Document:

Exhibit

Exhibit 10.3

As of January 1, 2018
Scott Mills
c/o Black Entertainment Television LLC
1515 Broadway
New York, NY 10036
Dear Mr. Mills:
Black Entertainment Television LLC (the “Company”) agrees to employ you, and you accept such employment, on the terms and conditions set forth in this letter agreement (“Agreement”).  For purposes of this Agreement, “Viacom” shall mean Viacom Inc. and its subsidiaries.  
1.    Contract Period.  The term of your employment under this Agreement shall begin on January 1, 2018 (the “Effective Date”) and, unless terminated earlier as set forth herein, shall continue through and including June 30, 2020.  The period from the Effective Date through June 30, 2020 is referred to as the “Contract Period”, even if your employment terminates earlier for any reason.
2.    Duties.   You shall devote your entire business time, attention and energies to the business of the Company during your employment with the Company.  You shall be President, BET Networks and you shall perform all duties reasonable and consistent with such office as may be assigned to you from time to time by the President and Chief Executive Officer of Viacom Inc.
3.    Compensation.
(a)    Salary.  The Company shall pay you base salary (as may be increased, “Salary”) at a rate of One Million Seven Hundred Fifty Thousand Dollars ($1,750,000) per year for all of your services as an employee.  Your Salary shall be subject to merit reviews, on or about an annual basis, while actively employed during the Contract Period and may, at that time, be increased but not decreased.  Your Salary, less deductions and income and payroll tax withholding as may be required under applicable law, shall be payable in accordance with the Company’s ordinary payroll policy, but no less frequently than monthly.
(b)    Bonus.  You also shall be eligible to earn a bonus (“Bonus”) or a Pro-Rated Bonus (as defined in paragraph 19(e)(ii)), as applicable, determined as set forth below and in paragraph 19(e)(ii).
		
	(i)
	Your Bonus for each Company fiscal year, regardless of whether such fiscal year is a 12-month period or a shorter period of time, shall be determined in accordance with the Viacom Inc. Short-Term Incentive Plan, as applicable, as it may be amended from time to time (the “STIP”). 

		
	(ii)
	Your target Bonus for each Company fiscal year during the Contract Period shall be Two Million Five Hundred Thousand Dollars ($2,500,000) (your “Target Bonus”) and shall be adjusted based on the Company’s performance (the “Company Performance Factor”) and your individual performance (the “Individual Performance Factor”), in each case as determined by the Company or Viacom and as further provided in the STIP.  

BET NETWORKS   |  1540 BROADWAY, 27TH FLOOR  |   NEW YORK, NY  10036   |   TEL: 212.205.3000

Mr. Scott Mills
January 1, 2018
Page 2

(c)    Long-Term Incentive Compensation.   During your employment under this Agreement, you shall be eligible to participate in the Viacom Inc. 2016 Long-Term Management Incentive Plan, or  any successor plan, at a level appropriate to your position and individual performance as determined by the Viacom Inc. Board of Directors (the "Board") or a committee of the Board, in its discretion based on a target value of Two Million Two Hundred Fifty Thousand Dollars ($2,250,000).
(d)    Compensation During Short-Term Disability.  Your compensation for any period that you are absent due to a short-term disability (“STD”) and are receiving compensation under a Viacom STD plan shall be determined in accordance with the terms of such STD plan.  The compensation provided to you under the applicable STD plan shall be in lieu of the Salary provided under this Agreement.  Your participation in any other Viacom benefit plans or programs shall be governed by the terms of the applicable plan or program documents, award agreements and certificates. 
4.    Benefits.  
(a)    General Benefits.  During your employment under this Agreement, you shall be eligible to participate in any paid time off programs, medical and dental plans and life insurance plans, STD and long-term disability (“LTD”) plans, retirement and other employee benefit plans the Company may have, establish or maintain from time to time and for which you qualify pursuant to the terms of the applicable plan.  
(b)    Life Insurance.  The Company shall provide you with no less than Five Million Dollars ($5,000,000) of life insurance coverage during the Contract Period.  
5.    Business Expenses.  During your employment under this Agreement, the Company shall reimburse you for such reasonable travel and other expenses, incurred in the performance of your duties in accordance with the Company’s policies, as are customarily reimbursed to Company executives at comparable levels.
6.    Non-Competition and Non-Solicitation.
(a)    Non-Competition.  
		
	(i)
	Your employment with the Company is on an exclusive and full-time basis, and while you are employed by the Company, you shall not engage in any other business activity which is in conflict with your duties and obligations (including your commitment of time) to the Company.  During the Non-Competition Period, you shall not directly or indirectly engage in or participate as an owner, partner, holder or beneficiary of stock, stock options or other equity interest, officer, employee, director, manager, partner or agent of, or consultant for, any business competitive with any business of Viacom without the prior written consent of the Company.  This provision shall not limit your right to own and have options or other rights to purchase not more than one percent (1%) of any of the debt or equity securities of any business organization that is then filing reports with the Securities and Exchange Commission pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, unless such ownership constitutes a significant portion of your net worth.  

Mr. Scott Mills
January 1, 2018
Page 3

		
	(ii)
	The “Non-Competition Period” begins on the Effective Date and ends on the last day of the Contract Period, provided that:

		
	1. 
	If the Company terminates your employment without Cause or if you validly resign for Good Reason before the end of the Contract Period, then the Non-Competition Period shall end on the earlier of (i) the end of the period in which you are receiving payments pursuant to paragraph 11(c)(i) or (ii) the effective date of your waiver in writing of any right to receive or continue to receive compensation and benefits under paragraph 11.  You shall be deemed to have irrevocably provided such waiver if you accept competing employment.

		
	2. 
	If the Company terminates your employment for Cause or you resign other than for Good Reason, the Non-Competition Period shall end on the earlier of (i) the last day of the Contract Period or (ii) eighteen (18) months after such termination or resignation.  

(b)    Non-Solicitation.  
		
	(i)
	During the Non-Solicitation Period, you shall not directly or indirectly engage or attempt to engage in any of the following acts: 

		
	1. 
	Employ or solicit the employment of any person who is then, or has been within six (6) months prior thereto, an employee of Viacom; or

		
	2. 
	Interfere with, disturb or interrupt the relationships (whether or not such relationships have been reduced to formal contracts) of Viacom with any customer, supplier, independent contractor, consultant, joint venture or other business partner (to the extent each of the limitations in this paragraph 6(b)(i)(2) is permitted by applicable law).  

		
	(ii)
	The “Non-Solicitation Period” begins on the Effective Date and ends on the last day of the Contract Period, or, if longer, eighteen (18) months after the Company terminates your employment for Cause or you resign other than for Good Reason.

(c)    Severability.  If any court determines that any portion of this Section 6 is invalid or unenforceable, the remainder of this Section 6 shall not thereby be affected and shall be given full effect without regard to the invalid provisions.  If any court construes any of the provisions of this Section 6, or any part thereof, to be unreasonable because of the duration or scope of such provision, such court shall have the power to reduce the duration or scope of such provision and to enforce such provision as so reduced.
7.    Confidentiality and Other Obligations.
(a)    Confidential Information.  You shall not use for any purpose or disclose to any third party any information relating to Viacom, Viacom’s clients or other parties with which Viacom has a relationship, or that may provide Viacom with a competitive advantage (“Confidential Information”), other than (i) in the performance of your duties under this Agreement consistent with the Company’s or Viacom's policies or (ii) as may otherwise be required by law or legal process; provided, however, that 

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January 1, 2018
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nothing in the foregoing prohibits you from reporting what you in good faith believe to be violations of federal law to any governmental agency you in good faith believe to have responsibility for enforcement of such law or from making any other disclosure that is protected under the whistleblower protections of federal law.  Confidential Information shall include, without limitation, trade secrets; inventions (whether or not patentable); technology and business processes; business, product or marketing plans; negotiating strategies;  sales and other forecasts; financial information; client lists or other intellectual property; information relating to compensation and benefits; public information that becomes proprietary as a result of Viacom’s compilation of that information for use in its business; documents (including any electronic record, videotapes or audiotapes) and oral communications incorporating Confidential Information.  You shall also comply with any and all confidentiality obligations of Viacom to a third party of which you are aware, whether arising under a written agreement or otherwise.  Information shall not be deemed Confidential Information if it is or becomes generally available to the public other than as a result of an unauthorized disclosure or action by you or at your direction. 
(b)    Interviews, Speeches or Writings About Viacom.  Except in the performance of your duties under this Agreement consistent with Viacom’s policies, you shall obtain the express authorization of the Company before (i) giving any speeches or interviews or (ii) preparing or assisting any person or entity in the preparation of any books, articles, radio broadcasts, electronic communications, television or motion picture productions or other creations, in either case concerning Viacom or any of its respective businesses, officers, directors, agents, employees, suppliers or customers.  
(c)    Non-Disparagement.  You shall not, directly or indirectly, in any communications with any reporter, author, producer or any similar person or entity, the press or other media, or any customer, client or supplier of Viacom, criticize, ridicule or make any statement which is negative, disparages or is derogatory of Viacom or any of its directors or senior officers.  
(d)    Scope and Duration.  The provisions of paragraph 7(a) shall be in effect during the Contract Period and at all times thereafter.  The provisions of paragraphs 7(b) and 7(c) shall be in effect during the Contract Period and for one (1) year thereafter and such provisions shall apply to all formats and platforms now known or hereafter developed, whether written, printed, oral or electronic, including, without limitation, e-mails, “blogs”, internet sites, chat or news rooms, podcasts or any online forum. 
8.    Viacom Property.
(a)    Viacom Ownership. 
		
	(i)
	The results and proceeds of your services to the Company,  whether or not created during the Contract Period, including, without limitation, any works of authorship resulting from your services and any works in progress resulting from such services, shall be works-made-for-hire and Viacom shall be deemed the sole owner throughout the universe of any and all rights of every nature in such works, with the right to use, license or dispose of the works in perpetuity in any manner Viacom determines in its sole discretion without any further payment to you, whether such rights and means of use are now known or hereafter defined or discovered.  

		
	(ii)
	If, for any reason, any of the results and proceeds of your services to the Company are not legally deemed a work-made-for-hire and/or there are any rights in such results and proceeds which do not accrue to Viacom  under this paragraph 8(a), then you hereby irrevocably assign any and all of your right, title 

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January 1, 2018
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and interest thereto, including, without limitation, any and all copyrights, patents, trade secrets, trademarks and/or other rights of every nature in the work, and Viacom shall have the sole right to use, license or dispose of the work in perpetuity throughout the universe in any manner Viacom determines in its sole discretion without any further payment to you, whether such rights and means of use are now known or hereafter defined or discovered.  
		
	(iii)
	Upon request by the Company, whether or not during the Contract Period, you shall do any and all things which the Company may deem useful or desirable to establish or document Viacom’s rights in the results and proceeds of your services to the Company, including, without limitation, the execution of appropriate copyright, trademark and/or patent applications, assignments or similar documents.  You hereby irrevocably designate the General Counsel, Secretary or any Assistant Secretary of Viacom Inc. as your attorney-in-fact with the power to take such action and execute such documents on your behalf.  To the extent you have any rights in such results and proceeds that cannot be assigned as described above, you unconditionally and irrevocably waive the enforcement of such rights.  

		
	(iv)
	The provisions of this paragraph 8(a) do not limit, restrict, or constitute a waiver by Viacom of any ownership rights to which Viacom may be entitled by operation of law by virtue of being your employer.  

(b)    Return of Property.  All documents, data, recordings, or other property, whether tangible or intangible, including all information stored in electronic form, obtained or prepared by or for you and utilized by you in the course of your employment with the Company shall remain the exclusive property of Viacom and shall remain in Viacom’s exclusive possession at the conclusion of your employment.  
9.    Legal Matters.
(a)    Communication.   Except as required by law or legal process or at the request of the Company, you shall not communicate with anyone (other than your attorneys who agree to keep such matters confidential), except to the extent necessary in the performance of your duties under this Agreement in accordance with Viacom Inc.’s policies, with respect to the facts or subject matter of any claim, litigation, regulatory or administrative proceeding directly or indirectly involving Viacom (“Viacom Legal Matter”) without obtaining the prior consent of Viacom Inc. or its counsel; provided, however, that nothing in the foregoing prohibits you from reporting what you in good faith believe to be violations of federal law to any governmental agency you in good faith believe to have responsibility for enforcement of such law or from making any other disclosure that is protected under the whistleblower protections of federal law.
(b)    Cooperation.  You agree to cooperate with Viacom and its attorneys in connection with any Viacom Legal Matter or Company investigation.  Your cooperation shall include, without limitation, providing assistance to and meeting with Viacom’s counsel, experts or consultants, and providing truthful testimony in pretrial and trial or hearing proceedings.  In the event that your cooperation is requested after the termination of your employment, Viacom shall (i) seek to minimize interruptions to your schedule to the extent consistent with its interests in the matter; and (ii) reimburse you for all reasonable and appropriate out-of-pocket expenses actually incurred by you in connection with such cooperation upon reasonable substantiation of such expenses.

Mr. Scott Mills
January 1, 2018
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(c)    Testimony.  Except as required by law or legal process or at the request of Viacom Inc., you shall not testify in any lawsuit or other proceeding which directly or indirectly involves Viacom, or which is reasonably likely to create the impression that such testimony is endorsed or approved by Viacom.  
(d)    Notice to Viacom.  If you are requested or if you receive legal process requiring you to provide testimony, information or documents (including electronic documents) in any Viacom Legal Matter or that otherwise relates, directly or indirectly, to Viacom or any of its officers, directors, employees or affiliates, you shall give prompt notice of such event to Viacom Inc.’s General Counsel and you shall follow any lawful direction of Viacom Inc.’s General Counsel or his/her designee with respect to your response to such request or legal process. 
(e)    Adverse Party.  The provisions of this paragraph 9 shall not apply to any litigation or other proceeding in which you are a party adverse to Viacom; provided, however, that Viacom expressly reserves its rights under paragraph 7 and its attorney-client and other privileges and immunities, including, without limitation, with respect to its documents and Confidential Information, except if expressly waived in writing by Viacom Inc.’s General Counsel or his/her designee.
(f)    Duration.  The provisions of this paragraph 9 shall apply during the Contract Period and at all times thereafter, and shall survive the termination of your employment with the Company, with respect to any Viacom Legal Matter arising out of or relating to the business in which you were engaged during your employment with the Company.  As to all other Viacom Legal Matters, the provisions of this paragraph 9 shall apply during the Contract Period and for one year thereafter or, if longer, during the pendency of any Viacom Legal Matter which was commenced, or which Viacom received notice of, during such period. 
10.    Termination for Cause.  
(a)    Termination Payments.  The Company may terminate your employment under this Agreement for Cause and thereafter shall have no further obligations to you under this Agreement or otherwise, except for any earned but unpaid Salary through and including the date of termination of employment and any other amounts or benefits required to be paid or provided by law or under any plan of the Company (the “Accrued Compensation and Benefits”).  Without limiting the generality of the preceding sentence, upon termination of your employment for Cause, you shall have no further right to any Bonus or to exercise or redeem any stock options or other equity compensation.  
(b)    Cause Definition.  “Cause” shall mean:  (i) conduct constituting embezzlement, material misappropriation or fraud, whether or not related to your employment with the Company; (ii) conduct constituting a felony, whether or not related to your employment with the Company; (iii) conduct constituting a financial crime, material act of dishonesty or material unethical business conduct, involving Viacom; (iv) willful unauthorized disclosure or use of Confidential Information; (v) the failure to substantially obey a material lawful directive that is appropriate to your position from a superior in your reporting line or the Board; (vi) your material breach of any material obligation under this Agreement; (vii) the failure or refusal to substantially perform your material obligations under this Agreement (other than any such failure or refusal resulting from your STD or LTD); (viii) the willful failure to cooperate with a bona fide internal investigation or an investigation by regulatory or law enforcement authorities, whether or not related to employment with the Company, after being instructed by Viacom to cooperate; (ix) the willful destruction of or willful failure to preserve documents or other material known to be relevant to any investigation referred to in subparagraph (viii) above; or (x) the willful inducement of 

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January 1, 2018
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others to engage in the conduct described in subparagraphs (i) – (ix), including, without limitation, with regard to subparagraph (vi), obligations of others to Viacom.  
(c)    Notice/Cure.  The Company shall give you written notice prior to terminating your employment for Cause or, if no cure period is applicable, contemporaneous with termination of your employment for Cause, setting forth in reasonable detail the nature of any alleged failure, breach or refusal in reasonable detail and the conduct required to cure such breach, failure or refusal.  Except for a failure, breach or refusal which, by its nature, cannot reasonably be expected to be cured, you shall have ten (10) business days from the giving of such notice within which to cure; provided, however, that, if the Company reasonably expects irreparable injury from a delay of ten (10) business days, the Company may give you notice of such shorter period within which to cure as is reasonable under the circumstances, which may include the termination of your employment without notice and with immediate effect.
11.    Resignation for Good Reason and Termination Without Cause.
(a)    Resignation for Good Reason.  
		
