| ☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
| ☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
Delaware
|
82-2769085
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|
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(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
|
|
111 East Sego Lily Drive
Salt Lake City, Utah
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84070
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|
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
|
Trading
Symbol(s)
|
Name of each exchange
on which registered |
||
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Class A common stock, $0.01 par value per share
|
BRDG
|
New York Stock Exchange
|
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
| Non-accelerated filer |
☒
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Smaller reporting company | ☐ | |||
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Emerging growth company
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☒
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Page
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3
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6
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Item 1.
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6 | |||||
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6
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| 6 | ||||||
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7
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9
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| 11 | ||||||
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| 13 | ||||||
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Item 2.
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36 | |||||
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Item 3.
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61 | |||||
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Item 4.
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61 | |||||
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63
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Item 1.
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63 | |||||
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Item 1A.
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63 | |||||
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Item 2.
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88 | |||||
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Item 3.
|
89 | |||||
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Item 4.
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89 | |||||
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Item 5.
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89 | |||||
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Item 6.
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89 | |||||
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91
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| • |
“We,” “us,” “our,” the “Company,” “Bridge,” “Bridge Investment Group” and similar references refer to Bridge Investment Group Holdings Inc., and, unless otherwise stated, all of its subsidiaries, including the Operating Company and, unless otherwise stated, all of the Operating Company’s subsidiaries.
|
| • |
“Assets under management” or “AUM” refers to the assets we manage (see following discussion in “Operating Metrics”).
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| • |
“BIGRM” refers to Bridge Investment Group Risk Management, Inc. BIGRM is incorporated in the State of Utah and is licensed under the Utah State Captive Insurance Companies Act.
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| • |
“Blocker Company” refers to an entity that owns LLC Interests in Bridge Investment Group LLC prior to the Transactions and is taxable as a corporation for U.S. federal income tax purposes.
|
| • |
“Blocker Shareholder” refers to the owner of the Blocker Company prior to the Transactions, who will exchange its interests in the Blocker Company for shares of our Class A common stock in connection with the consummation of the Transactions
|
| • |
“Bridge GPs” refers to the following entities:
|
| • |
Bridge Office Fund GP LLC (“BOF I GP”)
|
| • |
Bridge Office Fund II GP LLC (“BOF II GP”)
|
| • |
Bridge Seniors Housing & Medical Properties Fund GP LLC (“BSH I GP”)
|
| • |
Bridge Seniors Housing & Medical Properties Fund II GP LLC (“BSH II GP”)
|
| • |
Bridge Seniors Housing Fund III GP LLC (“BSH III GP”)
|
| • |
Bridge Opportunity Zone Fund GP LLC (“BOZ I GP”)
|
| • |
Bridge Opportunity Zone Fund II GP LLC (“BOZ II GP”)
|
| • |
Bridge Opportunity Zone Fund III GP LLC (“BOZ III GP”)
|
| • |
Bridge Opportunity Zone Fund IV GP LLC (“BOZ IV GP”)
|
| • |
Bridge Multifamily Fund III GP LLC (“BMF III GP”)
|
| • |
Bridge Multifamily Fund IV GP LLC (“BMF IV GP”)
|
| • |
Bridge Workforce and Affordable Housing Fund GP LLC (“BWH I GP”)
|
| • |
Bridge Workforce and Affordable Housing Fund II GP LLC (“BWH II GP”)
|
| • |
Bridge Debt Strategies Fund GP LLC (“BDS I GP”)
|
| • |
Bridge Debt Strategies Fund II GP LLC (“BDS II GP”)
|
| • |
Bridge Debt Strategies Fund III GP LLC (“BDS III GP”)
|
| • |
Bridge Debt Strategies Fund IV GP LLC (“BDS IV GP”)
|
| • |
“CAGR” refers to compound annual growth rate.
|
| • |
“Class A Units” refers to the Class A common units of the Operating Company.
|
| • |
“Class B Units” refers to the Class B common units of the Operating Company.
|
| • |
“Continuing Equity Owners” refers collectively to direct or indirect holders of Class A Units and our Class B common stock immediately following consummation of our Initial Public Offering (“IPO”) who may, following the consummation of the IPO, exchange at each of their respective options (subject in certain circumstances to time-based vesting requirements and certain other restrictions), in whole or in part from time to time, their Class A Units (along with an equal number of shares of Class B common stock (and such shares shall be immediately cancelled)) for, at our election (determined solely by our independent directors (within the meaning of the New York Stock Exchange, or NYSE, rules) who are disinterested), cash or newly issued shares of our Class A common stock.
|
| • |
“Fee-earning
AUM” refers to the assets we manage from which we earn management fee revenue.
|
| • |
“LLC Interests” refers to the Class A Units and the Class B Units.
|
| • |
“Operating Company,” “Bridge Investment Group LLC” and “Bridge Investment Group Holdings LLC” refer to Bridge Investment Group Holdings LLC, a Delaware limited liability company, which was converted to a limited liability company organized under the laws of the State of Delaware from a Utah limited liability company formerly named “Bridge Investment Group LLC.”
|
| • |
“Operating Company LLC Agreement” refers to Bridge Investment Group Holdings LLC’s amended and restated limited liability company agreement.
|
| • |
“Operating Subsidiaries” refers to the Bridge GPs and the consolidated entities included in the Operating Company.
|
| • |
“Original Equity Owners” refers to the owners of LLC Interests in the Operating Company, collectively, prior to our IPO.
|
| • |
“Transactions” refers to the organizational transactions and the IPO, and the application of the net proceeds therefrom. See Note 5 to Bridge Investment Group Holdings Inc.’s balance sheets for a description of the Transactions.
|
| • |
The historical performance of our investments may not be indicative of the future results of our investments;
|
| • |
The substantial growth of our business in recent years may be difficult to sustain in the future;
|
| • |
Valuation methodologies for certain assets can be subject to significant subjectivity, and the value of assets may not be the same when realized;
|
| • |
Our revenues are subject to the risks inherent in the ownership and operation of real estate and the construction and development of real estate;
|
| • |
The success of our business depends on the identification and availability of suitable investment opportunities for our funds;
|
| • |
Difficult economic, market and political conditions may adversely affect our businesses;
|
| • |
Our ability to retain our senior leadership team and attract additional qualified investment professionals is critical to our success;
|
| • |
We intend to expand our business and may enter into new investment asset classes, new lines of business and/or new markets;
|
| • |
Defaults by investors in our funds could adversely affect that fund’s operations and performance;
|
| • |
The
COVID-19
pandemic has caused severe disruptions in the U.S. and global economy and may affect the investment returns of our funds;
|
| • |
Fund investors may be unwilling to commit new capital to our funds;
|
| • |
The due diligence process that we undertake in connection with investments may not reveal all facts that may be relevant in connection with an investment;
|
| • |
The investment management business is intensely competitive;
|
| • |
Increased government regulation, compliance failures and changes in law or regulation could adversely affect us and the operation of our funds;
|
| • |
Our principal asset is our interest in the Operating Company, and, as a result, we will depend on distributions from the Operating Company to pay our taxes and expenses and to pay dividends to holders of our Class A common stock;
|
| • |
Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our results of operations and financial condition; and
|
| • |
The Continuing Equity Owners continue to have significant influence over us, including control over decisions that require the approval of stockholders.
|
|
Item 1.
|
Financial Statements (unaudited)
|
|
June 30,
2021 |
April 2,
2021 |
|||||||
|
(unaudited)
|
||||||||
|
Assets
:
|
|
|
|
|
||||
|
Cash and cash equivalents
|
$ | 100 |
|
$
|
100
|
|
||
|
|
|
|
|
|
|
|||
|
Total assets
|
$ | 100 |
|
$
|
100
|
|
||
|
|
|
|
|
|||||
|
Stockholder’s equity
:
|
|
|
|
|
||||
|
Common stock, par value $0.01 per share, 100 shares issued and outstanding
|
$ | 1 |
|
$
|
1
|
|
||
|
Additional
paid-in
capital
|
99 |
|
|
99
|
|
|||
|
|
|
|
|
|
|
|||
|
Total stockholders’ equity
|
$ | 100 |
|
$
|
100
|
|
||
|
|
|
|
|
|||||
|
1.
|
ORGANIZATION
|
|
2.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
|
3.
|
STOCKHOLDERS EQUITY
|
|
4.
|
COMMITMENTS AND CONTINGENCIES
|
|
5.
|
SUBSEQUENT EVENTS
|
|
|
•
|
|
The acquisition of the Blocker Company (the “Blocker Merger”), and issuance to the Blocker Shareholder of 266,809 shares of our Class A common stock as consideration in the Blocker Merger;
|
|
|
•
|
|
The contribution by minority investors that own a portion of the fund manager entities for our Seniors Housing and Office funds of their entire interest in these fund managers to (i) the Operating Company in exchange for 5,835,715 Class A Units, and (ii) the Company in exchange for 143,500
shares of Class A common stock, which the Company further contributed to the Operating Company in exchange
for 143,500 Class A Units;
|
|
|
•
|
|
The contribution by certain of the current owners of the active general partners in our Seniors Housing, Office, Multifamily, Workforce and Affordable Housing, Opportunity Zone and Debt Strategies funds, which include the Continuing Equity Owners, of controlling interests in the Bridge GPs, with the exception of BDS I GP, to (i) the Operating Company, in exchange for 13,166,424 Class A Units, and (ii) the Company in exchange for 395,816 shares of Class A common stock (which includes 1,794 shares of Class A common stock issued to the Blocker Shareholder as consideration in the Blocker Merger), which the Company further contributed to the Operating Company in exchange for 395,816 Class A Units;
|
| • |
The amendment and restatement of the existing limited liability company agreement of the Operating Company to, among other things, (1) convert the Operating Company to a limited liability company organized under the laws of the State of Delaware, (2) change the name of the Operating Company from “Bridge Investment Group LLC” to “Bridge Investment Group Holdings LLC,” (3) convert all existing ownership interests in the Operating Company into 97,321,819 Class A Units and a like amount of Class B Units and (4) appoint the Company as the sole managing member of the Operating Company upon its acquisition of LLC Interests;
|
|
|
•
|
|
The amendment and restatement of the Company’s certificate of incorporation to, among other things, provide for (1) the recapitalization of the Company’s outstanding shares of existing common stock into one share of Class A common stock, (2) the authorization of additional shares of Class A common stock, with each share of Class A common stock entitling its holder to one vote per share on all matters presented to the Company’s stockholders generally and (3) the authorization of shares of Class B common stock, with each share of Class B common stock entitling its holder to ten votes per share on all matters presented to the Company’s stockholders generally, and that shares of Class B common stock may only be held by the Continuing Equity Owners and their respective permitted transferees;
|
|
|
•
|
|
The contribution by the Original Equity Owners of the Class B Units to the Company in exchange for 97,321,819 shares of Class B common stock (which is equal to the number of Class A Units held directly or indirectly by such Continuing Equity Owners immediately following the Transactions);
|
|
|
•
|
|
The contribution by the Former Equity Owners of their indirect ownership of Class A Units to the Company in exchange for 2,180,737 shares of Class A common stock (which includes 265,015 shares of Class A common stock issued to the Blocker Shareholder as consideration in the Blocker Merger) on a
one-to-one
|
|
|
•
|
|
The exchange by the Former Profits Interest Program Participants of their awards for 4,781,623 Class A Units and 282,758 shares of Class A common stock with similar vesting requirements;
|
|
|
•
|
|
The issuance of 18,750,000 shares of Class A common stock to the purchasers in the IPO in exchange for net proceeds of approximately $274.3 million, after taking into account the underwriting discounts and commissions and estimated offering expenses payable by the Company;
|
|
|
•
|
|
The use of the net proceeds from the IPO to purchase 18,750,000 newly issued Class A Units directly from the Operating Company at a price per Class A Unit equal to the initial public offering price per share of Class A common stock in the IPO, less the underwriting discounts and commissions and estimated offering expenses payable by the Company;
|
|
|
•
|
|
The Operating Company used (or plans to use) the net proceeds from the sale of Class A Units to the Company (1) to pay $137.1 million in cash to redeem certain of the Class A Units held directly or indirectly by certain of the Original Equity Owners and (2) for general corporate purposes to support the growth of the business;
|
| • |
The Company entered into (1) a stockholders agreement with certain of the Continuing Equity Owners (including each of our executive officers), (2) a registration rights agreement with certain of the Continuing Equity Owners (including each of our executive officers) and (3) a tax receivable agreement with the Operating Company and the Continuing Equity Owners; and
|
| • |
Subsequently, on August 12, 2021, the underwriters exercised their over-allotment option to purchase an additional 1,416,278 Class A common shares. The Company used 100% of the net proceeds of approximately $21.1 million, after taking into account the underwriting discounts and commissions and estimated offering expenses, to purchase 1,416,278 newly issued Class A Units directly from the Operating Company, at a price per Class A Unit equal to the initial public offering price per share of Class A common stock in the IPO, less the underwriting discounts and commissions and estimated offering expenses payable by the Company. The Operating Company used all of the net proceeds from the sale of Class A Units to the Company related to this over-allotment option to redeem certain of the Class A Units held directly or indirectly by certain of the Original Equity Owners.
|
|
|
|
June 30,
2021 |
|
|
December 31,
2020 |
|
||
|
|
|
(Unaudited)
|
|
|
|
|
||
|
Assets
:
|
||||||||
|
Current assets
:
|
||||||||
|
Cash and cash equivalents
|
$ | 61,548 | $ | 101,830 | ||||
|
Restricted cash
|
5,609 | 5,524 | ||||||
|
Marketable securities
|
5,133 | 5,053 | ||||||
|
Receivables from affiliates
|
22,309 | 25,481 | ||||||
|
Notes receivable from affiliates
|
10,335 | 40,795 | ||||||
|
Notes receivable from employees
|
— | 7,431 | ||||||
|
Prepaid and other current assets
|
5,504 | 5,184 | ||||||
|
|
|
|
|
|||||
|
Total current assets
|
110,438 | 191,298 | ||||||
|
Investments (including accrued performance allocation of $246,620 and $199,410 at June 30, 2021 and December 31, 2020
, respectively)
|
281,671 | 215,427 | ||||||
|
Long-term notes receivable from employees
|
1,739 | — | ||||||
|
Tenant improvements, furniture and equipment
–
Less accumulated depreciation of $3,222 and $2,686 at June 30, 2021 and December 31, 2020
, respectively
|
3,943 | 4,158 | ||||||
|
Intangible assets – Less accumulated
amortization of $11,744 and $10,988
|
4,154 | 4,910 | ||||||
|
Goodwill
|
9,830 | 9,830 | ||||||
|
Other assets
|
195 | 389 | ||||||
|
|
|
|
|
|||||
|
Total assets
|
$
|
411,970
|
|
$
|
426,012
|
|
||
|
|
|
|
|
|||||
|
Liabilities and members’ equity
:
|
||||||||
|
Current liabilities:
|
||||||||
|
Accrued performance allocations compensation
|
$ | 31,136 | $ | 22,167 | ||||
|
Accounts payable and accrued expenses
|
12,438 | 11,137 | ||||||
|
Accrued payroll and benefits
|
20,006 | 11,614 | ||||||
|
General partner notes payable at fair value
|
15,435 | 16,458 | ||||||
|
Insurance loss reserves
|
4,883 | 4,436 | ||||||
|
Self-insurance reserves and unearned premiums
|
3,457 | 3,700 | ||||||
|
Other current liabilities
|
4,699 | 4,830 | ||||||
|
|
|
|
|
|||||
|
Total current liabilities
|
92,054 | 74,342 | ||||||
|
|
|
|
|
|
|
|
|
|
|
Long-term notes
payable, net
|
147,927 | 147,713 | ||||||
|
Other long-term liabilities
|
2,348 | 2,486 | ||||||
|
|
|
|
|
|||||
|
Total liabilities
|
242,329 | 224,541 | ||||||
|
|
|
|
|
|
|
|
|
|
|
Equity:
|
||||||||
|
Net investment in common control group
|
157,253 | 186,091 | ||||||
|
Non-controlling
interest
|
12,377 | 15,376 | ||||||
|
Accumulated other comprehensive income
|
11 | 4 | ||||||
|
|
|
|
|
|||||
|
Total equity
|
169,641 | 201,471 | ||||||
|
|
|
|
|
|||||
|
Total liabilities and members’ equity
|
$
|
411,970
|
|
$
|
426,012
|
|
||
|
|
|
|
|
|||||
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
||||||||||
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
||||
|
Revenues:
|
|
|
|
|
||||||||||||
|
Fund management fees
|
$
|
34,536 |
$
|
25,723 |
$
|
65,387 |
$
|
51,442 | ||||||||
|
Property management and leasing fees
|
14,335 | 14,845 | 31,081 | 31,367 | ||||||||||||
|
Construction management fees
|
2,065 | 2,215 | 3,891 | 3,777 | ||||||||||||
|
Development fees
|
1,163 | 373 | 1,549 | 577 | ||||||||||||
|
Transaction fees
|
16,242 | 8,294 | 21,568 | 15,639 | ||||||||||||
|
Insurance premiums
|
2,022 | 1,349 | 3,916 | 2,505 | ||||||||||||
|
Other asset management and property income
|
1,611 | 2,343 | 3,131 | 3,543 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total revenues
|
|
71,974
|
|
|
55,142
|
|
|
130,523
|
|
|
108,850
|
|
||||
|
Investment income:
|
||||||||||||||||
|
Incentive fees
|
— |
—
|
910 |
—
|
||||||||||||
|
Performance allocations
|
||||||||||||||||
|
Realized gains
|
35,629 | 5,324 | 41,185 | 9,435 | ||||||||||||
|
Unrealized gains (losses)
|
43,248 | (21,435 | ) | 57,967 | (2,618 | ) | ||||||||||
|
Earnings
(losses)
from investments in real estate
|
980 | (178 | ) | 976 | (590 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total investment income
|
|
79,857
|
|
|
(16,289
|
)
|
|
101,038
|
|
|
6,227
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
||||||||||||||||
|
Employee compensation and benefits
|
42,306 | 19,839 | 69,457 | 44,532 | ||||||||||||
|
Incentive fee compensation
|
— |
—
|
82 |
—
|
||||||||||||
|
Performance allocations compensation
|
||||||||||||||||
|
Realized
gains
|
3,747 | 517 | 4,241 | 905 | ||||||||||||
|
Unrealized
gains (losses
)
|
6,048 | (2,424 | ) | 7,477 | (144 | ) | ||||||||||
|
Loss and loss adjustment expenses
|
2,132 | 1,096 | 2,917 | 1,678 | ||||||||||||
|
Third-party operating expenses
|
6,117 | 7,083 | 14,743 | 15,643 | ||||||||||||
|
General and administrative expenses
|
5,392 | 4,070 | 9,492 | 8,761 | ||||||||||||
|
Depreciation and amortization
|
727 | 672 | 1,480 | 1,344 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total expenses
|
|
66,469
|
|
|
30,853
|
|
|
109,889
|
|
|
72,719
|
|
||||
|
Other income (expense)
|
||||||||||||||||
|
Net realized and unrealized gains
|
300 | 152 | 6,097 | 807 | ||||||||||||
|
Interest income
|
557 | 231 | 1,165 | 603 | ||||||||||||
|
Interest expense
|
(2,554 | ) | (444 | ) | (4,140 | ) | (925 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total other income (expense)
|
|
(1,697
|
)
|
|
(61
|
)
|
|
3,122
|
|
|
485
|
|
||||
|
Income before provision for income taxes
|
83,665 | 7,939 | 124,794 | 42,843 | ||||||||||||
|
Income tax provision
|
(424 | ) | (170 | ) | (834 | ) | (182 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net
i
ncome
|
|
83,241
|
|
|
7,769
|
|
|
123,960
|
|
|
42,661
|
|
||||
|
Net income attributable to
non-controlling
interests
|
5,815 | 4,450 | 9,764 | 6,484 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net income attributable to the
Company
|
$
|
77,426
|
|
$
|
3,319
|
|
$
|
114,196
|
|
$
|
36,177
|
|
||||
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
||||||||||
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
||||
|
Net income
|
$
|
83,241
|
|
$
|
7,769
|
|
$
|
123,960
|
|
$
|
42,661
|
|
||||
|
Other comprehensive income - foreign currency translation adjustments
|
6 | — | 7 | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Comprehensive income
|
|
83,247
|
|
|
7,769
|
|
|
123,967
|
|
|
42,661
|
|
||||
|
Less: comprehensive income attributable to non-controlling interests
|
|
5,815
|
|
|
4,450
|
|
|
9,764
|
|
|
6,484
|
|
||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Comprehensive income attributable to the Company
|
$
|
77,432
|
|
$
|
3,319
|
|
$
|
114,203
|
|
$
|
36,177
|
|
||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Net
investment in common control group |
Noncontrolling
interests |
Accumulated
other comprehensive income |
Total | |||||||||||||
|
Balance at March 31, 2021
|
$ | 202,167 | $ | 13,192 | $ | 5 | $ | 215,364 | ||||||||
|
Net income for the period
|
77,426 | 5,815 | — | 83,241 | ||||||||||||
|
Foreign currency translation adjustment
|
— | — | 6 | 6 | ||||||||||||
|
Capital contributions
|
— | 323 | — | 323 | ||||||||||||
|
Return of capital
|
(7 | ) | — | — | (7 | ) | ||||||||||
|
Share-based compensation
|
13,767 | 857 | — | 14,624 | ||||||||||||
|
Distributions to members
|
(136,100 | ) | (7,810 | ) | — | (143,910 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Balance at June 30, 2021
|
$ | 157,253 | $ | 12,377 | $ | 11 | $ | 169,641 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Balance at March 31, 2020
|
$ | 168,489 | $ | 12,990 | $ | — | $ | 181,479 | ||||||||
|
Net income for the period
|
3,319 | 4,450 | — | 7,769 | ||||||||||||
|
Share-based compensation
|
351 | 37 | — | 388 | ||||||||||||
|
Distributions to members
|
(7,438 | ) | (8,780 | ) | — | (16,218 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Balance at June 30, 2020
|
$ | 164,721 | $ | 8,697 | $ | — | $ | 173,418 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Balance at December 31, 2020
|
$ | 186,091 | $ | 15,376 | $ | 4 | $ | 201,471 | ||||||||
|
Net income for the period
|
114,196 | 9,764 | — | 123,960 | ||||||||||||
|
Foreign currency translation adjustment
|
— | — | 7 | 7 | ||||||||||||
|
Capital contributions
|
422 | 323 | — | 745 | ||||||||||||
|
Share-based compensation
|
14,508 | 957 | — | 15,465 | ||||||||||||
|
Repurchase of membership interests
|
(68 | ) | (43 | ) | — | (111 | ) | |||||||||
|
Distributions to members
|
(157,896 | ) | (14,000 | ) | — | (171,896 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Balance at June 30, 2021
|
$ | 157,253 | $ | 12,377 | $ | 11 | $ | 169,641 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Balance at December 31, 2019
|
$ | 174,465 | $ | 15,860 | $ | — | $ | 190,325 | ||||||||
|
Net income for the period
|
36,177 | 6,484 | — | 42,661 | ||||||||||||
|
Capital contributions
|
— | 273 | — | 273 | ||||||||||||
|
Share-based compensation
|
702 | 73 | — | 775 | ||||||||||||
|
Repurchase of membership interests
|
(6,500 | ) | — | — | (6,500 | ) | ||||||||||
|
Distributions to members
|
(40,123 | ) | (13,993 | ) | — | (54,116 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Balance at June 30, 2020
|
$ | 164,721 | $ | 8,697 | $ | — | $ | 173,418 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Six Months Ended June 30
,
|
||||||||
| 2021 | 2020 | |||||||
|
Cash flows from operating activities:
|
||||||||
|
Net income
|
$ | 123,960 | $ | 42,661 | ||||
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
|
Depreciation and amortization
|
1,480 | 1,344 | ||||||
|
Amortization of deferred financing costs and debt discount and premium
|
278 | 56 | ||||||
|
Share-based compensation
|
15,465 | 775 | ||||||
|
Equity in income of investments
|
(5,725 | ) | (285 | ) | ||||
|
Changes in unrealized gain on General Partner Notes Payable
|
(415 | ) | (1,011 | ) | ||||
|
Amortization of lease incentives
|
(135 | ) | (166 | ) | ||||
|
Changes in unrealized performance allocations
|
(57,967 | ) | 2,618 | |||||
|
Changes in operating assets and liabilities:
|
||||||||
|
Receivables
from affiliates
|
3,173 | 14,024 | ||||||
|
Prepaid and other current assets
|
(384 | ) | (4,201 | ) | ||||
|
Other assets
|
15 | (191 | ) | |||||
|
Account payable and accrued expenses
|
1,301 | (2,837 | ) | |||||
|
Accrued payroll and benefits
|
8,392 | 3,135 | ||||||
|
Other current liabilities
|
(131 | ) | 2,011 | |||||
|
Insurance loss reserves
|
447 | 721 | ||||||
|
Self-insurance reserves and unearned premiums
|
(243 | ) | (767 | ) | ||||
|
Accrued performance allocations compensation
|
8,969 | (144 | ) | |||||
|
Deferred Rent
|
(3 | ) | 42 | |||||
|
|
|
|
|
|||||
|
Net cash provided by operating activities
|
98,477 | 57,785 | ||||||
|
|
|
|
|
|||||
|
Cash flows from investing activities:
|
||||||||
|
Purchase of investments
|
(2,717 | ) | (2,408 | ) | ||||
|
Proceeds from sale of investments
|
81 | 918 | ||||||
|
Issuance of notes receivable
|
(146,040 | ) | (135,051 | ) | ||||
|
Proceeds from
epayment of notes receivable
r
|
182,192 | 115,150 | ||||||
|
Purchase of tenant improvements and office equipment
|
(321 | ) | — | |||||
|
|
|
|
|
|||||
|
Net cash provided by (used in) investing activities
|
33,195 | (21,391 | ) | |||||
|
|
|
|
|
|||||
|
Cash flows from financing activities:
|
||||||||
|
Capital contributions
|
745 | 273 | ||||||
|
Distributions to members
|
(157,896 | ) | (40,123 | ) | ||||
|
Distributions to
non-controlling
interest
|
(14,000 | ) | (13,993 | ) | ||||
|
Repurchase of membership interests
|
(111 | ) | (6,500 | ) | ||||
|
Payments of deferred financing costs
|
— | (121 | ) | |||||
|
Repayment of notes payable
|
— | (323 | ) | |||||
|
Repayments of General Partner
N
otes
P
|
(607 | ) | — | |||||
|
Proceeds from line of credit
|
64,800 | 46,151 | ||||||
|
Payments of line of credit
|
(64,800 | ) | (33,085 | ) | ||||
|
|
|
|
|
|||||
|
Net cash used in financing activities
|
(171,869 | ) | (47,721 | ) | ||||
|
|
|
|
|
|
||||
|
Net decrease in cash, cash equivalents, and restricted cash
|
(40,197 | ) | (11,327 | ) | ||||
|
Cash, cash equivalents and restricted cash – beginning of period
|
107,354 | 60,110 | ||||||
|
|
|
|
|
|
||||
|
Cash, cash equivalents and restricted cash – end of period
|
$ | 67,157 | $ | 48,783 | ||||
|
|
|
|
|
|||||
|
Supplemental disclosure of cash flow information:
|
||||||||
|
Cash paid for income taxes
|
$ | 834 | $ | 182 | ||||
|
Cash paid for interest
|
3,019 | 54 | ||||||
|
Cash and cash equivalents
|
$ | 61,548 | $ | 44,721 | ||||
|
Restricted cash
|
5,609 | 4,062 | ||||||
|
|
|
|
|
|
||||
|
Cash, cash equivalents, and restricted cash
|
$ | 67,157 | $ | 48,783 | ||||
|
|
|
|
|
|||||
|
1.
|
ORGANIZATION
|
|
2.
|
SIGNIFICANT ACCOUNTING POLICIES
|
| • |
Level 1 — Pricing inputs are unadjusted, quoted prices in active markets for identical assets or liabilities as of the measurement date.
|
| • |
Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in inactive markets; and model-derived valuations with directly or indirectly observable significant inputs. Level 2 inputs include prices in markets with few transactions,
non-current
prices, prices for which little public information exists or prices that vary substantially over time or among brokered market makers. Level 2 inputs include interest rates, yield curves, volatilities, prepayment risks, loss severities, credit risks and default rates.
|
| • |
Level 3 — Valuations that rely on one or more significant unobservable inputs. These inputs reflect the Company’s assessment of the assumptions that market participants would use to value the instrument based on the best information available.
|
|
3.
|
REVENUE
|
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
||||||||||
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
||||
|
Funds
|
$ | 33,510 | $ | 23,982 | $ | 62,980 | $ | 48,639 | ||||||||
|
Joint Ventures and Separately Managed Accounts
|
1,026 | 1,741 | 2,407 | 2,803 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total Fund Management Fees
|
$ | 34,536 | $ | 25,723 | $ | 65,387 | $ | 51,442 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
||||||||||
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
||||
|
Seniors Housing
|
$ | 6,597 | $ | 6,867 | $ | 13,153 | $ | 14,151 | ||||||||
|
Multifamily
|
4,322 | 3,659 | 8,416 | 7,388 | ||||||||||||
|
Office
|
3,416 | 4,319 | 9,512 | 9,828 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total Property Management and Leasing Fees
|
$ | 14,335 | $ | 14,845 | $ | 31,081 | $ | 31,367 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
||||||||||
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
||||
|
Multifamily
|
$ | 1,133 | $ | 996 | $ | 2,058 | $ | 1,995 | ||||||||
|
Office
|
829 | 1,007 | 1,578 | 1,501 | ||||||||||||
|
Seniors Housing
|
103 | 212 | 255 | 281 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total Construction Management Fees
|
$ | 2,065 | $ | 2,215 | $ | 3,891 | $ | 3,777 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
||||||||||
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
||||
|
Acquisition Fees
|
$ | 13,137 | $ | 6,647 | $ | 17,789 | $ | 12,084 | ||||||||
|
Brokerage Fees
|
3,105 | 1,647 | 3,779 | 3,555 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total Transactional Fees
|
$ | 16,242 | $ | 8,294 | $ | 21,568 | $ | 15,639 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
4.
|
MARKETABLE SECURITIES
|
|
|
|
Cost
|
|
|
Unrealized Gains
|
|
|
Unrealized Losses
|
|
|
Fair Value
|
|
||||
|
June 30, 2021
|
|
|
|
|
||||||||||||
|
Exchange Traded Funds
|
$ | 715 | $ | 21 | $ | — | $ | 736 | ||||||||
|
Mutual Funds
|
4,353 | 60 | (16 | ) | 4,397 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total
|
$
|
5,068
|
|
$
|
81
|
|
$
|
(16
|
)
|
$
|
5,133
|
|
||||
|
|
|
|
|
|
|
|
|
|||||||||
|
June 30, 2020
|
||||||||||||||||
|
Exchange Traded Funds
|
$ | 713 | $ | 23 | $ | — | $ | 736 | ||||||||
|
Mutual Funds
|
4,301 | 16 | — | 4,317 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total
|
$
|
5,014
|
|
$
|
39
|
|
$
|
—
|
|
$
|
5,053
|
|
||||
|
|
|
|
|
|
|
|
|
|||||||||
|
5.
|
INVESTMENTS
|
| Carrying Value at | ||||||||
|
Investments
|
June 30,
2021 |
December 31,
2020 |
||||||
|
Partnership interest in carried interest
(1)
|
$ | 246,620 | $ | 199,410 | ||||
|
Partnership interest in the funds
(2)
|
29,629 | 12,975 | ||||||
|
Investments in third party partnership
(3)
|
5,081 | 2,697 | ||||||
|
Other investments
(4)
|
341 | 345 | ||||||
|
|
|
|
|
|||||
|
Total
|
$
|
281,671
|
|
$
|
215,427
|
|
||
|
|
|
|
|
|||||
|
|
(1)
|
Represents an investment in carried interest in the funds. There is a disproportionate allocation of returns to the Company as general partner or equivalent based on the extent to which cumulative performance of the fund exceeds minimum return hurdles. Investment is valued using NAV of the respective vehicle.
|
|
|
(2)
|
Investments in the funds and limited partnership interest are valued using NAV of the respective vehicle.
|
|
|
(3)
|
Investments in limited partnership interest in third party private proptech venture capital firms. Valued using NAV of the respective vehicle.
|
|
|
(4)
|
Investments are accounted for using the measurement alternative to measure at cost adjusted for any impairment and observable price changes.
|
|
|
|
Three Months Ended
|
|
|||||
|
|
|
June 30, 2021
|
|
|
June 30, 2020
|
|
||
|
Investment income
|
|
|
||||||
|
Net earnings from investments in real estate
|
$ | 6,851 | $ | 686 | ||||
|
Interest and other income
|
8 | 28 | ||||||
|
Total investment income
|
6,859 | 714 | ||||||
|
Expenses
|
||||||||
|
|
|
|
|
|||||
|
Management fees
|
1,563
|
|
2,222
|
|
||||
|
|
|
|
|
|||||
|
Partnership expense
|
284
|
463
|
||||||
|
Interest expense
|
6
|
18
|
||||||
|
Total expenses
|
1,853 | 2,703 | ||||||
|
Net investment income (loss)
|
5,006 | (1,989 | ) | |||||
|
Net realized gain (loss) on investments in real estate
|
105,682 | 3,198 | ||||||
|
Changes in unrealized gain on investments in real estate
|
(45,923 | ) | 29,397 | |||||
|
|
|
|
|
|||||
|
Unrealized gain on interest rate swap
|
1,319 | 1,228 | ||||||
|
Net gain on investments
|
61,078 | 33,823 | ||||||
|
|
|
|
|
|||||
|
Net increase in partners’ capital resulting from operations
|
$
|
66,084
|
|
$
|
31,834
|
|
||
|
|
|
|
|
|||||
|
|
|
Six Months Ended
|
|
|||||
|
|
|
June 30, 2021
|
|
|
June 30, 2020
|
|
||
|
Investment income
|
|
|
||||||
|
Net earnings from investments in real estate
|
|
$
|
13,562
|
|
|
$
|
7,020
|
|
|
Interest and other income
|
|
|
12
|
|
|
|
115
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investment income
|
|
|
13,574
|
|
|
|
7,135
|
|
|
Expenses
|
|
|
||||||
|
Management fees
|
|
|
3,300
|
|
|
|
4,515
|
|
|
Partnership expense
|
|
|
628
|
|
|
|
996
|
|
|
Interest expense
|
|
|
25
|
|
|
|
57
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
|
3,953
|
|
|
|
5,568
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
9,621
|
|
|
|
1,567
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized gain on investments in real estate
|
|
|
119,115
|
|
|
|
35,238
|
|
|
Changes in unrealized gain on investments in real estate
|
|
|
21,742
|
|
|
|
20,829
|
|
|
Unrealized gain (loss) on interest rate swap
|
|
|
2,929
|
|
|
|
(3,556
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net gain on investments
|
|
|
143,786
|
|
|
|
52,511
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in partners’ capital resulting from operations
|
|
$
|
153,407
|
|
|
$
|
54,078
|
|
|
|
|
|
|
|
|
|
|
|
|
6.
|
NOTES RECEIVABLE FROM AFFILIATES
|
|
June 30,
2021 |
December 31,
2020 |
|||||||
|
Bridge Office Fund II
|
$ | — | $ | 25,770 | ||||
|
Bridge Debt Strategies Fund I
|
5,335 | 4,500 | ||||||
|
Bridge Seniors Housing Fund I
|
— | 5,000 | ||||||
|
Bridge Seniors Housing Fund II
|
— | 5,000 | ||||||
|
Bridge Seniors Housing Fund III
|
— | 525 | ||||||
|
Bridge Multifamily Fund V
|
4,000 | — | ||||||
|
Bridge Logistics Net Leasing Fund I
|
1,000 | — | ||||||
|
|
|
|
|
|||||
|
Total
|
$ | 10,335 | $ | 40,795 | ||||
|
|
|
|
|
|||||
|
7.
|
NOTES RECEIVABLE FROM EMPLOYEES
|
|
8.
|
FAIR VALUE MEASUREMENTS
|
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Measured at
NAV |
|
|
Total
|
|
|||||
|
June 30, 2021
|
|
|
|
|
|
|||||||||||||||
|
Assets:
|
|
|
|
|
|
|||||||||||||||
|
Exchange Traded Funds
|
$ | 736 | $ | — | $ | — | $ | — | $ | 736 | ||||||||||
|
Mutual Funds
|
4,397 | — | — | — | 4,397 | |||||||||||||||
|
Carried Interest
|
— | — | — | 246,620 | 246,620 | |||||||||||||||
|
Partnership Interests
|
— | — | — | 34,710 | 34,710 | |||||||||||||||
|
Other Investments
|
— | — | 341 | — | 341 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Total Assets
|
$ | 5,133 | $ | — | $ | 341 | $ | 281,330 | $ | 286,804 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Liabilities:
|
||||||||||||||||||||
|
Fair value option:
|
||||||||||||||||||||
|
General partner notes payable
|
$
|
— |
$
|
— |
$
|
— |
$
|
15,435 |
$
|
15,435 | ||||||||||
|
December 31, 2020
|
|
|
|
|
|
|||||||||||||||
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Measured at
NAV |
|
|
Total
|
|
|||||
|
Assets:
|
|
|
|
|
|
|||||||||||||||
|
Exchange Traded Funds
|
$ | 736 | $ | — | $ | — | $ | — | $ | 736 | ||||||||||
|
Mutual Funds
|
4,317 | — | — | — | 4,317 | |||||||||||||||
|
Carried Interest
|
— | — | — | 199,410 | 199,410 | |||||||||||||||
|
Partnership Interests
|
— | — | — | 15,672 | 15,672 | |||||||||||||||
|
Other Investments
|
— | — | 345 | — | 345 | |||||||||||||||
|
Total Assets
|
|
$
|
5,053
|
|
|
$
|
—
|
|
|
$
|
345
|
|
|
$
|
215,082
|
|
|
$
|
220,480
|
|
|
Liabilities:
|
||||||||||||||||||||
|
Fair value option:
|
||||||||||||||||||||
|
General partner notes payable
|
$
|
— |
$
|
— |
$
|
— |
$
|
16,458 |
$
|
16,458 | ||||||||||
|
Fair Value
|
Unfunded
Commitments |
|||||||
|
June 30, 2021:
|
||||||||
|
Carried Interest
|
$ | 246,620 | $ | — | ||||
|
Company-sponsored
open-end
fund
|
13,861 | — | ||||||
|
Company-sponsored
closed-end
funds
|
15,768 | 58 | ||||||
|
Third party
closed-end
funds
|
5,081 | 3,629 | ||||||
|
|
|
|
|
|||||
|
Total
|
$
|
281,330
|
|
$
|
3,687
|
|
||
|
|
|
|
|
|||||
|
December 31, 2020:
|
||||||||
|
Carried Interest
|
$ | 199,410 | $ | — | ||||
|
Company-sponsored
open-end
fund
|
12,643 | — | ||||||
|
Company-sponsored
closed-end
funds
|
332 | 58 | ||||||
|
Third party
closed-end
funds
|
2,697 | 4,802 | ||||||
|
|
|
|
|
|||||
|
Total
|
$
|
215,082
|
|
$
|
4,860
|
|
||
|
|
|
|
|
|||||
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
|
Carrying Value
|
|
|||||
|
June 30, 2021:
|
|
|
|
|
|
|||||||||||||||
|
Line of credit
|
$ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||
|
Private Notes
|
— | — | 146,270 | 146,270 | 150,000 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | — | $ | — | $ | 146,270 | $ | 146,270 | $ | 150,000 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
December 31, 2020:
|
||||||||||||||||||||
|
Line of credit
|
$ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||
|
Private Notes
|
— | — | 149,225 | 149,225 | 150,000 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | — | $ | — | $ | 149,225 | $ | 149,225 | $ | 150,000 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
9
.
|
TENANT IMPROVEMENTS, FURNITURE AND EQUIPMENT
|
|
June 30,
2021 |
December 31,
2020 |
|||||||
|
Tenant improvements
|
|
$ | 4,217 | $ | 3,893 | |||
|
Office furniture
|
|
1,602 | 1,602 | |||||
|
Office equipment
|
|
211 | 211 | |||||
|
Computer equipment
|
|
1,135 | 1,138 | |||||
|
Total tenant improvements, furniture and equipment
|
|
|
7,165
|
|
|
|
6,844
|
|
|
Accumulated depreciation
|
(3,222 | ) | (2,686 | ) | ||||
|
|
|
|
|
|||||
|
Net tenant improvements, furniture and equipment
|
$ | 3,943 | $ | 4,158 | ||||
|
|
|
|
|
|||||
|
1
0
.
|
INTANGIBLE ASSETS
|
|
|
|
Weighted
Average Life |
|
|
Gross
Carrying Amount |
|
|
Accumulated
Amortization |
|
|
Net Carrying
Amount |
|
||||
|
June 30, 2021:
|
|
|
|
|||||||||||||
|
Customer Lists
|
10 yrs |
$
|
6,835 |
$
|
(6,835 | ) | $ |
—
|
||||||||
|
Management Contracts
|
6 yrs | 9,063 | (4,909 | ) | 4,154 |
|
||||||||||
|
|
|
|||||||||||||||
|
Total
|
$
|
4,154
|
|
|||||||||||||
|
|
|
|||||||||||||||
|
December 31, 2020:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer Lists
|
10 yrs | 6,835 | (6,781 | ) | $ | 54 | ||||||||||
|
Management Contracts
|
6 yrs | 9,063 | (4,207 | ) | 4,856 | |||||||||||
|
|
|
|||||||||||||||
|
Total
|
$
|
4,910
|
|
|||||||||||||
|
|
|
|||||||||||||||
|
11.
|
LOSS AND LOSS ADJUSTMENT LIABILITY AND EXPENSES
|
| • |
Lease Security Deposit Fulfillment (limits $500 per occurrence/per property unit)
|
| • |
Lessor Legal Liability (limits $100,000 per occurrence/per property unit)
|
| • |
Workers’ Compensation Deductible Reimbursement (limits $3,739,680)
|
| • |
Property Deductible Reimbursement ($750,000 per occurrence/$5,000,000 policy annual aggregate)
|
| • |
General Liability Deductible Reimbursement ($2,000,000 in excess of $25,000 per occurrence; $4,000,000 per location aggregate; $10,000,000 policy aggregate)
|
|
1
2
.
|
SELF-INSURANCE RESERVES
|
|
1
3
.
|
GENERAL PARTNER NOTES PAYABLE
|
|
|
|
Commitment
|
|
|
Fair Value as of
June 30, 2021 |
|
|
Fair Value as of
December 31, 2020 |
|
|||
|
Bridge Seniors Housing Fund I
|
$ | 4,775 | $ | 5,269 | $ | 5,243 | ||||||
|
Bridge Multifamily Fund III
|
9,300 | 7,612 | 8,643 | |||||||||
|
Bridge Debt Strategies Fund I
|
7,260 | 2,554 | 2,572 | |||||||||
|
|
|
|
|
|
|
|||||||
|
Total
|
$ | 21,335 | $ | 15,435 | $ | 16,458 | ||||||
|
|
|
|
|
|
|
|||||||
|
1
4
.
|
LINE OF CREDIT
|
|
1
5
.
|
NOTES PAYABLE
|
|
2021
|
$ | — | ||
|
2022
|
— | |||
|
2023
|
— | |||
|
2024
|
— | |||
|
2025
|
75,000 | |||
|
Thereafter
|
75,000 | |||
|
|
|
|||
|
Total
|
$ | 150,000 |
|
|
|
Private
Notes |
|
|
Line of
credit and term loan |
|
||
|
Unamortized debt issuance costs as of December 31, 2020
|
$
|
2,257 |
$
|
170 | ||||
|
|
|
|
|
|||||
|
Amortization of debt issuance costs
|
(214 | ) | (47 | ) | ||||
|
|
|
|
|
|||||
|
Unamortized debt issuance costs as of June 30, 2021
|
$ | 2,043 | $ | 123 | ||||
|
|
|
|
|
|||||
|
16.
