Exhibit 10.1

Execution Version

AMPLIFY ENERGY CORP.

AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT

This Amended and Restated Registration Rights Agreement (this “ Agreement ”) is made and entered into as of August 6, 2019, by and among (i) Amplify Energy Corp., a Delaware corporation (f/k/a Midstates Petroleum Company, Inc., a Delaware corporation) (the “ Company ”) and (ii) the Holders (as defined below) of Company Common Stock (as defined below) listed on Schedule I hereto. The Company and the Holders are referred to collectively herein as the “ Parties ”.

WITNESSETH:

WHEREAS, the Company entered into that certain Registration Rights Agreement, dated as of October 21, 2016 (the “ Initial RRA ”);

WHEREAS, upon the terms and subject to the conditions of that certain Agreement and Plan of Merger dated as of May 5, 2019, by and among the Company, Midstates Holdings, Inc., a direct wholly owned subsidiary of the Company and Amplify Energy Corp., a Delaware corporation (“ Legacy Amplify ”), the Company agreed to issue to the holders of common stock, par value $0.0001 per share, of Legacy Amplify (“ Legacy Amplify Common Stock ”) 0.933 shares of common stock, par value $0.01 per share, of the Company (“ Company Common Stock ”) for each share of Legacy Amplify Common Stock;

WHEREAS, the Company and the Holders desire to execute and deliver this Agreement in order for the Company to grant certain registration and other rights to the Holders by amending the Initial RRA on the terms and subject to the conditions set forth in this Agreement;

WHEREAS, each Holder is on the date hereof the holder of the number of shares of Company Common Stock as set forth on Schedule I hereto;

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by each Party, the Parties agree as follows:

1. Definitions . As used in this Agreement, the following terms shall have the respective meanings set forth in this Section 1:

“ Affiliate ” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, such Person (including any investment fund the primary investment advisor to which is such Person or an Affiliate thereof); provided that for purposes of this Agreement, no Holder shall be deemed an Affiliate of any other securityholder solely by reason of any investment in the Company. For purposes of this definition, the term “ control ” (including the correlative meanings of the terms “ controlling ,” “ controlled by ” and “ under common control with ”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

“ Agreement ” has the meaning set forth in the preamble.

“ Alternative Transaction ” means the sale of Registrable Securities constituting more than 3% of the shares of Company Common Stock outstanding at the time of such sale to one or more purchasers in a registered transaction without a prior marketing process by means of (a) a bought deal, (b) a block trade, (c) a direct sale or (d) any other transaction that is registered pursuant to a Shelf Registration that is not a firm commitment underwritten offering.

“ Automatic Shelf Registration Statement ” means an “automatic shelf registration statement” as defined in Rule 405.

“ beneficially owned ”, “ beneficial ownership ” and similar phrases have the same meanings as such terms have under Rule 13d-3 (or any successor rule then in effect) under the Exchange Act, except that in calculating the beneficial ownership of any Holder, such Holder shall be deemed to have beneficial ownership of all securities that such Holder has the right to acquire, whether such right is currently exercisable or is exercisable upon the occurrence of a subsequent event. For the avoidance of doubt, each Holder shall be deemed to beneficially own all of the shares of Company Common Stock held by any of its Affiliates.

“ Business Day ” means any day that is not a Saturday, a Sunday or other day on which banks are required or authorized by law to be closed in New York, New York.

“ Commission ” means the Securities and Exchange Commission or any other federal agency then administering the Securities Act or Exchange Act.

“ Company ” has the meaning set forth in the preamble.

“ Company Common Stock ” has the meaning set forth in the recitals.

“ Company Notice ” has the meaning set forth in Section  2(a)(iii) .

“ Demand Eligible Holder ” has the meaning set forth in Section 2(b)(i).

“ Demand Eligible Holder Request ” has the meaning set forth in Section 2(b)(i).

“ Demand Notice ” has the meaning set forth in Section  2(b)(i) .

“ Demand Registration ” has the meaning set forth in Section  2(b)(i) .

“ Demand Registration Statement ” has the meaning set forth in Section 2(b)(i).

“ Determination Date ” has the meaning set forth in Section 2(a)(viii).

“ Effectiveness Period ” has the meaning set forth in Section 2(b)(iii).

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ Family Member ” shall mean, with respect to any natural Person, such Person’s parents, spouse (but not including a former spouse or a spouse from whom such Person is legally separated) and descendants (whether or not adopted) and any trust, family limited partnership or limited liability company that is and remains solely for the benefit of such Person’s spouse (but not including a former spouse or a spouse from whom such Person is legally separated) and/or descendants.

 

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“ FINRA ” means the Financial Industry Regulatory Authority.

“ Form  S-1 Shelf ” has the meaning set forth in Section  2(a)(i) .

“ Form  S-3 Shelf ” has the meaning set forth in Section  2(a)(i) .

“ Holder ” means each Person that is party to this Agreement on the date hereof and any Person who hereafter becomes a party to this Agreement pursuant to Section 8(f) of this Agreement. A Person shall cease to be a Holder hereunder at such time as it ceases to hold any Registrable Securities.

“ Holders of a Majority of Included Registrable Securities ” means Holders of a majority of the Registrable Securities included in the Registration Statement.

“ Indemnified Persons ” has the meaning set forth in Section  6(a) .

“ Issuer Free Writing Prospectus ” means an issuer free writing prospectus, as defined in Rule 433, relating to an offer of the Registrable Securities.

“ Legacy Amplify ” has the meaning set forth in the recitals.

“ Legacy Amplify Common Stock ” has the meaning set forth in the recitals.

“ Losses ” has the meaning set forth in Section  6(a) .

“ Maximum Offering Size ” has the meaning set forth in Section 2(a)(iv).

“ Other Registrable Securities ” means (a) Company Common Stock, (b) any securities issued or issuable with respect to, on account of or in exchange for Company Common Stock, whether by stock split, stock dividend, recapitalization, merger, consolidation or other reorganization, charter amendment or otherwise and (c) any options, warrants or other rights to acquire, and any securities received as a dividend or distribution in respect of, any of the securities described in clauses (a) and (b) above, in each case held by any other Person who has rights to participate in any offering of securities by the Company pursuant to a registration rights agreement or other similar arrangement with the Company or any direct or indirect parent of the Company relating to the Company Common Stock or warrants (other than this Agreement).

“ Parties ” has the meaning set forth in the preamble.

“ Person ” means any individual, partnership, corporation, company, association, trust, joint venture, limited liability company, unincorporated organization, entity or division, or any government, governmental department or agency or political subdivision thereof.

“ Piggyback Eligible Holders ” has the meaning set forth in Section 2(c)(i).

“ Piggyback Notice ” has the meaning set forth in Section  2(c)(i) .

 

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“ Piggyback Registration ” has the meaning set forth in Section 2(c)(i).

“ Piggyback Registration Statement ” has the meaning set forth in Section 2(c)(i).

“ Piggyback Request ” has the meaning set forth in Section  2(c)(i) .

“ Plan ” has the meaning set forth in the recitals.

“ Proceeding ” means any action, claim, suit, proceeding or investigation (including a preliminary investigation or partial proceeding, such as a deposition) pending or known to the Company to be threatened.

“ Prospectus ” means the prospectus included in a Registration Statement (including a prospectus that includes any information previously omitted from a prospectus filed as part of an effective Registration Statement in reliance upon Rule 430A promulgated under the Securities Act), all amendments and supplements to the Prospectus, including post-effective amendments, all material incorporated by reference or deemed to be incorporated by reference in such Prospectus and any Issuer Free Writing Prospectus.

“ Public Offering ” means any sale of shares of Company Common Stock to the public pursuant to a public offering registered (other than a registration effected solely to implement an employee benefit plan or a transaction to which Rule 145 is applicable) under the Securities Act.

“ Qualified Holder ” means, on any date, one or more Holders who beneficially own in the aggregate 7% or more of the Company Common Stock outstanding on such date.

“ Registrable Securities ” means (a) any Company Common Stock, (b) any securities issued or issuable with respect to, on account of or in exchange for Company Common Stock, whether by stock split, stock dividend, recapitalization, merger, consolidation or other reorganization, charter amendment or otherwise and (c) any options, warrants or other rights to acquire, and any securities received as a dividend or distribution in respect of, any of the securities described in clauses (a) and (b) above, in each case that are held on or after the date hereof by the Holders and their Affiliates or any transferee or assignee of any Holder or its Affiliates after giving effect to a transfer made in compliance with Section  8(f) , all of which securities are subject to the rights provided herein until such rights terminate pursuant to the provisions of this Agreement. As to any particular Registrable Securities, such securities shall not be Registrable Securities when (i) a Registration Statement registering such Registrable Securities under the Securities Act has been declared effective and such Registrable Securities have been sold, transferred or otherwise disposed of by the Holder thereof pursuant to such effective Registration Statement, (ii) such Registrable Securities are sold, transferred or otherwise disposed of pursuant to Rule 144, (iii) such securities cease to be outstanding, or (iv) such securities are held by a Holder who, together with its Affiliates, holds less than 1% of the then outstanding Company Common Stock and all such securities may be sold pursuant to Rule 144 without regard to volume or manner of sale limitations and without the requirement to be in compliance with Rule 144(c)(1).

“ Registration Expenses ” has the meaning set forth in Section  5 .

 

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“ Registration Statement ” means a registration statement of the Company filed with or to be filed with the Commission under the Securities Act and other applicable law, including an Automatic Shelf Registration Statement, and including any Prospectus, amendments and supplements to each such registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated by reference or deemed to be incorporated by reference in such registration statement.

“ Related Party ” has the meaning set forth in Section  8(p) .

“ Representatives ” means, with respect to any Person, such Person’s directors, officers, members, partners, limited partners, general partners, shareholders, managers, management company, investment manager, affiliates, employees, agents, investment bankers, attorneys, accountants, advisors, financial advisor and other professionals of such Person, in each case, in such capacity, serving on or after the date of this Agreement.

“ Rule  144 ” means Rule 144 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

“ Rule  145 ” means Rule 145 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

“ Rule  158 ” means Rule 158 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

“ Rule  405 ” means Rule 405 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

“ Rule  424 ” means Rule 424 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

“ Rule  433 ” means Rule 433 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

“ Seasoned Issuer ” means an issuer eligible to use Form S-3 under the Securities Act and who is not an “ineligible issuer” as defined in Rule 405.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Selling Expenses ” means all underwriting fees, discounts, selling commissions and stock transfer taxes applicable to the sale of Registrable Securities and related legal and other fees of a Holder not included within the definition of Registration Expenses.

 

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“ Shelf Period ” has the meaning set forth in Section  2(a)(i) .

“ Shelf Public Offering Requesting Holder ” has the meaning set forth in Section 2(a)(ii).

“ Shelf Registration ” means the registration of an offering of Registrable Securities on a Form S-1 Shelf or a Form S-3 Shelf, as applicable, on a delayed or continuous basis under Rule 415 under the Securities Act, pursuant to Section  2(a)(i) .

“ Shelf Registration Statement ” has the meaning set forth in Section 2(a)(i).

“ Shelf Takedown Notice ” has the meaning set forth in Section 2(a)(iii).

“ Subsidiary ” means, when used with respect to any Person, any corporation or other entity, whether incorporated or unincorporated, (a) of which such Person or any other Subsidiary of such Person is a general partner (excluding partnerships, the general partnership interests of which held by such Person or any Subsidiary of such Person do not have a majority of the voting interests in such partnership) or (b) at least a majority of the securities or other interests of which having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions with respect to such corporation or other entity is directly or indirectly owned or controlled by such Person or by any one or more of its Subsidiaries, or by such Person and one or more of its Subsidiaries.

“ Suspension Period ” has the meaning set forth in Section  2(e) .

“ Trading Market ” means the principal national securities exchange in the United States on which Registrable Securities are (or are to be) listed.

“ Underwritten Shelf Takedown ” has the meaning set forth in Section 2(a)(ii).

“ WKSI ” means a “well known seasoned issuer” as defined under Rule 405 and which (i) is a “well-known seasoned issuer” under paragraph (1)(i)(A) of such definition or (ii) is a “well-known seasoned issuer” under paragraph (1)(i)(B) of such definition and is also a Seasoned Issuer.

“ WKSI Date ” has the meaning set forth in Section  2(a)(viii) .

Unless the context requires otherwise: (a) any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms; (b) references to Sections, paragraphs and clauses refer to Sections, paragraphs and clauses of this Agreement; (c) the terms “ include ,” “ includes ,” “ including ” or words of like import shall be deemed to be followed by the words “without limitation”; (d) the terms “ hereof ,” “ herein ” or “ hereunder ” refer to this Agreement as a whole and not to any particular provision of this Agreement; (e) unless the context otherwise requires, the term “or” is not exclusive and shall have the inclusive meaning of “and/or”; (f) defined terms herein will apply equally to both the singular and plural forms and derivative forms of defined terms will have correlative meanings; (g) references to any law or statute shall be deemed to refer to such law or statute as amended or supplemented from time to time and shall include all rules and regulations and forms promulgated thereunder, and references to any law, rule, form or statute shall be construed as including any legal and statutory provisions, rules or forms consolidating, amending, succeeding or replacing the applicable law, rule, form or statute;

 

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(h) references to any agreement or contract are to that agreement or contract as amended, modified or supplemented from time to time in accordance with the terms hereof and thereof; (i) references to any Person include such Person’s successors and permitted assigns; (j) references to “days” are to calendar days unless otherwise indicated; and (k) references to “writing”, “written” and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible form. Each of the parties hereto acknowledges that each party was actively involved in the negotiation and drafting of this Agreement and that no law or rule of construction shall be raised or used in which the provisions of this Agreement shall be construed in favor or against any party hereto because one is deemed to be the author thereof.

2. Registration .

(a) Shelf Registration.

(i) Filing of Shelf Registration Statement . No later than 90 days after the date hereof, the Company shall file a Registration Statement for a Shelf Registration on Form S-3 covering the resale of all of the Registrable Securities held by the Holders to the extent not already registered for resale by such Holders on an effective Registration Statement on a delayed or continuous basis (the “ Form  S-3 Shelf ”). If the Company is not a Seasoned Issuer or WKSI at the time of filing, the Company shall instead file such Registration Statement for a Shelf Registration on Form S-1 (the “ Form  S-1 Shelf ” and, together with the Form S-3 Shelf, the “ Shelf Registration Statement ”). In the event that the Company files such Shelf Registration Statement on a Form S-1 Shelf and thereafter becomes a Seasoned Issuer or WKSI, the Company shall use its commercially reasonable efforts to convert the Form S-1 Shelf to a Form S-3 Shelf (which shall be an Automatic Shelf Registration Statement if the Company is a WKSI) as soon as practicable after the Company becomes so eligible. Subject to the terms of this Agreement, including any applicable Suspension Period, the Company shall cause the Shelf Registration Statement to be declared effective under the Securities Act no later than the 10th day following the filing of the Shelf Registration Statement in the event of no “review” by the Commission, or in the event of a “limited review” or “review” by the Commission, the Company shall use its commercially reasonable efforts to cause such Shelf Registration Statement to be declared effective under the Securities Act as promptly as possible after the filing thereof, including using commercially reasonable efforts to cause such Shelf Registration Statement to be declared effective (x) no later than the 40th day following such filing in the event of “limited review” by the Commission or (y) no later than the 60th day following such filing in the event of a “review” by the Commission, and shall use its commercially reasonable efforts to keep such Shelf Registration Statement continuously effective under the Securities Act until the date that all Registrable Securities covered by such Registration Statement are no longer Registrable Securities, including, to the extent a Form S-1 Shelf was converted to a Form S-3 Shelf and the Company thereafter became ineligible to use Form S-3, by filing a Form S-1 Shelf not later than 10 Business Days after the date of such ineligibility and using its commercially reasonable efforts to have such Registration Statement declared effective as promptly as practicable (but in no event more than

 

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20 days after the date of such filing) (the period during which the Company shall use its commercially reasonable efforts to keep the Shelf Registration Statement continuously effective under the Securities Act in accordance with this clause (i), the “ Shelf Period ”). The Company shall notify the Holders named in any Shelf Registration Statement via facsimile or by e-mail of the effectiveness of a Form S-1 Shelf on the same Business Day that the Company telephonically confirms effectiveness with the Commission. The Company shall file a final Prospectus with the Commission to the extent required by Rule 424. The “Plan of Distribution” section of such Shelf Registration Statement shall provide for all permitted means of disposition of Registrable Securities reasonably requested to be included by the Holders named therein, including firm-commitment underwritten public offerings, Alternative Transactions, agented transactions, sales directly into the market, purchases or sales by brokers and sales not involving a public offering.

(ii) Underwritten Shelf Takedown . At any time during the Shelf Period (subject to any Suspension Period), any one or more Holders of Registrable Securities (such Holder, a “ Shelf Public Offering Requesting Holder ”) may request to sell all or any portion of their Registrable Securities in an underwritten offering that is registered pursuant to any Shelf Registration Statement (each, an “ Underwritten Shelf Takedown ”); provided , that, and subject to Section  2(a)(v)  below, the Company shall not be obligated to effect (x) more than four Underwritten Shelf Takedowns in any 12-month period for all Holders and (y) any Underwritten Shelf Takedown if the aggregate proceeds expected to be received from the sale of the Registrable Securities requested to be sold in such Underwritten Shelf Takedown, in the good faith judgment of the managing underwriter(s) therefor, is less than $25 million (unless an Underwritten Shelf Takedowns contemplates to register for resale all remaining Registrable Securities and the aggregate proceeds expected to be received from the sale thereof is less than $25 million).

(iii) Notice of Underwritten Shelf Takedown . All requests for Underwritten Shelf Takedowns shall be made by giving written notice to the Company (the “ Shelf Takedown Notice ”). Each Shelf Takedown Notice shall specify the class or series and the approximate number of Registrable Securities to be sold in the Underwritten Shelf Takedown and the expected price range (net of underwriting discounts and commissions) of such Underwritten Shelf Takedown. Subject to Section  2(e)  below, within three days after receipt of any Shelf Takedown Notice, the Company shall give written notice of such requested Underwritten Shelf Takedown (which notice shall state the material terms of such proposed Underwritten Shelf Takedown, to the extent known, as well as the identity of the Shelf Public Offering Requesting Holder) to all other Holders of Registrable Securities (the “ Company Notice ”) and, subject to the provisions of Section  2(a)(iv)  and Section  2(e)  below, shall include in such Underwritten Shelf Takedown all Registrable Securities of the same class or series as the Registrable Securities originally requested to be sold by the Shelf Public Offering Requesting Holder with respect to which the Company has received written requests for inclusion therein within five Business Days after giving the Company Notice; provided that any such Registrable Securities shall be sold subject to the same terms as are applicable to the Registrable Securities the Shelf Public Offering Requesting Holder is requesting to sell.

 

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(iv) Priority of Registrable Shares . If the managing underwriters for such Underwritten Shelf Takedown advise the Company and the Holders of Registrable Securities proposed to be included in such Underwritten Shelf Takedown that in their reasonable view the number of Registrable Securities proposed to be included in such Underwritten Shelf Takedown exceeds the number of Registrable Securities which can be sold in an orderly manner in such offering within a price range acceptable to the Holders of a Majority of Included Registrable Securities requested to be included in the Underwritten Shelf Takedown (the “ Maximum Offering Size ”), then the Company shall so advise all Holders of Registrable Securities proposed to be included in such Underwritten Shelf Takedown, and shall include in such Underwritten Shelf Takedown the number of Registrable Securities which can be so sold in the following order of priority, up to the Maximum Offering Size: (A) first, pro rata among the Holders of such Registrable Securities on the basis of the number of Registrable Securities requested to be included therein by each such Holder, (B) second, any securities requested to be included in such Underwritten Shelf Takedown by the Company and (C) third, Other Registrable Securities requested to be included in such Underwritten Shelf Takedown to the extent permitted hereunder, allocated, if necessary for the offering not to exceed the Maximum Offering Size, pro rata among the respective holders of such Other Registrable Securities on the basis of the number of securities requested to be included therein by each such holder.

(v) Timing of Underwritten Shelf Takedowns . The Company shall not be obligated to effect an Underwritten Shelf Takedown within 90 days (or such shorter period specified in any applicable lock-up agreement entered into with underwriters) after the consummation of a previous Underwritten Shelf Takedown.

(vi) Selection of Bankers and Counsel . The Holders of a Majority of Included Registrable Securities requested to be included in an Underwritten Shelf Takedown shall have the right to select the investment banker(s) and manager(s) to administer the offering (which shall consist of one or more reputable nationally recognized investment banks, subject to the Company’s approval (which shall not be unreasonably withheld, conditioned or delayed)) and one firm of counsel to represent all of the Holders (along with any reasonably necessary local counsel), in connection with such Underwritten Shelf Takedown; provided that the Company shall select such investment banker(s), manager(s) and counsel (including local counsel) if such Holders of such Majority of Registrable Securities cannot so agree on the same within a reasonable time period.

(vii) Withdrawal from Registration . Any Holder whose Registrable Securities were to be included in any such registration pursuant to Section  2(a)(ii)  may elect to withdraw any or all of its Registrable Securities therefrom, without liability to any of the other Holders and without prejudice to the rights of any such Holder or Holders to include Registrable Securities in any future registration (or registrations), by written notice to the Company delivered on or prior to the effective date of the relevant Underwritten Shelf Takedown.

 

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(viii) WKSI Filing . Upon the Company first becoming a WKSI (the “ WKSI Date ”), (A) the Company shall give written notice to all of the Holders who hold Registrable Securities as promptly as practicable but in no event later than 5 Business Days thereafter, and such notice shall describe, in reasonable detail, the basis on which the Company has become a WKSI, and (B) the Company shall, in accordance with the following sentence, register, under an Automatic Shelf Registration Statement, the sale of all outstanding Registrable Securities in accordance with the terms of this Agreement. The Company shall use its commercially reasonable efforts to file such Automatic Shelf Registration Statement as promptly as practicable, but in no event later than 10 days after the WKSI Date, and to cause such Automatic Shelf Registration Statement to remain effective thereafter until there are no longer any Registrable Securities; provided, that, the failure of the Company to remain a WKSI after the filing of such Automatic Shelf Registration Statement shall not be deemed to be a breach of its obligations hereunder. The Company shall give written notice of filing such Registration Statement to all of the Holders who hold Registrable Securities as promptly as practicable thereafter. At any time after the filing of an Automatic Shelf Registration Statement by the Company, if it is reasonably likely that the Company will no longer be a WKSI (the “ Determination Date ”), as promptly as practicable but in no event later than five days after such Determination Date, the Company shall (1) give written notice thereof to all of the Holders and (2) file a Form S-3 Shelf, unless the Company is not then eligible to use Form S-3, in which case it shall use Form S-1 Shelf (or a post-effective amendment converting the Automatic Shelf Registration Statement to an appropriate form), covering all Registrable Securities, and cause such Registration Statement to be declared effective under the Securities Act no later than the 10th day following the filing of the Registration Statement in the event of no “review” by the Commission, or in the event of a “limited review” or “review” by the Commission, use its commercially reasonable efforts to cause such Registration Statement to be declared effective under the Securities Act as promptly as possible after the date the Automatic Shelf Registration Statement is no longer useable by the Holders to sell their Registrable Securities, including using commercially reasonable efforts to cause such Registration Statement to be declared effective (x) no later than the 40th day following such filing in the event of “limited review” by the Commission or (y) no later than the 60th day following such filing in the event of a “review” by the Commission, and keep such Registration Statement continuously effective under the Securities Act until there are no longer any Registrable Securities.

(ix) Adding Holders to Registration Statement . After the Registration Statement with respect to a Shelf Registration is declared or becomes effective but subject to a Suspension Period, upon written request by one or more Holders (which written request shall specify the amount of such Holders’ Registrable Securities to be registered), the Company shall, as promptly as practicable after receiving such

 

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request, (i) if it is a Seasoned Issuer or a WKSI, or if such Registration Statement is an Automatic Shelf Registration Statement, file a Prospectus supplement to include such Holders as selling stockholders in such Registration Statement or (ii) if it is not a Seasoned Issuer or a WKSI, file a post-effective amendment to the Registration Statement to include such Holders in such Shelf Registration and use commercially reasonable efforts to have such post-effective amendment declared effective.

(b) Demand Registration.

(i) Subject to the terms and conditions of this Agreement, at any time and from time to time after the date that is 90 days after the date hereof, upon written notice to the Company (a “ Demand Notice ”) delivered by one or more Qualified Holders requesting that the Company effect the registration (a “ Demand Registration ”) under the Securities Act (other than pursuant to a registration statement on Form S-4 or Form S-8 or any similar or successor form under the Securities Act) of any or all of the Registrable Securities held by such Qualified Holder(s) which offering is expected to yield aggregate gross proceeds of at least $25 million or, if the expected gross proceeds of the sale of all remaining Registrable Securities is less than $25 million, then such registration shall include all remaining Registrable Securities, the Company shall promptly (but in any event, not later than five Business Days following the Company’s receipt of such Demand Notice) give written notice of the receipt of such Demand Notice to all other Holders that, to its knowledge, hold Registrable Securities (each, a “ Demand Eligible Holder ”). The Company shall promptly file the appropriate Registration Statement (the “ Demand Registration Statement ”) and use its commercially reasonable efforts to effect, at the earliest practicable date, the registration under the Securities Act and under the applicable state securities laws of (A) the Registrable Securities which the Company has been so requested to register by the Qualified Holder(s) in the Demand Notice, (B) all other Registrable Securities of the same class or series as those requested to be registered by the Qualified Holder(s) which the Company has been requested to register by the Demand Eligible Holders by written request (the “ Demand Eligible Holder Request ”) given to the Company within five Business Days after the giving of such written notice by the Company, and (C) any Registrable Securities to be offered and sold by the Company, in each case subject to Section  2(b)(ii) , all to the extent required to permit the disposition (in accordance with the intended methods of disposition) of the Registrable Securities to be so registered. The Holders’ rights to request a Demand Registration set forth in this Section  2(b)  shall not be exercisable at any time if the Company (i) (x) is not in violation of its obligations to file a Shelf Registration Statement pursuant to Section  2(a)  or (y) has a currently effective Shelf Registration Statement covering all Registrable Securities in accordance with Section  2(a) , and (ii) has otherwise complied with its obligations pursuant to this Agreement.

 

 

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(ii) Demand Registration Using Form  S-3 . The Company shall effect any requested Demand Registration using Form S-3 whenever the Company is a Seasoned Issuer or a WKSI, and shall use an Automatic Shelf Registration Statement if it is a WKSI. Subject to the terms and conditions of this Agreement, for so long as the Company remains a Seasoned Issuer or a WKSI, the Qualified Holders shall have the right to cause the Company to effect no more than two Demand Registrations in any six month period and any request for a Demand Registration must be expected to yield aggregate gross proceeds of at least $25 million or such lesser amount resulting from the sale of all remaining Registrable Securities.

(iii) Effectiveness of Demand Registration Statement . The Company shall use its commercially reasonable efforts to have the Demand Registration Statement declared effective by the Commission and keep the Demand Registration Statement continuously effective under the Securities Act for the period of time necessary for the underwriters or Holders to sell all the Registrable Securities covered by such Demand Registration Statement or such shorter period which will terminate when all Registrable Securities covered by such Demand Registration Statement have been sold pursuant thereto (including, if necessary, by filing with the Commission a post-effective amendment or a supplement to the Demand Registration Statement or the related Prospectus or any document incorporated therein by reference or by filing any other required document or otherwise supplementing or amending the Demand Registration Statement, if required by the rules, regulations or instructions applicable to the registration form used by the Company for such Demand Registration Statement or by the Securities Act, any state securities or “blue sky” laws, or any other rules and regulations thereunder) (the “ Effectiveness Period ”). A Demand Registration requested pursuant to this Section  2(b)  shall not be deemed to have been effected (A) if the Registration Statement is withdrawn without becoming effective, (B) if the Registration Statement does not remain effective in compliance with the provisions of the Securities Act and the laws of any state or other jurisdiction applicable to the disposition of the Registrable Securities covered by such Registration Statement for the Effectiveness Period, (C) if, after it has become effective, such Registration Statement is subject to any stop order, injunction or other order or requirement of the Commission or other governmental or regulatory agency or court for any reason other than a violation of applicable law solely by any selling Holder and has not thereafter become effective, (D) in the event of an underwritten offering, if the conditions to closing specified in the underwriting agreement entered into in connection with such registration are not satisfied or waived other than by reason of some wrongful act or omission by a Qualified Holder, or (E) if the Company does not include in the applicable Registration Statement any Registrable Securities held by a Holder that are required by the terms hereof to be included in such Registration Statement.

(iv) Priority of Registration . Notwithstanding any other provision of this Section  2(b) , if (A) the Qualified Holder intends to distribute the Registrable Securities covered by a Demand Registration by means of an underwritten offering and (B) the managing underwriters advise the Company that in their reasonable view, the number of Registrable Securities proposed to be included in such offering

 

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(including Registrable Securities requested by Holders to be included in such offering and any securities that the Company or any other Person proposes to be included that are not Registrable Securities) exceeds the Maximum Offering Size, then the Company shall so advise the Qualified Holder and the Demand Eligible Holders with Registrable Securities proposed to be included in such underwritten offering, and shall include in such offering the number of Registrable Securities which can be so sold in the following order of priority, up to the Maximum Offering Size: (1)  first , the Registrable Securities requested to be included in such underwritten offering by the Qualified Holders and the Demand Eligible Holders, allocated, if necessary for the offering not to exceed the Maximum Offering Size, pro rata among the Qualified Holders and Demand Eligible Holders on the basis of the number of Registrable Securities requested to be included therein by each such Holder, (2)  second , any securities proposed to be registered by the Company, and (3)  third , Other Registrable Securities requested to be included in such underwritten offering to the extent permitted hereunder, allocated, if necessary for the offering not to exceed the Maximum Offering Size, pro rata among the respective holders of such Other Registrable Securities on the basis of the number of securities requested to be included therein by each such holder.

(v) Underwritten Demand Registration . The determination of whether any offering of Registrable Securities pursuant to a Demand Registration will be an underwritten offering shall be made in the sole discretion of the Holders of a Majority of Included Registrable Securities for such Registration Statement, and such Holders of a Majority of Included Registrable Securities shall have the right to (A) determine the plan of distribution, including the price at which the Registrable Securities are to be sold and the underwriting commissions, discounts and fees, and (B) select the investment banker(s) and manager(s) to administer the offering (which shall consist of one (1) or more reputable nationally recognized investment banks, subject to the Company’s approval (which shall not be unreasonably withheld, conditioned or delayed)) and one firm of counsel to represent all of the Holders (along with any reasonably necessary local counsel), in connection with such Demand Registration; provided that the Company shall select such investment banker(s), manager(s) and counsel (including local counsel) if the Holders of such Majority of Registrable Securities cannot so agree on the same within a reasonable time period; provided further , that the Company shall not be obligated to effect an underwritten offering pursuant to a Demand Registration within 90 days after the consummation of a previous underwritten offering pursuant to a Demand Registration or Underwritten Shelf Takedown.

(vi) Withdrawal of Registrable Securities . Any Holder whose Registrable Securities were to be included in any such registration pursuant to Section  2(b)  may elect to withdraw any or all of its Registrable Securities therefrom, without prejudice to the rights of any such Holder to include Registrable Securities in any future registration (or registrations), by written notice to the Company delivered on or prior to the effective date of the relevant Demand Registration Statement.

 

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(vii) Occurrence of Demand Registration . A Demand Registration shall not be deemed to have occurred (x) unless the Registration Statement relating thereto (A) has become effective under the Securities Act and (B) has remained continuously effective for a period of at least 180 days (or such shorter period in which all Registrable Securities of the Holders included in such registration have actually been sold thereunder); provided that such Registration Statement shall not be considered a Demand Registration if, after such Registration Statement becomes effective, (1) such Registration Statement is interfered with by any stop order, injunction or other order or requirement of the SEC or other governmental agency or court and (2) if such registration is pursuant to an underwritten offering, fewer than 75% of the Registrable Securities included in such Registration Statement have been sold thereunder; or (y) if the Maximum Offering Size is reduced in accordance with Section  2(b)(iv)  such that less than 66 ^{2 /3} % of the Registrable Securities of the Qualified Holders and the Demand Eligible Holders requested to be included in such registration are included.

(c) Piggyback Registration.

(i) Registration Statement on behalf of the Company . If at any time the Company proposes to file a Registration Statement, other than pursuant to a Shelf Registration under Section  2(a) , for an offering of Registrable Securities (for purposes of this section, irrespective of the holders thereof) for cash (excluding an offering relating solely to an employee benefit plan, an offering relating to a transaction on Form S-4, a rights offering or an offering on any form of Registration Statement that does not permit secondary sales) (a “ Piggyback Registration Statement ”), the Company shall give prompt written notice (the “ Piggyback Notice ”) to all Holders that, to its knowledge, hold Registrable Securities (collectively, the “ Piggyback Eligible Holders ”) of the Company’s intention to file a Piggyback Registration Statement reasonably in advance of (and in any event at least 5 Business Days before) the anticipated filing date of such Piggyback Registration Statement. The Piggyback Notice shall offer the Piggyback Eligible Holders the opportunity to include for registration in such Piggyback Registration Statement the number of Registrable Securities of the same class and series as those proposed to be registered as they may request, subject to Section  2(c)(ii)  (a “ Piggyback Registration ”). Subject to Section  2(c)(ii) , the Company shall use its commercially reasonable efforts to include in each such Piggyback Registration such Registrable Securities for which the Company has received written requests (each, a “ Piggyback Request ”) from Piggyback Eligible Holders within five Business Days after giving the Piggyback Notice. If a Piggyback Eligible Holder decides not to include all of its Registrable Securities in any Piggyback Registration Statement thereafter filed by the Company, such Piggyback Eligible Holder shall nevertheless continue to have the right to include any Registrable Securities in any subsequent Piggyback Registration Statements or Registration Statements as may be filed by the Company with respect to offerings of Registrable Securities, all upon the terms and conditions set forth herein. The Company shall use its commercially reasonable efforts to effect the registration under the Securities Act of all Registrable Securities which the Company has been so requested to register pursuant to the Piggyback Requests, to the extent required to permit the disposition of the Registrable Securities so requested to be registered.