	(i)
	You may resign for Good Reason at any time that you are actively employed during the Contract Period by written notice to the Company no more than thirty (30) days after the occurrence of the event constituting Good Reason.  Such notice shall state the grounds for such Good Reason resignation and an effective date no earlier than thirty (30) business days after the date it is given.  The Company shall have thirty (30) business days from the giving of such notice within which to cure and, in the event of such cure, your notice shall be of no further force or effect.  

		
	(ii)
	“Good Reason” shall mean without your consent (other than in connection with the termination or suspension of your employment or duties for Cause or in connection with your death or LTD):  (i) the assignment to you of duties or responsibilities substantially inconsistent with your position(s) or duties; (ii) the withdrawal of material portions of your duties; (iii) the material breach by the Company of any material obligation under this Agreement; or (iv) the Company requiring that you report directly to an individual other than the Company’s President and CEO (other than in the event that the network business of Viacom expands and Viacom forms a group that includes the Company).

(b)    Termination Without Cause.  The Company may terminate your employment under this Agreement without Cause at any time during the Contract Period by written notice to you.  
(c)    Termination Payments/Benefits.  In the event that your employment terminates under paragraph 11(a) or (b), you shall thereafter receive the compensation and benefits described below and the following shall apply:
		
	(i)
	The Company shall continue to pay your Salary (at the rate in effect on the date of termination) at the same time and in the same manner as if you had not terminated employment for the longer of one (1) year or until the end of the Contract Period;

		
	(ii)
	You shall be eligible to receive a Bonus or Pro-Rated Bonus, as applicable, for each Company fiscal year or portion thereof during the Contract Period, 

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January 1, 2018
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calculated as provided in paragraph 19(e)(iii), provided that the total severance payment you receive pursuant to paragraphs 11(c)(i) and (ii) shall in no event exceed two times the sum of your Salary and Target Bonus in the year in which such termination occurs;
		
	(iii)
	Provided you validly elect continuation of your medical and dental coverage under Section 4980B(f) of the Internal Revenue Code of 1986 (the “Code”) (relating to coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”)), your coverage and participation under the Company’s medical and dental benefit plans and programs in which you were participating immediately prior to your termination of employment pursuant to this paragraph 11, shall continue at no cost to you (except as set forth below) until the earlier of (i) the end of the Contract Period, but in no event less than twelve (12) months after the termination of your employment, or (ii) the date on which you become eligible for medical and/or dental coverage from another employer; provided, that, during the period that the Company provides you with this coverage, an amount equal to the total applicable COBRA cost (or such other amounts as may be required by law) will be included in your income for tax purposes and the Company may withhold taxes from your termination payments for this purpose; and provided, further, that you may elect to continue your medical and dental coverage under COBRA at your own expense for the balance, if any, of the period required by law; 

		
	(iv)
	The Company shall continue to provide you with $5 million life insurance coverage, at no premium cost to you (unless you had no coverage at the time of termination), until the end of the Contract Period or, if longer, the end of the period in which you are receiving payments pursuant to paragraph 11(c)(i), in accordance with the Company’s then-current policy, as may be amended from time to time.  Such coverage shall end in the event you are eligible to obtain life insurance coverage from another employer; 

		
	(v)
	All stock options granted to you under any Viacom Inc. long-term incentive plan that have not vested as of the date of your termination of employment, but that would have vested on or before the end of the Contract Period, shall become fully vested on the date of termination; 

		
	(vi)
	All restricted share units granted to you under any Viacom Inc. long-term incentive plan that have not vested as of the date of your termination of employment, but that would have vested on or before the end of the Contract Period, shall become fully vested on the date of termination;

		
	(vii)
	There shall be no acceleration of the vesting of any equity or long-term incentive awards granted to you under any Viacom Inc. long-term incentive plan, unless otherwise provided herein or under the terms of the applicable long-term incentive plan; and

		
	(viii)
	The Company shall pay or continue to provide, as applicable, the Accrued Compensation and Benefits.

Mr. Scott Mills
January 1, 2018
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(d)    Release.  Your entitlement to the payments and benefits described in this paragraph 11 is conditioned on your execution and delivery to the Company, within sixty (60) days after your termination of employment (the “Release Deadline”), of a release in substantially the form appended hereto as Appendix A that remains in effect and becomes irrevocable after the expiration of any statutory period in which you are permitted to revoke a release (the “Release”).  If you fail to execute and deliver the Release by the Release Deadline, or if you thereafter effectively revoke the Release, the Company shall be under no obligation to make any further payments or provide any further benefits to you and any payments and benefits previously provided to you pursuant to this paragraph 11 shall not have been earned.  In such event, you shall promptly repay the Company any payments made and the Company’s direct cost for any benefits provided to you pursuant to this paragraph 11.  The limitations of this paragraph shall not apply to the Accrued Compensation and Benefits.
(e)    Offset.  The amount of payments provided in paragraph 11 in respect of the period that begins twelve (12) months after the termination of your employment shall be reduced by any compensation for services earned by you (including as an independent consultant or independent contractor) from any source in respect of the period that begins twelve (12) months after the termination of your employment and ends when the Company is no longer required to make payments pursuant to paragraph 11 (the “Offset Period”), including, without limitation, salary, sign-on or annual bonus, consulting fees, commission payments and any amounts the payment of which is deferred at your election, or with your consent, until after the expiration of the Offset Period; provided that, if the Company in its reasonable discretion determines that any grant of long-term compensation is made in substitution of the aforementioned payments, such payments shall be further reduced by the value on the date of grant, as reasonably determined by the Company, of such long-term compensation you receive.  You agree to promptly notify the Company of any arrangements during the Offset Period in which you earn compensation for services and to cooperate fully with the Company in determining the amount of any such reduction.  
12.    Resignation in Breach of the Agreement.  If you resign prior to the expiration of the Contract Period other than for Good Reason, such resignation is a material breach of this Agreement and, without limitation of other rights or remedies available to the Company, the Company shall have no further obligations to you under this Agreement or otherwise, except to make termination payments provided in paragraph 10(a).
13.    Termination Due to Death.
(a)    Death While Employed.  In the event of your death prior to the end of the Contract Period while actively employed with the Company, this Agreement shall automatically terminate.  Thereafter, your designated beneficiary (or, if there is no such beneficiary, your estate) shall receive (i) any Accrued Compensation and Benefits as of the date of your death and (ii) for the year in which death occurs, any Bonus or Pro-Rated Bonus, as applicable, which you would have been eligible to receive, calculated in accordance with paragraph 19(e)(iii).  In no event shall a distribution be made pursuant to clause (i) in the preceding sentence later than the 60th day following your death and a distribution pursuant to clause (ii) in the preceding sentence shall be made at the same time and in the same manner as if you were still actively employed with the Company.
(b)    Death After the End of Employment.  In the event of your death while you are entitled to receive compensation or benefits under paragraphs 11 or 15, in lieu of such payments your designated beneficiary (or, if there is no such beneficiary, your estate) shall receive, to the extent not previously paid to you, (i) continuation of Salary pursuant to the applicable paragraph through the date of death; (ii) if you were entitled to receive compensation or benefits under paragraph 11, for the year in which death occurs, 

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January 1, 2018
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any Bonus or Pro-Rated Bonus, as applicable, for the year in which death occurs, payable under such paragraph, calculated in accordance with paragraph 19(e)(iii); and (iii) any Accrued Compensation and Benefits.  In no event shall a distribution be made pursuant to clauses (i) and (iii) in the preceding sentence later than the 60th day following your death and a distribution pursuant to clause (ii) in the preceding sentence shall be made at the same time and in the same manner as if you were still actively employed with the Company.
14.    Long-Term Disability.  In the event you are absent due to a LTD and you are receiving compensation under a Viacom LTD plan, then, effective on the date you begin receiving compensation under such plan, (i) this Agreement shall terminate without any further action required by the Company, (ii) you shall be considered an “at-will” employee of the Company, and (iii) you shall have no guarantee of specific future employment nor continuing employment generally when your receipt of compensation under a Viacom LTD plan ends, except as required by applicable law.  In the event of such termination of this Agreement, you shall receive (i) any Accrued Compensation and Benefits and (ii) for the year in which such termination occurs, any Bonus or Pro-Rated Bonus, as applicable, which you would have been entitled to receive, calculated in accordance with paragraph 19(e)(iii).  Except as set forth in the previous sentence, the compensation provided to you under the applicable LTD plan shall be in lieu of any compensation from the Company (including, but not limited to, the Salary provided under this Agreement or otherwise).  Your participation in any other Viacom benefit plans or programs shall be governed by the terms of the applicable plan or program documents, award agreements and certificates.
15.    Non-Renewal.  If the Company does not extend or renew this Agreement at the end of the Contract Period and you have not entered into a new contractual relationship with the Company or Viacom, your continuing employment, if any, with the Company or Viacom shall be “at-will” and may be terminated at any time by either party.  If the Company or Viacom terminates your employment during the twelve (12) month period commencing with the last day of the Contract Period while you are an employee at-will, the Company shall continue to pay your Salary (at the rate in effect on the date of termination) at the same time and in the same manner as if you had not terminated employment for the balance, if any, of such twelve (12) month period; provided, however, that (i) you shall not be entitled to such Salary continuation if the Company terminates your employment for reasons constituting Cause and (ii) any such Salary continuation shall be subject to offset as set forth in paragraph 11(e) above, without giving effect to the twelve (12) month period referenced therein.  
16.    Severance Plan Adjustment.  In the event that your employment with the Company terminates pursuant to paragraph 11 or 15, and, at the time of your termination of employment there is in effect a Viacom severance plan (a “Severance Plan”) for which you would have been eligible to participate but for your having entered into this Agreement or being a Specified Employee and which provides for severance compensation that is greater than the amounts to which you are entitled under paragraphs 11(c)(i) and 11(c)(ii) or paragraph 15, then the amounts, but not the time or form of payment, of your severance compensation under this Agreement shall automatically be adjusted to equal those that would have been provided to you under the Severance Plan.  For the avoidance of doubt, any payment entitlement pursuant to this paragraph 16 is in lieu of, and not in addition to, any severance compensation to which you may otherwise be entitled under this Agreement.  Notwithstanding any adjustment to the amount of your entitlements pursuant to this paragraph 16, all other provisions of this Agreement shall remain in effect, including, without limitation, paragraphs 6, 7, 8 and 9.
17.    Further Events on Termination of Employment. 
(a)    Termination of Benefits.  Except as otherwise expressly provided in this Agreement, your participation in all Viacom benefit plans and programs (including, without limitation, medical and dental 

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January 1, 2018
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coverage, life insurance coverage, vacation accrual, all retirement and the related excess plans, STD and LTD plans and accidental death and dismemberment and business travel and accident insurance and your rights with respect to any outstanding equity compensation awards) shall be governed by the terms of the applicable plan and program documents, award agreements and certificates.  
(b)    Resignation from Official Positions.  If your employment with the Company terminates for any reason, you shall be deemed to have resigned at that time from any and all officer or director positions that you may have held with the Company or Viacom and all board seats or other positions in other entities to which you have been designated by the Company or Viacom or which you have held on behalf of the Company or Viacom.  If, for any reason, this paragraph 17(b) is deemed insufficient to effectuate such resignation, you hereby authorize the Secretary and any Assistant Secretary of Viacom Inc. to execute any documents or instruments which Viacom Inc. may deem necessary or desirable to effectuate such resignation or resignations, and to act as your attorney-in fact.
18.    Survival; Remedies.  
(a)    Survival.  Your obligations under paragraphs 6, 7, 8 and 9 shall remain in full force and effect for the entire period provided therein notwithstanding the termination of your employment for any reason or the expiration of the Contract Period.
(b)    Modification of Terms.  You and the Company acknowledge and agree that the restrictions and remedies contained in paragraphs 6, 7, 8 and 9 are reasonable and that it is your intention and the intention of the Company that such restrictions and remedies shall be enforceable to the fullest extent permissible by law.  If a court of competent jurisdiction shall find that any such restriction or remedy is unenforceable, but would be enforceable if some part were deleted or modified, then such restriction or remedy shall apply with the deletion or modification necessary to make it enforceable and shall in no way affect any other provision of this Agreement or the validity or enforceability of this Agreement.
(c)    Injunctive Relief.  The Company has entered into this Agreement in order to obtain the benefit of your unique skills, talent, and experience.  You acknowledge and agree that any violation of paragraphs 6, 7, 8 and 9 shall result in irreparable damage to the Company, and, accordingly, the Company may obtain injunctive and other equitable relief for any breach or threatened breach of such paragraphs, in addition to any other remedies available to the Company.  To the extent permitted by applicable law, you hereby waive any right to the posting of a bond in connection with any injunction or other equitable relief sought by the Company and you agree not to seek such relief in your opposition to any application for relief the Company shall make.  
(d)    Other Remedies.  In the event that you materially violate the provisions of paragraphs 6, 7, 8 or 9 at any time during the Non-Competition Period or any period in which the Company is making payments to you pursuant to this Agreement, (i) any outstanding stock options or other undistributed equity awards granted to you by the Company shall immediately be forfeited, whether vested or unvested; and (ii) the Company’s obligation to make any further payments or to provide benefits (other than Accrued Compensation and Benefits) to you pursuant to this Agreement shall terminate.  The Company shall give you written notice prior to commencing any remedy under this paragraph 18(d) or, if no cure period is applicable, contemporaneous with such commencement, setting forth the nature of any alleged violation in reasonable detail and the conduct required to cure such violation.  Except for a violation which, by its nature, cannot reasonably be expected to be cured, you shall have ten (10) business days from the giving of such notice within which to cure; provided, however, that, if the Company reasonably expects irreparable injury from a delay of ten (10) business days, the Company may give you notice of 

Mr. Scott Mills
January 1, 2018
Page 12

such shorter period within which to cure as is reasonable under the circumstances, which may include commencement of a remedy without notice and with immediate effect.  The remedies under this paragraph 18 are in addition to any other remedies the Company may have against you, including under this Agreement or any other agreement, under any equity or other incentive or compensation plan or under applicable law.  
19.    General Provisions.
(a)    Deductions and Withholdings.  In the event of the termination of your employment for any reason, the Company reserves the right, to the extent permitted by law and in addition to any other remedy the Company may have, to deduct from any monies that are otherwise payable to you and that do not constitute deferred compensation within the meaning of Section 409A of the Code, the regulations promulgated thereunder or any related guidance issued by the U.S. Treasury Department (“Section 409A”) all monies and the replacement value of any property you may owe to the Company at the time of or subsequent to the termination of your employment with the Company.  The Company shall not make any such deduction from any amount that constitutes deferred compensation for purposes of Section 409A.  To the extent any law requires an employee’s consent to the offset provided in this paragraph and permits such consent to be obtained in advance, this Agreement shall be deemed to provide the required consent.  Except as otherwise expressly provided in this Agreement or in any Company benefit plan, all amounts payable under this Agreement shall be paid in accordance with the Company’s ordinary payroll practices less deductions and income and payroll tax withholding as may be required under applicable law.  Any property (including shares of Viacom Inc. Class B Common Stock), benefits and perquisites provided to you under this Agreement, including, without limitation, COBRA payments made on your behalf, shall be taxable to you as provided by law.
(b)    Cash and Equity Awards Modifications.  Notwithstanding any other provisions of this Agreement to the contrary, the Company reserves the right to modify or amend unilaterally the terms and conditions of your cash compensation, stock option awards or other equity awards, without first asking your consent, to the extent that the Company considers such modification or amendment necessary or advisable to comply with any law, regulation, ruling, judicial decision, accounting standard, regulatory guidance or other legal requirement (the “Legal Requirement”) applicable to such cash compensation, stock option awards or other equity awards, provided that, except where necessary to comply with law, such amendment does not have a material adverse effect on the value of such compensation award to you.  In addition, the Company may, without your consent, amend or modify your cash compensation, stock option awards or other equity awards in any manner that the Company considers necessary or advisable to ensure that such cash compensation, stock option awards or other equity awards are not subject to United States federal income tax, state or local income tax or any equivalent taxes in territories outside the United States prior to payment, exercise, vesting or settlement, as applicable, or any tax, interest or penalties pursuant to Section 409A.
(c)     Section 409A Provisions.  
		
