AND RESTRICTED STOCK AGREEMENT BETWEEN THE COMPANY AND A PURCHASER OF THE COMPANY DATED AS OF NOVEMBER 5, 2017. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE COMPANYS PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
PROVISIONS RELATING TO CONFIDENTIALITY, NON-SOLICITATION AND TAX-RELATED COVENANTS
5. Affirmation of Continuing Covenants . Employee expressly acknowledges that Employees obligations pursuant to that certain Employment, Proprietary Information, and Inventions Assignment Agreement (the EPIIAA ) entered into by and between Employee and the Company dated May 21, 2014 continue to be in full force and effect and covenants and agrees to abide by the terms set forth therein.
6. | Restrictive Covenants. |
(a) Noncompetition . In further consideration of the opportunity to purchase the Restricted Stock hereunder, Purchaser acknowledges that during the course of his (or her) employment with the Company and its Affiliates (including, without limitation, any predecessors thereof) he has become familiar with, and during the course of his (or her) employment with the Company and its Subsidiaries he will become familiar with, the Companys and its Subsidiaries trade secrets and with other Confidential Information. Purchaser acknowledges that his (or her) services shall be of special, unique and extraordinary value to the Company and its Subsidiaries and that the Companys ability to accomplish its purposes and to successfully pursue its business plan and compete in the marketplace depend substantially on the skills and expertise of the Purchaser. Therefore, and in further consideration of the opportunity to purchase the Restricted Stock hereunder, Purchaser agrees that, during the Purchasers period of employment with the Company or any of its Subsidiaries and for 12 months thereafter, he shall not directly or indirectly engage or become interested in (whether as an owner, partner, director, officer, employee, consultant, stockholder or otherwise) any business that provides, offers or is
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otherwise directly or indirectly engaged in providing or offering (including through acquiring companies which provide or offer) products or services anywhere in the world that are competitive with the Business. For purposes of this Agreement, Business shall mean the business of providing on-premises and hosted (i.e., SaaS-based) identity and access management solutions to enterprise and government customers, including data and risk management, compliance and provisioning solutions and services.
(b) Nonsolicitation . In addition, during the Purchasers period of employment with the Company or any of its Subsidiaries and for 12 months thereafter, Purchaser shall not (and shall cause all of his (or her) Affiliates not to) directly or indirectly through another entity or person (i) induce or attempt to induce any employee of the Parent or any of its Subsidiaries (including the Company) to leave the employ of the Parent or any of its Subsidiaries (including the Company), or in any way interfere with the relationship between the Parent or any of its Subsidiaries (including the Company) and any employee thereof, (ii) hire (in any capacity) any person who was an employee of the Parent or any of its Subsidiaries (including the Company) at any time during the one (1) year period immediately prior to the date on which such hiring would take place (it being conclusively presumed by the parties so as to avoid any disputes under this Section 7(b) that any such hiring within such one (1) year period is in violation of Section 7(a) above), (iii) for so long as Purchaser has any obligations under Section 7(a) above, call on, solicit or service any customer, supplier, licensee, licensor or other business relation of the Parent or any of its Subsidiaries (including the Company) in order to induce or attempt to induce such Person to cease doing business with the Parent or any of its Subsidiaries (including the Company), or in any way interfere with the relationship between any such customer, supplier, licensee or business relation and the Parent or any of its Subsidiaries (including the Company), including making any negative statements or communications about TB, the Parent or any of its Subsidiaries (including the Company) or (iv) initiate or engage in any discussions regarding an acquisition of, or Purchasers employment (whether as an employee, an independent contractor or otherwise) by, any businesses with which the Parent or any of its Subsidiaries (including the Company) has entertained discussions or has requested and received information relating to the acquisition of such business by the Parent or any of its Subsidiaries (including the Company) prior to the termination of the Purchasers employment with the Company.
(c) Enforcement . If, at the time of enforcement of this Section 6, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration, scope or geographical area reasonable under such circumstances shall be substituted for the stated duration, scope or area and that the court shall be allowed to revise the restrictions contained herein to cover the maximum duration, scope and area permitted by law. Because Purchasers services are unique and because Purchaser has access to Confidential Information, the parties hereto agree that money damages would not be an adequate remedy for any breach of this Agreement. Therefore, in the event a breach or threatened breach of this Agreement, the Company or its successors or assigns may, in addition to other rights and remedies existing in their favor, apply to any court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof (without posting a bond or other security and without proving damages).
7. Withholding . The Parent or the Company may withhold from any and all amounts payable under this Agreement or otherwise such federal, state, local or foreign withholding taxes, excise taxes, or employment taxes ( Taxes ) as may be required to be withheld pursuant to any applicable law or regulation. Purchaser shall pay to the Parent or the Company or make arrangements satisfactory to the Parent to pay the amount of all applicable Taxes that the Parent or the Company is required to withhold at any time. If Purchaser shall fail to make such payment, the Parent or the Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to Purchaser any Taxes of any kind required by law to be withheld with respect to the Restricted Stock. Purchaser acknowledges that it is Purchasers sole responsibility, and not the Parents or the Companys, to file timely and properly the election under Section 83(b) of the Internal Revenue Code and any corresponding
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provisions of state tax laws. In the event that the Parent or the Company fails to withhold any Taxes required to be withheld by applicable law or regulation, Purchaser shall indemnify the Parent and its Subsidiaries (including the Company) for any amounts paid by the Parent or the Company with respect to any such Taxes but only to the extent Purchaser has not already paid such Taxes; provided , however , that Purchaser shall not be required to indemnify the Parent or the Company for any interest, penalties and related expenses thereto.
GENERAL PROVISIONS
8. | Definitions . |
Affiliate means, as to any Person, any other Person, which directly or indirectly controls, or is under common control with, or is controlled by, such Person. As used in this definition, control (including, with its correlative meanings, controlled by and under common control with) shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise).
Cause means a vote of the Board resolving that Purchaser should be dismissed as a result of (i) Purchasers conviction of a felony (ii) Purchaser engaging in any other act of fraud, intentional misrepresentation, moral turpitude, misappropriation or embezzlement, illegality or unlawful harassment which, as determined by the Board in good faith and in light of all available facts, would: (A) materially adversely affect the business or the reputation of the Company with its current or prospective customers, suppliers, lenders and/or other third parties with whom the Company does or might do business; or (B) expose the Company to a risk of material civil or criminal legal damages, liabilities or penalties; (iii) the repeated willful failure by Purchaser to follow the reasonable directives of the Board in connection with the business affairs of the Company, or (iv) any material breach by Purchaser of this Agreement or material violation of the Companys policies or (v) willful and deliberate non-performance of duty by Purchaser in connection with the business affairs of the Company, provided, however, in the event of termination based on (iii), (iv) or (v), Purchaser will have a period of thirty (30) days after written notice to Purchaser from the Company to cure the circumstance, if curable.