|
REALIZED AND UNREALIZED GAINS (LOSSES)
|
|
|
|
For the Three Months Ended June 30, 2021
|
|
|
For the Three Months Ended June 30, 2020
|
|
||||||||||||||||||
|
|
|
Net Realized
Gains (Losses) |
|
|
Net Unrealized
Gains (Losses) |
|
|
Total
|
|
|
Net Realized
Gains (Losses) |
|
|
Net Unrealized
Gains (Losses) |
|
|
Total
|
|
||||||
|
Investment in Company-sponsored funds
|
$ | (5 | ) | $ | 411 | $ | 406 | $ | — | $ | — | $ | — | |||||||||||
|
Investment in third party partnerships
|
(270 | ) | 1,279 | 1,009 | — | — | — | |||||||||||||||||
|
Other investments
|
(17 | ) | 26 | 9 | 224 | — | 224 | |||||||||||||||||
|
General Partner Notes Payable
|
|
|
—
|
|
|
|
(1,124
|
)
|
|
|
(1,124
|
)
|
|
|
—
|
|
|
|
(72
|
) |
|
|
(72
|
) |
|
Total
|
$ | (292 | ) | $ | 592 | $ | 300 | $ | 224 | $ | (72 | ) | $ | 152 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
|
For the Six Months Ended June 30, 2021
|
|
|
For the Six Months Ended June 30, 2020
|
|
||||||||||||||||||
|
|
|
Net Realized
Gains (Losses) |
|
|
Net Unrealized
Gains (Losses) |
|
|
Total
|
|
|
Net Realized
Gains (Losses) |
|
|
Net Unrealized
Gains (Losses) |
|
|
Total
|
|
||||||
|
Investment in Company-sponsored funds
|
$ | (4 | ) | $ | 4,452 | $ | 4,448 | $ | — |
$
|
$ | — | ||||||||||||
|
Investment in third party partnerships
|
(312 | ) | 1,523 | 1,211 | (36 | ) | 167 | 131 | ||||||||||||||||
|
Other investments
|
— | 22 | 22 | (152 | ) | (152 | ) | |||||||||||||||||
|
General Partner Notes Payable
|
|
|
—
|
|
|
|
416
|
|
|
|
416
|
|
|
|
—
|
|
|
|
828
|
|
|
|
828
|
|
|
Total
|
$ | (316 | ) | $ | 6,413 | $ | 6,097 | $ | (188 | ) | $ | 995 | $ | 807 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
17.
|
INCOME TAXES
|
|
18.
|
NET INVESTMENT IN THE COMMON CONTROL GROUP
|
|
19
.
|
COMMITMENTS AND CONTINGENCIES
|
|
For the Years Ended
December 31, |
||||
|
Remainder of 2021
|
$ | 2,085 | ||
|
2022
|
3,825 | |||
|
2023
|
3,621 | |||
|
2024
|
3,345 | |||
|
2025
|
3,163 | |||
|
Thereafter
|
5,485 | |||
|
|
|
|||
|
Total
|
$ | 21,524 | ||
|
|
|
|||
|
20.
|
VARIABLE INTEREST ENTITIES
|
|
2
1
.
|
RELATED PARTY TRANSACTIONS
|
|
June 30,
2021 |
December 31,
2020 |
|||||||
|
Fees receivable
from non-consolidated funds
|
$ | 16,714 | $ | 15,350 | ||||
|
Payments made on behalf of and amounts due from
non-consolidated
funds
|
5,595 | 10,131 | ||||||
|
|
|
|
|
|||||
|
Total receivables from affiliates
|
$ | 22,309 | $ | 25,481 | ||||
|
2
2
.
|
PROFITS INTERESTS
|
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
|
Antidilutive
a
wards
|
$ | 13,609 |
$
|
— | $ | 13,609 |
$
|
— | ||||||||
|
Awards shares
|
1,015 | 388 | 1,856 | 775 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total
|
|
$
|
14,624
|
|
$
|
388
|
|
$
|
15,465
|
|
$
|
775
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
For the Years Ended
December 31, |
|
|
|
Remainder of 2021
|
|
$
|
2,526
|
|
|
2022
|
|
|
3,783
|
|
|
2023
|
|
|
3,147
|
|
|
2024
|
|
|
2,232
|
|
|
2025
|
|
|
996
|
|
|
Thereafter
|
|
|
331
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
13,015
|
|
|
|
|
|
|
|
|
23.
|
EMPLOYEE BENEFIT PLAN
|
|
2
4
.
|
SUBSEQUENT EVENTS
|
|
Entity (in thousands)
|
Controlling
Interest |
Non-
Controlling
Interest |
Total
Distributions |
|||||||||
|
Bridge Investment Group LLC
|
$ |
11,390
|
$ | — | $ |
11,390
|
||||||
|
Bridge Debt Strategies Fund Manager LLC
|
332
|
222
|
554
|
|||||||||
|
Bridge Senior Housing Fund Manager LLC
|
1,103 | 736 | 1,839 | |||||||||
|
Bridge Office Fund Manager LLC
|
1,027
|
328
|
1,355
|
|||||||||
|
|
|
|
|
|
|
|||||||
|
Total
|
$ | 13,852 | $ | 1,286 | $ | 15,138 | ||||||
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
| • |
The extent to which fund investors favor private markets investments
(4) de-leveraging
of the global banking system, bank consolidation and increased regulatory requirements and (5) increasing barriers to entry and growth.
|
| • |
Our ability to generate strong, stable returns and retain investor capital throughout the market cycle.
|
| • |
Our ability to source investments with attractive risk-adjusted returns
value-add
strategies with respect to such investments, is dependent on a number of factors, including the general macroeconomic environment, market positioning, valuation, size, and the liquidity of such investment opportunities. Moreover, with respect to our Debt Strategies and Agency MBS Funds, macro-economic trends or adverse credit and interest rate environments affecting the quality or quantity of new issuance debt and mortgage-backed securities or a substantial increase in defaults could adversely affect our ability to source investments with attractive risk-adjusted returns. Furthermore, fluctuations in prevailing interest rates could affect not only our returns on debt and mortgage-backed securities, but also our cost of, and ability to secure, borrowings to finance our equity asset acquisitions.
|
| • |
The attractiveness of our product offerings to a broad and evolving investor base
|
| • |
Our ability to maintain our data advantage relative to competitors
|
|
Three Months
Ended |
Six Months
Ended |
|||||||
|
($ in millions)
|
June 30, 2021 | June 30, 2021 | ||||||
|
Balance as of beginning of period
|
$ | 25,927 | $ | 25,214 | ||||
|
New capital / commitments raised
(1)
|
1,057 | 1,235 | ||||||
|
Liquidations / distributions
(2)
|
(320 | ) | (582 | ) | ||||
|
Market activity and other
(3)
|
2,085 | 2,882 | ||||||
|
|
|
|
|
|||||
|
Balance as of end of period
|
$ | 28,749 | $ | 28,749 | ||||
|
|
|
|
|
|||||
| (1) |
New capital / commitments raised generally represents limited partner capital raised by our funds and other vehicles, including any reinvestments in our open-ended vehicles.
|
| (2) |
Liquidations / distributions generally represents the realization proceeds from the disposition of assets, current income, or capital returned to investors.
|
| (3) |
Market activity and other generally represents realized and unrealized activity on investments held by our funds and other vehicles (including changes in fair value and changes in leverage) as well as the net impact of fees, expenses, and non-investment income.
|
|
Three Months
Ended |
Six Months
Ended |
|||||||
|
($ in millions)
|
June 30, 2021 | June 30, 2021 | ||||||
|
Balance as of beginning of period
|
$ | 10,314 | $ | 10,214 | ||||
|
Increases
(1)
|
1,052 | 1,432 | ||||||
|
Changes in fair market value
|
(10 | ) | (11 | ) | ||||
|
Decreases
(2)
|
(536 | ) | (816 | ) | ||||
|
|
|
|
|
|||||
|
Balance as of end of period
|
$ | 10,819 | $ | 10,819 | ||||
|
|
|
|
|
|||||
|
Increase
|
505 | 605 | ||||||
|
Increase %
|
4.9 | % | 5.9 | % | ||||
| (1) |
Increases generally represents limited partner capital raised or deployed by our funds and other vehicles that is fee-earning when raised or deployed, respectively, including any reinvestments in our open-ended vehicles.
|
| (2) |
Decreases generally represents liquidations of investments held by our funds or other vehicles or other changes in fee basis, including the change from committed capital to invested capital after the expiration or termination of the investment period.
|
| June 30, | December 31, | |||||||||||||||
| 2021 | 2020 | 2020 | 2019 | |||||||||||||
|
Fee-Earning
AUM by Fund
|
||||||||||||||||
|
Bridge Multifamily Fund III
|
$ | 335 | $ | 494 | $ | 401 | $ | 527 | ||||||||
|
Bridge Multifamily III JV Partners
|
10 | 10 | 10 | 13 | ||||||||||||
|
Bridge Multifamily Fund IV
|
1,259 | 1,574 | 1,574 | 1,579 | ||||||||||||
|
Bridge Workforce Fund I
|
523 | 424 | 499 | 608 | ||||||||||||
|
Bridge Workforce Fund II
|
616 | 72 | 166 | — | ||||||||||||
|
Bridge Opportunity Zone Fund I
|
482 | 482 | 482 | 466 | ||||||||||||
|
Bridge Opportunity Zone Fund II
|
408 | 408 | 408 | 414 | ||||||||||||
|
Bridge Opportunity Zone Fund III
|
1,019 | 331 | 1,028 | — | ||||||||||||
|
Bridge Opportunity Zone Fund IV
|
544 | — | — | — | ||||||||||||
|
Bridge Office Fund I
|
500 | 503 | 500 | 548 | ||||||||||||
|
Bridge Office I JV Partners
|
148 | 154 | 154 | 154 | ||||||||||||
|
Bridge Office Fund II
|
130 | 89 | 89 | 81 | ||||||||||||
|
Bridge Office II JV Partners
|
6 | 21 | 21 | 7 | ||||||||||||
|
Bridge Seniors Housing Fund I
|
626 | 626 | 626 | 626 | ||||||||||||
|
Bridge Seniors Housing Fund II
|
814 | 789 | 769 | 937 | ||||||||||||
|
Bridge Seniors Housing Fund III
|
33 | — | 33 | — | ||||||||||||
|
Bridge Debt Strategies Fund I
|
40 | 48 | 41 | 48 | ||||||||||||
|
Bridge Debt Strategies I JV Partners
|
18 | 18 | 18 | 18 | ||||||||||||
|
Bridge Debt Strategies Fund II
|
545 | 849 | 678 | 933 | ||||||||||||
|
Bridge Debt Strategies II JV Partners
|
225 | 389 | 343 | 408 | ||||||||||||
|
Bridge Debt Strategies Fund III
|
1,485 | 1,511 | 1,549 | 1,279 | ||||||||||||
|
Bridge Debt Strategies III JV Partners
|
329 | 465 | 416 | 81 | ||||||||||||
|
Bridge Debt Strategies Fund IV
|
606 | — | 305 | — | ||||||||||||
|
Bridge Agency MBS Fund
|
118 | 64 | 104 | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total
Fee-Earning
AUM by Fund
|
$ | 10,819 | $ | 9,321 | $ | 10,214 | $ | 8,727 | ||||||||
|
|
|
|
|
|
|
|
|
|
Performance Summary as of June 30, 2021
|
||||||||||||||||||||
|
(in millions)
|
Fund
Committed Capital
(2)
|
Unreturned
Drawn Capital + Accrued Pref
(3)
|
Cumulative
Invested Capital
(4)
|
Realized
Proceeds
(5)
|
Remaining
Fair Value (RFV)
(6)
|
|||||||||||||||
|
Closed-End
Funds by Platform
(1)
|
||||||||||||||||||||
|
(Investment Period Beginning/Ending Date)
|
||||||||||||||||||||
|
Bridge Multifamily Fund I
(Mar 2009, Mar 2012) |
$ | 124 | $ | — | $ | 150 | $ | 280 | $ | — | ||||||||||
|
Bridge Multifamily Fund II
(Apr 2012, Mar 2015) |
596 | — | 605 | 1,264 | — | |||||||||||||||
|
Bridge Multifamily Fund III
(Jan 2015, Jan 2018) |
912 | 2 | 870 | 1,205 | 706 | |||||||||||||||
|
Bridge Multifamily Fund IV
(Jun 2018, Jun 2021) |
1,590 | 1,402 | 1,101 | 126 | 1,645 | |||||||||||||||
|
Bridge Workforce & Affordable Housing Fund I
(Aug 2017, Aug 2020) |
619 | 594 | 525 | 63 | 841 | |||||||||||||||
|
Bridge Office Fund I
(Jul 2017, Jul 2020) |
573 | 600 | 521 | 94 | 599 | |||||||||||||||
|
Bridge Seniors Housing Fund I
(Jan 2014, Jan 2018) |
578 | 739 | 619 | 245 | 624 | |||||||||||||||
|
Bridge Seniors Housing Fund II
(Mar 2017, Mar 2020) |
820 | 804 | 702 | 136 | 748 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Total Equity Strategies
Closed-End
Funds
|
5,812 | 4,142 | 5,095 | 3,412 | 5,163 | |||||||||||||||
|
Bridge Debt Strategies Fund I
(Sep 2014, Sep 2017) |
132 | 50 | 219 | 215 | 49 | |||||||||||||||
|
Bridge Debt Strategies Fund II
(July 2016, July 2019) |
1,002 | 604 | 2,137 | 1,962 | 590 | |||||||||||||||
|
Bridge Debt Strategies Fund III
(May 2018, May 2021) |
1,624 | 1,520 | 1,835 | 891 | 1,389 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Total Debt Strategies
Closed-End
Funds
|
2,757 | 2,174 | 4,191 | 3,068 | 2,029 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Total
Closed-End
Funds
|
$ | 8,569 | $ | 6,316 | $ | 9,287 | $ | 6,480 | $ | 7,191 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Performance Summary as of June 30, 2021 continued | ||||||||||||||||||||
|
(in millions)
|
Unrealized
MOIC
(7)
|
Total
Fair Value (TFV)
(8)
|
TFV
MOIC
(9)
|
Fund
Gross IRR
(10)
|
Fund
Net IRR
(11)
|
|||||||||||||||
|
Closed-End
Funds by Platform
(1)
|
||||||||||||||||||||
|
(Investment Period Beginning/Ending Date)
|
||||||||||||||||||||
|
Bridge Multifamily Fund I
(Mar 2009, Mar 2012) |
NA | $ | 280 | 1.87x | 21.0 | % | 15.3 | % | ||||||||||||
|
Bridge Multifamily Fund II
(Apr 2012, Mar 2015) |
NA | 1,264 | 2.09x | 30.2 | % | 23.4 | % | |||||||||||||
|
Bridge Multifamily Fund III
(Jan 2015, Jan 2018) |
2.47x | 1,911 | 2.20x | 26.6 | % | 20.0 | % | |||||||||||||
|
Bridge Multifamily Fund IV
(Jun 2018, Jun 2021) |
1.61x | 1,771 | 1.61x | 36.5 | % | 26.3 | % | |||||||||||||
|
Bridge Workforce & Affordable Housing Fund I
(Aug 2017, Aug 2020) |
1.72x | 904 | 1.72x | 33.8 | % | 25.8 | % | |||||||||||||
|
Bridge Office Fund I
(Jul 2017, Jul 2020) |
1.33x | 693 | 1.33x | 11.9 | % | 8.4 | % | |||||||||||||
|
Bridge Seniors Housing Fund I
(Jan 2014, Jan 2018) |
1.41x | 868 | 1.40x | 8.0 | % | 5.3 | % | |||||||||||||
|
Bridge Seniors Housing Fund II
(Mar 2017, Mar 2020) |
1.25x | 884 | 1.26x | 10.1 | % | 6.4 | % | |||||||||||||
|
|
|
|||||||||||||||||||
|
Total Equity Strategies
Closed-End
Funds
|
1.57x | 8,575 | 1.68x | 22.5 | % | 16.3 | % | |||||||||||||
|
Bridge Debt Strategies Fund I
(Sep 2014, Sep 2017) |
1.03x | 264 | 1.21x | 8.8 | % | 6.7 | % | |||||||||||||
|
Bridge Debt Strategies Fund II
(July 2016, July 2019) |
1.27x | 2,552 | 1.19x | 11.4 | % | 9.1 | % | |||||||||||||
|
Bridge Debt Strategies Fund III
(May 2018, May 2021) |
1.27x | 2,280 | 1.24x | 14.2 | % | 10.9 | % | |||||||||||||
|
|
|
|||||||||||||||||||
|
Total Debt Strategies
Closed-End
Funds
|
1.26x | 5,096 | 1.22x | 12.3 | % | 9.6 | % | |||||||||||||
|
|
|
|||||||||||||||||||
|
Total
Closed-End
Funds
|
1.45x | $ | 13,671 | 1.47x | 19.8 | % | 14.4 | % | ||||||||||||
|
|
|
|||||||||||||||||||
|
(1)
|
Does not include performance for (i) Opportunity Zone funds, as such funds are invested in active development projects and have minimal stabilized assets, or (ii) funds that are currently raising capital, including our open-ended funds.
|
|
(2)
|
Fund Committed Capital represents total capital commitments to the fund, excluding joint ventures or separately managed accounts.
|
|
(3)
|
Unreturned Drawn Capital and Accrued Pref represents the amount the fund needs to distribute to its investors as a return of capital and a preferred return before it is entitled to receive performance fees or allocations from the fund.
|
|
(4)
|
Cumulative Invested Capital represents the total cost of investments since inception (including any recycling or refinancing of investments).
|
|
(5)
|
Realized Proceeds represents net cash proceeds received in connection with all investments, including distributions from investments and disposition proceeds.
|
|
(6)
|
Remaining Fair Value (“RFV”) is the estimated liquidation values of remaining fund investments that are generally based upon appraisals, contracts and internal estimates. There can be no assurance that Remaining Fair Value will be realized at valuations shown, and realized values will depend on numerous factors including, among others, future asset-level operating results, asset values and market conditions at the time of disposition, transaction costs, and the timing and manner of disposition, all of which may differ from the assumptions on which the Remaining Fair Value are based. Direct fund investments in real property are held at cost minus transaction expenses for the first six months from investment.
|
|
(7)
|
Unrealized MOIC represents the Multiple of Invested Capital (“MOIC”) for RFV before management fees, expenses and carried interest, divided by the remaining invested capital attributable to those unrealized investments.
|
|
(8)
|
Total Fair Value (“TFV”) represents the sum of Realized Proceeds and Remaining Fair Value, before management fees, expenses and carried interest.
|
|
(9)
|
TFV MOIC represents MOIC for Total Fair Value before management fees, expenses and carried interest, divided by Cumulative Invested Capital.
|
|
(10)
|
Fund Gross IRR is an annualized realized and unrealized fund-level return to fund investors of all investments, gross of management fees and carried interest.
|
|
(11)
|
Fund Net IRR is an annualized realized and unrealized return to fund investors, net of management fees, expenses and carried interest. Net return information reflects average fund level returns, which may differ from actual investor level returns due to timing, variance in fees paid by investors, and other investor-specific investment costs such as taxes.
|
|
Three Months Ended
June 30, |
Amount | % | ||||||||||||||
| 2021 | 2020 | Change | Change | |||||||||||||
|
Revenues ($ in thousands):
|
||||||||||||||||
|
Fund management fees
|
$ | 34,536 | $ | 25,723 | $ | 8,813 | 34 | % | ||||||||
|
Property management and leasing fees
|
14,335 | 14,845 | (510 | ) | -3 | % | ||||||||||
|
Construction management fees
|
2,065 | 2,215 | (150 | ) | -7 | % | ||||||||||
|
Development fees
|
1,163 | 373 | 790 | 212 | % | |||||||||||
|
Transaction fees
|
16,242 | 8,294 | 7,948 | 96 | % | |||||||||||
|
Insurance premiums
|
2,022 | 1,349 | 673 | 50 | % | |||||||||||
|
Other asset management and property income
|
1,611 | 2,343 | (732 | ) | -31 | % | ||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total revenues
|
$ | 71,974 | $ | 55,142 | $ | 16,832 | 31 | % | ||||||||
|
|
|
|
|
|
|
|||||||||||
| Three Months Ended | ||||||||||||||||
| June 30, | Amount | % | ||||||||||||||
| 2021 | 2020 | Change | Change | |||||||||||||
|
Investment income ($ in thousands):
|
||||||||||||||||
|
Performance allocations
|
||||||||||||||||
|
Realized
|
$ | 35,629 | $ | 5,324 | $ | 30,305 | 569 | % | ||||||||
|
Unrealized
|
43,248 | (21,435 | ) | 64,683 | 302 | % | ||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total performance allocations
|
78,877 | (16,111 | ) | 94,988 | ||||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Earnings from investments in real estate
|
980 | (178 | ) | 1,158 | 651 | % | ||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total investment income
|
$ | 79,857 | $ | (16,289 | ) | $ | 96,146 | 590 | % | |||||||
|
|
|
|
|
|
|
|||||||||||
|
Three Months Ended
June 30, 2021 |
Three Months Ended
June 30, 2020 |
|||||||||||||||
| Realized | Unrealized | Realized | Unrealized | |||||||||||||
|
BMF III
|
$ | 21,617 | $ | (4,643 | ) | $ | 3,380 | $ | 955 | |||||||
|
BMF IV
|
— | 22,640 | — | 5,975 | ||||||||||||
|
BWH I
|
— | 7,525 | — | 1,878 | ||||||||||||
|
BDS I
|
— | 44 | (12 | ) | (184 | ) | ||||||||||
|
BDS II
|
— | 4,903 | 1,956 | (27,268 | ) | |||||||||||
|
BDS III
|
14,012 | 6,913 | — | (3,340 | ) | |||||||||||
|
BDS IV
|
— | 948 | — | — | ||||||||||||
|
BOF I
|
— | 3,915 | — | 549 | ||||||||||||
|
BOF II
|
— | 1,157 | — | — | ||||||||||||
|
BAMBS
|
— | (154 | ) | — | — | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total
|
$ | 35,629 | $ | 43,248 | $ | 5,324 | $ | (21,435 | ) | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Three Months Ended | ||||||||||||||||
| June 30, | Amount | % | ||||||||||||||
| 2021 | 2020 | Change | Change | |||||||||||||
|
Expenses ($ in thousands):
|
||||||||||||||||
|
Employee compensation and benefits
|
$ | 42,306 | $ | 19,839 | $ | 22,467 | 113 | % | ||||||||
|
Performance allocations compensation
|
||||||||||||||||
|
Realized
|
3,747 | 517 | 3,230 | 625 | % | |||||||||||
|
Unrealized
|
6,048 | (2,424 | ) | 8,472 | 350 | % | ||||||||||
|
Loss and loss adjustment expenses
|
2,132 | 1,096 | 1,036 | 95 | % | |||||||||||
|
Third-party operating expenses
|
6,117 | 7,083 | (966 | ) | -14 | % | ||||||||||
|
General and administrative expenses
|
5,392 | 4,070 | 1,322 | 32 | % | |||||||||||
|
Depreciation and amortization
|
727 | 672 | 55 | 8 | % | |||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total expenses
|
$ | 66,469 | $ | 30,853 | $ | 35,616 | 115 | % | ||||||||
|
|
|
|
|
|
|
|||||||||||
| Three Months Ended | ||||||||||||||||
| June 30, | Amount | % | ||||||||||||||
| 2021 | 2020 | Change | Change | |||||||||||||
|
Other income (expense) ($ in thousands)
|
||||||||||||||||
|
Net realized and unrealized gains (losses)
|
$ | 300 | $ | 152 | $ | 148 | 97 | % | ||||||||
|
Interest income
|
557 | 231 | 326 | 141 | % | |||||||||||
|
Interest expense
|
(2,554 | ) | (444 | ) | (2,110 | ) | 475 | % | ||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total other income (expense)
|
$ | (1,697 | ) | $ | (61 | ) | $ | (1,636 | ) | 2682 | % | |||||
|
|
|
|
|
|
|
|||||||||||
| Three Months Ended | ||||||||
| June 30, | ||||||||
| 2021 | 2020 | |||||||
|
Non-controlling
interest related to consolidated fund managers and subsidiaries
|
$ | 1,205 | $ | 2,598 | ||||
|
Non-controlling
interest related to 2019 profits interests awards
|
4,502 | 1,852 | ||||||
|
Non-controlling
interest related to 2020 profits interests awards
|
108 | — | ||||||
|
|
|
|
|
|||||
|
Total
|
$ | 5,815 | $ | 4,450 | ||||
|
|
|
|
|
|||||
| Six Months Ended | ||||||||||||||||
| June 30, | Amount | % | ||||||||||||||
| 2021 | 2020 | Change | Change | |||||||||||||
|
Revenues ($ in thousands):
|
||||||||||||||||
|
Fund management fees
|
$ | 65,387 | $ | 51,442 | $ | 13,945 | 27 | % | ||||||||
|
Transaction fees
|
21,568 | 15,639 | 5,929 | 38 | % | |||||||||||
|
Property management and leasing fees
|
31,081 | 31,367 | (286 | ) | -1 | % | ||||||||||
|
Construction management fees
|
3,891 | 3,777 | 114 | 3 | % | |||||||||||
|
Development fees
|
1,549 | 577 | 972 | 168 | % | |||||||||||
|
Insurance premiums
|
3,916 | 2,505 | 1,411 | 56 | % | |||||||||||
|
Other asset management and property income
|
3,131 | 3,543 | (412 | ) | -12 | % | ||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total revenues
|
$ | 130,523 | $ | 108,850 | $ | 21,673 | 20 | % | ||||||||
|
|
|
|
|
|
|
|||||||||||
| Six Months Ended | ||||||||||||||||
| June 30, | Amount | % | ||||||||||||||
| 2021 | 2020 | Change | Change | |||||||||||||
|
Investment income ($ in thousands):
|
||||||||||||||||
|
Incentive fees
|
$ | 910 | $ | — | $ | 910 | NA | |||||||||
|
Performance allocations
|
||||||||||||||||
|
Realized
|
41,185 | 9,435 | 31,750 | 337 | % | |||||||||||
|
Unrealized
|
57,967 | (2,618 | ) | 60,585 | 2314 | % | ||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total performance allocations
|
100,062 | 6,817 | 93,245 | 1368 | % | |||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Earnings from investments in real estate
|
976 | (590 | ) | 1,566 | 265 | % | ||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total investment income
|
$ | 101,038 | $ | 6,227 | $ | 94,811 | 1523 | % | ||||||||
|
|
|
|
|
|
|
|||||||||||
| Six Months Ended | Six Months Ended | |||||||||||||||
| June 30, 2021 | June 30, 2020 | |||||||||||||||
| Realized | Unrealized | Realized | Unrealized | |||||||||||||
|
BMF III
|
$ | 25,593 | $ | (3,604 | ) | $ | 7,491 | $ | 6,800 | |||||||
|
BMF IV
|
— | 28,989 | — | 8,766 | ||||||||||||
|
BWH I
|
— | 9,967 | — | 4,967 | ||||||||||||
|
BDS I
|
— | 35 | (12 | ) | (160 | ) | ||||||||||
|
BDS II
|
— | 8,228 | 1,956 | (26,234 | ) | |||||||||||
|
BDS III
|
15,592 | 15,326 | — | — | ||||||||||||
|
BDS IV
|
— | 948 | — | — | ||||||||||||
|
BOF I
|
— | (3,470 | ) | — | 3,336 | |||||||||||
|
BOF II
|
— | 858 | — | — | ||||||||||||
|
BAMBS
|
— | 690 | — | — | ||||||||||||
|
BSH I
|
— | — | — | (93 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total
|
$ | 41,185 | $ | 57,967 | $ | 9,435 | $ | (2,618 | ) | |||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Six Months Ended | ||||||||||||||||
| June 30, | Amount | % | ||||||||||||||
| 2021 | 2020 | Change | Change | |||||||||||||
|
Expenses ($ in thousands):
|
||||||||||||||||
|
Employee compensation and benefits
|
$ | 69,457 | $ | 44,532 | $ | 24,925 | 56 | % | ||||||||
|
Incentive fee compensation
|
82 | — | 82 | NA | ||||||||||||
|
Performance allocations compensation
|
||||||||||||||||
|
Realized
|
4,241 | 905 | 3,336 | 369 | % | |||||||||||
|
Unrealized
|
7,477 | (144 | ) | 7,621 | 5292 | % | ||||||||||
|
Loss and loss adjustment expenses
|
2,917 | 1,678 | 1,239 | 74 | % | |||||||||||
|
Third-party operating expenses
|
14,743 | 15,643 | (900 | ) | -6 | % | ||||||||||
|
General and administrative expenses
|
9,492 | 8,761 | 731 | 8 | % | |||||||||||
|
Depreciation and amortization
|
1,480 | 1,344 | 136 | 10 | % | |||||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total expenses
|
$ | 109,889 | $ | 72,719 | $ | 37,170 | 51 | % | ||||||||
|
|
|
|
|
|
|
|||||||||||
|
Six Months Ended
June 30, |
Amount | % | ||||||||||||||
| 2021 | 2020 | Change | Change | |||||||||||||
|
Other income (expense) ($ in thousands)
|
||||||||||||||||
|
Net realized and unrealized gains
|
$ | 6,097 | $ | 807 | $ | 5,290 | 656 | % | ||||||||
|
Interest income
|
1,165 | 603 | 562 | 93 | % | |||||||||||
|
Interest expense
|
(4,140 | ) | (925 | ) | (3,215 | ) | 348 | % | ||||||||
|
|
|
|
|
|
|
|||||||||||
|
Total other income (expense)
|
$ | 3,122 | $ | 485 | $ | 2,637 | 544 | % | ||||||||
|
|
|
|
|
|
|
|||||||||||
| Six Months Ended | ||||||||
| June 30, | ||||||||
| 2021 | 2020 | |||||||
|
Non-controlling
interest related to consolidated fund managers and subsidiaries
|
$ | 3,497 | $ | 4,632 | ||||
|
Non-controlling
interest related to 2019 profits interests awards
|
6,159 | 1,852 | ||||||
|
Non-controlling
interest related to 2020 profits interests awards
|
108 | — | ||||||
|
|
|
|
|
|||||
|
Total
|
$ | 9,764 | $ | 6,484 | ||||
|
|
|
|
|
|||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
|
($ in thousands)
|
2021 | 2020 | 2021 | 2020 | ||||||||||||
|
Net income
|
$ | 83,241 | $ | 7,769 | $ | 123,960 | $ | 42,661 | ||||||||
|
Income tax provision
|
424 | 170 | 834 | 182 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Income before provision for income taxes
|
83,665 | 7,939 | 124,794 | 42,843 | ||||||||||||
|
Depreciation and amortization
|
727 | 672 | 1,480 | 1,344 | ||||||||||||
|
Less: Unrealized performance allocations
|
(43,248 | ) | 21,435 | (57,967 | ) | 2,618 | ||||||||||
|
Plus: Unrealized performance allocations compensation
|
6,048 | (2,424 | ) | 7,477 | (144 | ) | ||||||||||
|
Less: Unrealized (gains) losses
|
(317 | ) | 71 | (6,098 | ) | (959 | ) | |||||||||
|
Plus: Share-based compensation
|
14,624 | 388 | 15,465 | 775 | ||||||||||||
|
Less: Net income attributable to
non-controlling
interests in subsidiaries
|
(5,815 | ) | (4,450 | ) | (9,764 | ) | (6,484 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Distributable Earnings attributable to the Operating Company
|
55,684 | 23,631 | 75,387 | 39,993 | ||||||||||||
|
Realized performance allocations and incentive fees
|
(35,629 | ) | (5,324 | ) | (42,095 | ) | (9,435 | ) | ||||||||
|
Realized performance allocations and incentive fees compensation
|
3,747 | 517 | 4,323 | 905 | ||||||||||||
|
Net insurance (income) loss
|
110 | (253 | ) | (999 | ) | (827 | ) | |||||||||
|
(Earnings) losses from investments in real estate
|
(980 | ) | 178 | (976 | ) | 590 | ||||||||||
|
Net interest (income)/expense and realized (gain)/loss
|
1,995 | (32 | ) | 2,935 | 423 | |||||||||||
|
Net income attributable to
non-controlling
interests
|
5,815 | 4,450 | 9,764 | 6,484 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total Fee Related Earnings
|
30,742 | 23,167 | 48,339 | 38,133 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Less: Total Fee Related Earnings attributable
to non-controlling interests
|
(5,815 | ) | (4,450 | ) | (9,764 | ) | (6,484 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total Fee Related Earnings to the Operating Company
|
$ | 24,927 | $ | 18,717 | $ | 38,575 | $ | 31,649 | ||||||||
|
|
|
|
|
|
|
|
|
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
|
($ in thousands)
|
2021 | 2020 | 2021 | 2020 | ||||||||||||
|
Fund-level fee revenues
|
||||||||||||||||
|
Fund management fees
|
$ | 34,536 | $ | 25,723 | $ | 65,387 | $ | 51,442 | ||||||||
|
Transaction fees, net
|
16,242 | 8,294 | 21,568 | 15,639 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total net fund-level fee revenues
|
50,778 | 34,017 | 86,955 | 67,081 | ||||||||||||
|
Net earnings from Bridge property operators
|
1,988 | 3,308 | 4,081 | 4,804 | ||||||||||||
|
Development fees
|
1,163 | 373 | 1,549 | 577 | ||||||||||||
|
Other asset management and property income
|
1,611 | 2,343 | 3,131 | 3,543 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Fee Related Revenues
|
55,540 | 40,041 | 95,716 | 76,005 | ||||||||||||
|
Cash-based employee compensation and benefits
|
(21,403 | ) | (14,280 | ) | (41,712 | ) | (32,547 | ) | ||||||||
|
Net administrative expenses
|
(3,395 | ) | (2,594 | ) | (5,665 | ) | (5,325 | ) | ||||||||
|
Fee Related Expenses
|
(24,798 | ) | (16,874 | ) | (47,377 | ) | (37,872 | ) | ||||||||
|
Total Fee Related Earnings
|
30,742 | 23,167 | 48,339 | 38,133 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Fee Related Earnings margin
|
55 | % | 58 | % | 51 | % | 50 | % | ||||||||
|
Total Fee Related Earnings attributable to non-controlling interests
|
(5,815 | ) | (4,450 | ) | (9,764 | ) | (6,484 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total Fee Related Earnings to the Operating Company
|
24,927 | 18,717 | 38,575 | 31,649 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Realized performance allocations and incentive fees
|
35,629 | 5,324 | 42,095 | 9,435 | ||||||||||||
|
Realized performance allocations and incentive fees compensation
|
(3,747 | ) | (517 | ) | (4,323 | ) | (905 | ) | ||||||||
|
Net insurance income
|
(110 | ) | 253 | 999 | 827 | |||||||||||
|
Earnings from investments in real estate
|
980 | (178 | ) | 976 | (590 | ) | ||||||||||
|
Net interest income (expense) and realized gain (loss)
|
(1,995 | ) | 32 | (2,935 | ) | (423 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Distributable Earnings attributable to the Operating Company
|
$ | 55,684 | $ | 23,631 | $ | 75,387 | $ | 39,993 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
|
($ in thousands)
|
2021 | 2020 | 2021 | 2020 | ||||||||||||
|
Cash-based employee compensation and benefits
|
$ | 21,403 | $ | 14,279 | $ | 41,711 | $ | 32,547 | ||||||||
|
Compensation expense of Bridge property operators
|
6,279 | 5,172 | 12,281 | 11,210 | ||||||||||||
|
Share based compensation
|
14,624 | 388 | 15,465 | 775 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Employee compensation and benefits
|
$ | 42,306 | $ | 19,839 | $ | 69,457 | $ | 44,532 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Administrative expenses, net of Bridge property operators
|
$ | 3,395 | $ | 2,594 | $ | 5,665 | $ | 5,325 | ||||||||
|
Administrative expenses of Bridge property operators
|
1,997 | 1,476 | 3,827 | 3,436 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
General and administrative expenses
|
$ | 5,392 | $ | 4,070 | $ | 9,492 | $ | 8,761 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Unrealized gains (losses)
|
$ | 317 | $ | (71 | ) | $ | 6,098 | $ | 959 | |||||||
|
Other expenses from Bridge property operators
|
(19 | ) | (22 | ) | (41 | ) | (51 | ) | ||||||||
|
Net interest income/(expense) and realized gain/(loss)
|
(1,995 | ) | 32 | (2,935 | ) | (423 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total other income (expense)
|
$ | (1,697 | ) | $ | (61 | ) | $ | 3,122 | $ | 485 | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
| • |
Fund management fees increased by $8.8 million, or 34%, primarily due to new funds launched subsequent to June 30, 2020.
|
| • |
Transaction fees increased by $7.9 million, or 96%, largely due to an increase in acquisitions and mortgage
re-financings
primarily related to multifamily assets.
|
| • |
Cash-based employee compensation and benefits increased by $7.1 million, or 50%, primarily due to increased headcount.
|
| • |
Net administrative expenses increased by $0.8 million, or 31%, due to increased expenses related to the public offering that were not deemed to be offering costs. Additionally, net administrative expenses were lower in 2020 due to reduced travel and office spend, and lower bonuses were paid in 2020 due to covid.
|
| • |
Fund management fees increased by $13.9 million, or 27%, primarily due to new funds launched subsequent to June 30, 2020.
|
| • |
Transaction fees increased by $5.9 million, or 38%, largely due to an increase in acquisitions and mortgage
re-financings
related to our multifamily assets
|
| • |
Cash-based employee compensation and benefits increased by $9.2 million, or 28%, due to increased headcount, and lower bonuses were paid in 2020.
|
| • |
Net administrative expenses increased by $0.3 million, or 6%, due to increased expenses related to the IPO.
|
|
Six Months
Ended June 30, |
||||||||
|
(in thousands)
|
2021 | 2020 | ||||||
|
Net cash provided by operating activities
|
$ | 98,477 | $ | 57,785 | ||||
|
Net cash provided by (used in) investing activities
|
33,195 | (21,391 | ) | |||||
|
Net cash used in financing activities
|
(171,869 | ) | (47,721 | ) | ||||
|
|
|
|
|
|||||
|
Total increase (decrease) in cash, cash equivalents, and restricted cash
|
$ | (40,197 | ) | $ | (11,327 | ) | ||
|
|
|
|
|
|||||
| • |
Level 1 — Pricing inputs are unadjusted, quoted prices in active markets for identical assets or liabilities as of the measurement date.
|
| • |
Level 2 — Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the measurement date, and fair value is determined through the use of models or other valuation methodologies. The types of financial instruments classified in this category include less liquid securities traded in active markets, securities traded in other than active markets, and government and agency securities.
|
| • |
Level 3 — Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value require significant management judgment or estimation.
|
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
|
Item 4.
|
Controls and Procedures
|
|
Item 1.
|
Legal Proceedings
|
|
Item 1A.
|
Risk Factors
|
| • |
market conditions and investment opportunities during previous periods may have been significantly more favorable for generating positive performance than those we may experience in the future;
|
| • |
our historical returns derive largely from the performance of our earlier funds, whereas future fund returns will depend increasingly on the performance of our newer funds or funds not yet formed;
|
| • |
our newly established funds may generate lower returns during the period that they initially deploy their capital;
|
| • |
in recent years, there has been increased competition for investment opportunities resulting from the increased amount of capital invested in private markets alternatives and high liquidity in debt markets, and the increased competition for investments may reduce our returns in the future; and
|
| • |
the performance of particular funds or other investments also will be affected by risks of the real estate markets and properties in which they invest.
|
| • |
decreases in the market value of securities, debt instruments or investments held by some of our funds;
|
| • |
illiquidity in the market, which could adversely affect transaction volumes and the pace of realization of our funds’ investments or otherwise restrict the ability of our funds to realize value from their investments, thereby adversely affecting our ability to generate performance fees or other income;
|
| • |
our assets under management to decrease, thereby lowering a portion of our management fees payable by our funds to the extent they are based on market values; and
|
| • |
increases in costs or reduced availability of financial instruments that finance our funds.
|
| • |
some of our competitors have more relevant experience, greater financial and other resources and more personnel than we do;
|
| • |
there are relatively few barriers to entry impeding new asset management firms, including a relatively low cost of entering these lines of business, and the successful efforts of new entrants into our various lines of business have resulted in increased competition;
|
| • |
if, as we expect, allocation of assets to alternative investment strategies increases, there may be increased competition for alternative investments and access to fund general partners and managers;
|
| • |
certain investors may prefer to invest with private partnerships; and
|
| • |
other industry participants will from time to time seek to recruit our investment professionals and other employees away from us.
|
| • |
allocation of expenses to and among different jurisdictions;
|
| • |
changes in the valuation of our deferred tax assets and liabilities;
|
| • |
expected timing and amount of the release of any tax valuation allowances;
|
| • |
tax effects of stock-based compensation;
|
| • |
costs related to intercompany restructurings;
|
| • |
changes in tax laws, tax treaties, regulations or interpretations thereof; or
|
| • |
lower than anticipated future earnings in jurisdictions where we have lower statutory tax rates and higher than anticipated future earnings in jurisdictions where we have higher statutory tax rates.
|
| • |
the last day of its fiscal year following the fifth anniversary of the date of its initial public offering of common equity securities;
|
| • |
the last day of its fiscal year in which it has annual gross revenue of $1.07 billion or more;
|
| • |
the date on which it has, during the previous three-year period, issued more than $1.07 billion in nonconvertible debt; and
|
| • |
the date on which it is deemed to be a “large accelerated filer, ” which will occur at such time as the company (1) has an aggregate worldwide market value of common equity securities held by
non-affiliates
of $700 million or more as of the last business day of its most recently completed second fiscal quarter, (2) has been required to file annual and quarterly reports under the Exchange Act for a period of at least 12 months, and (3) has filed at least one annual report pursuant to the Exchange Act.
|
| • |
only be required to have two years of audited financial statements and two years of related management’s discussion and analysis of financial condition and results of operations disclosure;
|
| • |
not be required to engage an auditor to report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes- Oxley Act;
|
| • |
not be required to comply with the requirement of the PCAOB, regarding the communication of critical audit matters in the auditor’s report on the financial statements;
|
| • |
not be required to submit certain executive compensation matters to stockholder advisory votes, such as
“say-on-pay,”
“say-on-frequency”
“say-on-golden
|
| • |
not be required to comply with certain disclosure requirements related to executive compensation, such as the requirement to present a comparison of our Chief Executive Officer’s compensation to our median employee compensation.
|
| • |
on or after the first anniversary of the completion of the IPO, each of Messrs. Morse, Slager, O’Farrell, Allara and Briggs may transfer or encumber up to
one-third
of his vested existing interests;
|
| • |
on or after the second anniversary of the completion of the IPO, each of Messrs. Morse, Slager, O’Farrell, Allara and Briggs may transfer or encumber up to
two-thirds
of his vested existing interests; and
|
| • |
on or after the third anniversary of the completion of the IPO, each of Messrs. Morse, Slager, O’Farrell, Allara and Briggs may transfer or encumber all of his vested existing interests.
|
| • |
a classified board of directors with staggered three-year terms;
|
| • |
the ability of our board of directors to issue one or more series of preferred stock;
|
| • |
advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;
|
| • |
certain limitations on convening special stockholder meetings;
|
| • |
no cumulative voting in the election of directors;
|
| • |
any action required or permitted to be taken by the stockholders must be effected at a duly called annual or special meeting of stockholders and may not be effected by any consent in writing in lieu of a meeting of such stockholders;
|
| • |
our amended and restated bylaws may be altered only by the affirmative vote of a majority of the whole board of directors or the holders of at least a majority of the voting power represented by our then-outstanding voting stock, voting together as a single class;
|
| • |
subject to the rights of the holders of any preferred stock and the terms of the Stockholders Agreement, the number of directors will be determined exclusively by a majority of the whole board of directors; and
|
| • |
the removal of directors only for cause and only upon the affirmative vote of the holders of at least 66 2/3% of the voting power represented by our then-outstanding common stock (other than directors appointed pursuant to the Stockholders Agreement, who may be removed with or without cause in accordance with the terms of the Stockholders Agreement).
|
| • |
results of operations that vary from the expectations of securities analysts and investors;
|
| • |
results of operations that vary from those of our competitors;
|
| • |
changes in expectations as to our future financial performance, including financial estimates and investment recommendations by securities analysts and investors;
|
| • |
technology changes in our industry;
|
| • |
security breaches related to our systems or those of our affiliates;
|
| • |
changes in economic conditions for companies in our industry;
|
| • |
changes in market valuations of, or earnings and other announcements by, companies in our industry;
|
| • |
declines in the market prices of stocks generally, particularly those of companies in our industry;
|
| • |
strategic actions by us or our competitors;
|
| • |
announcements by us or our competitors of significant contracts, acquisitions, joint ventures, other strategic relationships, or capital commitments;
|
| • |
changes in general economic or market conditions or trends in our industry or the economy as a whole and, in particular, in the real estate environment;
|
| • |
changes in business or regulatory conditions;
|
| • |
future sales of our Class A common stock or other securities;
|
| • |
investor perceptions of the investment opportunity associated with our Class A common stock relative to other investment alternatives;
|
| • |
the public’s response to press releases or other public announcements by us or third parties, including our filings with the SEC;
|
| • |
announcements relating to litigation or governmental investigations;
|
| • |
guidance, if any, that we provide to the public, any changes in this guidance, or our failure to meet this guidance;
|
| • |
the development and sustainability of an active trading market for our stock;
|
| • |
changes in accounting principles; and
|
| • |
other events or factors, including those resulting from system failures and disruptions, natural disasters, war, acts of terrorism, an outbreak of highly infectious or contagious diseases, such as
COVID-19,
or responses to these events.