	(i)
	The Company may, without your consent, amend any provision of this Agreement to the extent that, in the reasonable judgment of the Company, such amendment is necessary or advisable to avoid the imposition on you of any tax, interest or penalties pursuant to Section 409A or otherwise to make this Agreement enforceable.  Any such amendment shall maintain, to the maximum extent practicable, the original intent and economic benefit to you of the applicable provision.

Mr. Scott Mills
January 1, 2018
Page 13

		
	(ii)
	It is the intention and understanding of the parties that all amounts and benefits to which you become entitled under this Agreement will be paid or provided to you pursuant to a fixed schedule within the meaning of Section 409A.  Notwithstanding such intention and understanding, in the event that you are a specified employee as determined by Viacom Inc. (a “Specified Employee”) at the time of your Separation from Service (as defined below), then to the extent that any amount or benefit owed to you under this Agreement (x) constitutes an amount of deferred compensation for purposes of Section 409A and (y) is considered for purposes of Section 409A to be owed to you by virtue of your Separation from Service, then such amount or benefit shall not be paid or provided during the six (6) month period following the date of your Separation from Service and instead shall be paid or provided on the first day of the seventh month following your date of Separation from Service; provided, however, that such delay shall apply only to the extent that such payments and benefits, in the aggregate, exceed the lesser of an amount equal to (x) two (2) times your annualized compensation (as determined under the Code Section 409A regulations) and (y) two (2) times the applicable Code Section 401(a)(17) annual compensation limit for the year in which your termination occurs; provided, further, that any payments made during such six (6) month period shall first be made to cover all costs relating to medical, dental and life insurance coverage to which you are entitled under this Agreement and thereafter shall be made in respect of other amounts or benefits owed to you.

		
	(iii)
	As used herein, “Separation from Service” shall mean either (i) the termination of your employment with the Company and its affiliates, provided that such termination of employment meets the requirements of a separation of service determined using the default provisions set forth in Treasury Regulation §1.409A-(1)(h) or the successor provision thereto or (ii) such other date that constitutes a separation from service with the Company and its affiliates meeting the requirements of the default provisions set forth in Treasury Regulation §1.409A-(1)(h) or the successor provision thereto.  For purposes of this definition, "affiliate" means any corporation that is in the same controlled group of corporations (within the meaning of Code Section 414(b)) as the Company and any trade or business that is under common control with the Company (within the meaning of Code Section 414(c)), determined in accordance with the default provision set forth in Treasury Regulation §1.409A-(1)(h)(3).

		
	(iv)
	If under any provision of this Agreement you become entitled to be paid Salary continuation, then each payment of Salary during the relevant continuation period shall be considered, and is hereby designated as, a separate payment for purposes of Section 409A (and consequently your entitlement to such Salary continuation shall not be considered an entitlement to a single payment of the aggregate amount to be paid during the relevant continuation period).

(d)    No Duplicative Payments.  The payments and benefits provided in this Agreement in respect to the termination of employment and non-renewal of this Agreement are in lieu of any other salary, bonus or benefits payable by the Company, including, without limitation, any severance or income continuation or protection under any Viacom plan that may now or hereafter exist.  All such payments and benefits shall constitute liquidated damages, paid in full and final settlement of all obligations of Viacom to you under this Agreement.  

Mr. Scott Mills
January 1, 2018
Page 14

(e)    Payment of Bonus Compensation.  
		
	(i)
	The Bonus for any Company fiscal year under this Agreement shall be paid by March 15th of the following year.  

		
	(ii)
	Except as otherwise expressly provided in this Agreement, your Bonus shall be prorated (A) to apply only to that part of the Company’s fiscal year which falls within the Contract Period and (B) to the extent the Company's fiscal year is less than a 12-month fiscal year (a “Pro-Rated Bonus”).  Following expiration of the Contract Period, you shall receive a Pro-Rated Bonus for the period of the Company’s fiscal year which falls within the Contract Period only (A) in the event that the Company terminates your employment without Cause prior to the date on which employees of the Company become entitled to Bonus under the STIP, (B) as provided in paragraph 11(c)(ii) or (C) as provided in the STIP.

		
	(iii)
	Any Bonus or Pro-Rated Bonus payable pursuant to paragraphs 11, 13 or 14 shall be paid at the lesser of (X) your Target Bonus amount or (Y) your Target Bonus amount, adjusted based on the Company Performance Factor for the relevant year.

(f)    Parachute Payment Adjustments.  Notwithstanding anything herein to the contrary, in the event that you receive any payments or distributions, whether payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, that constitute “parachute payments” within the meaning of Section 280G of the Code, and the net after‐tax amount of the parachute payment is less than the net after-tax amount if the aggregate payment to be made to you were three times your “base amount” (as defined in Section 280G(b)(3) of the Code) less $1.00, then the aggregate of the amounts constituting the parachute payment shall be reduced to an amount that shall equal three times  your  base amount, less $1.00.  The determinations to be made with respect to this paragraph 19(f) shall be made by a certified public accounting firm designated by the Company and reasonably acceptable to you.
(g)    Adjustments to Bonuses and Long-Term Incentive Compensation.  Notwithstanding anything herein to the contrary, the Company shall be entitled to adjust the amount of any Bonus or any award of long-term incentive compensation if the financial statements of Viacom or the business unit on which the calculation or determination of the Bonus or award of long-term incentive compensation were based are subsequently restated and, in the judgment of the Company, the financial statements as so restated would have resulted in a smaller Bonus or long-term incentive compensation award if such information had been known at the time the Bonus or award had originally been calculated or determined.  In addition, in the event of such a restatement: (i) the Company may require you, and you agree, to repay to the Company the amount by which the Bonus as originally calculated or determined exceeds the Bonus as adjusted pursuant to the preceding sentence; and (ii) the Company may cancel, without any payment therefor, the portion of any award of long-term incentive compensation that exceeds the award adjusted pursuant to the preceding sentence (or, if such portion of an award cannot be canceled because (x) in the case of stock options or other similar awards, you have previously exercised it, the Company may require you, and you agree, to repay to the Company the amount, net of any exercise price, that you realized upon exercise or (y) in the case of restricted share units or other similar awards, shares of Class B Common Stock were delivered to you in settlement of such award, the Company may require you, and you agree to return the shares of Class B Common Stock, or if such shares were sold by you, return any proceeds realized on the sale of such shares).

Mr. Scott Mills
January 1, 2018
Page 15

(h)    Mediation.  Prior to the commencement of any legal proceeding relating to your employment, you and the Company agree to attempt to mediate the dispute using a professional mediator from JAMS, The Resolution Experts (“JAMS”) or the International Institute for Conflict Prevention and Resolution (“CPR”).  Within a period of 30 days after a written request for mediation by either you or the Company, the parties agree to convene with the mediator, for at least one session to attempt to resolve the matter.  In no event will mediation delay commencement of any legal proceeding for more than 30 days absent agreement of the parties or prevent a bona fide application by either party to a court of competent jurisdiction for emergency relief.   The fees of the mediator and of the JAMS or CPR, as the case may be, shall be borne by the Company. 
20.    Additional Representations and Acknowledgments. 
(a)    No Acceptance of Payments.  You represent that you have not accepted or given nor shall you accept or give, directly or indirectly, any money, services or other valuable consideration from or to anyone other than the Company or Viacom for the inclusion of any matter as part of any film, television, internet or other programming produced, distributed and/or developed by Viacom.
(b)    Viacom Policies.  You recognize that the Company is an equal opportunity employer.  You agree that you shall comply with the Company’s employment practices and policies, as they may be amended from time to time, and with all applicable federal, state and local laws prohibiting discrimination on any basis.  In addition, you agree that you shall comply with the Viacom Business Practices Statement and Viacom’s other policies and procedures, as they may be amended from time to time, and provide the certifications and conflict of interest disclosures required by the Viacom Business Practices Statement.  
21.    Notices.  Notices under this Agreement must be given in writing, by personal delivery, regular mail or receipted email, at the parties’ respective addresses shown on this Agreement (or any other address designated in writing by either party), with a copy, in the case of the Company, to the attention of Viacom Inc.’s General Counsel.  Any notice given by regular mail shall be deemed to have been given three (3) days following such mailing.  
22.    Binding Effect; Assignment.  This Agreement and rights and obligations of the Company hereunder shall not be assigned by the Company, provided that the Company may assign this Agreement to any subsidiary or affiliated company of or any successor in interest to the Company provided that such assignee assumes all of the obligations of the Company and Viacom hereunder.  This Agreement is for the performance of personal services by you and may not be assigned by you, except that the rights specified in Section 13 shall pass upon your death to your designated beneficiary (or, if there is no such beneficiary, your estate).  
23.    GOVERNING LAW AND FORUM.  You acknowledge that this agreement has been executed, in whole or in part, in New York.  Accordingly, you agree that this Agreement and all matters or issues arising out of or relating to your employment with the Company shall be governed by the laws of the State of New York applicable to contracts entered into and performed entirely therein.  Any action to enforce or otherwise relating to this Agreement and the rights and obligations hereunder shall be brought solely in the state or federal courts located in the City of New York, Borough of Manhattan.  
24.    No Implied Contract.  Nothing contained in this Agreement shall be construed to impose any obligation on the Company or you to renew this Agreement or any portion hereof or on the Company to establish or maintain any benefit, welfare or compensation plan or program or to prevent the modification or termination of any benefit, welfare or compensation plan or program or any action or 

Mr. Scott Mills
January 1, 2018
Page 16

inaction with respect to any such benefit, welfare or compensation plan or program.  The parties intend to be bound only upon full execution of a written agreement by both parties and no negotiation, exchange of draft, partial performance or tender of an agreement (including any extension or renewal of this Agreement) executed by one party shall be deemed to imply an agreement or the renewal or extension of any agreement relating to your employment with the Company.  Neither the continuation of employment nor any other conduct shall be deemed to imply a continuing agreement upon the expiration of the Contract Period.  
25.    Severability.  In the event any provision or part of this Agreement is found to be invalid or unenforceable, only that particular provision or part so found, and not the entire Agreement, shall be inoperative.
26.    Entire Understanding. This Agreement contains the entire understanding of the parties hereto relating to the subject matter contained in this Agreement, and, except as otherwise provided herein, can be modified only by a writing signed by both parties.
27.    Supersedes Prior Agreements.  With respect to the period covered by the Contract Period, this Agreement supersedes and cancels all prior agreements relating to your employment with Viacom.
Please confirm your understanding of the Agreement by signing and returning two (2) copies of this Agreement.  This document shall constitute a binding agreement between us only after it also has been executed by the Company and a fully executed copy has been returned to you.

	
					
	 
	Very truly yours,
	 

	 
	 
	 
	 
	 

	 
	BLACK ENTERTAINMENT TELEVISION LLC

	 
	 
	 
	 
	 

	 
	By:
	/s/ Christa A. D’Alimonte
	 

	 
	 
	[Name
	Christa A. D’Alimonte
	 

	 
	 
	 Title]
	Executive Vice President
and Secretary
	 

	
		
	ACCEPTED AND AGREED:

	 

	 

	/s/ Scott Mills

	Scott Mills

	 

	Dated:
	12/14/17

Appendix A
Mr. Scott Mills
c/o Black Entertainment Television LLC
1515 Broadway
New York, NY 10036

This General Release of all Claims (this “Agreement”) is entered into by Scott Mills (the “Executive”) and Black Entertainment Television LLC (the “Company”), effective as of _____________________.
In consideration of the promises set forth in the letter agreement between the Executive and the Company, dated January 1, 2018 (the “Employment Agreement”), the Executive and the Company agree as follows:
1.    Return of Property.  All Company files, access keys and codes, desk keys, ID badges, computers, records, manuals, electronic devices, computer programs, papers, electronically stored information or documents, telephones and credit cards, and any other property of the Company in the Executive’s possession must be returned no later than the date of the Executive’s termination from the Company.
2.    General Release and Waiver of Claims.
(a)    Release.  In consideration of the payments and benefits provided to the Executive under the Employment Agreement and after consultation with counsel, the Executive and each of the Executive’s respective heirs, executors, administrators, representatives, agents, insurers, successors and assigns (collectively, the “Releasors”) hereby irrevocably and unconditionally release and forever discharge the Company, its subsidiaries and affiliates and each of their respective officers, employees, directors, shareholders and agents (“Releasees”) from any and all claims, actions, causes of action, rights, judgments, obligations, damages, demands, accountings or liabilities of whatever kind or character (collectively, “Claims”), including, without limitation, any Claims under any federal, state, local or foreign law, that the Releasors may have, or in the future may possess, arising out of (i) the Executive’s employment relationship with and service as an employee, officer or director of the Company, Viacom (as defined in the Employment Agreement) or any subsidiaries or affiliated companies and the termination of such relationship or service, and (ii) any event, condition, circumstance or obligation that occurred, existed or arose on or prior to the date hereof and relates to your employment with Viacom; provided, however, that the Executive does not release, discharge or waive any rights to (i) payments and benefits provided under the Employment Agreement that are contingent upon the execution by the Executive of this Agreement or otherwise expressly survive termination thereof and (ii) any indemnification rights the Executive may have in accordance with the Company’s governance instruments or under any director and officer liability insurance maintained by the Company with respect to liabilities arising as a result of the Executive’s service as an officer and employee of the Company.
(b)    Specific Release of ADEA Claims.  In further consideration of the payments and benefits provided to the Executive under the Employment Agreement, the Releasors hereby unconditionally release and forever discharge the Releasees from any and all Claims that the Releasors may have as of the date the Executive signs this Agreement arising under the Federal Age Discrimination in Employment Act of 1967, as amended, including the Older Workers Benefit Protection Act of 1990 (“OWBPA”), and the applicable rules and regulations promulgated thereunder (“ADEA”).  By signing this Agreement, the Executive hereby acknowledges and confirms the following:  (i) the Executive was advised by the Company in connection with his termination to consult with an attorney of his choice prior 

A-1

to signing this Agreement and to have such attorney explain to the Executive the terms of this Agreement, including, without limitation, the terms relating to the Executive’s release of claims arising under ADEA, and the Executive has in fact consulted with an attorney; (ii) the Executive was given a period of not fewer than 21 days to consider the terms of this Agreement and to consult with an attorney of his choosing with respect thereto; (iii) the Executive knowingly and voluntarily accepts the terms of this Agreement; and (iv) the Executive is providing this release and discharge only in exchange for consideration in addition to anything of value to which the Executive is already entitled.  The Executive also understands that he has seven (7) days following the date on which he signs this Agreement within which to revoke the release contained in this paragraph 2(b), by providing the Company a written notice of his revocation of the release and waiver contained in this paragraph 2(b); provided, however, that if the Executive exercises his right to revoke the release contained in this paragraph 2(b), the Executive shall not be entitled to any amounts paid to him under the termination provisions of the Employment Agreement and the Company may reclaim any such amounts paid to him and may terminate any benefits and payments that are subsequently due under the Employment Agreement, except as prohibited by the ADEA and OWBPA.
(c)    No Assignment.  The Executive represents and warrants that he has not assigned any of the Claims being released under this Agreement.  The Company may assign this Agreement, in whole or in part, to any affiliated company or subsidiary of, or any successor in interest to, the Company.  
3.    Proceedings.  The Executive has not filed, and agrees not to initiate or cause to be initiated on his behalf, any complaint, charge, claim or proceeding against the Releasees before any local, state or federal agency, court or other body relating to his employment or the termination of his employment, other than with respect to the obligations of the Company to the Executive under the Employment Agreement (each, individually, a “Proceeding”), and agrees not to participate voluntarily in any Proceeding.  Notwithstanding the foregoing, the prohibitions in this paragraph 3 shall not apply to the Executive’s right to file a charge with the Equal Employment Opportunity Commission (“EEOC”) or similar local or state agency, or participate in an investigation conducted by such agency.  The Executive waives any right he may have to benefit in any manner from any relief (whether monetary or otherwise) (i) arising out of any Proceeding and/or (ii) in connection with any claim pursued by any administrative agency, including but not limited to the EEOC, on the Executive’s behalf and, in the event the Executive is awarded money, compensation or benefits, the Executive shall immediately remit such award to the Company.
4.    Remedies.  In the event the Executive initiates or voluntarily participates in any Proceeding in violation of this Agreement, or if he fails to abide by any of the terms of this Agreement or his post-termination obligations contained in the Employment Agreement, the Company may, in addition to any other remedies it may have, reclaim any amounts paid to him under the termination provisions of the Employment Agreement and terminate any benefits or payments that are subsequently due under the Employment Agreement, except as prohibited by the ADEA and OWBPA, without waiving the release granted herein.  The Executive acknowledges and agrees that the remedy at law available to the Company for breach of any of his post-termination obligations under the Employment Agreement or his obligations under paragraphs 2 and 3 herein would be inadequate and that damages flowing from such a breach may not readily be susceptible to being measured in monetary terms.  Accordingly, the Executive acknowledges, consents and agrees that, in addition to any other rights or remedies that the Company may have at law or in equity or as may otherwise be set forth in the Employment Agreement, the Company shall be entitled to seek a temporary restraining order or a preliminary or permanent injunction, or both, without bond or other security, restraining the Executive from breaching his post-termination obligations under the Employment Agreement or his obligations under paragraphs 2 and 3 herein.  Such injunctive relief in any court shall be available to the Company, in lieu of, or prior to or pending determination in, any arbitration proceeding.