Certificate of Incorporation means the Companys Certificate of Incorporation, as amended thereafter from time to time.
Confidential Information means all information of a confidential or proprietary nature (whether or not specifically labeled or identified as confidential), in any form or medium that relates to the Company or its Subsidiaries or their business relations and their respective business activities. Confidential Information includes, but is not limited to, the following: (i) internal business information (including information relating to strategic and staffing plans and practices, business, training, marketing, promotional and sales plans and practices, cost, rate and pricing structures and accounting and business methods); (ii) information concerning third party businesses received by the Company under appropriate confidentiality restrictions in connection with prospective acquisitions or strategic combinations, (iii) identities and individual requirements of, and specific contractual arrangements with, the Companys and its Subsidiaries joint venture partners, vendors or customers and other business relations and their confidential information; (iv) trade secrets, know-how, compilations of data and analyses, techniques, systems, formulae, research, records, reports, manuals, documentation, models, data and data bases relating thereto; (v) inventions, innovations, improvements, developments, methods, designs, analyses, drawings, reports and all similar or related information (whether or not patentable), (vi) intellectual property rights, and (vii) financial information.
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Good Reason shall be defined as in Purchasers then-current employment agreement with the Company or, if no such agreement is in place, it means Purchasers resignation within thirty (30) days following the expiration of any Company cure period following the occurrence of one or more of the following, without Purchasers express written consent: (i) a material reduction of Purchasers duties, authority or responsibilities; provided, however, that a reduction in duties, authority or responsibilities solely by virtue of the Company being acquired and made part of a larger entity will not constitute Good Reason; (ii) a material reduction in Purchasers base salary; or (iii) for purposes of a post-Sale of Company termination only, a material change in the geographic location of Purchasers primary work facility or location. Purchaser will not resign for Good Reason without first providing the Company with written notice of the acts or omissions constituting the grounds for Good Reason within ninety (90) days of the initial existence of the grounds for Good Reason and a reasonable cure period of not less than thirty (30) days following the date of such notice.
Original Cost means with respect to each share of Common Stock purchased by the Purchaser hereunder, the price per share of Common Stock as set forth in Section 1(a) hereof (as proportionately adjusted for all subsequent share or stock splits, stock dividends, reorganizations and other recapitalizations).
Person means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
Public Sale means any sale pursuant to a registered public offering under the Securities Act or any sale to the public pursuant to Rule 144 promulgated under the Securities Act effected through a broker, dealer or market maker.
Sale Event means and includes any of the following: (a) consummation of a merger or consolidation of the Parent with or into any other corporation or other entity in which holders of the Parents voting securities immediately prior to such merger or consolidation will not, directly or indirectly, continue to hold at least a majority of the outstanding voting securities of the Parent; (b) a sale, lease, exchange or other transfer (in one transaction or a related series of transactions) of all or substantially all of the Parents and its Subsidiaries assets on a consolidated basis to an unrelated person or entity; (c) the acquisition by any person or any group of persons, acting together in any transaction or related series of transactions, of such quantity of the Parents voting securities as causes such person, or group of persons, to own beneficially, directly or indirectly, as of the time immediately after such transaction or related series of transactions, 50 percent or more of the combined voting power of the voting securities of the Parent other than as a result of (i) an acquisition of securities directly from the Parent or (ii) an acquisition of securities by the Parent which, by reducing the voting securities outstanding, increases the proportionate voting power represented by the voting securities owned by any such person or group of persons to 50 percent or more of the combined voting power of such voting securities; or (d) the liquidation or dissolution of the Parent.
Securities Act means the Securities Act of 1933, as amended from time to time.
Service Provider means an employee, consultant, advisor, officer or director of the Company and/or any parent or subsidiary of the Company.
Subsidiary means any corporation of which the Company or the Company owns securities having a majority of the ordinary voting power in electing the board of directors directly or through one or more subsidiaries.
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Transfer means to directly or indirectly sell, transfer, assign, pledge or otherwise dispose of or grant any direct or indirect interest in (whether with or without consideration and whether voluntarily or involuntarily or by operation of law) the applicable property.
9. | Notices . |
All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (i) when delivered personally to the recipient, (ii) one day after being sent to the recipient by reputable overnight courier service (charges prepaid), (iii) upon machine-generated acknowledgement of receipt after transmittal by facsimile, (iv) upon a confirmation of receipt by return email from the recipient after being sent by email, or (v) five days after being mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid. Such notices, demands and other communications shall be sent to the Company and the Purchaser at the address set forth below.
Notices to Purchaser :
Addressed to the most recent address of the Purchaser on the Companys records.
Notices to the Company :
SailPoint Technologies, Inc.
11305 Four Points Drive, Building 2, Suite 100
Austin, Texas 78726
Attention: General Counsel
E-mail: legal@sailpoint.com
or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party.
10. Expenses . Each party shall bear its or his (or her) expenses, including legal fees, arising in connection with the negotiation and execution of this Agreement and the consummation of the transactions contemplated by this Agreement.
11. | General Provisions . |
(a) Transfers in Violation of Agreement . Any Transfer or attempted Transfer of any Unvested Shares in violation of any provision of this Agreement or the Stockholders Agreement shall be void, and the Company shall not record such Transfer on its books or treat any purported transferee of such Unvested Shares as the owner of such shares for any purpose.
(b) Severability . Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
(c) Complete Agreement . This Agreement, the EPIIAA, the Certificate of Incorporation and those other documents expressly referred to herein and therein embody the complete agreement and understanding among the parties and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.
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(d) Counterparts . This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement. Signed counterparts of this Agreement may be delivered by facsimile and by scanned pdf image.
(e) Successors and Assigns . Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by Purchaser, the Company, and their respective successors and assigns; provided, however, except as otherwise provided herein, the rights and obligations of Purchaser under this Agreement shall not be assignable.
(f) Choice of Law . All issues and questions concerning the relative rights of the Company and its Stockholders and all other issues and questions concerning the construction, validity and interpretation of this Agreement and the exhibits hereto will be governed by, and construed in accordance with, the internal laws of the State of Texas, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Texas.
(g) JURISDICTION AND VENUE . THE PARTIES TO THIS AGREEMENT HEREBY SUBMIT TO THE JURISDICTION OF THE STATE OR FEDERAL COURTS SITTING IN TEXAS AND HEREBY AGREE THAT THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO, AND ANY CLAIMS OR DISPUTES RELATING THERETO, SHALL BE ENFORCEABLE EXCLUSIVELY IN SUCH COURTS. EACH PARTY AGREES THAT ALL CLAIMS IN RESPECT OF THE ACTION OR PROCEEDING MAY BE HEARD IN SUCH COURT. EACH PARTY ALSO AGREES NOT TO BRING ANY ACTION OR PROCEEDING ARISING OR OUT OF OR RELATING TO THIS AGREEMENT IN ANY OTHER COURT. EACH OF THE PARTIES WAIVES ANY DEFENSE OF INCONVENIENT FORUM TO THE MAINTENANCE OF ANY ACTION OR PROCEEDING SO BROUGHT AND WAIVES ANY BOND SURETY OR OTHER SECURITY THAT MIGHT BE REQUIRED OF ANY OTHER PARTY WITH RESPECT THERETO.