 

 

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(ii) Priority of Registration . If the Piggyback Registration under which the Company gives notice pursuant to Section  2(c)(i)  is an underwritten offering, and the managing underwriter or managing underwriters of such offering advise the Company and the Piggyback Eligible Holders that, in their reasonable view the amount of securities requested to be included in such registration (including Registrable Securities requested by the Piggyback Eligible Holders to be included in such offering and any securities that the Company or any other Person proposes to be included that are not Registrable Securities) exceeds the Maximum Offering Size (which, for the purposes of a Piggyback Registration shall be within a price range acceptable to the Company), then the Company shall so advise all Piggyback Eligible Holders with Registrable Securities proposed to be included in such Piggyback Registration, and shall include in such offering the number which can be so sold in the following order of priority, up to the Maximum Offering Size: (A)  first , the securities that the Company proposes to sell up to the Maximum Offering Size, (B)  second , the Registrable Securities requested to be included in such Piggyback Registration, allocated, if necessary for the offering not to exceed the Maximum Offering Size, pro rata among the Piggyback Eligible Holders on the basis of the number of Registrable Securities requested to be included therein by each Piggyback Eligible Holder, and (C)  third , Other Registrable Securities requested to be included in such Piggyback Registration, allocated, if necessary for the offering not to exceed the Maximum Offering Size, pro rata among the holders thereof on the basis of the number of securities requested to be included therein by each such holder. All Piggyback Eligible Holders requesting to be included in the Piggyback Registration must sell their Registrable Securities to the underwriters selected as provided in Section  2(c)(iv)  on the same terms and conditions as apply to the Company. Promptly (and in any event within one Business Day) following receipt of notification by the Company from the managing underwriter of a range of prices at which such Registrable Securities are likely to be sold, the Company shall so advise each Piggyback Eligible Holder requesting registration in such offering of such price. If any Piggyback Eligible Holder disapproves of the terms of any such underwriting (including the price offered by the underwriter(s) in such offering), such Piggyback Eligible Holder may elect to withdraw any or all of its Registrable Securities therefrom, without prejudice to the rights of any such Holder to include Registrable Securities in any future Piggyback Registration or other registration statement, by written notice to the Company and the managing underwriter(s) delivered on or prior to the effective date of such Piggyback Registration Statement. Any Registrable Securities withdrawn from such underwriting shall be excluded and withdrawn from the registration. For any Piggyback Eligible Holder that is a partnership, limited liability company, corporation or other entity, the partners, members, stockholders, Subsidiaries, parents and Affiliates of such Piggyback Eligible Holder, or the estates and Family Members of any such partners/members and retired partners/members and any trusts for the benefit of any of the foregoing Persons, shall be deemed to be a single “Piggyback Eligible Holder,” and any pro rata reduction with respect to such “Piggyback Eligible Holder” shall be based upon the aggregate amount of securities carrying registration rights owned by all entities and individuals included in such “Piggyback Eligible Holder,” as defined in this sentence.

 

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(iii) Withdrawal from Registration . The Company shall have the right to terminate or withdraw any registration initiated by it under this Section  2(c)  prior to the effective date of such Registration Statement, whether or not any Piggyback Eligible Holder has elected to include Registrable Securities in such Registration Statement, without prejudice, however, to the right of the Holders immediately to request that such registration be effected as a registration under Section  2(b)  to the extent permitted thereunder and subject to the terms set forth therein. The Registration Expenses of such withdrawn registration shall be borne by the Company in accordance with Section  5 hereof.

(iv) Selection of Bankers and Counsel . If a Piggyback Registration pursuant to this Section  2(c)  involves an underwritten offering, the Company shall have the right, in consultation with the Holders of a Majority of Included Registrable Securities included in such underwritten offering, to (A) determine the plan of distribution, including the price at which the Registrable Securities are to be sold and the underwriting commissions, discounts and fees and (B) select the investment banker or bankers and managers to administer the offering, including the lead managing underwriter or underwriters.

(v) Effect of Piggyback Registration . No registration effected under this Section  2(c)  shall relieve the Company of its obligations to effect any registration of the offer and sale of Registrable Securities upon request under Section  2(a)  or Section  2(b)  hereof and no registration effected pursuant to this Section  2(c)  shall be deemed to have been effected pursuant to Section  2(a)  or Section   2(b) hereof.

(d) Notice Requirements . Any Demand Notice, Demand Eligible Holder Request or Piggyback Request shall (i) specify the maximum number or class or series of Registrable Securities intended to be offered and sold by the Holder making the request, (ii) express such Holder’s bona fide intent to offer up to such maximum number of Registrable Securities for distribution, (iii) describe the nature or method of the proposed offer and sale of Registrable Securities (to the extent applicable), and (iv) contain the undertaking of such Holder to provide all such information and materials and take all action as may reasonably be required in order to permit the Company to comply with all applicable requirements in connection with the registration of such Registrable Securities.

(e) Suspension Period .  Notwithstanding any other provision of this Section  2 , the Company shall have the right but not the obligation to defer the filing of (but not the preparation of), or suspend the use by the Holders of, any Registration Statement for a period of up to 45 days (i) if the Company is subject to any of its customary suspension or blackout periods, for all or part of such period; (ii) upon issuance by the Commission of a stop order suspending the effectiveness of any Registration Statement with respect to Registrable Securities or the initiation of Proceedings with respect to such Registration

 

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Statement under Section 8(d) or 8(e) of the Securities Act; (iii) if the Company believes that any such registration or offering (x) should not be undertaken because it would reasonably be expected to materially interfere with any material corporate development or plan (including a pending securities offering by the Company) or (y) would require the Company, under applicable securities laws and other laws, to make disclosure of material nonpublic information that would not otherwise be required to be disclosed at that time and the Company believes in good faith that such disclosures at that time would not be in the Company’s best interests; provided that this exception (y) shall continue to apply only during the time that such material nonpublic information has not been disclosed and remains material; (iv) if the Company elects at such time to offer Company Common Stock or other equity securities of the Company to (x) fund a merger, third-party tender offer or other business combination, acquisition of assets or similar transaction or (y) meet rating agency and other capital funding requirements; (v) if the Company is pursuing a primary underwritten offering of Company Common Stock pursuant to a registration statement; provided that the Holders shall have Piggyback Registration rights with respect to such primary underwritten offering in accordance with and subject to the restrictions set forth in Section  2(c) ; or (vi) if any other material development would materially and adversely interfere with any such Demand Registration or Shelf Registration (any such period, a “ Suspension Period ”); provided , however , that in such event, the Qualified Holders will be entitled to withdraw any request for a Demand Registration and, if such request is withdrawn, such Demand Registration will not count as a Demand Registration as the Company will pay all Registration Expenses in connection with such registration; and provided further , that in no event shall the Company declare a Suspension Period for more than an aggregate of 45 days in any 12-month period. The Company shall give written notice to the Holders of its declaration of a Suspension Period and of the expiration of the relevant Suspension Period. If the filing of any Demand Registration or Shelf Registration is suspended pursuant to this Section  2(e) , once the Suspension Period ends, the Qualified Holders may request a new Demand Registration or a new Shelf Registration.

(f) Required Information .  The Company may require each Holder of Registrable Securities as to which any Registration Statement is being filed or sale is being effected to furnish to the Company such information regarding the distribution of such securities and such other information relating to such Holder and its ownership of Registrable Securities as the Company may from time to time reasonably request in writing ( provided that such information shall be used only in connection with such registration) and the Company may exclude from such registration or sale the Registrable Securities of any such Holder who fails to furnish such information within a reasonable time after receiving such request. Each Holder agrees to furnish such information to the Company and to cooperate with the Company as reasonably necessary to enable the Company to comply with the provisions of this Agreement.

(g) Other Registration Rights Agreements .  The Company has not entered into and, unless agreed in writing by each Holder on or after the date of this Agreement, will not enter into, any agreement that (i) is inconsistent with the rights granted to the Holders with respect to Registrable Securities in this Agreement or otherwise conflicts with the provisions hereof in any material respect or (ii) other than as set forth in this Agreement, would allow any holder of Company Common Stock to include Company Common Stock in any Registration Statement filed by the Company on a basis that is more favorable in any material respect to the rights granted to the Holders hereunder.

 

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(h) Cessation of Registration Rights .  All registration rights granted under this Section  2 shall continue to be applicable with respect to any Holder until such Holder no longer holds any Registrable Securities.

3. Alternative Transactions . Notwithstanding anything to the contrary contained herein, (a) no Holder shall be entitled to any piggyback right or to participate as a Demand Eligible Holder under Section  2 in connection with an Alternative Transaction (including Alternative Transactions off of a Shelf Registration Statement or an Automatic Shelf Registration Statement, or in connection with the registration of Registrable Securities under an Automatic Shelf Registration Statement for purposes of effectuating an Alternative Transaction; provided , that, any registration with respect to an Alternative Transaction shall not constitute a Demand Registration for purposes of determining the number of Demand Registrations effected by the Company under Section  2(b)(ii)  above); and (b) no Holder shall be permitted to request or participate in an underwritten offering (including an Underwritten Shelf Takedown) that is an Alternative Transaction.

4. Registration Procedures .  The procedures to be followed by the Company and each participating Holder to register the sale of Registrable Securities pursuant to a Registration Statement in accordance with this Agreement, and the respective rights and obligations of the Company and such Holders with respect to the preparation, filing and effectiveness of such Registration Statement, are as follows:

(a) The Company will (i) prepare and file a Registration Statement or a prospectus supplement, as applicable, with the Commission (within the time period specified in Section 2(a) or Section 2(b), as applicable, in the case of a Shelf Registration, an Underwritten Shelf Takedown or a Demand Registration) which Registration Statement (A) shall be on a form selected by the Company for which the Company qualifies, (B) shall be available for the sale or exchange of the Registrable Securities in accordance with the intended method or methods of distribution, and (C) shall comply as to form in all material respects with the requirements of the applicable form and include and/or incorporate by reference all financial statements required by the Commission to be filed therewith, (ii) use its commercially reasonable efforts to cause such Registration Statement to become effective and remain effective for the periods provided under Section 2(a) or Section 2(b), as applicable, in the case of a Shelf Registration Statement or a Demand Registration Statement, (iii) use its commercially reasonable efforts to prevent the occurrence of any event that would cause a Registration Statement to contain a material misstatement or omission or to be not effective and usable for resale of the Registrable Securities registered pursuant thereto (during the period that such Registration Statement is required to be effective as provided under Section 2(a) or Section 2(b)), and (iv) cause each Registration Statement and the related Prospectus and any amendment or supplement thereto, as of the effective date of such Registration Statement, amendment or supplement (x) to comply in all material respects with any requirements of the Securities Act and the rules and regulations of the Commission and (y) not to 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

 

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statements therein not misleading. The Company will (1) at least five Business Days prior to the anticipated filing of a Registration Statement or any related Prospectus or any amendment or supplement thereto (including any documents incorporated by reference therein), or before using any Issuer Free Writing Prospectus, furnish to such Holders, the Holders’ counsel and the managing underwriter or underwriters of an underwritten offering of Registrable Securities, if applicable, copies of all such documents proposed to be filed, (2) use its commercially reasonable efforts to address in each such document prior to being so filed with the Commission such comments as such Holder, its counsel or underwriter reasonably shall propose within three Business Days of receipt of such copies by the Holders and (3) not file any Registration Statement or any related Prospectus or any amendment or supplement thereto containing information regarding a participating Holder to which a participating Holder objects.

(b) The Company will as promptly as reasonably practicable (i) prepare and file with the Commission such amendments, including post-effective amendments, and supplements to each Registration Statement and the Prospectus used in connection therewith as (A) may be reasonably requested by any Holder of Registrable Securities covered by such Registration Statement necessary to permit such Holder to sell in accordance with its intended method of distribution or (B) may be necessary under applicable law to keep such Registration Statement continuously effective with respect to the disposition of all Registrable Securities covered thereby for the periods provided under Section 2(a) or Section 2(b), as applicable, in accordance with the intended method of distribution and, subject to the limitations contained in this Agreement, prepare and file with the Commission such additional Registration Statements in order to register for resale under the Securities Act all of the Registrable Securities held by the Holders, (ii) cause the related Prospectus to be amended or supplemented by any required prospectus supplement, and as so supplemented or amended, to be filed pursuant to Rule 424, (iii) respond to any comments received from the Commission with respect to each Registration Statement or Prospectus or any amendment thereto, and (iv) as promptly as reasonably practicable, provide such Holders true and complete copies of all correspondence from and to the Commission relating to such Registration Statement or Prospectus other than any comments that the Company determines in good faith would result in the disclosure to such Holders of material non-public information concerning the Company that is not already in the possession of such Holder. The Company will comply in all material respects with the provisions of the Securities Act and the Exchange Act (including Regulation M under the Exchange Act) with respect to each Registration Statement and the disposition of all Registrable Securities covered by each Registration Statement.

(c) The Company will notify such Holders that, to its knowledge, hold Registrable Securities and the managing underwriter or underwriters of an underwritten offering of Registrable Securities, if applicable, as promptly as reasonably practicable: (i)(A) when a Registration Statement, any pre-effective amendment, any Prospectus or any prospectus supplement or post-effective amendment to a Registration Statement or any free writing prospectus is proposed to be filed; (B) when the Commission notifies the Company whether there will be a “review” of such Registration Statement and whenever the Commission comments on such Registration Statement (in which case the Company shall provide true and complete copies thereof and all written responses thereto to each Holder,

 

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its counsel and each underwriter, if applicable, other than information which the Company determines in good faith would constitute material non-public information that is not already in the possession of such Holder); and (C) with respect to each Registration Statement or any post-effective amendment thereto, when the same has been declared effective; (ii) of any request by the Commission or any other federal or state governmental or regulatory authority for amendments or supplements to a Registration Statement or Prospectus or for additional information (whether before or after the effective date of the Registration Statement) or any other correspondence with the Commission or any such authority relating to, or which may affect, the Registration Statement; (iii) of the issuance by the Commission or any other governmental or regulatory authority of any stop order, injunction or other order or requirement suspending the effectiveness of a Registration Statement covering any or all of the Registrable Securities or the initiation of any Proceedings for that purpose; (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of any Proceeding for such purpose; (v) if, at any time, the representations and warranties of the Company in any applicable underwriting agreement or similar agreement cease to be true and correct in all material respects; or (vi) of the occurrence of any event that makes any statement made in such Registration Statement or Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any material respect or if, as a result of such event or the passage of time, such Registration Statement, Prospectus or other documents requires revisions so that, in the case of such Registration Statement or the Prospectus, as the case may be, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus, in light of the circumstances under which they were made) not misleading, or when any Issuer Free Writing Prospectus includes information that may conflict with the information contained in the Registration Statement or Prospectus, or if, for any other reason, it shall be necessary during such time period to amend or supplement such Registration Statement or Prospectus in order to comply with the Securities Act, which shall correct such misstatement or omission or effect such compliance.

(d) The Company will use its commercially reasonable efforts to avoid the issuance of, or, if issued, obtain the withdrawal of (i) any stop order or other order suspending the effectiveness of a Registration Statement or the use of any Prospectus, or (ii) any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction, at the earliest practicable moment, or if any such order or suspension is made effective during any Suspension Period, at the earliest practicable moment after the Suspension Period is over.

(e) During the Effectiveness Period or the Shelf Period, as applicable, the Company will furnish to each selling Holder and the managing underwriter or underwriters of an underwritten offering of Registrable Securities, if applicable, upon their request, without charge, at least one conformed copy of each Registration Statement and each amendment thereto and all exhibits to the extent requested by such selling Holder or underwriter (including those incorporated by reference) promptly after the filing of such documents with the Commission.

 

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(f) The Company will promptly deliver to each selling Holder and the managing underwriter or underwriters of an underwritten offering of Registrable Securities, if applicable, without charge, as many copies of each Prospectus or Prospectuses (including each form of prospectus) and each amendment or supplement thereto as such selling Holder or underwriter may reasonably request in order to facilitate the disposition of the Registrable Securities by such selling Holder or underwriter. The Company consents to the use of such Prospectus and each amendment or supplement thereto by each of the selling Holders and any applicable underwriter in connection with the offering and sale of the Registrable Securities covered by such Prospectus and any amendment or supplement thereto.

(g) The Company will use its commercially reasonable efforts to (i) register or qualify the Registrable Securities covered by a Registration Statement, no later than the time such Registration Statement is declared effective by the Commission, under all applicable securities laws (including the “blue sky” laws) of such jurisdictions each underwriter, if any, or any selling Holder shall reasonably request; (ii) keep each such registration or qualification effective during the period such Registration Statement is required to be kept effective under the terms of this Agreement and (iii) do any and all other acts and things which may be reasonably necessary or advisable to enable such underwriter, if any, and each selling Holder to consummate the disposition in each such jurisdiction of the Registrable Securities covered by such Registration Statement; provided , however , that the Company will not be required to (x) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph, (y) subject itself to taxation in any such jurisdiction or (z) consent to general service of process (other than service of process in connection with such registration or qualification or any sale of Registrable Securities in connection therewith) in any such jurisdiction.

(h) To the extent that the Company has certificated shares of Company Common Stock, the Company will cooperate with each Holder and the underwriter or managing underwriter of an underwritten offering of Registrable Securities, if applicable, to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be delivered to a transferee pursuant to a Registration Statement, which certificates shall be free of all restrictive legends indicating that the Registrable Securities are unregistered or unqualified for resale under the Securities Act, Exchange Act or other applicable securities laws, and to enable such Registrable Securities to be in such denominations and registered in such names as each Holder or the underwriter or managing underwriter of an underwritten offering of Registrable Securities, if any, may request in writing. In connection therewith, if required by the Company’s transfer agent, the Company will promptly, after the effective date of the Registration Statement, cause an opinion of counsel as to the effectiveness of the Registration Statement to be delivered to and maintained with such transfer agent, together with any other authorizations, certificates and directions required by the transfer agent which authorize and direct the transfer agent to issue such Registrable Securities without any such legend upon sale by the Holder or the underwriter or managing underwriter of an underwritten offering of Registrable Securities, if any, of such Registrable Securities under the Registration Statement.

 

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(i) Upon the occurrence of any event contemplated by Section 4(d)(vi), as promptly as reasonably practicable, the Company will prepare a supplement or amendment, including a post-effective amendment, if required by applicable law, to the affected Registration Statement or a supplement to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference or to the applicable Issuer Free Writing Prospectus, and file any other required document so that, as thereafter delivered, no Registration Statement nor any Prospectus will contain an 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 (in the case of a Prospectus, in light of the circumstances under which they were made) not misleading and no Issuer Free Writing Prospectus will include information that conflicts with information contained in the Registration Statement or Prospectus, such that each selling Holder can resume disposition of such Registrable Securities covered by such Registration Statement or Prospectus.

(j) Selling Holders may distribute the Registrable Securities by means of an underwritten offering; provided that (i) such Holders provide to the Company a Shelf Takedown Notice or Demand Notice of their intention to distribute Registrable Securities by means of an underwritten offering, (ii) the right of any Holder to include such Holder’s Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein, (iii) each Holder participating in such underwritten offering agrees to enter into customary agreements, including an underwriting agreement in customary form, and sell such Holder’s Registrable Securities on the basis provided in any underwriting arrangements approved by the Holders entitled to select the managing underwriter or managing underwriters hereunder (provided that any such Holder shall not be required to make any representations or warranties to or agreements with the Company or the underwriters other than representations, warranties, agreements and indemnities regarding such Holder, such Holder’s title to the Registrable Securities, such Holder’s intended method of distribution, the accuracy of information concerning such Holder as provided by or on behalf of such Holder, and any other representations required to be made by the Holder under applicable law, and the aggregate amount of the liability of such Holder in connection with such offering shall not exceed such Holder’s net proceeds from the disposition of such Holder’s Registrable Securities in such offering) and (iv) each Holder participating in such underwritten offering completes and executes all questionnaires, powers of attorney, custody agreements and other documents reasonably required under the terms of such underwriting arrangements. The Company hereby agrees with each Holder that, in connection with any underwritten offering in accordance with the terms hereof, it will negotiate in good faith and execute all indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements, and will procure auditor “comfort” letters addressed to the underwriters in the offering from the Company’s independent certified public accountants or independent auditors (and, if necessary, any other independent certified public accountants or independent auditors of any Subsidiary of the Company or any business acquired by the Company for which financial statements and financial data are, or are required to be, included in the Registration Statement) in customary form and covering such matters of the type customarily covered by comfort letters as the underwriters reasonably request, dated the date of execution of the underwriting agreement and brought down to the closing under the underwriting agreement.

 

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(k) The Company will obtain for delivery to the underwriter or underwriters of an underwritten offering of Registrable Securities an opinion or opinions from counsel for the Company (including any local counsel reasonably requested by the underwriters) dated the most recent effective date of the Registration Statement or, in the event of an underwritten offering, the date of the closing under the underwriting agreement, in customary form, scope and substance, covering the matters customarily covered in opinions requested in sales of securities or underwritten offerings, which opinions shall be reasonably satisfactory to such underwriters and their counsel.

(l) For a reasonable period prior to the filing of any Registration Statement and throughout the Effectiveness Period or the Shelf Period, as applicable, the Company will make available upon reasonable notice at the Company’s principal place of business or such other reasonable place for inspection by a representative appointed by the Holders of a Majority of Included Registrable Securities covered by the applicable Registration Statement, by any managing underwriter or managing underwriters selected in accordance with this Agreement and by any attorney, accountant or other agent retained by such Holders or underwriter, such financial and other information and books and records of the Company, and cause the officers, employees, counsel and independent certified public accountants of the Company to respond to such inquiries, as shall be reasonably necessary (and in the case of counsel, not violate an attorney-client privilege in such counsel’s reasonable belief) to conduct a reasonable investigation within the meaning of Section 11 of the Securities Act.

(m) The Company will (i) provide and cause to be maintained a transfer agent and registrar for all Registrable Securities covered by the applicable Registration Statement from and after a date not later than the effective date of such Registration Statement and provide and enter into any reasonable agreements with a custodian for the Registrable Securities and (ii) not later than the effective date of the applicable Registration Statement, provide a CUSIP number for all Registrable Securities.

(n) The Company will cooperate with each Holder of Registrable Securities and each underwriter or agent participating in the disposition of Registrable Securities and their respective counsel in connection with any filings required to be made with FINRA and in performance of any due diligence investigations by any underwriter.

(o) The Company will use its commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, the Trading Market, FINRA and any state securities authority, and make available to each Holder, as soon as reasonably practicable after the effective date of the Registration Statement, an earnings statement covering at least 12 months which shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158.

 

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(p) The Company will use its commercially reasonable efforts to ensure that any Issuer Free Writing Prospectus utilized in connection with any Prospectus complies in all material respects with the Securities Act, is filed in accordance with the Securities Act to the extent required thereby, is retained in accordance with the Securities Act to the extent required thereby and, when taken together with the related Prospectus, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

(q) In connection with any registration of Registrable Securities pursuant to this Agreement, the Company will take all commercially reasonable actions as are necessary or advisable in order to expedite or facilitate the disposition of Registrable Securities by such Holders, including using commercially reasonable efforts to cause appropriate officers and employees to be available, on a customary basis and upon reasonable advance notice, to meet with prospective investors in presentations, meetings and road shows; provided, however that the Company shall not be required to participate in any marketing effort that is longer than two business days or requires face to face meeting with investors more than once every 90 days and no more than three times in a 12-month period.

(r) The Company shall use its commercially reasonable efforts to maintain the listing of the Company Common Stock on the New York Stock Exchange, and following the listing of any other Registrable Securities on the New York Stock Exchange or the relevant Nasdaq market, shall use its commercially reasonable efforts to maintain the listing of such Registrable Securities on the New York Stock Exchange or the relevant Nasdaq market, as applicable, until each Holder has sold all of its Registrable Securities.

(s) The Company shall, if such registration for an underwritten offering is pursuant to a Registration Statement on Form S-3 or any similar short-form registration, include in such Registration Statement such additional information for marketing purposes as the managing underwriter(s) reasonably request(s).

(t) The Company shall use its commercially reasonable efforts to cooperate in a timely manner with any reasonable and customary request of the Holders in respect of any Alternative Transaction, including entering into customary agreements with respect to such Alternative Transactions (and providing customary representations, warranties, covenants and indemnities in such agreements) as well as providing other reasonable assistance in respect of such Alternative Transactions of the type applicable to a Public Offering subject to this Section 4, to the extent customary for such transactions.

(u) The Company shall use its best efforts either to (i) cause all of the Registrable Securities covered by a Registration Statement to be listed on each securities exchange on which securities of the same class or series issued by the Company are then listed, if any, if the listing of such Registrable Securities is then permitted under the rules of such exchange or (ii) secure the inclusion for quotation of all of the Registrable Securities on the OTC Bulletin Board or (iii) if, despite the Company’s best efforts, the Company is unsuccessful in satisfying the preceding clauses (i) and (ii), to secure the inclusion for quotation on any trading market for such Registrable Securities and, without limiting the generality of the foregoing, to use its reasonable best efforts to arrange for at least two market makers to register with FINRA as such with respect to such Registrable Securities. The Company shall pay all fees and expenses in connection with satisfying its obligation under this Section 4(t).

 

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(v) If requested by a Holder, the Company shall as soon as practicable (i) incorporate in a Prospectus supplement or post-effective amendment such information as a Holder reasonably requests to be included therein relating to the sale and distribution of Registrable Securities, including, without limitation, information with respect to the number of Registrable Securities being offered or sold, the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering; (ii) make all required filings of such Prospectus supplement or post-effective amendment after being notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration Statement if reasonably requested by a Holder.

5. Registration Expenses .  The Company shall bear all reasonable Registration Expenses incident to the Parties’ performance of or compliance with their respective obligations under this Agreement or otherwise in connection with any Demand Registration , Shelf Registration, Shelf Takedown Notice or Piggyback Registration (excluding any Selling Expenses), whether or not any Registrable Securities are sold pursuant to a Registration Statement.

“ Registration Expenses ” shall include, without limitation, (i) all registration, qualification and filing fees and expenses (including fees and expenses (A) of the Commission or FINRA, (B) incurred in connection with the listing of the Registrable Securities on the Trading Market, and (C) in compliance with applicable state securities or “Blue Sky” laws (including reasonable fees and disbursements of counsel for the underwriters in connection with blue sky qualifications of the Registrable Securities as may be set forth in any underwriting agreement)); (ii) expenses in connection with the preparation, printing, mailing and delivery of any registration statements, prospectuses and other documents in connection therewith and any amendments or supplements thereto (including expenses of printing certificates for the Company’s shares); (iii) analyst or investor presentation or road show expenses of the Company and the underwriters, if any; (iv) messenger, telephone and delivery expenses; (v) reasonable fees and disbursements of counsel (including any local counsel), auditors and accountants for the Company (including the expenses incurred in connection with “comfort letters” required by or incident to such performance and compliance); (vi) the reasonable fees and disbursements of underwriters to the extent customarily paid by issuers or sellers of securities (including, if applicable, the fees and expenses of any “qualified independent underwriter” (and its counsel) that is required to be retained in accordance with the rules and regulations of FINRA and the other reasonable fees and disbursements of underwriters (including reasonable fees and disbursements of counsel for the underwriters) in connection with any FINRA qualification; (vii) fees and expenses of any special experts retained by the Company; (viii) Securities Act liability insurance, if the Company so desires such insurance; (ix) reasonable fees and disbursements of one counsel (along with any reasonably necessary local counsel) representing all Holders mutually agreed by Holders of a Majority of Included Registrable Securities participating in the related registration; (x) fees and expenses payable in connection with any ratings of the Registrable Securities, including expenses relating to any presentations to rating agencies; (xi) internal expenses of the Company (including all salaries and expenses of its officers and employees performing legal or accounting duties); (xii) transfer agents’ and registrars’ fees and expenses and the fees and expenses of any other agent or trustee appointed in connection with

 

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such offering; and (xiii) any liability insurance or other premiums for insurance obtained in connection with any Demand Registration, Piggyback Registration or Shelf Registration pursuant to the terms of this Agreement. In addition, the Company shall be responsible for all of its expenses incurred in connection with the consummation of the transactions contemplated by this Agreement (including expenses payable to third parties and including all salaries and expenses of the Company’s officers and employees performing legal or accounting duties), the expense of any annual audit and any underwriting fees, discounts, selling commissions and stock transfer taxes and related legal and other fees applicable to securities sold by the Company and in respect of which proceeds are received by the Company. Each Holder shall pay any Selling Expenses applicable to the sale or disposition of such Holder’s Registrable Securities pursuant to any Demand Registration Statement or Piggyback Registration Statement, or pursuant to any Shelf Registration Statement under which such selling Holder’s Registrable Securities were sold, in proportion to the amount of such selling Holder’s shares of Registrable Securities sold in any offering under such Demand Registration Statement, Piggyback Registration Statement or Shelf Registration Statement.

6. Indemnification .

(a) If requested by a participating Holder, the Company shall indemnify and hold harmless each underwriter, if any, engaged in connection with any registration referred to in Section 2 and provide representations, covenants, opinions and other assurances to such underwriter in form and substance reasonably satisfactory to such underwriter and the Company. Further, the Company shall indemnify and hold harmless each Holder, its partners, stockholders, equityholders, general partners, managers, members, and Affiliates and each of their respective officers and directors and any Person who controls any such Holder (within the meaning of the Securities Act) and any employee or Representative thereof (collectively, “Indemnified Persons”), to the fullest extent permitted by applicable law, from and against any and all losses, claims, damages, liabilities, joint or several, costs (including reasonable costs of preparation and reasonable attorneys’, accountants’ and experts’ fees) and expenses, judgments, fines, penalties, interest, settlements or other amounts arising from any and all Proceedings, whether civil, criminal, administrative or investigative, in which any Indemnified Person may be involved, or is threatened to be involved, as a party or otherwise, under the Securities Act or otherwise (collectively, “Losses”), as incurred, arising out of, based upon, resulting from or relating to (i) any untrue or alleged untrue statement of a material fact contained in any Registration Statement under which any Registrable Securities were registered, Prospectus (including in any preliminary prospectus (if used prior to the effective date of such Registration Statement)), or in any summary or final prospectus or free writing prospectus or in any amendment or supplement thereto or in any documents incorporated by reference in any of the foregoing or (ii) the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements made therein not misleading, or (iii) any violation or alleged violation by the Company or any of its Subsidiaries of any federal, state or common law rule or regulation relating to action or inaction in connection with any Company provided information in such registration, disclosure document or related document or report, and the Company will reimburse such Indemnified Person for any legal or other expenses reasonably incurred by it in connection with investigating or defending any such Proceeding; provided , however, that the Company

 

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shall not be liable to any Indemnified Person to the extent that any such Losses arise out of, are based upon or results from an untrue or alleged untrue statement or omission or alleged omission made in such Registration Statement, such preliminary, summary or final prospectus or free writing prospectus or such amendment or supplement, in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Indemnified Person specifically for use in the preparation thereof.

(b) In connection with any Registration Statement filed by the Company pursuant to Section 2 hereof in which a Holder has registered for sale its Registrable Securities, each such selling Holder agrees (severally and not jointly) to indemnify and hold harmless, to the fullest extent permitted by law, the Company, its directors and officers, Affiliates, employees, agents and each Person who controls the Company (within the meaning of the Securities Act or the Exchange Act) from and against any Losses resulting from (i) any untrue statement of a material fact in any Registration Statement under which such Registrable Securities were registered or sold under the Securities Act (including any final, preliminary or summary Prospectus contained therein or any amendment thereof or supplement thereto or any documents incorporated by reference therein) or (ii) any omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or omission is contained in any information furnished in writing by or on behalf of such selling Holder to the Company specifically for inclusion in such Registration Statement or Prospectus and has not been corrected in a subsequent writing prior to the sale of the Registrable Securities to the Indemnified Person asserting the claim. In no event shall the liability of any selling Holder hereunder be greater in amount than the dollar amount of the net proceeds received by such Holder under the sale of Registrable Securities giving rise to such indemnification obligation less any amounts paid by such Holder in connection with such sale.

(c) Any Indemnified Person shall (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that any delay or failure to so notify the Indemnifying Person shall not relieve the indemnifying party of its obligations hereunder except to the extent, if at all, that it is actually and materially prejudiced by reason of such delay or failure) and (ii) permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the Indemnified Person; provided, however, that any Indemnified Person shall have the right to select and employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of such indemnified person unless (A) the indemnifying party has agreed in writing to pay such fees or expenses, (B) the indemnifying party shall have failed to assume the defense of such claim within a reasonable time after receipt of notice of such claim from the Indemnified Person and employ counsel reasonably satisfactory to such Indemnified Person, (C) the Indemnified Person has reasonably concluded (based upon advice of its counsel) that there may be legal defenses available to it or other Indemnified Persons that are different from or in addition to those available to the indemnifying party, or (D) in the reasonable judgment of any such Indemnified Person (based upon advice of its counsel) a conflict of interest may exist between such Indemnified Person and the indemnifying party with respect to such claims (in which case, if the Indemnified Person notifies the indemnifying party in writing that such Indemnified Person elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the

 

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right to assume the defense of such claim on behalf of such Indemnified Person). No action may be settled without the consent of the indemnifying party, provided that the consent of the Indemnified Person shall not be required if (A) such settlement includes an unconditional release of such Indemnified Person in form and substance satisfactory to such Indemnified Person from all liability on the claims that are the subject matter of such settlement; (B) such settlement provides for the payment by the indemnifying party of money as the sole relief for such action and (C) such settlement does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any indemnified party. It is understood that the indemnifying party or parties shall not, except as specifically set forth in this Section 6(c), in connection with any Proceeding or related Proceedings in the same jurisdiction, be liable for the reasonable fees, disbursements or other charges of more than one separate firm admitted to practice in such jurisdiction at any one time. Notwithstanding the provisions of this Section 6(c), no selling Holder shall be required to contribute any amount in excess of the net proceeds (after deducting the underwriters’ discounts and commissions) received by such selling Holder in the offering. 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 misrepresentation. Each selling Holder’s obligation to contribute pursuant to this Section 6(c) is several in the proportion that the proceeds of the offering received by such selling Holder bears to the total proceeds of the offering received by all such selling Holders and not joint.

(d) The remedies provided for in this Section 6 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.

7. Facilitation of Sales Pursuant to Rule 144 . The Company shall use its commercially reasonable efforts to timely file the reports required to be filed by it under the Exchange Act or the Securities Act and the rules adopted by the Commission thereunder (including the reports under Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144), and shall take such further action as any Holder may reasonably request, all to the extent required from time to time to enable the Holders to sell Registrable Securities without registration under the Securities Act within the limitations of the exemption provided by Rule 144. Upon the written request of any Holder in connection with that Holder’s sale pursuant to Rule 144, the Company shall deliver to such Holder a written statement as to whether it has complied with such requirements.