A-2

The Executive understands that by entering into this Agreement he shall be limiting the availability of certain remedies that he may have against the Company and limiting also his ability to pursue certain claims against the Company.
5.    Severability Clause.  In the event any provision or part of this Agreement is found to be invalid or unenforceable, only that particular provision or part so found, and not the entire Agreement, shall be inoperative.
6.    Nonadmission.  Nothing contained in this Agreement shall be deemed or construed as an admission of wrongdoing or liability on the part of the Company.
7.    GOVERNING LAW AND FORUM.  The Executive acknowledges that this Agreement has been executed, in whole or in part, in New York.  Accordingly, the Executive agrees that this Agreement and all matters or issues arising out of or relating to the Executive’s employment with the Company shall be governed by the laws of the State of New York applicable to contracts entered into and performed entirely therein.  Any action to enforce this Agreement shall be brought solely in the state or federal courts located in the City of New York, Borough of Manhattan.  
8.    Notices.  Notices under this Agreement must be given in writing, by personal delivery, regular mail or receipted email, at the parties’ respective addresses shown on this Agreement (or any other address designated in writing by either party), with a copy, in the case of the Company, to the attention of Viacom Inc.’s General Counsel.  Any notice given by regular mail shall be deemed to have been given three (3) days following such mailing.  
THE EXECUTIVE ACKNOWLEDGES THAT HE HAS READ THIS AGREEMENT AND THAT HE FULLY KNOWS, UNDERSTANDS AND APPRECIATES ITS CONTENTS, AND THAT HE HEREBY EXECUTES THE SAME AND MAKES THIS AGREEMENT AND THE RELEASE AND AGREEMENTS PROVIDED FOR HEREIN VOLUNTARILY AND OF HIS OWN FREE WILL.

A-3

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above.
	
					
	 
	BLACK ENTERTAINMENT TELEVISION LLC

	 
	 
	 
	 
	 

	 
	By:
	 
	 

	 
	 
	[Name
	 
	 

	 
	 
	Title]
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	THE EXECUTIVE
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	Scott Mills
	 

	 
	 
	 
	 
	 

	 
	Dated:
	 
	 
	 

A-4

As of January 1, 2018
Scott Mills
c/o Black Entertainment Television LLC
1515 Broadway
New York, NY 10036
Dear Mr. Mills:
Reference is made to that certain employment agreement between you and Black Entertainment Television LLC (the “Company”) dated as of January 1, 2018 (your “Employment Agreement”).  All defined terms used without definitions shall have the meanings provided in your Employment Agreement.
This letter is to confirm our understanding, notwithstanding any provision in your Employment Agreement, that your 2018 fiscal year STIP Bonus, before the application of an Individual Performance Multiplier, shall be the greater of:  (1) the Bonus you would have received had you remained in your previous position of Executive Vice President, Chief Administrative Officer, Viacom Inc., before the application of an Individual Performance Multiplier, equal to your target bonus amount as of December 31, 2017 multiplied by the 2018 Company Performance Multiplier applied to Viacom Corporate Executive Vice Presidents, or (2) the Bonus you would receive, before the application of an Individual Performance Multiplier, by adding the following:  (a) three-twelfths times your target bonus amount as of December 31, 2017 multiplied by the 2018 Company Performance Factor applied to Viacom Corporate Executive Vice Presidents, and (b) nine-twelfths times your target bonus amount as of August 1, 2018 multiplied by the 2018 Company Performance Multiplier applied to BET Networks senior executives.
Please confirm your understanding of the Agreement by signing and returning the two (2) copies of this letter.  This document shall constitute a binding agreement between us only after it also has been executed by the Company and a fully executed copy has been returned to you.
	
					
	 
	Very truly yours,
	 

	 
	 
	 
	 
	 

	 
	BLACK ENTERTAINMENT TELEVISION LLC
	 

	 
	 
	 
	 
	 

	 
	By:
	/s/ Christa A. D’Alimonte
	 

	 
	 
	Christa D’Alimonte
Executive Vice President & Secretary
	 

	
		
	ACCEPTED AND AGREED:

	 

	 

	/s/ Scott Mills

	Scott Mills

	 

	Dated:
	12/14/17

BET NETWORKS   |  1540 BROADWAY, 27TH FLOOR  |   NEW YORK, NY  10036   |   TEL: 212.205.3000grub-ex101_34.htm

Exhibit 10.1

 

 

INVESTMENT AGREEMENT

by and between

GRUBHUB INC.

and

YUM RESTAURANT SERVICES GROUP, LLC

Dated as of February 7, 2018

 

 

 

 

KE 51481656

 

						
						
	
TABLE OF CONTENTS

 

	
 
	
 
	
 
	
 
	
 
	
PAGE

	
Article I
	
 
	
Definitions
	
1

	
 
	
Section 1.01
	
 
	
Definitions
	
1

	
Article II
	
 
	
Purchase and Sale
	
7

	
 
	
Section 2.01
	
 
	
Purchase and Sale
	
7

	
 
	
Section 2.02
	
 
	
Closing
	
7

	
Article III
	
 
	
Representations and Warranties of the Company
	
8

	
 
	
Section 3.01
	
 
	
Organization; Standing
	
8

	
 
	
Section 3.02
	
 
	
Capitalization
	
8

	
 
	
Section 3.03
	
 
	
Authority; Noncontravention
	
9

	
 
	
Section 3.04
	
 
	
Governmental Approvals
	
10

	
 
	
Section 3.05
	
 
	
Absence of Certain Changes
	
10

	
 
	
Section 3.06
	
 
	
Brokers and Other Advisors
	
10

	
 
	
Section 3.07
	
 
	
Sale of Securities
	
10

	
 
	
Section 3.08
	
 
	
Listing and Maintenance Requirements
	
10

	
 
	
Section 3.09
	
 
	
Filed SEC Documents
	
11

	
 
	
Section 3.10
	
 
	
No Other Company Representations or Warranties
	
11

	
 
	
Section 3.11
	
 
	
No Other Purchaser Representations or Warranties
	
11

	
Article IV
	
 
	
Representations and Warranties of the Purchaser
	
11

	
 
	
Section 4.01
	
 
	
Organization; Standing
	
11

	
 
	
Section 4.02
	
 
	
Authority; Noncontravention
	
12

	
 
	
Section 4.03
	
 
	
Governmental Approvals
	
12

	
 
	
Section 4.04
	
 
	
Sufficient Funds
	
12

	
 
	
Section 4.05
	
 
	
Ownership of Company Stock
	
12

	
 
	
Section 4.06
	
 
	
Brokers and Other Advisors
	
13

	
 
	
Section 4.07
	
 
	
Purchase for Investment
	
13

	
 
	
Section 4.08
	
 
	
No Other Purchaser Representations or Warranties
	
13

	
 
	
Section 4.09
	
 
	
No Other Company Representations or Warranties
	
13

	
Article V
	
 
	
Additional Agreements
	
14

	
 
	
Section 5.01
	
 
	
Reasonable Best Efforts; Filings
	
14

	
 
	
Section 5.02
	
 
	
Public Disclosure
	
15

	
 
	
Section 5.03
	
 
	
NYSE Listing of Shares
	
15

	
 
	
Section 5.04
	
 
	
Standstill
	
15

	
 
	
Section 5.05
	
 
	
Transfer Restrictions
	
19

	
 
	
Section 5.06
	
 
	
Legend
	
20

	
 
	
Section 5.07
	
 
	
Election of Directors
	
21

	
 
	
Section 5.08
	
 
	
Voting
	
23

	
 
	
Section 5.09
	
 
	
Tax Matters
	
24

i

KE 51481656

 

	
Article VI
	
 
	
Conditions to Closing
	
24

	
 
	
Section 6.01
	
 
	
Conditions to the Obligations of the Company and the Purchaser
	
24

	
 
	
Section 6.02
	
 
	
Conditions to the Obligations of the Company
	
25

	
 
	
Section 6.03
	
 
	
Conditions to the Obligations of the Purchaser
	
25

	
Article VII
	
 
	
Termination; Survival
	
26

	
 
	
Section 7.01
	
 
	
Termination
	
26

	
 
	
Section 7.02
	
 
	
Effect of Termination
	
27

	
 
	
Section 7.03
	
 
	
Survival
	
27

	
Article VIII
	
 
	
Miscellaneous
	
27

	
 
	
Section 8.01
	
 
	
Amendments; Waivers
	
27

	
 
	
Section 8.02
	
 
	
Extension of Time, Waiver, Etc
	
28

	
 
	
Section 8.03
	
 
	
Assignment
	
28

	
 
	
Section 8.04
	
 
	
Counterparts
	
28

	
 
	
Section 8.05
	
 
	
Entire Agreement; No Third-Party Beneficiaries; No Recourse
	
28

	
 
	
Section 8.06
	
 
	
Governing Law; Jurisdiction
	
28

	
 
	
Section 8.07
	
 
	
Specific Enforcement
	
29

	
 
	
Section 8.08
	
 
	
WAIVER OF JURY TRIAL
	
29

	
 
	
Section 8.09
	
 
	
Notices
	
30

	
 
	
Section 8.10
	
 
	
Severability
	
31

	
 
	
Section 8.11
	
 
	
Expenses
	
31

	
 
	
Section 8.12
	
 
	
Interpretation
	
31

	
 
	
Section 8.13
	
 
	
Acknowledgment of Securities Laws
	
32

 

 

 

ANNEXES

Annex I – Form of Press Release
Annex II – Form of Resignation Letter

 

 

 

ii

KE 51481656

 

 

INVESTMENT AGREEMENT, dated as of February 7, 2018 (this “Agreement”), by and between GRUBHUB INC., a Delaware corporation (the “Company”), and YUM RESTAURANT SERVICES GROUP, LLC, a Delaware limited liability company (the “Purchaser”).

WHEREAS, a subsidiary of the Company and certain Affiliates (as defined below) of the Purchaser are entering into the MSA (as defined below) contemporaneously with entering into this Agreement; and

WHEREAS, the Company desires to issue, sell and deliver to the Purchaser, and the Purchaser desires to purchase and acquire from the Company, pursuant to the terms and conditions set forth in this Agreement, an aggregate of 2,820,464 shares of the Company’s Common Stock, par value $0.0001 per share (the “Common Stock”).

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements contained in this Agreement, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:

Article I

Definitions

Section 1.01Definitions

.  (a)  As used in this Agreement (including the recitals hereto), the following terms shall have the following meanings:

“5% Entity” means any Person that, after giving effect to a proposed Transfer, would beneficially own greater than 5% of the then outstanding Common Stock.

Any Person shall be deemed to “beneficially own”, to have “beneficial ownership” of, or to be “beneficially owning” any securities (which securities shall also be deemed “beneficially owned” by such Person) that such Person is deemed to “beneficially own” within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act; provided that any Person shall be deemed to beneficially own any securities that such Person has the right to acquire, whether or not such right is exercisable immediately.  

“50% Beneficial Ownership Requirement” means that the Purchaser Parties continue to beneficially own at all times at least 1,410,232 shares of Common Stock, which number of shares shall be proportionately adjusted in the event of any stock split or reverse stock split of the Common Stock occurring after the Closing.

“Affiliate” means, as to any Person, any other Person that, directly or indirectly, controls, or is controlled by, or is under common control with, such Person; provided, however, that the Company and its Subsidiaries shall not be deemed to be Affiliates of any Purchaser Party or any of their respective Affiliates. For this purpose, “control” (including, with its correlative meanings, “controlled by” and “under common 

 

KE 51481656

 

 

control with”) shall mean the possession, directly or indirectly, of the power to direct or cause the direction of management or policies of a Person, whether through the ownership of securities or partnership or other ownership interests, by contract or otherwise.

“Board” means the Board of Directors of the Company.

“Bona Fide Acquiror” means a Person or group making a Third Party Proposal that is reasonably capable of consummating such Third Party Proposal, taking into account all legal, financial, regulatory and other aspects of such Third Party Proposal, including the identity of the Person or group making such Third Party Proposal.

“Business Day” means any day except a Saturday, a Sunday or other day on which the SEC or banks in the City of New York are authorized or required by Law to be closed.

	

	
“Change of Control” means, with respect to a Person, directly or indirectly (a) a consolidation, merger or similar business combination involving such Person in which the holders of voting securities of such Person immediately prior thereto are not the holders of a majority in interest of the voting securities of the surviving Person in such transaction, (b) a sale, lease or conveyance of all or substantially all of the consolidated assets, or of 50% or more of the outstanding voting securities, of such Person in one transaction or a series of related transactions or (c) any Person or group becomes the beneficial owner of (i) 50% or more of the outstanding voting securities of such Person or (ii) 35% or more of the outstanding voting securities of such Person and, in the case of this clause (ii), within two years thereof, a majority of the members of the board of directors of such Person, as a result of actions taken by such beneficial owner (other than voting its voting securities in favor of any matter submitted to the Company’s stockholders, and recommended, in each case, by the Board), cease to be individuals who were members of the board of directors of such Person immediately prior to such other Person or group acquiring such beneficial ownership.

“Common Stock” means the common stock, par value $0.0001 per share, of the Company.

“Company Charter Documents” means the Company’s certificate of incorporation and bylaws, each as amended or restated from time to time.

“Company Plan” means each plan, program, policy, agreement or other arrangement covering current or former employees, directors or consultants, that is (i) an employee welfare plan within the meaning of Section 3(1) of ERISA, (ii) an employee pension benefit plan within the meaning of Section 3(2) of ERISA, other than any plan which is a “multiemployer plan” (as defined in Section 4001(a)(3) of ERISA), (iii) a stock option, stock purchase, stock appreciation right or other stock-based agreement, program or plan, (iv) an individual employment, consulting, severance, retention or other similar agreement or (v) a bonus, incentive, deferred compensation, profit-sharing, retirement, post-retirement, vacation, severance or termination pay, benefit or fringe-

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benefit plan, program, policy, agreement or other arrangement, in each case that is sponsored, maintained or contributed to by the Company or any of its Subsidiaries or to which the Company or any of its Subsidiaries contributes or is obligated to contribute to or has or may have any liability, other than any plan, program, policy, agreement or arrangement sponsored and administered by a Governmental Authority.

“Company Restricted Share” means a share of Common Stock that is subject to forfeiture conditions.

“Company RSU” means a restricted stock unit of the Company subject solely to time-based vesting conditions.

“Company Stock Option” means an option to purchase shares of Common Stock.

“DGCL” means the Delaware General Corporation Law, as amended, supplemented or restated from time to time.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

“Fall-Away of Purchaser Board Rights” means the earliest of (1) the first day on which the 50% Beneficial Ownership Requirement is not satisfied, (2) the termination of the Master Services Agreement (the “MSA”) among Grubhub Holdings Inc., Yum Restaurant Services Group, LLC, Taco Bell Corp., KFC Corporation and Pizza Hut, LLC, dated as of the date hereof, as it may be amended in accordance with its terms and (3) the investment by Purchaser Parent or any of its Subsidiaries in a Prohibited Transferee, other than an investment in a money market fund, mutual fund, index fund or similar investment fund that holds investments in Prohibited Transferees.

“GAAP” means generally accepted accounting principles in the United States, consistently applied.

