Document:

cclp-ex101_24.htm

Exhibit 10.1

FIRST AMENDMENT TO CHANGE OF CONTROL AGREEMENT

 

This First Amendment to Change of Control Agreement (“Amendment”), dated as of March 11, 2021 (“Effective Date”), is by and between Roy E. McNiven (“Executive”) and CSI Compressco GP LLC f/k/a CSI Compressco GP, Inc. (“Company”) (Executive and Company collectively, the “Parties”).

WHEREAS, the Parties are parties to the Change of Control Agreement effective August 10, 2020 (“Existing COC Agreement”);

WHEREAS, the Parties desire to amend certain terms of the Existing COC Agreement;

WHEREAS, the Parties agree that a Change of Control occurred on January 29, 2021, with the Purchase and Sale Agreement between Spartan Energy Holdco, LLC, TETRA Technologies, Inc., and Spartan Energy Partners LP;

WHEREAS, Executive has contended that Executive has suffered a material diminution in his authority, duties, and responsibilities so as to qualify as Good Reason; and

WHEREAS, in the spirit of compromise and to avoid uncertainty in the future, the Executive and the Company have agreed to amend the Existing COC Agreement as stated in this Amendment.

NOW, THEREFORE, the Parties agree as follows:

1.Amendment.

(A)Section 2 of the Existing COC Agreement is hereby amended by adding the following:

 

If a Termination based on Executive’s resignation for any reason occurs on or after July 29, 2021 but before February 4, 2022 (“Special Termination”), subject to Section 3(c) and 3(d), the Company shall pay to Executive: (a) on the 60th day following the date of the Special Termination $550,000.00, less applicable tax withholdings and deductions, in a single lump sum payment (“Special Termination Payment”); and (b) any short-term cash-based incentive plan award for 2021 for Executive (“2021 STIP”) that remains unpaid as of any Date of Termination based on a Special Termination to the extent the applicable performance objectives are met for such 2021 STIP to be awarded, provided that any such 2021 STIP will be paid on a pro-rated basis based on the number of full months in 2021 occurring prior to any Date of Termination for a Special Termination divided by twelve.  Any payment of a 2021 STIP to Executive shall be made when similar awards are made to such corporate participants on or before March 31, 2022 but no sooner than March 1, 2022.  Notwithstanding anything stated in this Agreement: (i) except as stated in Section 3(b), the Special Termination Payment and the 2021 STIP are the only payments that Executive is eligible to receive under this Agreement relating to or arising from the Change of Control caused by the January 29, 2021, Purchase and Sale Agreement between Spartan Energy Holdco, LLC, TETRA Technologies, Inc., and Spartan Energy Partners LP (“Spartan Transaction”) based on a Termination by resignation of Executive, including, without 

		
	
FIRST AMENDMENT TO CHANGE OF CONTROL AGREEMENT
	
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limitation, any actual or alleged constructive discharge, based on any actual or alleged material diminution in Executive’s authority, duties or responsibilities (collectively, “Responsibility Trigger”); and (ii) Executive may not resign for Good Reason based on the Responsibility Trigger or after February 4, 2022 and be eligible to receive any amounts referenced in Section 3 prior to any Change of Control occurring after, and separate and apart from, the Spartan Transaction. Executive remains entitled to assert any Qualifying Termination occurring during the Protected Period after the Spartan Transaction based on any unilateral and involuntary Termination by the Company other than for Cause, when Executive remains willing and able to continue providing services.

 

(B)Section 3(b) of the Existing COC Agreement is hereby amended by deleting the existing Section 3(b) and replacing it with the following:

 

(b)Subject to Sections 3(c) and 3(d), if a Qualifying Termination or a Special Termination occurs with respect to the Executive, then (i) except as expressly prohibited as of the Effective Date by the terms of the applicable plan under which any such award is granted, all stock options, restricted units, phantom units, unit awards, unit appreciation rights, or other awards based in common units of the Partnership held by Executive and not previously vested shall become immediately 100% vested as of the Date of Termination, as applicable, (except with respect to an award that is subject to the Section 409A Rules if such acceleration would result in the imposition of applicable taxes and interest under the Section 409A Rules) and (ii) each option shall remain exercisable until the respective expiration dates of such options. Unless such acceleration is expressly prohibited as of the Effective Date by the terms of the applicable plan under which any such award is granted, the accelerated vesting of all options, restricted units, phantom units, unit awards, unit appreciation rights or other awards required by this Section 3(b) shall govern and have the effect of amending the award agreement relating to the award to be accelerated.