8. Miscellaneous .

(a) Remedies . In the event of a breach by any party hereto of any of its obligations under this Agreement, the non-breaching parties, in addition to being entitled to exercise all rights granted by law and under this Agreement, including recovery of damages, will be entitled to specific performance of its rights under this Agreement. Each party agrees that monetary damages would not provide adequate compensation for any losses incurred by reason of a breach by it of any of the provisions of this Agreement and further agrees that, in the event of any action for specific performance in respect of such breach, it shall waive the defense that a remedy at law would be adequate and shall waive any requirement for the posting of a bond.

 

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(b) Discontinued Disposition . Each Holder agrees by its acquisition of Registrable Securities that, upon receipt of a notice from the Company of the occurrence of any event of the kind described in clauses (ii) through (iv) and (vi) of Section  4(d)  or the occurrence of a Suspension Period, such Holder will forthwith discontinue disposition of such Registrable Securities under the Registration Statement until such Holder’s receipt of the copies of the supplemental Prospectus or amended Registration Statement or until it is advised in writing by the Company that the use of the applicable Prospectus may be resumed, and, in either case, has received copies of any additional or supplemental filings that are incorporated or deemed to be incorporated by reference in such Prospectus or Registration Statement. The Company may provide appropriate stop orders to enforce the provisions of this Section  8(b) . In the event the Company shall give any such notice, the period during which the applicable Registration Statement is required to be maintained effective shall be extended by the number of days during the period from and including the date of the giving of such notice to and including the date when each seller of Registrable Securities covered by such Registration Statement either receives the copies of the supplemented or amended Prospectus or is advised in writing by the Company that the use of the Prospectus may be resumed. Notwithstanding anything to the contrary, the Company shall cause its transfer agent to deliver unlegended Common Shares to a transferee of Registrable Securities in connection with any sale of Registrable Securities with respect to which a Holder has entered into a contract for sale, prior to such Holder’s receipt of the notice of a Suspension Period and for which such Holder has not yet settled.

(c) Amendments . This Agreement may be amended, modified, extended or terminated, and the provisions hereof may be waived, only with (i) the consent of the Company and (ii) the affirmative vote of Holders of not less than a majority of the Registrable Securities Securities; provided that in no event shall the obligations of any Holder of Registrable Securities be increased or the rights of any Holder be adversely affected (without similarly increasing or adversely affecting the rights of all Holders), except upon the written consent of such Holder. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of Holders of Registrable Securities whose securities are being sold pursuant to a Registration Statement and that does not directly or indirectly affect the rights of other Holders of Registrable Securities may be given by holders of at least a majority of the Registrable Securities being sold by such Holders pursuant to such Registration Statement.

(d) Waivers . No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any Party to exercise any right hereunder in any manner impair the exercise of any such right.

(e) Notices . Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile (with confirmation of delivery) or electronic mail in PDF or similar electronic or digital format (with confirmation of receipt) prior to 5:00 p.m. (New York

 

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time) on a business day in the place of receipt, (ii) the business day after the date of transmission, if such notice or communication is delivered via facsimile (with confirmation of delivery) or electronic mail in PDF or similar electronic or digital format (with confirmation of receipt) later than 5:00 p.m. (New York time) on any date and earlier than 11:59 p.m. (New York time) on such date, (iii) the Business Day following the date of mailing, if sent by nationally recognized overnight courier service or (iv) upon actual receipt by the Party to whom such notice is required to be given. The address for such notices and communications shall be as follows:

 

If to the Company:

Amplify Energy Corp. 500 Dallas Street, Suite 1700

Houston, Texas 77002

Attn.: Martyn Willsher with a copy (which shall not constitute notice) to:

Attn: Matthew R. Pacey

Kirkland & Ellis LLP 609 Main Street, 47th Floor

Houston, Texas 77002

If to any other Person who is then a Holder, to the address of such Holder as it appears on the signature pages hereto or such other address as may be designated in writing hereafter by such Person.

(f) Successors and Assigns; Transfers; New Issuances . This Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective heirs, executors, administrators, successors, legal representatives. Without limiting any other restriction on transfer contained in any other contract by and among the Company and any of the Holders, or by and among the Holders, each Holder agrees that it shall not transfer any shares of Company Common Stock to any Person unless (i) such transfer is made in compliance with the Securities Act, any other applicable securities or “blue sky” laws, or rules or regulations promulgated by FINRA, and the terms and conditions of the certificate of incorporation and the by-laws of the Company, (ii) the transferee (if it will hold Registrable Securities upon and following such transfer and reasonably determines, based on the advice of counsel, that it is an “affiliate” (as such term is defined in the Securities Act) of the Company or holds Company Common Stock that is “restricted” or “control” stock (as such terms are defined in the Securities Act) and is not already a party hereto) shall have delivered to the Company a Joinder Agreement in substantially the form attached hereto as Exhibit  A agreeing to become subject to and bound by the terms of this Agreement and (iii) the Holder gives the Company written notice of such transfer, stating the name and address of the transferee. Any attempt to transfer any shares of Company Common Stock not in compliance with this Agreement and the certificate of incorporation of the Company shall be null and void ab initio , and the Company shall not give any effect in the Company’s stock records to such attempted transfer. Notwithstanding any other provision of this Agreement to the contrary, the Company shall not transfer or assign its rights or obligations hereunder without the prior written consent of each Holder.

 

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(g) Governing Law . This Agreement, and any claim, controversy or dispute arising under or related to this Agreement, shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to the choice of law or conflicts of law.

(h) Submission to Jurisdiction . The parties hereby agree that any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby shall be brought in the United States District Court for the Southern District of New York or any New York State court sitting in the County of New York, so long as one of such courts shall have subject matter jurisdiction over such suit, action or proceeding, and that any cause of action arising out of this Agreement shall be deemed to have arisen from a transaction of business in the State of New York, and each of the parties hereby irrevocably consents to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. Process in any such suit, action or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service of process on such party as provided in subsection (e) of this Section 8 shall be deemed effective service of process on such party.

(i) WAIVER OF JURY TRIAL . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

(j) Cumulative Remedies . The remedies provided herein are cumulative and not exclusive of any remedies provided by law.

(k) Severability . If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the Parties shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the Parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

(l) Entire Agreement . This Agreement constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes all prior contracts or agreements with respect to the subject matter hereof and supersedes any and all prior or contemporaneous discussions, agreements and understandings, whether oral or written, that may have been made or entered into by or among any of the Parties or any of their respective Affiliates relating to the transactions contemplated hereby.

 

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(m) Execution of Agreement . This Agreement may be executed and delivered (by facsimile, by electronic mail in portable document format (.pdf) or otherwise) in any number of counterparts, each of which, when executed and delivered, shall be deemed an original, and all of which together shall constitute the same agreement.

(n) Determination of Ownership . In determining ownership of Company Common Stock hereunder for any purpose, the Company may rely solely on the records of the transfer agent for the Company Common Stock from time to time, or, if no such transfer agent exists, the Company’s stock ledger.

(o) Headings; Section  References . The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

(p) No Recourse . Notwithstanding anything that may be expressed or implied in this Agreement, and notwithstanding the fact that certain of the Holders may be partnerships or limited liability companies, each Holder covenants, agrees and acknowledges that no recourse under this Agreement or any documents or instruments delivered in connection with this Agreement shall be had against any of the Company’ or the Holder’s former, current or future direct or indirect equity holders, controlling persons, stockholders, directors, officers, employees, agents, Affiliates, members, financing sources, managers, general or limited partners or assignees (each, a “ Related Party ” and collectively, the “ Related Parties ”), in each case other than the Company, the current or former Holders or any of their respective assignees under this Agreement, whether by the enforcement of any assessment or by any legal or equitable Proceeding, or by virtue of any applicable law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any of the Related Parties, as such, for any obligation or liability of the Company or the Holders under this Agreement or any documents or instruments delivered in connection herewith for any claim based on, in respect of or by reason of such obligations or liabilities or their creation; provided, however, nothing in this Section  8(p)  shall relieve or otherwise limit the liability of the Company or any current or former Holder, as such, for any breach or violation of its obligations under this Agreement or such agreements, documents or instruments.

(q) Recapitalizations, Exchanges,  etc.  The provisions of this Agreement shall apply to the full extent set forth herein with respect to (a) the Company Common Stock, (b) any and all securities into which shares of Company Common Stock are converted, exchanged or substituted in any recapitalization or other capital reorganization by the Company and (c) any and all equity securities of the Company or any successor or assign of the Company (whether by merger, consolidation, sale of assets or otherwise) which may be issued in respect of, in conversion of, in exchange for or in substitution of, the Company Common Stock and shall be appropriately adjusted for any stock dividends, splits, reverse splits, combinations, recapitalizations and the like occurring after the date hereof. The Company shall cause any successor or assign (whether by merger, consolidation, sale of assets or otherwise) to assume the obligations of the Company under this Agreement or enter into a new registration rights agreement with the Holders on terms substantially the same as this Agreement as a condition of any such transaction.

 

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(r) Limitations on Subsequent Registration Rights . The Company agrees that it shall not enter into any agreement with any holder or prospective holder of any securities of the Company (i) that would allow such holder or prospective holder to include such securities in any Demand Registration, Piggyback Registration or Shelf Registration unless, under the terms of such agreement, such holder or prospective holder may include such securities in any such registration only to the extent that their inclusion would not reduce the amount of the Registrable Securities of the Holders included therein or (ii) on terms otherwise more favorable in the aggregate than this Agreement. The Company also represents and warrants to each Holder that it has not previously entered into any agreement with respect to any of its securities granting any registration rights to any Person with respect to the Registrable Securities.

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IN WITNESS WHEREOF, the parties have executed this Amended and Restated Registration Rights Agreement as of the date first written above.

 

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SCHEDULE I

STOCKHOLDERS

Fir Tree Capital Opportunity (LN) Master Fund, L.P.

Fir Tree Value (LN) Master Fund, L.P.

FT SOF IV Holdings, LLC

FT SOF V Holdings, LLC

FT SOF VII AIV Holdings I, LLC

Fir Tree Capital Opportunity Master Fund III, LP

Fir Tree E&P Holdings VII, LLC

Fir Tree E&P Holdings VIII, LLC

Avenue Energy Opportunities Fund, L.P.

Future Directions Credit Opportunities Fund

Brigade Credit Fund II Ltd.

Big River Group Fund SPC LLC

Brigade Cavalry Fund Ltd

Blue Falcon Limited

Delta Master Trust

Brigade Distressed Value Master Fund Ltd.

Brigade Energy Opportunities Fund II LP

Brigade Energy Opportunities Fund LP

FedEx Corporation Employees’ Pension Trust

Brigade Opportunistic Credit Fund—ICIP, Ltd.

Illinois State Board of Investment

FCA Canada Inc. Elected Master Trust

FCA US LLC Master Retirement Trust

JPMorgan Chase Retirement Plan Brigade Bank Loan

JPMorgan Chase Retirement Plan Brigade

Brigade Opportunistic Credit LBG Fund Ltd.

Los Angeles County Employees Retirement Association

Brigade Leveraged Capital Structures Fund Ltd.

SC Credit Opportunities Mandate LLC

U.S. High Yield Bond Fund

SEI Global Master Fund Plc the SEI High Yield Fixed Income Fund

SEI Institutional Investments Trust-High Yield Bond Fund

SEI Institutional Managed Trust-High Yield Bond Fund

GIC Private Limited

The Coca-Cola Company Master Retirement Trust

St. James’ Place Diversified Bond Unit Trust

Panther BCM LLC

Axys Capital Income Fund LLC

EXHIBIT A

Form of Joinder Agreement

The undersigned hereby agrees, effective as of the date set forth below, to become a party to that certain Amended and Restated Registration Rights Agreement (as amended, restated and modified from time to time, the “ Agreement ”) dated as of [•], 2019, by and among Amplify Energy Corp., a Delaware corporation (f/k/a Midstates Petroleum Company, Inc.) (the “ Company ”), and the holders of the Company’s common stock named therein, and for all purposes of the Agreement the undersigned will be included within the term “Holder” (as defined in the Agreement). The address, facsimile number and email address to which notices may be sent to the undersigned are as follows:

 

Address:
Facsimile No.:
Email:
Date:
				[ If entity ]
				[ ENTITY NAME ]
				By:
						Name:
						Title:
				[ If individual ]
				Individual Name:

Exhibit 10.2

ASSIGNMENT AND ASSUMPTION AGREEMENT

This Assignment and Assumption Agreement (this “ Assumption Agreement ”) is entered into and effective as of August 6, 2019 by and among Amplify Energy Corp., a Delaware corporation (the “ Company ”), Midstates Petroleum Company, Inc., a Delaware corporation (“ Parent ”), and American Stock Transfer & Trust Company, LLC (the “ Warrant Agent ”).

WHEREAS, the Company and the Warrant Agent are parties to that certain Warrant Agreement dated as of May 4, 2017 (the “ Warrant Agreement ”); capitalized terms used but not otherwise defined herein shall have the meanings given to such terms in the Merger Agreement (as defined below);

WHEREAS, Parent, Midstates Holdings, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“ Merger Sub ”), and the Company are parties to that certain Agreement and Plan of Merger, dated as of May 5, 2019 (as amended, restated, modified or supplemented, the “ Merger Agreement ”), pursuant to which, subject to the terms and conditions set forth therein, Merger Sub has agreed to merge with and into the Company, with the Company surviving the merger as a wholly owned subsidiary of Parent, and (immediately thereafter, as part of the same transaction, the Company will merge with and into a wholly owned subsidiary of Parent, with such subsidiary continuing as the surviving entity (the “ Merger ”);

WHEREAS, pursuant to the Merger Agreement, at the effective time of the Merger (the “ Effective Time ”), by virtue of the Merger and without any further action on the part of Parent, Merger Sub or the Company, each share of common stock, par value $0.0001 per share, of the Company (“ Company Common Stock ”) outstanding immediately prior to the Effective Time shall be converted into the right to receive 0.933 shares of Parent common stock, par value $0.01 per share (“ Parent Common Stock ”) (the “ Merger Consideration ”);

WHEREAS, pursuant to Section 9 of the Warrant Agreement, the Company may not effect a merger, prior to the consummation of such transaction, unless Parent assumes, by written instrument delivered to the Warrant Agent, the obligations (the “ Obligations ”) of the Company under the Warrant Agreement and under each of the warrants issued and outstanding thereunder (collectively, the “ Warrants ”);

WHEREAS, pursuant to Section 6.19 of the Merger Agreement, prior to the Effective Time, Parent and the Company shall make all necessary and appropriate provisions to ensure that, pursuant to the terms of the Warrant Agreement, holders of the Warrants have the right to acquire and receive, upon the exercise of such Warrants, the number of shares of Parent Common Stock that would have been issued or paid to the holders of the Warrants if such holders were to have exercised the Warrants immediately prior to the Effective Time, including Parent’s assumption by written instrument of the obligations to deliver to each such holder such shares of Parent Common Stock pursuant to the terms of the Warrant Agreement;

WHEREAS, upon the Effective Time, Parent desires to assume the Obligations, with the Warrants continuing to be subject to the same terms and conditions immediately prior to the Effective Time as set forth in the Warrant Agreement, except that, in accordance with Section 9 of the Warrant Agreement, such Warrant will cease to represent a warrant to purchase shares of Company Common Stock and each holder of a Warrant shall instead have the right, after the Effective Time, to receive, upon exercise of a Warrant, solely the Merger Consideration receivable in respect of the number of shares of Company Common Stock for which such Warrant is exercisable immediately prior to the Effective Time;

WHEREAS, in accordance with Section 16 of the Warrant Agreement, the Company and the Warrant Agent may from time to time supplement or amend the Warrant Agreement without the approval of any holders of the Warrants to make any provisions in regard to matters or questions arising under the Warrant Agreement that the Company and the Warrant Agent may deem necessary or desirable and that shall not adversely affect, alter or change the interests of the holders of the Warrants in any material respect; and

WHEREAS, the parties hereto desire that the Company assign to Parent all of the Company’s rights and interests and obligations in and under the Warrant Agreement, and Parent accept such assignment and assume all of the Obligations, in each case, effective as of the Effective Time.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Assignment and Assumption .

(a) Upon the Effective Time, the Company confirms that it hereby assigns, and Parent hereby assumes, the due and punctual observance and performance of each and every covenant and condition of the Warrant Agreement and the Warrants to be performed and observed by the Company and all of the obligations and liabilities thereunder; provided that, as determined by the resolutions of the Board of Directors of Parent, a copy of which has been made available to the Company prior to the date hereof, each Warrant shall thereafter, pursuant to Section 6.19 of the Merger Agreement, be exercisable solely for the right to receive the Merger Consideration that would have been issued or paid to the holders of the Warrants if such holders were to have exercised the Warrants immediately prior to the Effective Time.

(b) This Assumption Agreement is being executed and delivered pursuant and subject to the Warrant Agreement. Nothing in this Assumption Agreement shall, or shall be deemed to, defeat, limit, alter, impair, enhance or enlarge any right, obligation, claim or remedy created by the Warrant Agreement or any other document or instrument delivered pursuant to or in connection with it.

2. Miscellaneous .

(a) Governing Law . The validity, interpretation, and performance of this Assumption Agreement shall be governed by the laws of the State of Delaware, without regard to the provisions thereof relating to conflict of laws.

(b) Binding Effect . This Assumption Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective heirs, executors, legal representatives, administrators, successors and assigns, as applicable.

(c) Severability . Wherever possible, each provision of this Assumption Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Assumption Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Assumption Agreement.

(d) Amendment to Warrant Agreement . To the extent required by this Assignment Agreement, the Warrant Agreement is hereby deemed amended pursuant to Section 16 thereof to reflect the subject matter contained herein, effective as of the Effective Time.

(e) Counterparts . This Assumption Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

[ Signature Pages Follow ]

IN WITNESS WHEREOF , the parties hereto have executed this Assumption Agreement as of the date first written above.

 

[ Signature Page to Assumption Agreement ]

[ Signature Page to Assumption Agreement ]

[ Signature Page to Assumption Agreement ]

Exhibit 10.7

Execution Version

BORROWING BASE REDETERMINATION, COMMITMENT INCREASE

AND JOINDER AGREEMENT TO CREDIT AGREEMENT

This BORROWING BASE REDETERMINATION, COMMITMENT INCREASE AND JOINDER AGREEMENT TO CREDIT AGREEMENT (this “ Agreement ”), dated as of August 6, 2019, is by and among AMPLIFY ENERGY OPERATING LLC, a Delaware limited liability company (the “ Borrower ”), AMPLIFY ACQUISITIONCO LLC, a Delaware limited liability company and successor by conversion to Amplify Acquisitionco Inc. (“ Parent ”), each of the other undersigned guarantors (together with the Borrower, collectively, the “ Loan Parties ”), each of the Lenders (including each New Lender, as defined below) that is a signatory hereto and BANK OF MONTREAL, as administrative agent for the Lenders (in such capacity, together with its successors, the “ Administrative Agent ”) and as letter of credit issuer for the Lenders (in such capacity, together with its successors, the “ L/C Issuer ”).

Recitals

A. The Borrower, Parent (as successor by conversion to Amplify Acquisitionco Inc.), the Administrative Agent, the L/C Issuer, and the Lenders are parties to that certain Credit Agreement dated as of November 2, 2018 (as amended by that certain First Amendment to Credit Agreement dated as of May 5, 2019 (the “ First Amendment ”), and as further amended, restated, amended and restated, modified or otherwise supplemented from time to time prior to the date hereof, the “ Credit Agreement ”), pursuant to which the L/C Issuer and the Lenders have, subject to the terms and conditions set forth therein, made certain credit available to and on behalf of the Borrower.

B. Amplify Energy Corp., a Delaware corporation (the “ Amplify Parent ”), entered into that certain Agreement and Plan of Merger dated as of May 5, 2019 (the “ Merger Agreement ”), by and among the Amplify Parent, Midstates Holdings, Inc., a Delaware corporation (“ Merger Sub ”), and Midstates Petroleum Company, Inc., a Delaware corporation and now known as Amplify Energy Corp. (“ Public Parent ”), (i) pursuant to which Merger Sub merged with and into Amplify Parent, with Amplify Parent being the surviving entity (the “ Merger ”), and (ii) immediately following the effectiveness of the Merger, Amplify Parent merged with and into Alpha Mike Holdings, LLC, a Delaware limited liability company and now known as Amplify Energy Holdings LLC (“ Alpha Mike ”), with Alpha Mike being the surviving entity.

C. Upon the consummation of the Merger and the other transactions referenced in Recital B above, (i) Public Parent contributed the Equity Interests it owns in Midstates Petroleum Company LLC, a Delaware limited liability company and now known as Amplify Oklahoma Operating LLC (the “ Midstates Borrower ” and such Equity Interests, the “ Midstates Equity Interests ”), to its direct, wholly-owned subsidiary, Alpha Mike, (ii) Alpha Mike contributed the Midstates Equity Interests to its direct, wholly-owned subsidiary, Parent, and (iii) Parent contributed the Midstates Equity Interests to its direct, wholly-owned subsidiary, the Borrower (such contribution transactions, collectively, the “ Midstates Contribution ”).

 

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D. The Borrower delivered to the Administrative Agent and the Lenders that certain annual reserve report, dated as of January 1, 2019 by Cawley, Gillespie & Associates, Inc. on or about April 2, 2019 (the “ Midstates Reserve Report ”).

E. The Borrower has requested that, upon consummation of the Merger and the Midstates Contribution and the transactions related thereto, and the satisfaction of each of the conditions precedent set forth in Section  5 of this Agreement, (i) the Borrowing Base be redetermined and increased to give effect to the acquisition (by means of the Midstates Contribution) of the Oil and Gas Properties of the Midstates Borrower, (ii) the Aggregate Commitments be increased by increasing the Commitment of one or more Lenders or by causing one or more Persons that at such time are not Lenders to become Lenders, and (iii) certain amendments be made to the Credit Agreement.

F. In connection with this Agreement, the Borrower has requested that (i) each of SunTrust Bank and DNB Capital LLC (each a “ New Lender ”), severally and not jointly, join the Credit Agreement as a Lender, each with a Commitment in the amount as set forth opposite its respective name on Annex  I attached hereto, (ii) KeyBank, National Association (the “ Increasing Existing Lender ”, and collectively, with the New Lenders, the “ Increasing Lenders ”), increase its Commitment, and (iii) (in order for Increasing Existing Lender to increase its Commitment to the amount set forth opposite Increasing Existing Lender name on Annex  I attached hereto) Bank of Montreal, as a Lender (the “ Decreasing Lender ”), assign a portion of its existing Commitment to Increasing Existing Lender, such that, after giving effect to all of the foregoing joinders, new or increased Commitments, and assignments, the Lenders party to the Credit Agreement (including each New Lender) shall (x) have the respective Commitments set forth opposite each Lender’s respective name on Annex  I attached hereto and (y) hold the outstanding principal amount of Loans and Letters of Credit participations in accordance with such Commitments and the resulting Applicable Percentages.

G. The Borrower, Parent, the Administrative Agent, the L/C Issuer and the Lenders desire to enter into this Agreement, to among other things, increase the Borrowing Base, increase the Aggregate Commitments (including by joinder of certain New Lenders), and make certain amendments to the Credit Agreement.

H. NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Section 1. Defined Terms . Each capitalized term that is defined in the Credit Agreement, but that is not defined in this Agreement, shall have the meaning ascribed to such term in the Credit Agreement. Unless otherwise indicated, all section and exhibit references in this Agreement refer to the respective sections and exhibits in the Credit Agreement.

 

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Section 2. Redetermination of the Borrowing Base . Upon the Effective Date (as defined in Section  5 below), the Borrowing Base shall be redetermined and increased from $425,000,000 to $530,000,000 based on the Borrower’s most recently delivered Reserve Report and the Midstates Reserve Report, and taking into account the amount received by the Borrower from the Beta Decommissioning Trust (as defined in the Credit Agreement), which Borrowing Base shall remain in effect until otherwise redetermined in accordance with the Credit Agreement.

Section 3. Joinder of New Lenders; Increase in Commitments of Increasing Existing Lenders .

3.1 Upon the Effective Date, and by its execution and delivery hereof, each New Lender, severally and not jointly, shall, and does hereby, (i) join and become a party to the Credit Agreement with a Commitment as set forth opposite its name on the revised Schedule 2.01 attached hereto as Annex  I , (ii) obtain and have all the rights and obligations of a “Lender” under the Credit Agreement and the other Loan Documents as if it were a signatory thereto as of the Effective Date, and (iii) agree to be bound by the terms and conditions set forth in the Credit Agreement and the other Loan Documents to which the Lenders are a party, in each case, as if it were an original signatory thereto.

3.2 Each New Lender, severally and not jointly, (i) represents and warrants that (a) it has full power and authority, and has taken all action necessary, to execute and deliver this Agreement and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (b) it satisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to become a Lender, provide its respective Commitment and acquire its interest in the Loans and participation in Letters of Credit outstanding as of the Effective Date (after giving effect to this Agreement), (c) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of its respective Commitment, shall have the obligations of a Lender thereunder, (d) it has received a copy of the Credit Agreement as amended or otherwise modified and the other Loan Documents, together with copies of the most recent financial statements delivered pursuant to Section 6.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Agreement, become a Lender, provide its respective Commitment and acquire its interest in the Loans and participations in the Letters of Credit outstanding as of the Effective Date, on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent (or any Affiliate thereof acting in any capacity), any L/C Issuer or any other Lender and (e) it has delivered to the Administrative Agent an Administrative Questionnaire and (ii) agrees that (a) it will, independently and without reliance on the Administrative Agent (or any Affiliate thereof acting in any capacity), any L/C Issuer, or any other Lender, and based on such documents and information as it shall deem appropriate at the time, made its own credit analysis and decision to enter into this Agreement and to provide its respective Commitment and acquire its interest in the Loans and the participations of Letters of Credit outstanding as of the Effective Date, (b) appoints and authorizes the Administrative Agent to take such action on its behalf and to exercise such powers under the Credit Agreement and the other Loan Documents as are delegated to each such Person by the terms thereof, together with such powers as are reasonably incidental thereto, (c) appoints and authorizes all L/C Issuers to take such action on its behalf and to exercise such powers under the Credit Agreement and the other Loan Documents as are delegated to such Person by the terms thereof, together with such powers as are reasonably incidental thereto, and (d) agrees that (1) it will, independently and without reliance on the Administrative Agent, any L/C Issuer or any Lender,

 

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and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (2) it will perform in accordance with their terms all of the obligations that, by the terms of the Loan Documents, are required to be performed by it as a Lender.

3.3 Upon the Effective Date, and by its execution and delivery hereof, the Increasing Existing Lender (i) shall, and does hereby, increase its Commitment under the Credit Agreement to the amount as set forth opposite its name on the revised Schedule 2.01 attached hereto as Annex  I and (ii) represents and warrants to the Administrative Agent and each L/C Issuer that it has full power and authority, and has taken all action necessary, to execute and deliver this Agreement and to consummate the transactions contemplated hereby.

3.4 Upon the Effective Date, and by its execution and delivery hereof, the Decreasing Lender (i) shall, and does hereby, assign to the Increasing Existing Lender a portion of Decreasing Lender’s Commitment under the Credit Agreement as in effect immediately prior to the effectiveness of this Agreement such that, after giving effect to such assignment, the Decreasing Lender shall have the Commitment set forth opposite its name on the revised Schedule 2.01 attached hereto as Annex  I and (ii) represents and warrants to the Administrative Agent and each L/C Issuer that it has full power and authority, and has taken all action necessary, to execute and deliver this Agreement and to consummate the transactions contemplated hereby.

3.5 Schedule 2.01 of the Credit Agreement is hereby updated and revised in its entirety to reflect the Commitments of the Lenders (including the New Lenders) as set forth in Annex  I attached hereto after giving effect to the foregoing joinders, new Commitments, increase of Commitments and assignments.

Section 4. Renewal and Continuation of Existing Loans. As of the Effective Date:

4.1 All of the Loans outstanding under the Credit Agreement immediately prior to the Effective Date shall hereby be restructured, rearranged, renewed, extended and continued under the Credit Agreement and shall be Loans outstanding under the Credit Agreement. On the Effective Date, each Increasing Lender shall purchase a pro rata portion of the outstanding Loans (including participations in L/C Obligations) of each of the existing Lenders party to the Credit Agreement immediately prior to the Effective Date such that each Lender (including each New Lender and Increasing Existing Lenders) shall hold its respective Applicable Percentage of the outstanding Loans (and participation interests in participations in L/C Obligations) as reflected in the revised Schedule 2.01 attached hereto as Annex  I .

4.2 This Agreement is executed and delivered by the Increasing Lenders, the Borrower, the Administrative Agent and each L/C Issuer in lieu of the execution and delivery of Additional Lender Agreements or Increasing Lender Agreements, as applicable, otherwise contemplated by Section 2.04 of the Credit Agreement, and the requirements of Section 2.04 are hereby superseded with respect thereto.

 

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Section 5. Conditions Precedent to Effectiveness and Borrowing Base Increase . This Agreement shall become effective on the date (the “ Effective Date ”) on which each of the following conditions is satisfied:

5.1 The Administrative Agent shall have received executed signature pages to this Agreement from each of the Borrower, each other Loan Party, each Lender (including each New Lender), each L/C Issuer and the Administrative Agent.

5.2 The Administrative Agent shall have received reasonably satisfactory evidence that each of the conditions precedent set forth in Section 5.1 and 5.2 of the First Amendment have been satisfied.

5.3 The Administrative Agent shall have received (i) evidence that the Midstates Equity Interests has been contributed to the Borrower, and (ii) duly executed counterparts of a Pledge Agreement, or a supplement to the Borrower’s existing Pledge Agreement, from the Borrower pledging the Midstates Equity Interests, together with all certificates evidencing the Midstates Equity Interests and related blank stock powers from the Borrower.

5.4 The Administrative Agent shall have received duly authorized and executed counterparts of a Guaranty, or a supplement to Guaranty, and a Security Agreement, or a supplement to Security Agreement, from the Midstates Borrower, each in form and substance satisfactory to the Administrative Agent.

5.5 The Administrative Agent shall have received UCC financing statements in appropriate form for filing under the UCC for the Midstates Borrower with respect to its Security Agreement.

5.6 The Administrative Agent shall have received certified copies of UCC, tax and judgment lien searches, bankruptcy and pending lawsuit searches or equivalent reports or searches, each of a recent date listing all effective financing statements, lien notices or comparable documents that names any Loan Party, Public Parent, Alpha Mike, or the Midstates Borrower, as debtor, and that are filed in those states in which any Loan Party, Public Parent, Alpha Mike, or the Midstates Borrower, is organized and such other searches that the Administrative Agent deems necessary or appropriate, none of which shall encumber the Collateral covered or intended to be covered by the Security Instruments (other than Liens permitted by Section 7.01 of the Credit Agreement).

5.7 [Intentionally Omitted.]

5.8 The Administrative Agent shall have received a Note executed by the Borrower in favor of each Lender requesting a Note.

5.9 The Administrative Agent shall have received (or shall be reasonably satisfied that concurrently with the consummation of the Merger, it will receive) duly executed mortgage releases and terminations, terminations of any financing statements and terminations of control agreements, with respect to any and all Liens, in each case, encumbering the properties or assets (including oil and gas properties) of Public Parent, Alpha Mike or the Midstates Borrower,

 

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including, without limitation, any mortgages, financing statements, control agreements and other security documents securing the reserve based credit facility of the Midstates Borrower, Public Parent or its Subsidiaries, except to the extent any such Lien is permitted to remain in effect pursuant to Section 7.01 of the Credit Agreement. After giving effect to the Merger, the Midstates Contribution and the other transactions contemplated thereby, the Midstates Borrower shall not have any outstanding Indebtedness other than (i) the Obligations pursuant to the Loan Documents and (ii) other Indebtedness permitted to be incurred and remain outstanding pursuant to Section 7.03 of the Credit Agreement.

5.10 The Administrative Agent shall have received title information consistent with usual and customary standards for the geographic regions in which the Oil and Gas Properties of the Midstates Borrower are located, taking into account the size, scope and number of leases and wells of the Midstates Borrower; provided that after giving effect to its receipt of the title information to be provided pursuant to this Section  5.10 , the Administrative Agent shall be reasonably satisfied with the title information covering the Oil and Gas Properties comprising at least 85% of the total PV9 value of the Midstates Borrower’s Proved Reserves.

5.11 The Administrative Agent shall be reasonably satisfied with the environmental condition of the Oil and Gas Properties of the Midstates Borrower included in the Borrowing Base.

5.12 The Administrative shall have received, in form and substance reasonably satisfactory to the Administrative Agent and each of the Lenders:

(i) a duly authorized and executed certificate of a Responsible Officer of the Midstates Borrower certifying (a) that attached thereto is a true and complete copy of each Organization Document of such party, as applicable, certified (to the extent applicable) as of a recent date by the Secretary of State of the state of its organization, (b) that attached thereto is a true and complete copy of resolutions duly adopted by such party, as applicable, authorizing the execution, delivery and performance of the Loan Documents to which such party is a party and that such resolutions have not been modified, rescinded or amended and are in full force and effect and (c) as to the incumbency and specimen signature of each officer executing any Loan Document or any other document delivered in connection with this Agreement; and

(ii) a certificate as to the good standing of the Midstates Borrower, as of a recent date, from the applicable Secretary of State for the jurisdiction of such party’s incorporation or organization.

5.13 The Administrative Agent shall have received, on behalf of itself and the Lenders, a customary written opinion of Kirkland & Ellis, LLP, counsel for the Borrower, Midstates Borrower and the Loan Parties (i) addressed to the Administrative Agent and the Lenders and (ii) covering the Loan Documents, financing statements and such matters as the Administrative Agent shall reasonably request.

 

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5.14 The Administrative Agent and the Lenders shall have received at least three (3) Business Days prior to the Effective Date, the documentation and information required under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation, the information required under Section 10.17 of the Credit Agreement for Public Parent, Alpha Mike, Parent and the Midstates Borrower; provided that the Administrative Agent or any such Lender shall have requested such documentation and information at least seven days prior to the Effective Date.