“Governmental Authority” means any government, court, regulatory or administrative agency, commission, arbitrator or authority or other legislative, executive or judicial governmental entity (in each case including any self-regulatory organization), whether federal, state or local, domestic, foreign or multinational.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder.

“Judgments” means any outstanding order, judgment, injunction, ruling, writ or decree of any Governmental Authority.

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“Laws” means all state or federal laws, common law, statutes, ordinances, codes, rules or regulations or other similar requirement enacted, adopted, promulgated, or applied by any Governmental Authority.

“Liens” means any mortgage, pledge, lien, charge, encumbrance, security interest or other restriction of any kind or nature, whether based on common law, statute or contract.

“Material Adverse Effect” means any effect, change, event or occurrence that has or would reasonably be expected to have, individually or in the aggregate, a material adverse effect on (a) the business, results of operations, assets or financial condition of the Company and its Subsidiaries, taken as a whole, or (b) the ability of the Company to consummate the Transactions on a timely basis; provided, however, that solely with respect to the foregoing clause (a), none of the following, and no effect, change, event or occurrence arising out of, or resulting from, the following, shall constitute or be taken into account in determining whether a Material Adverse Effect has occurred or would reasonably be expected to occur:  any effect, change, event or occurrence (A) generally affecting (1) the industry in which the Company and its Subsidiaries operate or (2) the economy, credit or financial or capital markets, in the United States or elsewhere in the world, including changes in interest or exchange rates, or (B) to the extent arising out of, resulting from or attributable to (1) changes or prospective changes in Law or in GAAP or in accounting standards, or any changes or prospective changes in the interpretation or enforcement of any of the foregoing, or any changes or prospective changes in general legal, regulatory or political conditions, (2) the execution or announcement of this Agreement or the consummation of the Transactions, including the impact thereof on relationships, contractual or otherwise, with customers, suppliers, distributors, partners, employees or regulators, or any claims or litigation arising from allegations of breach of fiduciary duty or violation of Law relating to this Agreement or the Transactions, (3) acts of war (whether or not declared), sabotage or terrorism, or any escalation or worsening of any such acts of war (whether or not declared), sabotage or terrorism, (4) volcanoes, tsunamis, pandemics, earthquakes, hurricanes, tornados or other natural disasters, (5) any action taken by the Company or its Subsidiaries that is expressly required by this Agreement or with the Purchaser’s express written consent or at the Purchaser’s express written request, (6) any change resulting or arising from the identity of, or any facts or circumstances relating to, the Purchaser or any of its Affiliates, (7) any change or prospective change in the Company’s credit ratings, (8) any decline in the market price, or change in trading volume, of the capital stock of the Company or (9) any failure to meet any internal or public projections, forecasts, guidance, estimates, milestones, budgets or internal or published financial or operating predictions of revenue, earnings, cash flow or cash position (it being understood that the exceptions in clauses (7), (8) and (9) shall not prevent or otherwise affect a determination that the underlying cause of any such change, decline or failure referred to therein (if not otherwise falling within any of the exceptions provided by clause (A) and clauses (B)(1) through (9) hereof) is a Material Adverse Effect), except, solely in the case of clauses (A), (B)(1), (B)(3) and (B)(4), to the extent those effects, changes, events or occurrences have a disproportionate effect on the Company and its Subsidiaries, taken as a whole, as compared to other companies operating in the industry in which the Company and its 

4

 

 

 

Subsidiaries operate (in which case only the disproportionate impact or impacts may be taken into account in determining whether there has been, or would reasonably be expected to be, a Material Adverse Effect).

“NYSE” means the New York Stock Exchange. 

“Permitted Transferee” means, with respect to any Person, (i) any Affiliate of such Person and (ii) any successor entity of such Person.

“Person” means an individual, corporation, limited liability company, partnership, joint venture, association, trust, unincorporated organization or any other entity, including a Governmental Authority.

“Prohibited Transferee” means the list of competitors set forth on a letter dated the date hereof from the Company to the Purchaser as a “Prohibited Transferee” and the Persons that are known by the Purchaser to be Affiliates thereof, which list may be updated by the Company from time to time following the date hereof to add additional Persons that are competitors of the Company with the consent of the Purchaser, not to be unreasonably withheld.

“Purchaser Competitor” means the list of competitors set forth on a letter dated the date hereof from the Purchaser to the Company as a “Purchaser Competitor” and the Persons that are known by the Company to be Affiliates thereof, which list may be updated by the Purchaser from time to time following the date hereof to add additional Persons that are competitors of the Purchaser with the consent of the Company, not to be unreasonably withheld.

“Purchaser Designee” means an individual designated in writing by the Purchaser and reasonably acceptable to the Board (and the Nominating and Corporate Governance Committee of the Board) to be appointed, elected or nominated by the Company for election to the Board pursuant to Section 5.07(a), Section 5.07(c) or Section 5.07(d), as applicable.

“Purchaser Director” means a member of the Board who was elected to the Board as a Purchaser Designee. 

“Purchaser Material Adverse Effect” means any effect, change, event or occurrence that would prevent or materially delay, interfere with, hinder or impair (i) the consummation by the Purchaser of any of the Transactions on a timely basis or (ii) the compliance by the Purchaser with its obligations under this Agreement.

“Purchaser Parent” means Yum! Brands, Inc., a North Carolina corporation (or any successor or parent entity thereof).

“Purchaser Parties” means the Purchaser and each Permitted Transferee of the Purchaser to whom shares of Common Stock are transferred pursuant to Section 5.05(b)(i).

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“Representatives” means, with respect to any Person, its officers, directors, principals, partners, managers, members, employees, consultants, agents, financial advisors, investment bankers, attorneys, accountants, other advisors and other representatives.

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“Subsidiary”, when used with respect to any Person, means any corporation, limited liability company, partnership, association, trust or other entity of which (x) securities or other ownership interests representing more than 50% of the ordinary voting power (or, in the case of a partnership, more than 50% of the general partnership interests) or (y) sufficient voting rights to elect at least a majority of the board of directors or other governing body are owned by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person.

“Transactions” means the Purchase and the other transactions expressly contemplated by this Agreement.

“Transfer” by any Person means, directly or indirectly, to sell, transfer, assign, pledge, encumber, hypothecate or otherwise dispose of or transfer (by the operation of law or otherwise), either voluntarily or involuntarily, or to enter into any contract, option or other arrangement, agreement or understanding with respect to the sale, transfer, assignment, pledge, encumbrance, hypothecation or other disposition or transfer (by the operation of law or otherwise), of any interest in any equity securities beneficially owned by such Person; provided, however, that, notwithstanding anything to the contrary in this Agreement, a Transfer shall not include the redemption or other acquisition of Common Stock by the Company or any Subsidiary of the Company or, so long as not effected for the purpose of circumventing the transfer restrictions hereof, any transfer of common stock or other securities of Purchaser Parent.

(b)In addition to the terms defined in Section 1.01(a), the following terms have the meanings assigned thereto in the Sections set forth below:

	
Term
	
Section

	
Acquired Shares
	
2.01

	
Action
	
5.01

	
Agreement
	
Preamble

	
Announcement
	
5.02

	
Bankruptcy and Equity Exception
	
3.03(a)

	
Capitalization Date
	
3.02(a)

	
Closing
	
2.02(a)

	
Closing Date
	
2.02(a)

	
Company
	
Preamble

6

 

 

 

	
Company Preferred Stock
	
3.02(a)

	
Company Securities
	
3.02(b)

	
Contract
	
3.03(b)

	
DOJ
	
5.01(c)

	
Filed SEC Documents
	
Article III

	
FTC
	
5.01(c)

	
Hedge
	
5.05(a)

	
HSR Form
	
5.01(b)

	
Initial Purchaser Director Designee
	
5.07(a)

	
IRS
	
5.09(a)

	
Purchase
	
2.01

	
Purchase Price
	
2.01

	
Purchaser
	
Preamble

	
Restraints
	
6.01(a)

	
Standstill Expiration Date
	
5.04(a)

	
Termination Date
	
7.01(b)

	
Third Party Proposal
	
5.04(c)

 

Article II

Purchase and Sale

Section 2.01Purchase and Sale

.  On the terms of this Agreement and subject to the satisfaction (or, to the extent permitted by applicable Law, waiver by the party entitled to the benefit thereof) of the conditions set forth in Article VI, at the Closing, the Purchaser shall purchase and acquire from the Company, and the Company shall issue, sell and deliver to the Purchaser, 2,820,464 shares of Common Stock (the “Acquired Shares”), for a purchase price per Acquired Share equal to $70.9103 and an aggregate purchase price of $200,000,000 (such aggregate purchase price, the “Purchase Price”).  The purchase and sale of the Acquired Shares pursuant to this Section 2.01 is referred to as the “Purchase.”

Section 2.02Closing

.  (a)  On the terms of this Agreement, the closing of the Purchase (the “Closing”) shall occur at 10:00 a.m. (New York City time) on the first Business Day after all of the conditions to the Closing set forth in Article VI have been satisfied or, to the extent permitted by applicable Law, waived by the party entitled to the benefit thereof (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of those conditions at such time) at the offices of Kirkland & Ellis LLP, 601 Lexington Avenue, New York, New York 10022, or at such other place, time and date as shall be agreed between the Company and the Purchaser (the date on which the Closing occurs, the “Closing Date”).

(b)At the Closing:

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(i)the Company shall deliver to the Purchaser the Acquired Shares in book-entry form; and

(ii)the Purchaser shall (1) pay the Purchase Price to the Company, by wire transfer in immediately available U.S. federal funds, to the account designated by the Company in writing not less than two (2) Business Days prior to the Closing, (2) deliver to the Company the IRS Form W-9 in accordance with Section 5.09 and (3) deliver to the Company a resignation letter in the form attached as Annex II hereto, duly executed by the Initial Purchaser Director Designee.

Article III

Representations and Warranties of the Company

The Company represents and warrants to the Purchaser as of the date hereof and as of the Closing (except to the extent made only as of a specified date, in which case such representation and warranty is made as of such date) that, except as disclosed in any report, schedule, form, statement or other document (including exhibits) filed with, or furnished to, the SEC and publicly available after December 31, 2016 and prior to the date hereof (the “Filed SEC Documents”), other than any risk factor disclosures in any such Filed SEC Document contained in the “Risk Factors” section thereof:

Section 3.01Organization; Standing

.  The Company is a corporation duly formed, validly existing and in good standing under the Laws of the State of Delaware, with all requisite corporate power and authority necessary to carry on its business as it is now being conducted, except (other than with respect to the Company’s due formation and valid existence) as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  True and complete copies of the Company Charter Documents are included in the Filed SEC Documents.

Section 3.02Capitalization

.  (a)  The authorized capital stock of the Company consists of 500,000,000 shares of Common Stock and 25,000,000 shares of preferred stock (“Company Preferred Stock”).  At the close of business on February 2, 2018 (the “Capitalization Date”), (i) 87,018,252 shares of Common Stock were issued and outstanding (and no Company Restricted Shares were issued and outstanding), (ii) 2,648,021 shares of Common Stock were subject to outstanding Company Stock Options, (iii) 2,135,141 Company RSUs were outstanding pursuant to which a maximum of 2,135,141 shares of Common Stock could be issued, (iv) 5,086,398 shares of Common Stock were reserved and available for issuance under the Company’s long-term incentive plan and (vi) no shares of Company Preferred Stock were issued or outstanding.

(b)Except as described in this Section 3.02, as of the Capitalization Date, there were (i) no outstanding shares of capital stock of, or other equity or voting interests in, the Company, (ii) no outstanding securities of the Company convertible into or exchangeable for shares of capital stock of, or other equity or voting interests in, the 

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Company, (iii) no outstanding options, warrants, rights or other commitments or agreements to acquire from the Company, or that obligate the Company to issue, any capital stock of, or other equity or voting interests (or voting debt) in, or any securities convertible into or exchangeable for shares of capital stock of, or other equity or voting interests in, the Company other than obligations under the Company Plans in the ordinary course of business, (iv) no obligations of the Company to grant, extend or enter into any subscription, warrant, right, convertible or exchangeable security or other similar agreement or commitment relating to any capital stock of, or other equity or voting interests in, the Company (the items in clauses (i), (ii), (iii) and (iv) being referred to collectively as “Company Securities”) and (v) no other obligations by the Company or any of its Subsidiaries to make any payments based on the price or value of any Company Securities.  There are no outstanding agreements of any kind which obligate the Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities (other than pursuant to the cashless exercise of Company Stock Options or the forfeiture or withholding of taxes with respect to Company Stock Options, Company Restricted Shares or Company RSUs), or obligate the Company to grant, extend or enter into any such agreements relating to any Company Securities, including any agreements granting any preemptive rights, subscription rights, anti-dilutive rights, rights of first refusal or similar rights with respect to any Company Securities.  None of the Company or any Subsidiary of the Company is a party to any stockholders’ agreement, voting trust agreement, registration rights agreement or other similar agreement or understanding relating to any Company Securities or any other agreement relating to the disposition, voting or dividends with respect to any Company Securities.  All outstanding shares of Common Stock have been duly authorized and validly issued and are fully paid, nonassessable and free of preemptive rights. 

Section 3.03Authority; Noncontravention

.  (a)  The Company has all necessary corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder.  The execution, delivery and performance by the Company of this Agreement has been duly authorized and approved by the Board, and no further action, approval or authorization is necessary to authorize the execution, delivery and performance by the Company of this Agreement.  This Agreement has been duly executed and delivered by the Company and, assuming due authorization, execution and delivery hereof by the Purchaser, constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except that such enforceability (i) may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar Laws of general application affecting or relating to the enforcement of creditors’ rights generally and (ii) is subject to general principles of equity, whether considered in a proceeding at law or in equity (the “Bankruptcy and Equity Exception”).

(b)Neither the execution and delivery of this Agreement by the Company, nor the consummation by the Company of the Transactions, nor performance or compliance by the Company with any of the terms or provisions hereof, will (i) violate any provision of the Company Charter Documents or (ii) assuming that the authorizations, consents and approvals referred to in Section 3.04 are obtained prior to the Closing Date and the filings referred to in Section 3.04 are made and any waiting 

9

 

 

 

periods thereunder have terminated or expired prior to the Closing Date, (x) violate any Law applicable to the Company or any of its Subsidiaries or (y) violate or constitute a default (or constitute an event which, with notice or lapse of time or both, would violate or constitute a default) under any of the terms or provisions of any loan or credit agreement, indenture, debenture, note, bond, mortgage, deed of trust, lease, sublease, license, contract or other agreement (each, a “Contract”) to which the Company or any of its Subsidiaries is a party, except, in the case of clause (ii), as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 3.04Governmental Approvals

. Except for (a) the filing with the SEC of such current reports and other documents, if any, required to be filed with the SEC under the Exchange Act or Securities Act in connection with the Transactions, (b) filings required under, and compliance with other applicable requirements of, the HSR Act and (c) compliance with any applicable state securities or blue sky laws, no consent or approval of, or filing or registration with, any Governmental Authority is necessary for the execution, delivery and performance by the Company of this Agreement, other than such other consents, approvals, filings or registrations that, if not obtained, made or given, would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 3.05Absence of Certain Changes

.  Since September 30, 2017, there has not been any Material Adverse Effect or any event, change or occurrence that would, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. 

Section 3.06Brokers and Other Advisors

.  No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission, or the reimbursement of expenses in connection therewith, in connection with the Transactions based upon arrangements made by or on behalf of the Company or any of its Subsidiaries.

Section 3.07Sale of Securities

.  Assuming the accuracy of the representations and warranties set forth in Section 4.07, the sale of the shares of Common Stock pursuant to this Agreement is exempt from the registration requirements of the Securities Act. Without limiting the foregoing, neither the Company nor, to the knowledge of the Company, any other Person authorized by the Company to act on its behalf, has engaged in a general solicitation or general advertising (within the meaning of Regulation D under the Securities Act) of investors with respect to offers or sales of Common Stock, and neither the Company nor, to the knowledge of the Company, any Person acting on its behalf has made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause the offering or issuance of Common Stock under this Agreement to be integrated with prior offerings by the Company for purposes of the Securities Act that would result in Regulation D or any other applicable exemption from registration under the Securities Act to not be available, nor will the Company take any action or steps that would cause the offering or issuance of Common Stock under this Agreement to be integrated with other offerings by the Company.

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Section 3.08Listing and Maintenance Requirements

.  The Common Stock is registered pursuant to Section 12(b) of the Exchange Act and listed on the NYSE, and the Company has taken no action designed to, or which to the knowledge of the Company is reasonably likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act or delisting the Common Stock from the NYSE, nor has the Company received as of the date of this Agreement any notification that the SEC or the NYSE is contemplating terminating such registration or listing.