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
|
Item 3.
|
Defaults Upon Senior Securities
|
|
Item 4.
|
Mine Safety Disclosures
|
|
Item 5.
|
Other Information
|
|
Item 6.
|
Exhibits
|
| # |
Indicates management contract or compensatory plan.
|
| * |
This certification is deemed not filed for purpose of section 18 of the Exchange Act or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act.
|
| BRIDGE INVESTMENT GROUP HOLDINGS INC. | ||||||
| Date: August 16, 2021 | By: |
/s/ Jonathan Slager
|
||||
| Jonathan Slager | ||||||
| Chief Executive Officer | ||||||
| (Principal Executive Officer) | ||||||
| Date: August 16, 2021 | By: |
/s/ Chad Briggs
|
||||
| Chad Briggs | ||||||
| Chief Financial Officer | ||||||
| (Principal Financial Officer) | ||||||
Exhibit 3.1
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
BRIDGE INVESTMENT GROUP HOLDINGS INC.
Bridge Investment Group Holdings Inc., a corporation organized and existing under the laws of the State of Delaware, hereby certifies as follows:
1. The original Certificate of Incorporation of the Corporation was filed with the Office of the Secretary of State of the State of Delaware on March 18, 2021 (the “Original Certificate”).
2. The Corporation is filing this Amended and Restated Certificate of Incorporation of the Corporation (the “Certificate of Incorporation”), which restates, integrates and further amends the Original Certificate, as heretofore amended, and which was duly adopted by all necessary action of the board of directors of the Corporation and the stockholders of the Corporation in accordance with the provisions of Sections 242, 245 and 228 of the General Corporation Law of the State of Delaware.
3. The text of the Original Certificate is hereby amended and restated in its entirety to read in full as follows:
ARTICLE I.
The name of the corporation is Bridge Investment Group Holdings Inc. (the “Corporation”).
ARTICLE II.
The address of the Corporation’s registered office in the State of Delaware is 1209 Orange Street, New Castle County, Wilmington, Delaware, 19801. The name of its registered agent at such address is The Corporation Trust Company.
ARTICLE III.
The nature of the business of the Corporation and the objects or purposes to be transacted, promoted or carried on by the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “DGCL”), including, without limitation, (i) investing in securities of Bridge Investment Group Holdings LLC, a Delaware limited liability company, or any successor entities thereto (“BIG LLC”) and any of its subsidiaries, (ii) exercising all rights, powers, privileges and other incidents of ownership or possession with respect to the Corporation’s assets, including managing, holding, selling and disposing of such assets and (iii) engaging in any other activities incidental or ancillary thereto.
ARTICLE IV.
Section 4.1 Authorized Stock and Recapitalization.
(a) Authorized Stock. The total number of shares of all classes of stock that the Corporation is authorized to issue is seven hundred seventy million (770,000,000) shares, consisting of three classes as follows:
(i) five hundred million (500,000,000) shares of Class A common stock, with a par value of $0.01 per share (the “Class A Common Stock”);
(ii) two hundred fifty million (250,000,000) shares of Class B common stock, with a par value of $0.01 per share (the “Class B Common Stock”); and
(iii) twenty million (20,000,000) shares of preferred stock, with a par value of $0.01 per share (the “Preferred Stock”).
(b) Recapitalization. Effective upon the effectiveness of the filing of this Certificate of Incorporation with the Secretary of State of the State of Delaware, all shares of common stock, par value $0.01 per share, of the Corporation issued and outstanding immediately prior to the filing of this Certificate of Incorporation (the “Existing Common Stock”) shall be recapitalized, reclassified and reconstituted into one (1) fully paid and non-assessable share of Class A Common Stock (as defined below) (the “Recapitalization”). The Recapitalization shall occur automatically without any further action by the holder of Existing Common Stock. The outstanding stock certificate that, immediately prior to the Recapitalization, represented the outstanding Existing Common Shares shall, upon and after the Recapitalization, be deemed to represent one (1) share of Class A Common Stock, without the need for surrender or exchange thereof.
Section 4.2 Preferred Stock. The board of directors of the Corporation (the “Board of Directors”) is authorized to provide, out of the unissued shares of Preferred Stock, for the issuance of shares of Preferred Stock in one or more series, and by filing a certificate pursuant to the applicable law of the State of Delaware (such certificate being hereinafter referred to as a “Preferred Stock Designation”), to establish from time to time the number of shares to be included in each such series and to fix the powers, designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions thereof, including, without limitation, the authority to fix the dividend rights, dividend rates, conversion rights, exchange rights, voting rights, rights and terms of redemption (including sinking and purchase fund provisions), the redemption price or prices, restrictions on the issuance of shares of such series, the dissolution preferences and the rights in respect of any distribution of assets of any wholly unissued series of Preferred Stock, or any of them and to increase (but not above the total number of authorized shares of Preferred Stock) or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series so created (except where otherwise provided in the Preferred Stock Designation), subsequent to the issue of that series. In case the authorized number of shares of any series shall be so decreased, the shares constituting such decrease shall resume the status which they had prior to the adoption of the resolution originally fixing the number of shares of such series (except where otherwise provided in the
2
Preferred Stock Designation). There shall be no limitation or restriction on any variation between any of the different series of Preferred Stock as to the designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof; and the several series of Preferred Stock may vary in any and all respects as fixed and determined by the resolution or resolutions of the Board of Directors or by a duly authorized committee of the Board of Directors, providing for the issuance of the various series of Preferred Stock.
Section 4.3 Number of Authorized Shares. The number of authorized shares of any of the Class A Common Stock, Class B Common Stock or Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the voting power of all of the outstanding shares of stock of the Corporation entitled to vote thereon, without a separate vote of any holders of shares of Class A Common Stock, Class B Common Stock or Preferred Stock, or of any series thereof, irrespective of the provisions of Section 242(b)(2) of the DGCL, unless a separate vote of any such holders is required pursuant to the terms of any Preferred Stock Designation.
Section 4.4 Common Stock. The powers, preferences and rights of the Class A Common Stock and the Class B Common Stock, and the qualifications, limitations or restrictions thereof are as follows:
(a) Voting Rights. Except as otherwise required by law,
(i) Each share of Class A Common Stock shall entitle the record holder thereof as of the applicable record date to one (1) vote per share in person or by proxy on all matters submitted to a vote of the holders of Class A Common Stock, whether voting separately as a class or otherwise.
(ii) Each share of Class B Common Stock shall entitle the record holder thereof as of the applicable record date to ten (10) votes per share in person or by proxy on all matters submitted to a vote of the holders of Class B Common Stock, whether voting separately as a class or otherwise.
(iii) Except as otherwise required in this Certificate of Incorporation or by applicable law, the holders of shares of Class A Common Stock and Class B Common Stock shall vote together as a single class (or, if any holders of shares of Preferred Stock are entitled to vote together with the holders of Class A Common Stock and Class B Common Stock, as a single class with such holders of Preferred Stock) on all matters submitted to a vote of stockholders of the Corporation.
(b) Dividends and Distributions. Subject to applicable law and the rights, if any, of the holders of any outstanding series of Preferred Stock or any class or series of stock having a preference over or the right to participate with the Class A Common Stock with respect to the payment of dividends, dividends may be declared and paid on the Class A Common Stock out of the assets or funds of the Corporation that are by law available therefor, at such times and in such amounts as the Board of Directors in its discretion shall determine. Other than in connection with a dividend declared by the Board of Directors in connection with a “poison pill”
3
or similar stockholder rights plan, dividends shall not be declared or paid on the Class B Common Stock and the holders of shares of Class B Common Stock shall have no right to receive dividends in respect of such shares of Class B Common Stock.
(c) Liquidation Rights. In the event of liquidation, dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary, after payment or provision for payment of the debts and other liabilities of the Corporation and after making provisions for preferential and other amounts, if any, to which the holders of Preferred Stock or any class or series of stock having a preference over or the right to participate with the Class A Common Stock with respect to payments in liquidation shall be entitled, the remaining assets and funds of the Corporation available for distribution shall be divided among and paid ratably to the holders of all outstanding shares of Class A Common Stock and Class B Common Stock in proportion to the number of shares held by each such stockholder; provided, that the holders of shares of Class B Common Stock shall be entitled to receive $0.01 per share, and upon receiving such amount, the holders of shares of Class B Common Stock, as such, shall not be entitled to receive any other assets or funds of the Corporation. A consolidation, reorganization or merger of the Corporation with any other Person or Persons (as defined below), or a sale of all or substantially all of the assets of the Corporation, shall not be considered to be a dissolution, liquidation or winding up of the Corporation within the meaning of this Section 4.4(c).
(d) Class B Common Stock.
(i) From and after the effectiveness of this Certificate of Incorporation with the Secretary of State of the State of Delaware (the “Effective Time”), shares of Class B Common Stock may be issued only to, and registered only in the name of, the Existing Owners (as defined below), their respective successors and assigns as well as their Permitted Transferees (as defined below) in accordance with Section 4.4 (including all subsequent successors, assigns and Permitted Transferees) (the Existing Owners together with such Persons, collectively, the “Permitted Class B Owners”) and the aggregate number of shares of Class B Common Stock at any time registered in the name of each such Permitted Class B Owner must be equal to the aggregate number of Class A Common Units (as defined below) held of record at such time by such Permitted Class B Owner under the LLC Agreement (as defined below). As used in this Certificate of Incorporation, (A) “Existing Owner” means each of the holders of Class A Common Units (other than the Corporation) of BIG LLC, as set forth on Schedule 1 of the LLC Agreement (as defined below) (as such Schedule 1 may be amended from time to time in accordance with the LLC Agreement), (B) “Class A Common Unit” means a limited liability company interest in BIG LLC, authorized and issued under the Fifth Amended and Restated Limited Liability Company Agreement of BIG LLC, dated as of the date hereof, as such agreement may be further amended, restated, amended and restated, supplemented or otherwise modified from time to time (the “LLC Agreement”), and constituting a “Class A Common Unit” as defined in such LLC Agreement and (C) “Permitted Transferee” has the meaning given to it in the LLC Agreement. Notwithstanding the foregoing, shares of Class B Common Stock may be transferred to the Corporation or to BIG LLC in connection with an exchange as contemplated by the LLC Agreement.
(ii) The Corporation shall, to the fullest extent permitted by law, undertake all necessary and appropriate action to ensure that the number of shares of Class B
4
Common Stock issued by the Corporation at any time to, or otherwise held of record by, any Permitted Class B Owner shall be equal to the aggregate number of Class A Common Units held of record by such Permitted Class B Owner in accordance with the terms of the LLC Agreement.
(iii) In the event that there is a merger, consolidation or Change of Control (as defined below) of the Corporation that was approved by the Board of Directors prior to such merger, consolidation or Change of Control, then the holders of shares of Class B Common Stock shall not be entitled to receive more than $0.01 per share of Class B Common Stock, whether in the form of consideration for such shares or in the form of a distribution of the proceeds of a sale of all or substantially all of the assets of the Corporation with respect to such shares.
Section 4.5 Transfer of Class B Common Stock.
(a) A holder of Class B Common Stock may surrender and transfer shares of Class B Common Stock to the Corporation for cancellation for no consideration at any time. Following the surrender, or other acquisition, of any shares of Class B Common Stock to or by the Corporation, the Corporation will take all actions necessary to cancel and retire such shares and such shares shall not be re-issued by the Corporation.
(b) Except as set forth in Section 4.5(a), a holder of Class B Common Stock may transfer or assign shares of Class B Common Stock (or any legal or beneficial interest in such shares) (directly or indirectly, including by operation of law) only to a Permitted Transferee of such holder, and only if such holder also simultaneously transfers an equal number of such holder’s Class A Common Units to such Permitted Transferee in compliance with the LLC Agreement. The transfer restrictions described in this Section 4.5(b) are referred to as the “Restrictions”.
(c) Any purported transfer of shares of Class B Common Stock in violation of the Restrictions shall be null and void ab initio. If, notwithstanding the Restrictions, a Person shall, voluntarily or involuntarily, purportedly become or attempt to become, the purported owner (“Purported Owner”) of shares of Class B Common Stock in violation of the Restrictions, then the Purported Owner shall not obtain any rights in, to or with respect to such shares of Class B Common Stock (the “Restricted Shares”), and the purported transfer of the Restricted Shares to the Purported Owner shall not be recognized by the Corporation, the Corporation’s transfer agent (the “Transfer Agent”) or the Secretary of the Corporation and each holder of such Restricted Share shall, to the fullest extent permitted by law, automatically, without any further action on the part of the Corporation, the holder thereof, the Purported Owner or any other party, not be entitled to any voting right with respect to those shares.
(d) Upon a determination by the Board of Directors that a Person has attempted or may attempt to transfer or to acquire Restricted Shares in violation of the Restrictions, the Corporation may take such action as it deems advisable to refuse to give effect to such transfer or acquisition on the books and records of the Corporation, including without limitation to cause the Transfer Agent or the Secretary of the Corporation, as applicable, to not record the Purported Owner as the record owner of the Restricted Shares, and to institute proceedings to enjoin or rescind any such transfer or acquisition.
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(e) The Board of Directors may, to the extent permitted by law, from time to time establish, modify, amend or rescind, by bylaw or otherwise, regulations and procedures not inconsistent with the provisions of this Section 4.5 for determining whether any transfer or acquisition of shares of Class B Common Stock would violate the Restrictions and for the orderly application, administration and implementation of the provisions of this Section 4.5. Any such procedures and regulations shall be kept on file with the Secretary of the Corporation and with the Transfer Agent and shall be made available for inspection by and, upon written request shall be mailed to, holders of shares of Class B Common Stock.
Section 4.6 Certificates. All certificates or book entries representing shares of Class B Common Stock shall bear a legend substantially in the following form (or in such other form as the Board of Directors may determine):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE RESTRICTIONS (INCLUDING RESTRICTIONS ON TRANSFER) SET FORTH IN THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF THE CORPORATION AS IT MAY BE AMENDED AND/OR RESTATED (A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE CORPORATION AND SHALL BE PROVIDED FREE OF CHARGE TO ANY STOCKHOLDER MAKING A REQUEST THEREFOR).
Section 4.7 Fractions. Class A Common Stock, Class B Common Stock, and Preferred Stock may be issued and transferred in fractions of a share which shall entitle the holder to exercise fractional voting rights and to have the benefit of all other rights of holders of Class A Common Stock and Class B Common Stock, as applicable. Subject to the Restrictions, holders of shares of Class A Common Stock and Class B Common Stock shall be entitled to transfer fractions thereof and the Corporation shall, and shall cause the Transfer Agent to, facilitate any such transfers, including by issuing certificates or making book entries representing any such fractional shares. For all purposes of this Certificate of Incorporation, all references to Class A Common Stock and Class B Common Stock or any share thereof (whether in the singular or plural) shall be deemed to include references to any fraction of a share of such Class A Common Stock or Class B Common Stock.
Section 4.8 Amendment.
Except as otherwise required by law, holders of Class A Common Stock and Class B Common Stock shall not be entitled to vote on any amendment to this Certificate of Incorporation (including any Preferred Stock Designation) that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to this Certificate of Incorporation (including any Preferred Stock Designation) or applicable law.
ARTICLE V.
The Corporation shall at all times reserve and keep available out of its authorized but unissued shares or other securities at least as many shares or other securities equal to the number of Class A Common Units held by the holders of Class A Common Units (other than the Corporation and any direct or indirect majority-owned subsidiary of the Corporation).
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ARTICLE VI.
The Bylaws of the Corporation (the “Bylaws”) may be altered, amended or repealed, and new bylaws made, by the affirmative vote of (a) a majority of the Whole Board of Directors or (b) a majority of the voting power of all of the outstanding voting stock of the Corporation entitled to vote thereon, voting together as a single class. For purposes of this Certificate of Incorporation, the term “Whole Board of Directors” shall mean the total number of authorized directors (from time to time) whether or not there exist any vacancies in previously authorized directorships.
ARTICLE VII.
Section 7.1 Ballot. Elections of directors (each such director, in such capacity, a “Director”) need not be by written ballot unless the Bylaws shall so provide.
Section 7.2 Number and Terms of the Board of Directors. Subject to the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances and the terms of that certain Stockholders Agreement, dated as of July 16, 2021, by and among the Corporation and the other Persons party thereto (as such agreement may be further amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Stockholders Agreement”), the number of Directors shall be fixed from time to time exclusively by a majority of the Whole Board of Directors; provided, that for as long as the Stockholders Agreement is in effect, the number of Directors shall never be less than the aggregate number of Directors that the parties to the Stockholders Agreement are entitled to designate from time to time pursuant to Section 1 thereof.
Section 7.3 Newly Created Directorships and Vacancies. Except as otherwise required by law and the separate rights of the holders of any series of Preferred Stock then outstanding, unless the Board of Directors otherwise determines, newly created directorships resulting from any increase in the authorized number of directors or any vacancies on the Board of Directors resulting from the death, resignation, disqualification, removal from office or other cause shall be filled (x) for so long as the Stockholders Agreement remains in effect, only by a majority vote of the Directors then in office, though less than a quorum, or by a sole remaining Director entitled to vote thereon, or by the vote of the stockholders entitled to vote thereon and (y) at any time when the Stockholders Agreement is no longer in effect, only by a majority of the Directors then in office, though less than a quorum, or by a sole remaining Director entitled to vote thereon, and not by the stockholders. Any Director so chosen shall hold office until the next election of the class for which such Director shall have been chosen and until his successor shall be elected and qualified.
Section 7.4 Removal for Cause. Subject to the rights of the holders of any series of Preferred Stock then outstanding, for as long as this Certificate of Incorporation provides for a classified Board of Directors, any Director, or the entire Board of Directors, may otherwise be removed only for cause by an affirmative vote of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of all the outstanding shares of stock entitled to vote generally in the election
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of directors, at a meeting duly called for that purpose. Notwithstanding the foregoing, the directors appointed pursuant to the Stockholders Agreement may be removed with or without cause in accordance with the terms thereof and the requirements of the DGCL.
Section 7.5 Classified Board. The Directors shall be classified, with respect to the time for which they shall hold their respective offices, by dividing them into three (3) classes, with each Director then in office to be designated as a Class I Director, a Class II Director or a Class III Director, with each class to be apportioned as nearly equal in number as possible. Directors shall be assigned to each class in accordance with a resolution or resolutions adopted by the Board of Directors. The initial Class I Directors shall serve for a term expiring at the first annual meeting of stockholders of the Corporation following the date the shares of Class A Common Stock are first publicly traded (the “IPO Date”); the initial Class II Directors shall serve for a term expiring at the second annual meeting of stockholders following the IPO Date; and the initial Class III Directors shall serve for a term expiring at the third annual meeting of stockholders following the IPO Date. At each annual meeting of stockholders beginning with the first annual meeting of stockholders following the IPO Date, the successors of the class of Directors whose term expires at that meeting shall be elected to hold office for a term expiring at the third annual meeting of stockholders to be held following their election, with each Director in each such class to hold office until his or her successor is duly elected and qualified, subject to such Director’s earlier death, resignation or removal in accordance with Section 7.4 of this Amended and Restated Certificate of Incorporation. Subject to the Stockholders Agreement, the Board of Directors is authorized to assign each Director already in office at the Effective Time, as well as each Director elected or appointed to a newly created directorship due to an increase in the size of the Board of Directors, to Class I, Class II or Class III. Without limitation to the rights of the stockholders party to the Stockholders Agreement, the provisions of this Section 7.5 are subject to the rights of the holders of any class or series of Preferred Stock to elect directors and such directors need not serve classified terms. Whenever the holders of any one or more series of Preferred Stock issued by the Corporation shall have the right, voting separately as a series or separately as a class with one or more such other series, to elect directors at an annual or special meeting of stockholders, the election, term of office, removal and other features of such directorships shall be governed by the terms of this Certificate of Incorporation (including any Preferred Stock Designation) applicable thereto. The number of directors that may be elected by the holders of any such series of Preferred Stock shall be in addition to the number fixed pursuant to Section 7.2 hereof, and the total number of directors constituting the Whole Board shall be automatically adjusted accordingly. Except as otherwise provided by the Board in the resolution or resolutions establishing such series, whenever the holders of any series of Preferred Stock having such right to elect additional directors are divested of such right pursuant to the provisions of such stock, the terms of office of all such additional directors elected by the holders of such stock, or elected to fill any vacancies resulting from the death, resignation, disqualification or removal of such additional directors, shall forthwith terminate (in which case each such director thereupon shall cease to be qualified as, and shall cease to be, a director) and the total authorized number of directors of the Corporation shall automatically be reduced accordingly.
Section 7.6 Notice. Advance notice of stockholder nominations for election of Directors and other business to be brought by stockholders before a meeting of stockholders shall be given in the manner provided by the Bylaws.
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ARTICLE VIII.
Any action required or permitted to be taken by the Corporation’s stockholders at any annual or special meetings of stockholders may be taken only at a duly called annual or special meeting of the Corporation’s stockholders and the power of stockholders to act by consent without a meeting is specifically denied; provided, however, that any action required or permitted to be taken by the holders of Preferred Stock, voting separately as a series or separately as a class with one or more other such series, may be taken without a meeting, without prior notice and without a vote, to the extent expressly so provided in the Preferred Stock Designation.
The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation; provided, that any amendment (including by merger, consolidation or otherwise) to this Certificate of Incorporation that gives holders of the Class B Common Stock (i) any rights to receive dividends or any other kind of distribution other than in connection with a dissolution or liquidation pursuant to Section 4.4(c), (ii) any right to convert into or be exchanged for Class A Common Stock or (iii) any other economic rights shall, shall require, in addition to the affirmative vote of at least a majority of the voting power of all of the outstanding voting stock of the Corporation entitled to vote, the affirmative vote of a majority in voting power of the outstanding shares of Class A Common Stock voting separately as a class.
ARTICLE IX.
The Corporation is authorized to indemnify, and to advance expenses to, each current or former Director, officer, employee or agent of the Corporation to the fullest extent permitted by Section 145 of the DGCL as it presently exists or may hereafter be amended. To the fullest extent permitted by the laws of the State of Delaware as it exists on the date hereof or as it may hereafter be amended, no Director shall be personally liable to the Corporation or its stockholders for monetary damages for any breach of his or her fiduciary duties as a director. No amendment to, or modification or repeal of, this Article X shall adversely affect any right or protection of a Director or of any officer, employee or agent of the Corporation existing hereunder with respect to any act or omission occurring prior to such amendment, modification or repeal.
ARTICLE X.
Section 10.1 Corporate Opportunity.
(a) To the fullest extent permitted by the laws of the State of Delaware and in accordance with Section 122(17) of the DGCL, (i) the Corporation hereby renounces all interest and expectancy that it otherwise would be entitled to have in, and all rights to be offered an opportunity to participate in, any business opportunity that from time to time may be presented to any of the current Directors or their respective Affiliates (other than the Corporation and its subsidiaries), and any of their respective principals, members, directors, partners, stockholders, officers, employees or other representatives (other than any such Person who is also an employee of the Corporation or its subsidiaries), or any stockholder who is not employed by the Corporation or its subsidiaries (each such Person, an “Exempt Person”); (ii) no Exempt Person will have any
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duty to refrain from (1) engaging in a corporate opportunity in the same or similar lines of business in which the Corporation or its subsidiaries from time to time is engaged or proposes to engage or (2) otherwise competing, directly or indirectly, with the Corporation or any of its subsidiaries; and (iii) if any Exempt Person acquires knowledge of a potential transaction or other business opportunity which may be a corporate opportunity both for such Exempt Person or any of his or her respective Affiliates, on the one hand, and for the Corporation or its subsidiaries, on the other hand, such Exempt Person shall have no duty to communicate or offer such transaction or business opportunity to the Corporation or its subsidiaries and such Exempt Person may take any and all such transactions or opportunities for itself or offer such transactions or opportunities to any other Person. Notwithstanding the foregoing, the preceding sentence of this Section 11.1(a) shall not apply to any potential transaction or business opportunity that is expressly offered to a Director, executive officer or employee of the Corporation or its subsidiaries, solely in his or her capacity as a Director, executive officer or employee of the Corporation or its subsidiaries.
(b) To the fullest extent permitted by the laws of the State of Delaware, no potential transaction or business opportunity may be deemed to be a corporate opportunity of the Corporation or its subsidiaries unless (i) the Corporation or its subsidiaries would be permitted to undertake such transaction or opportunity in accordance with this Certificate of Incorporation, (ii) the Corporation or its subsidiaries at such time have sufficient financial resources to undertake such transaction or opportunity, (iii) the Corporation or its subsidiaries have an interest or expectancy in such transaction or opportunity and (iv) such transaction or opportunity would be in the same or similar line of business in which the Corporation or its subsidiaries are then engaged or a line of business that is reasonably related to, or a reasonable extension of, such line of business.
Section 10.2 Liability. To the fullest extent permitted by law, no stockholder and no Director will be liable to the Corporation or its subsidiaries or stockholders for breach of any duty solely by reason of any activities or omissions of the types referred to in this Article XI, except to the extent such actions or omissions are in breach of this Article XI.
ARTICLE XI.
Unless the Corporation consents in writing to the selection of an alternative forum, (a) the Court of Chancery (the “Chancery Court”) of the State of Delaware (or, in the event that the Chancery Court does not have jurisdiction, the federal district court for the District of Delaware or other state courts of the State of Delaware) shall, to the fullest extent permitted by law, be the sole and exclusive forum for (i) any derivative action, suit or proceeding brought on behalf of the Corporation, (ii) any action, suit or proceeding asserting a claim of breach of a fiduciary duty owed by any current or former director, officer or stockholder of the Corporation to the Corporation or to the Corporation’s stockholders, (iii) any action, suit or proceeding arising pursuant to any provision of the DGCL or the bylaws of the Corporation or this Certificate of Incorporation (as either may be amended from time to time) or (iv) any action, suit or proceeding asserting a claim against the Corporation governed by the internal affairs doctrine; and (b) subject to the preceding provisions of this Article XI, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended. If any action the subject matter of which is within the scope of clause (a) of the immediately preceding sentence is filed in a court other than the courts in the
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State of Delaware (a “Foreign Action”) in the name of any stockholder, such stockholder shall be deemed to have consented to (x) the personal jurisdiction of the state and federal courts in the State of Delaware in connection with any action brought in any such court to enforce the provisions of clause (a) of the immediately preceding sentence and (y) having service of process made upon such stockholder in any such action by service upon such stockholder’s counsel in the Foreign Action as agent for such stockholder.
Any person or entity purchasing or otherwise acquiring any interest in any security of the Corporation shall be deemed to have notice of and consented to this Article XII. Notwithstanding the foregoing, the provisions of this Article XII shall not apply to suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts of the United States have exclusive jurisdiction.
If any provision or provisions of this Article XII shall be held to be invalid, illegal or unenforceable as applied to any circumstance for any reason whatsoever, (a) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Article XII (including, without limitation, each portion of any paragraph of this Article XII containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and (b) the application of such provision to other persons or entities and circumstances shall not in any way be affected or impaired thereby.
ARTICLE XII.
Section 12.1 Section 203 of the DGCL. The Corporation expressly elects not to be governed by Section 203 of the DGCL and the restrictions and limitations set forth therein.
Section 12.2 Interested Stockholder Transactions. Notwithstanding anything to the contrary set forth in this Certificate of Incorporation, the Corporation shall not engage in any Business Combination (as defined below) at any point in time at which the Corporation’s Class A Common Stock and Class B Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act with any Interested Stockholder (as defined below) for a period of three (3) years following the time that such stockholder became an Interested Stockholder, unless:
(a) prior to such time that such stockholder became an Interested Stockholder, the Board of Directors approved either the Business Combination or the transaction which resulted in such stockholder becoming an Interested Stockholder; or
(b) upon consummation of the transaction which resulted in the stockholder becoming an Interested Stockholder, the Interested Stockholder owned at least 85% of the voting stock (as defined below) of the Corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock owned by the Interested Stockholder) those shares owned by (i) persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
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(c) at or subsequent to such time that such stockholder became an Interested Stockholder, the Business Combination is approved by the Board of Directors and authorized at an annual or special meeting of stockholders , and not by written consent, by the affirmative vote of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the outstanding shares of capital stock of the Corporation which is not owned by such Interested Stockholder.
Section 12.3 Definitions. As used in this Certificate of Incorporation, the following terms shall have the following meaning:
(a) “Affiliate” means a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, another Person;
(b) “Associate”, when used to indicate a relationship with any Person, means: (i) any corporation, partnership, unincorporated association or other entity of which such Person is a director, officer or partner or is, directly or indirectly, the owner of twenty percent (20%) or more of any class of shares of voting stock of the Corporation; (ii) any trust or other estate in which such Person has at least a twenty percent (20%) beneficial interest or as to which such Person serves as trustee or in a similar fiduciary capacity; and (iii) any relative or spouse of such Person, or any relative of such spouse, who has the same residence as such Person.
(c) “Business Combination” means (i) any merger or consolidation of the Corporation or any direct or indirect majority-owned subsidiary of the Corporation with an Interested Stockholder or (ii) any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), except proportionately as a stockholder of the Corporation, to or with an Interested Stockholder, whether as part of a dissolution or otherwise, of assets of the Corporation or of any direct or indirect majority-owned subsidiary of the Corporation which assets have an aggregate market value equal to ten percent (10%) or more of either the aggregate market value of all the assets of the Corporation determined on a consolidated basis or the aggregate market value of all the outstanding shares of capital stock of the Corporation.
(d) “Change of Control” means the occurrence of any of the following events: (1) any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of the Exchange Act, but excluding any employee benefit plan of such person and its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) becomes the “beneficial owner” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of shares of Class A Common Stock, Class B Common Stock, Preferred Stock and/or any other class or classes of capital stock of the Corporation (if any) representing in the aggregate more than fifty percent (50%) of the voting power of all of the outstanding shares of capital stock of the Corporation entitled to vote; (2) the stockholders of the Corporation approve a plan of complete liquidation or dissolution of the Corporation or there is consummated a transaction or series of related transactions for the sale, lease, exchange or other disposition, directly or indirectly, by the Corporation of all or substantially all of the Corporation’s assets (including a sale of all or substantially all of the assets of BIG LLC); (3) there is consummated a merger or consolidation of the Corporation with any other corporation or entity, and, immediately after the consummation of such merger or consolidation, the voting securities of the Corporation
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immediately prior to such merger or consolidation do not continue to represent, or are not converted into, voting securities representing more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the Person resulting from such merger or consolidation or, if the surviving company is a subsidiary, the ultimate parent thereof; or (4) the Corporation ceases to be the sole managing member of BIG LLC; provided, however, that a “Change of Control” shall not be deemed to have occurred by virtue of the consummation of any transaction or series of related transactions immediately following which the beneficial owners of the Class A Common Stock, Class B Common Stock, Preferred Stock and/or any other class or classes of capital stock of the Corporation immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in and voting control over, and own substantially all of the shares of, an entity which owns all or substantially all of the assets of the Corporation immediately following such transaction or series of transactions.
(e) “Control,” including the terms “controlling,” “controlled by” and “under common control with,” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting stock, by contract or otherwise. A Person who is the owner of 20% or more of the outstanding voting stock of any corporation, partnership, unincorporated association or other entity shall be presumed to have control of such entity, in the absence of proof by a preponderance of the evidence to the contrary. Notwithstanding the foregoing, a presumption of control shall not apply where such Person holds voting stock, in good faith and not for the purpose of circumventing this section, as an agent, bank, broker, nominee, custodian or trustee for one or more owners who do not individually or as a group have control of such entity.
(f) “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and any applicable rules and regulations promulgated thereunder, and any successor to such statute, rules or regulations.
(g) “Interested Stockholder” means any Person (other than the Corporation and any direct or indirect majority-owned subsidiary of the Corporation and Robert Morse and his Affiliates and Associates) that (i) is the beneficial owner of fifteen percent (15%) or more of the outstanding shares of capital stock of the Corporation that are entitled to vote, or (ii) is an Affiliate of the Corporation and was the beneficial owner of fifteen percent (15%) or more of the outstanding shares of capital stock of the Corporation that are entitled to vote at any time within the three-year period immediately prior to the date on which it is sought to be determined whether such Person is an Interested Stockholder, and the Affiliates and Associates of such Person.
(h) “owner,” including the terms “own” and “owned,” when used with respect to any stock, means a Person that individually or with or through any of its Affiliates or associates:
(i) beneficially owns such stock, directly or indirectly; or
(ii) has (a) the right to acquire such stock (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding, or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise; provided, however, that a Person shall not be deemed the owner of stock tendered pursuant to a tender or exchange offer made by such person or any of such Person’s Affiliates or
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associates until such tendered stock is accepted for purchase or exchange; or (b) the right to vote such stock pursuant to any agreement, arrangement or understanding; provided, however, that a Person shall not be deemed the owner of any stock because of such Person’s right to vote such stock if the agreement, arrangement or understanding to vote such stock arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made to ten or more Persons; or
(iii) has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting (except voting pursuant to a revocable proxy or consent as described in item (b) of subsection (ii) above), or disposing of such stock with any other Person that beneficially owns, or whose Affiliates or Associates beneficially own, directly or indirectly, such stock.
(i) “Person” means, except as otherwise provided in the definition of “Change of Control”, any individual, corporation, partnership, limited liability company, unincorporated association or other entity.
(j) “Securities Act” means the U.S. Securities Act of 1933, as amended, and applicable rules and regulations promulgated thereunder, and any successor to such statute, rules or regulations.
(k) “stock” means, with respect to any corporation, capital stock and, with respect to any other entity, any equity interest.
(l) “voting stock” means stock of any class or series entitled to vote generally in the election of directors and, with respect to any entity that is not a corporation, any equity interest entitled to vote generally in the election of the governing body of such entity. Every reference to a percentage of voting stock shall refer to such percentages of the votes of such voting stock.
ARTICLE XIII.
If any provision or provisions of this Certificate of Incorporation shall be held to be invalid, illegal or unenforceable as applied to any Person or circumstance for any reason whatsoever, then, to the fullest extent permitted by law, the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Certificate of Incorporation (including, without limitation, each portion of any sentence of this Certificate of Incorporation containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) and the application of such provision to other Persons and circumstances shall not in any way be affected or impaired thereby.
* *
This Certificate of Incorporation shall be effective as of 12:20 a.m. ET on July 16, 2021.
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IN WITNESS WHEREOF, the Corporation has caused this Amended and Restated Certificate of Incorporation to be signed on this July 15, 2021.
| BRIDGE INVESTMENT GROUP HOLDINGS INC. | ||
| By: |
/s/ Jonathan Slager |
|
| Name: | Jonathan Slager | |
| Title: | Chief Executive Officer | |
CONTENTS
| Page | ||||||
| Article I. Meetings of Stockholders | 1 | |||||
| Section 1.01 |
Place of Meetings |
1 | ||||
| Section 1.02 |
Annual Meetings |
1 | ||||
| Section 1.03 |
Special Meetings |
1 | ||||
| Section 1.04 |
Notice of Meetings |
1 | ||||
| Section 1.05 |
Adjournments |
2 | ||||
| Section 1.06 |
Quorum |
2 | ||||
| Section 1.07 |
Organization |
2 | ||||
| Section 1.08 |
Voting; Proxies |
2 | ||||
| Section 1.09 |
Fixing Date for Determination of Stockholders of Record |
3 | ||||
| Section 1.10 |
List of Stockholders Entitled to Vote |
4 | ||||
| Section 1.11 |
Inspectors of Election |
4 | ||||
| Section 1.12 |
Conduct of Meetings |
5 | ||||
| Section 1.13 |
Advance Notice Procedures for Business Brought Before a Meeting |
5 | ||||
| Section 1.14 |
Advance Notice Procedures for Nominations of Directors |
9 | ||||
|
Article II. Board of Directors |
13 | |||||
| Section 2.01 |
Number; Tenure; Qualifications |
13 | ||||
| Section 2.02 |
Election; Resignation; Removal; Vacancies |
13 | ||||
| Section 2.03 |
Regular Meetings |
13 | ||||
| Section 2.04 |
Special Meetings |
13 | ||||
| Section 2.05 |
Telephonic Meetings Permitted |
13 | ||||
| Section 2.06 |
Quorum; Vote Required for Action |
14 | ||||
| Section 2.07 |
Organization |
14 | ||||
| Section 2.08 |
Action by Unanimous Consent of Directors |
14 | ||||
| Section 2.09 |
Compensation of Directors |
14 | ||||
| Section 2.10 |
Chairpersons |
14 | ||||
|
Article III. Committees |
15 | |||||
| Section 3.01 |
Committees |
15 | ||||
| Section 3.02 |
Committee Minutes |
15 | ||||
| Section 3.03 |
Committee Rules |
15 | ||||
| Article IV. Officers | 15 | |||||
| Section 4.01 |
Officers |
15 | ||||
| Section 4.02 |
Appointment of Officers |
16 | ||||
| Section 4.03 |
Subordinate Officer |
16 | ||||
| Section 4.04 |
Removal and Resignation of Officers |
16 | ||||
| Section 4.05 |
Vacancies in Offices |
16 | ||||
| Section 4.06 |
Chief Executive Officer |
16 | ||||
| Section 4.07 |
President |
16 | ||||
| Section 4.08 |
Secretary |
17 | ||||
| Section 4.09 |
Chief Financial Officer |
17 | ||||
| Section 4.10 |
Representation of Shares of Other Entities |
17 | ||||
| Section 4.11 |
Authority and Duties of Officers |
17 | ||||
| Section 4.12 |
Compensation |
17 | ||||
| Article V. Stock | 18 | |||||
| Section 5.01 |
Certificates |
18 | ||||
| Section 5.02 |
Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates |
18 | ||||
| Article VI. Indemnification and Advancement of Expenses | 18 | |||||
| Section 6.01 |
Right to Indemnification |
18 | ||||
| Section 6.02 |
Indemnification of Others |
18 | ||||
| Section 6.03 |
Advancement of Expenses |
19 | ||||
| Section 6.04 |
Claims |
19 | ||||
| Section 6.05 |
Non-exclusivity of Rights |
19 | ||||
| Section 6.06 |
Insurance |
19 | ||||
| Section 6.07 |
Other Sources |
19 | ||||
| Section 6.08 |
Continuation of Indemnification |
20 | ||||
| Section 6.09 |
Amendment or Repeal |
20 | ||||
| Section 6.10 |
Other Indemnification and Advancement of Expenses |
20 | ||||
| Article VII. Miscellaneous | 20 | |||||
| Section 7.01 |
Fiscal Year |
20 | ||||
| Section 7.02 |
Seal |
20 | ||||
| Section 7.03 |
Dividends |
20 | ||||
| Section 7.04 |
Registered Stockholders |
20 | ||||
| Section 7.05 |
Corporate Seal |
21 | ||||
| Section 7.06 |
Construction; Definitions |
21 | ||||
| Section 7.07 |
Manner of Notice |
21 | ||||
| Section 7.08 |
Waiver of Notice of Meetings of Stockholders, Directors and Committees |
22 | ||||
| Section 7.09 |
Form of Records |
22 | ||||
| Section 7.10 |
Amendment of Bylaws |
22 | ||||
ii
ARTICLE I.
MEETINGS OF STOCKHOLDERS
Section 1.01 Place of Meetings. Meetings of stockholders of Bridge Investment Group Holdings Inc., a Delaware corporation (the “Corporation”; and such stockholders, the “Stockholders”), may be held at any place, within or without the State of Delaware, as may be designated by or in the manner determined by the board of directors of the Corporation (the “Board of Directors”). In the absence of such designation, meetings of Stockholders shall be held at the principal executive office of the Corporation. The Board of Directors may, in its sole discretion, determine that a meeting of Stockholders shall not be held at any place, but may instead be held solely by means of remote communication authorized by and in accordance with Section 211(a) of the General Corporation Law of the State of Delaware (the “DGCL”).
Section 1.02 Annual Meetings. The annual meeting of Stockholders shall be held for the election of directors at such date and time as may be designated by or in the manner determined by resolution of the Board of Directors from time to time. Any other business as may be properly brought before the annual meeting may be transacted at the annual meeting. The Board of Directors may postpone, reschedule or cancel any annual meeting of Stockholders previously scheduled by the Board of Directors.
Section 1.03 Special Meetings. Special meetings of Stockholders for any purpose or purposes may be called only by a chairperson of the Board of Directors (a “Chairperson”) or pursuant to a resolution adopted by a majority of the Board of Directors then in office. Special meetings validly called in accordance with this Section 1.03 of these amended and restated bylaws (as the same may be further amended, restated, amended and restated or otherwise modified from time to time, these “Bylaws”) may be held at such date and time as specified in the applicable notice. Notice of every special meeting shall state the purpose or purposes of the meeting, and the business transacted at any special meeting of Stockholders shall be limited to the purpose or purposes stated in the notice. The Board of Directors may postpone, reschedule or cancel any special meeting of Stockholders previously scheduled by a Chairperson or the Board of Directors.
Section 1.04 Notice of Meetings. Whenever Stockholders are required or permitted to take any action at a meeting, a notice of the meeting shall be given that shall state the place, if any, date and hour of the meeting, the means of remote communications, if any, by which Stockholders and proxy holders may be deemed to be present in person and vote at such meeting, the record date for determining the Stockholders entitled to vote at the meeting (if such date is different from the record date for Stockholders entitled to notice of the meeting) and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Unless otherwise required by law, the Amended and Restated Certificate of Incorporation of the Corporation (as the same may be further amended, restated, amended and restated or otherwise modified from time to time, the “Certificate of Incorporation”) or these Bylaws, the notice of any meeting shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each Stockholder entitled to vote at the meeting as of the record date for determining the Stockholders entitled to notice of the meeting. If mailed, such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the Stockholder at such Stockholder’s address as it appears on the records of the Corporation.
Section 1.05 Adjournments. Any meeting of Stockholders, annual or special, may be adjourned from time to time by the chairperson of the meeting (or by the Stockholders in accordance with Section 1.06) to reconvene at the same or some other place, if any, and the same or some other time, and notice need not be given of any such adjourned meeting if the time and place, if any, thereof, and the means of remote communications, if any, by which Stockholders and proxy holders may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken. At the adjourned meeting, the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, a notice of the adjourned meeting shall be given to each Stockholder of record entitled to vote at the meeting. If after the adjournment a new record date for determination of Stockholders entitled to vote is fixed for the adjourned meeting, the Board of Directors shall fix a new record date for determining Stockholders entitled to notice of such adjourned meeting in accordance with Section 1.09(a) of these Bylaws, and shall give notice of the adjourned meeting to each Stockholder of record entitled to vote at such adjourned meeting as of the record date fixed for notice of such adjourned meeting.