(h) WAIVER OF JURY TRIAL . THE PARTIES HEREBY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(i) Remedies . Each of the parties to this Agreement will be entitled to enforce its rights under this Agreement specifically, to recover damages and costs (including attorneys fees) caused by any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Agreement.
(j) Amendment and Waiver . The provisions of this Agreement may be amended and waived only with the prior written consent of the Company, TB and Purchaser.
(k) Business Days . If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the state in which the Companys chief executive office is located, the time period shall be automatically extended to the business day immediately following such Saturday, Sunday or holiday.
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(l) Termination . Except as otherwise provided herein, this Agreement shall survive the Termination of Purchasers employment with the Company and shall remain in full force and effect after such Termination.
(m) No Strict Construction . The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.
(n) Descriptive Headings; Interpretation . The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement. The use of the word including in this Agreement shall be by way of example rather than by limitation.
* * * * * * *
[This Space Left Intentionally Blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Restricted Stock Agreement as of the date first written above.
PARENT: | ||
SAILPOINT TECHNOLOGIES HOLDINGS, INC. |
By: |
/s/ James C. McMartin |
|
Name: |
James C. McMartin |
|
Title: |
CFO |
COMPANY: | ||
SAILPOINT TECHNOLOGIES, INC. |
By: |
/s/ James C. McMartin |
|
Name: |
James C. McMartin |
|
Title: |
CFO |
PURCHASER: | ||
/s/ Howard Greenfield Howard Greenfield |
S IGNATURE P AGE
TO
A MENDED AND R ESTATED R ESTRICTED S TOCK A GREEMENT
Exhibit 10.15
AMENDED AND RESTATED
EARLY EXERCISE INCENTIVE STOCK OPTION AGREEMENT
UNDER THE SAILPOINT TECHNOLOGIES HOLDINGS, INC.
AMENDED AND RESTATED 2015 STOCK OPTION PLAN
Name of Optionee: | Howard Greenfield (the Optionee) | |
No. of Time-Vested Option Shares: 20,000 Shares of Common Stock | ||
No. of Performance-Vested Option Shares: 20,000 Shares of Common Stock | ||
Amendment Date: | November 5, 2017 (the Amendment Date) | |
Grant Date: | April 29, 2016 (the Grant Date) | |
Expiration Date: | April 28, 2026 (the Expiration Date) | |
Option Exercise Price/Share: | $1.35655 (the Option Exercise Price) |
This Amended and Restated Early Exercise Incentive Stock Option Agreement (this Agreement) is made by and between the Optionee and SailPoint Technologies Holdings, Inc., a Delaware corporation (together with all successors thereto, the Company), effective as of the Amendment Date and pursuant to the SailPoint Technologies Holdings, Inc. 2015 Stock Option and Grant Plan, as amended and restated (the Plan). This Agreement amends and restates that certain Incentive Stock Option Agreement by and between the Optionee and the Company entered into pursuant to the SailPoint Technologies Holdings, Inc. 2015 Stock Option and Grant Plan, (the Original Agreement) whereby the Company granted to the Optionee, who was an employee of the Company or any of its Subsidiaries as of the Grant Date, an option (the Stock Option) to purchase on or prior to the Expiration Date, or such earlier date as is specified herein, all or any part of the number of shares of Common Stock, par value $0.0001 per share (Common Stock), of the Company indicated above of which (i) 20,000 shares of such Common Stock are referred to herein as Time-Vested Option Shares and (ii) 20,000 shares of such Common Stock are referred to herein as Annual-Vested Option Shares (together, the Option Shares, and such shares once issued shall be referred to as the Issued Shares), at the Option Exercise Price per share, subject to the terms and conditions set forth in this Incentive Stock Option Agreement (this Agreement) and in the Plan. Notwithstanding the vesting provisions hereunder, any Option Shares that were previously designated as Performance-Vested Option Shares under the Original Agreement and that have become vested as of the Amendment Date shall remain vested under this Agreement. This Agreement is being entered into in anticipation of the Companys initial public offering of common stock. This Agreement shall become effective on the business day immediately preceding (but conditioned on) the closing of the Parents initial public offering of common stock (the Amendment Effective Date), and the Original Agreement shall remain in full force and effect until the Amendment Effective Date. In the event that the closing of the Companys initial public offering of common stock does not occur for any reason prior to October 1, 2018, this Agreement shall be null and
void and the Original Agreement will remain in full force and effect pursuant to its original terms. This Stock Option is intended to qualify as an incentive stock option as defined in Section 422(b) of the Internal Revenue Code of 1986, as amended from time to time (the Code). To the extent that any portion of the Stock Option does not so qualify, it shall be deemed a non-qualified stock option.
1. Definitions . For the purposes of this Agreement, the following terms shall have the following respective meanings. All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Plan.
Affiliate means, as to any Person, any other Person which directly or indirectly controls, or is under common control with, or is controlled by, such Person. As used in this definition, control (including, with its correlative meanings, controlled by and under common control with) shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise).
Board shall mean the Board of Directors of the Company.
Cause means with respect to Optionees termination of employment (a) cause as defined in any employment agreement or consulting agreement between Optionee and the Company or any of its Subsidiaries, or, if Optionee is not a party to an employment agreement or consulting agreement in which cause is defined, then (b) (i) the conviction, or plea of nolo contendere to a felony or other crime involving moral turpitude, the misappropriation of funds or other material property of the Company or any of its Subsidiaries, the attempt to willfully obtain any personal profit from any transaction in which the Company or any of its Subsidiaries has an interest which is adverse to the interests of the Company or any of its Subsidiaries or any other act of fraud or embezzlement against the Company, any of its Subsidiaries or any of its customers or suppliers, (ii) reporting to work under the influence of alcohol or drugs or repeatedly using alcohol or illegal drugs or abusing legal drugs, whether or not at the workplace, in such a fashion as could reasonably be expected to cause the Company or any of its Subsidiaries material harm, (iii) substantial and repeated failure to perform duties as reasonably directed by the Company in writing, (iv) any intentional act or intentional omission aiding or abetting a competitor, supplier or customer of the Company or any of its Subsidiaries to the material disadvantage or detriment of the Company and its Subsidiaries, or (v) any breach of fiduciary duty, gross negligence or willful misconduct with respect to the Company or any of its Subsidiaries which (if capable of cure) is not cured to the Companys reasonable satisfaction within ten (10) days after written notice thereof to the Participant.