Section 3.09Filed SEC Documents.  The Company has filed with or furnished to the SEC all reports, schedules, forms, statements and other documents required to be filed or furnished by the Company pursuant to the Exchange Act since December 31, 2016 on a timely basis or has received a valid extension of such time of filing and has so filed prior to the expiration of any such extension; provided that no representation or warranty is hereby given with respect to filings under Section 16 of the Exchange Act or exhibits required under Item 601 of Regulation S-K. As of their respective filing dates, the Filed SEC Documents complied in all material respects with the requirements of the Securities Act, the Exchange Act and the Sarbanes-Oxley Act of 2002, as applicable, and none of the Filed SEC Documents, when filed (or, if amended prior to the date hereof, the date of the filing of such amendment, with respect to the disclosures that are amended), contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

Section 3.10No Other Company Representations or Warranties

.  Except for the representations and warranties made by the Company in this Article III and in any certificate or other document delivered in connection with this Agreement, neither the Company nor any other Person acting on its behalf makes any other express or implied representation or warranty with respect to the Common Stock, the Company or any of its Subsidiaries or their respective businesses, operations, properties, assets, liabilities, condition (financial or otherwise) or prospects, notwithstanding the delivery or disclosure to the Purchaser or its Affiliates or any of their respective Representatives of any documentation or other information with respect to any one or more of the foregoing. 

Section 3.11No Other Purchaser Representations or Warranties.  Except for the representations and warranties expressly set forth in Article IV and in any certificate or other document delivered in connection with this Agreement, the Company hereby acknowledges that neither the Purchaser nor any of its Affiliates, nor any other Person, has made or is making any other express or implied representation or warranty with respect to the Purchaser.

Article IV

Representations and Warranties of the Purchaser

The Purchaser represents and warrants to the Company, as of the date hereof and as of the Closing Date:

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Section 4.01Organization; Standing

.  The Purchaser is a limited liability company duly formed, validly existing and in good standing under the Laws of Delaware, with all requisite limited liability company power and authority necessary to carry on its business as it is now being conducted, except (other than with respect to the Purchaser’s due formation and valid existence) as would not, individually or in the aggregate, reasonably be expected to have a Purchaser Material Adverse Effect.

Section 4.02Authority; Noncontravention

(a).  (a)  The Purchaser has all necessary limited liability company power and authority to execute and deliver this Agreement and to perform its obligations hereunder.  The execution, delivery and performance by the Purchaser of this Agreement has been duly authorized and approved by the sole manager of the Purchaser, and no further action, approval or authorization is necessary to authorize the execution, delivery and performance by the Purchaser of this Agreement.  This Agreement has been duly executed and delivered by the Purchaser and, assuming due authorization, execution and delivery hereof by the Company, constitutes a legal, valid and binding obligation of the Purchaser, enforceable against it in accordance with its terms, subject to the Bankruptcy and Equity Exception.  

(b)Neither the execution and delivery of this Agreement by the Purchaser, nor the consummation by the Purchaser of the Transactions, nor performance or compliance by the Purchaser with any of the terms or provisions hereof, will (i) violate any provision of the certificate of formation or limited liability company agreement of the Purchaser or (ii) assuming that the authorizations, consents and approvals referred to in Section 4.03 are obtained prior to the Closing Date and the filings referred to in Section 4.03 are made and any waiting periods with respect to such filings have terminated or expired prior to the Closing Date, (x) violate any Law applicable to such Purchaser or any of its Subsidiaries or (y) violate or constitute a default (or constitute an event which, with notice or lapse of time or both, would violate or constitute a default) under any of the terms, conditions or provisions of any Contract to which the Purchaser or any of its Subsidiaries is a party, except, in the case of clause (ii), as would not, individually or in the aggregate, reasonably be expected to have a Purchaser Material Adverse Effect.

Section 4.03Governmental Approvals

.  Except for (a) the filing with the SEC of such current reports and other documents, if any required to be filed with the SEC under the Exchange Act or Securities Act in connection with the Transactions, (b) filings required under, and compliance with other applicable requirements of the HSR Act, no consent or approval of, or filing or registration with, any Governmental Authority is necessary for the execution, delivery and peformance of this Agreement, other than such other consents, approvals, filings or registrations that, if not obtained, made or given, would not, individually or in the aggregate, reasonably be expected to have a Purchaser Material Adverse Effect.

Section 4.04Sufficient Funds. The Purchaser has available to it as of the date of this Agreement, and will have at the Closing, sufficient funds to enable the Purchaser to pay in full at the Closing the entire amount of the Purchase Price in immediately available funds.

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Section 4.05Ownership of Company Stock

.  None of the Purchaser nor any of its Affiliates (other than officers and directors of the Purchaser and its Affiliates, as to which the Purchaser makes no representation or warranty) owns any capital stock or other securities of the Company. 

Section 4.06Brokers and Other Advisors

.  No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission, or the reimbursement of expenses in connection therewith, in connection with the Transactions based upon arrangements made by or on behalf of the Purchaser or any of its Subsidiaries, except for Persons, if any, whose fees and expenses will be fully paid by the Purchaser or one of its Affiliates.

Section 4.07Purchase for Investment

.  The Purchaser acknowledges that the Acquired Shares have not been registered under the Securities Act or under any state or other applicable securities laws. The Purchaser (a) acknowledges that it is acquiring the Acquired Shares pursuant to an exemption from registration under the Securities Act solely for investment and not with a view to the distribution of the Acquired Shares to any Person, (b) will not sell, transfer, or otherwise dispose of any of the Acquired Shares, except in compliance with this Agreement and the registration requirements or exemption provisions of the Securities Act and any other applicable securities Laws, (c) has such knowledge and experience in financial and business matters and in investments of this type that it is capable of evaluating the merits and risks of its investment in the Acquired Shares and of making an informed investment decision, (d) is an “accredited investor” (as that term is defined by Rule 501 of the Securities Act), and (e) (1) has been furnished with or has had full access to all the information that it considers necessary or appropriate to make an informed investment decision with respect to the Acquired Shares, (2) has had an opportunity to discuss with the Company and its Representatives the intended business and financial affairs of the Company and to obtain information  necessary to verify any information furnished to it or to which it had access and (3) can bear the economic risk of (i) an investment in the Acquired Shares indefinitely and (ii) a total loss in respect of such investment.  The Purchaser has such knowledge and experience in business and financial matters so as to enable it to understand and evaluate the risks of, and form an investment decision with respect to its investment in, the Acquired Shares and to protect its own interest in connection with such investment.

Section 4.08No Other Purchaser Representations or Warranties.  Except for the representations and warranties made by the Purchaser in this Article IV and in any certificate or other document delivered in connection with this Agreement, neither the Purchaser nor any other Person acting on its behalf makes any other express or implied representation or warranty with respect to the Purchaser, notwithstanding the delivery or disclosure to the Company or its Affiliates or any of their respective Representatives of any documentation or other information with respect to the foregoing.

Section 4.09No Other Company Representations or Warranties

.  Except for the representations and warranties expressly set forth in Article III and in any certificate or other document delivered in connection with this Agreement, the Purchaser hereby acknowledges that neither the Company nor any of its Subsidiaries, nor any other 

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Person, has made or is making any other express or implied representation or warranty with respect to the Company or any of its Subsidiaries or their respective businesses, operations, assets, liabilities, condition (financial or otherwise) or prospects, including with respect to any information provided or made available to the Purchaser or its Affiliates or their respective Representatives or any information developed by the Purchaser or any of its Representatives.  The Purchaser hereby acknowledges (for itself and on behalf of its Affiliates and Representatives) that it has conducted, to its satisfaction, its own independent investigation of the business, operations, assets and financial condition of the Company and its Subsidiaries and, in making its determination to proceed with the Transactions, the Purchaser and its Affiliates and Representatives have relied on the results of their own independent investigation and the representations and warranties expressly set forth in Article III.

Article V

Additional Agreements

Section 5.01Reasonable Best Efforts; Filings

.  (a) Subject to the terms and conditions of this Agreement, each of the Company and the Purchaser shall cooperate with each other and use (and shall cause its Subsidiaries to use) its reasonable best efforts (unless, with respect to any action, another standard of performance is expressly provided for herein) to promptly (i) take, or cause to be taken, all actions, and do, or cause to be done, and assist and cooperate with each other in doing, all things necessary, proper or advisable to cause the conditions to Closing to be satisfied as promptly as reasonably practicable and to consummate and make effective, in the most expeditious manner reasonably practicable, the Transactions, including preparing and filing promptly and fully all documentation to effect all necessary filings, notices, petitions, statements, registrations, submissions of information, applications and other documents, (ii) obtain all approvals, consents, registrations, waivers, permits, authorizations, orders and other confirmations from any Governmental Authority or third party necessary, proper or advisable to consummate the Transactions, (iii) execute and deliver any additional instruments necessary to consummate the Transactions and (iv) defend or contest in good faith any threatened legal or administrative proceeding, suit, investigation, arbitration or action (“Action”) brought by a third party that could otherwise prevent or impede, interfere with, hinder or delay in any material respect the consummation of the Transactions.

(b)The Company and the Purchaser agree to make an appropriate filing of a Notification and Report Form (“HSR Form”) pursuant to the HSR Act with respect to the Transactions (which shall request the early termination of any waiting period applicable to the Transactions under the HSR Act) as promptly as reasonably practicable following the date of this Agreement, and to supply as promptly as reasonably practicable any additional information and documentary material that may be requested pursuant to the HSR Act and to promptly take any and all steps necessary to avoid or eliminate each and every impediment and obtain all consents that may be required pursuant to the HSR Act, so as to enable the parties hereto to consummate the 

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Transactions.  The Purchaser will pay all filings fees in connection with filings made under the HSR Act and any similar laws.

(c)Each of the Company and the Purchaser shall use their respective reasonable best efforts to (i) cooperate in all respects with the other party in connection with any filing or submission with a Governmental Authority in connection with the Transactions and in connection with any investigation or other inquiry by or before a Governmental Authority relating to the Transactions, including any proceeding initiated by a private person, (ii) keep the other party informed in all material respects and on a reasonably timely basis of any material communication received by the Company or the Purchaser, as the case may be, from or given by the Company or the Purchaser, as the case may be, to the Federal Trade Commission (“FTC”), the Department of Justice (“DOJ”) or any other Governmental Authority and of any material communication received or given in connection with any proceeding by a private Person, in each case regarding the Transactions, (iii) subject to applicable Laws relating to the exchange of information, and to the extent reasonably practicable, consult with the other party with respect to information relating to such party and its respective Subsidiaries, as the case may be, that appears in any filing made with, or written materials submitted to, any third Person or any Governmental Authority in connection with the Transactions, other than “4(c) and 4(d) documents” as that term is used in the rules and regulations under the HSR Act and other confidential information contained in the HSR Form, and (iv) to the extent permitted by the FTC, the DOJ or such other applicable Governmental Authority or other Person, give the other party the opportunity to attend and participate in such meetings and conferences.

Section 5.02Public Disclosure

.  The Purchaser and the Company shall consult with each other before issuing, and give each other the opportunity to review and comment upon, any press release or other public statements with respect to this Agreement or the Transactions, and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable Law, Judgment, court process or the rules and regulations of any national securities exchange or national securities quotation system.  The Purchaser and the Company agree that the initial press release to be issued with respect to the Transactions following execution of this Agreement shall be in the form attached hereto as Annex I (the “Announcement”).  Notwithstanding the forgoing, this Section 5.02 shall not apply to any press release or other public statement made by the Company, the Purchaser or Purchaser Parent (a) which is consistent with the Announcement and does not contain any information relating to the Transactions that has not been previously announced or made public in accordance with the terms of this Agreement or (b) is made in the ordinary course of business and does not relate specifically to the signing of this Agreement or the Transactions.   

Section 5.03NYSE Listing of Shares.  To the extent the Company has not done so prior to the date of this Agreement, the Company shall promptly apply and use its commercially reasonable efforts to cause the Acquired Shares to be approved for listing on the NYSE, subject to official notice of issuance.

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Section 5.04Standstill

.  

(a)The Purchaser agrees that until the later of (i) ninety (90) days after the first day on which no Purchaser Designee serves on the Board and the Purchaser has no rights to, or has waived any right to, appoint, designate or elect a Purchaser Director pursuant to Section 5.07(d) and (ii) the two-year anniversary of the Closing Date (the later of such dates, the “Standstill Expiration Date”), without the prior written approval of the Board, the Purchaser will not, directly or indirectly, and will cause its Affiliates not to:

(i)acquire, offer or seek to acquire, agree to acquire or make a proposal to acquire, by purchase or otherwise, any securities or direct or indirect rights to acquire any securities of the Company or any of its Affiliates, any securities convertible into or exchangeable for any such securities, any options or other derivative securities or contracts or instruments in any way related to the price of shares of Common Stock or any assets or property of the Company or any Subsidiary of the Company (but in any case excluding any issuance by the Company of shares of Common Stock or options, warrants or other rights to acquire Common Stock (or the exercise thereof) (x) pursuant to any stock dividend or distribution, stock split or other recapitalization or reclassification of the Common Stock or pursuant to any shareholder rights plan or similar plan, or (y) to any Purchaser Director as compensation for their membership on the Board); provided that this clause (i) shall not limit the Purchaser or its Affiliates from acquiring, offering or seeking to acquire, agreeing to acquire or making a proposal to acquire Common Stock to the extent that, upon consummation of any such transaction, the Purchaser and its Affiliates would beneficially own Common Stock in an amount not to exceed 4.9% of the then-outstanding Common Stock;

(ii)make or knowingly encourage or participate in any “solicitation” of “proxies” (whether or not relating to the election or removal of directors), as such terms are used in the rules of the SEC, to vote, or knowingly seek to advise or influence any Person with respect to voting of, any voting securities of the Company or any of its Subsidiaries, or call or seek to call a meeting of the Company’s stockholders or initiate any stockholder proposal for action by the Company’s stockholders, or seek election to or to place a representative on the Board (other than as expressly set forth in Section 5.07 with respect to a Purchaser Designee or Purchaser Director), or seek the removal of any director from the Board (other than as expressly set forth in Section 5.07 with respect to a Purchaser Director);

(iii)demand a copy of the stock ledger list of stockholders or any other books and records of the Company;

(iv)make any public announcement with respect to, or publicly offer, seek, propose or indicate an interest in (in each case with or without conditions), any merger, consolidation, business combination, tender or exchange offer, recapitalization, reorganization or purchase of a material portion of the 

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assets, properties or securities of the Company or any Subsidiary of the Company, or any other extraordinary transaction involving the Company or any Subsidiary of the Company or any of their respective securities, or enter into any  negotiations, arrangements, understandings or agreements (whether written or oral) with any other Person regarding any of the foregoing;

(v)otherwise act, alone or in concert with others, other than a Purchaser Director, to seek to control or influence, in any manner, the management, board of directors or policies of the Company or any of its Subsidiaries;

(vi)publicly make any proposal or statement of inquiry or publicly disclose any intention, plan or arrangement inconsistent with any of the foregoing;

(vii)advise, assist, knowingly encourage or direct any Person to do, or to advise, assist, encourage or direct any other Person to do, any of the foregoing;

(viii)take any action that would require the Company to make a public announcement regarding the possibility of any of the events described in this Section 5.04(a);

(ix)enter into any negotiations, arrangements or understandings with any third party (including, without limitation, security holders of the Company, but excluding, for the avoidance of doubt, any Affiliate of the Purchaser) with respect to any of the foregoing, including, without limitation, forming, joining or participating in a “group” (as defined in Section 13(d)(3) of the Exchange Act) with any third party with respect to any securities of the Company or otherwise in connection with any of the foregoing;

(x)request the Company or any of its Representatives to amend or waive any provision of this Section 5.04(a), provided that this clause shall not prohibit the Purchaser Parties from making a confidential request to the Company seeking an amendment or waiver of the provisions of this Section 5.04(a), which the Company may accept or reject in its sole discretion, so long as any such request is made in a manner that does not require public disclosure thereof by any Person; or

(xi)contest the validity of this Section 5.04 or make, initiate, take or participate in any demand, Action (legal or otherwise) or proposal to amend, waive or terminate any provision of this Section 5.04;

provided, however, that nothing in this Section 5.04 will limit (1) the Purchaser Parties’ ability to vote (subject to Section 5.08), Transfer or Hedge (subject to Section 5.05) or otherwise exercise rights under its Common Stock or (2) the ability of any Purchaser Director to vote or otherwise exercise his or her legal duties or otherwise act in his or her capacity as a member of the Board.