Section 1.06 Quorum. At any meeting of the Stockholders, the holders of a majority of the voting power of the outstanding shares of capital stock of the Corporation (“Stock”) entitled to vote at the meeting, present in person or by proxy, shall constitute a quorum for all purposes, unless or except to the extent that the presence of a larger number may be required by law, the rules of any stock exchange upon which the Corporation’s securities are listed, the Certificate of Incorporation or these Bylaws. In the absence of a quorum, then either (i) the chairperson of the meeting or (ii) if the Board of Directors so determines, the Stockholders by the affirmative vote of a majority of the voting power of the outstanding shares of capital Stock entitled to vote thereon, present in person or represented by proxy, shall have the power to adjourn the meeting from time to time in the manner provided in Section 1.05 of these Bylaws until a quorum is present or represented. Where a separate vote by a class or classes or series of Stock is required by law or the Certificate of Incorporation, the holders of a majority of voting power of the shares of such class or classes or series of Stock issued and outstanding and entitled to vote on such matter, present in person or represented by proxy, shall constitute a quorum entitled to take action with respect to the vote on such matter. A quorum, once established at a meeting, shall not be broken by the withdrawal of enough votes to leave less than a quorum.
Section 1.07 Organization. Meetings of Stockholders shall be presided over by a Chairperson or by such other officer or director of the Corporation as designated by the Board of Directors or a Chairperson, or in the absence of such person or designation, by a chairperson chosen at the meeting by the affirmative vote of a majority of the voting power of Stock present or represented at the meeting and entitled to vote at the meeting (provided there is a quorum). The Secretary of the Corporation (the “Secretary”) shall act as secretary of the meeting, but in his or her absence the chairperson of the meeting may appoint any person to act as secretary of the meeting.
Section 1.08 Voting; Proxies. Each Stockholder entitled to vote at any meeting of Stockholders shall be entitled to the number of votes, if any, for each share of Stock held of record by such Stockholder which has voting power upon the matter in question that is set forth in the Certificate of Incorporation or, if such voting power is not set forth in the Certificate of Incorporation, one vote per share. Each Stockholder entitled to vote at a meeting of Stockholders
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or express consent to corporate action without a meeting (if permitted by the Certificate of Incorporation) may authorize another person or persons to act for such Stockholder by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A proxy may be authorized by an instrument in writing or by a transmission permitted by law and shall be filed in accordance with the procedure established for the meeting. A proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A Stockholder may revoke any proxy which is not irrevocable by attending the meeting and voting in person (including by means of remote communication, if applicable) or by delivering to the Secretary a revocation of the proxy or a new proxy bearing a later date. Voting at meetings of Stockholders need not be by written ballot. Unless otherwise provided in the Certificate of Incorporation, at all meetings of Stockholders for the election of directors at which a quorum is present a plurality of the votes cast shall be sufficient to elect directors. No holder of shares of Stock shall have the right to cumulate votes. All other elections and questions presented to the Stockholders at a meeting at which a quorum is present shall be decided by the affirmative vote of the holders of a majority of votes cast (excluding abstentions and broker non-votes) on such matter, unless a different or minimum vote is required by the Certificate of Incorporation, these Bylaws, the rules or regulations of any stock exchange applicable to the Corporation, or applicable law or pursuant to any regulation applicable to the Corporation or its securities in which case such different or minimum vote shall be the applicable vote on the matter.
Section 1.09 Fixing Date for Determination of Stockholders of Record.
(a) In order that the Corporation may determine the Stockholders entitled to notice of any meeting of Stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall, unless otherwise required by law, not be more than sixty (60) nor less than ten (10) days before the date of such meeting. If the Board of Directors so fixes a date, such date shall also be the record date for determining the Stockholders entitled to vote at such meeting unless the Board of Directors determines, at the time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination. If no record date is fixed by the Board of Directors, the record date for determining Stockholders entitled to notice of and to vote at a meeting of Stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of Stockholders of record entitled to notice of or to vote at a meeting of Stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for determination of Stockholders entitled to vote at the adjourned meeting, and in such case shall also fix as the record date for Stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of Stockholders entitled to vote in accordance with the foregoing provisions of Section 1.09(a) at the adjourned meeting.
(b) In order that the Corporation may determine the Stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of Stock or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede
3
the date upon which the resolution fixing the record date is adopted, and which record date shall not be more than sixty (60) days prior to such action. If no such record date is fixed, the record date for determining Stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.
(c) Unless otherwise restricted by the Certificate of Incorporation, in order that the Corporation may determine the Stockholders entitled to consent to corporate action without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than ten (10) days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. If no record date for determining Stockholders entitled to consent to corporate action in writing without a meeting is fixed by the Board of Directors, (i) when no prior action of the Board of Directors is required by law or the Certificate of Incorporation, the record date for such purpose shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation in accordance with applicable law and (ii) if prior action by the Board of Directors is required by law or the Certificate of Incorporation, the record date for such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.
Section 1.10 List of Stockholders Entitled to Vote. The Corporation shall prepare, at least ten (10) days before every meeting of Stockholders, a complete list of the Stockholders entitled to vote at the meeting (provided, however, if the record date for determining the Stockholders entitled to vote is less than ten (10) days before the date of the meeting, the list shall reflect the Stockholders entitled to vote as of the tenth (10th) day before the meeting date), arranged in alphabetical order, and showing the address of each Stockholder and the number of shares registered in the name of each Stockholder as of the record date (or such other date). Such list shall be open to the examination of any Stockholder, for any purpose germane to the meeting at least ten (10) days prior to the meeting (i) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting or (ii) during ordinary business hours at the principal place of business of the Corporation. If the meeting is to be held at a place, then a list of Stockholders entitled to vote at the meeting shall be produced and kept at the time and place of the meeting during the whole time thereof and may be examined by any Stockholder who is present. If the meeting is to be held solely by means of remote communication, then the list shall also be open to the examination of any Stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting. Except as otherwise provided by law, the “stock ledger” shall be the only evidence as to who are the Stockholders entitled to examine the list of Stockholders required by this Section 1.10 or to vote in person or by proxy at any meeting of Stockholders. For purposes of these Bylaws, the term “stock ledger” means one or more records administered by or on behalf of the Corporation in which the names of all of the Corporation’s Stockholders of record, the address and number of shares registered in the name of each such Stockholder, and all issuances and transfers of stock of the Corporation are recorded.
Section 1.11 Inspectors of Election. The Corporation may, and shall if required by law, in advance of any meeting of Stockholders, appoint one or more inspectors of election, who may be employees of the Corporation, to act at the meeting or any adjournment thereof and to make a
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written report thereof. The Corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. In the event that no inspector so appointed or designated is able to act at a meeting of Stockholders, the person presiding at the meeting may, and to the extent required by law, shall appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his or her duties, shall take and sign an oath to execute faithfully the duties of inspector with strict impartiality and according to the best of his or her ability. Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein. The inspector or inspectors so appointed or designated shall (i) ascertain the number of shares of Stock outstanding and the voting power of each such share, (ii) determine the shares of Stock represented at the meeting and the validity of proxies and ballots, (iii) count all votes and ballots, (iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors, and (v) certify their determination of the number of shares of Stock represented at the meeting and such inspectors’ count of all votes and ballots. Such certification and report shall specify such other information as may be required by law. In determining the validity and counting of proxies and ballots cast at any meeting of Stockholders, the inspectors may consider such information as is permitted by applicable law. No person who is a candidate for an office at an election may serve as an inspector at such election.
Section 1.12 Conduct of Meetings. The date and time of the opening and the closing of the polls for each matter upon which the Stockholders will vote at a meeting shall be announced at the meeting by the person presiding over the meeting designated in accordance with Section 1.07 of these Bylaws. After the polls close, no ballots, proxies or votes or any revocations or changes thereto may be accepted. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of Stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the person presiding over any meeting of Stockholders shall have the right and authority to convene and (for any or no reason) to recess and/or adjourn the meeting, to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such presiding person, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the presiding person of the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to Stockholders entitled to vote at the meeting, their duly authorized and constituted proxies or such other persons as the presiding person of the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. The presiding person at any meeting of Stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall, if the facts warrant, determine and declare to the meeting that a matter or business was not properly brought before the meeting and if such presiding person should so determine, such presiding person shall so declare to the meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered. Unless and to the extent determined by the Board of Directors or the person presiding over the meeting, meetings of Stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.
Section 1.13 Advance Notice Procedures for Business Brought before a Meeting. This Section 1.13 shall apply to any business that may be brought before an annual meeting of
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Stockholders other than nominations for election to the Board of Directors at such a meeting, which shall be governed by Section 1.14 of these Bylaws. Stockholders seeking to nominate Persons for election to the Board of Directors must comply with Section 1.14 of these Bylaws, and this Section 1.13 shall not be applicable to nominations for election to the Board of Directors except as expressly provided in Section 1.14 of these Bylaws.
(a) At an annual meeting of the Stockholders, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting, business must be (a) specified in a notice of meeting given by or at the direction of the Board of Directors or a duly authorized committee thereof, (b) if not specified in a notice of meeting, otherwise brought before the meeting by the Board of Directors or the chairperson of the meeting, or (c) otherwise properly brought before the meeting by a Stockholder present in person who (A)(1) was a Stockholder of record of the Corporation both at the time of giving the notice provided for in this Section 1.13 and at the time of the meeting, (2) is entitled to vote at the meeting and (3) has complied with this Section 1.13 or (B) properly made such proposal in accordance with Rule 14a-8 under the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder (as so amended and inclusive of such rules and regulations, the “Exchange Act”), which proposal has been included in the proxy statement for the annual meeting. The foregoing clause (c) shall be the exclusive means for a Stockholder to propose business to be brought before an annual meeting of the Stockholders. The only matters that may be brought before a special meeting are the matters specified in the Corporation’s notice of meeting given by or at the direction of the Person calling the meeting pursuant to the Certificate of Incorporation and Section 1.03 of these Bylaws. For purposes of these Bylaws, “Person” shall mean any individual, general partnership, limited partnership, limited liability company, corporation, trust, business trust, joint stock company, joint venture, unincorporated association, cooperative or association or any other legal entity or organization of whatever nature, and shall include any successor (by merger or otherwise) of such entity. For purposes of this Section 1.13 and Section 1.14 of these Bylaws, “present in person” shall mean that the Stockholder proposing that the business be brought before the annual meeting or special meeting of the Corporation, as applicable, or, if the proposing Stockholder is not an individual, a qualified representative of such proposing Stockholder, appears in person at such annual meeting, and a “qualified representative” of such proposing Stockholder shall be, if such proposing Stockholder is (x) a general or limited partnership, any general partner or Person who functions as a general partner of the general or limited partnership or who controls the general or limited partnership, (y) a corporation or a limited liability company, any officer or Person who functions as an officer of the corporation or limited liability company or any officer, director, general partner or Person who functions as an officer, director or general partner of any entity ultimately in control of the corporation or limited liability company or (z) a trust, any trustee of such trust.
(b) Without qualification, for business to be properly brought before an annual meeting by a Stockholder, the Stockholder must (a) provide Timely Notice (as defined below) thereof in writing and in proper form to the Secretary of the Corporation and (b) provide any updates or supplements to such notice at the times and in the forms required by this Section 1.13. To be timely, a Stockholder’s notice must be delivered to, or mailed and received at, the principal executive offices of the Corporation not less than ninety (90) days nor more than one hundred twenty (120) days prior to the one-year anniversary of the preceding year’s annual meeting (which, in the case of the first annual meeting of stockholders following the closing the
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Corporation’s initial underwritten public offering of common stock, the preceding year’s annual meeting date shall be deemed to be June 1, 2021); provided, however, that if the date of the annual meeting is more than thirty (30) days before or more than sixty (60) days after such anniversary date, notice by the Stockholder to be timely must be so delivered, or mailed and received, not later than the ninetieth (90th) day prior to such annual meeting or, if later, the tenth (10th) day following the day on which public disclosure of the date of such annual meeting was first made (such notice within such time periods, “Timely Notice”). In no event shall any adjournment or postponement of an annual meeting or the announcement thereof commence a new time period for the giving of Timely Notice as described above.
(c) To be in proper form for purposes of this Section 1.13, a Stockholder’s notice to the Secretary shall set forth:
(i) As to each Proposing Person (as defined below), (A) the name and address of such Proposing Person (including, if applicable, the name and address that appear on the Corporation’s books and records); and (B) the number of shares of each class or series of Stock of the Corporation that are, directly or indirectly, owned of record or beneficially owned (within the meaning of Rule 13d-3 under the Exchange Act) by such Proposing Person, except that such Proposing Person shall in all events be deemed to beneficially own any shares of any class or series of Stock of the Corporation as to which such Proposing Person has a right to acquire beneficial ownership at any time in the future (the disclosures to be made pursuant to the foregoing clauses (A) and (B) are referred to as “Stockholder Information”);
(ii) As to each Proposing Person, (A) the full notional amount of any securities that, directly or indirectly, underlie any “derivative security” (as such term is defined in Rule 16a-1(c) under the Exchange Act) that constitutes a “call equivalent position” (as such term is defined in Rule 16a-1(b) under the Exchange Act) (“Synthetic Equity Position”) and that is, directly or indirectly, held or maintained by such Proposing Person with respect to any shares of any class or series of Stock of the Corporation; provided that, for the purposes of the definition of “Synthetic Equity Position,” the term “derivative security” shall also include any security or instrument that would not otherwise constitute a “derivative security” as a result of any feature that would make any conversion, exercise or similar right or privilege of such security or instrument becoming determinable only at some future date or upon the happening of a future occurrence, in which case the determination of the amount of securities into which such security or instrument would be convertible or exercisable shall be made assuming that such security or instrument is immediately convertible or exercisable at the time of such determination; and, provided, further, that any Proposing Person satisfying the requirements of Rule 13d-1(b)(1) under the Exchange Act (other than a Proposing Person that so satisfies Rule 13d-1(b)(1) under the Exchange Act solely by reason of Rule 13d-1(b)(1)(ii)(E)) shall not be deemed to hold or maintain the notional amount of any securities that underlie a Synthetic Equity Position held by such Proposing Person as a hedge with respect to a bona fide derivatives trade or position of such Proposing Person arising in the ordinary course of such Proposing Person’s business as a derivatives dealer, (B) any rights to dividends on the shares of any class or series of Stock of the Corporation owned beneficially by such Proposing Person that are separated or separable from the underlying shares of the Corporation, (C) any material
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pending or threatened legal proceeding in which such Proposing Person is a party or material participant involving the Corporation or any of its officers or directors, or any affiliate of the Corporation, (D) any other material relationship between such Proposing Person, on the one hand, and the Corporation or any affiliate of the Corporation, on the other hand, (E) any direct or indirect material interest in any material contract or agreement of such Proposing Person with the Corporation or any affiliate of the Corporation (including, in any such case, any employment agreement, collective bargaining agreement or consulting agreement) and (F) any other information relating to such Proposing Person that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies or consents by such Proposing Person in support of the business proposed to be brought before the meeting pursuant to Section 14(a) of the Exchange Act (the disclosures to be made pursuant to the foregoing clauses (A) through (F) are referred to as “Disclosable Interests”); provided, however, that Disclosable Interests shall not include any such disclosures with respect to the ordinary course business activities of any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the stockholder directed to prepare and submit the notice required by these Bylaws on behalf of a beneficial owner; and
(iii) As to each item of business that the Stockholder proposes to bring before the annual meeting, (A) a brief description of the business desired to be brought before the annual meeting, the reasons for conducting such business at the annual meeting and any material interest in such business of each Proposing Person, (B) the text of the proposal or business (including the text of any resolutions proposed for consideration and the text of any proposed amendment to these Bylaws), (C) a reasonably detailed description of all agreements, arrangements and understandings (x) between or among any of the Proposing Persons or (y) between or among any Proposing Person and any other Person or entity (including their names) in connection with the proposal of such business by such stockholder and (D) any other information relating to such item of business that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies in support of the business proposed to be brought before the meeting pursuant to Section 14(a) of the Exchange Act; provided, however, that the disclosures required by this Section 1.13(c) shall not include any disclosures with respect to any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the Stockholder directed to prepare and submit the notice required by these Bylaws on behalf of a beneficial owner.
(d) For purposes of this Section 1.13, the term “Proposing Person” shall mean (a) the Stockholder providing the notice of business proposed to be brought before an annual meeting, (b) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the business proposed to be brought before the annual meeting is made, (c) any participant (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A) with such Stockholder in such solicitation.
(e) A Proposing Person shall update and supplement its notice to the Corporation of its intent to propose business at an annual meeting, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 1.13 shall be true and correct as of the record date for notice of the meeting and as of the date that is ten (10) business days prior to
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the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for notice of the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight (8) business days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof).
(f) Notwithstanding anything in these Bylaws to the contrary, no business shall be conducted at an annual meeting that is not properly brought before the meeting in accordance with this Section 1.13. The presiding officer of the meeting shall, if the facts warrant, determine that the business was not properly brought before the meeting in accordance with this Section 1.13, and if he or she should so determine, he or she shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted.
(g) In addition to the requirements of this Section 1.13 with respect to any business proposed to be brought before an annual meeting, each Proposing Person shall comply with all applicable requirements of the Exchange Act with respect to any such business. Nothing in this Section 1.13 shall be deemed to affect the rights of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act.
(h) For purposes of these Bylaws, “public disclosure” shall mean disclosure in a press release reported by a national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act.
Section 1.14 Advance Notice Procedures for Nominations of Directors.
(a) Nominations of any Person for election to the Board of Directors at an annual meeting or at a special meeting (but only if the election of directors is a matter specified in the notice of meeting given by or at the direction of the person calling such special meeting) may be made at such meeting only (a) as provided in the Stockholders Agreement (as defined below), (b) by or at the direction of the Board of Directors, including by any committee or Persons authorized to do so by the Board of Directors or these Bylaws, or (c) by a Stockholder present in person (as defined in Section 1.13) (1) who was a Stockholder of record of the Corporation both at the time of giving the notice provided for in this Section 1.14 and at the time of the meeting, (2) is entitled to vote at the meeting and (3) has complied with this Section 1.14 as to such notice and nomination. Other than as provided in the Stockholders Agreement, the foregoing clause (c) shall be the exclusive means for a Stockholder to make any nomination of a Person or Persons for election to the Board of Directors at any annual meeting or special meeting of Stockholders.
(i) Without qualification, for a Stockholder to make any nomination of a Person or Persons for election to the Board of Directors at an annual meeting, the Stockholder must (a) provide Timely Notice (as defined in Section 1.13(b) of these Bylaws) thereof in writing and in proper form to the Secretary at the principal executive
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offices of the Corporation, (b) provide the information, agreements and questionnaires with respect to such Stockholder and its candidate for nomination as required by this Section 1.14, and (c) provide any updates or supplements to such notice at the times and in the forms required by this Section 1.14.
(ii) Without qualification, if the election of directors is a matter specified in the notice of meeting given by or at the direction of the person calling a special meeting, then for a Stockholder to make any nomination of a person or persons for election to the Board of Directors at a special meeting, the Stockholder must (a) provide timely notice thereof in writing and in proper form to the Secretary at the principal executive offices of the Corporation, (b) provide the information, agreements and questionnaires with respect to such Stockholder and its candidate for nomination required by this Section 1.14, and (c) provide any updates or supplements to such notice at the times and in the forms required by this Section 1.14. To be timely for purposes of this Section 1.14(b)(ii), a Stockholder’s notice for nominations to be made at a special meeting must be delivered to, or mailed to and received by the Secretary of the Corporation not earlier than the one hundred twentieth (120th) day prior to such special meeting and not later than the ninetieth (90th) day prior to such special meeting or, if later, the tenth (10th) day following the day on which public disclosure (as defined in Section 1.13(h)) of the date of such special meeting was first made.
(iii) In no event shall any adjournment or postponement of an annual meeting or special meeting or the announcement thereof commence a new time period for the giving of a Stockholder’s notice as described above.
(iv) In no event may a Nominating Person (as defined below) provide notice under this Section 1.14 or otherwise with respect to a greater number of director candidates than are subject to election by Stockholders at the applicable meeting. If the Corporation shall, subsequent to such notice, increase the number of directors subject to election at the meeting, such notice as to any additional nominees shall be due on the later of (i) the conclusion of the time period for Timely Notice (with respect to an annual meeting), (ii) the date set forth in Section 1.14(b)(ii) (with respect to a special meeting) or (iii) the tenth (10th) day following the date of public disclosure (as defined in Section 1.13(h)) of such increase.
(b) To be in proper form for purposes of this Section 1.14, a Stockholder’s notice to the Secretary shall set forth:
(i) As to each Nominating Person, the Stockholder Information (as defined in Section 1.13(c)(i) of these Bylaws) except that for purposes of this Section 1.14, the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Section 1.13(c)(i);
(ii) As to each Nominating Person, any Disclosable Interests (as defined in Section 1.13(c)(ii), except that for purposes of this Section 1.14 the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Section 1.13(c)(ii) and the disclosure with respect to the business to be brought before the meeting in Section 1.13(c)(iii) shall be made with respect to nomination of each Person for election as a director at the meeting); and
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(iii) As to each candidate whom a Nominating Person proposes to nominate for election as a director, (A) all information with respect to such candidate for nomination that would be required to be set forth in a Stockholder’s notice pursuant to this Section 1.14 if such candidate for nomination were a Nominating Person, (B) all information relating to such candidate for nomination that is required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to Section 14(a) under the Exchange Act (including such candidate’s written consent to being named in the Corporation’s proxy statement as a nominee and to serving as a director if elected), (C) a description of any direct or indirect material interest in any material contract or agreement between or among any Nominating Person, on the one hand, and each candidate for nomination or any other participants in such solicitation, on the other hand, including, without limitation, all information that would be required to be disclosed pursuant to Item 404 under Regulation S-K if such Nominating Person were the “registrant” for purposes of such rule and the candidate for nomination were a director or executive officer of such registrant (the disclosures to be made pursuant to the foregoing clauses (A) through (C) are referred to as “Nominee Information”), and (D) a completed and signed questionnaire, representation and agreement as provided in Section 1.14(f).
(c) For purposes of this Section 1.14, the term “Nominating Person” shall mean (a) the Stockholder providing the notice of the nomination proposed to be made at the meeting, (b) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the nomination proposed to be made at the meeting is made and (c) any other participant in such solicitation.
(d) A Stockholder providing notice of any nomination proposed to be made at a meeting shall further update and supplement such notice, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 1.14 shall be true and correct as of the record date for notice of the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for notice of the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight (8) business days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof).
(e) To be eligible to be a candidate for election as a director of the Corporation at an annual or special meeting, a candidate must be nominated in the manner prescribed in this Section 1.14 and the candidate for nomination, whether nominated by the Board of Directors or
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by a Stockholder of record, must have previously delivered (in accordance with the time period prescribed for delivery in a notice to such candidate given by or on behalf of the Board of Directors), to the Secretary at the principal executive offices of the Corporation, (a) a completed written questionnaire (in the form provided by the Corporation) with respect to the background, qualifications, stock ownership and independence of such candidate for nomination and (b) a written representation and agreement (in the form provided by the Corporation) that such candidate for nomination (i) is not, and will not become a party to, any agreement, arrangement or understanding with any Person or entity other than the Corporation with respect to any direct or indirect compensation or reimbursement for service as a director of the Corporation that has not been disclosed in such written questionnaire and (ii) if elected as a director of the Corporation, will comply with all applicable corporate governance, conflict of interest, confidentiality, stock ownership and trading and other policies and guidelines of the Corporation applicable to all directors and in effect during such Person’s term in office as a director (and, if requested by any candidate for nomination, the Secretary of the Corporation shall provide to such candidate for nomination all such policies and guidelines then in effect).
(f) The Board of Directors may also require any proposed candidate for nomination as a Director to furnish such other information as may reasonably be requested by the Board of Directors in writing prior to the meeting of stockholders at which such candidate’s nomination is to be acted upon in order for the Board of Directors to determine the eligibility of such candidate for nomination to be an independent director of the Corporation in accordance with the Corporation’s Corporate Governance Guidelines.
(g) In addition to the requirements of this Section 1.14 with respect to any nomination proposed to be made at a meeting, each Proposing Person shall comply with all applicable requirements of the Exchange Act with respect to any such nominations.
(h) No candidate shall be eligible for nomination as a director of the Corporation unless such candidate for nomination and the Nominating Person seeking to place such candidate’s name in nomination has complied with this Section 1.14, as applicable. The presiding officer at the meeting shall, if the facts warrant, determine that a nomination was not properly made in accordance with this Section 1.14, and if he or she should so determine, he or she shall so declare such determination to the meeting, the defective nomination shall be disregarded and any ballots cast for the candidate in question (but in the case of any form of ballot listing other qualified nominees, only the ballots case for the nominee in question) shall be void and of no force or effect.
(i) Notwithstanding anything in these Bylaws to the contrary, no candidate for nomination shall be eligible to be seated as a director of the Corporation unless nominated and elected in accordance with this Section 1.14.
(j) Notwithstanding anything in these Bylaws to the contrary, for so long as the Original Members (as defined in the Stockholders Agreement) are entitled to nominate a Director pursuant to the Stockholders Agreement, the initial directors specified in the Stockholders Agreement shall not be subject to the notice procedures set forth in this Section 1.14.
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ARTICLE II.
BOARD OF DIRECTORS
Section 2.01 Number; Tenure; Qualifications. Subject to the Certificate of Incorporation, the rights of holders of any series of Preferred Stock to elect directors and that certain stockholders agreement, dated as of the date hereof, by and among the Corporation and the other persons party thereto (as may be amended from time to time, the “Stockholders Agreement”), the total number of directors constituting the entire Board of Directors shall be fixed from time to time exclusively by resolution adopted by a majority of the Whole Board of Directors. For purposes of these Bylaws, the term “Whole Board of Directors” shall mean the total number of authorized directors whether or not there exist any vacancies in previously authorized directorships.The directors shall be classified in the manner provided in the Certificate of Incorporation. Each director shall hold office until such time as provided in the Certificate of Incorporation. Directors need not be Stockholders to be qualified for election or service as a director of the Corporation.
Section 2.02 Election; Resignation; Removal; Vacancies. Except as otherwise provided in the Certificate of Incorporation or these Bylaws, directors shall be elected at the annual meeting of Stockholders by such Stockholders that have the right to vote on such election. Any director may resign at any time upon notice in writing or by electronic transmission to the Corporation. Such resignation shall be effective upon receipt unless otherwise specified therein. Directors of the Corporation may be removed only as expressly provided in the Certificate of Incorporation. Newly created directorships resulting from any increase in the authorized number of directors or any vacancies on the Board of Directors resulting from the death, resignation, disqualification, removal from office or other cause shall be filled as set forth in the Certificate of Incorporation. Any director so chosen shall hold office until the next election of the class for which such director shall have been chosen and until his successor shall be elected and qualified.
Section 2.03 Regular Meetings. Regular meetings of the Board of Directors may be held at such places, if any, within or without the State of Delaware, and at such times as the Board of Directors may from time to time determine. A notice of regular meetings shall not be required.
Section 2.04 Special Meetings. Special meetings of the Board of Directors may be called by a Chairperson or a majority of the directors then in office and shall be held at such time, date and place, if any, within or without the State of Delaware as he or she or they shall fix. Notice to directors of the date, place and time of any special meeting of the Board of Directors shall be given to each director by the Secretary or by the officer or one of the directors calling the meeting. Notice may be given in person, by United States first-class mail, or by e-mail, telephone, telecopier, facsimile or other means of electronic transmission. If the notice is delivered in person, by e-mail, telephone, telecopier, facsimile or other means of electronic transmission, it shall be delivered or sent at least twenty-four (24) hours before the time of holding of the meeting. If the notice is sent by mail, it shall be deposited in the United States mail at least four (4) days before the time of the holding of the meeting.
Section 2.05 Telephonic Meetings Permitted. Members of the Board of Directors may participate in any meetings of the Board of Directors thereof by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this Section 2.05 shall constitute presence in person at such meeting.
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Section 2.06 Quorum; Vote Required for Action. At all meetings of the Board of Directors a majority of the Whole Board of Directors shall constitute a quorum for the transaction of business; provided that, solely for the purposes of filling vacancies pursuant to Section 2.02 of these Bylaws, a meeting of the Board of Directors may be held if a majority of the directors then in office participate in such meeting. The affirmative vote of a majority of the directors present at any meeting of the Board of Directors at which a quorum is present shall be the act of the Board of Directors, except as may be otherwise specifically required by applicable law, the Certificate of Incorporation or these Bylaws.
Section 2.07 Organization. Meetings of the Board of Directors shall be presided over by at least one Chairperson, or in his, her or their absence by the person whom a Chairperson shall designate, or in the absence of the foregoing persons by a chairperson chosen at the meeting by the affirmative vote of a majority of the directors present at the meeting. The Secretary shall act as secretary of the meeting, but in his or her absence the chairperson of the meeting may appoint any person to act as secretary of the meeting.
Section 2.08 Action by Unanimous Consent of Directors. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken without a meeting if all members of the Board of Directors or such committee, as the case may be, consent thereto in writing or by electronic transmission. Thereafter, the writing or writings or electronic transmissions shall be filed with the minutes of proceedings of the Board of Directors or such committee in accordance with applicable law.
Section 2.09 Compensation of Directors. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, the Board of Directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary or other compensation as a director. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed compensation for attending committee meetings. Any director of the Corporation may decline any or all such compensation payable to such director in his or her discretion.
Section 2.10 Chairpersons. Subject to the Stockholders Agreement, the Board of Directors may appoint from its members a Chairperson or Chairpersons of the Board of Directors. The Board of Directors may, in its sole discretion, from time to time appoint one or more vice chairpersons (each, a “Vice Chairperson”) each of whom as such shall report directly to the Chairperson or Chairpersons, as applicable.
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ARTICLE III.
COMMITTEES
Section 3.01 Committees. With the affirmative vote of a majority of the Board of Directors then in office, the Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the Corporation. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of such committee. In the absence or disqualification of a member of any committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in place of any such absent or disqualified member. Any such committee, to the extent permitted by law and to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it. Except as otherwise provided in the Certificate of Incorporation, these Bylaws, or the resolution of the Board of Directors designating the committee, a committee may create one or more subcommittees, each subcommittee to consist of one or more members of the committee, and delegate to a subcommittee any or all of the powers and authority of the committee. Except as otherwise provided in the Certificate of Incorporation, these Bylaws, or the resolution of the Board of Directors designating the committee (or resolution of the committee designating the subcommittee, if applicable), a majority of the directors then serving on a committee or subcommittee shall constitute a quorum for the transaction of business, and the vote of a majority of the members of the committee or subcommittee present at a meeting at which a quorum is present shall be the act of the committee or subcommittee. Special meetings of any committee of the Board of Directors may be held at any time or place, if any, within or without the State of Delaware whenever called by the Chairperson of such committee or a majority of the members of such committee.
Section 3.02 Committee Minutes. Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors when required.
Section 3.03 Committee Rules. Unless the Board of Directors otherwise provides, each committee designated by the Board of Directors may make, alter and repeal rules for the conduct of its business. In the absence of such rules each committee shall conduct its business in the same manner as the Board of Directors conducts its business pursuant to Article II of these Bylaws.
ARTICLE IV.
OFFICERS
Section 4.01 Officers. The officers of the Corporation shall be a Chief Executive Officer, a President and a Secretary. The Corporation may also have, at the discretion of the Board of Directors, a Chairperson or Chairpersons of the Board of Directors, a Vice Chairperson of the Board of Directors, a Chief Financial Officer, a Treasurer, one (1) or more Assistant Secretaries, and any such other officers as may be appointed in accordance with the provisions of these Bylaws. Each officer of the Corporation shall hold office for such term as may be prescribed by the Board of Directors and until his or her successor is duly elected and qualified or until his or her earlier death, resignation or removal. No officer need be a stockholder or director of the Corporation.
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Section 4.02 Appointment of Officers. The Board of Directors shall appoint the officers of the Corporation, except such officers as may be appointed in accordance with the provisions of Section 4.03 of these Bylaws.
Section 4.03 Subordinate Officer. The Board of Directors may appoint, or empower the Chief Executive Officer or, in the absence of a Chief Executive Officer, the President, to appoint, such other officers and agents as the business of the Corporation may require. Each of such officers and agents shall hold office for such period, have such authority, and perform such duties as are provided in these Bylaws or as the Board of Directors may from time to time determine.
Section 4.04 Removal and Resignation of Officers. Any officer may be removed, either with or without cause, by an affirmative vote of the Board of Directors at any regular or special meeting of the Board of Directors or, except in the case of an officer chosen by the Board of Directors, by any officer upon whom such power of removal may be conferred by the Board of Directors. Any officer may resign at any time by giving notice in writing or by electronic transmission to the Corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice. Unless otherwise specified in the notice of resignation, the acceptance of the resignation shall not be necessary to make it effective. If a resignation is made effective at a later date and the Corporation accepts the future effective date, the Board of Directors may fill the pending vacancy before the effective date if the Board of Directors provides that the successor shall not take office until the effective date. Any resignation is without prejudice to the rights, if any, of the Corporation under any contract to which the officer is a party.
Section 4.05 Vacancies in Offices. Any vacancy occurring in any office of the Corporation shall be filled by the Board of Directors or as provided in Section 4.03.
Section 4.06 Chief Executive Officer. Subject to such supervisory powers, if any, as may be given by the Board of Directors to a Chairperson, if any, the Chief Executive Officer (the “CEO”) (if such an officer is appointed) shall, subject to the control of the Board of Directors, have general supervision, direction, and control of the business and the officers of the Corporation. He or she shall preside at all meetings of the stockholders and, in the absence or nonexistence of a Chairperson, at all meetings of the Board of Directors at which he or she is present and shall have the general powers and duties of management usually vested in the office of chief executive officer of a corporation and shall have such other powers and duties as may be prescribed by the Board of Directors or these Bylaw.
Section 4.07 President. The Board of Directors may, but is not obligated to, appoint a President. Subject to such supervisory powers, if any, as may be given by the Board of Directors to a Chairperson (if any) or the CEO, the President, if appointed, shall have general supervision, direction, and control of the business and other officers of the Corporation. He or she shall have the general powers and duties of management usually vested in the office of president of a corporation and such other powers and duties as may be prescribed by the Board of Directors or these Bylaws.
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Section 4.08 Secretary. The Secretary shall keep or cause to be kept, at the principal executive office of the Corporation or such other place as the Board of Directors may direct, a book of minutes of all meetings and actions of directors, committees of directors, and stockholders. The minutes shall show the time and place of each meeting, the names of those present at directors’ meetings or committee meetings, the number of shares present or represented at stockholders’ meetings, and the proceedings thereof. The Secretary shall keep, or cause to be kept, at the principal executive office of the Corporation or at the office of the Corporation’s transfer agent or registrar, as determined by resolution of the Board of Directors, a share register, or a duplicate share register, showing the names of all stockholders and their addresses, the number and classes of shares held by each, the number and date of certificates evidencing such shares, and the number and date of cancellation of every certificate surrendered for cancellation. The Secretary shall give, or cause to be given, notice of all meetings of the Stockholders and of the Board of Directors required to be given by law or by these Bylaws. He or she shall keep the seal of the Corporation, if one be adopted, in safe custody and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or by these Bylaws.
Section 4.09 Chief Financial Officer. The Chief Financial Officer (the “CFO”) shall be the treasurer and shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the Corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital retained earnings, and shares. The books of account shall at all reasonable times be open to inspection by any director. The CFO shall deposit all moneys and other valuables in the name and to the credit of the Corporation with such depositories as may be designated by the Board of Directors. He or she shall disburse the funds of the Corporation as may be ordered by the Board of Directors, shall render to the President, if any is appointed, the CEO, or the directors, upon request, an account of all his or her transactions as CFO and of the financial condition of the Corporation, and shall have other powers and perform such other duties as may be prescribed by the Board of Directors or these Bylaws.
Section 4.10 Representation of Shares of Other Entities. Unless otherwise directed by the Board of Directors, the President or any other person authorized by the Board of Directors or the President is authorized to vote, represent and exercise on behalf of the Corporation all rights incident to any and all shares, securities or interests of any other corporation or entity standing in the name of the Corporation. The authority granted herein may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by such person having the authority.
Section 4.11 Authority and Duties of Officers. All officers of the Corporation shall respectively have such powers and authority and shall perform such duties in the management of the business of the Corporation as may be provided herein or designated from time to time by the Board of Directors and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board of Directors.
Section 4.12 Compensation. The compensation of the officers of the Corporation for their services as such shall be fixed from time to time by or at the direction of the Board of Directors. An officer of the Corporation shall not be prevented from receiving compensation by reason of the fact that he or she is also a director of the Corporation.
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ARTICLE V.
STOCK
Section 5.01 Certificates. The shares of Stock shall be represented by certificates, provided that the Board of Directors may provide by resolution or resolutions that some or all of any or all classes or series of Stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation. Every holder of Stock represented by certificates shall be entitled to have a certificate, in such form as may be prescribed by law and by the Board of Directors, representing the number of shares held by such holder registered in certificate form. Each such certificate shall be signed in a manner that complies with Section 158 of the DGCL.
Section 5.02 Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates. The Corporation may issue a new certificate for shares of Stock in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the Corporation may require the owner of the lost, stolen or destroyed certificate, or such owner’s legal representative, to give the Corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate. The Board of Directors may establish regulations, rules or procedures concerning the proof required for adequately alleging the loss, theft or destruction of any Stock certificate and concerning the giving of a satisfactory bond or bonds of indemnity.
ARTICLE VI.
INDEMNIFICATION AND ADVANCEMENT OF EXPENSES
Section 6.01 Right to Indemnification. The Corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law (including as it presently exists or may hereafter be amended, but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than such law permitted the Corporation to provide prior to such amendment), any person (a “Covered Person”) who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (any such action, suit or proceeding, a “proceeding”), by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the Corporation or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, limited liability company, joint venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys’ fees, judgments, fines ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred by such Covered Person. Notwithstanding the preceding sentence, except as otherwise provided in Section 6.04 of these Bylaws, the Corporation shall be required to indemnify a Covered Person in connection with a proceeding (or part thereof) commenced by such Covered Person only if the commencement of such proceeding (or part thereof) by the Covered Person was authorized in the specific case by the Board of Directors.
Section 6.02 Indemnification of Others. The Corporation shall have the power (but not the obligation) to indemnify and hold harmless, to the fullest extent permitted by applicable law
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as it presently exists or may hereafter be amended, any employee or agent of the Corporation who was or is made or is threatened to be made a party or is otherwise involved in any proceeding by reason of the fact that he or she, or a Person for whom he or she is the legal representative, is or was an employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or non-profit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses reasonably incurred by such Person in connection with any such proceeding.
Section 6.03 Advancement of Expenses. The Corporation shall to the fullest extent not prohibited by applicable law pay the expenses (including attorneys’ fees) incurred by a Covered Person in defending any proceeding in advance of its final disposition, provided, however, that, to the extent required by law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking by the Covered Person to repay all amounts advanced if it should be ultimately determined that the Covered Person is not entitled to be indemnified under this Article VI or otherwise.
Section 6.04 Claims. If a claim for indemnification under this Article VI (following the final disposition of such proceeding) is not paid in full within sixty (60) days after the Corporation has received a written claim therefor by the Covered Person, or if a claim for any advancement of expenses under this Article VI is not paid in full within thirty (30) days after the Corporation has received a written statement or statements requesting such amounts to be advanced, the Covered Person shall thereupon (but not before) be entitled to file suit to recover the unpaid amount of such claim. If successful in whole or in part, the Covered Person shall be entitled to be paid the expense of prosecuting such claim to the fullest extent permitted by law. In any such action, the Corporation shall have the burden of proving that the Covered Person is not entitled to the requested indemnification or advancement of expenses under applicable law.
Section 6.05 Non-exclusivity of Rights. The rights conferred on any Covered Person by this Article VI shall not be exclusive of any other rights which such Covered Person may have or hereafter acquires under any statute, provision of the Certificate of Incorporation, these Bylaws, agreement, vote of Stockholders or disinterested directors or otherwise.
Section 6.06 Insurance. The Corporation may purchase and maintain insurance on behalf of any Person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust enterprise or non-profit entity against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the Corporation would have the power to indemnify him or her against such liability under the provisions of the DGCL.
Section 6.07 Other Sources. The Corporation’s obligation, if any, to indemnify or to advance expenses to any Covered Person who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, limited liability company, joint venture, trust, enterprise or nonprofit entity shall be reduced by any amount such Covered Person may collect as indemnification or advancement of expenses from such other corporation, partnership, limited liability company, joint venture, trust, enterprise or non-profit enterprise.
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Section 6.08 Continuation of Indemnification. The rights to indemnification and to advancement of expenses provided by, or granted pursuant to, this Article VI shall continue as to a Person who has ceased to be a director or officer of the Corporation and shall inure to the benefit of the estate, heirs, executors, administrators, legatees and distributees of such Person.
Section 6.09 Amendment or Repeal. Any right to indemnification or to advancement of expenses of any Covered Person arising hereunder shall not be eliminated or impaired by an amendment to or repeal of these Bylaws or an amendment to the Certificate of Incorporation after the occurrence of the act or omission that is the subject of the proceeding for which indemnification or advancement of expenses is sought.
Section 6.10 Other Indemnification and Advancement of Expenses. This Article VI shall not limit the right of the Corporation, to the extent and in the manner permitted by law, to indemnify and to advance expenses to persons other than Covered Persons when and as authorized by appropriate corporate action.
ARTICLE VII.
MISCELLANEOUS
Section 7.01 Fiscal Year. The fiscal year of the Corporation shall be determined by resolution of the Board of Directors.
Section 7.02 Execution of Corporate Contracts and Instruments. The Board of Directors, except as otherwise provided in these Bylaws, may authorize any officer or officers, or agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the Corporation; such authority may be general or confined to specific instances. Unless so authorized or ratified by the Board of Directors or within the agency power of an officer, no officer, agent or employee shall have any power or authority to bind the Corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount. Any document, including without limitation, any consent, agreement, certificate or instrument, required by the DGCL, the Certificate of Incorporation or these Bylaws to be executed by any officer, director, stockholder, employee or agent of the Corporation may be executed using a facsimile or other form of electronic signature to the fullest extent permitted by applicable law. All other contracts, agreements, certificates or instruments to be executed on behalf of the Corporation may be executed using a facsimile or other form of electronic signature to the fullest extent permitted by applicable law.
Section 7.03 Dividends. The Board of Directors, subject to any restrictions contained in either (i) the DGCL or (ii) the Certificate of Incorporation, may declare and pay dividends upon the shares of its capital Stock. Dividends may be paid in cash, in property or in shares of the Corporation’s capital Stock. The Board of Directors may set apart out of any of the funds of the Corporation available for dividends a reserve or reserves for any proper purpose and may abolish any such reserve. Such purposes shall include but not be limited to equalizing dividends, repairing or maintaining any property of the Corporation, and meeting contingencies.
Section 7.04 Registered Stockholders. The Corporation: (i) shall be entitled to recognize the exclusive right of a Person registered on its books as the owner of shares to receive dividends
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and to vote as such owner; and (ii) shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of another Person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of the State of Delaware.
Section 7.05 Corporate Seal. The Corporation may adopt a corporate seal, which shall be adopted and which may be altered by the Board of Directors. The Corporation may use the corporate seal by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced.
Section 7.06 Construction; Definitions. Unless the context requires otherwise, the general provisions, rules of construction and definitions in the DGCL shall govern the construction of these Bylaws. Without limiting the generality of this provision, the singular number includes the plural and the plural number includes the singular.
Section 7.07 Manner of Notice.
(a) Notice by Electronic Transmission. Without limiting the manner by which notice otherwise may be given effectively to Stockholders pursuant to the DGCL, the Certificate of Incorporation or these Bylaws, any notice to Stockholders given by the Corporation under any provision of the DGCL, the Certificate of Incorporation or these Bylaws shall be effective if given by a form of electronic transmission to the extent permitted by law.
Any notice given pursuant to the preceding paragraph shall be deemed given (i) if by facsimile telecommunication, when directed to a number at which the Stockholder has consented to receive notice; (ii) if by electronic mail, when directed to such Stockholder’s electronic mail address unless the Stockholder has notified the Corporation in writing or by electronic transmission of an objection to receiving notice by electronic mail; (iii) if by a posting on an electronic network together with separate notice to the Stockholder of such specific posting, upon the later of (A) such posting and (B) the giving of such separate notice; and (iv) if by any other form of electronic transmission, when directed to the Stockholder. A notice by electronic mail must include a prominent legend that the communication is an important notice regarding the Corporation.