5.15 Each of Parent, the Borrower and each other Loan Party shall have confirmed and acknowledged to the Administrative Agent and the Lenders, and by its execution and delivery of this Agreement each of Parent, the Borrower and each other Loan Party does hereby confirm and acknowledge to the Administrative Agent and the Lenders, that (i) the execution, delivery and performance of this Agreement has been duly authorized by all requisite corporate or limited liability company action, as applicable, on the part of Parent, the Borrower, and each other Loan Party, (ii) the Credit Agreement and each other Loan Document to which it is a party constitute valid and legally binding agreements enforceable against the each of Parent, Borrower and each other Loan Party in accordance with their respective terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or other similar laws relating to or affecting the enforcement of creditors’ rights generally and by general principles of equity, (iv) the representations and warranties by the each of Parent, Borrower and each other Loan Party contained in Article V of the Credit Agreement or any other Loan Document to which such entity is a party are true and correct on and as of the Effective Date in all material respects (or if such representation or warranty is qualified by or subject to a “materiality”, “material adverse effect”, “material adverse change” or any similar term or qualification, such representation or warranty shall be true and correct in all respects) as though made on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case was true and correct, in all material respects (or if such representation or warranty is qualified by or subject to a “materiality”, “material adverse effect”, “material adverse change” or any similar term or qualification, such representation or warranty shall continue to be true and correct in all respects) as of such earlier date, and (v) no Default or Event of Default exists under the Credit Agreement or any of the other Loan Documents.

For purposes of determining compliance with the conditions specified in Section  5 above, each Lender shall be deemed to have consented to, approved or accepted or be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received written notice from such Lender prior to the Effective Date specifying its objection thereto.

Section 6. Post-Closing . The Administrative Agent shall have received:

6.1 Within ten (10) Business Days of the Effective Date, (i) duly authorized and executed Mortgages, in form and substance reasonably acceptable to the Administrative Agent sufficient to grant, evidence and perfect first-priority Liens covering at least 85% of the of the aggregate PV9 Value of the Proved Reserves attributable to the Engineered Oil and Gas Properties included in the Borrower’s most recent Engineering Report provided to the Administrative Agent and the Lenders and the Midstates Reserve Report and (ii) customary written opinions of (i) Kirkland & Ellis, LLP, counsel for the Midstates Borrower and (ii) Hall Estill, local counsel for the Midstates Borrower in the State of Oklahoma, addressed to the Administrative Agent and the Lenders and covering such Mortgages, any related financing statements and such other matters as the Administrative Agent shall reasonably request.

 

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6.2 Within thirty (30) days of the Effective Date (or such date as agreed upon by the Administrative Agent in its reasonably discretion), the Administrative Agent shall have received evidence that all insurance policies maintained with respect to the Loan Parties (including Midstates Borrower) and their respective assets and properties, (i) name the Administrative Agent and the Lenders as additional insureds in respect of any liability policy and name the Administrative Agent as lender loss payee with respect to any property policy, and (ii) meet the terms and conditions required for insurance policies of such entities by Section 5.10 of the Credit Agreement.

Section 7. Agreement Fee . Upon the Effective Date, the Borrower shall pay to the Administrative Agent for the account of each Increasing Lender an upfront fee equal to fifty (50) basis points on the amount of such Lender’s new Commitment or incremental increase in Commitment (in the case of the Increasing Existing Lender) after giving effect to the Agreement.

Section 8. Miscellaneous .

8.1 Confirmation and Effect and No Waiver . The provisions of the Credit Agreement (as amended by this Agreement) shall remain in full force and effect in accordance with its terms following the effectiveness of this Agreement. Each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of like import shall mean and be a reference to the Credit Agreement as amended hereby, and each reference to the Credit Agreement in any other document, instrument or agreement executed and/or delivered in connection with the Credit Agreement shall mean and be a reference to the Credit Agreement as amended hereby. This Agreement is a Loan Document for all purposes under the Loan Documents. The execution, delivery and effectiveness of this Agreement shall not operate as a waiver of any default of Parent, Borrower or any other Loan Party or any right, power or remedy of the Administrative Agent or the Lenders under any of the Loan Documents, nor constitute a waiver of any provision of any of the Loan Documents. This Agreement shall serve as an amendment to the Credit Agreement, but shall not extinguish or novate the Loans or any other Obligation under the Credit Agreement.

8.2 Ratification and Affirmation of Loan Parties . Each of Parent, Borrower and each of the other Loan Parties hereby expressly (a) acknowledges the terms of this Agreement, (b) ratifies and affirms all of their respective Obligations and each of their other obligations under the Credit Agreement and the other Loan Documents to which it is a party, as amended hereby, (c) acknowledges, renews and extends its continued liability under the Credit Agreement and the other Loan Documents to which it is a party, as amended hereby, (d) ratifies and affirms all Liens granted by it pursuant to the Loan Documents to secure the Secured Obligations (except to the extent that such Liens have been released in accordance with the Loan Documents) and affirms that after giving effect to this Agreement, the terms of the Security Instruments secure, and will continue to secure, all Secured Obligations thereunder, and (e) agrees that its guarantee under the Guaranty, if applicable, and the other Loan Documents to which it is a party, as amended hereby, remains in full force and effect with respect to the Obligations.

8.3 Counterparts . This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or electronic (e.g., pdf) transmission shall be effective as delivery of a manually executed original counterpart hereof.

 

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8.4 No Oral Agreement . T HIS WRITTEN A GREEMENT , THE C REDIT A GREEMENT AND THE OTHER L OAN D OCUMENTS EXECUTED IN CONNECTION HEREWITH AND THEREWITH REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR , CONTEMPORANEOUS , OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES . T HERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES .

8.5 Governing Law . T HIS A GREEMENT ( INCLUDING , BUT NOT LIMITED TO , THE VALIDITY AND ENFORCEABILITY HEREOF ) SHALL BE GOVERNED BY , AND CONSTRUED IN ACCORDANCE WITH , THE LAWS OF THE S TATE OF N EW Y ORK .

8.6 Payment of Expenses . The Borrower agrees to pay or reimburse the Administrative Agent for fees and expenses in connection with this Agreement pursuant to the terms and conditions of Section 10.04 of the Credit Agreement.

8.7 Severability . If any provision of this Agreement is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

8.8 Successors and Assigns . This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns as permitted under Section 10.06 of the Credit Agreement.

[ Signature pages follow ]

 

9

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed effective as of the date first written above.

 

BORROWER:				AMPLIFY ENERGY OPERATING LLC,
				a Delaware limited liability company,
				as the Borrower
				By:		/s/ Martyn Willsher
				Name:		Martyn Willsher
				Title:		Senior Vice President and Chief Financial Officer
PARENT:				AMPLIFY ACQUISITIONCO LLC,
				a Delaware limited liability company,
				as Parent
				By:		/s/ Martyn Willsher
				Name:		Martyn Willsher
				Title:		Senior Vice President and Chief Financial Officer
INTERMEDIATE PARENT:				AMPLIFY ENERGY HOLDINGS LLC,
				a Delaware limited liability company,
				as Intermediate Parent
				By:		/s/ Martyn Willsher
				Name:		Martyn Willsher
				Title:		Senior Vice President and Chief Financial Officer
PUBLIC PARENT:				AMPLIFY ENERGY CORP.,
				a Delaware corporation,
				as Public Parent
				By:		/s/ Martyn Willsher
				Name:		Martyn Willsher
				Title:		Senior Vice President and Chief Financial Officer

GUARANTORS:				AMPLIFY ENERGY SERVICES LLC,
				a Delaware limited liability company
				By:		/s/ Martyn Willsher
				Name:		Martyn Willsher
				Title:		Senior Vice President and Chief Financial Officer
				BETA OPERATING COMPANY, LLC,
				a Delaware limited liability company
				By:		/s/ Martyn Willsher
				Name:		Martyn Willsher
				Title:		Senior Vice President and Chief Financial Officer
				SAN PEDRO BAY PIPELINE COMPANY,
				a California corporation
				By:		/s/ Martyn Willsher
				Name:		Martyn Willsher
				Title:		Senior Vice President and Chief Financial Officer
				AMPLIFY OKLAHOMA OPERATING LLC,
				a Delaware limited liability company
				By:		/s/ Martyn Willsher
				Name:		Martyn Willsher
				Title:		Senior Vice President and Chief Financial Officer

ADMINISTRATIVE AGENT:				BANK OF MONTREAL, as Administrative Agent,
				an L/C Issuer, and as a Lender
				By:		/s/ James V. Ducote
				Name:		James V. Ducote
				Title:		Managing Director

LENDER:				BANK OF AMERICA, N.A., as a Lender
				By:		/s/ Raza Jafferi
				Name:		Raza Jafferi
				Title:		Director

LENDER:				CITIBANK, N.A., as a Lender
				By:		/s/ Cliff Vaz
				Name:		Cliff Vaz
				Title:		Vice President

LENDER:				REGIONS BANK, as a Lender
				By:		/s/ Tyler Nissen
				Name:		Tyler Nissen
				Title:		Associate

LENDER:				U.S. BANK NATIONAL ASSOCIATION,
				as a Lender
				By:		/s/ John C. Lozano
				Name:		John C. Lozano
				Title:		Senior Vice President

LENDER:				CANADIAN IMPERIAL BANK OF COMMERCE, NEW YORK BRANCH, as a Lender
				By:		/s/ Donovan C. Broussard
				Name:		Donovan C. Broussard
				Title:		Authorized Signatory
				By:		/s/ Trudy Nelson
				Name:		Trudy Nelson
				Title:		Authorized Signatory

LENDER:				KEYBANK, NATIONAL ASSOCIATION,
				as a Lender
				By:		/s/ George E. McKean
				Name:		George E. McKean
				Title:		Senior Vice President

LENDER:				HANCOCK WHITNEY BANK, as a Lender
				By:		/s/ Parker Mears
				Name:		Parker Mears
				Title:		Senior Vice President

LENDER:				UBS AG, STAMFORD BRANCH, as a Lender
				By:		/s/ Darlene Arias
				Name:		Darlene Arias
				Title:		Director
				By:		/s/ Robert Khan
				Name:		Robert Khan
				Title:		Associate Director

LENDER:				GOLDMAN SACHS BANK USA, as a Lender
				By:		/s/ Jamie Minieri
				Name:		Jamie Minieri
				Title:		Authorized Signatory

LENDER:				DNB CAPITAL LLC, as a Lender
				By:		/s/ Kelton Glasscock
				Name:		Kelton Glasscock
				Title:		Senior Vice President
				By:		/s/ James Grubb
				Name:		James Grubb
				Title:		First Vice President

LENDER:				SUNTRUST BANK, as a Lender
				By:		/s/ Brian Guffin
				Name:		Brian Guffin
				Title:		Managing Director

Exhibit 10.12

EXECUTION VERSION

 

		Amplify Energy Corp. 500 Dallas Street, Suite 1600 Houston, TX 77002   (713) 490-8900

EMPLOYMENT AGREEMENT

May 23, 2018

This Employment Agreement (“ Agreement ”) is entered into by and between AMPLIFY ENERGY CORP. , a Delaware corporation (the “ Company ”), and POLLY SCHOTT (the “ Employee ”), effective as of June 11, 2018 (the “ Effective Date ”), on the terms set forth herein. The Company and Employee may sometimes hereafter be referred to singularly as a “ Party ” or collectively as the “ Parties .”

Accordingly, the Parties, intending to be legally bound, agree as follows:

 

1.	Position and Duties.

1.1 Employment; Titles; Reporting . The Company agrees to employ the Employee and the Employee agrees to commence employment with the Company, upon the terms and subject to the conditions provided under this Agreement. During the Employment Term (as defined in Section 2 ), the Employee will serve the Company as its Chief Administrative Officer. In such capacity, the Employee will report to the Chief Executive Officer of the Company (the “CEO”) and otherwise will be subject to the direction and control of the CEO, and the Employee will have such duties, responsibilities and authorities as may be assigned to the Employee by the CEO from time to time to the extent consistent with her position as the chief administrative officer in a publicly traded company comparable to the Company.

1.2 Duties . During the Employment Term, the Employee will devote substantially all of the Employee’s full working time to the business and affairs of the Company, will use the Employee’s best efforts to promote the Company’s interests and will perform the Employee’s duties and responsibilities faithfully, diligently and to the best of the Employee’s ability, consistent with sound business practices. The Employee may be required by the CEO and/or the Board of Directors of the Company (the “ Board ”) to provide services to, or otherwise serve as an officer or director of, any direct or indirect subsidiary of the Company. The Employee will comply with the Company’s policies, codes and procedures, as they may be in effect from time to time, applicable to executive officers of the Company. Subject to the preceding sentence, the Employee may, with the prior written approval of the Board in each instance, engage in other business and charitable activities, provided that such charitable and/or other business activities do not violate Section 7 , create a conflict of interest or the appearance of a conflict of interest with the Company, or interfere, individually or in the aggregate, with the performance of the Employee’s obligations to the Company under this Agreement.

1.3 Place of Employment . The Employee will perform the Employee’s duties under this Agreement at the Company’s offices in Houston, Texas. The Employee understands and agrees that she will be required to travel from time to time for purposes of the Company’s business.

2.	Term of Employment.

The term of the Employee’s employment by the Company under this Agreement (the “ Employment Term ”) will commence on the Effective Date and will continue until the Employee’s employment is terminated by either Party under Section  5 . The date on which the Employee’s employment ends is referred to in this Agreement as the “ Termination Date .” For the purpose of Sections 5 and 6 of this Agreement, the Termination Date shall be the date upon which the Employee incurs a “separation from service” as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the “ Code ”), and regulations issued thereunder (collectively, “ Code Section  409A ”).

 

3.	Compensation.

3.1 Base Salary . During the Employment Term, the Employee will be entitled to receive a base salary (“ Base Salary ” ) at an annual rate of not less than $300,000 for services rendered to the Company and any of its direct or indirect subsidiaries, payable in accordance with the Company’s regular payroll practices. The Employee’s Base Salary shall be reviewed annually by the Board and may be adjusted upward in the Board’s sole discretion, but not downward.

3.2 Bonus Compensation . During the Employment Term, the Employee shall be eligible for discretionary bonus compensation with a target of 75% of the Employee’s Base Salary (the “ Target Bonus ” ) for each complete calendar year that the Employee is employed by the Company hereunder (any bonus compensation payable, the “ Annual Bonus ” ). The performance targets that must be achieved in order to be eligible for certain bonus levels shall be established by the Board (or a committee thereof) annually. Notwithstanding the foregoing, the Employee shall be eligible to receive a pro rata bonus for the portion of the 2018 calendar year that the Employee is employed by the Company hereunder (the “ 2018 Bonus ” ). Each Annual Bonus (including the 2018 Bonus), if any, shall be paid as soon as administratively feasible after the Board (or a committee thereof) certifies whether the applicable performance targets for the applicable calendar year have been achieved, but in no event later than March  15 following the end of such calendar year. Notwithstanding anything in this Section  3.2 to the contrary, but subject to Section  6 below, no Annual Bonus (including the 2018 Bonus), if any, nor any portion thereof, shall be payable for any calendar year unless the Employee remains continuously employed by the Company from the Effective Date through the date on which such Annual Bonus or 2018 Bonus is paid. Any Annual Bonus will be paid in the form of (a) cash, with respect to 25% of the amount of the Annual Bonus, and (b)  fully-vested shares of the Company’s common stock having an aggregate fair market value on the grant date (as determined by the Board) equal to 75% of the amount of the Annual Bonus.

3.3 Long-Term Incentive Compensation . Within 30 days of the Effective Date, the Employee shall receive a grant of 80,000 restricted stock units (“ RSUs ”) under the Company’s Management Incentive Plan (as it may be amended from time to time), which RSUs will be subject to vesting in accordance with, and the other terms and conditions set forth in, the form of award agreement attached hereto as Exhibit A . Thereafter, long-term incentive compensation awards may be made to the Employee from time to time during the Employment Term by the Board in its sole discretion, whose decision will be based upon performance and award guidelines for executive officers of the Company established periodically by the Board in its sole discretion.

 

2

4.	Expenses and Other Benefits.

4.1 Reimbursement of Business Expenses . The Employee will be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Employee during the Employment Term (in accordance with the policies and practices presently followed by the Company or as may be established by the Board from time to time for the Company’s senior executive officers) in performing services under this Agreement, provided that the Employee properly accounts for such expenses in accordance with the Company’s policies as in effect from time to time. Each reimbursement shall be paid within 30 days after it has been properly submitted to the Company by the Employee in accordance with all applicable policies, but in no event later than the end of the calendar year following the calendar year in which any such reimbursable expense was incurred.

The Company shall not be obligated to pay any such reimbursement amount for which the Employee fails to submit an invoice or other documented reimbursement request at least ten business days before the end of the calendar year next following the calendar year in which the expense was incurred. Business related expenses shall be reimbursable only to the extent they were incurred during the Employment Term, but in no event shall the time period extend beyond the later of the lifetime of the Employee or, if longer, 20 years. The amount of such reimbursements that the Company is obligated to pay in any given calendar year shall not affect the amount the Company is obligated to pay in any other calendar year. In addition, the Employee may not liquidate or exchange the right to reimbursement of such expenses for any other benefits.

4.2 Paid Time Off . The Employee shall be entitled to paid time off in accordance with the Company’s policy as then in effect (prorated for any calendar year during which the Employee is employed with the Company for less than the entire year, based on the number of days that the Employee is employed with the Company during such calendar year); the Company’s policy in effect as of the Effective Date would provide the Employee with 200 hours of paid time off per calendar year.

4.3 Other Employee Benefits . In addition to the foregoing, during the Employment Term, the Employee will be entitled to participate in and to receive benefits as a senior executive under all of the Company’s employee benefit plans, programs and arrangements available to senior executives, subject to the eligibility criteria and other terms and conditions thereof, as such plans, programs and arrangements may be duly amended, terminated, approved or adopted by the Company from time to time.

 

5.	Termination of Employment.

5.1 Death . The Employee’s employment under this Agreement will terminate upon the Employee’s death.

5.2 Termination by the Company .

(a) Terminable at Will. The Company may terminate the Employee’s employment under this Agreement at any time with or without Cause (as defined below).

 

3

(b) Definition of Cause. For purposes of this Agreement, “ Cause ” means any of the Employee’s: (1) conviction of a felony, or plea of guilty or nolo contendere to, any felony or any crime of moral turpitude; (2) repeated intoxication by alcohol or drugs during the performance of the Employee’s duties; (3) embezzlement or other willful and intentional misuse of any of the funds of the Company or its direct or indirect subsidiaries, (4) commission of a demonstrable act of fraud; (5) willful and material misrepresentation or concealment on any written reports submitted to the Company or its direct or indirect subsidiaries; (6) material breach of this Agreement; (7) failure to follow or comply with the reasonable, material and lawful written directives of the Board; or (8) conduct constituting a material breach of the Company’s then-current code of conduct or other similar written policy which has been provided to the Employee.

(c) Notice and Cure Opportunity in Certain Circumstances. The Employee may be afforded a reasonable opportunity to cure any act or omission that would otherwise constitute Cause hereunder according to the following terms: The Board shall give the Employee written notice stating with reasonable specificity the nature of the circumstances determined by the Board in its reasonable and good faith judgment to constitute Cause. If, in the reasonable and good faith judgment of the Board, the alleged breach is reasonably susceptible to cure, the Employee will have 15 days from the Employee’s receipt of such notice to effect the cure of such circumstances or such breach to the reasonable and good faith satisfaction of the Board. The Board will state whether the Employee will have such an opportunity to cure in the initial notice of Cause referred to above. Prior to a termination for Cause, in those instances where the initial notice of Cause states that the Employee will have an opportunity to cure, the Company shall provide an opportunity for the Employee to be heard by the Board or a Board committee designated by the Board to hear the Employee. The decision as to whether the Employee has satisfactorily cured the alleged breach shall be made at such meeting. If, in the reasonable and good faith judgment of the Board, the alleged breach is not reasonably susceptible to cure, or such circumstances or breach have not been satisfactorily cured within such 15 day cure period, such breach will thereupon constitute Cause hereunder.

5.3 Termination by the Employee .

(a) Terminable at Will. The Employee may terminate the Employee’s employment under this Agreement at any time with or without Good Reason (as defined below).

(b) Notice and Cure Opportunity. If such termination is for Good Reason, the Employee will give the Company written notice, which will identify with reasonable specificity the grounds for the Employee’s resignation and provide the Company with 30 days from the day such notice is given to cure the alleged grounds for resignation contained in the notice. A termination will not be for Good Reason if such notice is given by the Employee to the Company more than 45 days after the first occurrence of the event that the Employee alleges is Good Reason for the Employee’s termination hereunder. The Employee must actually terminate her employment within 30 days following the expiration of the Company’s 30-day cure period. Otherwise, any claim of such circumstances constituting “Good Reason” shall be deemed irrevocably waived by the Employee.

 

4

(c) Definition of Good Reason. For purposes of this Agreement, “ Good Reason ” will mean any of the following to which the Employee will not consent in writing: (i) a relocation of the Employee’s principal work location to a location in excess of 40 miles from its then current location; (ii) a reduction in the Employee’s then current Base Salary or Target Bonus, or both; (iii) a material breach of any provision of this Agreement by the Company; or (iv) any material reduction in the Employee’s title, authority, duties, responsibilities or reporting relationship from those in effect as of the Effective Date, except to the extent such reduction occurs in connection with the Employee’s termination of employment for Cause or due to the Employee’s death or Disability.

5.4 Notice of Termination . Any termination of the Employee’s employment by the Company or by the Employee during the Employment Term (other than termination pursuant to Section  5.1 ) will be communicated by written Notice of Termination to the other Party hereto in accordance with Section  8.7 . For purposes of this Agreement, a “ Notice of Termination ” means a written notice that (a) indicates the specific termination provision in this Agreement relied upon, (b)  to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Employee’s employment under the provision so indicated, and (c)  if the Termination Date is other than the date of receipt of such notice, specifies the Termination Date (which Termination Date will be not more than 30 days after the giving of such notice).

5.5 Disability . If the Company determines in good faith that the Disability (as defined herein) of the Employee has occurred during the Employment Term, it may, without breaching this Agreement, give to the Employee written notice in accordance with Section  5.4 of its intention to terminate the Employee’s employment. In such event, the Employee’s employment with the Company will terminate effective on the 30th day after receipt of such notice by the Employee, provided that, within 30 days after such receipt, the Employee has not returned to full-time performance of the Employee’s duties hereunder.

“ Disability ” means the earlier of (a) written determination by a physician selected by the Company and reasonably agreed to by the Employee that the Employee has been unable to perform substantially the Employee’s usual and customary duties under this Agreement for a period of at least 120 consecutive days or a non-consecutive period of 180 days during any 12-month period as a result of incapacity due to mental or physical illness or disease; and (b) “disability” as such term is defined in the Company’s applicable long-term disability insurance plan. At any time and from time to time, upon reasonable request therefor by the Company, the Employee will submit to reasonable medical examination for the purpose of determining the existence, nature and extent of any such disability. Any physician selected by Company shall be Board Certified in the appropriate field and shall have no actual or potential conflict of interest.

 

6.	Compensation of the Employee Upon Termination . Subject to the provisions of Section  6.9 , the Employee shall be entitled to receive the amount specified upon the termination events designated below:

6.1 Death . If the Employee’s employment under this Agreement is terminated by reason of the Employee’s death, the Company shall pay to the person or persons designated by the Employee for that purpose in a notice filed with the Company, or, if no such person has been so designated, to the Employee’s estate, the following:

(a) an amount equal to the Employee’s accrued but unpaid then current Base Salary through the Termination Date, payable in a lump sum within 30 days following the Termination Date;

 

5

plus

(b) if the Termination Date occurs after the end of the calendar year but prior to the date on which annual bonuses are paid, an amount equal to the Annual Bonus that the Employee would have received (if any) had she been employed on the payment date (the “ Actual Full Year Bonus Amount ”), payable at the same time annual bonuses for such year are paid to actively-employed senior executives of the Company;

plus

(c) a pro-rata portion of the Employee’s Annual Bonus for the calendar year in which the Employee’s Termination Date occurs, based on actual results for such year (determined by multiplying the amount of such Annual Bonus which would be due for the full calendar year by a fraction, (i) the numerator of which is the number of days during the calendar year that the Employee is employed by the Company and (ii) the denominator of which is three hundred sixty-five (365)) (the “ Actual Pro Rata Bonus Amount ”), if any, payable at the same time annual bonuses for such year are paid to actively-employed senior executives of the Company;

plus

(d) any other amounts that may be reimbursable by the Company to the Employee as expressly provided under this Agreement, payable in a lump sum within 30 days following the Termination Date.

The Employee’s entitlement to the amounts set forth in Section  6.1(b) and Section  6.1(c) is subject to the provisions of Section  6.5.

Thereafter, the Company will have no further obligation to the Employee under this Agreement, other than for payment of any amounts accrued and vested under any employee benefit plans or programs of the Company and any payments or benefits required to be made or provided under applicable law.

6.2 Disability . In the event of the Employee’s termination by reason of Disability pursuant to Section  5.5 , the Employee will continue to receive the Employee’s Base Salary in effect immediately prior to the Termination Date and participate in applicable employee benefit plans or programs of the Company through the Termination Date, subject to offset dollar-for-dollar by the amount of any disability income payments provided to the Employee under any Company disability policy or program that is maintained by the Company. The Company also shall pay to the Employee the amounts set forth in Section  6.1(a) through Section  6.1(d) , at the times and subject to the conditions set forth in Section  6.1 . Thereafter, the Company will have no further obligation to the Employee under this Agreement, other than for payment of any amounts accrued and vested under any employee benefit plans or programs of the Company and any payments or benefits required to be made or provided under applicable law.

 

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6.3 By the Company for Cause or by the Employee Without Good Reason .

(a) Termination by Company For Cause. If the Employee’s employment is terminated by the Company for Cause, the Employee will receive (i) the Employee’s accrued but unpaid then current Base Salary through the Termination Date and (ii) any other amounts that may be reimbursable by the Company to the Employee as expressly provided under this Agreement, in each case, payable in a lump sum within 30 days following the Termination Date. Thereafter, the Company will have no further obligation to the Employee under this Agreement, other than for payment of any amounts accrued and vested under any employee benefit plans or programs of the Company, and any payments or benefits required to be made or provided under applicable law. No bonus will be paid to the Employee for a termination of the Employee’s employment for Cause.

(b) Termination by Employee Without Good Reason . If the Employee’s employment is terminated by the Employee without Good Reason, the Employee will receive (i) the Employee’s accrued but unpaid then current Base Salary through the Termination Date and (ii) any other amounts that may be reimbursable by the Company to the Employee as expressly provided under this Agreement, in each case, payable in a lump sum within 30 days following the Termination Date. Thereafter, the Company will have no further obligation to the Employee under this Agreement, other than for payment of any amounts accrued and vested under any employee benefit plans or programs of the Company, and any payments or benefits required to be made or provided under applicable law. No bonus will be paid to the Employee for a termination of the Employee’s employment without Good Reason.

6.4 By the Employee for Good Reason or by the Company Without Cause . Subject to the provisions of Section  6.5 , if the Company terminates the Employee’s employment without Cause, or the Employee terminates her employment for Good Reason, then the Employee will be entitled to the following (with the amounts payable under clauses (b), (c), (e) and (f) below, collectively, the “ Severance Benefits ” ):

(a) an amount equal to the Employee’s accrued but unpaid then current Base Salary through the Termination Date, payable in a lump sum within 30 days following the Termination Date;

plus

(b) if the Termination Date occurs after the end of the calendar year but prior to the date on which annual bonuses are paid, the Actual Full Year Bonus Amount, payable at the same time annual bonuses for such year are paid to actively-employed senior executives of the Company;

plus

(c) the Actual Pro Rata Bonus Amount, if any, payable at the same time annual bonuses for such year are paid to actively-employed senior executives of the Company;

 

7

plus

(d) any other amounts that may be reimbursable by the Company to the Employee as expressly provided under this Agreement;

plus

(e) (i) if the Employee’s termination occurs on or prior to the 18-month anniversary of the Effective Date, an amount equal to the Employee’s monthly Base Salary rate as in effect on the day before the Termination Date (but not as an employee), and (ii) if the Employee’s termination occurs after the 18-month anniversary of the Effective Date, an amount equal to 200% of the Employee’s monthly Base Salary rate as in effect on the day before the Termination Date, in each case, payable in accordance with the Company’s regularly scheduled payroll practices for a period of 12 months following the Termination Date; provided that to the extent the payment of any amount constitutes “nonqualified deferred compensation” for purposes of Code Section 409A, any such payment scheduled to occur during the first 60 days following the Termination Date shall not be paid until the first regularly scheduled pay period following the 60 ^th day after the Termination Date and shall include payment of any amount that was otherwise scheduled to be paid prior thereto;

plus

(f) subject to the Employee’s (i) timely election of continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“ COBRA ”), and (B) continued copayment of premiums at the same level and cost to the Employee as if the Employee were a senior executive of the Company (excluding, for purposes of calculating cost, an employee’s ability to pay premiums with pre-tax dollars), continued participation in the Company’s group health plan (to the extent permitted under applicable law and the terms of such plan) which covers the Employee (and her spouse and eligible dependents, if applicable) for a period of 12 months, provided that the Employee is eligible and remains eligible for COBRA coverage; provided, further, that the Company may modify the continuation coverage contemplated by this Section  6.4(f) to the extent reasonably necessary to avoid the imposition of any excise taxes on the Company for failure to comply with the nondiscrimination requirements of the Patient Protection and Affordable Care Act of 2010, as amended, and/or the Health Care and Education Reconciliation Act of 2010, as amended (to the extent applicable); and provided, further, that in the event that the Employee obtains other employment that offers group health plan coverage, such continuation of coverage by the Company under this Section  6.4(f) shall cease as of the end of the month in which the Employee obtains such other employer-provided, group health plan coverage.

6.5 Conditions to Receipt of Certain Post-Termination Payments and Benefits.

(a) Release . As a condition to receiving the Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section  6.1 , Section  6.2 or Section  6.4 , the Employee must execute and not revoke a general release of claims, which will include an affirmation of the restrictive covenants set forth in Section  7 , in form and substance satisfactory to the Company (the “ Release ”). The Company will provide the Release to the Employee for signature within ten days after the Termination Date. If the Company has provided the Release to the Employee for

 

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signature within ten days after the Termination Date, and if the Release is not executed and non-revocable within 60 days after the Termination Date and prior to the date on which such payment and/or benefits are to be first paid or provided to the Employee, the Employee will not be entitled to the Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits, as the case may be, and the Company will have no further obligations with respect to the provision of those payments and/or benefits except as may be required by law. If the Release consideration period spans two calendar years, no payments and/or benefits subject to the Release will be paid or provided until the later of (i) the date on which the Release becomes effective and non-revocable and (ii) January 2 ^nd of the second calendar year.

(b) Limitation on Benefits. If, following a termination of employment that gives the Employee a right to the payment of the Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section  6.1 , Section  6.2 or Section  6.4 , the Employee violates any of the covenants in Section  7 or as otherwise set forth in the Release, the Employee will have no further right or claim to the Actual Full Year Bonus Amount, the Target Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section  6.1 , Section  6.2 or Section  6.4 from and after the date on which the Employee engages in such activities, and the Company will have no further obligations with respect to such payments or benefits, and the covenants in Section  7 will nevertheless continue in full force and effect.

6.6 Certain Amounts Not Includable for Employee Benefits Purposes . Except to the extent the terms of any applicable benefit plan, policy or program provide otherwise, any benefit programs of the Company that take into account the Employee’s income will exclude the Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section 6.1 , Section 6.2 or Section 6.4 .

6.7 Exclusive Severance Benefits . The Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section 6.1 , Section 6.2 or Section 6.4 , if they become payable under the terms of this Agreement, will be in lieu of any other severance or similar benefits that would otherwise be payable under any other agreement, plan, program or policy of the Company, excluding, for this purpose, any post-termination treatment of equity incentive awards provided under the terms of the governing award agreements.

6.8 Code Section 280G; Code Section 409A . Notwithstanding anything in this Agreement to the contrary:

(a) If any of the payments or benefits received or to be received by the Employee (including, without limitation, any payment or benefits received in connection with a “change of control” or the Employee’s termination of employment, whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement, or otherwise) (all such payments collectively referred to herein as the (“ 280G Payments ”) constitute “parachute payments” within the meaning of Section 280G of the Code and would, but for this Section  6.8(a) , be subject to the excise tax imposed under Section 4999 of the Code (the “ Excise Tax ”), then prior to making the 280G Payments, a calculation shall be made comparing (i) the Net Benefit (as defined below) to the Employee of the 280G Payments after payment of the Excise Tax to (ii) the Net Benefit to the

 

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Employee if the 280G Payments are limited to the extent necessary to avoid being subject to the Excise Tax. Only if the amount calculated under clause (i) above is less than the amount under clause (ii) above will the 280G Payments be reduced to the minimum extent necessary to ensure that no portion of the 280G Payments is subject to the Excise Tax. “ Net Benefit ” shall mean the present value of the 280G Payments net of all federal, state, local, foreign income, employment and excise taxes. Any reduction made pursuant to this Section  6.8(a) shall be made in a manner determined by the Company that is consistent with the requirements of Code Section 409A and that maximizes the Employee’s economic position and after-tax income; for the avoidance of doubt, the Employee shall not have any discretion in determining the manner in which the payments and benefits are reduced.

(b) In the event that any benefits payable or otherwise provided under this Agreement would be deemed to constitute non-qualified deferred compensation subject to Code Section 409A, the Company will have the discretion to adjust the terms of such payment or benefit (but not the amount or value thereof) to the minimum extent reasonably necessary to comply with the requirements of Code Section 409A to avoid the imposition of any excise tax or other penalty with respect to such payment or benefit under Code Section 409A.

6.9 Timing of Payments by the Company . Notwithstanding anything in this Agreement to the contrary, in the event that the Employee is a “specified employee” (as determined under Code Section 409A) at the time of the separation from service triggering the payment or provision of benefits, any payment or benefit under this Agreement which is determined to provide for a deferral of compensation pursuant to Code Section 409A shall not commence being paid or made available to the Employee until after six months from the Termination Date that constitutes a “separation from service” within the meaning of Code Section 409A or such earlier date as may be permitted under Code Section  409A.