Committee shall mean the committee of the Board which may be designated by the Board to administer the Plan. The Committee shall be composed of two or more directors as appointed from time to time to serve by the Board (or such lesser or greater number of directors as shall constitute the minimum number permitted by applicable laws to establish a committee of the Board).
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Fair Market Value of each share of the Common Stock means the fair value of such Common Stock determined in good faith by the Committee, or, in the absence of the Committee, by the Board.
Initial Public Offering means the consummation of the first fully underwritten, firm commitment public offering pursuant to an effective registration statement under the Securities Act covering the offer and sale by the Company of its equity securities, as a result of or following which the capital stock of the Company shall be publicly held.
Investors means together, Thoma Bravo Fund XI, L.P., Thoma Bravo Fund XI-A, L.P. and Thoma Bravo Executive Fund XI, L.P.
Person shall mean any individual, corporation, partnership (limited or general), limited liability company, limited liability partnership, association, trust, joint venture, unincorporated organization or any similar entity.
Sale Event means any transaction or series of transactions pursuant to which any person(s) or entity(ies) other than the Investors and their Affiliates in the aggregate acquire(s) (i) capital stock of the Company possessing over 50% of the voting power (other than voting rights accruing only in the event of a default, breach or event of noncompliance) or the power to elect a majority of the Board (whether by merger, consolidation, reorganization, combination, sale or transfer of the Companys capital stock, shareholder or voting agreement, proxy, power of attorney or otherwise) or (ii) over 50% of the Companys assets determined on a consolidated basis. In no event will a public offering under the Securities Act be considered a Change of Control.
Service Relationship shall mean any relationship as an employee, part-time employee, director or other key person (including consultants) of the Company or any Subsidiary or any successor entity such that, for example, a Service Relationship shall be deemed to continue without interruption in the event the Optionees status changes from full-time employee to part-time employee or consultant.
Subsidiary means any corporation of which the Company owns securities having a majority of the ordinary voting power in electing the board of directors directly or through one or more subsidiaries.
2. | Vesting, Exercisability and Termination . |
(a) This Stock Option may be exercised prior to the Expiration Date, or such earlier date as provided herein and may be exercised prior to vesting. To the extent that the Optionee exercises any portion of this Option prior to vesting, the Optionee shall enter into a Restricted Stock Agreement (substantially in the form attached hereto as Appendix B, Restricted Stock Agreement) and any unvested shares shall be subject to repurchase for the lower of the Option Exercise Price or the then current Fair Market Value in the event the Optionees Service Relationship terminates prior to vesting.
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(b) Except as set forth below, and subject to the determination of the Committee in its sole discretion to accelerate the vesting schedule hereunder, this Stock Option shall be vested and exercisable with respect to the Option Shares on the respective dates indicated below:
(i) (A) twenty-five percent (25%) of the Time-Vested Option Shares became vested on April 29, 2017 and (B) the remaining Time-Vested Option Shares have or will become vested in equal installments on a monthly basis over the 36-month period following April 29, 2017.
(ii) The Annual-Vested Option Shares will become vested as follows:
(A) twenty-five percent (25%) of the Annual-Vested Option Shares became vested on January 15, 2017 (the First Annual Vest Date);
(B) an additional twenty-five percent (25%) of the Annual-Vested Option Shares have or will become vested on each of the first and second anniversaries of the First Annual Vest Date; and
(C) any remaining Annual-Vested Option Shares will become vested on the third anniversary of the First Annual Vest Date.
(c) Notwithstanding anything herein to the contrary, in the event of a Sale Event, this Stock Option and the Shares shall be treated as provided in Section 8.2 of the Plan.
(d) Termination . Except as may otherwise be provided by the Committee, if the Optionees Service Relationship is terminated, the period within which to exercise this Stock Option will be subject to earlier termination as set forth below (and if not exercised within such period, shall thereafter terminate):
(i) Termination Due to Death or Disability . If the Optionees Service Relationship terminates by reason of such Optionees death or disability (as defined in Section 422(c) of the Code), this Stock Option may be exercised, to the extent vested on the date of such termination, by the Optionee, the Optionees legal representative or legatee for a period of 12 months from the date of death or disability or until the Expiration Date, if earlier.
(ii) Other Termination . If the Optionees Service Relationship terminates for any reason other than death or disability (as defined in Section 422(c) of the Code), and unless otherwise determined by the Committee, this Stock Option may be exercised, to the extent vested on the date of termination, for a period of 90 days from the date of termination or until the Expiration Date, if earlier; provided however , if the Optionees Service Relationship is terminated for Cause, this Stock Option shall terminate immediately upon the date of such termination.
For purposes hereof, the Committees determination of the reason for termination of the Optionees employment shall be conclusive and binding on the Optionee and his or her representatives or legatees. Any portion of this Stock Option that is not vested and exercisable on the date of termination of the employment shall terminate immediately and be null and void.
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(e) It is understood and intended that this Stock Option is intended to qualify as an incentive stock option as defined in Section 422 of the Code to the extent permitted under applicable law. Accordingly, the Optionee understands that in order to obtain the benefits of an incentive stock option under Section 422 of the Code, no sale or other disposition may be made of Issued Shares for which incentive stock option treatment is desired within the one-year period beginning on the day after the day of the transfer of such Issued Shares to him or her, nor within the two-year period beginning on the day after the grant of this Stock Option and further that this Stock Option must be exercised within three months after termination of employment as an employee (or 12 months in the case of death or disability) to qualify as an incentive stock option. If the Optionee disposes (whether by sale, gift, transfer or otherwise) of any such Issued Shares within either of these periods, he or she will notify the Company within 30 days after such disposition. The Optionee also agrees to provide the Company with any information concerning any such dispositions required by the Company for tax purposes. Further, to the extent Option Shares and any other incentive stock options of the Optionee having an aggregate Fair Market Value in excess of $100,000 (determined as of the Grant Date) vest in any year, such options will not qualify as incentive stock options.
(f) Notwithstanding the vesting provisions of this Section 2, this Agreement shall not result in fewer Option Shares being vested hereunder on the Amendment Effective Date than the number of Option Shares that were vested under the Original Agreement as of immediately prior to the Amendment Effective Date and Option Shares that have become vested as of the Amendment Date shall remain vested under this Agreement.
3. | Exercise of Stock Option . |
(a) The Optionee may exercise this Stock Option only in the following manner: Prior to the Expiration Date, the Optionee may deliver a Stock Option exercise notice (an Exercise Notice) in the form of Appendix A hereto indicating his or her election to purchase some or all of the Option Shares. Such notice shall specify the number of Option Shares to be purchased. The Optionee shall deliver a Restricted Stock Agreement for any Option Shares the Optionee exercises that are not vested, and such Restricted Stock Agreement shall include the same vesting schedule for such unvested Option Shares as set forth herein. Payment of the purchase price may be made by one or more of the methods described below, at your election, with the approval of the Company (payment instruments will be received subject to collection):
(i) In cash, by certified or bank check, by wire transfer of immediately available funds, or other instrument acceptable to the Committee in U.S. funds payable to the order of the Company in an amount equal to the purchase price of such Option Shares;
(ii) by delivery to the Company of a number of shares of Stock having a Fair Market Value as of the date of exercise equal to the purchase price of such Option Shares; or
(iii) by net issue exercise, pursuant to which the Company will issue to you a number of shares of Stock equal to the number of Option Shares to be purchased, less a number of shares with a Fair Market Value as of the date of exercise equal to the purchase price of such Option Shares.