An affidavit of the Secretary or an Assistant Secretary of the Corporation or of the transfer agent or other agent of the Corporation that the notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein. For the purposes of these Bylaws, an “electronic transmission” means any form of communication, not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.
(b) Notice to Stockholders Sharing an Address. Without limiting the manner by which notice otherwise may be given effectively to Stockholders, and except as prohibited by applicable law, any notice to Stockholders given by the Corporation under any provision of applicable law, the Certificate of Incorporation, or these Bylaws shall be effective if given by a single written notice to Stockholders who share an address if consented to by the Stockholders at that address to whom such notice is given. Any such consent shall be revocable by the Stockholder by written notice to the Corporation. Any Stockholder who fails to object in writing to the Corporation,
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within sixty (60) days of having been given written notice by the Corporation of its intention to send the single notice permitted under this Section 7.07, shall be deemed to have consented to receiving such single written notice.
(c) Notice to Directors. Except as otherwise provided herein or permitted by applicable law, notices to any director may be in writing and delivered personally or mailed to such director at such director’s address appearing on the books of the Corporation, or may be given by telephone or by any means of electronic transmission (including, without limitation, electronic mail) directed to an address for receipt by such director of electronic transmissions appearing on the books of the Corporation.
Section 7.08 Waiver of Notice of Meetings of Stockholders, Directors and Committees. A written waiver of any notice of a meeting, signed by the person entitled to notice, or waiver by electronic transmission by such person, whether given before or after the time stated therein, shall be deemed equivalent to notice of a meeting. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Stockholders, Board of Directors, or committee or subcommittee of the Board of Directors need be specified in a waiver of notice.
Section 7.09 Form of Records. Any records maintained by or on behalf of the Corporation in the regular course of its business, including its stock ledger, books of account, and minute books, may be kept on, or by means of, or be in the form of, any information storage device, method or one or more electronic networks or databases, provided that the records so kept can be converted into clearly legible paper form within a reasonable time, and the stock ledger is maintained in accordance with applicable law.
Section 7.10 Amendment of Bylaws. These Bylaws may be altered, amended or repealed, and new bylaws made, only by the affirmative vote of (a) a majority of the Whole Board of Directors or (b) a majority of the voting power of all of the outstanding Stock entitled to vote thereon, voting together as a single class.
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Exhibit 10.8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into by and among Bridge Investment Group Holdings Inc., a Delaware corporation (“Parent”), Bridge Investment Group Holdings LLC, a Delaware limited liability company (“Partnership”), Bridge Investment Group Employee Operations LLC, a Delaware limited liability company (“Operations”, and together with Parent, the Partnership, or any of the affiliates of Parent, the Partnership, and/or Operations as Executive may provide services to from time to time, and any successor(s) thereto, the “Company”) and Robert Morse (the “Executive”), and shall be effective as of the date on which Parent’s Registration Statement on Form S-1 filed in connection with Parent’s initial public offering becomes effective (the “Effective Date”).
WHEREAS, the Company desires to continue to employ the Executive and the Company and the Executive desire to enter into an agreement embodying the terms of such continued employment, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Effective upon the Effective Date, the Executive’s employment hereunder shall be for a term (the “Employment Period”) commencing on the Effective Date and continuing indefinitely until terminated in accordance with the terms of this Agreement. Notwithstanding anything to the contrary in the foregoing, the Executive’s employment hereunder is terminable at will by the Company or by the Executive at any time (for any reason or for no reason), subject to the provisions of Section 4 hereof.
2. Terms of Employment.
(a) Position and Duties.
(i) Role and Responsibilities. Executive shall continue to serve as the Executive Chairman of the Company and a Partner in the Partnership, and shall perform such employment duties as are usual and customary for such positions. In addition, Executive currently serves as a member of the Board of Directors of the Company (the “Board”). The Executive shall report directly to the Board. At the Company’s request, the Executive shall serve the Company and/or its subsidiaries and affiliates in other capacities in addition to the foregoing, consistent with the Executive’s position hereunder. In the event that the Executive, during the Employment Period, serves in any one or more of such additional capacities, the Executive’s compensation shall not be increased beyond that specified in Section 2(b) hereof, unless otherwise determined by the Board. In addition, in the event the Executive’s service in one or more of such additional capacities is terminated, the Executive’s compensation, as specified in Section 2(b) hereof, shall not be diminished or reduced in any manner as a result of such termination provided that the Executive otherwise remains employed under the terms of this Agreement, unless otherwise determined by the Board.
(ii) Exclusivity. During the Employment Period, and excluding any periods of leave to which the Executive may be entitled, the Executive agrees to devote his or her full business time and attention to the business and affairs of the Company. Notwithstanding the foregoing, during the Employment Period, it shall not be a violation of this Agreement for the Executive to: (A) serve on boards, committees or similar bodies of charitable or nonprofit organizations, (B) fulfill limited teaching, speaking and writing engagements, and (C) manage his or her personal investments, in each case, so long as such activities do not individually or in the aggregate materially interfere or conflict with the performance of the Executive’s duties and responsibilities under this Agreement; provided, that with respect to the activities in subclause (A), the Executive receives prior written approval from the Board.
(b) Compensation, Benefits, Etc.
(i) Base Salary. Effective as of the Effective Date and during the Employment Period, the Executive shall receive a base salary (the “Base Salary”) of $500,000 per annum. The Base Salary shall be paid in accordance with the Company’s normal payroll practices for executive salaries generally, but no less often than monthly and shall be pro-rated for partial years of employment. The Base Salary may be increased in the discretion of the Board or a subcommittee thereof, but not reduced, and the term “Base Salary” as utilized in this Agreement shall refer to the Base Salary as so increased.
(ii) Cash Bonus. For each calendar year ending during the Employment Period, the Executive shall be eligible to earn a cash performance bonus (a “Bonus”) under the Company’s bonus plan or program applicable to senior executives targeted at 145.475% of the Executive’s Base Salary. The actual amount of any Bonus shall be determined by the Board (or a subcommittee thereof) in its discretion, based on the achievement of individual and/or Company performance goals as determined by the Board (or a subcommittee thereof). The payment of any Bonus, to the extent any Bonus becomes payable, will be made on the date(s) on which semi-annual or annual bonuses are paid generally to the Company’s senior executives, subject to the Executive’s continued employment through the payment date.
(iii) IPO Equity Award. Upon the closing of Parent’s initial public offering, Parent shall issue to the Executive an award of 585,428 shares of restricted Class A common stock under Parent’s 2021 Incentive Award Plan. Except as otherwise provided herein, subject to Executive’s continued employment with the Company through each such date, the restricted stock award shall vest in three equal installments on each of the third, fourth and fifth anniversaries of the closing date of Parent’s initial public offering. The terms and conditions of the restricted stock award shall be set forth in an award agreement in a form prescribed by the Board to be entered into by the Company and Executive.
(iv) Carried Interest Awards. Executive shall be entitled to participate in such portion of the carried interest in the Company’s affiliated fund general partners as is determined by the Board. Except as otherwise provided herein, the terms and conditions of all carried interest awards will be set forth in the applicable partnership agreements and award letters.
(v) Benefits. During the Employment Period, the Executive (and the Executive’s spouse and/or eligible dependents to the extent provided in the applicable plans and programs) shall be eligible to participate in and be covered under the health and welfare benefit plans and programs maintained by the Company for the benefit of its employees from time to time, pursuant to the terms of such plans and programs including any medical, life, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs on the same terms and conditions as those applicable to similarly situated senior executives. In addition, during the Employment Period, the Executive shall be eligible to participate in any retirement, savings and other employee benefit plans and programs maintained from time to time by the Company for the benefit of its senior executive officers. Nothing contained in this Section 2(b)(v) shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
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(vi) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in connection with the performance of his or her duties under this Agreement in accordance with the policies, practices and procedures of the Company provided to employees of the Company.
(vii) Fringe Benefits. During the Employment Period, the Executive shall be eligible to receive such fringe benefits and perquisites as are provided by the Company to its employees from time to time, in accordance with the policies, practices and procedures of the Company, and shall receive such additional fringe benefits and perquisites as the Company may, in its discretion, from time-to-time provide.
(viii) Vacation/Paid Time Off. During the Employment Period, the Executive shall be entitled to vacation and/or paid time off in accordance with the plans, policies, programs and practices of the Company applicable to its senior executives.
3. Termination of Employment.
(a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. Either the Company or the Executive may terminate the Executive’s employment in the event of the Executive’s Disability during the Employment Period.
(b) Termination by the Company. The Company may terminate the Executive’s employment during the Employment Period for Cause or without Cause.
(c) Termination by the Executive. The Executive’s employment may be terminated by the Executive for any or no reason, including with Good Reason or by the Executive without Good Reason.
(d) Notice of Termination. Any termination of employment (other than due to the Executive’s death), shall be communicated by a Notice of Termination to the other parties hereto given in accordance with Section 11(b) hereof. The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
(e) Termination of Offices and Directorships; Return of Property. Upon termination of the Executive’s employment for any reason, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions, if any, then held with the Company, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive agrees to return to the Company all documents of the Company and its affiliates (and all copies thereof) and all other Company or Company affiliate property that the Executive has in his or her possession, custody or control. Such property includes, without limitation: (i) any materials of any kind that the Executive knows contain or embody any proprietary or confidential information of the Company or an affiliate of the Company (and all reproductions thereof), (ii) computers (including, but not limited to, laptop computers, desktop computers and similar devices) and other portable electronic devices (including, but not limited to, tablet computers), cellular phones/smartphones, credit cards, phone cards, entry cards, identification badges and keys, and (iii) any correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the business, clients, investors, customers, business plans, marketing strategies, products and/or processes of the Company or any of its affiliates and any information received from the Company or any of its affiliates regarding third parties.
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4. Obligations of the Company upon Termination.
(a) Accrued Obligations. In the event that the Executive’s employment under this Agreement terminates during the Employment Period for any reason, the Company will pay or provide to the Executive: (i) any earned but unpaid Base Salary and accrued but unused vacation or paid time off, and (ii) reimbursement of any business expenses incurred by the Executive prior to the Date of Termination that are reimbursable in accordance with Section 2(b)(vi) hereof (together, the “Accrued Obligations”). The Accrued Obligations described in clauses (i) – (ii) of the preceding sentence shall be paid within thirty (30) days after the Date of Termination (or such earlier date as may be required by applicable law).
(b) Qualifying Termination. Subject to Sections 4(e), 4(f), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof (including the Restrictive Covenants Agreement), if the Executive’s employment with the Company is terminated during the Employment Period due to a Qualifying Termination, then in addition to the Accrued Obligations:
(i) Cash Severance. The Company shall continue to pay Executive his or her Base Salary at the then-current rate per pay period for a period of twelve (12) months (the “Severance Period”) following the termination of the Employment Period, in accordance with the Company’s then-current payroll policies and practices. The foregoing severance payments shall commence on the first payroll period following the date Executive’s Release becomes effective (the “Payment Date”) and the first payment shall include all accrued amounts from the Date of Termination; provided, however, if upon Executive’s Qualifying Termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement (as such term is defined therein), then, in each pay period, any Base Salary to be provided pursuant to this Section 4(b)(i) shall be reduced by the amount of such Garden Leave Compensation also paid in such pay period.
(ii) COBRA. Unless Section 4(b)(v)(C) applies, in which case this section shall not apply, subject to the Executive’s valid election to continue healthcare coverage under Section 4980B of the Code, for the Severance Period, the Company shall continue to provide, during the Severance Period, the Executive and the Executive’s eligible dependents with coverage under its group health plans at the same levels and the same cost to the Executive as would have applied if the Executive’s employment had not been terminated based on the Executive’s elections in effect on the Date of Termination, provided, however, that (A) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the continuation coverage period (or the remaining portion thereof). If upon Executive’s Qualifying Termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement (as such term is defined therein), the healthcare coverage under this Section 4(b)(ii) shall not apply for any period during which reimbursement of COBRA premiums is provided to Executive as part of such Garden Leave Compensation in such period.
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(iii) Equity Acceleration. All outstanding Company equity awards that are held by the Executive on the Date of Termination (other than any carried interest awards) shall vest and, to the extent applicable, become exercisable on an accelerated basis as of the Date of Termination with respect to the number of shares underlying such award that would have vested (and become exercisable, if applicable) had the Executive remained in continuous service beyond the Date of Termination for the Severance Period. Notwithstanding the foregoing, in the event that the Qualifying Termination occurs on or within eighteen (18) months following a Change in Control, then all outstanding Company equity awards that are held by the Executive on the Date of Termination (other than any carried interest awards) shall become fully vested and, to the extent applicable, exercisable. Any remaining unvested Company equity awards after giving effect to the foregoing acceleration (other than any carried interest awards) shall be immediately forfeited for no consideration upon such termination. The foregoing provisions are hereby deemed to be a part of each equity award (and, for the avoidance of doubt, if any equity award is subject to more favorable vesting pursuant to any agreement or plan regarding such equity award, such more favorable provisions shall continue to apply and shall not be limited by this clause (iii)).
(v) Partner Alumna/Alumnus and Partner Emerita/Emeritus Status. Subject to Executive’s satisfaction of the requirements set forth in Exhibit B, Executive shall be eligible for:
(A) To the extent Executive satisfies the requirements for “Partner Alumna/Partner Alumnus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(B) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(C) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, for so long as Executive retains such “Partner Emerita/Emeritus” status (the “Partner Emerita/Emeritus Coverage Period”), the Company shall continue to provide, during the Partner Emeritus Coverage Period, the Executive and the Executive’s eligible dependents with coverage under its group health plans at the same levels and the same cost to the Executive as would have applied if the Executive’s employment had not been terminated based on the Executive’s elections in effect on the Date of Termination, which continuation coverage shall be provided, to the extent possible, under COBRA, provided, however, that (1) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (2) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the Partner Emerita/Emeritus Coverage Period (or the remaining portion thereof). If upon Executive’s termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement, the healthcare coverage under this Section 4(b)(v)(C) shall not apply for any period during which reimbursement of COBRA premiums is provided to Executive as part of such Garden Leave Compensation in such period.
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(D) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, and except to the extent a carried interest award agreement governing a carried interest award granted to Executive specifically provides for the treatment of such carried interest award in the event of Executive’s Qualifying Termination and provides that its terms shall supersede the provisions of this Section 4(b)(v), in which case the terms of such award agreement shall govern, seventy-five percent (75%) of the outstanding unvested carried interest awards held by Executive shall become fully vested upon the date of such termination. The foregoing provisions are hereby deemed to be a part of each carried interest award (and, for the avoidance of doubt, if any carried interest award is subject to more favorable vesting pursuant to any agreement or plan regarding such carried interest award, such more favorable provisions shall continue to apply and shall not be limited by this clause (v)(D)).
(c) Resignation Other than for Good Reason. Subject to Sections 4(c), 4(e), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof, if the Executive’s employment with the Company is terminated during the Employment Period due to Executive’s voluntary resignation other than for Good Reason, then in addition to the Accrued Obligations, subject to Executive’s satisfaction of the requirements set forth in Exhibit B, Executive shall be eligible for:
(i) To the extent Executive satisfies the requirements for “Partner Alumna/Partner Alumnus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(ii) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(iii) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits specified under Section 4(b)(v)(C) above.
(iv) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, and except to the extent a carried interest award agreement governing a carried interest award granted to Executive specifically provides for the treatment of such carried interest award in the event of Executive’s Qualifying Termination and provides that its terms shall supersede the provisions of this Section 4(c)(iv), in which case the terms of such award agreement shall govern, seventy-five percent (75%) of the outstanding unvested carried interest awards held by Executive shall become fully vested upon the date of such termination.
(d) Death or Disability. Subject to Sections 4(c), 4(e), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof, if the Executive’s employment with the Company is terminated during the Employment Period as a result of Executive’s death or Disability, then in addition to the Accrued Obligations:
(i) Equity Acceleration. All outstanding Company equity awards that are subject to time-based vesting conditions that are held by the Executive on the Date of Termination shall vest and, to the extent applicable, become exercisable on an accelerated basis as of the Date of Termination.
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(ii) Carried Interest Acceleration. All outstanding carried interest awards shall vest as of the Date of Termination.
(e) Release. Notwithstanding the foregoing, it shall be a condition to the Executive’s right to receive the amounts provided for in Sections 4(b), 4(c) or 4(d) hereof that the Executive execute and deliver to the Company an effective release of claims in substantially the form attached hereto as Exhibit A (the “Release”) within twenty-one (21) days (or, to the extent required by law, forty-five (45) days) following the Date of Termination and that the Executive not revoke such Release during any applicable revocation period. For the avoidance of doubt, all equity awards and/or carried interest awards eligible for accelerated vesting pursuant to Sections 4(b), 4(c) or 4(d) hereof shall remain outstanding and eligible to vest following the Date of Termination and shall actually vest and become exercisable (if applicable) and non-forfeitable upon the effectiveness of the Release.
(f) Other Terminations. If the Executive’s employment is terminated for any reason not described in Sections 4(b), 4(c) or 4(d) hereof, the Company will pay the Executive only the Accrued Obligations.
(g) Six-Month Delay. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits, including without limitation any severance payments or benefits payable under this Section 4, shall be paid to the Executive during the six-month period following the Executive’s Separation from Service if the Company determines that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first day of the seventh month following the date of Separation from Service (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of the Executive’s death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period.
(h) Exclusive Benefits. Except as expressly provided in this Section 4 and subject to Section 5 hereof, the Executive shall not be entitled to any additional payments or benefits upon or in connection with the Executive’s termination of employment.
5. Non-Exclusivity of Rights. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
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6. Restrictive Covenants.
(a) The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company and its subsidiaries and affiliates, which shall have been obtained by the Executive in connection with the Executive’s employment by the Company and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company, the Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data, to anyone other than the Company and those designated by it; provided, however, that if the Executive receives actual notice that the Executive is or may be required by law or legal process to communicate or divulge any such information, knowledge or data, the Executive shall promptly so notify the Company.
(b) While employed by the Company, the Executive shall not be engaged in any other business activity that would be competitive with the business of the Company and its subsidiaries or affiliates. In addition, while employed by the Company and for a period of twelve (12) months after the Date of Termination, the Executive shall not directly or indirectly solicit, induce, or encourage any employee or consultant of the Company and/or its subsidiaries and affiliates to terminate their employment or other relationship with the Company and its subsidiaries and affiliates or to cease to render services to the Company and/or its subsidiaries and affiliates and the Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity except, in each case, to the extent the foregoing occurs as a result of general advertisements or other solicitations not specifically targeted to such employees and consultants. During his or her employment with the Company and for a period of twelve (12) months after the Date of Termination, the Executive shall not use any trade secret of the Company or its subsidiaries or affiliates to solicit, induce, or encourage any customer, client, vendor, or other party doing business with any member of the Company and its subsidiaries and affiliates to terminate its relationship therewith or transfer its business from any member of the Company and its subsidiaries and affiliates and the Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity.
(c) Subject to Section 6(f), during the Executive’s service with the Company and thereafter, excepting any litigation between the parties, (i) the Executive agrees not to publish or disseminate, directly or indirectly, any statements, whether written or oral, that are or could be harmful to or reflect negatively on any of the Company or any of its subsidiaries or affiliates, or that are otherwise disparaging of any policies, procedures, practices, decision-making, conduct, professionalism or compliance with standards of the Company, its affiliates or any of their past or present officers, directors, employees, advisors or agents, and (ii) the Company agrees to instruct its directors and executive officers not to publish or disseminate, directly or indirectly, any statements, whether written or oral, that are or could be harmful to or reflect negatively on the Executive’s personal or business reputation or business.
(d) In recognition of the fact that irreparable injury will result to the Company in the event of a breach by the Executive of his or her obligations under Sections 6(a)-(c) hereof, that monetary damages for such breach would not be readily calculable, and that the Company would not have an adequate remedy at law therefor, the Executive acknowledges, consents and agrees that in the event of such breach, or the threat thereof, the Company shall be entitled, in addition to any other legal remedies and damages available, to specific performance thereof and to temporary and permanent injunctive relief (without the necessity of posting a bond) to restrain the violation or threatened violation of such obligations by the Executive and to cease the payment of any benefits under Section 4(b)-(c) above.
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(e) The Executive hereby acknowledges that the Executive has previously entered into the Company’s standard form of Non-Competition, Non-Solicitation and Non-Disclosure Agreement, containing confidentiality, intellectual property assignment and other protective covenants (the “Restrictive Covenant Agreement”), that the Executive shall continue to be bound by the terms and conditions of the Restrictive Covenant Agreement, and that such agreement shall be additional to, and not in limitation of, the covenants contained in this Section 6.
(f) Notwithstanding anything in this Agreement or the Restrictive Covenant Agreement to the contrary, nothing contained in this Agreement shall prohibit either party (or either party’s attorney(s)) from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the U.S. Commodity Futures Trading Commission, the U.S. Department of Justice or any other securities regulatory agency, self-regulatory authority or federal, state or local regulatory authority (collectively, “Government Agencies”), or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation, (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to any Government Agencies for the purpose of reporting or investigating a suspected violation of law, or from providing such information to such party’s attorney(s) or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding, and/or (iii) receiving an award for information provided to any Government Agency. Pursuant to 18 USC Section 1833(b), the Executive will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Further, nothing in this Agreement is intended to or shall preclude either party from providing truthful testimony in response to a valid subpoena, court order, regulatory request or other judicial, administrative or legal process or otherwise as required by law. If the Executive is required to provide testimony, then unless otherwise directed or requested by a Government Agency or law enforcement, the Executive shall notify the Company as soon as reasonably practicable after receiving any such request of the anticipated testimony.
7. Representations. The Executive hereby represents and warrants to the Company that (a) the Executive is entering into this Agreement voluntarily and that the performance of the Executive’s obligations hereunder will not violate any agreement between the Executive and any other person, firm, organization or other entity, and (b) the Executive is not bound by the terms of any agreement with any previous employer or other party to refrain from competing, directly or indirectly, with the business of such previous employer or other party that would be violated by the Executive’s entering into this Agreement and/or providing services to the Company pursuant to the terms of this Agreement.
8. Successors.
(a) This Agreement is personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon the Company and their respective successors and assigns.
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9. Section 280G of the Code.
(a) Best Pay Provision. In the event that any payment or benefit received or to be received by Executive pursuant to the terms of any plan, arrangement or agreement (including any payment or benefit received in connection with a change in ownership or control or the termination of Executive’s employment) (all such payments and benefits being hereinafter referred to as the “Total Payments”) would be subject (in whole or part) to the excise tax (the “Excise Tax”) imposed under Section 4999 of the Code, then the Total Payments shall be reduced to the extent necessary so that no portion of the Total Payments is subject to the Excise Tax but only if (i) the net amount of such Total Payments, as so reduced (after subtracting the amount of federal, state and local income taxes on such reduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced Total Payments) is greater than or equal to (ii) the net amount of such Total Payments without such reduction (after subtracting the net amount of federal, state and local income taxes on such Total Payments and the amount of Excise Tax to which Executive would be subject in respect of such unreduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced Total Payments). Except to the extent that an alternative reduction order would result in a greater economic benefit to the Executive on an after-tax basis, the parties intend that the Total Payments shall be reduced in the following order: (w) reduction of any cash severance payments otherwise payable to Executive that are exempt from Section 409A of the Code, (x) reduction of any other cash payments or benefits otherwise payable to Executive that are exempt from Section 409A of the Code, but excluding any payment attributable to the acceleration of vesting or payment with respect to any equity award that is exempt from Section 409A of the Code, (y) reduction of any other payments or benefits otherwise payable to Executive on a pro-rata basis or such other manner that complies with Section 409A of the Code, but excluding any payment attributable to the acceleration of vesting and payment with respect to any equity award that is exempt from Section 409A of the Code, and (z) reduction of any payments attributable to the acceleration of vesting or payment with respect to any equity award that is exempt from Section 409A of the Code; provided, in case of clauses (x), (y) and (z), that reduction of any payments or benefits attributable to the acceleration of vesting of Company equity awards shall be first applied to equity awards with later vesting dates; provided, further, that, notwithstanding the foregoing, any such reduction shall be undertaken in a manner that complies with and does not result in the imposition of additional taxes on the Executive under Section 409A of the Code. The foregoing reductions shall be made in a manner that results in the maximum economic benefit to Executive on an after-tax basis and, to the extent economically equivalent payments or benefits are subject to reduction, in a pro rata manner.
(b) Determinations. All determinations regarding the application of this Section 9 shall be made by an independent accounting firm or consulting group with nationally recognized standing and substantial expertise and experience in performing calculations regarding the applicability of Section 280G of the Code and the Excise Tax retained by the Company prior to the date of the applicable change in ownership or control (the “280G Firm”). For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax, (i) no portion of the Total Payments shall be taken into account which (x) does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, or (y) constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation, (ii) no portion of the Total Payments the receipt or enjoyment of which Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be taken into account, and (iii) the value of any non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by the 280G Firm in accordance with the principles of Sections 280G(d)(3) and (iv) of the Code. All determinations related to the calculations to be performed pursuant to this “Section 280G Treatment” section shall be done by the 280G Firm. The 280G Firm will be directed to submit its determination and detailed supporting calculations to both Executive and the Company within fifteen (15) days after notification from either the Company or Executive that Executive may receive payments which may be
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“parachute payments.” Executive and the Company will each provide the 280G Firm access to and copies of any books, records, and documents as may be reasonably requested by the 280G Firm, and otherwise cooperate with the 280G Firm in connection with the preparation and issuance of the determinations and calculations contemplated by this Agreement. The fees and expenses of the 280G Firm for its services in connection with the determinations and calculations contemplated by this Agreement will be borne solely by the Company.
10. Certain Definitions.
(a) “Board” means the Board of Directors of the Company.
(b) “Cause” means the occurrence of any one or more of the following events:
(i) the Executive’s willful failure to substantially perform his or her duties with the Company (other than any such failure resulting from the Executive’s incapacity due to physical or mental illness or any such actual or anticipated failure after his or her issuance of a Notice of Termination for Good Reason), including the Executive’s failure to follow any lawful directive from the Board within the reasonable scope of the Executive’s duties and the Executive’s failure to correct the same (if capable of correction, as determined by the Board), within thirty (30) days after a written notice is delivered to the Executive, which demand specifically identifies the manner in which the Board believes that the Executive has not performed his or her duties;
(ii) the Executive’s conviction of, indictment for or entry of a plea of guilty or nolo contendere to a felony crime (excluding vehicular crimes) or a crime of moral turpitude;
(iii) the Executive’s material breach of any material obligation under any written agreement with the Company or its affiliates or under any applicable policy of the Company or its affiliates (including any code of conduct or harassment policies), and the Executive’s failure to correct the same (if capable of correction, as determined by the Board), within thirty (30) days after a written notice is delivered to the Executive, which demand specifically identifies the manner in which the Board believes that the Executive has materially breached such agreement or policy;
(iv) any act of fraud, embezzlement, theft or misappropriation from the Company or its affiliates by the Executive;
(v) the Executive’s willful misconduct or gross negligence with respect to any material aspect of the Company’s business or a material breach by the Executive of his or her fiduciary duty to the Company or its affiliates, which willful misconduct, gross negligence or material breach has a material and demonstrable adverse effect on the Company or its affiliates; or
(vi) the Executive’s commission of an act of material dishonesty resulting in material reputational, economic or financial injury to the Company or its affiliates.
(a) “Change in Control” has the meaning set forth in the Plan. Notwithstanding the foregoing, in no event shall Parent’s initial public offering constitute a Change in Control and, if a Change in Control constitutes a payment event with respect to any amount hereunder that provides for the deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event shall only constitute a Change in Control for purposes of the payment timing of such amount if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5).
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(b) “Code” means the Internal Revenue Code of 1986, as amended, and the regulations thereunder.
(c) “Date of Termination” means the date on which the Executive’s employment with the Company terminates.
(d) “Disability” means that the Executive has become entitled to receive benefits under an applicable Company long-term disability plan or, if no such plan covers the Executive, as determined in the reasonable discretion of the Board.
(e) “Good Reason” means the occurrence of any one or more of the following events without the Executive’s prior written consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) as provided below:
(i) a material diminution in the Executive’s base compensation, unless such a reduction is imposed as part of a generalized reduction in the base salaries of senior management of the Company;
(ii) a material diminution in the Executive’s title, authority or duties, as contemplated by this Agreement; or
(iii) the Company’s material breach of this Agreement.
Notwithstanding the foregoing, the Executive will not be deemed to have resigned for Good Reason unless (1) the Executive provides the Company with written notice setting forth in reasonable detail the facts and circumstances claimed by the Executive to constitute Good Reason within thirty (30) days after the date of the occurrence of any event that the Executive knows or should reasonably have known to constitute Good Reason, (2) the Company fails to cure such acts or omissions within thirty (30) days following its receipt of such notice, and (3) the effective date of the Executive’s termination for Good Reason occurs no later than sixty (60) days after the expiration of the Company’s cure period.
(f) “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice unless as otherwise provided upon a termination for Good Reason).
(g) “Plan” means Parent’s 2021 Incentive Award Plan, as amended from time to time.
(h) “Qualifying Termination” means a termination of the Executive’s employment (i) by the Company without Cause (other than by reason of the Executive’s death or Disability), or (ii) by the Executive for Good Reason.
(i) “Section 409A” means Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.
(j) “Separation from Service” means a “separation from service” (within the meaning of Section 409A).
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11. Miscellaneous.
(a) Governing Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without reference to principles of conflict of laws. Any suit brought hereon shall be brought in the state or federal courts sitting in Salt Lake City, Utah, the parties hereby waiving any claim or defense that such forum is not convenient or proper. Each party hereby agrees that any such court shall have in personam jurisdiction over it and consents to service of process in any manner authorized by Utah law.
(b) Notices. Any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows with notice deemed given as indicated: (i) by personal delivery when delivered personally; (ii) by overnight courier upon written verification of receipt; (iii) by email upon acknowledgment of receipt of electronic transmission; or (iv) by certified or registered mail, return receipt requested, upon verification of receipt. Notice shall be sent to Executive at the address listed on the Company’s personnel records and to the Company at its principal place of business to the attention of the Company’s General Counsel, or such other address as either party may specify in writing.
(c) Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”), then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder.
(d) Section 409A of the Code.
(i) To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be subject to Section 409A, the Company shall work in good faith with the Executive to adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 11(d) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
(ii) Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
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(iii) To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
(e) Severability. In the event any provision of this Agreement is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.
(f) Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
(g) No Waiver. The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c) hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
(h) Entire Agreement. As of the Effective Date, this Agreement and the Restrictive Covenant Agreement constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, by any member of the Company and its subsidiaries or affiliates, or representative thereof. Notwithstanding anything herein to the contrary, this Agreement and the obligations and commitments hereunder shall neither commence nor be of any force or effect prior to the Effective Date.
(i) Arbitration. To aid in the rapid and economical resolution of any disputes that may arise in the course of the employment relationship, Executive and the Company agree that any and all disputes, claims, or demands in any way arising out of or relating to the terms of this Agreement, Company equity held by Executive, Executive’s employment relationship with the Company, or the termination of Executive’s employment or service relationship with the Company, shall be resolved, to the fullest extent permitted by law, by final, binding and confidential arbitration in Salt Lake City, Utah, conducted before a single neutral arbitrator selected and administered in accordance with the employment arbitration rules & procedures or then applicable equivalent rules of JAMS, Inc. (the “JAMS Rules”) and the Federal Arbitration Act, 9 U.S.C. Sec. 1, et seq. A copy of the JAMS rules may be found on the JAMS website at www.jamsadr.com and will be provided to Executive by the Company upon request. BY AGREEING TO THIS ARBITRATION PROCEDURE, EXECUTIVE AND THE COMPANY WAIVE THE RIGHT TO RESOLVE ANY SUCH DISPUTE, CLAIM OR DEMAND THROUGH A TRIAL BY JURY OR JUDGE OR BY ADMINISTRATIVE PROCEEDING IN ANY JURISDICTION. Executive will have the right to be represented by legal counsel at any arbitration proceeding, at Executive’s expense. The arbitrator shall: (a) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be available under applicable law in a court proceeding and (b) issue a written statement signed by the arbitrator regarding the disposition of each claim and the relief, if any, awarded as
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to each claim, the reasons for the award, and the arbitrator’s essential findings and conclusions on which the award is based. The parties agree that the prevailing party in any arbitration shall be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitration award. This Section 11(i) is intended to be the exclusive method for resolving any and all claims by the parties against each other for payment of damages under this Agreement or relating to Executive’s employment; provided, however, that Executive shall retain the right to file administrative charges with or seek relief through any government agency of competent jurisdiction, and to participate in any government investigation, including but not limited to (i) claims for workers’ compensation, state disability insurance or unemployment insurance; (ii) claims for unpaid wages or waiting time penalties brought before any governmental agency; provided, however, that any appeal from an award or from denial of an award of wages and/or waiting time penalties shall be arbitrated pursuant to the terms of this Agreement; and (iii) claims for administrative relief from the United States Equal Employment Opportunity Commission and/or the any similar agency in any applicable jurisdiction; provided, further, that Executive shall not be entitled to obtain any monetary relief through such agencies other than workers’ compensation benefits or unemployment insurance benefits. Nothing in this Agreement is intended to prevent either Executive or the Company from obtaining injunctive relief (or any other provisional remedy) in any court of competent jurisdiction pursuant to applicable law to prevent irreparable harm (including, without limitation, pending the conclusion of any arbitration). The Company shall pay the arbitrator’s fees, arbitration expenses and any other costs unique to the arbitration proceeding (recognizing that each side shall bear its own deposition, witness, expert and attorney’s fees and other expenses to the same extent as if the matter were being heard in court); provided, however, that the arbitrator may award attorney’s fees and costs to the prevailing party, except as prohibited by law.
THE EXECUTIVE AND THE COMPANY WAIVE ANY CONSTITUTIONAL OR OTHER RIGHT TO BRING CLAIMS COVERED BY THIS AGREEMENT OTHER THAN IN THEIR INDIVIDUAL CAPACITIES. EXCEPT AS MAY BE PROHIBITED BY LAW, THIS WAIVER INCLUDES THE ABILITY TO ASSERT CLAIMS AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING.
(j) Amendment; Survival; Construction. No amendment or other modification of this Agreement shall be effective unless made in writing and signed by the parties hereto. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.
(k) Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement. This Agreement may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.
| BRIDGE INVESTMENT GROUP HOLDINGS INC. | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Chief Executive Officer | |||
| BRIDGE INVESTMENT GROUP HOLDINGS LLC | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Authorized Signatory | |||
| BRIDGE INVESTMENT GROUP EMPLOYEE OPERATIONS LLC | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Authorized Signatory | |||
| “EXECUTIVE” |
|
/s/ Robert Morse |
|
Robert Morse |
[Signature Page to Employment Agreement]
EXHIBIT A
GENERAL RELEASE
1. Release For valuable consideration, the receipt and adequacy of which are hereby acknowledged, the undersigned does hereby release and forever discharge the “Releasees” hereunder, consisting of Bridge Investment Group Holdings Inc., a Delaware corporation (“Parent”), Bridge Investment Group Holdings LLC, a Delaware limited liability company (“Partnership”), Bridge Investment Group Employee Operations LLC, a Delaware limited liability company (“Operations”, and together with Parent, the Partnership, or any of the affiliates of Parent, the Partnership, and/or Operations as Executive may provide services to from time to time, and any successor(s) thereto, the “Company”), and the Company’s partners, subsidiaries, associates, affiliates, successors, heirs, assigns, agents, directors, officers, employees, representatives, lawyers, insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, losses, costs, attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called “Claims”), which the undersigned now has or may hereafter have against the Releasees, or any of them, by reason of any matter, cause, or thing whatsoever from the beginning of time to the date hereof. The Claims released herein include, without limiting the generality of the foregoing, any Claims in any way arising out of, based upon, or related to the employment or termination of employment of the undersigned by the Releasees, or any of them; any alleged breach of any express or implied contract of employment; any alleged torts or other alleged legal restrictions on Releasees’ right to terminate the employment of the undersigned; and any alleged violation of any federal, state or local statute or ordinance including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act, the Americans With Disabilities Act.
2. Claims Not Released. Notwithstanding the foregoing, this general release (the “Release”) shall not operate to release any rights or claims of the undersigned (i) to payments or benefits under Section 4(b)-(d) of that certain Employment Agreement, dated as of July 6, 2021, between the Company and the undersigned (the “Employment Agreement”), with respect to the payments and benefits provided in exchange for this Release, (ii) to payments or benefits under any equity award agreement between the undersigned and the Company, (iii) with respect to Section 2(b)(vi) of the Employment Agreement, (iv) to accrued or vested benefits the undersigned may have, if any, as of the date hereof under any applicable plan, policy, practice, program, contract or agreement with the Company, (v) to any Claims, including Claims for indemnification and/or advancement of expenses arising under any indemnification agreement between the undersigned and the Company or under the bylaws, certificate of incorporation or other similar governing document of the Company, (vi) to any Claims which cannot be waived by an employee under applicable law or (vii) with respect to the undersigned’s right to communicate directly with, cooperate with, or provide information to, any federal, state or local government regulator.
3. Unknown Claims. THE UNDERSIGNED ACKNOWLEDGES THAT THE UNDERSIGNED HAS BEEN ADVISED BY LEGAL COUNSEL AND IS FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
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THE UNDERSIGNED, BEING AWARE OF SAID CODE SECTION, HEREBY EXPRESSLY WAIVES ANY RIGHTS THE UNDERSIGNED MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.
4. Exceptions. Notwithstanding anything in this Release to the contrary, nothing contained in this Release shall prohibit the undersigned from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with any governmental agency or entity or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation and/or (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to, any federal, state or local government regulator (including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice) for the purpose of reporting or investigating a suspected violation of law, or from providing such information to the undersigned’s attorney or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding. Pursuant to 18 USC Section 1833(b), the undersigned will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
5. Representations; Continuing Obligations. The undersigned represents and warrants that there has been no assignment or other transfer of any interest in any Claim which the undersigned may have against Releasees, or any of them, and the undersigned agrees to indemnify and hold Releasees, and each of them, harmless from any liability, Claims, demands, damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of them, as the result of any such assignment or transfer or any rights or Claims under any such assignment or transfer. It is the intention of the parties that this indemnity does not require payment as a condition precedent to recovery by the Releasees against the undersigned under this indemnity. The undersigned hereby expressly reaffirms his obligations under Section 6 of the Employment Agreement, and agrees that such obligations shall survive the termination of the undersigned’s employment.
6. No Action. The undersigned agrees that if the undersigned hereafter commences any suit arising out of, based upon, or relating to any of the Claims released hereunder or in any manner asserts against Releasees, or any of them, any of the Claims released hereunder, then the undersigned agrees to pay to Releasees, and each of them, in addition to any other damages caused to Releasees thereby, all attorneys’ fees incurred by Releasees in defending or otherwise responding to said suit or Claim.
7. No Admission. The undersigned further understands and agrees that neither the payment of any sum of money nor the execution of this Release shall constitute or be construed as an admission of any liability whatsoever by the Releasees, or any of them, who have consistently taken the position that they have no liability whatsoever to the undersigned.
8. OWBPA. The undersigned agrees and acknowledges that this Release constitutes a knowing and voluntary waiver and release of all Claims the undersigned has or may have against the Company and/or any of the Releasees as set forth herein, including, but not limited to, all Claims arising under the Older Workers Benefit Protection Act and the Age Discrimination in Employment Act. In accordance with the Older Workers Benefit Protection Act, the undersigned is hereby advised as follows:
(a) the undersigned has read the terms of this Release, and understands its terms and effects, including the fact that the undersigned agreed to release and forever discharge the Company and each of the Releasees, from any Claims released in this Release;
(b) the undersigned understands that, by entering into this Release, the undersigned
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does not waive any Claims that may arise after the date of the undersigned’s execution of this Release, including without limitation any rights or claims that the undersigned may have to secure enforcement of the terms and conditions of this Release;
(c) the undersigned has signed this Release voluntarily and knowingly in exchange for the consideration described in this Release, which the undersigned acknowledges is adequate and satisfactory to the undersigned and which the undersigned acknowledges is in addition to any other benefits to which the undersigned is otherwise entitled;
(d) the Company advises the undersigned to consult with an attorney prior to executing this Release;
(e) the undersigned has been given at least 21 days in which to review and consider this Release. To the extent that the undersigned chooses to sign this Release prior to the expiration of such period, the undersigned acknowledges that the undersigned has done so voluntarily, had sufficient time to consider the Release, to consult with counsel and that the undersigned does not desire additional time and hereby waives the remainder of the 21-day period; and
(f) the undersigned may revoke this Release within seven (7) days from the date the undersigned signs this Release and this Release will become effective upon the expiration of that revocation period if the undersigned has not revoked this Release during such seven-day period. If the undersigned revokes this Release during such seven-day period, this Release will be null and void and of no force or effect on either the Company or the undersigned and the undersigned will not be entitled to any of the payments or benefits which are expressly conditioned upon the execution and non-revocation of this Release. Any revocation must be in writing and sent to [name], via electronic mail at [email address], on or before 5:00 p.m. Pacific time on the seventh day after this Release is executed by the undersigned.]
9. Governing Law and Venue. This Release is deemed made and entered into in the State of Utah and in all respects shall be interpreted, enforced and governed under the internal laws of the State of Utah, to the extent not preempted by federal law. Any suit brought hereon shall be brought in the state or federal courts sitting in Salt Lake City, Utah, the parties hereby waiving any claim or defense that such forum is not convenient or proper. Each party hereby agrees that any such court shall have in personam jurisdiction over it and consents to service of process in any manner authorized by Utah law.
10. Severability. In the event any provision of this Release is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.
11. Counterparts. This Release may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement. This Release may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
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IN WITNESS WHEREOF, the undersigned has executed this Release this day of , .
|
|
| Robert Morse |
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EXHIBIT B
PARTNER ALUMNA/ALUMNUS AND PARTNER EMERITA/EMERITUS TERMS AND CONDITIONS
PARTNER ALUMNA/ALUMNUS:
Eligibility: To be eligible to be named as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive must:
(a) Have been a Partner in the Partnership for at least five years prior to the termination of the Employment Period,
(b) Unless otherwise determined by the Board, retain at least 60,000 shares of the Class A common stock of Parent (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable, or redeemable for, shares of Class A common stock of Parent (including interests of the Partnership));
(c) Timely sign and not revoke the Release; and
(d) Remain in compliance with the Agreement and the Restrictive Covenant Agreements and must not be employed by or consult with a competitor as determined solely by the Board.
Obligations: In order to continue to retain his or her status as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive must:
(a) Be available as a mentor for at least one high potential future leader;
(b) Be available for advice and counsel to the Company from time to time;
(c) As requested by the Board, be willing to serve on at least one Company committee (e.g., ESG, DE&I, etc.);
(d) Be willing to promote the Company and its investment vehicles as appropriate.
Benefits: During Executive’s period of service as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive shall be eligible to:
(a) Receive Company-arranged financing, to the extent generally available to employees of the Company, for acquiring limited-partner interests in Company-sponsored funds on terms generally available to employees;
(b) Receive a waiver of management fees or carried interest for any limited-partner investments in any Company-sponsored fund (up to a maximum of $5.0 million committed capital per fund);
(c) Be invited to attend summer and holiday Company parties; and
(d) Be invited to, and expected to attend, an annual reunion dinner hosted by the Chairman.
B-1
PARTNER EMERITA/EMERITUS:
Eligibility: To be eligible to be named as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive must:
(a) Have been a Partner in the Partnership for at least ten years prior to the termination of the Employment Period,
(b) Unless otherwise determined by the Board, retain at least 300,000 shares of the Class A common stock of Parent (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable, or redeemable for, shares of Class A common stock of Parent (including interests of the Partnership));
(c) Timely sign and not revoke the Release; and
(d) Remain in compliance with the Agreement and the Restrictive Covenant Agreements and must not be employed by or consult with a competitor as determined solely by the Board.
