Exhibit
10.1


 


Execution
Version


SPONSOR
AGREEMENT


 


This
SPONSOR AGREEMENT (the “Sponsor Agreement”), dated as of March 11, 2021, is entered into by and between Empower
Sponsor Holdings LLC, a Delaware limited liability company (“Sponsor”), Empower Ltd., a Cayman Islands exempted
company limited by shares (“Acquiror”), and Holley Parent Holdings, LLC, a Delaware limited liability company
(“Company Stockholder”).


 


W
I T N E S S E T H:


 


WHEREAS,
concurrently with the execution of this Sponsor Agreement, Acquiror, Holley Intermediate Holdings, Inc., a Delaware corporation
(the “Company”), Empower Merger Sub I Inc., a Delaware corporation and direct wholly owned subsidiary of Acquiror,
and Empower Merger Sub II LLC, a Delaware limited liability company and direct wholly owned subsidiary of Acquiror, will enter
into that certain Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”);


 


WHEREAS,
Sponsor has agreed to waive certain of its anti-dilution and conversion rights;


 


WHEREAS,
Sponsor has agreed to support the Mergers and vote in favor of the Transaction Proposals at any meeting held for voting on such
proposals; and


 


WHEREAS,
Sponsor has agreed to earn-out periods for certain of its shares of Acquiror’s Class B ordinary shares (“Founder
Shares”), subject to the terms and conditions specified herein;


 


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


 


		1.	Definitions.



 


		(a)	“First
                                         Earn-Out Shares” means 1,093,750 shares of Founder Shares held by Sponsor as
                                         of the date first set forth above, and following the consummation of the transactions
                                         contemplated by the Merger Agreement shall mean the equivalent number of shares of common
                                         stock, par value $0.0001, of Acquiror (“Domesticated Acquiror Common Stock”),
                                         as converted and exchanged pursuant to the Merger Agreement and the terms set forth herein.



 


		(b)	“Earn-out
                                         Shares” means, collectively, the First Earn-Out Shares and Second Earn-Out
                                         Shares.



 


		(c)	“Second
                                         Earn-Out Shares” means an additional 1,093,750 shares of Founder Shares held
                                         by Sponsor as of the date first set forth above, and following the consummation of the
                                         transactions contemplated by the Merger Agreement shall mean the equivalent number of
                                         shares of Domesticated Acquiror Common Stock, as converted and exchanged pursuant to
                                         the Merger Agreement and the terms set forth herein.



 






     


     


    




 


		(d)	Capitalized
                                         terms used but not otherwise defined herein shall have the meanings ascribed to such
                                         terms in the Merger Agreement.



 


		2.	Sponsor
                                         Agreement. At any duly called meeting of the shareholders of Acquiror, or at any
                                         postponement or adjournment thereof, and in any action by written consent of the stockholders
                                         of Acquiror requested by Acquiror’s Board of Directors or undertaken as contemplated
                                         by the Merger Agreement, Sponsor shall (i) if a meeting is held, appear at each such
                                         meeting in person or by proxy or otherwise cause all of its Acquiror Common Stock to
                                         be counted as present thereat for purposes of calculating a quorum and (ii) vote (or
                                         cause to be voted), or execute and deliver a written consent (or cause a written consent
                                         to be executed and delivered) covering, all of its Acquiror Common Stock in favor of
                                         each Transaction Proposal;



 


		3.	Waiver
                                         and Earn-Out.



 


		(a)	Immediately
                                         prior to, and conditioned upon, the Company Merger I Effective Time, Sponsor shall, automatically
                                         and without any further action by Sponsor or Acquiror, irrevocably waive its respective
                                         rights under the anti-dilution and conversion provisions of Section 17.3 of the Amended
                                         and Restated Memorandum of Association of the Acquiror, dated October 6, 2020 (the “Acquiror
                                         Charter”), with respect to each of its Founder Shares held as of the date hereof,
                                         and such Founder Shares shall, automatically and without any further action by Sponsor,
                                         be converted to and exchanged for Domesticated Acquiror Common Stock on a one-for-one
                                         basis as provided in Section 17.2 of the Acquiror Charter at the Domestication Effective
                                         Time.