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(b) Certificates for the Option Shares so purchased will be issued and delivered to the Optionee upon compliance to the satisfaction of the Committee with all requirements under applicable laws or regulations in connection with such issuance. Until the Optionee shall have complied with the requirements hereof and of the Plan, the Company shall be under no obligation to issue the Option Shares subject to this Stock Option, and the determination of the Committee as to such compliance shall be final and binding on the Optionee. The Optionee shall not be deemed to be the holder of, or to have any of the rights of a holder with respect to, any shares of Common Stock subject to this Stock Option unless and until this Stock Option shall have been exercised pursuant to the terms hereof, the Company shall have issued and delivered the Issued Shares to the Optionee, and the Optionees name shall have been entered as a stockholder of record on the books of the Company. Thereupon, the Optionee shall have full dividend and other ownership rights with respect to such Issued Shares, subject to the terms of this Agreement.
(c) Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration Date.
4. Incorporation of Plan . Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed by all the terms and conditions of the Plan.
5. Transferability of Stock Option . This Agreement is personal to the Optionee and is not transferable by the Optionee in any manner other than by will or by the laws of descent and distribution. The Stock Option may be exercised during the Optionees lifetime only by the Optionee (or by the Optionees guardian or personal representative in the event of the Optionees incapacity). The Optionee may elect to designate a beneficiary by providing written notice of the name of such beneficiary to the Company, and may revoke or change such designation at any time by filing written notice of revocation or change with the Company; such beneficiary may exercise the Optionees Stock Option in the event of the Optionees death to the extent provided herein. If the Optionee does not designate a beneficiary, or if the designated beneficiary predeceases the Optionee, the legal representative of the Optionee may exercise this Stock Option to the extent provided herein in the event of the Optionees death.
6. | Effect of Certain Transactions . |
(a) In the case of a Sale Event, this Stock Option shall terminate upon the effective time of such Sale Event unless provision is made in connection with such transaction, in the sole discretion of the parties thereto, for the continuation or assumption of this Stock Option heretofore granted, or the substitution of this Stock Option with a new Stock Option of the successor entity or a parent thereof, with such adjustment to the number and kind of shares and the per share exercise prices as such parties shall agree. In the event of such a termination, the Optionee shall be permitted, for a specified period of time prior to the consummation of the Sale Event as determined by the Committee, to exercise all portions of the Stock Option which are then vested.
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7. Withholding Taxes . The Optionee shall, not later than the date as of which the exercise of this Stock Option becomes a taxable event for federal income tax purposes, pay to the Company or make arrangements satisfactory to the Committee for payment of any federal, state and local taxes required by law to be withheld on account of such taxable event. Subject to approval by the Committee, the Optionee may elect to have up to the maximum rate (with respect to the Optionee) of tax withholding obligation satisfied, in whole or in part, by authorizing the Company to withhold from shares of Common Stock to be issued or transferred to the Company, a number of shares of Common Stock with an aggregate Fair Market Value that would satisfy up to the maximum withholding amount due. The Optionee acknowledges and agrees that the Company or any Subsidiary of the Company has the right to deduct from payments of any kind otherwise due to the Optionee, or from the Option Shares to be issued in respect of an exercise of this Stock Option, any federal, state or local taxes of any kind required by law to be withheld with respect to the issuance of Option Shares to the Optionee.
8. Compliance with Securities Law . Notwithstanding any provision of this Agreement to the contrary, the grant of the Stock Option and the issuance of Stock will be subject to compliance with all applicable requirements of federal, state, and foreign securities laws and with the requirements of any stock exchange or market system upon which the Stock may then be listed. The Stock Option may not be exercised if the issuance of shares of Stock upon exercise would constitute a violation of any applicable federal, state, or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, the Stock Option may not be exercised unless (a) a registration statement under the Securities Act of 1933, as amended (the Securities Act), is at the time of exercise of the Stock Option in effect with respect to the shares issuable upon exercise of the Stock Option or (b) in the opinion of legal counsel to the Company, the shares issuable upon exercise of the Stock Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. YOU ARE CAUTIONED THAT THE STOCK OPTION MAY NOT BE EXERCISED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, YOU MAY NOT BE ABLE TO EXERCISE THE STOCK OPTION WHEN DESIRED EVEN THOUGH THE STOCK OPTION IS VESTED. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Companys legal counsel to be necessary to the lawful issuance and sale of any shares subject to the Stock Option will relieve the Company of any liability in respect of the failure to issue or sell such shares as to which such requisite authority has not been obtained. As a condition to the exercise of the Stock Option, the Company may require you to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect to such compliance as may be requested by the Company.
9. Lockup Provision . The Optionee agrees, if requested by the Company and any underwriter engaged by the Company, not to sell or otherwise transfer or dispose of any securities of the Company (including, without limitation, pursuant to Rule 144 under the Securities Act) held by him or her for (a) 180 days following the effective date of the relevant registration statement filed under the Securities Act in connection with the Companys Initial Public Offering, or (b) 90 days following the effective date of the relevant registration statement in connection with any other public offering of capital stock of the Company, as the Company and such underwriter shall specify reasonably and in good faith. Notwithstanding the foregoing,
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if: (x) during the last 17 days of the foregoing 180-day period or 90-day period, as applicable, the Company issues an earnings release or material news or a material event relating to the Company occurs; or (y) prior to the expiration of the 180-day period or 90-day period, as applicable, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the period, then the restrictions described above shall continue to apply until the expiration of an 18-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event. The Optionee agrees, if requested by the underwriter engaged by the Company, to execute a separate letter reflecting the agreement set forth in this Section 9.
10. | Miscellaneous Provisions . |
(a) Equitable Relief . The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.
(b) Adjustments for Changes in Capital Structure . If, as a result of any reorganization, recapitalization, reincorporation, reclassification, stock dividend, stock split, reverse stock split or other similar change in the Common Stock, the outstanding shares of Common Stock are increased or decreased or are exchanged for a different number or kind of shares of the Companys stock, the restrictions contained in this Agreement shall apply with equal force to additional and/or substitute securities, if any, received by the Optionee in exchange for, or by virtue of his or her ownership of, Issued Shares.
(c) Change and Modifications . This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Optionee.
(d) Governing Law . This Agreement shall be governed by and construed in accordance with the General Corporation Law of the State of Delaware as to matters within the scope hereof, and as to all other matters shall be governed by and construed in accordance with the internal laws of the State of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.
