FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
This First Amendment (this “Amendment”), dated as of August 1, 2018 (the
“Effective Date”), by and between Hostess Brands, LLC (together with Hostess
Brands, Inc., the “Company”) and Andrew P. Callahan (the “Executive”) amends the
Employment Agreement, dated April 12, 2018, (the “Employment Agreement”),
between the Company and the Executive. Capitalized terms used herein but not
defined shall have the meanings ascribed to such terms in the Employment
Agreement.
WHEREAS, the Company and the Executive have agreed upon new contractual terms
governing the Compensation Committee’s grant to the Executive of performance
share units; and
WHEREAS, pursuant to Section 23 of the Employment Agreement, the Company and the
Executive wish to amend the Employment Agreement to provide for these new
contractual terms;
NOW, THEREFORE, in consideration of the premises, and of the agreements and
other good and sufficient consideration set forth herein, the Company and the
Executive hereby agree as follows:
1.Effective as of the Effective Date, Section 2(c) of the Employment Agreement
is hereby deleted in its entirety and replaced with the following:
“(c)    Long Term Incentive Opportunity. In order to further align the Executive
with the Company’s stockholders, the Compensation Committee will grant the
Executive restricted stock units (“RSUs”), non-qualified stock options (“SOs”),
and performance share units (“PSUs”) related to performance during the
performance periods described below, with an aggregate grant date value (based
on the closing price of a share of Company common stock on the Employment Date)
of $2,700,000, subject to the terms and conditions of the Hostess Brands, Inc.
2016 Equity Incentive Plan (the “Equity Incentive Plan”) within ninety (90) days
after the Employment Date (the “Sign-On Equity”). The Sign-On Equity shall vest
as follows: (i) RSUs: in equal or nearly equal installments of one-third of the
award on each of the first, second, and third anniversaries of the Employment
Date, (ii) SOs: in equal or nearly equal installments of one-fourth of the award
on each of the first, second, third, and fourth anniversaries of the Employment
Date and (iii) PSUs: 50% of which shall be subject to vesting on May 7, 2020
based upon the Company’s achievement of the applicable performance goal during
the two-year performance period beginning on May 7, 2018 and ending on May 7,
2020, and 50% of which shall be subject to vesting on May 7, 2021 based upon the
Company’s achievement of the applicable performance goal during the three-year
performance period beginning on May 7, 2018 and ending on May 7, 2021 (each, the
“PSU Vesting Date”), subject, in each case, to the Compensation Committee’s
certification following the applicable performance period of the extent to which
the performance goal has been satisfied, and subject further to the Executive’s
continued employment with the Company through the applicable PSU Vesting Date.
The parties agree that in the event of any termination of Executive’s

--------------------------------------------------------------------------------

employment except by the Company for Cause or a voluntary resignation by the
Executive without Good Reason, the PSUs will become vested based on achievement
of the applicable performance goal through the termination date, and pro-rated
for the Executive’s period of employment, as further described in the applicable
award agreement. The Company and the Executive shall enter into award agreements
for each long term incentive award on terms substantially similar to the
Company’s form award agreements, as revised to reflect the terms set forth
herein. The Executive shall be eligible to receive long-term incentive awards in
respect of each fiscal year after 2018 during the Term under the Equity
Incentive Plan in an amount and on terms established by the Compensation
Committee, with the target award/grant for fiscal years after 2018 expected to
be no less in value than the Sign-On Equity absent material share price declines
or performance shortcomings of the Executive. The Executive’s Sign–On Equity and
subsequent equity grants and related grant agreements shall incorporate the
definitions of Cause and Good Reason provided in this Agreement, and shall
provide for full acceleration of vesting of equity in connection with a Change
in Control Termination as that term is defined in the HB Key Executive Severance
Benefit Plan, as in effect at the time of the Executive’s termination of
employment with the Company (the “Severance Plan”).”
2.    The Employment Agreement, as amended by this Amendment, constitutes the
entire and exclusive agreement between the parties with respect to the subject
matter hereof. All previous discussions and agreements with respect to the
subject matter of this Amendment are superseded by this Amendment.
3.    Except as expressly amended hereby, all terms, conditions and provisions
of the Employment Agreement, as amended, shall remain in full force and effect.
This Amendment shall form a part of the Employment Agreement for all purposes.
4.    This Amendment may be executed in counterparts and by facsimile or other
electronic means, including by portable document format (PDF), each of which
shall be deemed to have the same legal effect as an original and together shall
constitute one and the instrument.
5.    Each party represents and warrants that it has the full power and
authority to enter into this Amendment.

2

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the
date and year first above written.

    
    
 
COMPANY
 
 
 
 
 
 
By:
/s/ Michael J. Cramer
 
 
Name:    
Michael J. Cramer
 
 
Title:
EVP, Chief Administrative Officer
 
 
Date:
August 1, 2018
 
 
 
 
 
 
 
 
 
 
EXECUTIVE
 
 
 
 
 
 
By:
/s/ Andrew P. Callahan
 
 
Name:
Andrew P. Callahan
 
 
Date:
August 1, 2018
 
 
 
 
 

    
    
    

3