  

(C)Section 3(c) of the Existing COC Agreement is hereby amended by deleting the existing Section 3(c) and replacing it with the following:

 

(c)Release.  Notwithstanding anything in this Agreement to the contrary, no payment other than payment of the Accrued Obligations shall be made or benefits provided pursuant to this Agreement unless and until Executive signs and returns to the Company within 50 days following the date of a Qualifying Termination or the date of a Special Termination, as applicable, and does not revoke within seven days thereafter, any portion of a release and waiver agreement (“the Release of Claims”) in substantially the same form as that attached hereto as Exhibit A, with, in the case of a Special Termination, revisions made to reference a Special Termination in exchange for the benefits described in this Section 3 in the case of a Qualifying Termination and in exchange for the benefits described in Section 2 and in Section 3(b) in the case of a Special Termination, releasing and waiving all claims for liability and damages in any way related to Executive’s employment against the Partnership Group, TETRA Technologies, Inc. (“TETRA”), Spartan Energy Holdco, LLC, Spartan Energy Partners LP and any of their respective affiliates, directors, officers, employees and agents, and any of their respective employee benefit plans and fiduciaries and agents of such plans.

		
	
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(D)Section 3(d)(iv) of the Existing COC Agreement is hereby amended by deleting the existing Section 3(d)(iv) and replacing it with the following:

 

(iv)If payment of any amount pursuant to this Agreement on the 60th day following the Date of Qualifying Termination or the date of a Special Termination, as applicable, would cause such amount to be subject to additional taxes under the Section 409A Rules, such amounts shall be paid in accordance with the terms governing the timing of such payment as provided in the applicable plan or agreement.

 

(E)Section 4(a) of the Existing COC Agreement is hereby amended by deleting the last sentence of Section 4(a) and replacing it with the following:

 

Notwithstanding any other provision of this Agreement to the contrary, Executive shall only be required to comply with the provisions of Section 4(d) following the Date of Termination if Executive receives the benefits as provided in Section 3 above if the Termination is a Qualifying Termination or the benefits as provided in Section 2 and Section 3(b) if the Termination is a Special Termination. 

(F) Section 5(a) of the Existing COC Agreement is hereby amended by deleting the existing Section 5(a) and replacing it with the following:

 

(a)Anything in this Agreement to the contrary notwithstanding, if the Executive is a “disqualified individual” (as defined in Section 280G of the Code), and the severance benefits provided in Section 2 or Section 3, as applicable, together with any other payments which the Executive has the right to receive, would constitute a “parachute payment” (as defined in Section 280G of the Code), the severance benefits provided hereunder that constitute a parachute payment shall be either (i) reduced (but not below zero) so that the aggregate present value of such payments received by the Executive from the Company will be one dollar ($1.00) less than three times the Executive’s “base amount” (as defined in Section 280G of the Code) and so that no portion of such payments received by the Executive shall be subject to the excise tax imposed by Section 4999 of the Code, or (ii) paid in full, whichever produces the better net after-tax result for the Executive (taking into account any applicable excise tax under Section 4999 of the Code and any other applicable taxes).  

(G) Section 5(b) of the Existing COC Agreement is hereby amended by deleting the first sentence of Section 5(b) and replacing it with the following:

 

In making any reductions pursuant to Section 5(a), above, the Company shall reduce or eliminate amounts first by reducing those amounts that are not payable in cash, and then by reducing or eliminating cash amounts, in each case in reverse order beginning with amounts, if any, that are to be paid the farthest in time from the Date of Qualifying Termination or the date of Special Termination, as applicable; provided, however, that no amount that is subject to the Section 409A Rules shall be reduced or eliminated until all amounts that are not subject to the Section 409A Rules have been eliminated, and then all such amounts that are subject to the Section 409A Rules shall not be reduced in reverse order but shall be reduced proportionally.  