 


		(b)	Sponsor
                                         agrees that following the Effective Time and notwithstanding anything to the contrary,
                                         the First Earn-Out Shares shall vest at such time as (x) the closing price of the Domesticated
                                         Acquiror Common Stock equals or exceeds $13.00 per share as quoted on the New York Stock
                                         Exchange (adjusted for stock splits, stock dividends, reorganizations, recapitalizations
                                         and the like) for any 20 trading days within any 30-trading day period or (y) Acquiror
                                         (or its successor) completes a liquidation, merger, capital stock exchange, reorganization
                                         or other similar transaction that results in all of the Acquiror’s (or its successor’s)
                                         stockholders having the right to exchange their Domesticated Acquiror Common Stock for
                                         cash, securities or other property at a price per share equal to or exceeding $13.00
                                         per share, provided, that in the event that the First Earn-Out Shares have not vested
                                         on the date that is seven (7) years from the Effective Time, all such First Earn-Out
                                         Shares shall be forfeited for no consideration.



 


		(c)	Sponsor
                                         agrees that following the Effective Time and notwithstanding anything to the contrary,
                                         the Second Earn-Out Shares shall vest at such time as (x) the closing price of the Domesticated
                                         Acquiror Common Stock equals or exceeds $15.00 per share as quoted on the New York Stock
                                         Exchange (adjusted for stock splits, stock dividends, reorganizations, recapitalizations
                                         and the like) for any 20 trading days within any 30-trading day period or (y) Acquiror
                                         (or its successor) completes a liquidation, merger, capital stock exchange, reorganization
                                         or other similar transaction that results in all of the Acquiror’s (or its successor’s)
                                         stockholders having the right to exchange their Domesticated Acquiror Common Stock for
                                         cash, securities or other property at a price per share equal to or exceeding $15.00
                                         per share, provided, that in the event that the Second Earn-Out Shares have not vested
                                         on the date that is seven (7) years from the Effective Time, all such Second Earn-Out
                                         Shares shall be forfeited for no consideration.



 






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		(d)	If,
                                         prior to vesting, the outstanding Domesticated Acquiror Shares shall have been changed
                                         into a different number of shares or a different class, by reason of any stock dividend,
                                         subdivision, reclassification, recapitalization, split, combination, or exchange of shares,
                                         or any similar event shall have occurred, then any number, value (including dollar value),
                                         or amount contained herein which is based upon the number of Domesticated Acquiror Shares
                                         will be appropriately adjusted (as determined by the board of directors of Acquiror in
                                         good faith) to provide to Sponsor the same economic effect as contemplated by this Sponsor
                                         Agreement prior to such event. For the avoidance of doubt, Earn-Out Shares shall be able
                                         to participate in any dividend on Domesticated Acquiror Shares following the Effective
                                         Time.



 


		(e)	Other
                                         than as set forth in Paragraph 3(f), below, no holder of Earn-Out Shares shall
                                         Transfer any Earn-Out Shares to the extent such Earn-Out Shares are still subject to
                                         restrictions under this Paragraph 3 at the time of the contemplated Transfer and
                                         all certificates representing such Earn-Out Shares shall contain a legend to such effect.
                                         Notwithstanding anything in this Sponsor Agreement to the contrary, following the Effective
                                         Time, the Earn-Out Shares shall be subject to the same restrictions as all other Founder
                                         Shares.