Obligations: In order to continue to retain his or her status as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive must:
(a) Be available as a mentor for up to two (simultaneous) high potential future leaders;
(b) Be available for advice and counsel to the Company from time to time;
(c) As requested by the Board, be willing to serve on at least one Company committee (e.g., ESG, DE&I, etc.);
(d) Be willing to promote the Company and its investment vehicles as appropriate.
Benefits: During Executive’s period of service as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive shall be eligible to:
(a) Receive Company-arranged financing, to the extent generally available to employees of the Company, for acquiring limited partner interests in Company-sponsored funds on terms generally available to employees;
(b) Receive a waiver of management fees or carried interest for any limited-partner investments in any Company-sponsored fund;
(c) Be invited to attend summer and holiday Company parties; and
(d) Be invited to, and expected to attend, an annual reunion dinner hosted by the Chairman.
B-2
Exhibit 10.9
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into by and among Bridge Investment Group Holdings Inc., a Delaware corporation (“Parent”), Bridge Investment Group Holdings LLC, a Delaware limited liability company (“Partnership”), Bridge Investment Group Employee Operations LLC, a Delaware limited liability company (“Operations”, and together with Parent, the Partnership, or any of the affiliates of Parent, the Partnership, and/or Operations as Executive may provide services to from time to time, and any successor(s) thereto, the “Company”) and Jonathan Slager (the “Executive”), and shall be effective as of the date on which Parent’s Registration Statement on Form S-1 filed in connection with Parent’s initial public offering becomes effective (the “Effective Date”).
WHEREAS, the Company desires to continue to employ the Executive and the Company and the Executive desire to enter into an agreement embodying the terms of such continued employment, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Effective upon the Effective Date, the Executive’s employment hereunder shall be for a term (the “Employment Period”) commencing on the Effective Date and continuing indefinitely until terminated in accordance with the terms of this Agreement. Notwithstanding anything to the contrary in the foregoing, the Executive’s employment hereunder is terminable at will by the Company or by the Executive at any time (for any reason or for no reason), subject to the provisions of Section 4 hereof.
2. Terms of Employment.
(a) Position and Duties.
(i) Role and Responsibilities. Executive shall continue to serve as the Chief Executive Officer of the Company and a Partner in the Partnership, and shall perform such employment duties as are usual and customary for such positions. In addition, Executive currently serves as a member of the Board of Directors of the Company (the “Board”). The Executive shall report directly to the Chairman of the Board (the “Chairman”). At the Company’s request, the Executive shall serve the Company and/or its subsidiaries and affiliates in other capacities in addition to the foregoing, consistent with the Executive’s position hereunder. In the event that the Executive, during the Employment Period, serves in any one or more of such additional capacities, the Executive’s compensation shall not be increased beyond that specified in Section 2(b) hereof, unless otherwise determined by the Board. In addition, in the event the Executive’s service in one or more of such additional capacities is terminated, the Executive’s compensation, as specified in Section 2(b) hereof, shall not be diminished or reduced in any manner as a result of such termination provided that the Executive otherwise remains employed under the terms of this Agreement, unless otherwise determined by the Board.
(ii) Exclusivity. During the Employment Period, and excluding any periods of leave to which the Executive may be entitled, the Executive agrees to devote his or her full business time and attention to the business and affairs of the Company. Notwithstanding the foregoing, during the Employment Period, it shall not be a violation of this Agreement for the Executive to: (A) serve on boards, committees or similar bodies of charitable or nonprofit organizations, (B) fulfill limited teaching, speaking and writing engagements, and (C) manage his or her personal investments, in each case, so long as such activities do not individually or in the aggregate materially interfere or conflict with the performance of the Executive’s duties and responsibilities under this Agreement; provided, that with respect to the activities in subclause (A), the Executive receives prior written approval from the Chairman.
(b) Compensation, Benefits, Etc.
(i) Base Salary. Effective as of the Effective Date and during the Employment Period, the Executive shall receive a base salary (the “Base Salary”) of $500,000 per annum. The Base Salary shall be paid in accordance with the Company’s normal payroll practices for executive salaries generally, but no less often than monthly and shall be pro-rated for partial years of employment. The Base Salary may be increased in the discretion of the Board or a subcommittee thereof, but not reduced, and the term “Base Salary” as utilized in this Agreement shall refer to the Base Salary as so increased.
(ii) Cash Bonus. For each calendar year ending during the Employment Period, the Executive shall be eligible to earn a cash performance bonus (a “Bonus”) under the Company’s bonus plan or program applicable to senior executives targeted at 145.475% of the Executive’s Base Salary. The actual amount of any Bonus shall be determined by the Board (or a subcommittee thereof) in its discretion, based on the achievement of individual and/or Company performance goals as determined by the Board (or a subcommittee thereof). The payment of any Bonus, to the extent any Bonus becomes payable, will be made on the date(s) on which semi-annual or annual bonuses are paid generally to the Company’s senior executives, subject to the Executive’s continued employment through the payment date.
(iii) IPO Equity Award. Upon the closing of Parent’s initial public offering, Parent shall issue to the Executive an award of 186,372 shares of restricted Class A common stock under Parent’s 2021 Incentive Award Plan. Except as otherwise provided herein, subject to Executive’s continued employment with the Company through each such date, the restricted stock award shall vest in three equal installments on each of the third, fourth and fifth anniversaries of the closing date of Parent’s initial public offering. The terms and conditions of the restricted stock award shall be set forth in an award agreement in a form prescribed by the Board to be entered into by the Company and Executive.
(iv) Carried Interest Awards. Executive shall be entitled to participate in such portion of the carried interest in the Company’s affiliated fund general partners as is determined by the Board. Except as otherwise provided herein, the terms and conditions of all carried interest awards will be set forth in the applicable partnership agreements and award letters.
(v) Benefits. During the Employment Period, the Executive (and the Executive’s spouse and/or eligible dependents to the extent provided in the applicable plans and programs) shall be eligible to participate in and be covered under the health and welfare benefit plans and programs maintained by the Company for the benefit of its employees from time to time, pursuant to the terms of such plans and programs including any medical, life, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs on the same terms and conditions as those applicable to similarly situated senior executives. In addition, during the Employment Period, the Executive shall be eligible to participate in any retirement, savings and other employee benefit plans and programs maintained from time to time by the Company for the benefit of its senior executive officers. Nothing contained in this Section 2(b)(v) shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
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(vi) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in connection with the performance of his or her duties under this Agreement in accordance with the policies, practices and procedures of the Company provided to employees of the Company.
(vii) Fringe Benefits. During the Employment Period, the Executive shall be eligible to receive such fringe benefits and perquisites as are provided by the Company to its employees from time to time, in accordance with the policies, practices and procedures of the Company, and shall receive such additional fringe benefits and perquisites as the Company may, in its discretion, from time-to-time provide.
(viii) Vacation/Paid Time Off. During the Employment Period, the Executive shall be entitled to vacation and/or paid time off in accordance with the plans, policies, programs and practices of the Company applicable to its senior executives.
3. Termination of Employment.
(a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. Either the Company or the Executive may terminate the Executive’s employment in the event of the Executive’s Disability during the Employment Period.
(b) Termination by the Company. The Company may terminate the Executive’s employment during the Employment Period for Cause or without Cause.
(c) Termination by the Executive. The Executive’s employment may be terminated by the Executive for any or no reason, including with Good Reason or by the Executive without Good Reason.
(d) Notice of Termination. Any termination of employment (other than due to the Executive’s death), shall be communicated by a Notice of Termination to the other parties hereto given in accordance with Section 11(b) hereof. The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
(e) Termination of Offices and Directorships; Return of Property. Upon termination of the Executive’s employment for any reason, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions, if any, then held with the Company, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive agrees to return to the Company all documents of the Company and its affiliates (and all copies thereof) and all other Company or Company affiliate property that the Executive has in his or her possession, custody or control. Such property includes, without limitation: (i) any materials of any kind that the Executive knows contain or embody any proprietary or confidential information of the Company or an affiliate of the Company (and all reproductions thereof), (ii) computers (including, but not limited to, laptop computers, desktop computers and similar devices) and other portable electronic devices (including, but not limited to, tablet computers), cellular phones/smartphones, credit cards, phone cards, entry cards, identification badges and keys, and (iii) any correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the business, clients, investors, customers, business plans, marketing strategies, products and/or processes of the Company or any of its affiliates and any information received from the Company or any of its affiliates regarding third parties.
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4. Obligations of the Company upon Termination.
(a) Accrued Obligations. In the event that the Executive’s employment under this Agreement terminates during the Employment Period for any reason, the Company will pay or provide to the Executive: (i) any earned but unpaid Base Salary and accrued but unused vacation or paid time off, and (ii) reimbursement of any business expenses incurred by the Executive prior to the Date of Termination that are reimbursable in accordance with Section 2(b)(vi) hereof (together, the “Accrued Obligations”). The Accrued Obligations described in clauses (i) – (ii) of the preceding sentence shall be paid within thirty (30) days after the Date of Termination (or such earlier date as may be required by applicable law).
(b) Qualifying Termination. Subject to Sections 4(e), 4(f), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof (including the Restrictive Covenants Agreement), if the Executive’s employment with the Company is terminated during the Employment Period due to a Qualifying Termination, then in addition to the Accrued Obligations:
(i) Cash Severance. The Company shall continue to pay Executive his or her Base Salary at the then-current rate per pay period for a period of twelve (12) months (the “Severance Period”) following the termination of the Employment Period, in accordance with the Company’s then-current payroll policies and practices. The foregoing severance payments shall commence on the first payroll period following the date Executive’s Release becomes effective (the “Payment Date”) and the first payment shall include all accrued amounts from the Date of Termination; provided, however, if upon Executive’s Qualifying Termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement (as such term is defined therein), then, in each pay period, any Base Salary to be provided pursuant to this Section 4(b)(i) shall be reduced by the amount of such Garden Leave Compensation also paid in such pay period.
(ii) COBRA. Unless Section 4(b)(v)(C) applies, in which case this section shall not apply, subject to the Executive’s valid election to continue healthcare coverage under Section 4980B of the Code, for the Severance Period, the Company shall continue to provide, during the Severance Period, the Executive and the Executive’s eligible dependents with coverage under its group health plans at the same levels and the same cost to the Executive as would have applied if the Executive’s employment had not been terminated based on the Executive’s elections in effect on the Date of Termination, provided, however, that (A) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the continuation coverage period (or the remaining portion thereof). If upon Executive’s Qualifying Termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement (as such term is defined therein), the healthcare coverage under this Section 4(b)(ii) shall not apply for any period during which reimbursement of COBRA premiums is provided to Executive as part of such Garden Leave Compensation in such period.
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(iii) Equity Acceleration. All outstanding Company equity awards that are held by the Executive on the Date of Termination (other than any carried interest awards) shall vest and, to the extent applicable, become exercisable on an accelerated basis as of the Date of Termination with respect to the number of shares underlying such award that would have vested (and become exercisable, if applicable) had the Executive remained in continuous service beyond the Date of Termination for the Severance Period. Notwithstanding the foregoing, in the event that the Qualifying Termination occurs on or within eighteen (18) months following a Change in Control, then all outstanding Company equity awards that are held by the Executive on the Date of Termination (other than any carried interest awards) shall become fully vested and, to the extent applicable, exercisable. Any remaining unvested Company equity awards after giving effect to the foregoing acceleration (other than any carried interest awards) shall be immediately forfeited for no consideration upon such termination. The foregoing provisions are hereby deemed to be a part of each equity award (and, for the avoidance of doubt, if any equity award is subject to more favorable vesting pursuant to any agreement or plan regarding such equity award, such more favorable provisions shall continue to apply and shall not be limited by this clause (iii)).
(v) Partner Alumna/Alumnus and Partner Emerita/Emeritus Status. Subject to Executive’s satisfaction of the requirements set forth in Exhibit B, Executive shall be eligible for:
(A) To the extent Executive satisfies the requirements for “Partner Alumna/Partner Alumnus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(B) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(C) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, for so long as Executive retains such “Partner Emerita/Emeritus” status (the “Partner Emerita/Emeritus Coverage Period”), the Company shall continue to provide, during the Partner Emeritus Coverage Period, the Executive and the Executive’s eligible dependents with coverage under its group health plans at the same levels and the same cost to the Executive as would have applied if the Executive’s employment had not been terminated based on the Executive’s elections in effect on the Date of Termination, which continuation coverage shall be provided, to the extent possible, under COBRA, provided, however, that (1) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (2) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the Partner Emerita/Emeritus Coverage Period (or the remaining portion thereof). If upon Executive’s termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement, the healthcare coverage under this Section 4(b)(v)(C) shall not apply for any period during which reimbursement of COBRA premiums is provided to Executive as part of such Garden Leave Compensation in such period.
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(D) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, and except to the extent a carried interest award agreement governing a carried interest award granted to Executive specifically provides for the treatment of such carried interest award in the event of Executive’s Qualifying Termination and provides that its terms shall supersede the provisions of this Section 4(b)(v), in which case the terms of such award agreement shall govern, seventy-five percent (75%) of the outstanding unvested carried interest awards held by Executive shall become fully vested upon the date of such termination. The foregoing provisions are hereby deemed to be a part of each carried interest award (and, for the avoidance of doubt, if any carried interest award is subject to more favorable vesting pursuant to any agreement or plan regarding such carried interest award, such more favorable provisions shall continue to apply and shall not be limited by this clause (v)(D)).
(c) Resignation Other than for Good Reason. Subject to Sections 4(c), 4(e), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof, if the Executive’s employment with the Company is terminated during the Employment Period due to Executive’s voluntary resignation other than for Good Reason, then in addition to the Accrued Obligations, subject to Executive’s satisfaction of the requirements set forth in Exhibit B, Executive shall be eligible for:
(i) To the extent Executive satisfies the requirements for “Partner Alumna/Partner Alumnus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(ii) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(iii) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits specified under Section 4(b)(v)(C) above.
(iv) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, and except to the extent a carried interest award agreement governing a carried interest award granted to Executive specifically provides for the treatment of such carried interest award in the event of Executive’s Qualifying Termination and provides that its terms shall supersede the provisions of this Section 4(c)(iv), in which case the terms of such award agreement shall govern, seventy-five percent (75%) of the outstanding unvested carried interest awards held by Executive shall become fully vested upon the date of such termination.
(d) Death or Disability. Subject to Sections 4(c), 4(e), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof, if the Executive’s employment with the Company is terminated during the Employment Period as a result of Executive’s death or Disability, then in addition to the Accrued Obligations:
(i) Equity Acceleration. All outstanding Company equity awards that are subject to time-based vesting conditions that are held by the Executive on the Date of Termination shall vest and, to the extent applicable, become exercisable on an accelerated basis as of the Date of Termination.
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(ii) Carried Interest Acceleration. All outstanding carried interest awards shall vest as of the Date of Termination.
(e) Release. Notwithstanding the foregoing, it shall be a condition to the Executive’s right to receive the amounts provided for in Sections 4(b), 4(c) or 4(d) hereof that the Executive execute and deliver to the Company an effective release of claims in substantially the form attached hereto as Exhibit A (the “Release”) within twenty-one (21) days (or, to the extent required by law, forty-five (45) days) following the Date of Termination and that the Executive not revoke such Release during any applicable revocation period. For the avoidance of doubt, all equity awards and/or carried interest awards eligible for accelerated vesting pursuant to Sections 4(b), 4(c) or 4(d) hereof shall remain outstanding and eligible to vest following the Date of Termination and shall actually vest and become exercisable (if applicable) and non-forfeitable upon the effectiveness of the Release.
(f) Other Terminations. If the Executive’s employment is terminated for any reason not described in Sections 4(b), 4(c) or 4(d) hereof, the Company will pay the Executive only the Accrued Obligations.
(g) Six-Month Delay. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits, including without limitation any severance payments or benefits payable under this Section 4, shall be paid to the Executive during the six-month period following the Executive’s Separation from Service if the Company determines that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first day of the seventh month following the date of Separation from Service (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of the Executive’s death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period.
(h) Exclusive Benefits. Except as expressly provided in this Section 4 and subject to Section 5 hereof, the Executive shall not be entitled to any additional payments or benefits upon or in connection with the Executive’s termination of employment.
5. Non-Exclusivity of Rights. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
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6. Restrictive Covenants.
(a) The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company and its subsidiaries and affiliates, which shall have been obtained by the Executive in connection with the Executive’s employment by the Company and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company, the Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data, to anyone other than the Company and those designated by it; provided, however, that if the Executive receives actual notice that the Executive is or may be required by law or legal process to communicate or divulge any such information, knowledge or data, the Executive shall promptly so notify the Company.
(b) While employed by the Company, the Executive shall not be engaged in any other business activity that would be competitive with the business of the Company and its subsidiaries or affiliates. In addition, while employed by the Company and for a period of twelve (12) months after the Date of Termination, the Executive shall not directly or indirectly solicit, induce, or encourage any employee or consultant of the Company and/or its subsidiaries and affiliates to terminate their employment or other relationship with the Company and its subsidiaries and affiliates or to cease to render services to the Company and/or its subsidiaries and affiliates and the Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity except, in each case, to the extent the foregoing occurs as a result of general advertisements or other solicitations not specifically targeted to such employees and consultants. During his or her employment with the Company and for a period of twelve (12) months after the Date of Termination, the Executive shall not use any trade secret of the Company or its subsidiaries or affiliates to solicit, induce, or encourage any customer, client, vendor, or other party doing business with any member of the Company and its subsidiaries and affiliates to terminate its relationship therewith or transfer its business from any member of the Company and its subsidiaries and affiliates and the Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity.
(c) Subject to Section 6(f), during the Executive’s service with the Company and thereafter, excepting any litigation between the parties, (i) the Executive agrees not to publish or disseminate, directly or indirectly, any statements, whether written or oral, that are or could be harmful to or reflect negatively on any of the Company or any of its subsidiaries or affiliates, or that are otherwise disparaging of any policies, procedures, practices, decision-making, conduct, professionalism or compliance with standards of the Company, its affiliates or any of their past or present officers, directors, employees, advisors or agents, and (ii) the Company agrees to instruct its directors and executive officers not to publish or disseminate, directly or indirectly, any statements, whether written or oral, that are or could be harmful to or reflect negatively on the Executive’s personal or business reputation or business.
(d) In recognition of the fact that irreparable injury will result to the Company in the event of a breach by the Executive of his or her obligations under Sections 6(a)-(c) hereof, that monetary damages for such breach would not be readily calculable, and that the Company would not have an adequate remedy at law therefor, the Executive acknowledges, consents and agrees that in the event of such breach, or the threat thereof, the Company shall be entitled, in addition to any other legal remedies and damages available, to specific performance thereof and to temporary and permanent injunctive relief (without the necessity of posting a bond) to restrain the violation or threatened violation of such obligations by the Executive and to cease the payment of any benefits under Section 4(b)-(c) above.
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(e) The Executive hereby acknowledges that the Executive has previously entered into the Company’s standard form of Non-Competition, Non-Solicitation and Non-Disclosure Agreement, containing confidentiality, intellectual property assignment and other protective covenants (the “Restrictive Covenant Agreement”), that the Executive shall continue to be bound by the terms and conditions of the Restrictive Covenant Agreement, and that such agreement shall be additional to, and not in limitation of, the covenants contained in this Section 6.
(f) Notwithstanding anything in this Agreement or the Restrictive Covenant Agreement to the contrary, nothing contained in this Agreement shall prohibit either party (or either party’s attorney(s)) from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the U.S. Commodity Futures Trading Commission, the U.S. Department of Justice or any other securities regulatory agency, self-regulatory authority or federal, state or local regulatory authority (collectively, “Government Agencies”), or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation, (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to any Government Agencies for the purpose of reporting or investigating a suspected violation of law, or from providing such information to such party’s attorney(s) or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding, and/or (iii) receiving an award for information provided to any Government Agency. Pursuant to 18 USC Section 1833(b), the Executive will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Further, nothing in this Agreement is intended to or shall preclude either party from providing truthful testimony in response to a valid subpoena, court order, regulatory request or other judicial, administrative or legal process or otherwise as required by law. If the Executive is required to provide testimony, then unless otherwise directed or requested by a Government Agency or law enforcement, the Executive shall notify the Company as soon as reasonably practicable after receiving any such request of the anticipated testimony.
7. Representations. The Executive hereby represents and warrants to the Company that (a) the Executive is entering into this Agreement voluntarily and that the performance of the Executive’s obligations hereunder will not violate any agreement between the Executive and any other person, firm, organization or other entity, and (b) the Executive is not bound by the terms of any agreement with any previous employer or other party to refrain from competing, directly or indirectly, with the business of such previous employer or other party that would be violated by the Executive’s entering into this Agreement and/or providing services to the Company pursuant to the terms of this Agreement.
8. Successors.
(a) This Agreement is personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon the Company and their respective successors and assigns.
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9. Section 280G of the Code.
(a) Best Pay Provision. In the event that any payment or benefit received or to be received by Executive pursuant to the terms of any plan, arrangement or agreement (including any payment or benefit received in connection with a change in ownership or control or the termination of Executive’s employment) (all such payments and benefits being hereinafter referred to as the “Total Payments”) would be subject (in whole or part) to the excise tax (the “Excise Tax”) imposed under Section 4999 of the Code, then the Total Payments shall be reduced to the extent necessary so that no portion of the Total Payments is subject to the Excise Tax but only if (i) the net amount of such Total Payments, as so reduced (after subtracting the amount of federal, state and local income taxes on such reduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced Total Payments) is greater than or equal to (ii) the net amount of such Total Payments without such reduction (after subtracting the net amount of federal, state and local income taxes on such Total Payments and the amount of Excise Tax to which Executive would be subject in respect of such unreduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced Total Payments). Except to the extent that an alternative reduction order would result in a greater economic benefit to the Executive on an after-tax basis, the parties intend that the Total Payments shall be reduced in the following order: (w) reduction of any cash severance payments otherwise payable to Executive that are exempt from Section 409A of the Code, (x) reduction of any other cash payments or benefits otherwise payable to Executive that are exempt from Section 409A of the Code, but excluding any payment attributable to the acceleration of vesting or payment with respect to any equity award that is exempt from Section 409A of the Code, (y) reduction of any other payments or benefits otherwise payable to Executive on a pro-rata basis or such other manner that complies with Section 409A of the Code, but excluding any payment attributable to the acceleration of vesting and payment with respect to any equity award that is exempt from Section 409A of the Code, and (z) reduction of any payments attributable to the acceleration of vesting or payment with respect to any equity award that is exempt from Section 409A of the Code; provided, in case of clauses (x), (y) and (z), that reduction of any payments or benefits attributable to the acceleration of vesting of Company equity awards shall be first applied to equity awards with later vesting dates; provided, further, that, notwithstanding the foregoing, any such reduction shall be undertaken in a manner that complies with and does not result in the imposition of additional taxes on the Executive under Section 409A of the Code. The foregoing reductions shall be made in a manner that results in the maximum economic benefit to Executive on an after-tax basis and, to the extent economically equivalent payments or benefits are subject to reduction, in a pro rata manner.
(b) Determinations. All determinations regarding the application of this Section 9 shall be made by an independent accounting firm or consulting group with nationally recognized standing and substantial expertise and experience in performing calculations regarding the applicability of Section 280G of the Code and the Excise Tax retained by the Company prior to the date of the applicable change in ownership or control (the “280G Firm”). For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax, (i) no portion of the Total Payments shall be taken into account which (x) does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, or (y) constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation, (ii) no portion of the Total Payments the receipt or enjoyment of which Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be taken into account, and (iii) the value of any non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by the 280G Firm in accordance with the principles of Sections 280G(d)(3) and (iv) of the Code. All determinations related to the calculations to be performed pursuant to this “Section 280G Treatment” section shall be done by the 280G Firm. The 280G Firm will be directed to submit its determination and detailed supporting calculations to both Executive and the Company within fifteen (15) days after notification from either the Company or Executive that Executive may receive payments which may be
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“parachute payments.” Executive and the Company will each provide the 280G Firm access to and copies of any books, records, and documents as may be reasonably requested by the 280G Firm, and otherwise cooperate with the 280G Firm in connection with the preparation and issuance of the determinations and calculations contemplated by this Agreement. The fees and expenses of the 280G Firm for its services in connection with the determinations and calculations contemplated by this Agreement will be borne solely by the Company.
10. Certain Definitions.
(a) “Board” means the Board of Directors of the Company.
(b) “Cause” means the occurrence of any one or more of the following events:
(i) the Executive’s willful failure to substantially perform his or her duties with the Company (other than any such failure resulting from the Executive’s incapacity due to physical or mental illness or any such actual or anticipated failure after his or her issuance of a Notice of Termination for Good Reason), including the Executive’s failure to follow any lawful directive from the Chairman within the reasonable scope of the Executive’s duties and the Executive’s failure to correct the same (if capable of correction, as determined by the Chairman), within thirty (30) days after a written notice is delivered to the Executive, which demand specifically identifies the manner in which the Chairman believes that the Executive has not performed his or her duties;
(ii) the Executive’s conviction of, indictment for or entry of a plea of guilty or nolo contendere to a felony crime (excluding vehicular crimes) or a crime of moral turpitude;
(iii) the Executive’s material breach of any material obligation under any written agreement with the Company or its affiliates or under any applicable policy of the Company or its affiliates (including any code of conduct or harassment policies), and the Executive’s failure to correct the same (if capable of correction, as determined by the Chairman), within thirty (30) days after a written notice is delivered to the Executive, which demand specifically identifies the manner in which the Chairman believes that the Executive has materially breached such agreement or policy;
(iv) any act of fraud, embezzlement, theft or misappropriation from the Company or its affiliates by the Executive;
(v) the Executive’s willful misconduct or gross negligence with respect to any material aspect of the Company’s business or a material breach by the Executive of his or her fiduciary duty to the Company or its affiliates, which willful misconduct, gross negligence or material breach has a material and demonstrable adverse effect on the Company or its affiliates; or
(vi) the Executive’s commission of an act of material dishonesty resulting in material reputational, economic or financial injury to the Company or its affiliates.
(a) “Change in Control” has the meaning set forth in the Plan. Notwithstanding the foregoing, in no event shall Parent’s initial public offering constitute a Change in Control and, if a Change in Control constitutes a payment event with respect to any amount hereunder that provides for the deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event shall only constitute a Change in Control for purposes of the payment timing of such amount if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5).
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(b) “Code” means the Internal Revenue Code of 1986, as amended, and the regulations thereunder.
(c) “Date of Termination” means the date on which the Executive’s employment with the Company terminates.
(d) “Disability” means that the Executive has become entitled to receive benefits under an applicable Company long-term disability plan or, if no such plan covers the Executive, as determined in the reasonable discretion of the Board.
(e) “Good Reason” means the occurrence of any one or more of the following events without the Executive’s prior written consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) as provided below:
(i) a material diminution in the Executive’s base compensation, unless such a reduction is imposed as part of a generalized reduction in the base salaries of senior management of the Company;
(ii) a material diminution in the Executive’s title, authority or duties, as contemplated by this Agreement; or
(iii) the Company’s material breach of this Agreement.
Notwithstanding the foregoing, the Executive will not be deemed to have resigned for Good Reason unless (1) the Executive provides the Company with written notice setting forth in reasonable detail the facts and circumstances claimed by the Executive to constitute Good Reason within thirty (30) days after the date of the occurrence of any event that the Executive knows or should reasonably have known to constitute Good Reason, (2) the Company fails to cure such acts or omissions within thirty (30) days following its receipt of such notice, and (3) the effective date of the Executive’s termination for Good Reason occurs no later than sixty (60) days after the expiration of the Company’s cure period.
(f) “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice unless as otherwise provided upon a termination for Good Reason).
(g) “Plan” means Parent’s 2021 Incentive Award Plan, as amended from time to time.
(h) “Qualifying Termination” means a termination of the Executive’s employment (i) by the Company without Cause (other than by reason of the Executive’s death or Disability), or (ii) by the Executive for Good Reason.
(i) “Section 409A” means Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.
(j) “Separation from Service” means a “separation from service” (within the meaning of Section 409A).
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11. Miscellaneous.
(a) Governing Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without reference to principles of conflict of laws. Any suit brought hereon shall be brought in the state or federal courts sitting in Salt Lake City, Utah, the parties hereby waiving any claim or defense that such forum is not convenient or proper. Each party hereby agrees that any such court shall have in personam jurisdiction over it and consents to service of process in any manner authorized by Utah law.
(b) Notices. Any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows with notice deemed given as indicated: (i) by personal delivery when delivered personally; (ii) by overnight courier upon written verification of receipt; (iii) by email upon acknowledgment of receipt of electronic transmission; or (iv) by certified or registered mail, return receipt requested, upon verification of receipt. Notice shall be sent to Executive at the address listed on the Company’s personnel records and to the Company at its principal place of business to the attention of the Company’s General Counsel, or such other address as either party may specify in writing.
(c) Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”), then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder.
(d) Section 409A of the Code.
(i) To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be subject to Section 409A, the Company shall work in good faith with the Executive to adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 11(d) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
(ii) Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
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(iii) To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
(e) Severability. In the event any provision of this Agreement is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.
(f) Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
(g) No Waiver. The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c) hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
(h) Entire Agreement. As of the Effective Date, this Agreement and the Restrictive Covenant Agreement constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, by any member of the Company and its subsidiaries or affiliates, or representative thereof. Notwithstanding anything herein to the contrary, this Agreement and the obligations and commitments hereunder shall neither commence nor be of any force or effect prior to the Effective Date.
(i) Arbitration. To aid in the rapid and economical resolution of any disputes that may arise in the course of the employment relationship, Executive and the Company agree that any and all disputes, claims, or demands in any way arising out of or relating to the terms of this Agreement, Company equity held by Executive, Executive’s employment relationship with the Company, or the termination of Executive’s employment or service relationship with the Company, shall be resolved, to the fullest extent permitted by law, by final, binding and confidential arbitration in Salt Lake City, Utah, conducted before a single neutral arbitrator selected and administered in accordance with the employment arbitration rules & procedures or then applicable equivalent rules of JAMS, Inc. (the “JAMS Rules”) and the Federal Arbitration Act, 9 U.S.C. Sec. 1, et seq. A copy of the JAMS rules may be found on the JAMS website at www.jamsadr.com and will be provided to Executive by the Company upon request. BY AGREEING TO THIS ARBITRATION PROCEDURE, EXECUTIVE AND THE COMPANY WAIVE THE RIGHT TO RESOLVE ANY SUCH DISPUTE, CLAIM OR DEMAND THROUGH A TRIAL BY JURY OR JUDGE OR BY ADMINISTRATIVE PROCEEDING IN ANY JURISDICTION. Executive will have the right to be represented by legal counsel at any arbitration proceeding, at Executive’s expense. The arbitrator shall: (a) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be available under applicable law in a court proceeding and (b) issue a written statement signed by the arbitrator regarding the disposition of each claim and the relief, if any, awarded as
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to each claim, the reasons for the award, and the arbitrator’s essential findings and conclusions on which the award is based. The parties agree that the prevailing party in any arbitration shall be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitration award. This Section 11(i) is intended to be the exclusive method for resolving any and all claims by the parties against each other for payment of damages under this Agreement or relating to Executive’s employment; provided, however, that Executive shall retain the right to file administrative charges with or seek relief through any government agency of competent jurisdiction, and to participate in any government investigation, including but not limited to (i) claims for workers’ compensation, state disability insurance or unemployment insurance; (ii) claims for unpaid wages or waiting time penalties brought before any governmental agency; provided, however, that any appeal from an award or from denial of an award of wages and/or waiting time penalties shall be arbitrated pursuant to the terms of this Agreement; and (iii) claims for administrative relief from the United States Equal Employment Opportunity Commission and/or the any similar agency in any applicable jurisdiction; provided, further, that Executive shall not be entitled to obtain any monetary relief through such agencies other than workers’ compensation benefits or unemployment insurance benefits. Nothing in this Agreement is intended to prevent either Executive or the Company from obtaining injunctive relief (or any other provisional remedy) in any court of competent jurisdiction pursuant to applicable law to prevent irreparable harm (including, without limitation, pending the conclusion of any arbitration). The Company shall pay the arbitrator’s fees, arbitration expenses and any other costs unique to the arbitration proceeding (recognizing that each side shall bear its own deposition, witness, expert and attorney’s fees and other expenses to the same extent as if the matter were being heard in court); provided, however, that the arbitrator may award attorney’s fees and costs to the prevailing party, except as prohibited by law.
THE EXECUTIVE AND THE COMPANY WAIVE ANY CONSTITUTIONAL OR OTHER RIGHT TO BRING CLAIMS COVERED BY THIS AGREEMENT OTHER THAN IN THEIR INDIVIDUAL CAPACITIES. EXCEPT AS MAY BE PROHIBITED BY LAW, THIS WAIVER INCLUDES THE ABILITY TO ASSERT CLAIMS AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING.
(j) Amendment; Survival; Construction. No amendment or other modification of this Agreement shall be effective unless made in writing and signed by the parties hereto. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.
(k) Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement. This Agreement may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.
| BRIDGE INVESTMENT GROUP HOLDINGS INC. | ||||
| By: |
/s/ Jonathan Slager |
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| Name: | Jonathan Slager | |||
| Title: | Chief Executive Officer | |||
| BRIDGE INVESTMENT GROUP HOLDINGS LLC | ||||
| By: |
/s/ Jonathan Slager |
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| Name: | Jonathan Slager | |||
| Title: | Authorized Signatory | |||
| BRIDGE INVESTMENT GROUP EMPLOYEE OPERATIONS LLC | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Authorized Signatory | |||
| “EXECUTIVE” |
|
/s/ Jonathan Slager |
|
Jonathan Slager |
[Signature Page to Employment Agreement]
EXHIBIT A
GENERAL RELEASE
1. Release For valuable consideration, the receipt and adequacy of which are hereby acknowledged, the undersigned does hereby release and forever discharge the “Releasees” hereunder, consisting of Bridge Investment Group Holdings Inc., a Delaware corporation (“Parent”), Bridge Investment Group Holdings LLC, a Delaware limited liability company (“Partnership”), Bridge Investment Group Employee Operations LLC, a Delaware limited liability company (“Operations”, and together with Parent, the Partnership, or any of the affiliates of Parent, the Partnership, and/or Operations as Executive may provide services to from time to time, and any successor(s) thereto, the “Company”), and the Company’s partners, subsidiaries, associates, affiliates, successors, heirs, assigns, agents, directors, officers, employees, representatives, lawyers, insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, losses, costs, attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called “Claims”), which the undersigned now has or may hereafter have against the Releasees, or any of them, by reason of any matter, cause, or thing whatsoever from the beginning of time to the date hereof. The Claims released herein include, without limiting the generality of the foregoing, any Claims in any way arising out of, based upon, or related to the employment or termination of employment of the undersigned by the Releasees, or any of them; any alleged breach of any express or implied contract of employment; any alleged torts or other alleged legal restrictions on Releasees’ right to terminate the employment of the undersigned; and any alleged violation of any federal, state or local statute or ordinance including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act, the Americans With Disabilities Act.
2. Claims Not Released. Notwithstanding the foregoing, this general release (the “Release”) shall not operate to release any rights or claims of the undersigned (i) to payments or benefits under Section 4(b)-(d) of that certain Employment Agreement, dated as of July 6, 2021, between the Company and the undersigned (the “Employment Agreement”), with respect to the payments and benefits provided in exchange for this Release, (ii) to payments or benefits under any equity award agreement between the undersigned and the Company, (iii) with respect to Section 2(b)(vi) of the Employment Agreement, (iv) to accrued or vested benefits the undersigned may have, if any, as of the date hereof under any applicable plan, policy, practice, program, contract or agreement with the Company, (v) to any Claims, including Claims for indemnification and/or advancement of expenses arising under any indemnification agreement between the undersigned and the Company or under the bylaws, certificate of incorporation or other similar governing document of the Company, (vi) to any Claims which cannot be waived by an employee under applicable law or (vii) with respect to the undersigned’s right to communicate directly with, cooperate with, or provide information to, any federal, state or local government regulator.
3. Unknown Claims. THE UNDERSIGNED ACKNOWLEDGES THAT THE UNDERSIGNED HAS BEEN ADVISED BY LEGAL COUNSEL AND IS FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
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THE UNDERSIGNED, BEING AWARE OF SAID CODE SECTION, HEREBY EXPRESSLY WAIVES ANY RIGHTS THE UNDERSIGNED MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.
4. Exceptions. Notwithstanding anything in this Release to the contrary, nothing contained in this Release shall prohibit the undersigned from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with any governmental agency or entity or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation and/or (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to, any federal, state or local government regulator (including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice) for the purpose of reporting or investigating a suspected violation of law, or from providing such information to the undersigned’s attorney or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding. Pursuant to 18 USC Section 1833(b), the undersigned will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
5. Representations; Continuing Obligations. The undersigned represents and warrants that there has been no assignment or other transfer of any interest in any Claim which the undersigned may have against Releasees, or any of them, and the undersigned agrees to indemnify and hold Releasees, and each of them, harmless from any liability, Claims, demands, damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of them, as the result of any such assignment or transfer or any rights or Claims under any such assignment or transfer. It is the intention of the parties that this indemnity does not require payment as a condition precedent to recovery by the Releasees against the undersigned under this indemnity. The undersigned hereby expressly reaffirms his obligations under Section 6 of the Employment Agreement, and agrees that such obligations shall survive the termination of the undersigned’s employment.
6. No Action. The undersigned agrees that if the undersigned hereafter commences any suit arising out of, based upon, or relating to any of the Claims released hereunder or in any manner asserts against Releasees, or any of them, any of the Claims released hereunder, then the undersigned agrees to pay to Releasees, and each of them, in addition to any other damages caused to Releasees thereby, all attorneys’ fees incurred by Releasees in defending or otherwise responding to said suit or Claim.
7. No Admission. The undersigned further understands and agrees that neither the payment of any sum of money nor the execution of this Release shall constitute or be construed as an admission of any liability whatsoever by the Releasees, or any of them, who have consistently taken the position that they have no liability whatsoever to the undersigned.
8. OWBPA. The undersigned agrees and acknowledges that this Release constitutes a knowing and voluntary waiver and release of all Claims the undersigned has or may have against the Company and/or any of the Releasees as set forth herein, including, but not limited to, all Claims arising under the Older Workers Benefit Protection Act and the Age Discrimination in Employment Act. In accordance with the Older Workers Benefit Protection Act, the undersigned is hereby advised as follows:
(a) the undersigned has read the terms of this Release, and understands its terms and effects, including the fact that the undersigned agreed to release and forever discharge the Company and each of the Releasees, from any Claims released in this Release;
(b) the undersigned understands that, by entering into this Release, the undersigned
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does not waive any Claims that may arise after the date of the undersigned’s execution of this Release, including without limitation any rights or claims that the undersigned may have to secure enforcement of the terms and conditions of this Release;
(c) the undersigned has signed this Release voluntarily and knowingly in exchange for the consideration described in this Release, which the undersigned acknowledges is adequate and satisfactory to the undersigned and which the undersigned acknowledges is in addition to any other benefits to which the undersigned is otherwise entitled;
(d) the Company advises the undersigned to consult with an attorney prior to executing this Release;
(e) the undersigned has been given at least 21 days in which to review and consider this Release. To the extent that the undersigned chooses to sign this Release prior to the expiration of such period, the undersigned acknowledges that the undersigned has done so voluntarily, had sufficient time to consider the Release, to consult with counsel and that the undersigned does not desire additional time and hereby waives the remainder of the 21-day period; and
(f) the undersigned may revoke this Release within seven (7) days from the date the undersigned signs this Release and this Release will become effective upon the expiration of that revocation period if the undersigned has not revoked this Release during such seven-day period. If the undersigned revokes this Release during such seven-day period, this Release will be null and void and of no force or effect on either the Company or the undersigned and the undersigned will not be entitled to any of the payments or benefits which are expressly conditioned upon the execution and non-revocation of this Release. Any revocation must be in writing and sent to [name], via electronic mail at [email address], on or before 5:00 p.m. Pacific time on the seventh day after this Release is executed by the undersigned.]
9. Governing Law and Venue. This Release is deemed made and entered into in the State of Utah and in all respects shall be interpreted, enforced and governed under the internal laws of the State of Utah, to the extent not preempted by federal law. Any suit brought hereon shall be brought in the state or federal courts sitting in Salt Lake City, Utah, the parties hereby waiving any claim or defense that such forum is not convenient or proper. Each party hereby agrees that any such court shall have in personam jurisdiction over it and consents to service of process in any manner authorized by Utah law.
10. Severability. In the event any provision of this Release is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.
11. Counterparts. This Release may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement. This Release may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
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IN WITNESS WHEREOF, the undersigned has executed this Release this day of , .
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| Jonathan Slager |
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EXHIBIT B
PARTNER ALUMNA/ALUMNUS AND PARTNER EMERITA/EMERITUS TERMS AND CONDITIONS
PARTNER ALUMNA/ALUMNUS:
Eligibility: To be eligible to be named as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive must:
(a) Have been a Partner in the Partnership for at least five years prior to the termination of the Employment Period,
(b) Unless otherwise determined by the Board, retain at least 60,000 shares of the Class A common stock of Parent (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable, or redeemable for, shares of Class A common stock of Parent (including interests of the Partnership));
(c) Timely sign and not revoke the Release; and
(d) Remain in compliance with the Agreement and the Restrictive Covenant Agreements and must not be employed by or consult with a competitor as determined solely by the Board.
Obligations: In order to continue to retain his or her status as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive must:
(a) Be available as a mentor for at least one high potential future leader;
(b) Be available for advice and counsel to the Company from time to time;
(c) As requested by the Board, be willing to serve on at least one Company committee (e.g., ESG, DE&I, etc.);
(d) Be willing to promote the Company and its investment vehicles as appropriate.
Benefits: During Executive’s period of service as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive shall be eligible to:
(a) Receive Company-arranged financing, to the extent generally available to employees of the Company, for acquiring limited-partner interests in Company-sponsored funds on terms generally available to employees;
(b) Receive a waiver of management fees or carried interest for any limited-partner investments in any Company-sponsored fund (up to a maximum of $5.0 million committed capital per fund);
(c) Be invited to attend summer and holiday Company parties; and
(d) Be invited to, and expected to attend, an annual reunion dinner hosted by the Chairman.
B-1
PARTNER EMERITA/EMERITUS:
Eligibility: To be eligible to be named as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive must:
(a) Have been a Partner in the Partnership for at least ten years prior to the termination of the Employment Period,
(b) Unless otherwise determined by the Board, retain at least 300,000 shares of the Class A common stock of Parent (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable, or redeemable for, shares of Class A common stock of Parent (including interests of the Partnership));
(c) Timely sign and not revoke the Release; and
(d) Remain in compliance with the Agreement and the Restrictive Covenant Agreements and must not be employed by or consult with a competitor as determined solely by the Board.
Obligations: In order to continue to retain his or her status as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive must:
(a) Be available as a mentor for up to two (simultaneous) high potential future leaders;
(b) Be available for advice and counsel to the Company from time to time;
(c) As requested by the Board, be willing to serve on at least one Company committee (e.g., ESG, DE&I, etc.);
(d) Be willing to promote the Company and its investment vehicles as appropriate.
Benefits: During Executive’s period of service as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive shall be eligible to:
(a) Receive Company-arranged financing, to the extent generally available to employees of the Company, for acquiring limited partner interests in Company-sponsored funds on terms generally available to employees;
(b) Receive a waiver of management fees or carried interest for any limited-partner investments in any Company-sponsored fund;
(c) Be invited to attend summer and holiday Company parties; and
(d) Be invited to, and expected to attend, an annual reunion dinner hosted by the Chairman.
B-2
Exhibit 10.10
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into by and among Bridge Investment Group Holdings Inc., a Delaware corporation (“Parent”), Bridge Investment Group Holdings LLC, a Delaware limited liability company (“Partnership”), Bridge Investment Group Employee Operations LLC, a Delaware limited liability company (“Operations”, and together with Parent, the Partnership, or any of the affiliates of Parent, the Partnership, and/or Operations as Executive may provide services to from time to time, and any successor(s) thereto, the “Company”) and Adam O’Farrell (the “Executive”), and shall be effective as of the date on which Parent’s Registration Statement on Form S-1 filed in connection with Parent’s initial public offering becomes effective (the “Effective Date”).