		
	
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(H)Section 6(c) of the Existing COC Agreement is hereby amended by deleting the existing deleting the existing Section 6(c) and replacing it with the following:

 

(c) Cooperation.  If Executive becomes entitled to benefits under Section 2 and/or Section 3 of this Agreement, Executive agrees, for a one-year period following the Date of Termination, to provide reasonable cooperation to the Partnership Group in response to reasonable requests made by the Company for information or assistance, including but not limited to, participating upon reasonable notice in conferences and meetings, providing documents or information, aiding in the analysis of documents, or complying with any other reasonable requests by the Company including execution of any agreements that are reasonably necessary, provided such cooperation relates to matters concerning Executive’s duties with the Partnership Group and the requests do not, in the good faith opinion of Executive, materially interfere with Executive’s other activities

(I)Section 6(f) of the Existing COC Agreement is hereby amended by deleting the existing notice address for the Company and replacing it with the following:

If to Company:

CSI Compressco GP LLC

9595 Six Pines Drive, Suite 4000

The Woodlands, Texas 77380

Attention: Chief Executive Officer

 

(J)Section 6(g) of the Existing COC Agreement is hereby amended by deleting the first sentence of Section 6(g) and replacing it with the following:

 

No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing signed by Executive and by the Chairman of the Board or the Chief Executive Officer of the Company.  

 

(K)Number 7 of Annex I to the Existing COC Agreement is hereby amended by deleting 7(b)(i)-(v) in its entirety and adding the following after 7(a) and before the paragraph in Number 7 that begins “Notwithstanding the foregoing, however, in any circumstance or transaction in which compensation would be subject to the income tax under the Section 409A Rules...”:

 

The Company and Executive agree that any sale or merger of any kind involving only Spartan Energy Holdco, LLC, Spartan Energy Partners LP, and/or any of either of their Affiliates and Company or Partnership shall not constitute a Change of Control for the purposes of this Agreement.

 

(L)Number 19 of Annex I to the Existing COC Agreement is hereby amended by deleting the existing Number 19 and replacing it with the following:

 

19.Protected Period. The "Protected Period" shall mean the period of time beginning with the Change of Control and ending on the two-year anniversary of such Change of Control or Executive's death, if earlier; provided, however, if Executive's employment 

		
	
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with the Company is  terminated by the Company other than for Cause during the Term and within six months prior to  the date on which a Change of Control occurs (e.g., not during the Protected Period), and it is reasonably demonstrated by Executive that such termination was at the request of a third party who has taken steps reasonably calculated to effect the Change of Control, or otherwise arose in connection with or anticipation of the Change of Control, then for purposes of determining whether  a Qualifying Termination has occurred and only for such purposes, the Change of Control shall be deemed to have occurred on the date immediately prior to the Date of Termination and Executive  shall be deemed to have experienced a Qualifying Termination by the Company other than for Cause.

 

2.Effect on the Existing COC Agreement.  Except as specifically amended by this Amendment, all terms of the Existing COC Agreement shall remain in full force and effect.  The term “Agreement” as used in the Existing COC Agreement shall mean the Existing COC Agreement as amended by this Amendment.  Capitalized terms used in this Amendment and not otherwise defined in this Amendment shall have their respective meanings set forth in the Existing COC Agreement.

3.Other.

(A)This Amendment shall in all respects be interpreted, enforced, and governed under the laws of the State of Texas.  The Parties agree that the language in this Amendment shall, in all cases, be construed as a whole, according to its fair meaning, and not strictly for, or against, any of the Parties.

(B)This Amendment may be executed in counterparts, each of which shall constitute an original, but all of which when taken together shall constitute a single contract.

(C)This Amendment, along with the Existing COC Agreement and the July 27, 2020 letter agreement between the Company and Executive concerning a cash retention award and the related Exhibit A, constitute the entire agreement among the Parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, related to the subject matter hereof.