(e) Headings . The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.
(f) Saving Clause . If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.
(g) Notices . All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Optionee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other.
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(h) Benefit and Binding Effect . This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, permitted assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.
(i) Dispute Resolution . Except as provided below, any dispute arising out of or relating to this Agreement or the breach, termination or validity hereof shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the J.A.M.S. Rules). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. §§1-16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof. The place of arbitration shall be Austin, Texas.
The parties covenant and agree that the arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a partys witness or expert. The arbitrators decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrators decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages or any other damages that are specifically excluded under this Agreement, and each party hereby irrevocably waives any claim to such damages.
The parties covenant and agree that they will participate in the arbitration in good faith. This Section 10(i) applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.
Each of the parties hereto (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding
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is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each of the parties hereto hereby consents to service of process by registered mail at the address to which notices are to be given. Each of the parties hereto agrees that its, his or her submission to jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of the other parties hereto. Final judgment against any party hereto in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.
(j) Counterparts . For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document. Signed counterparts of this Agreement may be delivered by facsimile and by scanned pdf image.
[SIGNATURE PAGE FOLLOWS]
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The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned as of the Amendment Date.
SailPoint Technologies Holdings, Inc. | ||
By: |
/s/ James C. McMartin |
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Name: James C. McMartin | ||
Title: CFO | ||
Address: | ||
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The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned as of the Amendment Date.
OPTIONEE: |
/s/ Howard Greenfield |
Name: Howard Greenfield |
Address: |
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SPOUSES CONSENT
I acknowledge that I have read the
foregoing Amended and Restated Incentive Stock Option Agreement
and understand the contents thereof.
/s/ Donna Greenfield
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DESIGNATED BENEFICIARY: |
Donna Greenfield |
Beneficiarys Address: |
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Appendix A
STOCK OPTION EXERCISE NOTICE
SailPoint Technologies Holdings, Inc. |
Attention: |
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Pursuant to the terms of my stock option agreement dated (the Agreement) under the SailPoint Technologies Holdings, Inc. Amended and Restated 2015 Stock Option Plan, I, Howard Greenfield , hereby [Circle One] partially/fully exercise such option by including herein payment in the amount of $ representing the purchase price for [Fill in number of Option Shares] option shares. I have chosen the following form(s) of payment:
[ ] 1. Cash
[ ] 2. Certified or bank check payable to SailPoint Technologies Holdings, Inc.
[ ] 3. Other (as described in the Agreement (please describe))
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In connection with my exercise of the option as set forth above, I hereby represent and warrant to SailPoint Technologies Holdings, Inc. as follows:
(i) I am purchasing the option shares for my own account for investment only, and not for resale or with a view to the distribution thereof.
(ii) I have had such an opportunity as I have deemed adequate to obtain from SailPoint Technologies Holdings, Inc. such information as is necessary to permit me to evaluate the merits and risks of my investment in SailPoint Technologies Holdings, Inc. and have consulted with my own advisers with respect to my investment in SailPoint Technologies Holdings, Inc.
(iii) I have sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the purchase of the option shares and to make an informed investment decision with respect to such purchase.
(iv) I can afford a complete loss of the value of the option shares and am able to bear the economic risk of holding such option shares for an indefinite period of time.
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(v) I understand that the option shares may not be registered under the Securities Act of 1933 (it being understood that the option shares are being issued and sold in reliance on the exemption provided in Rule 701 thereunder) or any applicable state securities or blue sky laws and may not be sold or otherwise transferred or disposed of in the absence of an effective registration statement under the Securities Act of 1933 and under any applicable state securities or blue sky laws (or exemptions from the registration requirement thereof). I further acknowledge that certificates representing option shares will bear restrictive legends reflecting the foregoing.
Sincerely yours, |
Name: Howard Greenfield |
Address: |
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APPENDIX B
Restricted Stock Agreement
RESTRICTED STOCK AGREEMENT FOR EARLY EXERCISE OPTION
UNDER THE SAILPOINT TECHNOLOGIES HOLDINGS, INC.
AMENDED AND RESTATED 2015 STOCK OPTION PLAN
All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Amended and Restated Early Exercise Incentive Stock Option Agreement (the Option Agreement) between SailPoint Technologies Holdings, Inc. (the Company) and Howard Greenfield (the Grantee) for 40,000 Shares of Common Stock with a Grant Date of April 29, 2016 under the SailPoint Technologies Holdings, Inc. Amended and Restated 2015 Stock Option Plan (the Plan).
The Grantee agrees to the provisions set forth herein and acknowledges that each such provision is a material condition of the Companys agreement to issue and sell the Shares to him or her. The Company hereby acknowledges receipt of $ [ ] in full payment for the Shares pursuant to the Option Agreement. All references to share prices and amounts herein shall be equitably adjusted to reflect stock splits, stock dividends, recapitalizations, mergers, reorganizations and similar changes affecting the capital stock of the Company, and any shares of capital stock of the Company received on or in respect of Shares in connection with any such event (including any shares of capital stock or any right, option or warrant to receive the same or any security convertible into or exchangeable for any such shares or received upon conversion of any such shares) shall be subject to this Agreement on the same basis and extent at the relevant time as the Shares in respect of which they were issued, and shall be deemed Shares as if and to the same extent they were issued at the date hereof.
1. | Definitions . |
Investors means together, Thoma Bravo Fund XI, L.P., Thoma Bravo Fund XI-A, L.P. and Thoma Bravo Executive Fund XI, L.P.
Person shall mean any individual, corporation, partnership (limited or general), limited liability company, limited liability partnership, association, trust, joint venture, unincorporated organization or any similar entity.
Restricted Shares shall initially mean all of the Shares being purchased by the Grantee on the date hereof. As of the dates listed in the vesting schedule under the Option Agreement, the respective number of Option Shares that vest under the Option Agreement shall become Vested Shares if Grantee remains an employee on each such date.
Shares shall mean the number of shares of Common Stock being purchased by the Grantee on the date hereof and any additional shares of Common Stock or other securities received in respect of the Shares, as a dividend on, or otherwise on account of, the Shares.
Vested Shares shall mean all Shares which are not Restricted Shares.
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2. Purchase and Sale . On the date hereof, the Company hereby sells to the Grantee, and the Grantee hereby purchases from the Company, the number of Shares set forth above for the Per Share Purchase Price.