 

7.	Restrictive Covenants.

7.1 Confidential Information . During the Employment Term and thereafter, the Employee shall keep secret and retain in strictest confidence, and shall not use for the benefit of himself or others, any confidential matters or trade secrets of, or confidential and competitively valuable information concerning, the Company and its direct or indirect subsidiaries (collectively, the “ Company Group ”), including, without limitation, information concerning their organization and operations, business and affairs, formulae, manufacturing processes, proprietary information, technical data, “know-how”, customer lists, details of client or consultant contracts, vendor and purchasing arrangements, terms and discounts, pricing methods and policies, financial information, operational methods, marketing plans or strategies, business acquisition plans, new personnel acquisition plans, technical processes, projects, financing/financial projections, budget information and procedures, marketing plans or strategies, and research products. The confidentiality obligations set forth in this Section  7.1 shall not apply to any information that becomes part of the public domain other than through the Employee’s disclosure in violation of the terms hereof. Nothing herein shall be construed as prohibiting the Employee from using or disclosing such confidential information as is necessary and has been authorized in her proper performance of services for the Company Group.

 

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(a) SEC Provisions . The Employee understands that nothing contained in this Agreement limits the Employee’s ability to file a charge or complaint with the Securities and Exchange Commission (“ SEC ”). The Employee further understands that this Agreement does not limit the Employee’s ability to communicate with the SEC or otherwise participate in any investigation or proceeding that may be conducted by the SEC, including providing documents or other information, without notice to the Company. This Agreement does not limit the Employee’s right to receive an award for information provided to the SEC. This Section  7.1(a) applies only for the period of time that the Company is subject to the Dodd-Frank Act.

(b) Trade Secrets . The parties specifically acknowledge that 18 U.S.C. § 1833(b) provides: “An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that—(A) is made—(i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.” Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b). Accordingly, notwithstanding anything to the contrary in the foregoing, the Parties have the right to disclose in confidence trade secrets to federal, state, and local government officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law. If the Employee files a lawsuit for retaliation against the Company for reporting a suspected violation of law, the Employee may disclose the Company’s trade secrets to the Employee’s attorney and use the trade secret information in the court proceeding, if the Employee first files any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order.

7.2 No Interference . Notwithstanding any other provision of this Agreement, (a)  the Employee may disclose confidential information (as described in Section 7.1 above) when required to do so by a court of competent jurisdiction, by any governmental agency having authority over the Employee or the business of the Company or by any administrative body or legislative body (including a committee thereof) with jurisdiction to order the Employee to divulge, disclose or make accessible such information, in each case, subject to the Employee’s obligations to notify the Company and first obtain a protective order, to the extent permitted by applicable law; and (b)  nothing in this Agreement is intended to interfere with the Employee’s right to (i)  report possible violations of state or federal law or regulation to any governmental or law enforcement agency or entity; (ii)  make other disclosures that are protected under the whistleblower provisions of state or federal law or regulation (including the right to receive an award for information provided to any such government agencies); (iii) file a claim or charge any governmental agency or entity; or (iv)  testify, assist or participate in an investigation, hearing, or proceeding conducted by any governmental or law enforcement agency or entity, or any court. For purposes of clarity, in making or initiating any such reports or disclosures or engaging in any of the conduct outlined in subsection (b)  above, the Employee may disclose confidential information to the extent necessary to such governmental or law enforcement agency or entity or such court, need not seek prior authorization from the Company and is not required to notify the Company of any such reports, disclosures or conduct.

 

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7.3 Return of Property . The Employee agrees to deliver promptly to the Company, upon termination of the Employee’s employment hereunder, or at any other time when the Company so requests, all documents relating to the business of the Company Group; provided, however, that the Employee will be permitted to retain copies of any documents or materials of a personal nature or otherwise related to the Employee’s rights under this Agreement, copies of this Agreement and any attendant or ancillary documents specifically including any documents referenced in this Agreement and copies of any documents related to the Employee’s long-term incentive awards and other compensation.

7.4 Non-Compe tition . The Employee acknowledges that the Employee (a) will perform services of a unique nature for the Company Group that are irreplaceable, and that the Employee’s performance of such services to a competing business will result in irreparable harm to the Company Group, (b) will have access to Confidential Information which, if disclosed, would unfairly and inappropriately assist in competition against the Company Group, (c) would inevitably use or disclose such Confidential Information in the course of the Employee’s employment by a competitor, (d) will have access to the customers of the Company Group, (e) will receive specialized training from the Company Group, and (f) will generate goodwill for the Company Group in the course of the Employee’s employment. Accordingly, during the Employment Term and for a period of 12 months immediately thereafter, the Employee agrees that the Employee will not, directly or indirectly, other than through the Company, engage or participate (or prepare to engage or participate), in any manner, whether directly or indirectly through an employee, employer, consultant, agent, principal, partner, more than 1% shareholder, officer, director, licensor, lender, lessor or in any other individual or representative capacity, in any business or activity which is in competition with the business of the Company Group in the leasing, acquiring, exploring or producing hydrocarbons and related products within the boundaries of, or within a ten-mile radius of the boundaries of, any mineral property interest of any member of the Company Group (including, without limitation, a mineral lease, overriding royalty interest, production payment, net profits interest, mineral fee interest or option or right to acquire any of the foregoing, or an area of mutual interest as designated pursuant to contractual agreements between any member of the Company Group and any third party), or any other property on which any of the Company Group has an option, right, license or authority to conduct or direct exploratory activities, such as three-dimensional seismic acquisition or other seismic, geophysical and geochemical activities (but not including any preliminary geological mapping), provided that the foregoing will not restrict the Employee from obtaining post-termination employment with an entity that only has de minimis operations in the restricted territory (as determined by the Board in good faith); provided that, this Section  7.4 will not preclude the Employee from making passive investments in securities of oil and gas companies which are registered on a national stock exchange, if (i) the aggregate amount owned by the Employee and her spouse and children, if any, does not exceed 1% of such company’s outstanding securities, and (ii) the aggregate amount invested in such investments by the Employee and her spouse and children does not exceed $1,000,000.

7.5 Non-Solicitatio n; Non-Interference .

(a) During the Employment Term and for a period of 12 months immediately thereafter, the Employee agrees that she shall not, except in the furtherance of the Employee’s duties hereunder, directly or indirectly, individually or on behalf of any other person, firm, corporation or other entity, induce or attempt to induce any customer, supplier, agent, intermediary or other business relation of the Company Group to reduce or cease doing business with the

 

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Company Group, or interfere with the relationship between any such customer, supplier, agent, intermediary or business relation and the Company Group (including making any negative statements or communications concerning the Company Group); provided that nothing contained in this Section  7.5(a) will prohibit public advertising or general solicitations that are not specifically directed to customers, suppliers, licensees or other business relations of the Company Group.

(b) During the Employment Term and for a period of 12 months immediately thereafter, the Employee agrees that she shall not, except in the furtherance of the Employee’s duties hereunder, directly or indirectly, individually or on behalf of any other person, firm, corporation or other entity, solicit, aid or induce any employee, representative or agent of the Company Group to leave such employment or retention or to accept employment with or render services to or with any other person, firm, corporation or other entity unaffiliated with the Company Group or hire or retain any such employee, representative or agent, or take any action to materially assist or aid any other person, firm, corporation or other entity in identifying, hiring or soliciting any such employee, representative or agent. An employee, representative or agent shall be deemed covered by this Section  7.5(b) while so employed or retained and for a period of six months thereafter.

7.6 Non-Disparagement . The Employee agrees not to make any negative, disparaging, detrimental or derogatory remarks or public statements (written, oral, telephonic, electronic, or by any other method) about the Company or any other member of the Company Group or their respective successors and assigns or any of their respective officers, directors, employees, shareholders, agents or products. The Company agrees not to make any negative, disparaging, detrimental or derogatory remarks or public statements (written, oral, telephonic, electronic or by any other method) about the Employee. The foregoing shall not be violated by truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings).

7.7 Assignment of Developments .

(a) The Employee acknowledges and agrees that all ideas, methods, inventions, discoveries, improvements, work products, developments, software, know-how, processes, techniques, works of authorship and other work product, whether patentable or unpatentable, (i) that are reduced to practice, created, invented, designed, developed, contributed to, or improved with the use of any Company Group resources and/or within the scope of the Employee’s work with the Company Group or that relate to the business, operations or actual or demonstrably anticipated research or development of the Company Group, and that are made or conceived by the Employee, solely or jointly with others, during the Employment Term, or (ii) suggested by any work that the Employee performs in connection with the Company Group, either while performing the Employee’s duties with the Company Group or on the Employee’s own time, but only insofar as the Inventions are related to the Employee’s work as an employee or other service provider to the Company Group, shall belong exclusively to the Company (or its designee), whether or not patent or other applications for intellectual property protection are filed thereon (the “ Inventions ”). The Employee will keep full and complete written records (the “ Records ”), in the manner prescribed by the Company, of all Inventions, and will promptly disclose all Inventions completely

 

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and in writing to the Company. The Records shall be the sole and exclusive property of the Company, and the Employee will surrender them upon the termination of the Employment Term, or upon the Company’s earlier request. The Employee irrevocably conveys, transfers and assigns to the Company the Inventions and all patents or other intellectual property rights that may issue thereon in any and all countries, whether during or subsequent to the Employment Term, together with the right to file, in the Employee’s name or in the name of the Company (or its designee), applications for patents and equivalent rights (the “ Applications ”). The Employee will, at any time during and subsequent to the Employment Term, make such applications, sign such papers, take all rightful oaths, and perform all other acts as may be requested from time to time by the Company to perfect, record, enforce, protect, patent or register the Company’s rights in the Inventions, all without additional compensation to the Employee from the Company. The Employee will also execute assignments to the Company (or its designee) of the Applications, and give the Company and its attorneys all reasonable assistance (including the giving of testimony) to obtain the Inventions for the Company’s benefit, all without additional compensation to the Employee from the Company, but entirely at the Company’s expense.

(b) In addition, the Inventions will be deemed Work for Hire, as such term is defined under the copyright laws of the United States, on behalf of the Company, and the Employee agrees that the Company will be the sole owner of the Inventions, and all underlying rights therein, in all media now known or hereinafter devised, throughout the universe and in perpetuity without any further obligations to the Employee. If the Inventions, or any portion thereof, are deemed not to be Work for Hire, or the rights in such Inventions do not otherwise automatically vest in the Company, the Employee hereby irrevocably conveys, transfers and assigns to the Company, all rights, in all media now known or hereinafter devised, throughout the universe and in perpetuity, in and to the Inventions, including, without limitation, all of the Employee’s right, title and interest in the copyrights (and all renewals, revivals and extensions thereof) to the Inventions, including, without limitation, all rights of any kind or any nature now or hereafter recognized, including, without limitation, the unrestricted right to make modifications, adaptations and revisions to the Inventions, to exploit and allow others to exploit the Inventions and all rights to sue at law or in equity for any infringement, or other unauthorized use or conduct in derogation of the Inventions, known or unknown, prior to the date hereof, including, without limitation, the right to receive all proceeds and damages therefrom. In addition, the Employee hereby waives any so-called “moral rights” with respect to the Inventions. To the extent that the Employee has any rights in the results and proceeds of the Employee’s service to the Company that cannot be assigned in the manner described herein, the Employee agrees to unconditionally waive the enforcement of such rights. The Employee hereby waives any and all currently existing and future monetary rights in and to the Inventions and all patents and other registrations for intellectual property that may issue thereon, including, without limitation, any rights that would otherwise accrue to the Employee’s benefit by virtue of the Employee being an employee of or other service provider to the Company.

7.9 Injunctive Relief . The Employee acknowledges that a breach of any of the covenants contained in this Section 7 may result in material, irreparable injury to the Company Group for which there is no adequate remedy at law, that it will not be possible to measure damages for such injuries precisely, and that, in the event of such a breach or threat of breach, the Company or any other member of the Company Group will be entitled to obtain a temporary restraining order and/or a preliminary or permanent injunction restraining the Employee from engaging in activities prohibited by this Section 7 or such other relief as may be required to specifically enforce any of the covenants in this Section 7 .

 

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7.10 Adjustment of Covenants . The Parties consider the covenants and restrictions contained in this Section 7 to be reasonable. However, if and when any such covenant or restriction is found to be void or unenforceable and would have been valid had some part of it been deleted or had its scope of application been modified, such covenant or restriction will be deemed to have been applied with such modification as would be necessary and consistent with the intent of the Parties to have made it valid, enforceable and effective.

7.11 Forfeiture Provision .

(a) Detrimental Activities. If the Employee engages in any activity that violates any covenant or restriction contained in this Section  7 , in addition to any other remedy the Company may have at law or in equity, (i) the Employee will be entitled to no further payments or benefits from the Company under this Agreement or otherwise, except for any payments or benefits required to be made or provided under applicable law; (ii) all forms of equity compensation held by or credited to the Employee will terminate effective as of the date on which the Employee engages in that activity, unless terminated sooner by operation of another term or condition of this Agreement or other applicable plans and agreements; and (iii) any exercise, payment or delivery pursuant to any equity compensation award that occurred within one year prior to the date on which the Employee engages in that activity may be rescinded within one year after the first date that any member of the Board first became aware that the Employee engaged in that activity. In the event of any such rescission, the Employee will pay to the Company the amount of any gain realized or payment received as a result of the rescinded exercise, payment or delivery (after deducting the Employee’s actual income tax liability incurred with respect to such gain or payment), in such manner and on such terms and condition as may be required. Notwithstanding any provision of this Agreement to the contrary, if the Employee disputes whether she has violated any covenant or restriction contained in Section  7 , and such dispute has been adjudicated to a final decision pursuant to Section  8.5 in the Employee’s favor, the Company will pay to the Employee all amounts withheld or clawed back pursuant to this Section  7.11 to the extent ordered by a court of competent jurisdiction; provided that legal action in this respect is filed by the Employee within 60 days after being notified of the Company’s decision affecting the Employee under this Section  7.11 .

(b) Right of Setoff. The Employee consents to a deduction from any amounts the Company owes the Employee from time to time (including amounts owed as wages or other compensation, fringe benefits, or vacation pay, as well as any other amounts owed to the Employee by the Company), to the extent of the amounts the Employee owes the Company under Section  7.11(a) (above). Whether or not the Company elects to make any setoff in whole or in part, if the Company does not recover by means of setoff the full amount the Employee owes, calculated as set forth above, the Employee agrees to pay immediately the unpaid balance to the Company.

 

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8.	Miscellaneous.

8.1 Assignment; Successors; Binding Agreement . This Agreement may not be assigned by either Party, whether by operation of law or otherwise, without the prior written consent of the other Party, except that any right, title or interest of the Company arising out of this Agreement may be assigned to any corporation or entity controlling, controlled by, or under common control with the Company, or succeeding to the business and substantially all of the assets of the Company or any affiliates for which the Employee performs substantial services. Subject to the foregoing, this Agreement will be binding upon and will inure to the benefit of the Parties and their respective heirs, legatees, devisees, personal representatives, successors and assigns. The Company shall obtain from any successor or other person or entity acquiring a majority of the Company’s assets or equity securities a written agreement to perform all terms of this Agreement, and any failure by the Company to obtain such written agreement shall be a material breach of this Agreement.

8.2 Modification and Waiver . Except as otherwise provided below, no provision of this Agreement may be modified, waived, or discharged unless such waiver, modification or discharge is duly approved by the Board and is agreed to in writing by the Employee and such officer(s) as may be specifically authorized by the Board to effect it. No waiver by any Party of any breach by any other Party of, or of compliance with, any term or condition of this Agreement to be performed by any other Party, at any time, will constitute a waiver of similar or dissimilar terms or conditions at that time or at any prior or subsequent time.

8.3 Entire Agreement . This Agreement, together with any documents specifically referenced in this Agreement, embodies the entire understanding of the Parties hereto, and, upon the Effective Date, will supersede all other oral or written agreements or understandings between them regarding the subject matter hereof; provided, however, that if there is a conflict between any of the terms in this Agreement and the terms in any award agreement between the Company and the Employee pursuant to any long-term incentive plan or otherwise, the terms of the award agreement shall govern. No agreement or representation, oral or otherwise, express or implied, with respect to the subject matter of this Agreement, has been made by either Party which is not set forth expressly in this Agreement or the other documents referenced in this Section  8.3 .

8.4 Governing Law . The validity, interpretation, construction and performance of this Agreement will be governed by the laws of the State of Texas other than the conflict of laws provision thereof.

8.5 Consent to Jurisdiction; Service of Process ; Waiver of Right to Jury Trial .

(a) Disputes . In the event of any dispute, controversy or claim between the Company and the Employee arising out of or relating to the interpretation, application or enforcement of the provisions of this Agreement, the Company and the Employee agree and consent to the personal jurisdiction of the state and local courts of Harris County, Texas and/or the United States District Court for the Southern District of Texas, Houston Division for resolution of the dispute, controversy or claim, and that those courts, and only those courts, shall have any jurisdiction to determine any dispute, controversy or claim related to, arising under or in connection with this Agreement. The Company and the Employee also agree that those courts are convenient forums for the parties to any such dispute, controversy or claim and for any potential witnesses and that process issued out of any such court or in accordance with the rules of practice of that court may be served by mail or other forms of substituted service to the Company at the address of its principal executive offices and to the Employee at the Employee’s last known address as reflected in the Company’s records.

 

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(b) Waiver of Right to Jury Trial . THE COMPANY AND THE EMPLOYEE HEREBY VOLUNTARILY, KNOWINGLY AND INTENTIONALLY WAIVE ANY AND ALL RIGHTS TO TRIAL BY JURY TO ALL CLAIMS ARISING OUT OF OR RELATING TO THIS AGREEMENT, AS WELL AS TO ALL CLAIMS ARISING OUT OF THE EMPLOYEE’S EMPLOYMENT WITH THE COMPANY OR TERMINATION THEREFROM.

8.6 Withholding of Taxes . The Company will withhold from any amounts payable under the Agreement all federal, state, local or other taxes as legally will be required to be withheld.

8.7 Notices . All notices, consents, waivers, and other communications under this Agreement must be in writing and will be deemed to have been duly given when (a) delivered by hand (with written confirmation of receipt), (b) sent by facsimile (with written confirmation of receipt), provided that a copy is mailed by registered mail, return receipt requested, or (c)  when received by the addressee, if sent by a nationally recognized overnight delivery service (receipt requested), in each case to the appropriate addresses and facsimile numbers set forth below (or to such other addresses and facsimile numbers as a Party may designate by notice to the other parties).

To the Company :

AMPLIFY ENERGY CORP.

Attn: General Counsel

500 Dallas Street

Suite 1600

Houston, TX 77002

Facsimile: (713) 456-2940

To the Employee :

At the address reflected in the Company’s written records.

Addresses may be changed by written notice sent to the other Party at the last recorded address of that Party.

8.8 Severability . The invalidity or unenforceability of any provision or provisions of this Agreement will not affect the validity or enforceability of any other provision of this Agreement, which will remain in full force and effect.

8.9 Counterparts . This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original but all of which together will constitute one and the same instrument.

8.10 Headings . The headings used in this Agreement are for convenience only, do not constitute a part of the Agreement, and will not be deemed to limit, characterize, or affect in any way the provisions of the Agreement, and all provisions of the Agreement will be construed as if no headings had been used in the Agreement.

 

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8.11 Construction . As used in this Agreement, unless the context otherwise requires: (a) the terms defined herein will have the meanings set forth herein for all purposes; (b)  references to “Section” are to a section hereof; (c) “include,” “includes” and “including” are deemed to be followed by “without limitation” whether or not they are in fact followed by such words or words of like import; (d) “writing,” “written” and comparable terms refer to printing, typing, lithography and other means of reproducing words in a visible form; (e) “hereof,” “herein,” “hereunder” and comparable terms refer to the entirety of this Agreement and not to any particular section or other subdivision hereof or attachment hereto; (f)  references to any gender include references to all genders; and (g)  references to any agreement or other instrument or statute or regulation are referred to as amended or supplemented from time to time (and, in the case of a statute or regulation, to any successor provision).

8.12 Capacity; No Conflicts . The Employee represents and warrants to the Company that: (a) the Employee has full power, authority and capacity to execute and deliver this Agreement, and to perform the Employee’s obligations hereunder, (b)  such execution, delivery and performance will not (and with the giving of notice or lapse of time, or both, would not) result in the breach of any agreement or other obligation to which the Employee is a party or is otherwise bound, and (c)  this Agreement is the Employee’s valid and binding obligation, enforceable in accordance with its terms.

[Signature page follows.]

 

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IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.

 

[Signature Page to Employment Agreement]

Exhibit 10.15

EMPLOYMENT AGREEMENT

This Employment Agreement (“ Agreement ”) is entered into by and between AMPLIFY ENERGY CORP. , a Delaware corporation (the “ Company ”), and DENISE DUBARD (the “ Employee ”), effective as of May 1, 2019 (the “ Effective Date ”), on the terms set forth herein. The Company and Employee may sometimes hereafter be referred to singularly as a “ Party ” or collectively as the “ Parties .”

WHEREAS , the Parties intend for the terms of this Agreement to govern the terms of the Employee’s employment with the Company and to replace and supersede any prior agreements, understandings, discussions or negotiations, whether written or oral, between the parties hereto relating to the subject matter hereof, without limitation, that certain employment agreement between the Company and the Employee, dated as of July 30, 2018 (the “ Prior Agreement ”);

Accordingly, the Parties, intending to be legally bound, agree as follows:

 

1.	Position and Duties .

1.1 Employment; Titles; Reporting . The Company agrees to employ the Employee and the Employee agrees to commence employment with the Company, upon the terms and subject to the conditions provided under this Agreement. During the Employment Term (as defined in Section 2), the Employee will serve the Company as its Vice President and Chief Accounting Officer . In such capacity, the Employee will report to the Chief Executive Officer of the Company (the “CEO”) or such position designated by the CEO and otherwise will be subject to the direction and control of the CEO or such position designated by the CEO, and the Employee will have such duties, responsibilities and authorities as may be assigned to the Employee by the CEO or such position designated by the CEO from time to time to the extent consistent with Employee’s position as Vice President and Chief Accounting Officer in a publicly traded company comparable to the Company.

1.2 Duties . During the Employment Term, the Employee will devote substantially all of the Employee’s full working time to the business and affairs of the Company, will use the Employee’s best efforts to promote the Company’s interests and will perform the Employee’s duties and responsibilities faithfully, diligently and to the best of the Employee’s ability, consistent with sound business practices. The Employee may be required by the CEO and/or the Board of Directors of the Company (the “ Board ”) to provide services to, or otherwise serve as an officer or director of, any direct or indirect subsidiary of the Company. The Employee will comply with the Company’s policies, codes and procedures, as they may be in effect from time to time, applicable to executive officers of the Company. Subject to the preceding sentence, the Employee may, with the prior written approval of the Board in each instance, engage in other business and charitable activities, provided that such charitable and/or other business activities do not violate Section 7 , create a conflict of interest or the appearance of a conflict of interest with the Company, or interfere, individually or in the aggregate, with the performance of the Employee’s obligations to the Company under this Agreement.

1.3 Place of Employment . The Employee will perform the Employee’s duties under this Agreement at the Company’s offices in Houston, Texas. The Employee understands and agrees that Employee will be required to travel from time to time for purposes of the Company’s business.

 

2.	Term of Employment .

The term of the Employee’s employment by the Company under this Agreement (the “ Employment Term ”) will commence on the Effective Date and will continue until the Employee’s employment is terminated by either Party under Section  5 . The date on which the Employee’s employment ends is referred to in this Agreement as the “ Termination Date .” For the purpose of Sections 5 and 6 of this Agreement, the Termination Date shall be the date upon which the Employee incurs a “separation from service” as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the “ Code ”), and regulations issued thereunder (collectively, “ Code Section  409A ”).

 

3.	Compensation .

3.1 Base Salary . During the Employment Term, the Employee will be entitled to receive a base salary (“ Base Salary ” ) at an annual rate of not less than $240,000 for services rendered to the Company and any of its direct or indirect subsidiaries, payable in accordance with the Company’s regular payroll practices. The Employee’s Base Salary shall be reviewed annually by the Board and may be adjusted upward in the Board’s sole discretion, but not downward.

3.2 Bonus Compensation . During the Employment Term, the Employee shall be eligible for discretionary bonus compensation with a target of 50% of the Employee’s Base Salary (the “ Target Bonus ”) for each complete calendar year that the Employee is employed by the Company hereunder (any bonus compensation payable, the “ Annual Bonus ”). The performance targets that must be achieved in order to be eligible for certain bonus levels shall be established by the Board (or a committee thereof) annually. Each Annual Bonus, if any, shall be paid as soon as administratively feasible after the Board (or a committee thereof) certifies whether the applicable performance targets for the applicable calendar year have been achieved, but in no event later than March 15 following the end of such calendar year. Notwithstanding anything in this Section  3.2 to the contrary, but subject to Section  6 below, no Annual Bonus, if any, nor any portion thereof, shall be payable for any calendar year unless the Employee remains continuously employed by the Company from the Effective Date through the date on which such Annual Bonus is paid. Any Annual Bonus will be paid in the form of (a) cash, with respect to 25% of the amount of the Annual Bonus, and (b)  fully-vested shares of the Company’s common stock having an aggregate fair market value on the grant date (as determined by the Board) equal to 75% of the amount of the Annual Bonus.

3.3 Long-Term Incentive Compensation . Long-term incentive compensation awards may be made to the Employee from time to time during the Employment Term by the Board in its sole discretion, whose decision will be based upon performance and award guidelines for executive officers of the Company established periodically by the Board in its sole discretion.

 

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4.	Expenses and Other Benefits .

4.1 Reimbursement of Business Expenses . The Employee will be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Employee during the Employment Term (in accordance with the policies and practices presently followed by the Company or as may be established by the Board from time to time for the Company’s senior executive officers) in performing services under this Agreement, provided that the Employee properly accounts for such expenses in accordance with the Company’s policies as in effect from time to time. Each reimbursement shall be paid within 30 days after it has been properly submitted to the Company by the Employee in accordance with all applicable policies, but in no event later than the end of the calendar year following the calendar year in which any such reimbursable expense was incurred.

The Company shall not be obligated to pay any such reimbursement amount for which the Employee fails to submit an invoice or other documented reimbursement request at least ten business days before the end of the calendar year next following the calendar year in which the expense was incurred. Business related expenses shall be reimbursable only to the extent they were incurred during the Employment Term, but in no event shall the time period extend beyond the later of the lifetime of the Employee or, if longer, 20 years. The amount of such reimbursements that the Company is obligated to pay in any given calendar year shall not affect the amount the Company is obligated to pay in any other calendar year. In addition, the Employee may not liquidate or exchange the right to reimbursement of such expenses for any other benefits.

4.2 Paid Time Off . The Employee shall be entitled to paid time off in accordance with the Company’s policy as then in effect (prorated for any calendar year during which the Employee is employed with the Company for less than the entire year, based on the number of days that the Employee is employed with the Company during such calendar year).

4.3 Other Employee Benefits . In addition to the foregoing, during the Employment Term, the Employee will be entitled to participate in and to receive benefits as a senior executive under all of the Company’s employee benefit plans, programs and arrangements available to senior executives, subject to the eligibility criteria and other terms and conditions thereof, as such plans, programs and arrangements may be duly amended, terminated, approved or adopted by the Company from time to time.

 

5.	Termination of Employment .

5.1 Death . The Employee’s employment under this Agreement will terminate upon the Employee’s death.

5.2 Termination by the Company .

(a) Terminable at Will. The Company may terminate the Employee’s employment under this Agreement at any time with or without Cause (as defined below).

 

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(b) Definition of Cause. For purposes of this Agreement, “ Cause ” means any of the Employee’s: (1) conviction of a felony, or plea of guilty or nolo contendere to, any felony or any crime of moral turpitude; (2) repeated intoxication by alcohol or drugs during the performance of the Employee’s duties; (3) embezzlement or other willful and intentional misuse of any of the funds of the Company or its direct or indirect subsidiaries, (4) commission of a demonstrable act of fraud; (5) willful and material misrepresentation or concealment on any written reports submitted to the Company or its direct or indirect subsidiaries; (6) material breach of this Agreement; (7) failure to follow or comply with the reasonable, material and lawful written directives of the Board; or (8) conduct constituting a material breach of the Company’s then-current code of conduct or other similar written policy which has been provided to the Employee.

(c) Notice and Cure Opportunity in Certain Circumstances. The Employee may be afforded a reasonable opportunity to cure any act or omission that would otherwise constitute Cause hereunder according to the following terms: The Board shall give the Employee written notice stating with reasonable specificity the nature of the circumstances determined by the Board in its reasonable and good faith judgment to constitute Cause. If, in the reasonable and good faith judgment of the Board, the alleged breach is reasonably susceptible to cure, the Employee will have 15 days from the Employee’s receipt of such notice to effect the cure of such circumstances or such breach to the reasonable and good faith satisfaction of the Board. The Board will state whether the Employee will have such an opportunity to cure in the initial notice of Cause referred to above. Prior to a termination for Cause, in those instances where the initial notice of Cause states that the Employee will have an opportunity to cure, the Company shall provide an opportunity for the Employee to be heard by the Board or a Board committee designated by the Board to hear the Employee. The decision as to whether the Employee has satisfactorily cured the alleged breach shall be made at such meeting. If, in the reasonable and good faith judgment of the Board, the alleged breach is not reasonably susceptible to cure, or such circumstances or breach have not been satisfactorily cured within such 15 day cure period, such breach will thereupon constitute Cause hereunder.

5.3 Termination by the Employee .

(a) Terminable at Will. The Employee may terminate the Employee’s employment under this Agreement at any time with or without Good Reason (as defined below).

(b) Notice and Cure Opportunity. If such termination is for Good Reason, the Employee will give the Company written notice, which will identify with reasonable specificity the grounds for the Employee’s resignation and provide the Company with 30 days from the day such notice is given to cure the alleged grounds for resignation contained in the notice. A termination will not be for Good Reason if such notice is given by the Employee to the Company more than 45 days after the first occurrence of the event that the Employee alleges is Good Reason for the Employee’s termination hereunder. The Employee must actually terminate Employee’s employment within 30 days following the expiration of the Company’s 30-day cure period. Otherwise, any claim of such circumstances constituting “Good Reason” shall be deemed irrevocably waived by the Employee.

 

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(c) Definition of Good Reason. For purposes of this Agreement, “ Good Reason ” will mean any of the following to which the Employee will not consent in writing: (i) a relocation of the Employee’s principal work location to a location in excess of 40 miles from its then current location; (ii) a reduction in the Employee’s then current Base Salary or Target Bonus, or both; or (iii) a material breach of any provision of this Agreement by the Company.

5.4 Notice of Termination . Any termination of the Employee’s employment by the Company or by the Employee during the Employment Term (other than termination pursuant to Section  5.1 ) will be communicated by written Notice of Termination to the other Party hereto in accordance with Section  8.7 . For purposes of this Agreement, a “ Notice of Termination ” means a written notice that (a) indicates the specific termination provision in this Agreement relied upon, (b)  to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Employee ’ s employment under the provision so indicated, and (c)  if the Termination Date is other than the date of receipt of such notice, specifies the Termination Date (which Termination Date will be not more than 30 days after the giving of such notice).

5.5 Disability . If the Company determines in good faith that the Disability (as defined herein) of the Employee has occurred during the Employment Term, it may, without breaching this Agreement, give to the Employee written notice in accordance with Section  5.4 of its intention to terminate the Employee’s employment. In such event, the Employee’s employment with the Company will terminate effective on the 30th day after receipt of such notice by the Employee, provided that, within 30 days after such receipt, the Employee has not returned to full-time performance of the Employee’s duties hereunder.

“ Disability ” means the earlier of (a) written determination by a physician selected by the Company and reasonably agreed to by the Employee that the Employee has been unable to perform substantially the Employee’s usual and customary duties under this Agreement for a period of at least 120 consecutive days or a non-consecutive period of 180 days during any 12-month period as a result of incapacity due to mental or physical illness or disease; and (b) “disability” as such term is defined in the Company’s applicable long-term disability insurance plan. At any time and from time to time, upon reasonable request therefor by the Company, the Employee will submit to reasonable medical examination for the purpose of determining the existence, nature and extent of any such disability. Any physician selected by Company shall be Board Certified in the appropriate field and shall have no actual or potential conflict of interest.

 

6.	Compensation of the Employee Upon Termination . Subject to the provisions of Section  6.9 , the Employee shall be entitled to receive the amount specified upon the termination events designated below:

6.1 Death . If the Employee’s employment under this Agreement is terminated by reason of the Employee’s death, the Company shall pay to the person or persons designated by the Employee for that purpose in a notice filed with the Company, or, if no such person has been so designated, to the Employee’s estate, the following:

(a) an amount equal to the Employee’s accrued but unpaid then current Base Salary through the Termination Date, payable in a lump sum within 30 days following the Termination Date; plus

 

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(b) if the Termination Date occurs after the end of the calendar year but prior to the date on which annual bonuses are paid, an amount equal to the Annual Bonus that the Employee would have received (if any) had Employee been employed on the payment date (the “ Actual Full Year Bonus Amount ”), payable at the same time annual bonuses for such year are paid to actively-employed senior executives of the Company; plus

(c) a pro-rata portion of the Employee’s Annual Bonus for the calendar year in which the Employee’s Termination Date occurs, based on actual results for such year (determined by multiplying the amount of such Annual Bonus which would be due for the full calendar year by a fraction, (i) the numerator of which is the number of days during the calendar year that the Employee is employed by the Company and (ii) the denominator of which is three hundred sixty-five (365)) (the “ Actual Pro Rata Bonus Amount ”), if any, payable at the same time annual bonuses for such year are paid to actively-employed senior executives of the Company; plus

(d) any other amounts that may be reimbursable by the Company to the Employee as expressly provided under this Agreement, payable in a lump sum within 30 days following the Termination Date.

The Employee’s entitlement to the amounts set forth in Section  6.1(b) and Section  6.1(c) is subject to the provisions of Section  6.5.

Thereafter, the Company will have no further obligation to the Employee under this Agreement, other than for payment of any amounts accrued and vested under any employee benefit plans or programs of the Company and any payments or benefits required to be made or provided under applicable law.

6.2 Disability . In the event of the Employee’s termination by reason of Disability pursuant to Section  5.5 , the Employee will continue to receive the Employee’s Base Salary in effect immediately prior to the Termination Date and participate in applicable employee benefit plans or programs of the Company through the Termination Date, subject to offset dollar-for-dollar by the amount of any disability income payments provided to the Employee under any Company disability policy or program that is maintained by the Company. The Company also shall pay to the Employee the amounts set forth in Section  6.1(a) through Section  6.1(d) , at the times and subject to the conditions set forth in Section  6.1 . Thereafter, the Company will have no further obligation to the Employee under this Agreement, other than for payment of any amounts accrued and vested under any employee benefit plans or programs of the Company and any payments or benefits required to be made or provided under applicable law.