 


		(f)	As
                                         used herein, “Transfer” shall mean the (a) sale of, offer to sell,
                                         contract or agreement to sell, hypothecate, pledge, grant of any option to purchase or
                                         otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment
                                         or increase of a put equivalent position or liquidation with respect to or decrease of
                                         a call equivalent position within the meaning of Section 16 of the Securities Exchange
                                         Act of 1934, as amended, and the rules and regulations of the Securities and Exchange
                                         Commission promulgated thereunder with respect to, any security, (b) entry into any swap
                                         or other arrangement that transfers to another, in whole or in part, any of the economic
                                         consequences of ownership of any security, whether any such transaction is to be settled
                                         by delivery of such securities, in cash or otherwise, or (c) public announcement of any
                                         intention to effect any transaction specified in clause (a) or (b)); provided,
                                         however, that nothing in this Paragraph 3(f) shall prevent Transfers to
                                         (i) the Company’s officers, the Company’s directors, members of the Company’s
                                         advisory board, any affiliates or family members of any of the Company’s officers
                                         or directors, any direct or indirect members or partners of the Sponsor or their affiliates,
                                         any affiliates of the Sponsor, including to funds affiliated with MidOcean US Advisor,
                                         LP (“MidOcean”), and to direct or indirect members or partners of
                                         funds affiliated with MidOcean or any affiliates thereof, or any employees of such affiliates;
                                         (ii) in the case of an individual, by virtue of laws of descent and distribution upon
                                         death of the individual; (iii) in the case of an individual, pursuant to a qualified
                                         domestic relations order; (iv) by virtue of the Sponsor’s organizational documents
                                         upon liquidation or dissolution of the Sponsor; (v) in the event of the Company’s
                                         liquidation prior to the completion of the Business Combination; or (vi) in the event
                                         of completion of a liquidation, merger, share exchange or other similar transaction which
                                         results in all of the Acquiror’s public shareholders having the right to exchange
                                         their Domesticated Acquiror Common Stock for cash, securities or other property subsequent
                                         to the completion of the Business Combination; provided, however, that
                                         in the case of clauses (i) through (iv) these permitted transferees must enter into a
                                         written agreement agreeing to be bound by these transfer restrictions.



 






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		4.	Sponsor
                                         Representations and Warranties. Sponsor hereby represents and warrants as of the
                                         date hereof as follows:



 


		(a)	Sponsor
                                         is the sole record and beneficial owner of the Earn-Out Shares, free and clear of all
                                         Liens other than transfer restrictions imposed by applicable securities laws.



 


		(b)	Sponsor
                                         is duly organized, validly existing and in good standing under the laws of Delaware and
                                         has all requisite power and authority to execute and deliver this Sponsor Agreement and
                                         to consummate the transactions contemplated hereby and to perform all of its obligations
                                         hereunder. The execution and delivery of this Sponsor Agreement has been, and the consummation
                                         of the transactions contemplated hereby have been, duly authorized by all requisite action
                                         by Sponsor. This Sponsor Agreement has been duly and validly executed and delivered by
                                         Sponsor and, assuming this Sponsor Agreement has been duly authorized, executed and delivered
                                         by the other parties hereto, this Sponsor Agreement constitutes, and upon its execution
                                         will constitute, a legal, valid and binding obligation of Sponsor enforceable against
                                         it in accordance with its terms.



 


		(c)	Upon
                                         execution of this Sponsor Agreement, the waiver provided for in Paragraph 2(a)
                                         herein shall constitute a written consent of the holder of a majority of Founder Shares,
                                         duly authorized and executed in accordance with Section 17.4 of the Acquiror Charter.



 


		(d)	Sponsor
                                         understands and acknowledges that each of Acquiror and the Company is entering into the
                                         Merger Agreement in reliance upon Sponsor’s execution and delivery of this Sponsor
                                         Agreement.



 


		5.	Successors
                                         and Assigns. Sponsor acknowledges and agrees that the terms of this Sponsor Agreement
                                         are binding on and shall inure to the benefit of their respective beneficiaries, heirs,
                                         legatees and other statutorily designated representatives. Sponsor also understands that
                                         this Sponsor Agreement, once executed, is irrevocable and binding, and if Sponsor Transfers
                                         any shares of Domesticated Acquiror Common Stock held by Sponsor as of the date of this
                                         Agreement or held by Sponsor after giving effect to the conversion pursuant to Paragraph
                                         3 above, the transferee shall execute a joinder to this agreement in the form reasonably
                                         acceptable to the Acquiror and the Company Stockholder. Any attempted transfer or assignment
                                         in violation of the terms of this Paragraph 5 shall be null and void, ab initio,
                                         provided that the Company Stockholder may transfer or assign any of its rights hereunder
                                         to any single person or entity who is an Affiliate of the Company Stockholder.