3. | Repurchase Right . |
(a) Right of Repurchase . The Company or its assigns shall have the right (the Repurchase Right) upon the occurrence of any of the events specified in Section 3(b) below (the Repurchase Event) to repurchase from the Grantee (or any Permitted Transferee) some or all (as determined by the Company) of the Restricted Shares held by the Grantee (or any Permitted Transferee) at the price per share specified below (the Repurchase Price). The Repurchase Right may be exercised by the Company within six months following the date of such event (the Repurchase Period). The Repurchase Right shall be exercised by the Company by giving the Grantee written notice on or before the last day of the Repurchase Period of its intention to exercise the Repurchase Right, and, together with such notice, tendering to the Grantee an amount equal to the Repurchase Price for the shares being repurchased. The Company may assign the Repurchase Right to one or more Persons. Upon such notification, the Grantee shall promptly surrender to the Company any certificates representing the Shares being repurchased, together with a duly executed stock power for the transfer of such Shares to the Company or the Companys assignee or assignees. Upon the Companys or its assignees receipt of the certificates from the Grantee or any Permitted Transferees (or at such later date as is determined necessary by the Committee to avoid any breach by the Company of any agreement to which it is a party), the Company or its assignee or assignees shall deliver to him, her or them a check for the Repurchase Price of the Shares being purchased; provided , however , that the Company may pay the Repurchase Price for such shares by offsetting and canceling any indebtedness then owed by the Grantee to the Company. The Repurchase Right with respect to Restricted Shares shall survive and remain in effect following and notwithstanding any public offering by or merger or other transaction involving the Company and certificates representing such Restricted Shares shall bear legends to such effect.
(b) Companys Right to Exercise Repurchase Right . The Company shall have the Repurchase Right in the event that the Grantees Service Relationship is terminated for any reason whatsoever, regardless of the circumstances thereof, and including without limitation upon death, disability, retirement, discharge or resignation for any reason, whether voluntarily or involuntarily.
(c) Repurchase Price . The Repurchase Price for any Issued Shares being repurchased hereunder shall be, subject to adjustment as provided in the Plan the Per Share Purchase Price.
(d) The closing of the purchase of the Shares pursuant to the Repurchase Right shall take place on the date designated by the Company in the Repurchase Notice, which date shall be not more than 30 days but not less than five days after the delivery of such notice. The Company will pay for the Shares to be purchased by it pursuant to the Repurchase Right by first offsetting amounts outstanding under any bona fide debts for money borrowed from the Company or for travel and expense advances owed by the Grantee to the Company; upon full repayment of such bona fide debts, the Company will make payment by (i) a check or wire
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transfer of funds in the aggregate amount of the remaining purchase price for such Shares or (ii) in the event that the Board determines that a cash payment would breach, violate or constitute a default under any statute, regulation, contract or agreement to which the Company is a party or is subject or would otherwise be materially injurious to the Company, then by delivery of a subordinated note in the aggregate amount of the remaining purchase price for such Shares payable in equal annual installments on the first, second and third anniversaries of the closing of the purchase of the Shares and accruing interest at the applicable federal rate (which shall be payable upon payment of the principal amount of such note, which note shall be prepayable in full or in part at any time without penalty or premium). The Company will be entitled to receive customary representations and warranties from the sellers regarding such sale and to require all sellers signatures be guaranteed.
(e) The repurchase of the Shares by the Company shall be subject to the applicable restrictions contained in the Delaware General Corporation Law and in the Companys and its Subsidiaries debt and equity financing agreements. If any such restrictions prohibit the purchase of the Shares which the Company is otherwise entitled to make, the Company may, notwithstanding anything in this Agreement to the contrary, delay any such purchases until such time as it is permitted to do so under the restrictions.
4. | Restrictions on Transfer of Shares . |
(a) Restrictions on Transfer; Repurchase . The Restricted Shares are restricted in that they may not be sold, transferred or otherwise alienated or hypothecated until these restrictions are removed or expire as described in Section 1 of this Agreement. The Restricted Shares are also restricted in the sense that they may be subject to repurchase by the Company as described in Section 3 of this Agreement.
(b) Compliance with Securities Law . Notwithstanding any provision of this Agreement to the contrary, the issuance of Shares (including Restricted Shares) will be subject to compliance with all applicable requirements of federal, state, or foreign law with respect to such securities and with the requirements of any stock exchange or market system upon which the Shares may then be listed. No Shares will be issued hereunder if such issuance would constitute a violation of any applicable federal, state, or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Shares may then be listed. In addition, Shares will not be issued hereunder unless (a) a registration statement under the Securities Act of 1933, as amended (the Securities Act) is at the time of issuance in effect with respect to the Shares issued or (b) in the opinion of legal counsel to the Company, the Shares issued may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Companys legal counsel to be necessary to the lawful issuance and sale of any Shares subject to this Agreement will relieve the Company of any liability in respect of the failure to issue such Shares as to which such requisite authority has not been obtained. As a condition to any issuance hereunder, the Company may require you to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect to such compliance as may be requested by the Company. From time to time, the Board and appropriate officers of the Company are authorized to take the actions necessary and appropriate to file required documents with governmental authorities, stock exchanges, and other appropriate Persons to make Shares available for issuance.
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5. Legend . Any certificate(s) representing the Shares shall carry substantially the following legend:
THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE RESTRICTIONS, TERMS AND CONDITIONS (INCLUDING REPURCHASE AND RESTRICTIONS AGAINST TRANSFERS) CONTAINED IN A CERTAIN RESTRICTED STOCK AGREEMENT DATED , 20 BETWEEN THE COMPANY AND THE HOLDER OF THIS CERTIFICATE (A COPY OF WHICH IS AVAILABLE AT THE OFFICES OF THE COMPANY FOR EXAMINATION).
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE. THE SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION FROM REGISTRATION.
6. | Escrow Arrangement . |
(a) Escrow . In order to carry out the provisions of Sections 3 and 4 of this Agreement more effectively, the Company shall hold the Shares in escrow together with separate stock powers executed by the Grantee in blank for transfer as an additional condition to any transfer of Shares, execute a like stock power as to such Shares. The Company shall not dispose of the Shares except as otherwise provided in this Agreement. In the event of any repurchase by the Company (or any of its assigns), the Company is hereby authorized by the Grantee, as the Grantees attorney-in-fact, to date and complete the stock powers necessary for the transfer of the Shares being purchased and to transfer such Shares in accordance with the terms hereof. At such time as any Shares are no longer subject to the Companys repurchase rights and the transfer restrictions, the Company shall, at the written request of the Grantee, deliver to the Grantee a certificate representing such Shares with the balance of the Shares (if any) to be held in escrow pursuant to this Section 6.
(b) Remedy . Without limitation of any other provision of this Agreement or other rights, in the event that the Grantee or any other person or entity is required to sell the Grantees Shares pursuant to the provisions of Sections 3 and 4 of this Agreement and in the further event that he or she refuses or for any reason fails to deliver to the designated purchaser of such Shares the certificate or certificates evidencing such Shares together with a related stock power, such designated purchaser may deposit the applicable purchase price for such Shares with a bank designated by the Company, or with the Companys independent public accounting firm, as agent or trustee, or in escrow, for the Grantee or other person or entity, to be held by such
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bank or accounting firm for the benefit of and for delivery to him, her, them or it, and/or, in its discretion, pay such purchase price by offsetting any indebtedness then owed by the Grantee as provided above. Upon any such deposit and/or offset by the designated purchaser of such amount and upon notice to the person or entity who was required to sell the Shares to be sold pursuant to the provisions of Sections 3 and 4, such Shares shall at such time be deemed to have been sold, assigned, transferred and conveyed to such purchaser, the holder thereof shall have no further rights thereto (other than the right to withdraw the payment thereof held in escrow, if applicable), and the Company shall record such transfer in its stock transfer book or in any appropriate manner.