6.3 By the Company for Cause or by the Employee Without Good Reason .

(a) Termination by Company For Cause. If the Employee’s employment is terminated by the Company for Cause, the Employee will receive (i) the Employee’s accrued but unpaid then current Base Salary through the Termination Date and (ii) any other amounts that may be reimbursable by the Company to the Employee as expressly provided under this Agreement, in each case, payable in a lump sum within 30 days following the Termination Date. Thereafter, the Company will have no further obligation to the Employee under this Agreement, other than for payment of any amounts accrued and vested under any employee benefit plans or programs of the Company, and any payments or benefits required to be made or provided under applicable law. No bonus will be paid to the Employee for a termination of the Employee’s employment for Cause.

 

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(b) Termination by Employee Without Good Reason . If the Employee’s employment is terminated by the Employee without Good Reason, the Employee will receive (i) the Employee’s accrued but unpaid then current Base Salary through the Termination Date and (ii) any other amounts that may be reimbursable by the Company to the Employee as expressly provided under this Agreement, in each case, payable in a lump sum within 30 days following the Termination Date. Thereafter, the Company will have no further obligation to the Employee under this Agreement, other than for payment of any amounts accrued and vested under any employee benefit plans or programs of the Company, and any payments or benefits required to be made or provided under applicable law. No bonus will be paid to the Employee for a termination of the Employee’s employment without Good Reason.

6.4 By the Employee for Good Reason or by the Company Without Cause . Subject to the provisions of Section  6.5 , if the Company terminates the Employee’s employment without Cause, or the Employee terminates Employee’s employment for Good Reason, then the Employee will be entitled to the following (with the amounts payable under clauses (b), (c), (e) and (f)  below, collectively, the “ Severance Benefits ”):

(a) an amount equal to the Employee’s accrued but unpaid then current Base Salary through the Termination Date, payable in a lump sum within 30 days following the Termination Date; plus

(b) if the Termination Date occurs after the end of the calendar year but prior to the date on which annual bonuses are paid, the Actual Full Year Bonus Amount, payable at the same time annual bonuses for such year are paid to actively-employed senior executives of the Company; plus

(c) the Actual Pro Rata Bonus Amount, if any, payable at the same time annual bonuses for such year are paid to actively-employed senior executives of the Company; plus

(d) any other amounts that may be reimbursable by the Company to the Employee as expressly provided under this Agreement; plus

(e) (i) if the Employee’s termination occurs on or prior to December 11, 2019, an amount equal to six (6) months of the Employee’s monthly Base Salary rate as in effect on the day before the Termination Date (but not as an employee), and (ii) if the Employee’s termination occurs after December 11, 2019, an amount equal to twelve (12) months of the Employee’s monthly Base Salary rate as in effect on the day before the Termination Date (but not as an employee), in each case, payable in accordance with the Company’s regularly scheduled payroll practices for a period of either six (6) or twelve (12) months following the Termination Date; provided that to the extent the payment of any amount constitutes “nonqualified deferred compensation” for purposes of Code Section 409A, any such payment scheduled to occur during the first 60 days following the Termination Date shall not be paid until the first regularly scheduled pay period following the 60 ^th day after the Termination Date and shall include payment of any amount that was otherwise scheduled to be paid prior thereto; plus

 

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(f) subject to the Employee’s (i) timely election of continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“ COBRA ”), and (B) continued copayment of premiums at the same level and cost to the Employee as if the Employee were a senior executive of the Company (excluding, for purposes of calculating cost, an employee’s ability to pay premiums with pre-tax dollars), continued participation in the Company’s group health plan (to the extent permitted under applicable law and the terms of such plan) which covers the Employee (and Employee’s spouse and eligible dependents, if applicable) for a period of 12 months, provided that the Employee is eligible and remains eligible for COBRA coverage; provided, further, that the Company may modify the continuation coverage contemplated by this Section  6.4(f) to the extent reasonably necessary to avoid the imposition of any excise taxes on the Company for failure to comply with the nondiscrimination requirements of the Patient Protection and Affordable Care Act of 2010, as amended, and/or the Health Care and Education Reconciliation Act of 2010, as amended (to the extent applicable); and provided, further, that in the event that the Employee obtains other employment that offers group health plan coverage, such continuation of coverage by the Company under this Section  6.4(f) shall cease as of the end of the month in which the Employee obtains such other employer-provided, group health plan coverage.

6.5 Conditions to Receipt of Certain Post-Termination Payments and Benefits.

(a) Release . As a condition to receiving the Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section  6.1 , Section  6.2 or Section  6.4 , the Employee must execute and not revoke a general release of claims, which will include an affirmation of the restrictive covenants set forth in Section  7 , in form and substance satisfactory to the Company (the “ Release ”). The Company will provide the Release to the Employee for signature within ten days after the Termination Date. If the Company has provided the Release to the Employee for signature within ten days after the Termination Date, and if the Release is not executed and non-revocable within 60 days after the Termination Date and prior to the date on which such payment and/or benefits are to be first paid or provided to the Employee, the Employee will not be entitled to the Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits, as the case may be, and the Company will have no further obligations with respect to the provision of those payments and/or benefits except as may be required by law. If the Release consideration period spans two calendar years, no payments and/or benefits subject to the Release will be paid or provided until the later of (i) the date on which the Release becomes effective and non-revocable and (ii) January 2 ^nd of the second calendar year.

(b) Limitation on Benefits. If, following a termination of employment that gives the Employee a right to the payment of the Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section  6.1 , Section  6.2 or Section  6.4 , the Employee violates any of the covenants in Section  7 or as otherwise set forth in the Release, the Employee will have no further right or claim to the Actual Full Year Bonus Amount, the Target Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section  6.1 , Section  6.2 or Section  6.4 from and after the date on which the Employee engages in such activities, and the Company will have no further obligations with respect to such payments or benefits, and the covenants in Section  7 will nevertheless continue in full force and effect.

 

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6.6 Certain Amounts Not Includable for Employee Benefits Purposes . Except to the extent the terms of any applicable benefit plan, policy or program provide otherwise, any benefit programs of the Company that take into account the Employee’s income will exclude the Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section 6.1 , Section 6.2 or Section 6.4 .

6.7 Exclusive Severance Benefits . The Actual Full Year Bonus Amount, the Actual Pro Rata Bonus Amount and/or any Severance Benefits to which the Employee may otherwise be entitled under Section 6.1 , Section 6.2 or Section 6.4 , if they become payable under the terms of this Agreement, will be in lieu of any other severance or similar benefits that would otherwise be payable under any other agreement, plan, program or policy of the Company, excluding, for this purpose, any post-termination treatment of equity incentive awards provided under the terms of the governing award agreements.

6.8 Code Section 280G; Code Section 409A . Notwithstanding anything in this Agreement to the contrary:

(a) If any of the payments or benefits received or to be received by the Employee (including, without limitation, any payment or benefits received in connection with a “change of control” or the Employee’s termination of employment, whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement, or otherwise) (all such payments collectively referred to herein as the (“ 280G Payments ”) constitute “parachute payments” within the meaning of Section 280G of the Code and would, but for this Section  6.8(a) , be subject to the excise tax imposed under Section 4999 of the Code (the “ Excise Tax ”), then prior to making the 280G Payments, a calculation shall be made comparing (i) the Net Benefit (as defined below) to the Employee of the 280G Payments after payment of the Excise Tax to (ii) the Net Benefit to the Employee if the 280G Payments are limited to the extent necessary to avoid being subject to the Excise Tax. Only if the amount calculated under clause (i) above is less than the amount under clause (ii) above will the 280G Payments be reduced to the minimum extent necessary to ensure that no portion of the 280G Payments is subject to the Excise Tax. “ Net Benefit ” shall mean the present value of the 280G Payments net of all federal, state, local, foreign income, employment and excise taxes. Any reduction made pursuant to this Section  6.8(a) shall be made in a manner determined by the Company that is consistent with the requirements of Code Section 409A and that maximizes the Employee’s economic position and after-tax income; for the avoidance of doubt, the Employee shall not have any discretion in determining the manner in which the payments and benefits are reduced.

(b) In the event that any benefits payable or otherwise provided under this Agreement would be deemed to constitute non-qualified deferred compensation subject to Code Section 409A, the Company will have the discretion to adjust the terms of such payment or benefit (but not the amount or value thereof) to the minimum extent reasonably necessary to comply with the requirements of Code Section 409A to avoid the imposition of any excise tax or other penalty with respect to such payment or benefit under Code Section 409A.

 

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6.9 Timing of Payments by the Company . Notwithstanding anything in this Agreement to the contrary, in the event that the Employee is a “specified employee” (as determined under Code Section 409A) at the time of the separation from service triggering the payment or provision of benefits, any payment or benefit under this Agreement which is determined to provide for a deferral of compensation pursuant to Code Section 409A shall not commence being paid or made available to the Employee until after six months from the Termination Date that constitutes a “separation from service” within the meaning of Code Section  409A or such earlier date as may be permitted under Code Section  409A.

 

7.	Restrictive Covenants.

7.1 Confidential Information . During the Employment Term and thereafter, the Employee shall keep secret and retain in strictest confidence, and shall not use for the benefit of himself or others, any confidential matters or trade secrets of, or confidential and competitively valuable information concerning, the Company and its direct or indirect subsidiaries (collectively, the “ Company Group ”), including, without limitation, information concerning their organization and operations, business and affairs, formulae, manufacturing processes, proprietary information, technical data, “know-how”, customer lists, details of client or consultant contracts, vendor and purchasing arrangements, terms and discounts, pricing methods and policies, financial information, operational methods, marketing plans or strategies, business acquisition plans, new personnel acquisition plans, technical processes, projects, financing/financial projections, budget information and procedures, marketing plans or strategies, and research products. The confidentiality obligations set forth in this Section  7.1 shall not apply to any information that becomes part of the public domain other than through the Employee’s disclosure in violation of the terms hereof. Nothing herein shall be construed as prohibiting the Employee from using or disclosing such confidential information as is necessary and has been authorized in Employee’s proper performance of services for the Company Group.

(a) SEC Provisions . The Employee understands that nothing contained in this Agreement limits the Employee’s ability to file a charge or complaint with the Securities and Exchange Commission (“ SEC ”). The Employee further understands that this Agreement does not limit the Employee’s ability to communicate with the SEC or otherwise participate in any investigation or proceeding that may be conducted by the SEC, including providing documents or other information, without notice to the Company. This Agreement does not limit the Employee’s right to receive an award for information provided to the SEC. This Section  7.1(a) applies only for the period of time that the Company is subject to the Dodd-Frank Act.

(b) Trade Secrets . The parties specifically acknowledge that 18 U.S.C. § 1833(b) provides: “An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that—(A) is made—(i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.” Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b). Accordingly, notwithstanding anything to the contrary in the foregoing, the Parties have the right to disclose in confidence trade secrets to federal, state, and local government officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law. If the Employee files a lawsuit for retaliation against the Company for reporting a suspected violation of law, the Employee may disclose the Company’s trade secrets to the Employee’s attorney and use the trade secret information in the court proceeding, if the Employee first files any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order.

 

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7.2 No Interference . Notwithstanding any other provision of this Agreement, (a)  the Employee may disclose confidential information (as described in Section 7.1 above) when required to do so by a court of competent jurisdiction, by any governmental agency having authority over the Employee or the business of the Company or by any administrative body or legislative body (including a committee thereof) with jurisdiction to order the Employee to divulge, disclose or make accessible such information, in each case, subject to the Employee’s obligations to notify the Company and first obtain a protective order, to the extent permitted by applicable law; and (b)  nothing in this Agreement is intended to interfere with the Employee’s right to (i)  report possible violations of state or federal law or regulation to any governmental or law enforcement agency or entity; (ii)  make other disclosures that are protected under the whistleblower provisions of state or federal law or regulation (including the right to receive an award for information provided to any such government agencies); (iii) file a claim or charge any governmental agency or entity; or (iv)  testify, assist or participate in an investigation, hearing, or proceeding conducted by any governmental or law enforcement agency or entity, or any court. For purposes of clarity, in making or initiating any such reports or disclosures or engaging in any of the conduct outlined in subsection (b)  above, the Employee may disclose confidential information to the extent necessary to such governmental or law enforcement agency or entity or such court, need not seek prior authorization from the Company and is not required to notify the Company of any such reports, disclosures or conduct.

7.3 Return of Property . The Employee agrees to deliver promptly to the Company, upon termination of the Employee’s employment hereunder, or at any other time when the Company so requests, all documents relating to the business of the Company Group; provided, however, that the Employee will be permitted to retain copies of any documents or materials of a personal nature or otherwise related to the Employee’s rights under this Agreement, copies of this Agreement and any attendant or ancillary documents specifically including any documents referenced in this Agreement and copies of any documents related to the Employee’s long-term incentive awards and other compensation.

7.4 Non-Compe tition . The Employee acknowledges that the Employee (a) will perform services of a unique nature for the Company Group that are irreplaceable, and that the Employee’s performance of such services to a competing business will result in irreparable harm to the Company Group, (b) will have access to Confidential Information which, if disclosed, would unfairly and inappropriately assist in competition against the Company Group, (c) would inevitably use or disclose such Confidential Information in the course of the Employee’s employment by a competitor, (d) will have access to the customers of the Company Group, (e) will receive specialized training from the Company Group, and (f) will generate goodwill for the Company Group in the course of the Employee’s employment. Accordingly, during the Employment Term and for a period of 6 months immediately thereafter, the Employee agrees that the Employee will not, directly or indirectly, other than through the Company, engage or participate (or prepare to engage or participate), in any manner, whether directly or indirectly through an employee, employer, consultant, agent, principal, partner, more than 1% shareholder, officer, director, licensor, lender, lessor or in any other individual or representative capacity, in any business or activity which is in competition with the business of the Company Group in the

 

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leasing, acquiring, exploring or producing hydrocarbons and related products within the boundaries of, or within a ten-mile radius of the boundaries of, any mineral property interest of any member of the Company Group (including, without limitation, a mineral lease, overriding royalty interest, production payment, net profits interest, mineral fee interest or option or right to acquire any of the foregoing, or an area of mutual interest as designated pursuant to contractual agreements between any member of the Company Group and any third party), or any other property on which any of the Company Group has an option, right, license or authority to conduct or direct exploratory activities, such as three-dimensional seismic acquisition or other seismic, geophysical and geochemical activities (but not including any preliminary geological mapping), provided that the foregoing will not restrict the Employee from obtaining post-termination employment with an entity that only has de minimis operations in the restricted territory (as determined by the Board in good faith); provided that, this Section  7.4 will not preclude the Employee from making passive investments in securities of oil and gas companies which are registered on a national stock exchange, if (i) the aggregate amount owned by the Employee and Employee’s spouse and children, if any, does not exceed 1% of such company’s outstanding securities, and (ii) the aggregate amount invested in such investments by the Employee and Employee’s spouse and children does not exceed $1,000,000.

7.5 Non-Solicitatio n; Non-Interference .

(a) During the Employment Term and for a period of 6  months immediately thereafter, the Employee agrees that Employee shall not, except in the furtherance of the Employee’s duties hereunder, directly or indirectly, individually or on behalf of any other person, firm, corporation or other entity, induce or attempt to induce any customer, supplier, agent, intermediary or other business relation of the Company Group to reduce or cease doing business with the Company Group, or interfere with the relationship between any such customer, supplier, agent, intermediary or business relation and the Company Group (including making any negative statements or communications concerning the Company Group); provided that nothing contained in this Section  7.5(a) will prohibit public advertising or general solicitations that are not specifically directed to customers, suppliers, licensees or other business relations of the Company Group.

(b) During the Employment Term and for a period of 6  months immediately thereafter, the Employee agrees that Employee shall not, except in the furtherance of the Employee’s duties hereunder, directly or indirectly, individually or on behalf of any other person, firm, corporation or other entity, solicit, aid or induce any employee, representative or agent of the Company Group to leave such employment or retention or to accept employment with or render services to or with any other person, firm, corporation or other entity unaffiliated with the Company Group or hire or retain any such employee, representative or agent, or take any action to materially assist or aid any other person, firm, corporation or other entity in identifying, hiring or soliciting any such employee, representative or agent. An employee, representative or agent shall be deemed covered by this Section  7.5(b) while so employed or retained and for a period of six months thereafter.

 

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7.6 Non-Disparagement . The Employee agrees not to make any negative, disparaging, detrimental or derogatory remarks or public statements (written, oral, telephonic, electronic, or by any other method) about the Company or any other member of the Company Group or their respective successors and assigns or any of their respective officers, directors, employees, shareholders, agents or products. The Company agrees not to make any negative, disparaging, detrimental or derogatory remarks or public statements (written, oral, telephonic, electronic or by any other method) about the Employee. The foregoing shall not be violated by truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings).

7.7 Assignment of Developments .

(a) The Employee acknowledges and agrees that all ideas, methods, inventions, discoveries, improvements, work products, developments, software, know-how, processes, techniques, works of authorship and other work product, whether patentable or unpatentable, (i) that are reduced to practice, created, invented, designed, developed, contributed to, or improved with the use of any Company Group resources and/or within the scope of the Employee’s work with the Company Group or that relate to the business, operations or actual or demonstrably anticipated research or development of the Company Group, and that are made or conceived by the Employee, solely or jointly with others, during the Employment Term, or (ii) suggested by any work that the Employee performs in connection with the Company Group, either while performing the Employee’s duties with the Company Group or on the Employee’s own time, but only insofar as the Inventions are related to the Employee’s work as an employee or other service provider to the Company Group, shall belong exclusively to the Company (or its designee), whether or not patent or other applications for intellectual property protection are filed thereon (the “ Inventions ”). The Employee will keep full and complete written records (the “ Records ”), in the manner prescribed by the Company, of all Inventions, and will promptly disclose all Inventions completely and in writing to the Company. The Records shall be the sole and exclusive property of the Company, and the Employee will surrender them upon the termination of the Employment Term, or upon the Company’s earlier request. The Employee irrevocably conveys, transfers and assigns to the Company the Inventions and all patents or other intellectual property rights that may issue thereon in any and all countries, whether during or subsequent to the Employment Term, together with the right to file, in the Employee’s name or in the name of the Company (or its designee), applications for patents and equivalent rights (the “ Applications ”). The Employee will, at any time during and subsequent to the Employment Term, make such applications, sign such papers, take all rightful oaths, and perform all other acts as may be requested from time to time by the Company to perfect, record, enforce, protect, patent or register the Company’s rights in the Inventions, all without additional compensation to the Employee from the Company. The Employee will also execute assignments to the Company (or its designee) of the Applications, and give the Company and its attorneys all reasonable assistance (including the giving of testimony) to obtain the Inventions for the Company’s benefit, all without additional compensation to the Employee from the Company, but entirely at the Company’s expense.

(b) In addition, the Inventions will be deemed Work for Hire, as such term is defined under the copyright laws of the United States, on behalf of the Company, and the Employee agrees that the Company will be the sole owner of the Inventions, and all underlying rights therein, in all media now known or hereinafter devised, throughout the universe and in perpetuity without any further obligations to the Employee. If the Inventions, or any portion thereof, are deemed not to be Work for Hire, or the rights in such Inventions do not otherwise automatically vest in the

 

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Company, the Employee hereby irrevocably conveys, transfers and assigns to the Company, all rights, in all media now known or hereinafter devised, throughout the universe and in perpetuity, in and to the Inventions, including, without limitation, all of the Employee’s right, title and interest in the copyrights (and all renewals, revivals and extensions thereof) to the Inventions, including, without limitation, all rights of any kind or any nature now or hereafter recognized, including, without limitation, the unrestricted right to make modifications, adaptations and revisions to the Inventions, to exploit and allow others to exploit the Inventions and all rights to sue at law or in equity for any infringement, or other unauthorized use or conduct in derogation of the Inventions, known or unknown, prior to the date hereof, including, without limitation, the right to receive all proceeds and damages therefrom. In addition, the Employee hereby waives any so-called “moral rights” with respect to the Inventions. To the extent that the Employee has any rights in the results and proceeds of the Employee’s service to the Company that cannot be assigned in the manner described herein, the Employee agrees to unconditionally waive the enforcement of such rights. The Employee hereby waives any and all currently existing and future monetary rights in and to the Inventions and all patents and other registrations for intellectual property that may issue thereon, including, without limitation, any rights that would otherwise accrue to the Employee’s benefit by virtue of the Employee being an employee of or other service provider to the Company.

7.9 Injunctive Relief . The Employee acknowledges that a breach of any of the covenants contained in this Section 7 may result in material, irreparable injury to the Company Group for which there is no adequate remedy at law, that it will not be possible to measure damages for such injuries precisely, and that, in the event of such a breach or threat of breach, the Company or any other member of the Company Group will be entitled to obtain a temporary restraining order and/or a preliminary or permanent injunction restraining the Employee from engaging in activities prohibited by this Section 7 or such other relief as may be required to specifically enforce any of the covenants in this Section 7 .

7.10 Adjustment of Covenants . The Parties consider the covenants and restrictions contained in this Section 7 to be reasonable. However, if and when any such covenant or restriction is found to be void or unenforceable and would have been valid had some part of it been deleted or had its scope of application been modified, such covenant or restriction will be deemed to have been applied with such modification as would be necessary and consistent with the intent of the Parties to have made it valid, enforceable and effective.

7.11 Forfeiture Provision .

(a) Detrimental Activities. If the Employee engages in any activity that violates any covenant or restriction contained in this Section  7 , in addition to any other remedy the Company may have at law or in equity, (i) the Employee will be entitled to no further payments or benefits from the Company under this Agreement or otherwise, except for any payments or benefits required to be made or provided under applicable law; (ii) all forms of equity compensation held by or credited to the Employee will terminate effective as of the date on which the Employee engages in that activity, unless terminated sooner by operation of another term or condition of this Agreement or other applicable plans and agreements; and (iii) any exercise, payment or delivery pursuant to any equity compensation award that occurred within one year prior to the date on which the Employee engages in that activity may be rescinded within one year after the first date that any member of the Board first became aware that the Employee engaged in

 

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that activity. In the event of any such rescission, the Employee will pay to the Company the amount of any gain realized or payment received as a result of the rescinded exercise, payment or delivery (after deducting the Employee’s actual income tax liability incurred with respect to such gain or payment), in such manner and on such terms and condition as may be required. Notwithstanding any provision of this Agreement to the contrary, if the Employee disputes whether Employee has violated any covenant or restriction contained in Section  7 , and such dispute has been adjudicated to a final decision pursuant to Section  8.5 in the Employee’s favor, the Company will pay to the Employee all amounts withheld or clawed back pursuant to this Section  7.11 to the extent ordered by a court of competent jurisdiction; provided that legal action in this respect is filed by the Employee within 60 days after being notified of the Company’s decision affecting the Employee under this Section  7.11 .

(b) Right of Setoff. The Employee consents to a deduction from any amounts the Company owes the Employee from time to time (including amounts owed as wages or other compensation, fringe benefits, or vacation pay, as well as any other amounts owed to the Employee by the Company), to the extent of the amounts the Employee owes the Company under Section  7.11(a) (above). Whether or not the Company elects to make any setoff in whole or in part, if the Company does not recover by means of setoff the full amount the Employee owes, calculated as set forth above, the Employee agrees to pay immediately the unpaid balance to the Company.

 

8.	Miscellaneous .

8.1 Assignment; Successors; Binding Agreement . This Agreement may not be assigned by either Party, whether by operation of law or otherwise, without the prior written consent of the other Party, except that any right, title or interest of the Company arising out of this Agreement may be assigned to any corporation or entity controlling, controlled by, or under common control with the Company, or succeeding to the business and substantially all of the assets of the Company or any affiliates for which the Employee performs substantial services. Subject to the foregoing, this Agreement will be binding upon and will inure to the benefit of the Parties and their respective heirs, legatees, devisees, personal representatives, successors and assigns. The Company shall obtain from any successor or other person or entity acquiring a majority of the Company’s assets or equity securities a written agreement to perform all terms of this Agreement, and any failure by the Company to obtain such written agreement shall be a material breach of this Agreement.

8.2 Modification and Waiver . Except as otherwise provided below, no provision of this Agreement may be modified, waived, or discharged unless such waiver, modification or discharge is duly approved by the Board and is agreed to in writing by the Employee and such officer(s) as may be specifically authorized by the Board to effect it. No waiver by any Party of any breach by any other Party of, or of compliance with, any term or condition of this Agreement to be performed by any other Party, at any time, will constitute a waiver of similar or dissimilar terms or conditions at that time or at any prior or subsequent time.

8.3 Entire Agreement . This Agreement, together with any documents specifically referenced in this Agreement, embodies the entire understanding of the Parties hereto, and, upon the Effective Date, will supersede all other oral or written agreements or understandings between them regarding the subject matter hereof including, without limitation, the Prior Agreement; provided, however, that if there is a conflict between any of the terms in this Agreement and the

 

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terms in any award agreement between the Company and the Employee pursuant to any long-term incentive plan or otherwise, the terms of the award agreement shall govern. No agreement or representation, oral or otherwise, express or implied, with respect to the subject matter of this Agreement, has been made by either Party which is not set forth expressly in this Agreement or the other documents referenced in this Section 8.3 .

8.4 Governing Law . The validity, interpretation, construction and performance of this Agreement will be governed by the laws of the State of Texas other than the conflict of laws provision thereof.

8.5 Consent to Jurisdiction; Service of Process ; Waiver of Right to Jury Trial .

(a) Disputes . In the event of any dispute, controversy or claim between the Company and the Employee arising out of or relating to the interpretation, application or enforcement of the provisions of this Agreement, the Company and the Employee agree and consent to the personal jurisdiction of the state and local courts of Harris County, Texas and/or the United States District Court for the Southern District of Texas, Houston Division for resolution of the dispute, controversy or claim, and that those courts, and only those courts, shall have any jurisdiction to determine any dispute, controversy or claim related to, arising under or in connection with this Agreement. The Company and the Employee also agree that those courts are convenient forums for the parties to any such dispute, controversy or claim and for any potential witnesses and that process issued out of any such court or in accordance with the rules of practice of that court may be served by mail or other forms of substituted service to the Company at the address of its principal executive offices and to the Employee at the Employee’s last known address as reflected in the Company’s records.

(b) Waiver of Right to Jury Trial . THE COMPANY AND THE EMPLOYEE HEREBY VOLUNTARILY, KNOWINGLY AND INTENTIONALLY WAIVE ANY AND ALL RIGHTS TO TRIAL BY JURY TO ALL CLAIMS ARISING OUT OF OR RELATING TO THIS AGREEMENT, AS WELL AS TO ALL CLAIMS ARISING OUT OF THE EMPLOYEE’S EMPLOYMENT WITH THE COMPANY OR TERMINATION THEREFROM.

8.6 Withholding of Taxes . The Company will withhold from any amounts payable under the Agreement all federal, state, local or other taxes as legally will be required to be withheld.

8.7 Notices . All notices, consents, waivers, and other communications under this Agreement must be in writing and will be deemed to have been duly given when (a)  delivered by hand (with written confirmation of receipt), (b) sent by facsimile (with written confirmation of receipt), provided that a copy is mailed by registered mail, return receipt requested, or (c)  when received by the addressee, if sent by a nationally recognized overnight delivery service (receipt requested), in each case to the appropriate addresses and facsimile numbers set forth below (or to such other addresses and facsimile numbers as a Party may designate by notice to the other parties).

 

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To the Company :

AMPLIFY ENERGY CORP.

Attn: General Counsel

500 Dallas Street

Suite 1700

Houston, TX 77002

Facsimile: (713) 456-2940

To the Employee :

At the address reflected in the Company’s written records.

Addresses may be changed by written notice sent to the other Party at the last recorded address of that Party.

8.8 Severability . The invalidity or unenforceability of any provision or provisions of this Agreement will not affect the validity or enforceability of any other provision of this Agreement, which will remain in full force and effect.

8.9 Counterparts . This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original but all of which together will constitute one and the same instrument.

8.10 Headings . The headings used in this Agreement are for convenience only, do not constitute a part of the Agreement, and will not be deemed to limit, characterize, or affect in any way the provisions of the Agreement, and all provisions of the Agreement will be construed as if no headings had been used in the Agreement.

8.11 Construction . As used in this Agreement, unless the context otherwise requires: (a)  the terms defined herein will have the meanings set forth herein for all purposes; (b)  references to “Section” are to a section hereof; (c) “include,” “includes” and “including” are deemed to be followed by “without limitation” whether or not they are in fact followed by such words or words of like import; (d) “writing,” “written” and comparable terms refer to printing, typing, lithography and other means of reproducing words in a visible form; (e) “hereof,” “herein,” “hereunder” and comparable terms refer to the entirety of this Agreement and not to any particular section or other subdivision hereof or attachment hereto; (f)  references to any gender include references to all genders; and (g)  references to any agreement or other instrument or statute or regulation are referred to as amended or supplemented from time to time (and, in the case of a statute or regulation, to any successor provision).

8.12 Capacity; No Conflicts . The Employee represents and warrants to the Company that: (a)  the Employee has full power, authority and capacity to execute and deliver this Agreement, and to perform the Employee’s obligations hereunder, (b)  such execution, delivery and performance will not (and with the giving of notice or lapse of time, or both, would not) result in the breach of any agreement or other obligation to which the Employee is a party or is otherwise bound, and (c)  this Agreement is the Employee’s valid and binding obligation, enforceable in accordance with its terms.

[Signature page follows.]

 

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IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.

 

 

Signature Page to Employment Agreement

Exhibit 10.16

Execution Version

INDEMNIFICATION AGREEMENT

This Indemnification Agreement (“ Agreement ”) is made as of [date], by and between Amplify Energy Corp. (formerly known as Midstates Petroleum Company, Inc.), a Delaware corporation (the “ Company ”), and [ name of Indemnitee ] (“ Indemnitee ”).

RECITALS:

WHEREAS, directors, officers and other persons in service to corporations or business enterprises are subjected to expensive and time-consuming litigation relating to, among other things, matters that traditionally would have been brought only against the Company or business enterprise itself;

WHEREAS, highly competent persons have become more reluctant to serve as directors, officers or in other capacities unless they are provided with adequate protection through insurance and adequate indemnification against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the corporation;

WHEREAS, the Board of Directors of the Company (the “ Board ”) has determined that the increased difficulty in attracting and retaining such persons is detrimental to the best interests of the Company and its stockholders and that the Company should act to assure such persons that there will be increased certainty of such protection in the future;

WHEREAS, the Board has determined that, in order to attract and retain qualified individuals, the Company will attempt to maintain on an ongoing basis, at its sole expense, liability insurance to protect persons serving the Company and its subsidiaries from certain liabilities. Although the furnishing of such insurance has been a customary and widespread practice among United States-based corporations and other business enterprises, the Company believes that, given current market conditions and trends, such insurance may be available to it in the future only at higher premiums and with more exclusions;

WHEREAS, the Second Amended and Restated Certificate of Incorporation of the Company (as may be amended, the “ Certificate of Incorporation ”) requires (i) indemnification of and advancement of expenses to all officers and directors of the Company in the manner set forth therein and to the fullest extent permitted by applicable law, (ii) Indemnitee may also be entitled to indemnification pursuant to the General Corporation Law of the State of Delaware (“ DGCL ”) and (iii) the Second Amended and Restated Bylaws of the Company (as may be amended, the “ Bylaws ”) and the DGCL expressly provide that the indemnification provisions set forth therein are not exclusive and thereby contemplate that contracts may be entered into between the Company and members of the Board, officers and other persons with respect to indemnification;

WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify, and to advance expenses on behalf of, such persons to the fullest extent permitted by applicable law so that they will serve or continue to serve the Company free from undue concern that they will not be so indemnified;

WHEREAS, this Agreement is a supplement to and in furtherance of the Certificate of Incorporation and the Bylaws and any resolutions adopted pursuant thereto, and shall not be deemed a substitute therefore, nor to diminish or abrogate any rights of Indemnitee thereunder; and

WHEREAS, (i) Indemnitee does not regard the protection available under the Certificate of Incorporation and insurance as adequate in the present circumstances, (ii) Indemnitee is not or was not willing to serve as a director or officer of the Company without adequate protection, (iii) the Company desired Indemnitee to serve in such capacity, and (iv) Indemnitee is or was willing to serve on behalf of the Company on the condition that Indemnitee be so indemnified.

AGREEMENT:

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:

Section 1. Definitions . (a) As used in this Agreement:

“ Affiliate ” of any specified Person shall mean any other Person directly or indirectly controlling, controlled by or under common control with such specified Person.

“ Corporate Status ” describes the status of a person who is or was a director, officer, employee or agent of (i) the Company or (ii) any other corporation, limited liability company, partnership or joint venture, trust, employee benefit plan or other enterprise which such person is or was serving at the request of the Company, including Amplify Energy Holdings LLC (formerly known as Amplify Energy Corp.).

“ Disinterested Director ” shall mean a director of the Company who is not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

“ Emergence Date ” shall mean the “Effective Date,” as defined in the plan of reorganization of Memorial Production Partners LP, a Delaware limited partnership and predecessor of the Company, approved by order dated April 14, 2017 of the United States Bankruptcy Court for the Southern District of Texas, Houston Division in In re Memorial Production Partners LP, et al. , under Chapter 11 of the United States Bankruptcy Code (11 U.S.C. §101-1330), as amended.

“ Enterprise ” shall mean the Company and any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other enterprise of which Indemnitee is or was serving at the request of the Company as a director, officer, employee, trustee, agent or fiduciary.

“ Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended.

“ Expenses ” shall mean all reasonable costs, expenses, fees and charges, including, without limitation, attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding. Expenses also shall

 

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include, without limitation, (i) expenses incurred in connection with any appeal resulting from, incurred by Indemnitee in connection with, arising out of, or in respect of or relating to, any Proceeding, including, without limitation, the premium, security for, and other costs relating to any cost bond, supersedes bond, or other appeal bond or its equivalent, (ii) for purposes of Section  12(d) hereof only, expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise, (iii) any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, and (iv) any interest, assessments or other charges in respect of the foregoing. “Expenses” shall not include “Liabilities.”

“ Indemnity Obligations ” shall mean all obligations of the Company to Indemnitee under this Agreement, including the Company’s obligations to provide indemnification to Indemnitee and advance Expenses to Indemnitee under this Agreement.