(D)This Amendment shall not be amended or revised except in a writing executed by both of the Parties.

IN WITNESS WHEREOF, the Parties have executed this Amendment to be effective as of the Effective Date.

		
	
ROY E. MCNIVEN

 
	
CSI COMPRESSCO GP LLC

	
By: /s/ Roy E. McNiven                   
	
By: /s/ John E. Jackson

	
 
	
Printed Name: John E. Jackson

	
 
	
Title: Chief Executive Officer

	
Date: March 11, 2021
	
Date: March 11, 2021

 

		
	
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Exhibit 4.2

 

DESCRIPTION OF SECURITIES REGISTERED UNDER SECTION 12 OF THE EXCHANGE ACT

The following description of registered securities of Pandion Therapeutics, Inc. (“us,” “our,” “we” or the “Company”) is intended as a summary only and does not purport to be complete. It is subject to and qualified in its entirety by reference to the Company’s Restated Certificate of Incorporation (the “Certificate of Incorporation”), the Company’s Amended and Restated Bylaws (the “Bylaws”), and the applicable provisions of the Delaware General Corporation Law (the “DGCL”). The Certificate of Incorporation and the Bylaws are incorporated by reference as Exhibit 3.1 and Exhibit 3.2, respectively, to the Annual Report on Form 10-K of which this Exhibit 4.2 is a part.

Authorized Capital Stock 

Our authorized capital stock consists of 200,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 per share. Our common stock is registered under Section 12(b) of the Exchange Act (the “Exchange Act”).

Common Stock 

Voting Rights.  Holders of our common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders and do not have cumulative voting rights. Each election of directors by our stockholders will be determined by a plurality of the votes cast by the stockholders entitled to vote on the election. Any matters other than the election of directors to be voted upon by the stockholders at a meeting are decided by the vote of the holders of shares of stock having a majority in voting power of the votes cast by the holders of all of the shares of stock present or represented at the meeting and voting affirmatively or negatively on such matter, except when a different vote is required by law, our Certificate of Incorporation or our Bylaws.

Dividends. Holders of common stock are entitled to receive proportionately any dividends as may be declared by our board of directors, subject to any preferential dividend or other rights of any outstanding preferred stock.

Liquidation, Dissolution and Winding Up. In the event of our liquidation, dissolution or winding up, the holders of our common stock are entitled to receive proportionately all assets available for distribution to stockholders after the payment of all debts and other liabilities and subject to any preferential or other rights of any outstanding preferred stock.

Other Rights. Holders of our common stock have no preemptive, subscription, redemption or conversion rights. The rights, preferences and privileges of holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of our preferred stock that we may designate and issue in the future.

Preferred Stock 

Under the terms of our Certificate of Incorporation, our board of directors is authorized to issue up to 5,000,000 shares of preferred stock in one or more series without stockholder approval. Our board of directors has the discretion to determine the rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock. The issuance of preferred stock could impede the completion of a merger, tender offer or other takeover attempt.

Provisions of Our Certificate of Incorporation and Bylaws and the Delaware General Corporation Law That May Have Anti-Takeover Effect

Board of Directors; Removal of Directors.  Our Certificate of Incorporation and our Bylaws divide our board of directors into three classes with staggered three-year terms. In addition, our Certificate of Incorporation and our Bylaws provide that directors may be removed only for cause and only by the affirmative vote of the holders of at least 75% of our shares of capital stock present in person or by proxy and entitled to vote in an election of directors or class of directors. Under our Certificate of Incorporation and our Bylaws, any vacancy on our board of directors, including a vacancy resulting from an enlargement of our board of directors, may be filled only by vote of a majority of our directors then in office. Furthermore, our Certificate of Incorporation provides that the authorized number of directors may be changed only by the resolution of our board of directors. The classification of our board of 

 

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directors and the limitations on the ability of our stockholders to remove directors, change the authorized number of directors and fill vacancies could make it more difficult for a third party to acquire, or discourage a third party from seeking to acquire, control of our company.