7. Withholding Taxes . The Grantee acknowledges and agrees that the Company or any of its Subsidiaries have the right to deduct from payments of any kind otherwise due to the Grantee, or from the Shares held pursuant to Section 6 hereof, up to the maximum rate (with respect to the Grantee) of federal, state or local taxes of any kind. In furtherance of the foregoing the Grantee agrees to elect, in accordance with Section 83(b) of the Internal Revenue Code of 1986, as amended, to recognize ordinary income in the year of acquisition of the Shares, and to pay to the Company all withholding taxes shown as due on his or her Section 83(b) election form, or otherwise ultimately determined to be due with respect to such election, based on the excess, if any, of the fair market value of such Shares as of the date of the purchase of such Shares by the Grantee over the purchase price for such Shares. The Grantee represents that he has received tax advice from his own personal tax advisor on the consequences of the purchase of the Shares. The Grantee understands the tax consequences of filing (or not filing) a Section 83(b) election and agrees that any filing of a Section 83(b) election is solely the Grantees responsibility.
8. Assignment . At the discretion of the Board, the Company shall have the right to assign the right to exercise its rights with respect to the Repurchase Right or pursuant to Section 3 to any Person or Persons, in whole or in part in any particular instance, upon the same terms and conditions applicable to the exercise thereof by the Company, and such assignee or assignees of the Company shall then take and hold any Shares so acquired subject to such terms as may be specified by the Company in connection with any such assignment.
9. | Miscellaneous Provisions . |
(a) Lockup provision . The Grantee agrees, if requested by the Company and any underwriter engaged by the Company, not to sell or otherwise transfer or dispose of any securities of the Company (including, without limitation pursuant to Rule 144 under the Securities Act) held by him or her for (a) 180 days following the effective date of the relevant registration statement filed under the Securities Act in connection with the Companys Initial Public Offering, or (b) 90 days following the effective date of the relevant registration statement in connection with any other public offering of Common Stock, as the Company and such underwriter shall specify reasonably and in good faith. Notwithstanding the foregoing, if: (x) during the last 17 days of the foregoing 180-day period or 90-day period, as applicable, the Company issues an earnings release or material news or a material event relating to the Company occurs; or (y) prior to the expiration of the 180-day period or 90-day period, as applicable, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the period, then the restrictions described above shall continue to apply until the
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expiration of any 18-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event. The Grantee agrees, if requested by the underwriter engaged by the Company, to execute a separate letter reflecting the agreement set forth in this Section 9(a).
(b) Record Owner; Dividends . The Grantee, during the duration of this Agreement, shall be considered the record owner of and shall be entitled to vote the Shares if and to the extent the Shares are entitled to voting rights. The Grantee shall be entitled to receive all dividends and any other distributions declared on the Shares; provided , however , that the Company is under no duty to declare any such dividends or to make any such distribution.
(c) Equitable Relief . The parties hereto agree and declare that legal remedies are inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.
(d) Change and Modifications . This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Grantee.
(e) Governing Law . This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.
(f) Headings . The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.
(g) Saving Clause . If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.
(h) Notices . All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Grantee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other. Notices to any holder of the Shares other than the Grantee shall be addressed to the address furnished by such holder to the Company.
(i) Benefit and Binding Effect . This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, assigns, and legal representatives. Without limitation of the foregoing, upon any stock-for-stock merger in which the Company is not the surviving entity, shares of the Companys successor issued in respect of the Shares shall remain subject to vesting and, if such successor does not have any class of equity securities registered pursuant to Sections 12 or 15 of the Securities Exchange Act of 1934, subject to the Repurchase Right, restrictions on transfer, and the lock-up provision. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.
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(j) Dispute Resolution . Except as provided below, any dispute arising out of or relating to this Agreement or the breach, termination or validity hereof shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the J.A.M.S. Rules). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. §§1-16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof. The place of arbitration shall be Austin, Texas.
The parties covenant and agree that the arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a partys witness or expert. The arbitrators decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrators decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages or any other damages that are specifically excluded under this Agreement, and each party hereby irrevocably waives any claim to such damages.
The parties covenant and agree that they will participate in the arbitration in good faith. This Section 9(j) applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.
Each of the parties hereto (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each of the parties hereto hereby consents to service of process by registered mail at the address to which notices are to be given. Each of the parties hereto agrees that its, his or her submission to
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jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of the other parties hereto. Final judgment against any party hereto in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.
(k) Counterparts . For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Company and the Grantee have executed this Restricted Stock Agreement as of the date first above written.
SAILPOINT TECHNOLOGIES HOLDINGS, INC. | ||
By: |
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Name: | ||
Title: | ||
Address: | ||
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GRANTEE: | ||
Name: Howard Greenfield |
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SPOUSES CONSENT
I acknowledge that I have read the
foregoing Restricted Stock Agreement
and understand the contents thereof.
Section 83(b) Election
The undersigned hereby elects pursuant to §83(b) of the Internal Revenue Code of 1986, as amended, to include in gross income as compensation for services the excess (if any) of the fair market value of the shares described below over the amount paid for those shares.
1. | The name, taxpayer identification number, address of the undersigned, and the taxable year for which this election is being made are: |
Taxpayers Name:
Taxpayers Social Security Number:
Address:
Taxable Year: Calendar Year 20__
2. | The property which is the subject of this election is shares of common stock of SailPoint Technologies Holdings, Inc., a Delaware corporation. |
3. | The property was transferred to the undersigned on [ ]. |
4. | The property is subject to the following restrictions: |
The Shares will be subject to restrictions on transfer and risk of forfeiture upon termination of service relationship and in certain other events.
5. | The fair market value of the property at time of transfer (determined without regard to any restrictions other than nonlapse restrictions as defined in §1.83-3(h) of the Income Tax Regulations) is $ per share x shares = $ . |
6. | For the property transferred, the undersigned paid $ per share x shares = $ . |
7. | The amount to include in gross income is $ . |
The undersigned taxpayer will file this election with the Internal Revenue Service Office with which the taxpayer files his or her annual income tax return not later than 30 days after the date of transfer of the property. A copy of the election will also be furnished to the person for whom the services were performed. Additionally, the undersigned will include a copy of the election with his or her income tax return for the taxable year in which the property is transferred. The undersigned is the person performing services in connection with which the property was transferred.
Dated: , 20 |
Taxpayer |
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