 






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		6.	Termination.
                                         This Sponsor Agreement shall terminate, and have no further force and effect, as of the
                                         earlier to occur of (a) the vesting or forfeiture of the Earn-Out Shares and (b) the
                                         termination of the Merger Agreement in accordance with its terms prior to the Domestication
                                         Effective Time. This Sponsor Agreement may be executed in counterparts (including by
                                         electronic means), all of which shall be considered one and the same agreement and shall
                                         become effective when signed by each of the parties and delivered to the other parties,
                                         it being understood that all parties need not sign the same counterpart.



 


		7.	Specific
                                         Performance. The parties hereto agree that irreparable damage may occur in the event
                                         that any of the provisions of this Sponsor Agreement were not performed in accordance
                                         with their specific terms or were otherwise breached. It is accordingly agreed that the
                                         parties hereto shall be entitled to seek an injunction or injunctions to prevent breaches
                                         of this Sponsor Agreement and to enforce specifically the terms and provisions of this
                                         Sponsor Agreement in the chancery court or any other state or federal court within the
                                         State of Delaware, this being in addition to any other remedy to which such party is
                                         entitled at law or in equity.



 


		8.	Amendment.
                                         This Sponsor Agreement may not be amended, changed, supplemented, waived or otherwise
                                         modified or terminated, except upon the execution and delivery of a written agreement
                                         executed by the Company Stockholder and Sponsor.



 


		9.	Severability.
                                         If any provision of this Sponsor Agreement is held invalid or unenforceable by any court
                                         of competent jurisdiction, the other provisions of this Sponsor Agreement will remain
                                         in full force and effect. Any provision of this Sponsor Agreement held invalid or unenforceable
                                         only in part or degree will remain in full force and effect to the extent not held invalid
                                         or unenforceable.



 


		10.	Governing
                                         Law. All issues and questions concerning the construction, validity, interpretation
                                         and enforceability of this Sponsor Agreement shall be governed by and construed in accordance
                                         with the laws of the State of Delaware, without giving effect to any choice of law or
                                         conflict of law rules or provisions (whether of the State of Delaware or any other jurisdiction)
                                         that would cause the application of the laws of any jurisdiction other than the State
                                         of Delaware. The parties hereto (i) all agree that any action, proceeding, claim or dispute
                                         arising out of, or relating in any way to, this Sponsor Agreement shall be brought and
                                         enforced in the courts of the State of Delaware or the federal courts located in the
                                         State of Delaware, and irrevocably submit to such jurisdiction and venue, which jurisdiction
                                         and venue shall be exclusive and (ii) waive any objection to such exclusive jurisdiction
                                         and venue or that such courts represent an inconvenient forum.



 


		11.	Waiver
                                         of Jury Trial. EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
                                         WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES,
                                         AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT
                                         SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY PROCEEDING DIRECTLY OR INDIRECTLY
                                         ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
                                         AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR
                                         ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER
                                         PARTY WOULD NOT, IN THE EVENT OF A PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER,
                                         (B) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C)
                                         EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) EACH SUCH PARTY HAS BEEN INDUCED
                                         TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
                                         IN THIS PARAGRAPH 11.



 


[signature
page follows]


 




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


 


	 	EMPOWER SPONSOR HOLDINGS LLC
	 	 
	 	/s/
    Andrew Spring
	 	Name: 	Andrew Spring
	 	Title: 	CFO
	 	 
	 	EMPOWER LTD.
	 	 
	 	/s/
    Matthew Rubel
	 	Name: 	Matthew Rubel
	 	Title: 	CEO
	 	 
	 	HOLLEY PARENT HOLDINGS, LLC
	 	 
	 	/s/ James D. Coady 
	 	Name:	James D. Coady 
	 	Title:	President 


  


[Signature Page to Sponsor Agreement]