“ Independent Counsel ” shall mean a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five (5) years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder; provided, however, that the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

“ Liabilities ” shall mean all claims, liabilities, damages, losses, judgments, orders, fines, penalties and other amounts payable in connection with, arising out of, or in respect of or relating to any Proceeding, including, without limitation, amounts paid in settlement in any Proceeding and all costs and expenses in complying with any judgment, order or decree issued or entered in connection with any Proceeding or any settlement agreement, stipulation or consent decree entered into or issued in settlement of any Proceeding.

“ Person ” shall mean any individual, corporation, partnership, limited partnership, limited liability company, trust, governmental agency or body or any other legal entity.

“ Proceeding ” shall mean any threatened, pending or completed action, claim, suit, subpoena, arbitration, alternate dispute resolution mechanism, formal or informal hearing, inquiry or investigation, litigation, inquiry, administrative hearing or any other actual, threatened or completed judicial, administrative or arbitration proceeding (including, without limitation, any such proceeding under the Securities Act of 1933, as amended, or the Exchange Act or any other federal law, state law, statute or regulation), including any appeal therefrom, whether brought in the right of the Company or otherwise, and whether of a civil, criminal, administrative or investigative nature, in each case, in which Indemnitee was, is or will be, or is threatened to be, involved as a party, witness or otherwise by reason of the fact that Indemnitee is or was a director or officer of the Company or any subsidiary or affiliate of the Company (including, without limitation, service in such capacity on or prior to the Emergence Date to the Company or Amplify Energy Holdings LLC), by reason of any actual or alleged action taken by Indemnitee or of any action taken on Indemnitee’s part while acting as director or officer of the Company or any

 

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subsidiary or affiliate of the Company (including, without limitation, any such action taken on or prior to the Emergence Date on behalf of the Company or Amplify Energy Holdings LLC), or by reason of the fact that Indemnitee is or was serving at the request of the Company or any subsidiary or affiliate of the Company as a director, officer, trustee, employee or agent of another corporation, limited liability company, partnership, joint venture, trust or other enterprise (including, without limitation, service in such capacity on or prior to the Emergence Date to the Company or Amplify Energy Holdings LLC), in each case whether or not serving in such capacity at the time any liability or expense is incurred for which indemnification, reimbursement, or advancement can be provided under this Agreement.

(b) For the purpose hereof, (i) references to the “Company” 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, employees or agents, so that if Indemnitee 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, then Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued and (ii) references to “fines” shall include any excise tax assessed with respect to any employee benefit plan; (iii) references to “serving at the request of the Company” shall include any service as a director, officer, employee or agent of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and (iv) a Person who acted in good faith and in a manner such Person reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Company” as referred to in this Agreement.

Section 2. Indemnity in Third-Party Proceedings . The Company shall indemnify and hold harmless Indemnitee, to the fullest extent permitted by applicable law, from and against all Liabilities and Expenses suffered or reasonably incurred (and, in the case of retainers, reasonably expected to be incurred) by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding (other than any Proceeding brought by or in the right of the Company to procure a judgment in its favor, which is provided for in Section  3 below), or any claim, issue or matter therein. The Company’s indemnification obligations set forth in this Section 2 shall apply (i) in respect of Indemnitee’s past, present and future service in any Corporate Status and (ii) regardless of whether Indemnitee is serving in any Corporate Status at the time any such Expense or Liability is incurred.

Section 3. Indemnity in Proceedings by or in the Right of the Company . The Company shall indemnify and hold harmless Indemnitee, to the fullest extent permitted by applicable law, from and against all Liabilities and Expenses suffered or incurred (and, in the case of retainers, reasonably expected to be incurred) by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding brought by or in the right of the Company to procure a judgment in its favor, or any claim, issue or matter therein. If applicable law so prohibits, no indemnification for Expenses shall be made under this Section  3 in respect of any claim, issue or matter as to which Indemnitee shall have been finally adjudged by a court to be liable to the Company, unless and only to the

 

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extent that the Delaware Court of Chancery or any court in which the Proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnification. The Company’s indemnification obligations set forth in this Section 3 shall apply (i) in respect of Indemnitee’s past, present and future service in any Corporate Status and (ii) regardless of whether Indemnitee is serving in any Corporate Status at the time any such Expense or Liability is incurred.

Section 4. Indemnification for Expenses of a Party Who is Wholly or Partly Successful . Notwithstanding any other provisions of this Agreement, and without limiting the rights of Indemnitee under any other provision hereof, including any rights to indemnification pursuant to Sections 2 or 3 hereof, to the fullest extent permitted by applicable law, to the extent that Indemnitee is successful, on the merits or otherwise, in any Proceeding or in defense of any claim, issue or matter therein, in whole or in part, the Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred (and, in the case of retainers, reasonably expected to be incurred) by Indemnitee or on Indemnitee’s behalf in connection with each successfully resolved Proceeding, claim, issue or matter. For purposes of this Section  4 and without limitation, the termination of any Proceeding or claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

Section 5. Indemnification For Expenses of a Witness . Notwithstanding any other provision of this Agreement, to the fullest extent permitted by applicable law and to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a witness or otherwise a participant in any Proceeding to which Indemnitee is not a party and is not threatened to be made a party, Indemnitee shall be indemnified against all Expenses suffered or incurred (or, in the case of retainers, reasonably expected to be incurred) by Indemnitee or on Indemnitee’s behalf in connection therewith.

Section 6. Additional Indemnification . Notwithstanding any limitation in Sections 2 , 3 or 4 hereof, the Company shall indemnify Indemnitee to the fullest extent permitted by applicable law if Indemnitee is a party to or threatened to be made a party to any Proceeding (including a Proceeding by or in the right of the Company to procure a judgment in its favor) against all Expenses suffered or reasonably incurred (and, in the case of retainers, reasonably expected to be incurred) by Indemnitee in connection with such Proceeding, including but not limited to:

(a) the fullest extent permitted by the provision of the DGCL that authorizes or contemplates additional indemnification by agreement, or the corresponding provision of any amendment to or replacement of the DGCL; and

(b) the fullest extent authorized or permitted by any amendments to or replacements of the DGCL adopted after the date of this Agreement that increase the extent to which a corporation may indemnify its officers and directors.

 

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Section 7. Exclusions . Notwithstanding any provision in this Agreement, the Company shall not be obligated under this Agreement to indemnify or hold harmless Indemnitee, or, in the case of (a) and (c), to advance Expenses to Indemnitee:

(a) for which payment has actually been made to or on behalf of Indemnitee under any insurance policy obtained by the Company except with respect to any excess beyond the amount paid under such insurance policy;

(b) for an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act or similar provisions of state statutory law or common law;

(c) except as provided in Section  12(d) of this Agreement, in connection with any Proceeding (or any part of any Proceeding) initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees or other indemnitees, unless (i) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation or (ii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law (for the avoidance of doubt, Indemnitee shall not be deemed, for purposes of this subsection, to have initiated or brought any claim by reason of (a) having asserted any affirmative defenses in connection with a claim not initiated by Indemnitee or (b) having made any counterclaim (whether permissive or mandatory) in connection with any claim not initiated by Indemnitee); or

(d) if a final decision by a court having jurisdiction in the matter that is not subject to appeal shall determine that such indemnification is not lawful.

Section 8. Advancement . The Company shall advance, to the extent not prohibited by applicable law, the Expenses and Liabilities reasonably incurred by Indemnitee in connection with any Proceeding, and such advancement shall be made within ten (10) days after the receipt by the Company of a statement or statements requesting such advances from time to time, whether prior to or after final disposition of any Proceeding. Advances shall be unsecured and interest free. Advances shall be made without regard to Indemnitee’s ability to repay the Expenses and without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement. Advances shall include any and all Expenses reasonably incurred pursuing an action to enforce this right of advancement, including Expenses incurred preparing and forwarding statements to the Company to support the advances claimed. Indemnitee shall qualify for advances upon the execution and delivery to the Company of this Agreement, which shall constitute an undertaking providing that Indemnitee undertakes to repay the amounts advanced to the extent that it is ultimately determined by final judicial decision from which all rights to appeal have been exhausted or lapsed that the Indemnitee is not entitled to be indemnified by the Company. Nothing in this Section  8 shall limit Indemnitee’s right to advancement pursuant to Section  12(d) of this Agreement. This Section  8 shall not apply to any claim made by Indemnitee for which indemnity is excluded pursuant to Sections 7(a) or (c)  hereof.

Section 9. Procedure for Notification and Defense of Claim .

(a) Indemnitee shall promptly notify the Company in writing of any Proceeding with respect to which Indemnitee intends to seek indemnification hereunder (the date of such notification, the “ Submission Date ”). The written notification to the Company shall include a description of the nature of the Proceeding and the facts underlying the Proceeding. To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written request,

 

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including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification following the final disposition of such Proceeding, including any appeal therein. Any delay or failure by Indemnitee to notify the Company hereunder will not relieve the Company from any liability which it may have to Indemnitee hereunder or otherwise than under this Agreement, and any delay or failure in so notifying the Company shall not constitute a waiver by Indemnitee of any rights under this Agreement. The Secretary of the Company shall, promptly upon receipt of such a request for indemnification, advise the Board in writing that Indemnitee has requested indemnification.

(b) In the event Indemnitee is entitled to indemnification and/or advancement with respect to any Proceeding, Indemnitee may, at Indemnitee’s option, (i) retain counsel (including local counsel) selected by Indemnitee and approved by the Company to defend Indemnitee in such Proceeding, at the sole expense of the Company (which approval shall not be unreasonably withheld, conditioned or delayed), or (ii) have the Company assume the defense of Indemnitee in such Proceeding, in which case the Company shall assume the defense of such Proceeding with counsel selected by the Company and approved by Indemnitee (which approval shall not be unreasonably withheld, conditioned or delayed) within ten (10) days of the Company’s receipt of written notice of Indemnitee’s election to cause the Company to do so. If the Company is required to assume the defense of any such Proceeding, it shall engage legal counsel for such defense, and the Company shall be solely responsible for all fees and expenses of such legal counsel and otherwise of such defense. Such legal counsel may represent both Indemnitee and the Company (and any other party or parties entitled to be indemnified by the Company with respect to such matter) unless, in the reasonable opinion of legal counsel to Indemnitee, there is a conflict of interest between Indemnitee and the Company (or any other such party or parties) or there are legal defenses available to Indemnitee that are not available to the Company (or any such other party or parties). Notwithstanding either party’s assumption of responsibility for defense of a Proceeding, each party shall have the right to engage separate counsel at its own expense. If the Company has responsibility for defense of a Proceeding, the Company shall provide the Indemnitee and its counsel with all copies of pleadings and material correspondence relating to the Proceeding. Indemnitee and the Company shall reasonably cooperate in the defense of any Proceeding with respect to which indemnification is sought hereunder, regardless of whether the Company or Indemnitee assumes the defense thereof. Indemnitee may not settle or compromise any Proceeding without the prior written consent of the Company, which consent shall not be unreasonably withheld, conditioned or delayed. The Company may not settle or compromise any Proceeding without the prior written consent of Indemnitee.

Section 10. Procedure Upon Application for Indemnification .

(a) Upon written request by Indemnitee for indemnification pursuant to Section  9(a) hereof, if any determination by the Company is required by applicable law with respect to Indemnitee’s entitlement thereto, such determination shall be made (i) if Indemnitee shall request such determination be made by Independent Counsel, by Independent Counsel, and (ii) in all other circumstances, (A) by a majority vote of the Disinterested Directors, even though less than a quorum of the Board, (B) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum of the Board, (C) if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by Independent Counsel

 

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in a written opinion to the Board, a copy of which shall be delivered to Indemnitee, or (D) if so directed by the Board, by the stockholders of the Company holding a majority of the securities of the Company entitled to vote; and, if it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten (10) days after such determination. Indemnitee shall cooperate with the person, persons or entity making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. Any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall, to the fullest extent permitted by law, be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom. The Company will not deny any written request for indemnification hereunder made in good faith by Indemnitee unless a determination as to Indemnitee’s entitlement to such indemnification described in this Section  10(a) has been made. The Company promptly will advise Indemnitee in writing with respect to any determination that Indemnitee is not entitled to indemnification, including a description of any reason or basis for which indemnification has been denied. The Company agrees to pay the reasonable fees and expenses of the Independent Counsel referred to above and to fully indemnify such counsel against any and all Liabilities and Expenses arising out of or relating to this Agreement or its engagement pursuant hereto.

(b) In the event the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section  10(a) hereof, (i) the Independent Counsel shall be selected by the Indemnitee within ten (10) days of the Submission Date (the cost of such Independent Counsel to be paid by the Company), (ii) the Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected and (iii) the Company may, within ten (10) days after such written notice of selection shall have been given, deliver to the Indemnitee the Company’s written objection to such selection. Such objection by the Company may be asserted only on the ground that the Independent Counsel selected does not meet the requirements of “Independent Counsel” as defined in this Agreement. If such written objection is made and substantiated, the Independent Counsel selected shall not serve as Independent Counsel unless and until the Company withdraws the objection or a court has determined that such objection is without merit. Absent a timely objection, the person so selected shall act as Independent Counsel. If no Independent Counsel shall have been selected and not objected to before the later of (i) thirty (30) days after the Submission Date and (ii) ten (10) days after the final disposition of the Proceeding, including any appeal therein, each of the Company and Indemnitee shall select a law firm or member of a law firm meeting the qualifications to serve as Independent Counsel, and such law firms or members of law firms shall select the Independent Counsel.

Upon the due commencement of any judicial proceeding or arbitration pursuant to Section  12(a) of this Agreement, Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

 

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Section 11. Presumptions and Effect of Certain Proceedings .

(a) In making a determination with respect to entitlement to indemnification hereunder, the person, persons or entity making such determination shall, to the fullest extent not prohibited by applicable law, presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section  9(a) of this Agreement, and the Company shall, to the fullest extent not prohibited by applicable law, have the burden of proof to overcome that presumption in connection with the making by any person, persons or entity of any determination contrary to that presumption. Neither the failure of the person, persons or entity to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the person, persons or entity that Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.

(b) Subject to Section  12(e) hereof, if the person, persons or entity empowered or selected under Section  10 of this Agreement to determine whether Indemnitee is entitled to indemnification shall not have made a determination within thirty (30) days after receipt by the Company of the request therefore, the requisite determination of entitlement to indemnification shall, to the fullest extent not prohibited by applicable law, be deemed to have been made and Indemnitee shall be entitled to such indemnification, absent a prohibition of such indemnification under applicable law; provided, however, that such 30-day period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if (i) the determination is to be made by Independent Counsel and the Company objects to the Indemnitee’s selection of Independent Counsel and (ii) the Independent Counsel ultimately selected requires such additional time for the obtaining or evaluating of documentation or information relating thereto; provided further, however, that such 30-day period may also be extended for a reasonable time, not to exceed an additional sixty (60) days, if the determination of entitlement to indemnification is to be made by the stockholders of the Company.

(c) The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.

(d) Reliance as Safe Harbor . For purposes of any determination of good faith, Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on the records or books of account of the Enterprise, including financial statements, or on information supplied to Indemnitee by the officers of the Enterprise in the course of their duties, or on the advice of legal counsel for the Enterprise or on information or records given or reports made to the Enterprise by an independent certified public accountant or by an appraiser or other expert selected with the reasonable care by the Enterprise. The provisions of this Section  11(d) shall not be deemed to be exclusive or to limit in any way the other circumstances in which Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.

 

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(e) Actions of Others . The knowledge or actions, or failure to act, of any director, officer, agent or employee of the Enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.

Section 12. Remedies of Indemnitee .

(a) Subject to Section  12(e) hereof, in the event that (i) a determination is made pursuant to Section  10 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement is not timely made pursuant to Section  8 of this Agreement, (iii) no determination of entitlement to indemnification shall have been timely made pursuant to Section  10(a) of this Agreement, (iv) payment of indemnification is not made pursuant to Sections 4 or 5 or the third to the last sentence of Section  10(a) of this Agreement within ten (10) days after receipt by the Company of a written request therefor, (v) payment of indemnification pursuant to Sections 2 , 3 or 6 of this Agreement is not made within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification, or (vi) in the event that the Company or any other Person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or proceeding designed to deny, or to recover from, Indemnitee the benefits provided or intended to be provided to Indemnitee hereunder, Indemnitee shall be entitled to an adjudication by a court of Indemnitee’s entitlement to such indemnification or advancement. Alternatively, Indemnitee, at Indemnitee’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. The Company shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

(b) In the event that a determination shall have been made pursuant to Section  10(a) of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section  12 shall be conducted in all respects as a de novo trial, or arbitration, on the merits and Indemnitee shall not be prejudiced by reason of that adverse determination. In any judicial proceeding or arbitration commenced pursuant to this Section  12 the Company shall have the burden of proving Indemnitee is not entitled to indemnification or advancement, as the case may be, and the Company may not refer to or introduce into evidence any determination made pursuant to Section  10 of this Agreement adverse to Indemnitee for any purpose.

(c) If a determination shall have been made pursuant to Section  10(a) of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section  12 , absent a prohibition of such indemnification under applicable law.

(d) The Company shall, to the fullest extent not prohibited by applicable law, be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section  12 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Company is bound by all the provisions of this Agreement. It is the intent of the Company that Indemnitee not be required to incur Expenses associated with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to Indemnitee

 

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hereunder. The Company shall indemnify Indemnitee against any and all Expenses and, if requested by Indemnitee, shall (within ten (10) days after receipt by the Company of a written request therefore) advance, to the extent not prohibited by applicable law, such Expenses to Indemnitee, which are incurred by Indemnitee in connection with any action brought by Indemnitee for indemnification or advancement from the Company under this Agreement or the Certificate of Incorporation, or under any directors’ and officers’ liability insurance policies maintained by the Company, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advancement or insurance recovery, as the case may be.

(e) Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement to indemnification under this Agreement shall be required to be made prior to the final disposition of the Proceeding, including any appeal therein.

Section 13. Director and Officer Liability Insurance .

(a) The Company shall obtain and maintain a policy or policies of insurance (“ D&O Liability Insurance ”) with reputable insurance companies providing liability insurance for directors, former directors and officers of the Company or Amplify Energy Holdings LLC in their capacities as such (and for any capacity in which any director or officer of the Company serves any corporation, limited liability company, partnership, joint venture, trust or other enterprise at the request of the Company), in respect of acts or omissions occurring while serving in such capacity, on terms with respect to coverage and amount (including with respect to the payment of Expenses) no less favorable than those of such policy in effect on the date hereof, except for any changes approved by the Board and, to the extent such change materially adversely affects the Indemnitee, the Indemnitee; provided that such coverage and amounts are available on commercially reasonable terms. Upon request by Indemnitee, the Company shall provide copies of all policies of D&O Liability Insurance obtained and maintained in accordance with this Section 13 of this Agreement. The Company shall promptly notify Indemnitee of any changes in such insurance coverage.

Section 14. Non-Exclusivity; Survival of Rights; Insurance; Subrogation .

(a) The rights of indemnification and to receive advancement as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation, the Bylaws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in Indemnitee’s Corporate Status prior to such amendment, alteration or repeal. To the extent that a change in Delaware law, whether by statute or judicial decision, permits greater indemnification or advancement than would be afforded currently under the Certificate of Incorporation or this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

 

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(b) The Company hereby acknowledges that Indemnitee may have certain rights to indemnification, advancement and insurance provided by one or more Persons with whom or which Indemnitee may be associated. The Company hereby acknowledges and agrees that (i)  the Company shall be the indemnitor of first resort with respect to any Proceeding, Expense, Liability or matter that is the subject of the Indemnity Obligations, (ii)  the Company shall be primarily liable for all Indemnity Obligations and any indemnification afforded to Indemnitee in respect of any Proceeding, Expense, Liability or matter that is the subject of Indemnity Obligations, whether created by applicable law, organizational or constituent documents, contract (including this Agreement) or otherwise, (iii)  any obligation of any other Persons with whom or which Indemnitee may be associated to indemnify Indemnitee or advance Expenses or Liabilities to Indemnitee in respect of any Proceeding shall be secondary to the obligations of the Company hereunder, (iv)  the Company shall be required to indemnify Indemnitee and advance Expenses or Liabilities to Indemnitee hereunder to the fullest extent provided herein without regard to any rights Indemnitee may have against any other Person with whom or which Indemnitee may be associated or insurer of any such Person and (v)  the Company irrevocably waives, relinquishes and releases any other Person with whom or which Indemnitee may be associated from any claim of contribution, subrogation or any other recovery of any kind in respect of amounts paid by the Company hereunder. In the event any other Person with whom or which Indemnitee may be associated or their insurers advances or extinguishes any liability or loss which is the subject of any Indemnity Obligation owed by the Company or payable under any Company insurance policy, the payor shall have a right of subrogation against the Company or its insurer or insurers for all amounts so paid which would otherwise be payable by the Company or its insurer or insurers under this Agreement. In no event will payment of an Indemnity Obligation by any other Person with whom or which Indemnitee may be associated or their insurers affect the obligations of the Company hereunder or shift primary liability for any Indemnity Obligation to any other Person with whom or which Indemnitee may be associated. Any indemnification, insurance or advancement provided by any other Person with whom or which Indemnitee may be associated with respect to any liability arising as a result of Indemnitee’s Corporate Status or capacity as an officer or director of any Person is specifically in excess over any Indemnity Obligation of the Company or valid and any collectible insurance (including but not limited to any malpractice insurance or professional errors and omissions insurance) provided by the Company under this Agreement.

(c) Indemnitee shall be covered by the Company’s D&O Liability Insurance in accordance with its or their terms to the maximum extent of the coverage available for any such director, officer, employee, trustee or agent under such policy or policies. If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such Proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies. The failure or refusal of any such insurer to pay any such amount shall not affect or impair the obligations of the Company under this Agreement.

 

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(d) In the event of any payment under this Agreement, the Company shall be subrogated to the rights of recovery of Indemnitee, including rights of indemnification provided to Indemnitee from any other person or entity with whom Indemnitee may be associated; provided, however, that the Company shall not be subrogated to the extent of any such payment of all rights of recovery of Indemnitee with respect to any Person with whom or which Indemnitee may be associated.

(e) The indemnification and contribution provided for in this Agreement will remain in full force and effect regardless of any investigation made by or on behalf of Indemnitee.

Section 15. Duration of Agreement; Not Employment Contract . This Agreement shall be effective with respect to Indemnitee as of the date that Indemnitee was appointed as a director or officer of the Company and shall continue until and terminate upon the latest of: (i) ten (10) years after the date that Indemnitee shall have ceased to serve as a director or officer of any Enterprise and (ii) one (1) year after the date of final termination of any Proceeding, including any appeal, then pending in respect of which Indemnitee is granted rights of indemnification or advancement hereunder and of any proceeding, including any appeal, commenced by Indemnitee pursuant to Section  12 of this Agreement relating thereto. This Agreement shall be binding upon the Company and its successors and assigns and shall inure to the benefit of Indemnitee and Indemnitee’s heirs, executors and administrators. The Company shall require and cause any successor, and any direct or indirect parent of any successor, whether direct or indirect by purchase, merger, consolidation or otherwise, to all, substantially all or a substantial part, of the business and/or assets of the Company, by written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. This Agreement shall not be deemed an employment contract between the Company (or any of its subsidiaries or any other Enterprise) and Indemnitee. Indemnitee specifically acknowledges that Indemnitee’s employment with the Company (or any of its subsidiaries or any other Enterprise), if any, is at will, and Indemnitee may be discharged at any time for any reason, with or without cause, except as may be otherwise provided in any written employment contract between Indemnitee and the Company (or any of its subsidiaries or any other Enterprise), other applicable formal severance policies duly adopted by the Board, or, with respect to service as a director of the Company, by the Certificate of Incorporation, the Bylaws or the DGCL.

Section 16. Severability . If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by applicable law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

 

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Section 17. Enforcement .

(a) The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director or officer of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving as a director or officer of the Company.

(b) This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided, however, that this Agreement is a supplement to and in furtherance of the Certificate of Incorporation, the Bylaws and applicable law, and shall not be deemed a substitute therefore, nor diminish or abrogate any rights of Indemnitee thereunder.

Section 18. Modification and Waiver . No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by the parties thereto. No waiver of any of the provisions of this Agreement shall be deemed to be or shall constitute a waiver of any other provision of this Agreement nor shall any waiver constitute a continuing waiver.

Section 19. Notices . All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, (b) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed, (c) mailed by reputable overnight courier and receipted for by the party to whom said notice or other communication shall have been directed or (d) sent by facsimile transmission, with receipt of oral confirmation that such transmission has been received:

(a) If to Indemnitee, at the address indicated on the signature page of this Agreement, or such other address as Indemnitee shall provide to the Company.

(b) If to the Company to

Amplify Energy Corp.

500 Dallas Street, Suite 1700

Houston, TX 77002

Attention: Board of Directors

or to any other address as may have been furnished to Indemnitee by the Company.

Section 20. Contribution . To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for Liabilities or for Expenses, in connection with any Proceeding, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and transaction(s) giving cause to such Proceeding; and (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and transaction(s).

 

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Section 21. Applicable Law and Consent to Jurisdiction . This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules. Except with respect to any arbitration commenced by Indemnitee pursuant to Section  12(a) of this Agreement, the Company and Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Chancery Court of the State of Delaware (the “ Delaware Court ”), and not in any other state or federal court in the United States of America or any court in any other country, (ii) consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any action or proceeding arising out of or in connection with this Agreement, (iii) consent to service of process at the address set forth in Section 19 of this Agreement with the same legal force and validity as if served upon such party personally within the State of Delaware; (iv) waive any objection to the laying of venue of any such action or proceeding in the Delaware Court, and (v) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Delaware Court has been brought in an improper or inconvenient forum.

Section 22. Counterparts . This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.

Section 23. Miscellaneous . Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

 

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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year first above written.

 

Signature Page to Indemnification Agreement

Exhibit 10.20

Amplify Energy Corp.

Management Incentive Plan

Restricted Stock Unit Award Agreement

This Restricted Stock Unit Award Agreement (this “ Agreement ”) is made by and between Amplify Energy Corp., a Delaware corporation (the “ Company ”), and the individual (the “ Participant ”) whose name is set forth on the signature page attached here to (the “ Signature Page ”), effective as of the date set forth on the Signature Page as the “Date of Grant”, pursuant to the Amplify Energy Corp. Management Incentive Plan (as the same may be amended from time to time, the “ Plan ”).

RECITALS

WHEREAS , the Company has adopted the Plan, which is incorporated herein by reference and made a part of this Agreement, and capitalized terms not otherwise defined in this Agreement shall have the meanings ascribed to those terms in the Plan; and

WHEREAS , the Committee has authorized and approved the grant of an Award to the Participant that will provide the Participant the opportunity to receive shares of Common Stock upon the settlement of stock units on the terms and conditions set forth in the Plan and this Agreement (“ Restricted Stock Units ”).

NOW THEREFORE , in consideration of the premises and mutual covenants set forth in this Agreement, the parties hereto agree as follows:

1. Grant of Restricted Stock Unit Award . The Company hereby grants to the Participant the number of Restricted Stock Units set forth on the Signature Page, on the terms and conditions set forth in the Plan and this Agreement, subject to adjustment as set forth in the Plan. Each Restricted Stock Unit represents the promise of the Company to deliver shares of Common Stock (initially one share of Common Stock per Restricted Stock Unit) to the Participant pursuant to the terms and conditions of the Plan and this Agreement.

2. Vesting of Restricted Stock Units . Subject to the terms and conditions set forth in the Plan and this Agreement, the Restricted Stock Units shall vest as follows:

a. Time-Vesting RSUs . Fifty percent (50%) of the Restricted Stock Units shall be subject to time-vesting conditions (“ TSUs ”) and shall vest in accordance with the following schedule, subject to the Participant’s continued Service through each applicable vesting date, except as otherwise provided in this Section  2 :

 

Vesting Date		Cumulative Vested Percentage
First Anniversary of the Date of Grant		33 1 ⁄ 3 %
Second Anniversary of the Date of Grant		66 2 ⁄ 3 %
Third Anniversary of the Date of Grant		100%

b. Performance-Vesting RSUs . Fifty percent (50%) of the Restricted Stock Units shall be subject to both time-vesting and performance-vesting conditions (“ PSUs ”).

A PSU shall only become vested and subject to settlement upon satisfaction of both the time-vesting condition and the performance-vesting condition.

(i) The PSUs shall performance vest based on the Company’s achievement of the 15-Day VWAP targets set forth below on or before the third anniversary of the Date of Grant (such period, the “ Performance Period ”), subject to the Participant’s continued Service through each applicable vesting date. For purposes of this Agreement, “ 15-Day VWAP ” means the volume-weighted average price per share of Common Stock over fifteen (15) consecutive trading days. In the event the Company makes a significant return of capital to its shareholders during the Performance Period, the Company and the Participant will work together in good faith to effectuate any necessary adjustments to the 15-Day VWAP Targets.

 

15-Day VWAP Target		Cumulative Performance-Vested Percentage
At or above $12.50		33 1 ⁄ 3 %
At or above $15.00		66 2 ⁄ 3 %
At or above $17.50		100%

Any PSU that does not performance vest prior to the conclusion of the Performance Period shall be forfeited immediately and without consideration at the conclusion of the Performance Period.

(ii) Any PSUs with respect to which the performance condition is satisfied during the Performance Period (the “ Performance-Vested PSUs ”) will be subject to time-based vesting, such that 50% of the Performance-Vested PSUs will time vest on the applicable performance-vesting date, and an additional 25% of the Performance-Vested PSUs will time vest on each of the first and second anniversaries of the date on which such Performance-Vested PSUs performance-vested, subject to the Participant’s continued Service through each applicable vesting date.

c. [Reserved] .

d. Change of Control . If a Change of Control is consummated during the Participant’s Service, all TSUs shall fully vest, and all PSUs shall fully time vest, upon the consummation of such Change of Control. Further, if a Change of Control occurs during the Performance Period, then with respect to any PSUs that have not performance vested as of the Change of Control, such PSUs shall performance vest to the extent that the price per share of Common Stock achieved in the Change of Control equals or exceeds the 15-Day VWAP targets set forth above. Any PSUs that have not performance-vested in accordance with Section  2.b and this Section  2.d as of such Change of Control will be forfeited immediately and without consideration.

e. Forfeiture . Any Restricted Stock Units that are not fully vested will be forfeited immediately and without consideration upon a termination of the Participant’s Service for any or no reason.

 

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3. Dividend Equivalent Rights . Each Restricted Stock Unit is granted together with dividend equivalent rights, which dividend equivalent rights will be (a) accumulated and deemed reinvested in additional Restricted Stock Units and (b) subject to the same vesting and forfeiture provisions as the Restricted Stock Units granted pursuant to Section  2 . Any payments made pursuant to dividend equivalent rights will be paid in either cash or in shares of Common Stock, or any combination thereof, as elected by the Participant (to the extent permissible under applicable law), effective as of the date of settlement under Section  4 below.

4. Payment .

a. Settlement . Promptly following the vesting date of the Restricted Stock Units (but no later than 60 days following each such vesting date), the Company shall deliver to the Participant (or the Participant’s legal representatives of the estate of the Participant) a number of shares of Common Stock equal to the aggregate number of Restricted Stock Units that vested as of such date. No fractional shares of Common Stock shall be delivered; the Company shall pay cash in respect of any fractional shares of Common Stock. The Company may deliver such shares either through book entry accounts held by, or in the name of, the Participant or cause to be issued a certificate or certificates representing the number of shares of Common Stock to be issued in respect of the Restricted Stock Units, registered in the name of the Participant. If the 60-day period following the vesting date of the Restricted Stock Units extends across two calendar years, settlement shall always occur in the second calendar year.

b. Withholding Requirements . The Company shall have the power and the right to deduct or withhold automatically from any shares of Common Stock or cash deliverable under this Agreement, or to require the Participant or the Participant’s representative to remit to the Company, the amount necessary to satisfy federal, state and local taxes required by law or regulation to be withheld with respect to any taxable event arising as a result of this Agreement (collectively, “ Withheld Taxes ”). If the Restricted Stock Units are settled in shares of Common Stock, all or a portion of the applicable Withheld Taxes may, except as otherwise determined by the Committee at such time, be paid by reducing the number of shares of Common Stock otherwise deliverable upon such settlement by the number of shares of Common Stock having an aggregate Fair Market Value equal to the applicable Withheld Taxes (or a portion thereof).

5. Adjustment of Shares of Common Stock . In the event of any change with respect to the outstanding shares of Common Stock contemplated by Section 4.4 of the Plan, the number of Restricted Stock Units and the performance vesting conditions set forth in Section  2.b may be adjusted in accordance with Section 4.4 of the Plan.

6. [Reserved] .

 

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7. Miscellaneous Provisions .

a. Securities Laws Requirements . No shares of Common Stock will be issued or transferred pursuant to this Agreement unless and until all then applicable requirements imposed by federal and state securities and other laws, rules and regulations and by any regulatory agencies having jurisdiction, and by any exchanges upon which the shares of Common Stock may be listed, have been fully met. As a condition precedent to the issuance of shares of Common Stock pursuant to this Agreement, the Company may require the Participant to take any reasonable action to meet those requirements. The Committee may impose such conditions on any shares of Common Stock issuable pursuant to this Agreement as it may deem advisable, including, without limitation, restrictions under the Securities Act, under the requirements of any exchange upon which shares of the same class are then listed and under any blue sky or other securities laws applicable to those shares of Common Stock.

b. Rights of a Shareholder of the Company . Prior to settlement of the Restricted Stock Units in shares of Common Stock, neither the Participant nor the Participant’s representative will have any rights as a shareholder of the Company with respect to any shares of Common Stock underlying the Restricted Stock Units.

c. Transfer Restrictions . The shares of Common Stock delivered hereunder will be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which such shares are listed, any applicable federal or state laws and any agreement with, or policy of, the Company or the Committee to which the Participant is a party or subject, and the Committee may cause orders or designations to be placed upon the books and records of the Company’s transfer agent to make appropriate reference to such restrictions.

d. No Right to Continued Service . Nothing in this Agreement or the Plan confers upon the Participant any right to continue in Service for any period of specific duration or interferes with or otherwise restricts in any way the rights of the Company (or any Subsidiary employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate the Participant’s Service at any time and for any reason, with or without cause.

e. No Transfer of Restricted Stock Units . The Participant shall not sell, assign, transfer, exchange, pledge, encumber, gift, devise, hypothecate or otherwise dispose of (collectively, “ Transfer ”) any Restricted Stock Units granted hereunder. Any purported Transfer of Restricted Stock Units in breach of this Agreement shall be void and ineffective and shall not operate to Transfer any interest or title in the purported transferee.

f. Notification . Any notification required by the terms of this Agreement will be given by the Participant (i) in writing addressed to the Company at its principal executive office and will be deemed effective upon actual receipt when delivered by personal delivery or by registered or certified mail, with postage and fees prepaid, or (ii) by electronic transmission to the Company’s e-mail address of the Company’s General Counsel and will be deemed effective upon actual receipt. Any notification required by the terms of this Agreement will be given by the Company (x) in writing addressed to the address that the Participant most recently provided to the Company and will be deemed effective upon personal delivery or within three (3) days of deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid, or (y) by facsimile or electronic transmission to the Participant’s primary work fax number or e-mail address (as applicable), and will be deemed effective upon confirmation of receipt by the sender of such transmission.