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(b)Notwithstanding Section 5.04(a), if the Company undertakes a process for a sale transaction that would, if consummated, constitute a Change of Control, the Company shall notify the Purchaser of such process and allow the Purchaser or Purchaser Parent to participate in such process, on the terms and conditions thereof, and, solely for such purpose, the restrictions set forth in Section 5.04(a) will not apply to Purchaser or Purchaser Parent’s participation in such process (and for the avoidance of doubt, the Purchaser shall not be entitled to any right of first refusal or right of first offer or similar right nor shall the restrictions set forth in Section 5.04(a) terminate with respect to any actions taken that are not in compliance with the terms and conditions of the process as reasonably determined by the Company).

(c)Notwithstanding Section 5.04(a), if (i) the Company enters into a binding definitive agreement with any third party providing for a Change of Control, (ii) any Person or group (other than the Purchaser or any of its Affiliates) acquires beneficial ownership of more than 35% of the outstanding Common Stock, (iii) any Bona Fide Acquiror makes a public or non-public offer or proposal to the Company which, if fully subscribed, would result in such Bona Fide Acquiror acquiring beneficial ownership of more than 35% of the outstanding Common Stock, or publicly announces a proposal to effect a transaction involving a Change of Control of the Company (any such offer or proposal, a “Third Party Proposal”) and, following such Third Party Proposal contemplated by this clause (iv), the Company or its Representatives provides material non-public information to any such Bona Fide Acquiror or its Representatives or engages in substantive negotiations with such Bona Fide Acquiror or its Representatives, or (iv) any Bona Fide Acquiror publicly announces a tender or exchange offer for more than 35% of the outstanding Common Stock and files a tender offer statement under Section 14(d)(1) or 13(e)(1) of the Exchange Act and within ten (10) business days thereafter, the Company has not publicly taken a position rejecting such tender or exchange offer or, if the Company has publicly taken a position rejecting such tender or exchange offer within such 10-day business day period, the Company subsequently publicly takes a position approving such tender or exchange offer, then the provisions of Section 5.04(a) shall terminate solely to the extent necessary to facilitate a public or private offer by the Purchaser or its Affiliates to acquire directly or indirectly at least a majority of the outstanding shares of Common Stock or all or substantially all of the Company’s assets. Furthermore, nothing in this Agreement shall be construed to prohibit Purchaser or its Affiliates from submitting to the Board or the Chief Executive Officer of the Company, one or more confidential proposals or offers for a potential transaction (including a Change of Control transaction) with or relating to the Company (as long as such confidential offer or proposal is made in a manner that would not require the Purchaser or the Company or their respective Affiliates to make a public announcement regarding such confidential offer or proposal) or from taking any action expressly contemplated by or exercising any rights under the MSA.

(d)If any Purchaser Competitor, including any group of which a Purchaser Competitor comprises a majority-in-interest, acquires beneficial ownership of (i) more than 4.9% but less than 15% of the outstanding Common Stock, then, notwithstanding Section 5.04(a)(i), the Purchaser Parties may acquire additional shares of Common Stock so that the beneficial ownership of the Purchaser Parties in the aggregate 

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is not greater than the beneficial ownership of the Purchaser Competitor and such group, or (ii) 15% or more of the outstanding Common Stock, then the provisions of Section 5.04(a)(i) shall terminate.

Section 5.05Transfer Restrictions

.  (a)  Except as otherwise permitted in this Agreement, including Section 5.05(b), until the earlier of (x) the 24-month anniversary of the Closing Date and (y) thirty (30) days following the termination of the MSA, the Purchaser Parties will not (i) Transfer any Common Stock or (ii) make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a short sale of or the purpose of which is to offset the loss which results from a decline in the market price of, any shares of Common Stock, or otherwise establish or increase, directly or indirectly, a put equivalent position, as defined in Rule 16a-1(h) of the Exchange Act, with respect to any of the Common Stock or any other capital stock of the Company (any such action, a “Hedge”).

(b)Notwithstanding Section 5.05(a), the Purchaser Parties shall be permitted to Transfer any portion or all of their Common Stock at any time under the following circumstances:

(i)Transfers to any Permitted Transferees, but only if the transferee agrees in writing prior to such Transfer for the express benefit of the Company (in form and substance reasonably satisfactory to the Company and with a copy thereof to be furnished to the Company) to be bound by the terms of this Agreement and if the transferee and the transferor agree for the express benefit of the Company that the transferee shall Transfer the Common Stock so Transferred back to the transferor at or before such time as the transferee ceases to be a Permitted Transferee;

(ii)Transfers pursuant to a merger, tender offer or exchange offer or other business combination, acquisition of assets or similar transaction or any Change of Control transaction involving the Company that has been approved or recommended by the Board; and

(iii)Transfers that have been approved in writing by the Board.

(c)Notwithstanding Sections 5.05(a) and (b), the Purchaser Parties will not at any time, directly or knowingly indirectly (without the prior written consent of the Board) Transfer any Common Stock:

(i)to a Prohibited Transferee;

(ii)to the Purchaser’s knowledge (following reasonable investigation in a negotiated transaction, which may be satisfied by a representation to such effect from the transferee), to a 5% Entity; provided, however, that this Section 5.05(c)(ii) shall not restrict any Transfer pursuant to Section 5.05(b)(ii) or (iii) or Section 5.05(d); or

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(iii)for so long as the Purchaser Parties satisfy the 50% Beneficial Ownership Requirement, in any 30-calendar day period, an aggregate number of shares of Common Stock that would be in excess of 1% of the outstanding shares of the Common Stock at the time of such Transfer; provided, however, that this Section 5.05(c)(iii) shall not restrict any Transfer to any Permitted Transferee or any Transfer pursuant to Section 5.05(b)(ii) or (iii).

(d)Notwithstanding Sections 5.05(a) or (b), until the earlier of (x) the 24-month anniversary of the Closing Date and (y) thirty (30) days following the termination of the MSA, the Purchaser Parties will not tender any shares of Common Stock into any “tender offer” (as defined in Regulation 14D under the Exchange Act) to acquire the equity securities of the Company that has not been approved (at the time of commencement or thereafter) by the Board.

(e)Any attempted Transfer in violation of this Section 5.05 shall be null and void ab initio.

Section 5.06Legend

.  (a)  All certificates or other instruments (including book-entry notations) representing the Common Stock will bear a legend substantially to the following effect:

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS.  

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO TRANSFER AND OTHER RESTRICTIONS SET FORTH IN AN INVESTMENT AGREEMENT, DATED AS OF FEBRUARY 7, 2018, COPIES OF WHICH ARE ON FILE WITH THE SECRETARY OF THE ISSUER.

(b)Upon request of the applicable Purchaser Party, upon receipt by the Company of an opinion of counsel reasonably satisfactory to the Company to the effect that such legend is no longer required under the Securities Act and applicable state  securities laws, the Company shall promptly cause the first paragraph of the legend to be removed from any certificate for Common Stock to be Transferred in accordance with the terms of this Agreement and the second paragraph of the legend shall be removed upon the expiration of such transfer and other restrictions set forth in this Agreement (and, for the avoidance of doubt, immediately prior to any termination of this Agreement) or upon the Transfer in accordance with the terms of this Agreement to any Person that is not subject to the transfer and other restrictions set forth in this Agreement.  

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Section 5.07Election of Directors

.  (a)  Election of Directors.  (a) Effective as of the Closing Date, the Board of Directors shall increase the size of the Board (if there are no vacancies then on the Board) and appoint Arthur Francis Starrs, III (such individual, the “Initial Purchaser Director Designee”) as a director to fill such vacancy; provided, that, if the Initial Purchaser Director Designee is unable to serve due to death, disability or incapacity as of such time of appointment, the Purchaser shall be entitled to designate another Person reasonably acceptable to the Board (and the Nominating and Corporate Governance Committee of the Board) to serve as the Initial Purchaser Director Designee and a director of the Company.  The Initial Purchaser Director Designee shall be appointed as a Class III director with a term expiring in 2020, if appointed prior to the date of the Company’s 2018 annual meeting of stockholders, or a Class I director with a term expiring in 2021, if appointed after the date of the Company’s 2018 annual meeting of stockholders, in each case so long as such appointment is permitted by the listing rules of the NYSE and, if not permitted, shall be appointed to the class of directors with the longest then-remaining term.

(b)Upon the occurrence of the Fall-Away of Purchaser Board Rights, (i) at the request of the Board, upon or at any time following the occurrence of the Fall-Away of Purchaser Board Rights, the Purchaser Director shall immediately resign, and the Purchaser Parties shall cause the Purchaser Director immediately to resign, from the Board effective as of the date of the Fall-Away of Purchaser Board Rights, and (ii) the Purchaser shall no longer have any rights under this Section 5.07, including, for the avoidance of doubt, any designation and/or nomination rights under Section 5.07(d); provided, that the former Purchaser Directors shall continue to be entitled to the rights to indemnification and insurance pursuant to Section 5.07(g).

(c)Until the occurrence of the Fall-Away of Purchaser Board Rights, at any annual meeting of the Company’s stockholders at which the term of the Purchaser Director shall expire, the Purchaser shall have the right to designate one Purchaser Designee which Purchaser Designee will be nominated by the Company as “Purchaser Designee” for election to the Board at such annual meeting. The Company shall (i) include the Purchaser Designee designated by the Purchaser in accordance with this Section 5.07(c) in the Company’s slate of nominees for the applicable annual meeting of the Company’s stockholders,  (ii) recommend that the holders of the Company’s Common Stock vote in favor of the Purchaser Designee, and (iii) cause all shares of Common Stock represented by proxies received by the Company or the Board for which a vote has not been marked (physically or electronically) on the proxy to be voted in favor of the Purchaser Designee if and to the same extent that the Company does the same with respect to the other nominees on the Company’s slate of nominees.

(d)In the event of the death, disability, resignation or removal of any Purchaser Director as a member of the Board (other than resignation pursuant to Section 5.07(b)), the Purchaser, if it is entitled to nominate one or more directors pursuant to this Section 5.07, may designate a Purchaser Designee to replace such Purchaser Director and, subject to Section 5.07(e) and any applicable provisions of the DGCL, the Company shall cause such Purchaser Designee to fill such resulting vacancy.

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(e)The Company’s obligations to have any Purchaser Designee elected to the Board or nominate any Purchaser Designee for election as a director at any meeting of the Company’s stockholders pursuant to this Section 5.07, as applicable, shall in each case be subject to (A) such Purchaser Designee’s satisfaction of all requirements regarding service as a director of the Company under applicable Law and stock exchange rules regarding service as a director of the Company and all other criteria and qualifications for service as a director applicable to all non-executive directors of the Company; provided, that the shares of Common Stock owned by the Purchaser Parties shall count towards the Purchaser Director’s stock ownership requirements under the Company’s stock ownership guidelines, and (B) such Purchaser Designee meeting all independence requirements under Rule 303A.02(b) (other than Rule 303A.02(b)(v) as it relates to payments under the MSA) of the NYSE; provided that in no event shall such Purchaser Designee’s relationship with the Purchaser Parties or their Affiliates or the existence of or payments under the MSA or the Purchaser Parties’ ownership of Common Stock, in and of itself, be considered to disqualify such Purchaser Designee from being a member of the Board pursuant to this Section 5.07. The Purchaser Parties will cause the Purchaser Designee to make himself or herself reasonably available for interviews and to consent to such reference and background checks or other investigations as the Board may reasonably request to determine the Purchaser Designee’s eligibility and qualification to serve as a director of the Company. No Purchaser Designee shall be eligible to serve on the Board if he or she has been involved in any of the events enumerated under Item 2(d) of Schedule 13D under the Exchange Act or Item 401(f) of Regulation S-K under the Securities Act or is subject to any Judgment prohibiting service as a director of any public company. As a condition to any Purchaser Designee’s election to the Board or nomination for election as a director of the Company at any meeting of the Company’s stockholders, the Purchaser Parties and the Purchaser Designee must provide to the Company:

(i)all information reasonably requested by the Company that is required to be or is customarily disclosed for directors, candidates for directors and their respective Affiliates and Representatives in a proxy statement or other filings in accordance with applicable Law, any stock exchange rules or listing standards or the Company Charter Documents or corporate governance guidelines, in each case, relating to the Purchaser Designee’s election as a director of the Company or the Company’s operations in the ordinary course of business;

(ii)all information reasonably requested by the Company in connection with assessing eligibility, independence and other criteria applicable to non-executive directors of the Company or satisfying compliance and legal or regulatory obligations, in each case, relating to the Purchaser Designee’s nomination or election, as applicable, as a director of the Company or the Company’s operations in the ordinary course of business;

(iii)an undertaking in writing by the Purchaser Designee:

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a.to be subject to, bound by and duly comply with the Company’s Code of Business Conduct and Ethics and any other policies applicable to the other non-executive directors of the Company; and

b.to recuse himself or herself from any deliberations or discussion of the Board or any committee thereof (i) regarding this Agreement or the MSA or any of the terms, provisions or transactions hereunder or thereunder or (ii) that, in the Board’s sole judgment, would reasonably be likely to (A) result in a conflict of interest, (B) adversely affect the attorney-client privilege between the Company and its counsel,  or (C) result in a violation of applicable Law; and

(iv)a written irrevocable resignation substantially in the form attached hereto as Annex II.

(f)The Company shall be permitted to withhold any information and to exclude the Purchaser Director from any meeting or portion thereof with respect to information and meetings involving items to which Section 5.07(e)(iii)(b) is applicable.

(g)The Company shall indemnify the Purchaser Director and provide the Purchaser Director with director and officer insurance to the same extent as it indemnifies and provides such insurance to other members of the Board, pursuant to the Company Charter Documents, the DGCL or otherwise.  The Company shall not be required to provide the Purchaser Director with director compensation.

Section 5.08Voting

.  Until the Fall-Away of Purchaser Board Rights: 

(a)at each meeting of the stockholders of the Company and at every postponement or adjournment thereof, the Purchaser shall, and shall cause the Purchaser Parties to, take such action as may be required so that all of the shares of Common Stock beneficially owned, directly or indirectly, by the Purchaser Parties and entitled to vote at such meeting of stockholders are voted (i) in favor of each director nominated and recommended by the Board for election at any such meeting, (ii) against any stockholder nominations for director which are not approved and recommended by the Board for election at any such meeting, (iii) in favor of the Company’s “say-on-pay” proposal and any proposal by the Company relating to equity compensation that has been approved by the Compensation Committee of the Board and as recommended by the Board with respect to any “say-on-frequency” proposal and (iv) in favor of the Company’s proposal for ratification of the appointment of the Company’s independent registered public accounting firm; provided that no Purchaser Party shall be obligated to vote in the same manner as recommended by the Board or in any other manner, other than in the Purchaser Parties’ sole discretion, with respect to any other matter, including the approval (or non-approval) or adoption (or non-adoption) of, or other proposal directly related to, any merger or other business combination transaction involving the Company, the sale of all or substantially all of the assets of the Company and its Subsidiaries or any other Change of Control transaction involving the Company; provided, further, that in the event that any proposal submitted by a stockholder is subject to a vote of the Company’s 

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stockholders, the Purchaser Parties shall not, and shall cause their Affiliates not to, publicly comment on such proposal and if the Purchaser Parties intend to cause any shares of Common Stock beneficially owned by the Purchaser Parties to be voted in a manner that is not in accordance with the Board’s recommendation with respect to such stockholder proposal, the Purchaser Parties shall not permit any such shares of Common Stock to be voted until the time of the relevant meeting of the Company’s stockholders; and

(b)the Purchaser shall, and shall (to the extent necessary to comply with this Section 5.08) cause the Purchaser Parties to, be present, in person or by proxy, at all meetings of the stockholders of the Company so that all shares of Common Stock beneficially owned by the Purchaser or the Purchaser Parties may be counted for the purposes of determining the presence of a quorum and voted in accordance with Section 5.08(a) at such meetings (including at any adjournments or postponements thereof).