WHEREAS, the Company desires to continue to employ the Executive and the Company and the Executive desire to enter into an agreement embodying the terms of such continued employment, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Effective upon the Effective Date, the Executive’s employment hereunder shall be for a term (the “Employment Period”) commencing on the Effective Date and continuing indefinitely until terminated in accordance with the terms of this Agreement. Notwithstanding anything to the contrary in the foregoing, the Executive’s employment hereunder is terminable at will by the Company or by the Executive at any time (for any reason or for no reason), subject to the provisions of Section 4 hereof.
2. Terms of Employment.
(a) Position and Duties.
(i) Role and Responsibilities. Executive shall continue to serve as the Chief Operating Officer of the Company and a Partner in the Partnership, and shall perform such employment duties as are usual and customary for such positions. In addition, Executive currently serves as a member of the Board of Directors of the Company (the “Board”). The Executive shall report directly to the Chief Executive Officer (the “CEO”) of the Company. At the Company’s request, the Executive shall serve the Company and/or its subsidiaries and affiliates in other capacities in addition to the foregoing, consistent with the Executive’s position hereunder. In the event that the Executive, during the Employment Period, serves in any one or more of such additional capacities, the Executive’s compensation shall not be increased beyond that specified in Section 2(b) hereof, unless otherwise determined by the Board. In addition, in the event the Executive’s service in one or more of such additional capacities is terminated, the Executive’s compensation, as specified in Section 2(b) hereof, shall not be diminished or reduced in any manner as a result of such termination provided that the Executive otherwise remains employed under the terms of this Agreement, unless otherwise determined by the Board.
(ii) Exclusivity. During the Employment Period, and excluding any periods of leave to which the Executive may be entitled, the Executive agrees to devote his or her full business time and attention to the business and affairs of the Company. Notwithstanding the foregoing, during the Employment Period, it shall not be a violation of this Agreement for the Executive to: (A) serve on boards, committees or similar bodies of charitable or nonprofit organizations, (B) fulfill limited teaching, speaking and writing engagements, and (C) manage his or her personal investments, in each case, so long as such activities do not individually or in the aggregate materially interfere or conflict with the performance of the Executive’s duties and responsibilities under this Agreement; provided, that with respect to the activities in subclause (A), the Executive receives prior written approval from the CEO.
(b) Compensation, Benefits, Etc.
(i) Base Salary. Effective as of the Effective Date and during the Employment Period, the Executive shall receive a base salary (the “Base Salary”) of $500,000 per annum. The Base Salary shall be paid in accordance with the Company’s normal payroll practices for executive salaries generally, but no less often than monthly and shall be pro-rated for partial years of employment. The Base Salary may be increased in the discretion of the Board or a subcommittee thereof, but not reduced, and the term “Base Salary” as utilized in this Agreement shall refer to the Base Salary as so increased.
(ii) Cash Bonus. For each calendar year ending during the Employment Period, the Executive shall be eligible to earn a cash performance bonus (a “Bonus”) under the Company’s bonus plan or program applicable to senior executives targeted at 145.475% of the Executive’s Base Salary. The actual amount of any Bonus shall be determined by the Board (or a subcommittee thereof) in its discretion, based on the achievement of individual and/or Company performance goals as determined by the Board (or a subcommittee thereof). The payment of any Bonus, to the extent any Bonus becomes payable, will be made on the date(s) on which semi-annual or annual bonuses are paid generally to the Company’s senior executives, subject to the Executive’s continued employment through the payment date.
(iii) IPO Equity Award. Upon the closing of Parent’s initial public offering, Parent shall issue to the Executive an award of 109,631 shares of restricted Class A common stock under Parent’s 2021 Incentive Award Plan. Except as otherwise provided herein, subject to Executive’s continued employment with the Company through each such date, the restricted stock award shall vest in three equal installments on each of the third, fourth and fifth anniversaries of the closing date of Parent’s initial public offering. The terms and conditions of the restricted stock award shall be set forth in an award agreement in a form prescribed by the Board to be entered into by the Company and Executive.
(iv) Carried Interest Awards. Executive shall be entitled to participate in such portion of the carried interest in the Company’s affiliated fund general partners as is determined by the Board. Except as otherwise provided herein, the terms and conditions of all carried interest awards will be set forth in the applicable partnership agreements and award letters.
(v) Benefits. During the Employment Period, the Executive (and the Executive’s spouse and/or eligible dependents to the extent provided in the applicable plans and programs) shall be eligible to participate in and be covered under the health and welfare benefit plans and programs maintained by the Company for the benefit of its employees from time to time, pursuant to the terms of such plans and programs including any medical, life, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs on the same terms and conditions as those applicable to similarly situated senior executives. In addition, during the Employment Period, the Executive shall be eligible to participate in any retirement, savings and other employee benefit plans and programs maintained from time to time by the Company for the benefit of its senior executive officers. Nothing contained in this Section 2(b)(v) shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
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(vi) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in connection with the performance of his or her duties under this Agreement in accordance with the policies, practices and procedures of the Company provided to employees of the Company.
(vii) Fringe Benefits. During the Employment Period, the Executive shall be eligible to receive such fringe benefits and perquisites as are provided by the Company to its employees from time to time, in accordance with the policies, practices and procedures of the Company, and shall receive such additional fringe benefits and perquisites as the Company may, in its discretion, from time-to-time provide.
(viii) Vacation/Paid Time Off. During the Employment Period, the Executive shall be entitled to vacation and/or paid time off in accordance with the plans, policies, programs and practices of the Company applicable to its senior executives.
3. Termination of Employment.
(a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. Either the Company or the Executive may terminate the Executive’s employment in the event of the Executive’s Disability during the Employment Period.
(b) Termination by the Company. The Company may terminate the Executive’s employment during the Employment Period for Cause or without Cause.
(c) Termination by the Executive. The Executive’s employment may be terminated by the Executive for any or no reason, including with Good Reason or by the Executive without Good Reason.
(d) Notice of Termination. Any termination of employment (other than due to the Executive’s death), shall be communicated by a Notice of Termination to the other parties hereto given in accordance with Section 11(b) hereof. The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
(e) Termination of Offices and Directorships; Return of Property. Upon termination of the Executive’s employment for any reason, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions, if any, then held with the Company, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive agrees to return to the Company all documents of the Company and its affiliates (and all copies thereof) and all other Company or Company affiliate property that the Executive has in his or her possession, custody or control. Such property includes, without limitation: (i) any materials of any kind that the Executive knows contain or embody any proprietary or confidential information of the Company or an affiliate of the Company (and all reproductions thereof), (ii) computers (including, but not limited to, laptop computers, desktop computers and similar devices) and other portable electronic devices (including, but not limited to, tablet computers), cellular phones/smartphones, credit cards, phone cards, entry cards, identification badges and keys, and (iii) any correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the business, clients, investors, customers, business plans, marketing strategies, products and/or processes of the Company or any of its affiliates and any information received from the Company or any of its affiliates regarding third parties.
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4. Obligations of the Company upon Termination.
(a) Accrued Obligations. In the event that the Executive’s employment under this Agreement terminates during the Employment Period for any reason, the Company will pay or provide to the Executive: (i) any earned but unpaid Base Salary and accrued but unused vacation or paid time off, and (ii) reimbursement of any business expenses incurred by the Executive prior to the Date of Termination that are reimbursable in accordance with Section 2(b)(vi) hereof (together, the “Accrued Obligations”). The Accrued Obligations described in clauses (i) – (ii) of the preceding sentence shall be paid within thirty (30) days after the Date of Termination (or such earlier date as may be required by applicable law).
(b) Qualifying Termination. Subject to Sections 4(e), 4(f), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof (including the Restrictive Covenants Agreement), if the Executive’s employment with the Company is terminated during the Employment Period due to a Qualifying Termination, then in addition to the Accrued Obligations:
(i) Cash Severance. The Company shall continue to pay Executive his or her Base Salary at the then-current rate per pay period for a period of twelve (12) months (the “Severance Period”) following the termination of the Employment Period, in accordance with the Company’s then-current payroll policies and practices. The foregoing severance payments shall commence on the first payroll period following the date Executive’s Release becomes effective (the “Payment Date”) and the first payment shall include all accrued amounts from the Date of Termination; provided, however, if upon Executive’s Qualifying Termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement (as such term is defined therein), then, in each pay period, any Base Salary to be provided pursuant to this Section 4(b)(i) shall be reduced by the amount of such Garden Leave Compensation also paid in such pay period.
(ii) COBRA. Unless Section 4(b)(v)(C) applies, in which case this section shall not apply, subject to the Executive’s valid election to continue healthcare coverage under Section 4980B of the Code, for the Severance Period, the Company shall continue to provide, during the Severance Period, the Executive and the Executive’s eligible dependents with coverage under its group health plans at the same levels and the same cost to the Executive as would have applied if the Executive’s employment had not been terminated based on the Executive’s elections in effect on the Date of Termination, provided, however, that (A) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the continuation coverage period (or the remaining portion thereof). If upon Executive’s Qualifying Termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement (as such term is defined therein), the healthcare coverage under this Section 4(b)(ii) shall not apply for any period during which reimbursement of COBRA premiums is provided to Executive as part of such Garden Leave Compensation in such period.
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(iii) Equity Acceleration. All outstanding Company equity awards that are held by the Executive on the Date of Termination (other than any carried interest awards) shall vest and, to the extent applicable, become exercisable on an accelerated basis as of the Date of Termination with respect to the number of shares underlying such award that would have vested (and become exercisable, if applicable) had the Executive remained in continuous service beyond the Date of Termination for the Severance Period. Notwithstanding the foregoing, in the event that the Qualifying Termination occurs on or within eighteen (18) months following a Change in Control, then all outstanding Company equity awards that are held by the Executive on the Date of Termination (other than any carried interest awards) shall become fully vested and, to the extent applicable, exercisable. Any remaining unvested Company equity awards after giving effect to the foregoing acceleration (other than any carried interest awards) shall be immediately forfeited for no consideration upon such termination. The foregoing provisions are hereby deemed to be a part of each equity award (and, for the avoidance of doubt, if any equity award is subject to more favorable vesting pursuant to any agreement or plan regarding such equity award, such more favorable provisions shall continue to apply and shall not be limited by this clause (iii)).
(v) Partner Alumna/Alumnus and Partner Emerita/Emeritus Status. Subject to Executive’s satisfaction of the requirements set forth in Exhibit B, Executive shall be eligible for:
(A) To the extent Executive satisfies the requirements for “Partner Alumna/Partner Alumnus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(B) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(C) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, for so long as Executive retains such “Partner Emerita/Emeritus” status (the “Partner Emerita/Emeritus Coverage Period”), the Company shall continue to provide, during the Partner Emeritus Coverage Period, the Executive and the Executive’s eligible dependents with coverage under its group health plans at the same levels and the same cost to the Executive as would have applied if the Executive’s employment had not been terminated based on the Executive’s elections in effect on the Date of Termination, which continuation coverage shall be provided, to the extent possible, under COBRA, provided, however, that (1) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (2) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the Partner Emerita/Emeritus Coverage Period (or the remaining portion thereof). If upon Executive’s termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement, the healthcare coverage under this Section 4(b)(v)(C) shall not apply for any period during which reimbursement of COBRA premiums is provided to Executive as part of such Garden Leave Compensation in such period.
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(D) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, and except to the extent a carried interest award agreement governing a carried interest award granted to Executive specifically provides for the treatment of such carried interest award in the event of Executive’s Qualifying Termination and provides that its terms shall supersede the provisions of this Section 4(b)(v), in which case the terms of such award agreement shall govern, seventy-five percent (75%) of the outstanding unvested carried interest awards held by Executive shall become fully vested upon the date of such termination. The foregoing provisions are hereby deemed to be a part of each carried interest award (and, for the avoidance of doubt, if any carried interest award is subject to more favorable vesting pursuant to any agreement or plan regarding such carried interest award, such more favorable provisions shall continue to apply and shall not be limited by this clause (v)(D)).
(c) Resignation Other than for Good Reason. Subject to Sections 4(c), 4(e), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof, if the Executive’s employment with the Company is terminated during the Employment Period due to Executive’s voluntary resignation other than for Good Reason, then in addition to the Accrued Obligations, subject to Executive’s satisfaction of the requirements set forth in Exhibit B, Executive shall be eligible for:
(i) To the extent Executive satisfies the requirements for “Partner Alumna/Partner Alumnus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(ii) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(iii) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits specified under Section 4(b)(v)(C) above.
(iv) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, and except to the extent a carried interest award agreement governing a carried interest award granted to Executive specifically provides for the treatment of such carried interest award in the event of Executive’s Qualifying Termination and provides that its terms shall supersede the provisions of this Section 4(c)(iv), in which case the terms of such award agreement shall govern, seventy-five percent (75%) of the outstanding unvested carried interest awards held by Executive shall become fully vested upon the date of such termination.
(d) Death or Disability. Subject to Sections 4(c), 4(e), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof, if the Executive’s employment with the Company is terminated during the Employment Period as a result of Executive’s death or Disability, then in addition to the Accrued Obligations:
(i) Equity Acceleration. All outstanding Company equity awards that are subject to time-based vesting conditions that are held by the Executive on the Date of Termination shall vest and, to the extent applicable, become exercisable on an accelerated basis as of the Date of Termination.
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(ii) Carried Interest Acceleration. All outstanding carried interest awards shall vest as of the Date of Termination.
(e) Release. Notwithstanding the foregoing, it shall be a condition to the Executive’s right to receive the amounts provided for in Sections 4(b), 4(c) or 4(d) hereof that the Executive execute and deliver to the Company an effective release of claims in substantially the form attached hereto as Exhibit A (the “Release”) within twenty-one (21) days (or, to the extent required by law, forty-five (45) days) following the Date of Termination and that the Executive not revoke such Release during any applicable revocation period. For the avoidance of doubt, all equity awards and/or carried interest awards eligible for accelerated vesting pursuant to Sections 4(b), 4(c) or 4(d) hereof shall remain outstanding and eligible to vest following the Date of Termination and shall actually vest and become exercisable (if applicable) and non-forfeitable upon the effectiveness of the Release.
(f) Other Terminations. If the Executive’s employment is terminated for any reason not described in Sections 4(b), 4(c) or 4(d) hereof, the Company will pay the Executive only the Accrued Obligations.
(g) Six-Month Delay. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits, including without limitation any severance payments or benefits payable under this Section 4, shall be paid to the Executive during the six-month period following the Executive’s Separation from Service if the Company determines that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first day of the seventh month following the date of Separation from Service (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of the Executive’s death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period.
(h) Exclusive Benefits. Except as expressly provided in this Section 4 and subject to Section 5 hereof, the Executive shall not be entitled to any additional payments or benefits upon or in connection with the Executive’s termination of employment.
5. Non-Exclusivity of Rights. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
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6. Restrictive Covenants.
(a) The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company and its subsidiaries and affiliates, which shall have been obtained by the Executive in connection with the Executive’s employment by the Company and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company, the Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data, to anyone other than the Company and those designated by it; provided, however, that if the Executive receives actual notice that the Executive is or may be required by law or legal process to communicate or divulge any such information, knowledge or data, the Executive shall promptly so notify the Company.
(b) While employed by the Company, the Executive shall not be engaged in any other business activity that would be competitive with the business of the Company and its subsidiaries or affiliates. In addition, while employed by the Company and for a period of twelve (12) months after the Date of Termination, the Executive shall not directly or indirectly solicit, induce, or encourage any employee or consultant of the Company and/or its subsidiaries and affiliates to terminate their employment or other relationship with the Company and its subsidiaries and affiliates or to cease to render services to the Company and/or its subsidiaries and affiliates and the Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity except, in each case, to the extent the foregoing occurs as a result of general advertisements or other solicitations not specifically targeted to such employees and consultants. During his or her employment with the Company and for a period of twelve (12) months after the Date of Termination, the Executive shall not use any trade secret of the Company or its subsidiaries or affiliates to solicit, induce, or encourage any customer, client, vendor, or other party doing business with any member of the Company and its subsidiaries and affiliates to terminate its relationship therewith or transfer its business from any member of the Company and its subsidiaries and affiliates and the Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity.
(c) Subject to Section 6(f), during the Executive’s service with the Company and thereafter, excepting any litigation between the parties, (i) the Executive agrees not to publish or disseminate, directly or indirectly, any statements, whether written or oral, that are or could be harmful to or reflect negatively on any of the Company or any of its subsidiaries or affiliates, or that are otherwise disparaging of any policies, procedures, practices, decision-making, conduct, professionalism or compliance with standards of the Company, its affiliates or any of their past or present officers, directors, employees, advisors or agents, and (ii) the Company agrees to instruct its directors and executive officers not to publish or disseminate, directly or indirectly, any statements, whether written or oral, that are or could be harmful to or reflect negatively on the Executive’s personal or business reputation or business.
(d) In recognition of the fact that irreparable injury will result to the Company in the event of a breach by the Executive of his or her obligations under Sections 6(a)-(c) hereof, that monetary damages for such breach would not be readily calculable, and that the Company would not have an adequate remedy at law therefor, the Executive acknowledges, consents and agrees that in the event of such breach, or the threat thereof, the Company shall be entitled, in addition to any other legal remedies and damages available, to specific performance thereof and to temporary and permanent injunctive relief (without the necessity of posting a bond) to restrain the violation or threatened violation of such obligations by the Executive and to cease the payment of any benefits under Section 4(b)-(c) above.
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(e) The Executive hereby acknowledges that the Executive has previously entered into the Company’s standard form of Non-Competition, Non-Solicitation and Non-Disclosure Agreement, containing confidentiality, intellectual property assignment and other protective covenants (the “Restrictive Covenant Agreement”), that the Executive shall continue to be bound by the terms and conditions of the Restrictive Covenant Agreement, and that such agreement shall be additional to, and not in limitation of, the covenants contained in this Section 6.
(f) Notwithstanding anything in this Agreement or the Restrictive Covenant Agreement to the contrary, nothing contained in this Agreement shall prohibit either party (or either party’s attorney(s)) from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the U.S. Commodity Futures Trading Commission, the U.S. Department of Justice or any other securities regulatory agency, self-regulatory authority or federal, state or local regulatory authority (collectively, “Government Agencies”), or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation, (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to any Government Agencies for the purpose of reporting or investigating a suspected violation of law, or from providing such information to such party’s attorney(s) or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding, and/or (iii) receiving an award for information provided to any Government Agency. Pursuant to 18 USC Section 1833(b), the Executive will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Further, nothing in this Agreement is intended to or shall preclude either party from providing truthful testimony in response to a valid subpoena, court order, regulatory request or other judicial, administrative or legal process or otherwise as required by law. If the Executive is required to provide testimony, then unless otherwise directed or requested by a Government Agency or law enforcement, the Executive shall notify the Company as soon as reasonably practicable after receiving any such request of the anticipated testimony.
7. Representations. The Executive hereby represents and warrants to the Company that (a) the Executive is entering into this Agreement voluntarily and that the performance of the Executive’s obligations hereunder will not violate any agreement between the Executive and any other person, firm, organization or other entity, and (b) the Executive is not bound by the terms of any agreement with any previous employer or other party to refrain from competing, directly or indirectly, with the business of such previous employer or other party that would be violated by the Executive’s entering into this Agreement and/or providing services to the Company pursuant to the terms of this Agreement.
8. Successors.
(a) This Agreement is personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon the Company and their respective successors and assigns.
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9. Section 280G of the Code.
(a) Best Pay Provision. In the event that any payment or benefit received or to be received by Executive pursuant to the terms of any plan, arrangement or agreement (including any payment or benefit received in connection with a change in ownership or control or the termination of Executive’s employment) (all such payments and benefits being hereinafter referred to as the “Total Payments”) would be subject (in whole or part) to the excise tax (the “Excise Tax”) imposed under Section 4999 of the Code, then the Total Payments shall be reduced to the extent necessary so that no portion of the Total Payments is subject to the Excise Tax but only if (i) the net amount of such Total Payments, as so reduced (after subtracting the amount of federal, state and local income taxes on such reduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced Total Payments) is greater than or equal to (ii) the net amount of such Total Payments without such reduction (after subtracting the net amount of federal, state and local income taxes on such Total Payments and the amount of Excise Tax to which Executive would be subject in respect of such unreduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced Total Payments). Except to the extent that an alternative reduction order would result in a greater economic benefit to the Executive on an after-tax basis, the parties intend that the Total Payments shall be reduced in the following order: (w) reduction of any cash severance payments otherwise payable to Executive that are exempt from Section 409A of the Code, (x) reduction of any other cash payments or benefits otherwise payable to Executive that are exempt from Section 409A of the Code, but excluding any payment attributable to the acceleration of vesting or payment with respect to any equity award that is exempt from Section 409A of the Code, (y) reduction of any other payments or benefits otherwise payable to Executive on a pro-rata basis or such other manner that complies with Section 409A of the Code, but excluding any payment attributable to the acceleration of vesting and payment with respect to any equity award that is exempt from Section 409A of the Code, and (z) reduction of any payments attributable to the acceleration of vesting or payment with respect to any equity award that is exempt from Section 409A of the Code; provided, in case of clauses (x), (y) and (z), that reduction of any payments or benefits attributable to the acceleration of vesting of Company equity awards shall be first applied to equity awards with later vesting dates; provided, further, that, notwithstanding the foregoing, any such reduction shall be undertaken in a manner that complies with and does not result in the imposition of additional taxes on the Executive under Section 409A of the Code. The foregoing reductions shall be made in a manner that results in the maximum economic benefit to Executive on an after-tax basis and, to the extent economically equivalent payments or benefits are subject to reduction, in a pro rata manner.
(b) Determinations. All determinations regarding the application of this Section 9 shall be made by an independent accounting firm or consulting group with nationally recognized standing and substantial expertise and experience in performing calculations regarding the applicability of Section 280G of the Code and the Excise Tax retained by the Company prior to the date of the applicable change in ownership or control (the “280G Firm”). For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax, (i) no portion of the Total Payments shall be taken into account which (x) does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, or (y) constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation, (ii) no portion of the Total Payments the receipt or enjoyment of which Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be taken into account, and (iii) the value of any non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by the 280G Firm in accordance with the principles of Sections 280G(d)(3) and (iv) of the Code. All determinations related to the calculations to be performed pursuant to this “Section 280G Treatment” section shall be done by the 280G Firm. The 280G Firm will be directed to submit its determination and detailed supporting calculations to both Executive and the Company within fifteen (15) days after notification from either the Company or Executive that Executive may receive payments which may be
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“parachute payments.” Executive and the Company will each provide the 280G Firm access to and copies of any books, records, and documents as may be reasonably requested by the 280G Firm, and otherwise cooperate with the 280G Firm in connection with the preparation and issuance of the determinations and calculations contemplated by this Agreement. The fees and expenses of the 280G Firm for its services in connection with the determinations and calculations contemplated by this Agreement will be borne solely by the Company.
10. Certain Definitions.
(a) “Board” means the Board of Directors of the Company.
(b) “Cause” means the occurrence of any one or more of the following events:
(i) the Executive’s willful failure to substantially perform his or her duties with the Company (other than any such failure resulting from the Executive’s incapacity due to physical or mental illness or any such actual or anticipated failure after his or her issuance of a Notice of Termination for Good Reason), including the Executive’s failure to follow any lawful directive from the CEO within the reasonable scope of the Executive’s duties and the Executive’s failure to correct the same (if capable of correction, as determined by the CEO), within thirty (30) days after a written notice is delivered to the Executive, which demand specifically identifies the manner in which the CEO believes that the Executive has not performed his or her duties;
(ii) the Executive’s conviction of, indictment for or entry of a plea of guilty or nolo contendere to a felony crime (excluding vehicular crimes) or a crime of moral turpitude;
(iii) the Executive’s material breach of any material obligation under any written agreement with the Company or its affiliates or under any applicable policy of the Company or its affiliates (including any code of conduct or harassment policies), and the Executive’s failure to correct the same (if capable of correction, as determined by the CEO), within thirty (30) days after a written notice is delivered to the Executive, which demand specifically identifies the manner in which the CEO believes that the Executive has materially breached such agreement or policy;
(iv) any act of fraud, embezzlement, theft or misappropriation from the Company or its affiliates by the Executive;
(v) the Executive’s willful misconduct or gross negligence with respect to any material aspect of the Company’s business or a material breach by the Executive of his or her fiduciary duty to the Company or its affiliates, which willful misconduct, gross negligence or material breach has a material and demonstrable adverse effect on the Company or its affiliates; or
(vi) the Executive’s commission of an act of material dishonesty resulting in material reputational, economic or financial injury to the Company or its affiliates.
(a) “Change in Control” has the meaning set forth in the Plan. Notwithstanding the foregoing, in no event shall Parent’s initial public offering constitute a Change in Control and, if a Change in Control constitutes a payment event with respect to any amount hereunder that provides for the deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event shall only constitute a Change in Control for purposes of the payment timing of such amount if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5).
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(b) “Code” means the Internal Revenue Code of 1986, as amended, and the regulations thereunder.
(c) “Date of Termination” means the date on which the Executive’s employment with the Company terminates.
(d) “Disability” means that the Executive has become entitled to receive benefits under an applicable Company long-term disability plan or, if no such plan covers the Executive, as determined in the reasonable discretion of the Board.
(e) “Good Reason” means the occurrence of any one or more of the following events without the Executive’s prior written consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) as provided below:
(i) a material diminution in the Executive’s base compensation, unless such a reduction is imposed as part of a generalized reduction in the base salaries of senior management of the Company;
(ii) a material diminution in the Executive’s title, authority or duties, as contemplated by this Agreement; or
(iii) the Company’s material breach of this Agreement.
Notwithstanding the foregoing, the Executive will not be deemed to have resigned for Good Reason unless (1) the Executive provides the Company with written notice setting forth in reasonable detail the facts and circumstances claimed by the Executive to constitute Good Reason within thirty (30) days after the date of the occurrence of any event that the Executive knows or should reasonably have known to constitute Good Reason, (2) the Company fails to cure such acts or omissions within thirty (30) days following its receipt of such notice, and (3) the effective date of the Executive’s termination for Good Reason occurs no later than sixty (60) days after the expiration of the Company’s cure period.
(f) “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice unless as otherwise provided upon a termination for Good Reason).
(g) “Plan” means Parent’s 2021 Incentive Award Plan, as amended from time to time.
(h) “Qualifying Termination” means a termination of the Executive’s employment (i) by the Company without Cause (other than by reason of the Executive’s death or Disability), or (ii) by the Executive for Good Reason.
(i) “Section 409A” means Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.
(j) “Separation from Service” means a “separation from service” (within the meaning of Section 409A).
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11. Miscellaneous.
(a) Governing Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without reference to principles of conflict of laws. Any suit brought hereon shall be brought in the state or federal courts sitting in Salt Lake City, Utah, the parties hereby waiving any claim or defense that such forum is not convenient or proper. Each party hereby agrees that any such court shall have in personam jurisdiction over it and consents to service of process in any manner authorized by Utah law.
(b) Notices. Any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows with notice deemed given as indicated: (i) by personal delivery when delivered personally; (ii) by overnight courier upon written verification of receipt; (iii) by email upon acknowledgment of receipt of electronic transmission; or (iv) by certified or registered mail, return receipt requested, upon verification of receipt. Notice shall be sent to Executive at the address listed on the Company’s personnel records and to the Company at its principal place of business to the attention of the Company’s General Counsel, or such other address as either party may specify in writing.
(c) Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”), then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder.
(d) Section 409A of the Code.
(i) To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be subject to Section 409A, the Company shall work in good faith with the Executive to adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 11(d) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
(ii) Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
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(iii) To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
(e) Severability. In the event any provision of this Agreement is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.
(f) Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
(g) No Waiver. The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c) hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
(h) Entire Agreement. As of the Effective Date, this Agreement and the Restrictive Covenant Agreement constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, by any member of the Company and its subsidiaries or affiliates, or representative thereof. Notwithstanding anything herein to the contrary, this Agreement and the obligations and commitments hereunder shall neither commence nor be of any force or effect prior to the Effective Date.
(i) Arbitration. To aid in the rapid and economical resolution of any disputes that may arise in the course of the employment relationship, Executive and the Company agree that any and all disputes, claims, or demands in any way arising out of or relating to the terms of this Agreement, Company equity held by Executive, Executive’s employment relationship with the Company, or the termination of Executive’s employment or service relationship with the Company, shall be resolved, to the fullest extent permitted by law, by final, binding and confidential arbitration in Salt Lake City, Utah, conducted before a single neutral arbitrator selected and administered in accordance with the employment arbitration rules & procedures or then applicable equivalent rules of JAMS, Inc. (the “JAMS Rules”) and the Federal Arbitration Act, 9 U.S.C. Sec. 1, et seq. A copy of the JAMS rules may be found on the JAMS website at www.jamsadr.com and will be provided to Executive by the Company upon request. BY AGREEING TO THIS ARBITRATION PROCEDURE, EXECUTIVE AND THE COMPANY WAIVE THE RIGHT TO RESOLVE ANY SUCH DISPUTE, CLAIM OR DEMAND THROUGH A TRIAL BY JURY OR JUDGE OR BY ADMINISTRATIVE PROCEEDING IN ANY JURISDICTION. Executive will have the right to be represented by legal counsel at any arbitration proceeding, at Executive’s expense. The arbitrator shall: (a) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be available under applicable law in a court proceeding and (b) issue a written statement signed by the arbitrator regarding the disposition of each claim and the relief, if any, awarded as
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to each claim, the reasons for the award, and the arbitrator’s essential findings and conclusions on which the award is based. The parties agree that the prevailing party in any arbitration shall be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitration award. This Section 11(i) is intended to be the exclusive method for resolving any and all claims by the parties against each other for payment of damages under this Agreement or relating to Executive’s employment; provided, however, that Executive shall retain the right to file administrative charges with or seek relief through any government agency of competent jurisdiction, and to participate in any government investigation, including but not limited to (i) claims for workers’ compensation, state disability insurance or unemployment insurance; (ii) claims for unpaid wages or waiting time penalties brought before any governmental agency; provided, however, that any appeal from an award or from denial of an award of wages and/or waiting time penalties shall be arbitrated pursuant to the terms of this Agreement; and (iii) claims for administrative relief from the United States Equal Employment Opportunity Commission and/or the any similar agency in any applicable jurisdiction; provided, further, that Executive shall not be entitled to obtain any monetary relief through such agencies other than workers’ compensation benefits or unemployment insurance benefits. Nothing in this Agreement is intended to prevent either Executive or the Company from obtaining injunctive relief (or any other provisional remedy) in any court of competent jurisdiction pursuant to applicable law to prevent irreparable harm (including, without limitation, pending the conclusion of any arbitration). The Company shall pay the arbitrator’s fees, arbitration expenses and any other costs unique to the arbitration proceeding (recognizing that each side shall bear its own deposition, witness, expert and attorney’s fees and other expenses to the same extent as if the matter were being heard in court); provided, however, that the arbitrator may award attorney’s fees and costs to the prevailing party, except as prohibited by law.
THE EXECUTIVE AND THE COMPANY WAIVE ANY CONSTITUTIONAL OR OTHER RIGHT TO BRING CLAIMS COVERED BY THIS AGREEMENT OTHER THAN IN THEIR INDIVIDUAL CAPACITIES. EXCEPT AS MAY BE PROHIBITED BY LAW, THIS WAIVER INCLUDES THE ABILITY TO ASSERT CLAIMS AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING.
(j) Amendment; Survival; Construction. No amendment or other modification of this Agreement shall be effective unless made in writing and signed by the parties hereto. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.
(k) Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement. This Agreement may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.
| BRIDGE INVESTMENT GROUP HOLDINGS INC. | ||||
| By: |
/s/ Jonathan Slager |
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| Name: | Jonathan Slager | |||
| Title: | Chief Executive Officer | |||
| BRIDGE INVESTMENT GROUP HOLDINGS LLC | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Authorized Signatory | |||
| BRIDGE INVESTMENT GROUP EMPLOYEE OPERATIONS LLC | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Authorized Signatory | |||
| “EXECUTIVE” |
|
/s/ Adam O’Farrell |
|
Adam O’Farrell |
[Signature Page to Employment Agreement]
EXHIBIT A
GENERAL RELEASE
1. Release For valuable consideration, the receipt and adequacy of which are hereby acknowledged, the undersigned does hereby release and forever discharge the “Releasees” hereunder, consisting of Bridge Investment Group Holdings Inc., a Delaware corporation (“Parent”), Bridge Investment Group Holdings LLC, a Delaware limited liability company (“Partnership”), Bridge Investment Group Employee Operations LLC, a Delaware limited liability company (“Operations”, and together with Parent, the Partnership, or any of the affiliates of Parent, the Partnership, and/or Operations as Executive may provide services to from time to time, and any successor(s) thereto, the “Company”), and the Company’s partners, subsidiaries, associates, affiliates, successors, heirs, assigns, agents, directors, officers, employees, representatives, lawyers, insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, losses, costs, attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called “Claims”), which the undersigned now has or may hereafter have against the Releasees, or any of them, by reason of any matter, cause, or thing whatsoever from the beginning of time to the date hereof. The Claims released herein include, without limiting the generality of the foregoing, any Claims in any way arising out of, based upon, or related to the employment or termination of employment of the undersigned by the Releasees, or any of them; any alleged breach of any express or implied contract of employment; any alleged torts or other alleged legal restrictions on Releasees’ right to terminate the employment of the undersigned; and any alleged violation of any federal, state or local statute or ordinance including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act, the Americans With Disabilities Act.
2. Claims Not Released. Notwithstanding the foregoing, this general release (the “Release”) shall not operate to release any rights or claims of the undersigned (i) to payments or benefits under Section 4(b)-(d) of that certain Employment Agreement, dated as of July 6, 2021, between the Company and the undersigned (the “Employment Agreement”), with respect to the payments and benefits provided in exchange for this Release, (ii) to payments or benefits under any equity award agreement between the undersigned and the Company, (iii) with respect to Section 2(b)(vi) of the Employment Agreement, (iv) to accrued or vested benefits the undersigned may have, if any, as of the date hereof under any applicable plan, policy, practice, program, contract or agreement with the Company, (v) to any Claims, including Claims for indemnification and/or advancement of expenses arising under any indemnification agreement between the undersigned and the Company or under the bylaws, certificate of incorporation or other similar governing document of the Company, (vi) to any Claims which cannot be waived by an employee under applicable law or (vii) with respect to the undersigned’s right to communicate directly with, cooperate with, or provide information to, any federal, state or local government regulator.
3. Unknown Claims. THE UNDERSIGNED ACKNOWLEDGES THAT THE UNDERSIGNED HAS BEEN ADVISED BY LEGAL COUNSEL AND IS FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
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THE UNDERSIGNED, BEING AWARE OF SAID CODE SECTION, HEREBY EXPRESSLY WAIVES ANY RIGHTS THE UNDERSIGNED MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.
4. Exceptions. Notwithstanding anything in this Release to the contrary, nothing contained in this Release shall prohibit the undersigned from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with any governmental agency or entity or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation and/or (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to, any federal, state or local government regulator (including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice) for the purpose of reporting or investigating a suspected violation of law, or from providing such information to the undersigned’s attorney or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding. Pursuant to 18 USC Section 1833(b), the undersigned will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
5. Representations; Continuing Obligations. The undersigned represents and warrants that there has been no assignment or other transfer of any interest in any Claim which the undersigned may have against Releasees, or any of them, and the undersigned agrees to indemnify and hold Releasees, and each of them, harmless from any liability, Claims, demands, damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of them, as the result of any such assignment or transfer or any rights or Claims under any such assignment or transfer. It is the intention of the parties that this indemnity does not require payment as a condition precedent to recovery by the Releasees against the undersigned under this indemnity. The undersigned hereby expressly reaffirms his obligations under Section 6 of the Employment Agreement, and agrees that such obligations shall survive the termination of the undersigned’s employment.
6. No Action. The undersigned agrees that if the undersigned hereafter commences any suit arising out of, based upon, or relating to any of the Claims released hereunder or in any manner asserts against Releasees, or any of them, any of the Claims released hereunder, then the undersigned agrees to pay to Releasees, and each of them, in addition to any other damages caused to Releasees thereby, all attorneys’ fees incurred by Releasees in defending or otherwise responding to said suit or Claim.
7. No Admission. The undersigned further understands and agrees that neither the payment of any sum of money nor the execution of this Release shall constitute or be construed as an admission of any liability whatsoever by the Releasees, or any of them, who have consistently taken the position that they have no liability whatsoever to the undersigned.
8. OWBPA. The undersigned agrees and acknowledges that this Release constitutes a knowing and voluntary waiver and release of all Claims the undersigned has or may have against the Company and/or any of the Releasees as set forth herein, including, but not limited to, all Claims arising under the Older Workers Benefit Protection Act and the Age Discrimination in Employment Act. In accordance with the Older Workers Benefit Protection Act, the undersigned is hereby advised as follows:
(a) the undersigned has read the terms of this Release, and understands its terms and effects, including the fact that the undersigned agreed to release and forever discharge the Company and each of the Releasees, from any Claims released in this Release;
(b) the undersigned understands that, by entering into this Release, the undersigned
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does not waive any Claims that may arise after the date of the undersigned’s execution of this Release, including without limitation any rights or claims that the undersigned may have to secure enforcement of the terms and conditions of this Release;
(c) the undersigned has signed this Release voluntarily and knowingly in exchange for the consideration described in this Release, which the undersigned acknowledges is adequate and satisfactory to the undersigned and which the undersigned acknowledges is in addition to any other benefits to which the undersigned is otherwise entitled;
(d) the Company advises the undersigned to consult with an attorney prior to executing this Release;
(e) the undersigned has been given at least 21 days in which to review and consider this Release. To the extent that the undersigned chooses to sign this Release prior to the expiration of such period, the undersigned acknowledges that the undersigned has done so voluntarily, had sufficient time to consider the Release, to consult with counsel and that the undersigned does not desire additional time and hereby waives the remainder of the 21-day period; and
(f) the undersigned may revoke this Release within seven (7) days from the date the undersigned signs this Release and this Release will become effective upon the expiration of that revocation period if the undersigned has not revoked this Release during such seven-day period. If the undersigned revokes this Release during such seven-day period, this Release will be null and void and of no force or effect on either the Company or the undersigned and the undersigned will not be entitled to any of the payments or benefits which are expressly conditioned upon the execution and non-revocation of this Release. Any revocation must be in writing and sent to [name], via electronic mail at [email address], on or before 5:00 p.m. Pacific time on the seventh day after this Release is executed by the undersigned.]
9. Governing Law and Venue. This Release is deemed made and entered into in the State of Utah and in all respects shall be interpreted, enforced and governed under the internal laws of the State of Utah, to the extent not preempted by federal law. Any suit brought hereon shall be brought in the state or federal courts sitting in Salt Lake City, Utah, the parties hereby waiving any claim or defense that such forum is not convenient or proper. Each party hereby agrees that any such court shall have in personam jurisdiction over it and consents to service of process in any manner authorized by Utah law.
10. Severability. In the event any provision of this Release is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.
11. Counterparts. This Release may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement. This Release may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
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IN WITNESS WHEREOF, the undersigned has executed this Release this day of , .
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|
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| Adam O’Farrell |
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EXHIBIT B
PARTNER ALUMNA/ALUMNUS AND PARTNER EMERITA/EMERITUS TERMS AND CONDITIONS
PARTNER ALUMNA/ALUMNUS:
Eligibility: To be eligible to be named as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive must:
(a) Have been a Partner in the Partnership for at least five years prior to the termination of the Employment Period,
(b) Unless otherwise determined by the Board, retain at least 60,000 shares of the Class A common stock of Parent (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable, or redeemable for, shares of Class A common stock of Parent (including interests of the Partnership));
(c) Timely sign and not revoke the Release; and
(d) Remain in compliance with the Agreement and the Restrictive Covenant Agreements and must not be employed by or consult with a competitor as determined solely by the Board.
Obligations: In order to continue to retain his or her status as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive must:
(a) Be available as a mentor for at least one high potential future leader;
(b) Be available for advice and counsel to the Company from time to time;
(c) As requested by the Board, be willing to serve on at least one Company committee (e.g., ESG, DE&I, etc.);
(d) Be willing to promote the Company and its investment vehicles as appropriate.
Benefits: During Executive’s period of service as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive shall be eligible to:
(a) Receive Company-arranged financing, to the extent generally available to employees of the Company, for acquiring limited-partner interests in Company-sponsored funds on terms generally available to employees;
(b) Receive a waiver of management fees or carried interest for any limited-partner investments in any Company-sponsored fund (up to a maximum of $5.0 million committed capital per fund);
(c) Be invited to attend summer and holiday Company parties; and
(d) Be invited to, and expected to attend, an annual reunion dinner hosted by the Chairman.
B-1
PARTNER EMERITA/EMERITUS:
Eligibility: To be eligible to be named as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive must:
(a) Have been a Partner in the Partnership for at least ten years prior to the termination of the Employment Period,
(b) Unless otherwise determined by the Board, retain at least 300,000 shares of the Class A common stock of Parent (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable, or redeemable for, shares of Class A common stock of Parent (including interests of the Partnership));
(c) Timely sign and not revoke the Release; and
(d) Remain in compliance with the Agreement and the Restrictive Covenant Agreements and must not be employed by or consult with a competitor as determined solely by the Board.
Obligations: In order to continue to retain his or her status as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive must:
(a) Be available as a mentor for up to two (simultaneous) high potential future leaders;
(b) Be available for advice and counsel to the Company from time to time;
(c) As requested by the Board, be willing to serve on at least one Company committee (e.g., ESG, DE&I, etc.);
(d) Be willing to promote the Company and its investment vehicles as appropriate.
Benefits: During Executive’s period of service as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive shall be eligible to:
(a) Receive Company-arranged financing, to the extent generally available to employees of the Company, for acquiring limited partner interests in Company-sponsored funds on terms generally available to employees;
(b) Receive a waiver of management fees or carried interest for any limited-partner investments in any Company-sponsored fund;
(c) Be invited to attend summer and holiday Company parties; and
(d) Be invited to, and expected to attend, an annual reunion dinner hosted by the Chairman.
B-2
Exhibit 10.11
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into by and among Bridge Investment Group Holdings Inc., a Delaware corporation (“Parent”), Bridge Investment Group Holdings LLC, a Delaware limited liability company (“Partnership”), Bridge Investment Group Employee Operations LLC, a Delaware limited liability company (“Operations”, and together with Parent, the Partnership, or any of the affiliates of Parent, the Partnership, and/or Operations as Executive may provide services to from time to time, and any successor(s) thereto, the “Company”) and Dean Allara (the “Executive”), and shall be effective as of the date on which Parent’s Registration Statement on Form S-1 filed in connection with Parent’s initial public offering becomes effective (the “Effective Date”).
WHEREAS, the Company desires to continue to employ the Executive and the Company and the Executive desire to enter into an agreement embodying the terms of such continued employment, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Effective upon the Effective Date, the Executive’s employment hereunder shall be for a term (the “Employment Period”) commencing on the Effective Date and continuing indefinitely until terminated in accordance with the terms of this Agreement. Notwithstanding anything to the contrary in the foregoing, the Executive’s employment hereunder is terminable at will by the Company or by the Executive at any time (for any reason or for no reason), subject to the provisions of Section 4 hereof.
2. Terms of Employment.
(a) Position and Duties.
(i) Role and Responsibilities. Executive shall continue to serve as the Vice Chairman and Head of Client Solutions Group of the Company and a Partner in the Partnership, and shall perform such employment duties as are usual and customary for such positions. In addition, Executive currently serves as a member of the Board of Directors of the Company (the “Board”). The Executive shall report directly to the Chairman of the Board (the “Chairman”). At the Company’s request, the Executive shall serve the Company and/or its subsidiaries and affiliates in other capacities in addition to the foregoing, consistent with the Executive’s position hereunder. In the event that the Executive, during the Employment Period, serves in any one or more of such additional capacities, the Executive’s compensation shall not be increased beyond that specified in Section 2(b) hereof, unless otherwise determined by the Board. In addition, in the event the Executive’s service in one or more of such additional capacities is terminated, the Executive’s compensation, as specified in Section 2(b) hereof, shall not be diminished or reduced in any manner as a result of such termination provided that the Executive otherwise remains employed under the terms of this Agreement, unless otherwise determined by the Board.