 

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g. Entire Agreement . This Agreement and the Plan constitute the entire agreement between the parties hereto with regard to the subject matter of this Agreement. This Agreement and the Plan supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) that relate to the subject matter of this Agreement.

h. Waiver . No waiver of any breach or condition of this Agreement will be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.

i. Survival of Certain Provisions . Wherever appropriate to the intention of the parties hereto, the respective rights and obligations of the parties hereunder shall survive any termination or expiration of this Agreement or the Participant’s termination of Service.

j. Successors and Assigns . The provisions of this Agreement will inure to the benefit of, and be binding upon, the Company and its successors and assigns and upon the Participant, the Participant’s executor, personal representative(s), distributees, administrator, permitted transferees, permitted assignees, beneficiaries, and legatee(s), as applicable, whether or not any such person has become a party to this Agreement or agreed in writing to be joined herein and be bound by the terms hereof.

k. Severability . The provisions of this Agreement are severable, and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, then such provision shall be reformed to create a valid and enforceable provision to the maximum extent permitted by law; provided, however, if such provision cannot be reformed, it shall be deemed ineffective and deleted herefrom, and the remaining provisions will nevertheless be binding and enforceable. This Agreement should be construed by limiting and reducing it only to the minimum extent necessary to be enforceable under then applicable law.

l. Amendment . Except as otherwise provided in the Plan, this Agreement will not be amended unless the amendment is agreed to in writing by both the Participant and the Company.

m. Code Section  409A Compliance . It is the intention of the parties that this Agreement is written and administered, and will be interpreted and construed, in a manner such that no amount under this Agreement becomes subject to (a) gross income inclusion under Code Section 409A or (b) interest and additional tax under Code Section 409A (collectively, “ Section  409A Penalties ”), including, where appropriate, the construction of defined terms to have meanings that would not cause imposition of the Section 409A Penalties. Accordingly, the Participant consents to any amendment of this Agreement which the Company may reasonably make in furtherance of such intention, and the Company shall promptly provide, or make available to, the Participant a copy of such

 

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amendment. Further, to the extent that any terms of the Agreement are ambiguous, such terms shall be interpreted as necessary to comply with, or an exemption under, Code Section 409A when applicable. Under no circumstances will the Company have any liability for any violation of Code Section 409A.

n. Choice of Law; Jurisdiction . This Agreement and all claims, causes of action or proceedings (whether in contract, in tort, at law or otherwise) that may be based upon, arise out of or relate to this Agreement will be governed by the internal laws of the State of Delaware, excluding any conflicts or choice-of-law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. Jurisdiction and venue of any action or proceeding relating to this Agreement shall be exclusively in the federal and state courts of competent jurisdiction located in Houston, Harris County, Texas, and the parties hereby waive any objection to such venue and jurisdiction including, without limitation, that it is inconvenient.

o. Signature in Counterparts . This Agreement may be signed in counterparts, manually or electronically, each of which will be an original, with the same effect as if the signatures to each were upon the same instrument.

p. Electronic Delivery . The Company may, in its sole discretion, decide to deliver any documents related to any Awards granted under the Plan by electronic means or to request the Participant’s consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, if applicable. Such on-line or electronic system shall satisfy notification requirements discussed in Section  7.f .

q. Acceptance . The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands the terms and provisions of the Plan and this Agreement, and accepts the Restricted Stock Units subject to all of the terms and conditions of the Plan and this Agreement. In the event of a conflict between any term or provision contained in this Agreement and a term or provision of the Plan, the applicable term and provision of the Plan will govern and prevail.

r. Interpretive Matters . In the interpretation of this Agreement, except where the context otherwise requires:

(i) The headings used in this Agreement headings are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement.

(ii) The terms “including” and “include” do not denote or imply any limitation;

(iii) The conjunction “or” has the inclusive meaning “and/or”;

(iv) The singular includes the plural, and vice versa, and each gender includes each of the others;

 

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(v) Reference to any statute, rule, or regulation includes any amendment thereto or any statute, rule, or regulation enacted or promulgated in replacement thereof; and

(vi) The words “herein”, “hereof”, “hereunder” and other compounds of the word “here” shall refer to the entire Agreement and not to any particular provision.

[ Signature page follows. ]

 

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IN WITNESS WHEREOF, the Company and the Participant have executed this Restricted Stock Unit Award Agreement as of the dates set forth below.

 

 

PARTICIPANT
Participant Name: [Name] Number of RSUs: [Number] Date of Grant: [Date]

 

Signature Page to Restricted Stock Unit Award Agreement

Exhibit 10.21

Form of

Amplify Energy Corp.

Management Incentive Plan

Restricted Stock Unit Award Agreement

This Restricted Stock Unit Award Agreement (this “ Agreement ”) is made by and between Amplify Energy Corp., a Delaware corporation (the “ Company ”), and [ ] (the “ Participant ”), effective as of [ ] (the “ Date of Grant ”), pursuant to the Amplify Energy Corp. Management Incentive Plan (as the same may be amended from time to time, the “ Plan ”), and the Employment Agreement, by and between the Company and the Participant, dated [ ] (the “ Employment Agreement ”).

RECITALS

WHEREAS , the Company has adopted the Plan, which is incorporated herein by reference and made a part of this Agreement, and capitalized terms not otherwise defined in this Agreement shall have the meanings ascribed to those terms in the Plan; and

WHEREAS , the Committee has authorized and approved the grant of an Award to the Participant that will provide the Participant the opportunity to receive shares of Common Stock upon the settlement of stock units on the terms and conditions set forth in the Plan and this Agreement (“ Restricted Stock Units ”).

NOW THEREFORE , in consideration of the premises and mutual covenants set forth in this Agreement, the parties hereto agree as follows:

1. Grant of Restricted Stock Unit Award . The Company hereby grants to the Participant [                ] Restricted Stock Units, on the terms and conditions set forth in the Plan and this Agreement, subject to adjustment as set forth in the Plan. Each Restricted Stock Unit represents the promise of the Company to deliver shares of Common Stock (initially one share of Common Stock per Restricted Stock Unit) to the Participant pursuant to the terms and conditions of the Plan and this Agreement.

2. Vesting of Restricted Stock Units . Subject to the terms and conditions set forth in the Plan and this Agreement, the Restricted Stock Units shall vest as follows:

a. TSUs . Fifty percent (50%) of the Restricted Stock Units shall be subject to time-vesting conditions (“ TSUs ”) and shall vest in accordance with the following schedule, subject to the Participant’s continued Service through each applicable vesting date, except as otherwise provided in this Section  2 :

 

Vesting Date		Cumulative Vested Percentage
First Anniversary of the Date of Grant		33 1 ⁄ 3 %
Second Anniversary of the Date of Grant		66 2 ⁄ 3 %
Third Anniversary of the Date of Grant		100%

 

b. PSUs . Fifty percent (50%) of the Restricted Stock Units shall be subject to both time-vesting and performance-vesting conditions (“ PSUs ”). The PSUs shall performance vest based on the Company’s achievement of the 15-Day VWAP targets set forth below on or before the third anniversary of the Date of Grant (such period, the “ Performance Period ”), subject to the Participant’s continued Service through each applicable vesting date. For purposes of this Agreement, “ 15-Day VWAP ” means the volume-weighted average price per share of Common Stock over fifteen (15) consecutive trading days. In the event the Company makes a significant return of capital to its shareholders during the Performance Period, the Company and the Participant will work together in good faith to effectuate any necessary adjustments to the 15-Day VWAP Targets.

 

15-Day VWAP Target		Cumulative Performance-Vested Percentage
At or above $12.50		33 1 ⁄ 3 %
At or above $15.00		66 2 ⁄ 3 %
At or above $17.50		100%

Any PSU that does not performance vest prior to the conclusion of the Performance Period shall be forfeited immediately and without consideration at the conclusion of the Performance Period.

Any PSUs that performance vest during the Performance Period (the “ Performance-Vested PSUs ”) will be subject to time-based vesting, such that 50% of the Performance-Vested PSUs will time vest on the applicable performance-vesting date, and an additional 25% of the Performance-Vested PSUs will time vest on each of the first and second anniversaries of the date on which such Performance-Vested PSUs performance-vested, subject to the Participant’s continued Service through each applicable vesting date.

c. Involuntary Termination without Cause or Voluntary Termination for Good Reason . If the Participant’s Service is terminated by the Company without Cause or by the Participant for Good Reason (not due to the Participant’s death or Disability) (such termination of Service, a “ Qualifying Termination ”), (i) all TSUs shall fully vest, and all PSUs shall fully time vest, upon such termination, and (ii) if such termination occurs after the second anniversary of the Effective Date (as defined in the Employment Agreement) and prior to the end of the Performance Period, then with respect to any PSUs that have not performance-vested as of such termination, such PSUs shall performance vest to the extent that the price per share of Common Stock as of such termination equals or exceeds the 15-Day VWAP targets set forth above (in each case, reduced by $0.25), in each case, subject to the Participant’s execution and non-revocation of the Release (as defined in the Employment Agreement) no later than the 60th day following the Participant’s termination of Service. Any PSUs that have not performance-vested in accordance with Section  2.b hereof as of such termination of Service will be forfeited immediately and without consideration. For all purposes of this Agreement, the terms “ Cause ” and “ Good Reason ” shall have the definitions given to them in the Employment Agreement as of the termination date.

 

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d. Change of Control . In the event the Participant incurs a Qualifying Termination during the eighteen (18) month period immediately following a Change of Control, (i) all outstanding and unvested TSUs shall fully vest, and all PSUs shall fully time vest, and (ii) with respect to any PSUs that have not performance-vested as of such termination, such PSUs shall performance vest to the extent that the price per share of Common Stock achieved in the Change of Control equals or exceeds the 15-Day VWAP targets set forth above, in each case, subject to the Participant’s execution and non-revocation of the Release no later than 60th day following the Participant’s termination of Service. Any PSUs that have not performance-vested in accordance with Section  2.b and this Section  2.d as of such Change of Control will be forfeited immediately and without consideration.

e. Forfeiture . Any Restricted Stock Units that are not fully vested will be forfeited immediately and without consideration upon a termination of the Participant’s Service for any or no reason, except as set forth in Section  2.c .

3. Dividend Equivalent Rights . Each Restricted Stock Unit is granted together with dividend equivalent rights, which dividend equivalent rights will be (a) accumulated and deemed reinvested in additional Restricted Stock Units and (b) subject to the same vesting and forfeiture provisions as the Restricted Stock Units granted pursuant to Section  2 . Any payments made pursuant to dividend equivalent rights will be paid in either cash or in shares of Common Stock, or any combination thereof, as elected by the Participant (to the extent permissible under applicable law), effective as of the date of settlement under Section  4 below.

4. Payment .

a. Settlement . Promptly following the vesting date of the Restricted Stock Units (but no later than 60 days following each such vesting date), the Company shall deliver to the Participant (or the Participant’s legal representatives of the estate of the Participant) a number of shares of Common Stock equal to the aggregate number of Restricted Stock Units that vested as of such date. No fractional shares of Common Stock shall be delivered; the Company shall pay cash in respect of any fractional shares of Common Stock. The Company may deliver such shares either through book entry accounts held by, or in the name of, the Participant or cause to be issued a certificate or certificates representing the number of shares of Common Stock to be issued in respect of the Restricted Stock Units, registered in the name of the Participant. If the 60-day period following the vesting date of the Restricted Stock Units extends across two calendar years, settlement shall always occur in the second calendar year.

b. Withholding Requirements . The Company shall have the power and the right to deduct or withhold automatically from any shares of Common Stock or cash deliverable under this Agreement, or to require the Participant or the Participant’s representative to remit to the Company, the amount necessary to satisfy federal, state and local taxes required by law or regulation to be withheld with respect to any taxable event arising as a result of this Agreement (collectively, “ Withheld Taxes ”). If the Restricted Stock Units are settled in shares of Common Stock, all or a portion of the applicable Withheld Taxes may, except as otherwise determined by the Committee at such time, be paid by reducing the number of shares of Common Stock otherwise deliverable upon such settlement by the number of shares of Common Stock having an aggregate Fair Market Value equal to the applicable Withheld Taxes (or a portion thereof).

 

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5. Adjustment of Shares of Common Stock . In the event of any change with respect to the outstanding shares of Common Stock contemplated by Section 4.4 of the Plan, the number of Restricted Stock Units and the performance vesting conditions set forth in Section  2.b may be adjusted in accordance with Section 4.4 of the Plan.

6. Restrictive Covenants . In consideration of the Restricted Stock Units granted pursuant to this Agreement, the Participant shall comply with the restrictions relating to confidentiality, non-solicitation of employees, consultants and customers, and non-competition set out in the Employment Agreement.

7. Miscellaneous Provisions .

a. Securities Laws Requirements . No shares of Common Stock will be issued or transferred pursuant to this Agreement unless and until all then applicable requirements imposed by federal and state securities and other laws, rules and regulations and by any regulatory agencies having jurisdiction, and by any exchanges upon which the shares of Common Stock may be listed, have been fully met. As a condition precedent to the issuance of shares of Common Stock pursuant to this Agreement, the Company may require the Participant to take any reasonable action to meet those requirements. The Committee may impose such conditions on any shares of Common Stock issuable pursuant to this Agreement as it may deem advisable, including, without limitation, restrictions under the Securities Act, under the requirements of any exchange upon which shares of the same class are then listed and under any blue sky or other securities laws applicable to those shares of Common Stock.

b. Rights of a Shareholder of the Company . Prior to settlement of the Restricted Stock Units in shares of Common Stock, neither the Participant nor the Participant’s representative will have any rights as a shareholder of the Company with respect to any shares of Common Stock underlying the Restricted Stock Units.

c. Transfer Restrictions . The shares of Common Stock delivered hereunder will be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which such shares are listed, any applicable federal or state laws and any agreement with, or policy of, the Company or the Committee to which the Participant is a party or subject, and the Committee may cause orders or designations to be placed upon the books and records of the Company’s transfer agent to make appropriate reference to such restrictions.

d. No Right to Continued Service . Nothing in this Agreement or the Plan confers upon the Participant any right to continue in Service for any period of specific duration or interferes with or otherwise restricts in any way the rights of the Company (or any Subsidiary employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate [his][her] Service at any time and for any reason, with or without Cause or Good Reason.

 

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e. No Transfer of Restricted Stock Units . The Participant shall not sell, assign, transfer, exchange, pledge, encumber, gift, devise, hypothecate or otherwise dispose of (collectively, “ Transfer ”) any Restricted Stock Units granted hereunder. Any purported Transfer of Restricted Stock Units in breach of this Agreement shall be void and ineffective and shall not operate to Transfer any interest or title in the purported transferee.

f. Notification . Any notification required by the terms of this Agreement will be given by the Participant (i) in writing addressed to the Company at its principal executive office and will be deemed effective upon actual receipt when delivered by personal delivery or by registered or certified mail, with postage and fees prepaid, or (ii) by electronic transmission to the Company’s e-mail address of the Company’s General Counsel and will be deemed effective upon actual receipt. Any notification required by the terms of this Agreement will be given by the Company (x) in writing addressed to the address that the Participant most recently provided to the Company and will be deemed effective upon personal delivery or within three (3) days of deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid, or (y) by facsimile or electronic transmission to the Participant’s primary work fax number or e-mail address (as applicable), and will be deemed effective upon confirmation of receipt by the sender of such transmission.

g. Entire Agreement . This Agreement and the Plan constitute the entire agreement between the parties hereto with regard to the subject matter of this Agreement. This Agreement and the Plan supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) that relate to the subject matter of this Agreement.

h. Waiver . No waiver of any breach or condition of this Agreement will be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.

i. Survival of Certain Provisions . Wherever appropriate to the intention of the parties hereto, the respective rights and obligations of the parties hereunder shall survive any termination or expiration of this Agreement or the Participant’s termination of Service.

j. Successors and Assigns . The provisions of this Agreement will inure to the benefit of, and be binding upon, the Company and its successors and assigns and upon the Participant, the Participant’s executor, personal representative(s), distributees, administrator, permitted transferees, permitted assignees, beneficiaries, and legatee(s), as applicable, whether or not any such person has become a party to this Agreement or agreed in writing to be joined herein and be bound by the terms hereof.

k. Severability . The provisions of this Agreement are severable, and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, then such provision shall be reformed to create a valid and enforceable provision to the maximum extent permitted by law; provided, however, if such provision cannot be reformed, it shall be deemed ineffective and deleted herefrom, and the remaining provisions will nevertheless be binding and enforceable. This Agreement should be construed by limiting and reducing it only to the minimum extent necessary to be enforceable under then applicable law.

 

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l. Amendment . Except as otherwise provided in the Plan, this Agreement will not be amended unless the amendment is agreed to in writing by both the Participant and the Company.

m. Code Section  409A Compliance . It is the intention of the parties that this Agreement is written and administered, and will be interpreted and construed, in a manner such that no amount under this Agreement becomes subject to (a) gross income inclusion under Code Section 409A or (b) interest and additional tax under Code Section 409A (collectively, “ Section  409A Penalties ”), including, where appropriate, the construction of defined terms to have meanings that would not cause imposition of the Section 409A Penalties. Accordingly, the Participant consents to any amendment of this Agreement which the Company may reasonably make in furtherance of such intention, and the Company shall promptly provide, or make available to, the Participant a copy of such amendment. Further, to the extent that any terms of the Agreement are ambiguous, such terms shall be interpreted as necessary to comply with, or an exemption under, Code Section 409A when applicable. Under no circumstances will the Company have any liability for any violation of Code Section 409A.

n. Choice of Law; Jurisdiction . This Agreement and all claims, causes of action or proceedings (whether in contract, in tort, at law or otherwise) that may be based upon, arise out of or relate to this Agreement will be governed by the internal laws of the State of Delaware, excluding any conflicts or choice-of-law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. Jurisdiction and venue of any action or proceeding relating to this Agreement shall be exclusively in the federal and state courts of competent jurisdiction located in Houston, Harris County, Texas, and the parties hereby waive any objection to such venue and jurisdiction including, without limitation, that it is inconvenient.

o. Signature in Counterparts . This Agreement may be signed in counterparts, manually or electronically, each of which will be an original, with the same effect as if the signatures to each were upon the same instrument.

p. Electronic Delivery . The Company may, in its sole discretion, decide to deliver any documents related to any Awards granted under the Plan by electronic means or to request the Participant’s consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, if applicable. Such on-line or electronic system shall satisfy notification requirements discussed in Section  7.f .

q. Acceptance . The Participant hereby acknowledges receipt of a copy of the Plan, this Agreement and the Restrictive Covenant Agreement. The Participant has read and understands the terms and provisions of the Plan, this Agreement and the Restrictive Covenant Agreement, and accepts the Restricted Stock Units subject to all of the terms and conditions of the Plan and this Agreement. In the event of a conflict between any term or provision contained in this Agreement and a term or provision of the Plan, the applicable term and provision of the Plan will govern and prevail.

 

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r. Interpretive Matters . In the interpretation of this Agreement, except where the context otherwise requires:

(i) The headings used in this Agreement headings are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement.

(ii) The terms “including” and “include” do not denote or imply any limitation;

(iii) The conjunction “or” has the inclusive meaning “and/or”;

(iv) The singular includes the plural, and vice versa, and each gender includes each of the others;

(v) Reference to any statute, rule, or regulation includes any amendment thereto or any statute, rule, or regulation enacted or promulgated in replacement thereof; and

(vi) The words “herein”, “hereof”, “hereunder” and other compounds of the word “here” shall refer to the entire Agreement and not to any particular provision.

[ Signature page follows. ]

 

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IN WITNESS WHEREOF, the Company and the Participant have executed this Restricted Stock Unit Award Agreement as of the dates set forth below.

 

PARTICIPANT				AMPLIFY ENERGY CORP.
Name:				By:
Date:				Title:
				Date:

Signature Page to Restricted Stock Unit Award Agreement

Exhibit 10.22

Amplify Energy Corp.

Management Incentive Plan

Restricted Stock Unit Award Agreement

This Restricted Stock Unit Award Agreement (this “ Agreement ”) is made by and between Amplify Energy Corp., a Delaware corporation (the “ Company ”), and the individual (the “ Participant ”) whose name is set forth on the signature page attached here to (the “ Signature Page ”), effective as of the date set forth on the Signature Page as the “Date of Grant”, pursuant to the Amplify Energy Corp. Management Incentive Plan (as the same may be amended from time to time, the “ Plan ”).

RECITALS

WHEREAS , the Company has adopted the Plan, which is incorporated herein by reference and made a part of this Agreement, and capitalized terms not otherwise defined in this Agreement shall have the meanings ascribed to those terms in the Plan; and

WHEREAS , the Committee has authorized and approved the grant of an Award to the Participant that will provide the Participant the opportunity to receive shares of Common Stock upon the settlement of stock units on the terms and conditions set forth in the Plan and this Agreement (“ Restricted Stock Units ”).

NOW THEREFORE , in consideration of the premises and mutual covenants set forth in this Agreement, the parties hereto agree as follows:

1. Grant of Restricted Stock Unit Award . The Company hereby grants to the Participant the number of Restricted Stock Units set forth on the Signature Page, on the terms and conditions set forth in the Plan and this Agreement, subject to adjustment as set forth in the Plan. Each Restricted Stock Unit represents the promise of the Company to deliver shares of Common Stock (initially one share of Common Stock per Restricted Stock Unit) to the Participant pursuant to the terms and conditions of the Plan and this Agreement.

2. Vesting of Restricted Stock Units . Subject to the terms and conditions set forth in the Plan and this Agreement, the Restricted Stock Units shall vest as follows:

a. Time-Vesting RSUs . Fifty percent (50%) of the Restricted Stock Units shall be subject to time-vesting conditions (“ TSUs ”) and shall vest in accordance with the following schedule, subject to the Participant’s continued Service through each applicable vesting date, except as otherwise provided in this Section  2 :

 

Vesting Date		Cumulative Vested Percentage
First Anniversary of the Date of Grant		33 1 ⁄ 3 %
Second Anniversary of the Date of Grant		66 2 ⁄ 3 %
Third Anniversary of the Date of Grant		100%

b. Performance-Vesting RSUs . Fifty percent (50%) of the Restricted Stock Units shall be subject to both time-vesting and performance-vesting conditions (“ PSUs ”). A PSU shall only become vested and subject to settlement upon satisfaction of both the time-vesting condition and the performance-vesting condition.

(i) The PSUs shall performance vest based on the Company’s achievement of the 15-Day VWAP targets set forth below on or before the third anniversary of the Date of Grant (such period, the “ Performance Period ”), subject to the Participant’s continued Service through each applicable vesting date. For purposes of this Agreement, “ 15-Day VWAP ” means the volume-weighted average price per share of Common Stock over fifteen (15) consecutive trading days. In the event the Company makes a significant return of capital to its shareholders during the Performance Period, the Company and the Participant will work together in good faith to effectuate any necessary adjustments to the 15-Day VWAP Targets.

 

15-Day VWAP Target		Cumulative Performance-Vested Percentage
At or above $12.50			33 1 ⁄ 3	%
At or above $15.00			66 2 ⁄ 3	%
At or above $17.50			100	%

Any PSU that does not performance vest prior to the conclusion of the Performance Period shall be forfeited immediately and without consideration at the conclusion of the Performance Period.

(ii) Any PSUs with respect to which the performance condition is satisfied during the Performance Period (the “ Performance-Vested PSUs ”) will be subject to time-based vesting, such that 50% of the Performance-Vested PSUs will time vest on the applicable performance-vesting date, and an additional 25% of the Performance-Vested PSUs will time vest on each of the first and second anniversaries of the date on which such Performance-Vested PSUs performance-vested, subject to the Participant’s continued Service through each applicable vesting date.

c. [Reserved] .

d. Change of Control . If the Participant’s Service is terminated by the Company without Cause during the eighteen (18) month period immediately following a Change of Control, (i) all TSUs shall fully vest, and all PSUs shall fully time vest, and (ii) with respect to any PSUs that have not performance vested as of the date of termination of Service, such PSUs shall performance vest to the extent that the price per share of Common Stock achieved in the Change of Control equals or exceeds the 15-Day VWAP targets set forth above, in each case, subject to the Participant’s execution and non-revocation of the Release no later than 60th day following the Participant’s termination of Service. Any PSUs that have not performance-vested in accordance with Section  2.b and this Section  2.d will be forfeited immediately and without consideration.

e. Forfeiture . Any Restricted Stock Units that are not fully vested will be forfeited immediately and without consideration upon a termination of the Participant’s Service for any or no reason.

 

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3. Dividend Equivalent Rights . Each Restricted Stock Unit is granted together with dividend equivalent rights, which dividend equivalent rights will be (a) accumulated and deemed reinvested in additional Restricted Stock Units and (b) subject to the same vesting and forfeiture provisions as the Restricted Stock Units granted pursuant to Section  2 . Any payments made pursuant to dividend equivalent rights will be paid in either cash or in shares of Common Stock, or any combination thereof, as elected by the Participant (to the extent permissible under applicable law), effective as of the date of settlement under Section  4 below.

4. Payment .

a. Settlement . Promptly following the vesting date of the Restricted Stock Units (but no later than 60 days following each such vesting date), the Company shall deliver to the Participant (or the Participant’s legal representatives of the estate of the Participant) a number of shares of Common Stock equal to the aggregate number of Restricted Stock Units that vested as of such date. No fractional shares of Common Stock shall be delivered; the Company shall pay cash in respect of any fractional shares of Common Stock. The Company may deliver such shares either through book entry accounts held by, or in the name of, the Participant or cause to be issued a certificate or certificates representing the number of shares of Common Stock to be issued in respect of the Restricted Stock Units, registered in the name of the Participant. If the 60-day period following the vesting date of the Restricted Stock Units extends across two calendar years, settlement shall always occur in the second calendar year.

b. Withholding Requirements . The Company shall have the power and the right to deduct or withhold automatically from any shares of Common Stock or cash deliverable under this Agreement, or to require the Participant or the Participant’s representative to remit to the Company, the amount necessary to satisfy federal, state and local taxes required by law or regulation to be withheld with respect to any taxable event arising as a result of this Agreement (collectively, “ Withheld Taxes ”). If the Restricted Stock Units are settled in shares of Common Stock, all or a portion of the applicable Withheld Taxes may, except as otherwise determined by the Committee at such time, be paid by reducing the number of shares of Common Stock otherwise deliverable upon such settlement by the number of shares of Common Stock having an aggregate Fair Market Value equal to the applicable Withheld Taxes (or a portion thereof).

5. Adjustment of Shares of Common Stock . In the event of any change with respect to the outstanding shares of Common Stock contemplated by Section 4.4 of the Plan, the number of Restricted Stock Units and the performance vesting conditions set forth in Section  2.b may be adjusted in accordance with Section 4.4 of the Plan.

6. [Reserved] .

7. Miscellaneous Provisions .

 

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a. Securities Laws Requirements . No shares of Common Stock will be issued or transferred pursuant to this Agreement unless and until all then applicable requirements imposed by federal and state securities and other laws, rules and regulations and by any regulatory agencies having jurisdiction, and by any exchanges upon which the shares of Common Stock may be listed, have been fully met. As a condition precedent to the issuance of shares of Common Stock pursuant to this Agreement, the Company may require the Participant to take any reasonable action to meet those requirements. The Committee may impose such conditions on any shares of Common Stock issuable pursuant to this Agreement as it may deem advisable, including, without limitation, restrictions under the Securities Act, under the requirements of any exchange upon which shares of the same class are then listed and under any blue sky or other securities laws applicable to those shares of Common Stock.

b. Rights of a Shareholder of the Company . Prior to settlement of the Restricted Stock Units in shares of Common Stock, neither the Participant nor the Participant’s representative will have any rights as a shareholder of the Company with respect to any shares of Common Stock underlying the Restricted Stock Units.

c. Transfer Restrictions . The shares of Common Stock delivered hereunder will be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which such shares are listed, any applicable federal or state laws and any agreement with, or policy of, the Company or the Committee to which the Participant is a party or subject, and the Committee may cause orders or designations to be placed upon the books and records of the Company’s transfer agent to make appropriate reference to such restrictions.

d. No Right to Continued Service . Nothing in this Agreement or the Plan confers upon the Participant any right to continue in Service for any period of specific duration or interferes with or otherwise restricts in any way the rights of the Company (or any Subsidiary employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate the Participant’s Service at any time and for any reason, with or without cause.

e. No Transfer of Restricted Stock Units . The Participant shall not sell, assign, transfer, exchange, pledge, encumber, gift, devise, hypothecate or otherwise dispose of (collectively, “ Transfer ”) any Restricted Stock Units granted hereunder. Any purported Transfer of Restricted Stock Units in breach of this Agreement shall be void and ineffective and shall not operate to Transfer any interest or title in the purported transferee.

f. Notification . Any notification required by the terms of this Agreement will be given by the Participant (i) in writing addressed to the Company at its principal executive office and will be deemed effective upon actual receipt when delivered by personal delivery or by registered or certified mail, with postage and fees prepaid, or (ii) by electronic transmission to the Company’s e-mail address of the Company’s General Counsel and will be deemed effective upon actual receipt. Any notification required by the terms of this Agreement will be given by the Company (x) in writing addressed to the address that the Participant most recently provided to the Company and will be deemed effective upon personal delivery or within three (3) days of deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid, or (y) by facsimile or electronic transmission to the Participant’s primary work fax number or e-mail address (as applicable), and will be deemed effective upon confirmation of receipt by the sender of such transmission.

 

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g. Entire Agreement . This Agreement and the Plan constitute the entire agreement between the parties hereto with regard to the subject matter of this Agreement. This Agreement and the Plan supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) that relate to the subject matter of this Agreement.

h. Waiver . No waiver of any breach or condition of this Agreement will be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.

i. Survival of Certain Provisions . Wherever appropriate to the intention of the parties hereto, the respective rights and obligations of the parties hereunder shall survive any termination or expiration of this Agreement or the Participant’s termination of Service.

j. Successors and Assigns . The provisions of this Agreement will inure to the benefit of, and be binding upon, the Company and its successors and assigns and upon the Participant, the Participant’s executor, personal representative(s), distributees, administrator, permitted transferees, permitted assignees, beneficiaries, and legatee(s), as applicable, whether or not any such person has become a party to this Agreement or agreed in writing to be joined herein and be bound by the terms hereof.

k. Severability . The provisions of this Agreement are severable, and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, then such provision shall be reformed to create a valid and enforceable provision to the maximum extent permitted by law; provided, however, if such provision cannot be reformed, it shall be deemed ineffective and deleted herefrom, and the remaining provisions will nevertheless be binding and enforceable. This Agreement should be construed by limiting and reducing it only to the minimum extent necessary to be enforceable under then applicable law.

l. Amendment . Except as otherwise provided in the Plan, this Agreement will not be amended unless the amendment is agreed to in writing by both the Participant and the Company.

m. Code Section  409A Compliance . It is the intention of the parties that this Agreement is written and administered, and will be interpreted and construed, in a manner such that no amount under this Agreement becomes subject to (a) gross income inclusion under Code Section 409A or (b) interest and additional tax under Code Section 409A (collectively, “ Section  409A Penalties ”), including, where appropriate, the construction of defined terms to have meanings that would not cause imposition of the Section 409A Penalties. Accordingly, the Participant consents to any amendment of this Agreement which the Company may reasonably make in furtherance of such intention, and the Company shall promptly provide, or make available to, the Participant a copy of such

 

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amendment. Further, to the extent that any terms of the Agreement are ambiguous, such terms shall be interpreted as necessary to comply with, or an exemption under, Code Section 409A when applicable. Under no circumstances will the Company have any liability for any violation of Code Section 409A.

n. Choice of Law; Jurisdiction . This Agreement and all claims, causes of action or proceedings (whether in contract, in tort, at law or otherwise) that may be based upon, arise out of or relate to this Agreement will be governed by the internal laws of the State of Delaware, excluding any conflicts or choice-of-law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. Jurisdiction and venue of any action or proceeding relating to this Agreement shall be exclusively in the federal and state courts of competent jurisdiction located in Houston, Harris County, Texas, and the parties hereby waive any objection to such venue and jurisdiction including, without limitation, that it is inconvenient.

o. Signature in Counterparts . This Agreement may be signed in counterparts, manually or electronically, each of which will be an original, with the same effect as if the signatures to each were upon the same instrument.

p. Electronic Delivery . The Company may, in its sole discretion, decide to deliver any documents related to any Awards granted under the Plan by electronic means or to request the Participant’s consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, if applicable. Such on-line or electronic system shall satisfy notification requirements discussed in Section  7.f .

q. Acceptance . The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands the terms and provisions of the Plan and this Agreement, and accepts the Restricted Stock Units subject to all of the terms and conditions of the Plan and this Agreement. In the event of a conflict between any term or provision contained in this Agreement and a term or provision of the Plan, the applicable term and provision of the Plan will govern and prevail.

r. Interpretive Matters . In the interpretation of this Agreement, except where the context otherwise requires:

(i) The headings used in this Agreement headings are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement.

(ii) The terms “including” and “include” do not denote or imply any limitation;

(iii) The conjunction “or” has the inclusive meaning “and/or”;

(iv) The singular includes the plural, and vice versa, and each gender includes each of the others;

 

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(v) Reference to any statute, rule, or regulation includes any amendment thereto or any statute, rule, or regulation enacted or promulgated in replacement thereof; and

(vi) The words “herein”, “hereof”, “hereunder” and other compounds of the word “here” shall refer to the entire Agreement and not to any particular provision.

[ Signature page follows. ]

 

7

IN WITNESS WHEREOF, the Company and the Participant have executed this Restricted Stock Unit Award Agreement as of the dates set forth below.

 

 

PARTICIPANT

Participant Name: [Name]   Number of RSUs: [Number]   Date of Grant: [Date]

Signature Page to Restricted Stock Unit Award Agreement