Stockholder Action; Special Meeting of Stockholders; Advance Notice Requirements for Stockholder Proposals and Director Nominations. Our Certificate of Incorporation and our Bylaws provide that any action required or permitted to be taken by our stockholders at an annual meeting or special meeting of stockholders may only be taken if it is properly brought before such meeting and may not be taken by written action in lieu of a meeting. Our Certificate of Incorporation and our Bylaws also provide that, except as otherwise required by law, special meetings of the stockholders can only be called by our board of directors. In addition, our Bylaws establish an advance notice procedure for stockholder proposals to be brought before an annual meeting of stockholders, including proposed nominations of candidates for election to our board of directors. Stockholders at an annual meeting may only consider proposals or nominations specified in the notice of meeting or brought before the meeting by or at the direction of our board of directors, or by a stockholder of record on the record date for the meeting who is entitled to vote at the meeting and who has delivered timely written notice in proper form to our secretary of the stockholder’s intention to bring such business before the meeting. These provisions could have the effect of delaying until the next stockholder meeting stockholder actions that are favored by the holders of a majority of our outstanding voting securities. These provisions also could discourage a third party from making a tender offer for our common stock because even if the third party acquired a majority of our outstanding voting stock, it would be able to take action as a stockholder, such as electing new directors or approving a merger, only at a duly called stockholders meeting and not by written consent. 

Super-Majority Voting. The DGCL provides generally that the affirmative vote of a majority of the shares entitled to vote on any matter is required to amend a corporation’s Certificate of Incorporation or Bylaws unless a corporation’s Certificate of Incorporation or Bylaws, as the case may be, requires a greater percentage. Our Bylaws may be amended or repealed by a majority vote of our board of directors or the affirmative vote of the holders of at least 75% of the votes that all our stockholders would be entitled to cast in any annual election of directors. In addition, the affirmative vote of the holders of at least 75% of the votes that all our stockholders would be entitled to cast in any election of directors is required to amend or repeal or to adopt any provisions inconsistent with any of the provisions of our Certificate of Incorporation described above. 

Delaware Business Combination Statute. We are subject to Section 203 of the DGCL. Subject to certain exceptions, Section 203 prevents a publicly held Delaware corporation from engaging in a “business combination” with any “interested stockholder” for three years following the date that the person became an interested stockholder, unless either the interested stockholder attained such status with the approval of our board of directors, the business combination is approved by our board of directors and stockholders in a prescribed manner or the interested stockholder acquired at least 85% of our outstanding voting stock in the transaction in which it became an interested stockholder. A “business combination” includes, among other things, a merger or consolidation involving us and the “interested stockholder” and the sale of more than 10% of our assets. In general, an “interested stockholder” is any entity or person beneficially owning 15%or more of our outstanding voting stock and any entity or person affiliated with or controlling or controlled by such entity or person. 

Exclusive Forum Selection. Our Certificate of Incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if the Court of Chancery of the State of Delaware does not have jurisdiction, the federal district court for the District of Delaware) shall be the sole and exclusive forum for (1) any derivative action or proceeding brought on our behalf, (2) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, other employees or stockholders to our company or our stockholders, (3) any action asserting a claim arising pursuant to any provision of the DGCL or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (4) any action asserting a claim arising pursuant to any provision of our Certificate of Incorporation or Bylaws (in each case, as they may be amended from time to time) or governed by the internal affairs doctrine. This exclusive forum provision will not apply to actions arising under the Securities Act of 1933, as amended, or the Exchange Act or any other claim for which federal courts have exclusive jurisdiction. Our Certificate of Incorporation further provides that unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any claims arising under the Securities Act. Under the Securities Act, federal and state courts have concurrent jurisdiction over all suits 

 

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brought to enforce any duty or liability created by the Securities Act, and investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. These exclusive forum provisions may limit the ability of our stockholders to bring a claim in a judicial forum that such stockholders find favorable for disputes with us or our directors, officers or employees, which may discourage such lawsuits against us and our directors, officers and employees. Although our Certificate of Incorporation contains the choice of forum provision described above, it is possible that a court could rule that such a provision is inapplicable for a particular claim or action or that such provision is unenforceable.

 

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