(ii) Exclusivity. During the Employment Period, and excluding any periods of leave to which the Executive may be entitled, the Executive agrees to devote his or her full business time and attention to the business and affairs of the Company. Notwithstanding the foregoing, during the Employment Period, it shall not be a violation of this Agreement for the Executive to: (A) serve on boards, committees or similar bodies of charitable or nonprofit organizations, (B) fulfill limited teaching, speaking and writing engagements, and (C) manage his or her personal investments, in each case, so long as such activities do not individually or in the aggregate materially interfere or conflict with the performance of the Executive’s duties and responsibilities under this Agreement; provided, that with respect to the activities in subclause (A), the Executive receives prior written approval from the Chairman.
(b) Compensation, Benefits, Etc.
(i) Base Salary. Effective as of the Effective Date and during the Employment Period, the Executive shall receive a base salary (the “Base Salary”) of $500,000 per annum. The Base Salary shall be paid in accordance with the Company’s normal payroll practices for executive salaries generally, but no less often than monthly and shall be pro-rated for partial years of employment. The Base Salary may be increased in the discretion of the Board or a subcommittee thereof, but not reduced, and the term “Base Salary” as utilized in this Agreement shall refer to the Base Salary as so increased.
(ii) Cash Bonus. For each calendar year ending during the Employment Period, the Executive shall be eligible to earn a cash performance bonus (a “Bonus”) under the Company’s bonus plan or program applicable to senior executives targeted at 145.475% of the Executive’s Base Salary. The actual amount of any Bonus shall be determined by the Board (or a subcommittee thereof) in its discretion, based on the achievement of individual and/or Company performance goals as determined by the Board (or a subcommittee thereof). The payment of any Bonus, to the extent any Bonus becomes payable, will be made on the date(s) on which semi-annual or annual bonuses are paid generally to the Company’s senior executives, subject to the Executive’s continued employment through the payment date.
(iii) IPO Equity Award. Upon the closing of Parent’s initial public offering, Parent shall issue to the Executive an award of 135,503 shares of restricted Class A common stock under Parent’s 2021 Incentive Award Plan. Except as otherwise provided herein, subject to Executive’s continued employment with the Company through each such date, the restricted stock award shall vest in three equal installments on each of the third, fourth and fifth anniversaries of the closing date of Parent’s initial public offering. The terms and conditions of the restricted stock award shall be set forth in an award agreement in a form prescribed by the Board to be entered into by the Company and Executive.
(iv) Carried Interest Awards. Executive shall be entitled to participate in such portion of the carried interest in the Company’s affiliated fund general partners as is determined by the Board. Except as otherwise provided herein, the terms and conditions of all carried interest awards will be set forth in the applicable partnership agreements and award letters.
(v) Benefits. During the Employment Period, the Executive (and the Executive’s spouse and/or eligible dependents to the extent provided in the applicable plans and programs) shall be eligible to participate in and be covered under the health and welfare benefit plans and programs maintained by the Company for the benefit of its employees from time to time, pursuant to the terms of such plans and programs including any medical, life, hospitalization, dental, disability, accidental death and dismemberment and travel accident insurance plans and programs on the same terms and conditions as those applicable to similarly situated senior executives. In addition, during the Employment Period, the Executive shall be eligible to participate in any retirement, savings and other employee benefit plans and programs maintained from time to time by the Company for the benefit of its senior executive officers. Nothing contained in this Section 2(b)(v) shall create or be deemed to create any obligation on the part of the Company to adopt or maintain any health, welfare, retirement or other benefit plan or program at any time or to create any limitation on the Company’s ability to modify or terminate any such plan or program.
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(vi) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in connection with the performance of his or her duties under this Agreement in accordance with the policies, practices and procedures of the Company provided to employees of the Company.
(vii) Fringe Benefits. During the Employment Period, the Executive shall be eligible to receive such fringe benefits and perquisites as are provided by the Company to its employees from time to time, in accordance with the policies, practices and procedures of the Company, and shall receive such additional fringe benefits and perquisites as the Company may, in its discretion, from time-to-time provide.
(viii) Vacation/Paid Time Off. During the Employment Period, the Executive shall be entitled to vacation and/or paid time off in accordance with the plans, policies, programs and practices of the Company applicable to its senior executives.
3. Termination of Employment.
(a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. Either the Company or the Executive may terminate the Executive’s employment in the event of the Executive’s Disability during the Employment Period.
(b) Termination by the Company. The Company may terminate the Executive’s employment during the Employment Period for Cause or without Cause.
(c) Termination by the Executive. The Executive’s employment may be terminated by the Executive for any or no reason, including with Good Reason or by the Executive without Good Reason.
(d) Notice of Termination. Any termination of employment (other than due to the Executive’s death), shall be communicated by a Notice of Termination to the other parties hereto given in accordance with Section 11(b) hereof. The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
(e) Termination of Offices and Directorships; Return of Property. Upon termination of the Executive’s employment for any reason, unless otherwise specified in a written agreement between the Executive and the Company, the Executive shall be deemed to have resigned from all offices, directorships, and other employment positions, if any, then held with the Company, and shall take all actions reasonably requested by the Company to effectuate the foregoing. In addition, upon the termination of the Executive’s employment for any reason, the Executive agrees to return to the Company all documents of the Company and its affiliates (and all copies thereof) and all other Company or Company affiliate property that the Executive has in his or her possession, custody or control. Such property includes, without limitation: (i) any materials of any kind that the Executive knows contain or embody any proprietary or confidential information of the Company or an affiliate of the Company (and all reproductions thereof), (ii) computers (including, but not limited to, laptop computers, desktop computers and similar devices) and other portable electronic devices (including, but not limited to, tablet computers), cellular phones/smartphones, credit cards, phone cards, entry cards, identification badges and keys, and (iii) any correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the business, clients, investors, customers, business plans, marketing strategies, products and/or processes of the Company or any of its affiliates and any information received from the Company or any of its affiliates regarding third parties.
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4. Obligations of the Company upon Termination.
(a) Accrued Obligations. In the event that the Executive’s employment under this Agreement terminates during the Employment Period for any reason, the Company will pay or provide to the Executive: (i) any earned but unpaid Base Salary and accrued but unused vacation or paid time off, and (ii) reimbursement of any business expenses incurred by the Executive prior to the Date of Termination that are reimbursable in accordance with Section 2(b)(vi) hereof (together, the “Accrued Obligations”). The Accrued Obligations described in clauses (i) – (ii) of the preceding sentence shall be paid within thirty (30) days after the Date of Termination (or such earlier date as may be required by applicable law).
(b) Qualifying Termination. Subject to Sections 4(e), 4(f), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof (including the Restrictive Covenants Agreement), if the Executive’s employment with the Company is terminated during the Employment Period due to a Qualifying Termination, then in addition to the Accrued Obligations:
(i) Cash Severance. The Company shall continue to pay Executive his or her Base Salary at the then-current rate per pay period for a period of twelve (12) months (the “Severance Period”) following the termination of the Employment Period, in accordance with the Company’s then-current payroll policies and practices. The foregoing severance payments shall commence on the first payroll period following the date Executive’s Release becomes effective (the “Payment Date”) and the first payment shall include all accrued amounts from the Date of Termination; provided, however, if upon Executive’s Qualifying Termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement (as such term is defined therein), then, in each pay period, any Base Salary to be provided pursuant to this Section 4(b)(i) shall be reduced by the amount of such Garden Leave Compensation also paid in such pay period.
(ii) COBRA. Unless Section 4(b)(v)(C) applies, in which case this section shall not apply, subject to the Executive’s valid election to continue healthcare coverage under Section 4980B of the Code, for the Severance Period, the Company shall continue to provide, during the Severance Period, the Executive and the Executive’s eligible dependents with coverage under its group health plans at the same levels and the same cost to the Executive as would have applied if the Executive’s employment had not been terminated based on the Executive’s elections in effect on the Date of Termination, provided, however, that (A) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the continuation coverage period (or the remaining portion thereof). If upon Executive’s Qualifying Termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement (as such term is defined therein), the healthcare coverage under this Section 4(b)(ii) shall not apply for any period during which reimbursement of COBRA premiums is provided to Executive as part of such Garden Leave Compensation in such period.
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(iii) Equity Acceleration. All outstanding Company equity awards that are held by the Executive on the Date of Termination (other than any carried interest awards) shall vest and, to the extent applicable, become exercisable on an accelerated basis as of the Date of Termination with respect to the number of shares underlying such award that would have vested (and become exercisable, if applicable) had the Executive remained in continuous service beyond the Date of Termination for the Severance Period. Notwithstanding the foregoing, in the event that the Qualifying Termination occurs on or within eighteen (18) months following a Change in Control, then all outstanding Company equity awards that are held by the Executive on the Date of Termination (other than any carried interest awards) shall become fully vested and, to the extent applicable, exercisable. Any remaining unvested Company equity awards after giving effect to the foregoing acceleration (other than any carried interest awards) shall be immediately forfeited for no consideration upon such termination. The foregoing provisions are hereby deemed to be a part of each equity award (and, for the avoidance of doubt, if any equity award is subject to more favorable vesting pursuant to any agreement or plan regarding such equity award, such more favorable provisions shall continue to apply and shall not be limited by this clause (iii)).
(v) Partner Alumna/Alumnus and Partner Emerita/Emeritus Status. Subject to Executive’s satisfaction of the requirements set forth in Exhibit B, Executive shall be eligible for:
(A) To the extent Executive satisfies the requirements for “Partner Alumna/Partner Alumnus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(B) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(C) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, for so long as Executive retains such “Partner Emerita/Emeritus” status (the “Partner Emerita/Emeritus Coverage Period”), the Company shall continue to provide, during the Partner Emeritus Coverage Period, the Executive and the Executive’s eligible dependents with coverage under its group health plans at the same levels and the same cost to the Executive as would have applied if the Executive’s employment had not been terminated based on the Executive’s elections in effect on the Date of Termination, which continuation coverage shall be provided, to the extent possible, under COBRA, provided, however, that (1) if any plan pursuant to which such benefits are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), or (2) the Company is otherwise unable to continue to cover the Executive under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act or the Patient Protection and Affordable Care Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to the Executive in substantially equal monthly installments over the Partner Emerita/Emeritus Coverage Period (or the remaining portion thereof). If upon Executive’s termination he or she is eligible for Garden Leave Compensation under the Restrictive Covenants Agreement, the healthcare coverage under this Section 4(b)(v)(C) shall not apply for any period during which reimbursement of COBRA premiums is provided to Executive as part of such Garden Leave Compensation in such period.
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(D) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, and except to the extent a carried interest award agreement governing a carried interest award granted to Executive specifically provides for the treatment of such carried interest award in the event of Executive’s Qualifying Termination and provides that its terms shall supersede the provisions of this Section 4(b)(v), in which case the terms of such award agreement shall govern, seventy-five percent (75%) of the outstanding unvested carried interest awards held by Executive shall become fully vested upon the date of such termination. The foregoing provisions are hereby deemed to be a part of each carried interest award (and, for the avoidance of doubt, if any carried interest award is subject to more favorable vesting pursuant to any agreement or plan regarding such carried interest award, such more favorable provisions shall continue to apply and shall not be limited by this clause (v)(D)).
(c) Resignation Other than for Good Reason. Subject to Sections 4(c), 4(e), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof, if the Executive’s employment with the Company is terminated during the Employment Period due to Executive’s voluntary resignation other than for Good Reason, then in addition to the Accrued Obligations, subject to Executive’s satisfaction of the requirements set forth in Exhibit B, Executive shall be eligible for:
(i) To the extent Executive satisfies the requirements for “Partner Alumna/Partner Alumnus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(ii) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits provided in Exhibit B related to such status.
(iii) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, the benefits specified under Section 4(b)(v)(C) above.
(iv) To the extent Executive satisfies the requirements for “Partner Emerita/Emeritus” status as of the date of the termination of the Employment Period, and except to the extent a carried interest award agreement governing a carried interest award granted to Executive specifically provides for the treatment of such carried interest award in the event of Executive’s Qualifying Termination and provides that its terms shall supersede the provisions of this Section 4(c)(iv), in which case the terms of such award agreement shall govern, seventy-five percent (75%) of the outstanding unvested carried interest awards held by Executive shall become fully vested upon the date of such termination.
(d) Death or Disability. Subject to Sections 4(c), 4(e), 9 and 11(d), and the Executive’s continued compliance with the provisions of Section 6 hereof, if the Executive’s employment with the Company is terminated during the Employment Period as a result of Executive’s death or Disability, then in addition to the Accrued Obligations:
(i) Equity Acceleration. All outstanding Company equity awards that are subject to time-based vesting conditions that are held by the Executive on the Date of Termination shall vest and, to the extent applicable, become exercisable on an accelerated basis as of the Date of Termination.
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(ii) Carried Interest Acceleration. All outstanding carried interest awards shall vest as of the Date of Termination.
(e) Release. Notwithstanding the foregoing, it shall be a condition to the Executive’s right to receive the amounts provided for in Sections 4(b), 4(c) or 4(d) hereof that the Executive execute and deliver to the Company an effective release of claims in substantially the form attached hereto as Exhibit A (the “Release”) within twenty-one (21) days (or, to the extent required by law, forty-five (45) days) following the Date of Termination and that the Executive not revoke such Release during any applicable revocation period. For the avoidance of doubt, all equity awards and/or carried interest awards eligible for accelerated vesting pursuant to Sections 4(b), 4(c) or 4(d) hereof shall remain outstanding and eligible to vest following the Date of Termination and shall actually vest and become exercisable (if applicable) and non-forfeitable upon the effectiveness of the Release.
(f) Other Terminations. If the Executive’s employment is terminated for any reason not described in Sections 4(b), 4(c) or 4(d) hereof, the Company will pay the Executive only the Accrued Obligations.
(g) Six-Month Delay. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits, including without limitation any severance payments or benefits payable under this Section 4, shall be paid to the Executive during the six-month period following the Executive’s Separation from Service if the Company determines that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first day of the seventh month following the date of Separation from Service (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of the Executive’s death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period.
(h) Exclusive Benefits. Except as expressly provided in this Section 4 and subject to Section 5 hereof, the Executive shall not be entitled to any additional payments or benefits upon or in connection with the Executive’s termination of employment.
5. Non-Exclusivity of Rights. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
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6. Restrictive Covenants.
(a) The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company and its subsidiaries and affiliates, which shall have been obtained by the Executive in connection with the Executive’s employment by the Company and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company, the Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data, to anyone other than the Company and those designated by it; provided, however, that if the Executive receives actual notice that the Executive is or may be required by law or legal process to communicate or divulge any such information, knowledge or data, the Executive shall promptly so notify the Company.
(b) While employed by the Company, the Executive shall not be engaged in any other business activity that would be competitive with the business of the Company and its subsidiaries or affiliates. In addition, while employed by the Company and for a period of twelve (12) months after the Date of Termination, the Executive shall not directly or indirectly solicit, induce, or encourage any employee or consultant of the Company and/or its subsidiaries and affiliates to terminate their employment or other relationship with the Company and its subsidiaries and affiliates or to cease to render services to the Company and/or its subsidiaries and affiliates and the Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity except, in each case, to the extent the foregoing occurs as a result of general advertisements or other solicitations not specifically targeted to such employees and consultants. During his or her employment with the Company and for a period of twelve (12) months after the Date of Termination, the Executive shall not use any trade secret of the Company or its subsidiaries or affiliates to solicit, induce, or encourage any customer, client, vendor, or other party doing business with any member of the Company and its subsidiaries and affiliates to terminate its relationship therewith or transfer its business from any member of the Company and its subsidiaries and affiliates and the Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity.
(c) Subject to Section 6(f), during the Executive’s service with the Company and thereafter, excepting any litigation between the parties, (i) the Executive agrees not to publish or disseminate, directly or indirectly, any statements, whether written or oral, that are or could be harmful to or reflect negatively on any of the Company or any of its subsidiaries or affiliates, or that are otherwise disparaging of any policies, procedures, practices, decision-making, conduct, professionalism or compliance with standards of the Company, its affiliates or any of their past or present officers, directors, employees, advisors or agents, and (ii) the Company agrees to instruct its directors and executive officers not to publish or disseminate, directly or indirectly, any statements, whether written or oral, that are or could be harmful to or reflect negatively on the Executive’s personal or business reputation or business.
(d) In recognition of the fact that irreparable injury will result to the Company in the event of a breach by the Executive of his or her obligations under Sections 6(a)-(c) hereof, that monetary damages for such breach would not be readily calculable, and that the Company would not have an adequate remedy at law therefor, the Executive acknowledges, consents and agrees that in the event of such breach, or the threat thereof, the Company shall be entitled, in addition to any other legal remedies and damages available, to specific performance thereof and to temporary and permanent injunctive relief (without the necessity of posting a bond) to restrain the violation or threatened violation of such obligations by the Executive and to cease the payment of any benefits under Section 4(b)-(c) above.
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(e) The Executive hereby acknowledges that the Executive has previously entered into the Company’s standard form of Non-Competition, Non-Solicitation and Non-Disclosure Agreement, containing confidentiality, intellectual property assignment and other protective covenants (the “Restrictive Covenant Agreement”), that the Executive shall continue to be bound by the terms and conditions of the Restrictive Covenant Agreement, and that such agreement shall be additional to, and not in limitation of, the covenants contained in this Section 6.
(f) Notwithstanding anything in this Agreement or the Restrictive Covenant Agreement to the contrary, nothing contained in this Agreement shall prohibit either party (or either party’s attorney(s)) from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the U.S. Commodity Futures Trading Commission, the U.S. Department of Justice or any other securities regulatory agency, self-regulatory authority or federal, state or local regulatory authority (collectively, “Government Agencies”), or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation, (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to any Government Agencies for the purpose of reporting or investigating a suspected violation of law, or from providing such information to such party’s attorney(s) or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding, and/or (iii) receiving an award for information provided to any Government Agency. Pursuant to 18 USC Section 1833(b), the Executive will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Further, nothing in this Agreement is intended to or shall preclude either party from providing truthful testimony in response to a valid subpoena, court order, regulatory request or other judicial, administrative or legal process or otherwise as required by law. If the Executive is required to provide testimony, then unless otherwise directed or requested by a Government Agency or law enforcement, the Executive shall notify the Company as soon as reasonably practicable after receiving any such request of the anticipated testimony.
7. Representations. The Executive hereby represents and warrants to the Company that (a) the Executive is entering into this Agreement voluntarily and that the performance of the Executive’s obligations hereunder will not violate any agreement between the Executive and any other person, firm, organization or other entity, and (b) the Executive is not bound by the terms of any agreement with any previous employer or other party to refrain from competing, directly or indirectly, with the business of such previous employer or other party that would be violated by the Executive’s entering into this Agreement and/or providing services to the Company pursuant to the terms of this Agreement.
8. Successors.
(a) This Agreement is personal to the Executive and, without the prior written consent of the Company, shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon the Company and their respective successors and assigns.
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9. Section 280G of the Code.
(a) Best Pay Provision. In the event that any payment or benefit received or to be received by Executive pursuant to the terms of any plan, arrangement or agreement (including any payment or benefit received in connection with a change in ownership or control or the termination of Executive’s employment) (all such payments and benefits being hereinafter referred to as the “Total Payments”) would be subject (in whole or part) to the excise tax (the “Excise Tax”) imposed under Section 4999 of the Code, then the Total Payments shall be reduced to the extent necessary so that no portion of the Total Payments is subject to the Excise Tax but only if (i) the net amount of such Total Payments, as so reduced (after subtracting the amount of federal, state and local income taxes on such reduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced Total Payments) is greater than or equal to (ii) the net amount of such Total Payments without such reduction (after subtracting the net amount of federal, state and local income taxes on such Total Payments and the amount of Excise Tax to which Executive would be subject in respect of such unreduced Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced Total Payments). Except to the extent that an alternative reduction order would result in a greater economic benefit to the Executive on an after-tax basis, the parties intend that the Total Payments shall be reduced in the following order: (w) reduction of any cash severance payments otherwise payable to Executive that are exempt from Section 409A of the Code, (x) reduction of any other cash payments or benefits otherwise payable to Executive that are exempt from Section 409A of the Code, but excluding any payment attributable to the acceleration of vesting or payment with respect to any equity award that is exempt from Section 409A of the Code, (y) reduction of any other payments or benefits otherwise payable to Executive on a pro-rata basis or such other manner that complies with Section 409A of the Code, but excluding any payment attributable to the acceleration of vesting and payment with respect to any equity award that is exempt from Section 409A of the Code, and (z) reduction of any payments attributable to the acceleration of vesting or payment with respect to any equity award that is exempt from Section 409A of the Code; provided, in case of clauses (x), (y) and (z), that reduction of any payments or benefits attributable to the acceleration of vesting of Company equity awards shall be first applied to equity awards with later vesting dates; provided, further, that, notwithstanding the foregoing, any such reduction shall be undertaken in a manner that complies with and does not result in the imposition of additional taxes on the Executive under Section 409A of the Code. The foregoing reductions shall be made in a manner that results in the maximum economic benefit to Executive on an after-tax basis and, to the extent economically equivalent payments or benefits are subject to reduction, in a pro rata manner.
(b) Determinations. All determinations regarding the application of this Section 9 shall be made by an independent accounting firm or consulting group with nationally recognized standing and substantial expertise and experience in performing calculations regarding the applicability of Section 280G of the Code and the Excise Tax retained by the Company prior to the date of the applicable change in ownership or control (the “280G Firm”). For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax, (i) no portion of the Total Payments shall be taken into account which (x) does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, or (y) constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation, (ii) no portion of the Total Payments the receipt or enjoyment of which Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be taken into account, and (iii) the value of any non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by the 280G Firm in accordance with the principles of Sections 280G(d)(3) and (iv) of the Code. All determinations related to the calculations to be performed pursuant to this “Section 280G Treatment” section shall be done by the 280G Firm. The 280G Firm will be directed to submit its determination and detailed supporting calculations to both Executive and the Company within fifteen (15) days after notification from either the Company or Executive that Executive may receive payments which may be
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“parachute payments.” Executive and the Company will each provide the 280G Firm access to and copies of any books, records, and documents as may be reasonably requested by the 280G Firm, and otherwise cooperate with the 280G Firm in connection with the preparation and issuance of the determinations and calculations contemplated by this Agreement. The fees and expenses of the 280G Firm for its services in connection with the determinations and calculations contemplated by this Agreement will be borne solely by the Company.
10. Certain Definitions.
(a) “Board” means the Board of Directors of the Company.
(b) “Cause” means the occurrence of any one or more of the following events:
(i) the Executive’s willful failure to substantially perform his or her duties with the Company (other than any such failure resulting from the Executive’s incapacity due to physical or mental illness or any such actual or anticipated failure after his or her issuance of a Notice of Termination for Good Reason), including the Executive’s failure to follow any lawful directive from the Chairman within the reasonable scope of the Executive’s duties and the Executive’s failure to correct the same (if capable of correction, as determined by the Chairman), within thirty (30) days after a written notice is delivered to the Executive, which demand specifically identifies the manner in which the Chairman believes that the Executive has not performed his or her duties;
(ii) the Executive’s conviction of, indictment for or entry of a plea of guilty or nolo contendere to a felony crime (excluding vehicular crimes) or a crime of moral turpitude;
(iii) the Executive’s material breach of any material obligation under any written agreement with the Company or its affiliates or under any applicable policy of the Company or its affiliates (including any code of conduct or harassment policies), and the Executive’s failure to correct the same (if capable of correction, as determined by the Chairman), within thirty (30) days after a written notice is delivered to the Executive, which demand specifically identifies the manner in which the Chairman believes that the Executive has materially breached such agreement or policy;
(iv) any act of fraud, embezzlement, theft or misappropriation from the Company or its affiliates by the Executive;
(v) the Executive’s willful misconduct or gross negligence with respect to any material aspect of the Company’s business or a material breach by the Executive of his or her fiduciary duty to the Company or its affiliates, which willful misconduct, gross negligence or material breach has a material and demonstrable adverse effect on the Company or its affiliates; or
(vi) the Executive’s commission of an act of material dishonesty resulting in material reputational, economic or financial injury to the Company or its affiliates.
(a) “Change in Control” has the meaning set forth in the Plan. Notwithstanding the foregoing, in no event shall Parent’s initial public offering constitute a Change in Control and, if a Change in Control constitutes a payment event with respect to any amount hereunder that provides for the deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event shall only constitute a Change in Control for purposes of the payment timing of such amount if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5).
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(b) “Code” means the Internal Revenue Code of 1986, as amended, and the regulations thereunder.
(c) “Date of Termination” means the date on which the Executive’s employment with the Company terminates.
(d) “Disability” means that the Executive has become entitled to receive benefits under an applicable Company long-term disability plan or, if no such plan covers the Executive, as determined in the reasonable discretion of the Board.
(e) “Good Reason” means the occurrence of any one or more of the following events without the Executive’s prior written consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) as provided below:
(i) a material diminution in the Executive’s base compensation, unless such a reduction is imposed as part of a generalized reduction in the base salaries of senior management of the Company;
(ii) a material diminution in the Executive’s title, authority or duties, as contemplated by this Agreement; or
(iii) the Company’s material breach of this Agreement.
Notwithstanding the foregoing, the Executive will not be deemed to have resigned for Good Reason unless (1) the Executive provides the Company with written notice setting forth in reasonable detail the facts and circumstances claimed by the Executive to constitute Good Reason within thirty (30) days after the date of the occurrence of any event that the Executive knows or should reasonably have known to constitute Good Reason, (2) the Company fails to cure such acts or omissions within thirty (30) days following its receipt of such notice, and (3) the effective date of the Executive’s termination for Good Reason occurs no later than sixty (60) days after the expiration of the Company’s cure period.
(f) “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice unless as otherwise provided upon a termination for Good Reason).
(g) “Plan” means Parent’s 2021 Incentive Award Plan, as amended from time to time.
(h) “Qualifying Termination” means a termination of the Executive’s employment (i) by the Company without Cause (other than by reason of the Executive’s death or Disability), or (ii) by the Executive for Good Reason.
(i) “Section 409A” means Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.
(j) “Separation from Service” means a “separation from service” (within the meaning of Section 409A).
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11. Miscellaneous.
(a) Governing Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without reference to principles of conflict of laws. Any suit brought hereon shall be brought in the state or federal courts sitting in Salt Lake City, Utah, the parties hereby waiving any claim or defense that such forum is not convenient or proper. Each party hereby agrees that any such court shall have in personam jurisdiction over it and consents to service of process in any manner authorized by Utah law.
(b) Notices. Any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows with notice deemed given as indicated: (i) by personal delivery when delivered personally; (ii) by overnight courier upon written verification of receipt; (iii) by email upon acknowledgment of receipt of electronic transmission; or (iv) by certified or registered mail, return receipt requested, upon verification of receipt. Notice shall be sent to Executive at the address listed on the Company’s personnel records and to the Company at its principal place of business to the attention of the Company’s General Counsel, or such other address as either party may specify in writing.
(c) Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”), then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder.
(d) Section 409A of the Code.
(i) To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be subject to Section 409A, the Company shall work in good faith with the Executive to adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 11(d) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
(ii) Any right to a series of installment payments pursuant to this Agreement is to be treated as a right to a series of separate payments. To the extent permitted under Section 409A, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A. Any payments subject to Section 409A that are subject to execution of a waiver and release which may be executed and/or revoked in a calendar year following the calendar year in which the payment event (such as termination of employment) occurs shall commence payment only in the calendar year in which the consideration period or, if applicable, release revocation period ends, as necessary to comply with Section 409A. All payments of nonqualified deferred compensation subject to Section 409A to be made upon a termination of employment under this Agreement may only be made upon the Executive’s Separation from Service.
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(iii) To the extent that any payments or reimbursements provided to the Executive under this Agreement are deemed to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would apply, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any such payments eligible for reimbursement in one year shall not affect the payments or expenses that are eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
(e) Severability. In the event any provision of this Agreement is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.
(f) Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
(g) No Waiver. The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c) hereof, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
(h) Entire Agreement. As of the Effective Date, this Agreement and the Restrictive Covenant Agreement constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, by any member of the Company and its subsidiaries or affiliates, or representative thereof. Notwithstanding anything herein to the contrary, this Agreement and the obligations and commitments hereunder shall neither commence nor be of any force or effect prior to the Effective Date.
(i) Arbitration. To aid in the rapid and economical resolution of any disputes that may arise in the course of the employment relationship, Executive and the Company agree that any and all disputes, claims, or demands in any way arising out of or relating to the terms of this Agreement, Company equity held by Executive, Executive’s employment relationship with the Company, or the termination of Executive’s employment or service relationship with the Company, shall be resolved, to the fullest extent permitted by law, by final, binding and confidential arbitration in Salt Lake City, Utah, conducted before a single neutral arbitrator selected and administered in accordance with the employment arbitration rules & procedures or then applicable equivalent rules of JAMS, Inc. (the “JAMS Rules”) and the Federal Arbitration Act, 9 U.S.C. Sec. 1, et seq. A copy of the JAMS rules may be found on the JAMS website at www.jamsadr.com and will be provided to Executive by the Company upon request. BY AGREEING TO THIS ARBITRATION PROCEDURE, EXECUTIVE AND THE COMPANY WAIVE THE RIGHT TO RESOLVE ANY SUCH DISPUTE, CLAIM OR DEMAND THROUGH A TRIAL BY JURY OR JUDGE OR BY ADMINISTRATIVE PROCEEDING IN ANY JURISDICTION. Executive will have the right to be represented by legal counsel at any arbitration proceeding, at Executive’s expense. The arbitrator shall: (a) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be available under applicable law in a court proceeding and (b) issue a written statement signed by the arbitrator regarding the disposition of each claim and the relief, if any, awarded as
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to each claim, the reasons for the award, and the arbitrator’s essential findings and conclusions on which the award is based. The parties agree that the prevailing party in any arbitration shall be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitration award. This Section 11(i) is intended to be the exclusive method for resolving any and all claims by the parties against each other for payment of damages under this Agreement or relating to Executive’s employment; provided, however, that Executive shall retain the right to file administrative charges with or seek relief through any government agency of competent jurisdiction, and to participate in any government investigation, including but not limited to (i) claims for workers’ compensation, state disability insurance or unemployment insurance; (ii) claims for unpaid wages or waiting time penalties brought before any governmental agency; provided, however, that any appeal from an award or from denial of an award of wages and/or waiting time penalties shall be arbitrated pursuant to the terms of this Agreement; and (iii) claims for administrative relief from the United States Equal Employment Opportunity Commission and/or the any similar agency in any applicable jurisdiction; provided, further, that Executive shall not be entitled to obtain any monetary relief through such agencies other than workers’ compensation benefits or unemployment insurance benefits. Nothing in this Agreement is intended to prevent either Executive or the Company from obtaining injunctive relief (or any other provisional remedy) in any court of competent jurisdiction pursuant to applicable law to prevent irreparable harm (including, without limitation, pending the conclusion of any arbitration). The Company shall pay the arbitrator’s fees, arbitration expenses and any other costs unique to the arbitration proceeding (recognizing that each side shall bear its own deposition, witness, expert and attorney’s fees and other expenses to the same extent as if the matter were being heard in court); provided, however, that the arbitrator may award attorney’s fees and costs to the prevailing party, except as prohibited by law.
THE EXECUTIVE AND THE COMPANY WAIVE ANY CONSTITUTIONAL OR OTHER RIGHT TO BRING CLAIMS COVERED BY THIS AGREEMENT OTHER THAN IN THEIR INDIVIDUAL CAPACITIES. EXCEPT AS MAY BE PROHIBITED BY LAW, THIS WAIVER INCLUDES THE ABILITY TO ASSERT CLAIMS AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING.
(j) Amendment; Survival; Construction. No amendment or other modification of this Agreement shall be effective unless made in writing and signed by the parties hereto. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.
(k) Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement. This Agreement may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.
| BRIDGE INVESTMENT GROUP HOLDINGS INC. | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Chief Executive Officer | |||
| BRIDGE INVESTMENT GROUP HOLDINGS LLC | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Authorized Signatory | |||
| BRIDGE INVESTMENT GROUP EMPLOYEE OPERATIONS LLC | ||||
| By: |
/s/ Jonathan Slager |
|||
| Name: | Jonathan Slager | |||
| Title: | Authorized Signatory | |||
| “EXECUTIVE” | ||||
|
/s/ Dean Allara |
||||
| Dean Allara | ||||
[Signature Page to Employment Agreement]
EXHIBIT A
GENERAL RELEASE
1. Release For valuable consideration, the receipt and adequacy of which are hereby acknowledged, the undersigned does hereby release and forever discharge the “Releasees” hereunder, consisting of Bridge Investment Group Holdings Inc., a Delaware corporation (“Parent”), Bridge Investment Group Holdings LLC, a Delaware limited liability company (“Partnership”), Bridge Investment Group Employee Operations LLC, a Delaware limited liability company (“Operations”, and together with Parent, the Partnership, or any of the affiliates of Parent, the Partnership, and/or Operations as Executive may provide services to from time to time, and any successor(s) thereto, the “Company”), and the Company’s partners, subsidiaries, associates, affiliates, successors, heirs, assigns, agents, directors, officers, employees, representatives, lawyers, insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, losses, costs, attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called “Claims”), which the undersigned now has or may hereafter have against the Releasees, or any of them, by reason of any matter, cause, or thing whatsoever from the beginning of time to the date hereof. The Claims released herein include, without limiting the generality of the foregoing, any Claims in any way arising out of, based upon, or related to the employment or termination of employment of the undersigned by the Releasees, or any of them; any alleged breach of any express or implied contract of employment; any alleged torts or other alleged legal restrictions on Releasees’ right to terminate the employment of the undersigned; and any alleged violation of any federal, state or local statute or ordinance including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act, the Americans With Disabilities Act.
2. Claims Not Released. Notwithstanding the foregoing, this general release (the “Release”) shall not operate to release any rights or claims of the undersigned (i) to payments or benefits under Section 4(b)-(d) of that certain Employment Agreement, dated as of July 6, 2021, between the Company and the undersigned (the “Employment Agreement”), with respect to the payments and benefits provided in exchange for this Release, (ii) to payments or benefits under any equity award agreement between the undersigned and the Company, (iii) with respect to Section 2(b)(vi) of the Employment Agreement, (iv) to accrued or vested benefits the undersigned may have, if any, as of the date hereof under any applicable plan, policy, practice, program, contract or agreement with the Company, (v) to any Claims, including Claims for indemnification and/or advancement of expenses arising under any indemnification agreement between the undersigned and the Company or under the bylaws, certificate of incorporation or other similar governing document of the Company, (vi) to any Claims which cannot be waived by an employee under applicable law or (vii) with respect to the undersigned’s right to communicate directly with, cooperate with, or provide information to, any federal, state or local government regulator.
3. Unknown Claims. THE UNDERSIGNED ACKNOWLEDGES THAT THE UNDERSIGNED HAS BEEN ADVISED BY LEGAL COUNSEL AND IS FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
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THE UNDERSIGNED, BEING AWARE OF SAID CODE SECTION, HEREBY EXPRESSLY WAIVES ANY RIGHTS THE UNDERSIGNED MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.
4. Exceptions. Notwithstanding anything in this Release to the contrary, nothing contained in this Release shall prohibit the undersigned from (i) filing a charge with, reporting possible violations of federal law or regulation to, participating in any investigation by, or cooperating with any governmental agency or entity or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation and/or (ii) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to, any federal, state or local government regulator (including, but not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission, or the U.S. Department of Justice) for the purpose of reporting or investigating a suspected violation of law, or from providing such information to the undersigned’s attorney or in a sealed complaint or other document filed in a lawsuit or other governmental proceeding. Pursuant to 18 USC Section 1833(b), the undersigned will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (y) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
5. Representations; Continuing Obligations. The undersigned represents and warrants that there has been no assignment or other transfer of any interest in any Claim which the undersigned may have against Releasees, or any of them, and the undersigned agrees to indemnify and hold Releasees, and each of them, harmless from any liability, Claims, demands, damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of them, as the result of any such assignment or transfer or any rights or Claims under any such assignment or transfer. It is the intention of the parties that this indemnity does not require payment as a condition precedent to recovery by the Releasees against the undersigned under this indemnity. The undersigned hereby expressly reaffirms his obligations under Section 6 of the Employment Agreement, and agrees that such obligations shall survive the termination of the undersigned’s employment.
6. No Action. The undersigned agrees that if the undersigned hereafter commences any suit arising out of, based upon, or relating to any of the Claims released hereunder or in any manner asserts against Releasees, or any of them, any of the Claims released hereunder, then the undersigned agrees to pay to Releasees, and each of them, in addition to any other damages caused to Releasees thereby, all attorneys’ fees incurred by Releasees in defending or otherwise responding to said suit or Claim.
7. No Admission. The undersigned further understands and agrees that neither the payment of any sum of money nor the execution of this Release shall constitute or be construed as an admission of any liability whatsoever by the Releasees, or any of them, who have consistently taken the position that they have no liability whatsoever to the undersigned.
8. OWBPA. The undersigned agrees and acknowledges that this Release constitutes a knowing and voluntary waiver and release of all Claims the undersigned has or may have against the Company and/or any of the Releasees as set forth herein, including, but not limited to, all Claims arising under the Older Workers Benefit Protection Act and the Age Discrimination in Employment Act. In accordance with the Older Workers Benefit Protection Act, the undersigned is hereby advised as follows:
(a) the undersigned has read the terms of this Release, and understands its terms and effects, including the fact that the undersigned agreed to release and forever discharge the Company and each of the Releasees, from any Claims released in this Release;
(b) the undersigned understands that, by entering into this Release, the undersigned
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does not waive any Claims that may arise after the date of the undersigned’s execution of this Release, including without limitation any rights or claims that the undersigned may have to secure enforcement of the terms and conditions of this Release;
(c) the undersigned has signed this Release voluntarily and knowingly in exchange for the consideration described in this Release, which the undersigned acknowledges is adequate and satisfactory to the undersigned and which the undersigned acknowledges is in addition to any other benefits to which the undersigned is otherwise entitled;
(d) the Company advises the undersigned to consult with an attorney prior to executing this Release;
(e) the undersigned has been given at least 21 days in which to review and consider this Release. To the extent that the undersigned chooses to sign this Release prior to the expiration of such period, the undersigned acknowledges that the undersigned has done so voluntarily, had sufficient time to consider the Release, to consult with counsel and that the undersigned does not desire additional time and hereby waives the remainder of the 21-day period; and
(f) the undersigned may revoke this Release within seven (7) days from the date the undersigned signs this Release and this Release will become effective upon the expiration of that revocation period if the undersigned has not revoked this Release during such seven-day period. If the undersigned revokes this Release during such seven-day period, this Release will be null and void and of no force or effect on either the Company or the undersigned and the undersigned will not be entitled to any of the payments or benefits which are expressly conditioned upon the execution and non-revocation of this Release. Any revocation must be in writing and sent to [name], via electronic mail at [email address], on or before 5:00 p.m. Pacific time on the seventh day after this Release is executed by the undersigned.]
9. Governing Law and Venue. This Release is deemed made and entered into in the State of Utah and in all respects shall be interpreted, enforced and governed under the internal laws of the State of Utah, to the extent not preempted by federal law. Any suit brought hereon shall be brought in the state or federal courts sitting in Salt Lake City, Utah, the parties hereby waiving any claim or defense that such forum is not convenient or proper. Each party hereby agrees that any such court shall have in personam jurisdiction over it and consents to service of process in any manner authorized by Utah law.
10. Severability. In the event any provision of this Release is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.
11. Counterparts. This Release may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement. This Release may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
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IN WITNESS WHEREOF, the undersigned has executed this Release this day of , .
|
|
| Dean Allara |
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EXHIBIT B
PARTNER ALUMNA/ALUMNUS AND PARTNER EMERITA/EMERITUS TERMS AND CONDITIONS
PARTNER ALUMNA/ALUMNUS:
Eligibility: To be eligible to be named as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive must:
(a) Have been a Partner in the Partnership for at least five years prior to the termination of the Employment Period,
(b) Unless otherwise determined by the Board, retain at least 60,000 shares of the Class A common stock of Parent (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable, or redeemable for, shares of Class A common stock of Parent (including interests of the Partnership));
(c) Timely sign and not revoke the Release; and
(d) Remain in compliance with the Agreement and the Restrictive Covenant Agreements and must not be employed by or consult with a competitor as determined solely by the Board.
Obligations: In order to continue to retain his or her status as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive must:
(a) Be available as a mentor for at least one high potential future leader;
(b) Be available for advice and counsel to the Company from time to time;
(c) As requested by the Board, be willing to serve on at least one Company committee (e.g., ESG, DE&I, etc.);
(d) Be willing to promote the Company and its investment vehicles as appropriate.
Benefits: During Executive’s period of service as a Partner Alumna/Alumnus following the termination of the Employment Period, Executive shall be eligible to:
(a) Receive Company-arranged financing, to the extent generally available to employees of the Company, for acquiring limited-partner interests in Company-sponsored funds on terms generally available to employees;
(b) Receive a waiver of management fees or carried interest for any limited-partner investments in any Company-sponsored fund (up to a maximum of $5.0 million committed capital per fund);
(c) Be invited to attend summer and holiday Company parties; and
(d) Be invited to, and expected to attend, an annual reunion dinner hosted by the Chairman.
B-1
PARTNER EMERITA/EMERITUS:
Eligibility: To be eligible to be named as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive must:
(a) Have been a Partner in the Partnership for at least ten years prior to the termination of the Employment Period,
(b) Unless otherwise determined by the Board, retain at least 300,000 shares of the Class A common stock of Parent (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable, or redeemable for, shares of Class A common stock of Parent (including interests of the Partnership));
(c) Timely sign and not revoke the Release; and
(d) Remain in compliance with the Agreement and the Restrictive Covenant Agreements and must not be employed by or consult with a competitor as determined solely by the Board.
Obligations: In order to continue to retain his or her status as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive must:
(a) Be available as a mentor for up to two (simultaneous) high potential future leaders;
(b) Be available for advice and counsel to the Company from time to time;
(c) As requested by the Board, be willing to serve on at least one Company committee (e.g., ESG, DE&I, etc.);
(d) Be willing to promote the Company and its investment vehicles as appropriate.
Benefits: During Executive’s period of service as a Partner Emerita/Emeritus following the termination of the Employment Period, Executive shall be eligible to:
(a) Receive Company-arranged financing, to the extent generally available to employees of the Company, for acquiring limited partner interests in Company-sponsored funds on terms generally available to employees;
(b) Receive a waiver of management fees or carried interest for any limited-partner investments in any Company-sponsored fund;
(c) Be invited to attend summer and holiday Company parties; and
(d) Be invited to, and expected to attend, an annual reunion dinner hosted by the Chairman.
B-2
Exhibit 31.1
CERTIFICATION
I, Jonathan Slager, certify that:
| 1. |
I have reviewed this Quarterly Report on Form 10-Q of Bridge Investment Group Holdings Inc.; |
| 2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. |
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: |
| (a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) |
[omitted]; |
| (c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| (d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. |
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| Date: August 16, 2021 | By: |
/s/ Jonathan Slager |
||||
| Jonathan Slager | ||||||
|
Chief Executive Officer (principal executive officer) |
Exhibit 31.2
CERTIFICATION
I, Chad Briggs, certify that:
| 1. |
I have reviewed this Quarterly Report on Form 10-Q of Bridge Investment Group Holdings Inc.; |
| 2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. |
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: |
| (a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) |
[omitted]; |
| (c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| (d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. |
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| Date: August 16, 2021 | By: |
/s/ Chad Briggs |
||||
| Chad Briggs | ||||||
|
Chief Financial Officer (principal financial officer) |
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of Bridge Investment Group Holdings Inc. (the “Company”) for the period ended June 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:
| (1) |
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| (2) |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
| Date: August 16, 2021 | By: |
/s/ Jonathan Slager |
||||
| Jonathan Slager | ||||||
|
Chief Executive Officer (principal executive officer) |
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of Bridge Investment Group Holdings Inc. (the “Company”) for the period ended June 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:
| (1) |
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| (2) |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
| Date: August 16, 2021 | By: |
/s/ Chad Briggs |
||||
| Chad Briggs | ||||||
|
Chief Financial Officer (principal financial officer) |