Section 5.09Tax Matters

.  (a)  The Company and its paying agent shall be entitled to withhold taxes on all payments on the Common Stock to the extent required by applicable Law.  Any such amounts withheld with respect to a payment on the Common Stock shall be treated for all purposes of this Agreement as having been paid to the applicable Purchaser Party.  On the Closing Date, the Purchaser shall deliver to the Company and, if applicable, its paying agent a duly executed, valid, accurate and properly completed Internal Revenue Service (“IRS”) Form W-9.  Each Purchaser Party shall deliver to the Company and, if applicable, its paying agent a duly executed, valid, accurate and properly completed IRS Form W-9 or an appropriate IRS Form W-8, as applicable, promptly upon becoming a Purchaser Party.  The Purchaser and each Purchaser Party agrees that if any IRS Form W-9 or appropriate IRS Form W-8 that it previously delivered expires or becomes obsolete or inaccurate in any respect, the Purchaser or Purchaser Party, as applicable, shall promptly update such IRS Form W-9 or appropriate IRS Form W-8.

(b)The Purchaser shall pay any and all documentary, stamp and similar issuance or transfer tax due on the issuance of shares of Common Stock.

Article VI

Conditions to Closing

Section 6.01Conditions to the Obligations of the Company and the Purchaser.  The respective obligations of each of the Company and the Purchaser to effect the Closing shall be subject to the satisfaction (or waiver by the Company and the Purchaser, if permissible under applicable Law) on or prior to the Closing Date of the following conditions:

(a)no temporary or permanent Judgment shall have been enacted, promulgated, issued, entered, amended or enforced by any Governmental Authority nor shall any proceeding seeking any of the foregoing be pending, or any applicable Law 

24

 

 

 

shall be in effect, enjoining or otherwise prohibiting consummation of the Transactions (collectively, “Restraints”);

(b)the waiting period (and any extension thereof) applicable to the consummation of Transactions under the HSR Act shall have expired or early termination thereof shall have been granted; and

(c)the MSA has been executed and delivered by each of the parties thereto and is in full force and effect.

Section 6.02Conditions to the Obligations of the Company

.  The obligations of the Company to effect the Closing shall be further subject to the satisfaction (or waiver by the Company, if permissible under applicable Law) on or prior to the Closing Date of the following conditions:

(a)the representations and warranties of the Purchaser (i) set forth in Article IV of this Agreement, other than in Sections 4.01 and 4.02(a),  shall be true and correct in all material respects as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date (except to the extent expressly made as of an earlier date, in which case as of such earlier date) and (ii) set forth in Sections 4.01 and 4.02(a) shall be true and correct in all respects as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date;

(b)the Purchaser shall have complied with or performed in all material respects its obligations required to be complied with or performed by it pursuant to this Agreement at or prior to the Closing; and

(c)the Company shall have received a certificate, signed on behalf of  the Purchaser by an executive officer thereof, certifying that the conditions set forth in Section 6.02(a) and Section 6.02(b) have been satisfied.

Section 6.03Conditions to the Obligations of the Purchaser. The obligations of the Purchaser to effect the Closing shall be further subject to the satisfaction (or waiver by the Purchaser, if permissible under applicable Law) on or prior to the Closing Date of the following conditions:

(a)the representations and warranties of the Company (i) set forth in Article III of this Agreement, other than in Sections 3.01 and 3.03(a), shall be true and correct (disregarding all qualifications or limitations as to “materiality”, “Material Adverse Effect” and words of similar import set forth therein) as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date (except to the extent expressly made as of an earlier date, in which case as of such earlier date), except where the failure to be true and correct would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect and (ii) set forth in Sections 3.01 and 3.03(a) shall be true and correct in all respects as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date;

25

 

 

 

(b)the Company shall have complied with or performed in all material respects its obligations required to be complied with or performed by it pursuant to this Agreement at or prior to the Closing; 

(c)the Purchaser shall have received a certificate, signed on behalf of the Company by an executive officer thereof, certifying that the conditions set forth in Section 6.03(a) and Section 6.03(b) have been satisfied; and

(d)the Board shall have taken all actions necessary and appropriate to cause to be appointed or elected to the Board, effective upon the Closing, the Initial Purchaser Director Designee. 

Article VII

Termination; Survival

Section 7.01Termination

.  This Agreement may be terminated and the Transactions abandoned at any time prior to the Closing:

(a)by the mutual written consent of the Company and the Purchaser;

(b)by either the Company or the Purchaser upon written notice to the other, if the Closing should not have occurred on or prior to July 31, 2018 (the “Termination Date”); provided that the right to terminate this Agreement under this Section 7.01(b) shall not be available to any party if the breach by such party of its representations and warranties set forth in this Agreement or the failure of such party to perform any of its obligations under this Agreement has been a principal cause of or primarily resulted in the events specified in this Section 7.01(b); 

(c)by either the Company or the Purchaser if any Restraint enjoining or otherwise prohibiting consummation of the Transactions shall be in effect and shall have become final and nonappealable prior to the Closing Date; provided that the party seeking to terminate this Agreement pursuant to this Section 7.01(c) shall have used the required efforts to cause the conditions to Closing to be satisfied in accordance with Section 5.01;

(d)by the Purchaser if the Company shall have breached any of its representations or warranties or failed to perform any of its covenants or agreements set forth in this Agreement, which breach or failure to perform (i) would give rise to the failure of a condition set forth in Section 6.03(a) or Section 6.03(b) and (ii) is incapable of being cured prior to the Termination Date, or if capable of being cured, shall not have been cured within thirty (30) calendar days (but in no event later than the Termination Date) following receipt by the Company of written notice of such breach or failure to perform from the Purchaser stating the Purchaser’s intention to terminate this Agreement pursuant to this Section 7.01(d) and the basis for such termination; provided that the Purchaser shall not have the right to terminate this Agreement pursuant to this Section 7.01(d) if the Purchaser is then in material breach of any of its representations, 

26

 

 

 

warranties, covenants or agreements hereunder which breach would give rise to the failure of a condition set forth in Section 6.02(a) or Section 6.02(b); or

(e)by the Company if the Purchaser shall have breached any of its representations or warranties or failed to perform any of its covenants or agreements set forth in this Agreement, which breach or failure to perform (i) would give rise to the failure of a condition set forth in Section 6.02(a) or Section 6.02(b) and (ii) is incapable of being cured prior to the Termination Date, or if capable of being cured, shall not have been cured within thirty (30) calendar days (but in no event later than the Termination Date) following receipt by the Purchaser of written notice of such breach or failure to perform from the Company stating the Company’s intention to terminate this Agreement pursuant to this Section 7.01(e) and the basis for such termination; provided that the Company shall not have the right to terminate this Agreement pursuant to this Section 7.01(e) if the Company is then in material breach of any of its representations, warranties, covenants or agreements hereunder which breach would give rise to the failure of a condition set forth in Section 6.03(a) or Section 6.03(b).

Section 7.02Effect of Termination

.  In the event of the termination of this Agreement as provided in Section 7.01, written notice thereof shall be given to the other party, specifying the provision hereof pursuant to which such termination is made, and this Agreement shall forthwith become null and void (other than this Section 7.02 and Article VIII, all of which shall survive termination of this Agreement), and there shall be no liability on the part of the Purchaser or the Company or their respective directors, officers or Affiliates in connection with this Agreement, except that no such termination shall relieve any party from liability for damages to another party resulting from a willful and material breach of this Agreement prior to the date of termination.

Section 7.03Survival

.  All of the covenants or other agreements of the parties contained in this Agreement shall survive until fully performed or fulfilled, unless and to the extent that non-compliance with such covenants or agreements is waived in writing by the party entitled to such performance.  The representations and warranties of the parties contained in this Agreement shall survive the Closing until the later of (i) twelve (12) months from the Closing Date and (ii) one (1) month following the filing of the Company’s Annual Report on Form 10-K for the year ending December 31, 2018 and shall then expire but shall not survive the expiration or termination of this Agreement.  Notwithstanding any other provision of this Agreement, no party shall have any liability to the other in excess of the Purchase Price, and no party shall be liable for any special, speculative, consequential or punitive damages with respect to this Agreement.

Article VIII

Miscellaneous

Section 8.01Amendments; Waivers

.  Subject to compliance with applicable Law, this Agreement may be amended or supplemented in any and all respects only by written agreement of the parties hereto.

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Section 8.02Extension of Time, Waiver, Etc.

  The Company and the Purchaser may, subject to applicable Law, (a) waive any inaccuracies in the representations and warranties of the other party contained herein or in any document delivered pursuant hereto, (b) extend the time for the performance of any of the obligations or acts of the other party or (c) waive compliance by the other party with any of the agreements contained herein applicable to such party or, except as otherwise provided herein, waive any of such party’s conditions.

  Notwithstanding the foregoing, no failure or delay by the Company or the Purchaser in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right hereunder.  Any agreement on the part of a party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party.

Section 8.03Assignment

.  Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned, in whole or in part, by operation of Law or otherwise, by any of the parties hereto without the prior written consent of the other party hereto.  Subject to the immediately preceding sentence, this Agreement shall be binding upon, inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and permitted assigns.

Section 8.04Counterparts

.  This Agreement may be executed in counterparts, which together constitute one and the same agreement.  Each party hereto may rely on a facsimile or electronic signature on this Agreement.  If a party hereto sends a signed copy of this Agreement via facsimile, email or other electronic method, such party shall, upon request by the other party, provide a signed original of this Agreement via certified mail or overnight courier.

Section 8.05Entire Agreement; No Third-Party Beneficiaries; No Recourse

.  (a)  This Agreement constitutes the entire agreement, and supersedes all other prior agreements and understandings, both written and oral, among the parties and their Affiliates, or any of them, with respect to the subject matter hereof and thereof.

(b)No provision of this Agreement shall confer upon any Person other than the parties hereto and their permitted assigns any rights or remedies hereunder.

Section 8.06Governing Law; Jurisdiction

.  (a) This Agreement and performance under it shall be governed by and construed in accordance with the applicable Laws of New York, without giving effect to any choice-of-law provision or rule (whether of such State or any other jurisdiction) that would cause the application of the Laws of any other jurisdiction.

(b)Each party hereto irrevocably agrees that any Action brought by it in any way arising out of this Agreement must be brought solely and exclusively in state or federal courts located in New York County, New York, and each party hereto irrevocably submits to the sole and exclusive jurisdiction of these courts in personam, generally and unconditionally with respect to any action, suit or proceeding brought by it against, or against it by, the other party in any way arising out of this Agreement.  The 

28

 

 

 

consents to jurisdiction and venue set forth in this Section 8.06 shall not constitute general consents to service of process in the State of New York and shall have no effect for any purpose except as provided in this paragraph and shall not be deemed to confer rights on any Person other than the parties hereto.  Each party hereto agrees that service of process upon such party in any Action arising out of or relating to this Agreement shall be effective if notice is given by overnight courier at the address set forth in Section 8.09 of this Agreement.  The parties hereto agree that a final judgment in any such Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable Law; provided, however, that nothing in the foregoing shall restrict any party’s rights to seek any post-judgment relief regarding, or any appeal from, a final trial court judgment.

Section 8.07Specific Enforcement

.  The parties hereto agree that irreparable damage for which monetary relief, even if available, would not be an adequate remedy, would occur in the event that any provision of this Agreement is not performed in accordance with its specific terms or is otherwise breached, including if the parties hereto fail to take any action required of them hereunder to cause the Closing to occur.  The parties acknowledge and agree that (a) the parties shall be entitled to seek an injunction or injunctions, specific performance or other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof (including, for the avoidance of doubt, the right of the Company to cause the Purchase to be consummated on the terms and subject to the conditions set forth in this Agreement)  in the courts described in Section 8.06 without proof of damages or otherwise (in each case, subject to the terms and conditions of this Section 8.07), this being in addition to any other remedy to which they are entitled under this Agreement and (b) the right of specific enforcement is an integral part of the Transactions and without that right, neither the Company nor the Purchaser would have entered into this Agreement.  The parties hereto agree not to assert that a remedy of specific enforcement is unenforceable, invalid, contrary to Law or inequitable for any reason, and agree not to assert that a remedy of monetary damages would provide an adequate remedy or that the parties otherwise have an adequate remedy at law.  The parties hereto acknowledge and agree that any party seeking an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in accordance with this Section 8.07 shall not be required to provide any bond or other security in connection with any such order or injunction.

Section 8.08WAIVER OF JURY TRIAL

.  EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.  EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH 

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OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVER, (C) IT MAKES SUCH WAIVER VOLUNTARILY AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS SECTION 8.08.

Section 8.09Notices

.  All notices, requests and other communications to any party hereunder shall be in writing and shall be deemed given if delivered personally, by facsimile (which is confirmed), emailed (which is confirmed) or sent by overnight courier (providing proof of delivery) to the parties at the following addresses:

(a)  If to the Company, to it at:

Grubhub Inc.

111 W. Washington Street

Suite 2100

Chicago, Illinois 60602
Attention:  Adam Patnaude
Email:  apatnaude@grubhub.com

 

with a copy to:

 

Grubhub Inc.

1065 Sixth Avenue

New York, NY 10018
Attention: Maggie Drucker
Email: mdrucker@grubhub.com

 

(b)  If to the Purchaser or any Purchaser Party, to it at:

Yum! Brands, Inc.

1441 Gardiner Lane

Louisville, Kentucky 40213
Attention:  Scott A. Catlett
Email: scott.catlett@yum.com

 

with a copy to:

 

Yum! Brands, Inc.

1441 Gardiner Lane

Louisville, Kentucky 40213
Attention:  Keith Siegner
Email: keith.siegner@yum.com 

 

All notices shall be effective:  (i) upon actual receipt; (ii) three (3) Business Days after being sent by certified mail; (iii) the next Business Day after being sent by an 

30

 

 

 

internationally recognized courier; or (iv) on the same Business Day on which it is sent by email (or on the next Business Day, if transmission is completed after 5 p.m., recipient’s time).  Email notice must be promptly followed by notice given under clause (i), (ii) or (iii) above.  A party hereto may change its contact and notice information by giving the other party hereto proper notice of the change in accordance with this Section 8.09, but such change shall be effective only when it is actually received.

Section 8.10Severability

.  If any term, condition or other provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or incapable of being enforced by any rule of Law or public policy, all other terms, provisions and conditions of this Agreement shall nevertheless remain in full force and effect.  Upon such determination that any term, condition or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible to the fullest extent permitted by applicable Law.

Section 8.11Expenses

.  Except as expressly set forth in the last sentence of Section 5.01(b), all costs and expenses, including fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the Transactions shall be paid by the party incurring such costs and expenses, whether or not the Closing shall have occurred. 

Section 8.12Interpretation

.  (a) When a reference is made in this Agreement to an Article, a Section, Exhibit or Schedule, such reference shall be to an Article of, a Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated.  The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”.  The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement unless the context requires otherwise.  The words “date hereof” when used in this Agreement shall refer to the date of this Agreement.  The terms “or”, “any” and “either” are not exclusive.  The word “extent” in the phrase “to the extent” shall mean the degree to which a subject or other thing extends, and such phrase shall not mean simply “if”.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  All accounting terms used and not defined herein shall have the respective meanings given to them under GAAP.  All terms defined in this Agreement shall have the defined meanings when used in any document made or delivered pursuant hereto unless otherwise defined therein.  The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term.  Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments 

31

 

 

 

incorporated therein.  Unless otherwise specifically indicated, all references to “dollars” or “$” shall refer to the lawful money of the United States.  References to a Person are also to its permitted assigns and successors.  When calculating the period of time between which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded (unless, otherwise required by Law, if the last day of such period is not a Business Day, the period in question shall end on the next succeeding Business Day).

(b)The parties hereto have participated jointly in the negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party hereto by virtue of the authorship of any provision of this Agreement.

Section 8.13Acknowledgment of Securities Laws

.  The Purchaser hereby acknowledges that it is aware, and that it will advise its Affiliates and Representatives who are provided material non-public information concerning the Company or its securities, that the United States securities laws prohibit any Person who has received from an issuer material, non-public information from purchasing or selling securities of such issuer or from communication of such information to any other Person under circumstances in which it is reasonably foreseeable that such Person is likely to purchase or sell such securities.

[Remainder of page intentionally left blank]

 

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

 

				
	
 
	
GRUBHUB INC. 

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ Matt Maloney

	
 
	
Name:
	
 
	
Matt Maloney

	
 
	
Title:
	
 
	
Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

33

 

 

 

				
	
 
	
yum RESTAURANT SERVICES GROUP, LLC

 

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ Keith Siegner

	
 
	
Name:
	
 
	
Keith Siegner

	
 
	
Title:
	
 
	
Vice President, Investor Relations,

Corporate Strategy and Treasurer

 

 

 

 

 

 

 

 

 

 

 

34

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